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Newly Introduced Federal Legislation Would Offer Flexibility for Rural Hospitals to Meet the Needs of Rural Communities

February 13, 2019

Two new legislative proposals introduced in the U.S. House of Representatives would provide flexibility for rural providers to appropriately manage the length of stay of patients served by critical access hospitals (CAH) and better leverage the clinical workforce to provide care to patients in underserved communities.

The Critical Access Hospital Relief Act (H.R. 1041) would repeal the 96-hour condition of payment, which requires physicians to certify that patients admitted to a CAH may reasonably be expected to be discharged or transferred to another hospital within 96 hours. While CAHs typically maintain an annual average of 96 hours per patient, they offer some medical services that have standard lengths of stay greater than 96 hours. The additional operational step of certification and regulatory limitation of the condition of payment may ultimately affect access to appropriate care for Medicare beneficiaries receiving care in the hospital in their community.

H.R. 1052 would authorize physician assistants to receive direct payment under Medicare to expand their role as medical providers in underserved communities.

Pennsylvania’s rural hospitals are working with state and federal policymakers to consider ways to reshape the delivery of care and payment, taking into account inherent challenges in serving rural communities—geographic location, lower patient volume, workforce recruitment, technology adoption, and strained financial resources.

According to the Pennsylvania Department of Health, approximately one in four Pennsylvanians live in rural areas of the state. Pennsylvania’s 42 rural hospitals are the primary, and sometimes the only, source of care in rural Pennsylvania. They are economic anchors and often the largest employer in rural communities.

The American Hospital Association (AHA) recently released a new report, “Challenges Facing Rural Communities and the Roadmap to Ensure Local Access to High-quality Affordable Care,” outlining the trends and conditions that threaten rural hospitals’ ability to maintain access to health care services in their communities, and defining policy solutions. Citing similar themes, the U.S. Department of Health and Human Services (HHS) has articulated three key rural health care strategies:

  • Sustainability—introducing new payment models and leveraging the Health Resources and Services Administration’s community health centers
  • Innovation—leveraging technology, including telemedicine, to improve rural health
  • Flexibility—reducing unnecessary regulation with particular focus regarding clinical staff’s scope of practice

Consistent with the strategic policy priorities identified in the AHA report and the themes being pursued by HHS, HAP is advocating for policies in Harrisburg and Washington, DC, to:

  • Secure adequate public funding through Medicaid and key federal programs that offer targeted financial support to rural hospitals
  • Modernize outdated laws and regulations to create flexibility for rural hospitals
  • Modernize telehealth payment policies to cover more services and improve patient access to Pennsylvania’s best specialists
  • Identify and address critical workforce issues facing rural communities, including allowing health care providers to offer care to the fullest extent of their license
  • Support access to affordable prescription drugs in vulnerable communities

Importantly, Pennsylvania is embarking on an innovative new way of supporting care in rural communities. HAP is working to support the commonwealth in launching the Pennsylvania Rural Health Model, an all-payor global budget model, in conjunction with the Center for Medicare and Medicaid Innovation. The new model is intended to provide rural hospitals with consistent and predictable revenue so they can marshal resources to implement strategies that meet the unique health care needs of participating hospitals’ communities.

Please contact Laura Stevens Kent, HAP’s vice president, federal advocacy, with questions about federal legislative activities, and questions about rural delivery and payment system reform can be directed to Kate Slatt, HAP’s senior director, innovative payment and care delivery.

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