SUGGESTIONS FOR IMPROVING RURAL HEALTH IN ALABAMA

BRIEF DESCRIPTION OF THE CRISIS

Early in 2017, the federal Health Resources and Services Administration (HRSA) estimated that Alabama needed 157 primary care physicians placed where the need was the greatest to eliminate all shortages. Simply eliminating the shortages would only provide MINIMAL primary care service statewide rather than OPTIMAL care. A statewide redetermination was completed at the end of 2017. HRSA now estimates that Alabama needs 321 strategically placed primary care physicians to eliminate all shortages. THE PROBLEM IS MUCH GREATER THAN WAS THOUGHT AND IS GETTING WORSE.
As of September 2018, only two (Coffee and Escambia) of Alabama’s 54 rural counties were not entirely or partially classified as primary care shortage areas by HRSA.
Seven rural Alabama counties (Cleburne, Coosa, Henry, Lamar, Lowndes, Macon, and Perry) do not have a hospital.
45 of Alabama’s 54 rural counties do not have a hospital providing obstetrical services.
According to the Alabama Hospital Association, 86% of Alabama’s rural hospitals are currently operating at a net operating loss with 64% having a net total loss. Operating loss pertains to the hospital, only. Total loss pertains to the hospital and all other services (nursing home, imaging center, rural health clinic, etc.) operated by the hospital.

SUGGESTIONS ON RELIEVING ALABAMA’S RURAL HEALTH CRISIS

Acknowledge that there is a crisis and that Alabama is going to take progressive action:

The most important single office in Alabama’s state government for providing rural health support is the State Office of Rural Health (SORH). The purpose of this office, as described by the federal Office of Rural Health Policy, is to assist states in strengthening rural health care delivery systems by maintaining a focal point for rural health within each state.  This office is to provide an institutional framework that links small rural communities with state and federal resources to develop long term solutions to rural health problems.

The State Office of Rural Health program is funded through a federal grant program with only one State Office of Rural Health being funded in each state. The Governor of each state designates who can apply for this grant in their state. This office in Alabama is located in the Alabama Department of Public Health (ADPH) in the Office of Primary Care and Rural Health.

Through 2005, this office was located directly under the State Health Officer in the ADPH organization. This important office is now buried in organizational obscurity and is seriously under staffed. It is now located within a Bureau with the SORH office director answering to the bureau director who then answers to an assistant state health officer who then answers to the State Health Officer.

A strong statement about the importance of rural residents and our rural health crisis and a notice that Alabama is going to deal with this crisis effectively can be made by simply placing this office directly under the State Health Officer, again, in the ADPH organizational structure.

Alabama’s State Office of Rural Health was initially located in the Governor’s office when the federal government started the State Office of Rural Health program. It was transferred from the Governor’s Office to the ADPH and combined with the federal State Primary Care Office program. If the ADPH is not willing to recognize the importance of rural health in Alabama by moving this office back directly under the State Health Officer’s supervision and adequately staffing this office, it could be moved back to the Governor’s office. Elevating this office to the important place that it should occupy will require no cost and could be done quickly.

Correct the many flaws in Alabama’s current rural physician tax credit incentive law:

Alabama implemented an innovative state income tax credit incentive program in 1993 aimed at encouraging primary care physicians to practice in our rural areas and to make rural Alabama more competitive in attracting primary care physician services. This law is included in Sections 40-18-130 through 40-18-132 of the Code of Alabama. State income tax credits of $5,000 per year for five years were provided for qualifying physicians through this law.

Unfortunately, several flaws in this law are restricting the intent for which the law was passed. Several of these are as follows:

Strict interpretation of the definitions included in the 1993 law could limit those qualifying for the tax credit to include only those physicians who reside in AND practice in communities with less than 25,000 population AND have admitting privileges at an acute care hospital (with fewer than 105 beds) that is located in a community of less than 25,000 population. Only 40 of Alabama’s 440 communities with less than 25,000 population have a hospital with fewer than 105 beds. FORTUNATELY, OFFICIALS WITH THE ALABAMA DEPARTMENT OF REVENUE ARE RESPECTING THE INTENT OF THE LAW AND ARE ALLOWING PHYSICIANS WHO RESIDE OR PRACTICE IN SMALL COMMUNITIES WHICH DO NOT HAVE HOSPITALS TO RECEIVE THE CREDIT.

There is no clarification about the number of hospital beds being actual or authorized. According to the Alabama Department of Public Health, the hospital in Talladega is a 122 bed General Hospital with an authorized bed count of 103. Does this hospital meet the requirement of having fewer than 105 beds? A strict interpretation by revenue department investigators could disqualify physicians with admitting privileges at this hospital from receiving the credit.

There is also a requirement that the hospital where the physician has admitting privileges cannot be more than 19 miles, under normal travel conditions, from another Alabama acute care hospital. There is no specification about how this distance is to be determined. One physician, who was requested to reimburse $15,000 for receiving the tax credit, was told that there was less than 19 miles between the hospitals in Bay Minette and Atmore. According to Mapquest, the shortest driving distance between these two hospitals is exactly 23.0 miles.

The requirement that a qualifying physician must have admitting privileges at a small or rural hospital is not reasonable in many situations. Many physicians practice closer in distance to a larger or urban hospital. It is not reasonable to require them to admit their patients to a small or rural hospital that is farther away from their practice just to qualify for this credit. It is also unreasonable to require physicians practicing in a clinic that is owned or operated by a larger or urban hospital to admit their patients to a hospital other than the one owning or operating the clinic. This admitting privileges requirement is a special concern for physicians practicing on one of the seven Alabama counties that do not have a hospital.

Most hospitals, including small or rural hospitals, now employ the services of a “hospitalist”. A hospitalist is a physician employed by the hospital to see patients who were admitted by other physicians, provide emergency department service, and provide other physician services that are needed by the hospital. Most hospitalists do not have admitting privileges and, thus, will not qualify for receiving the credit even though their service is consistent with the intent of the law. The hospitalist did not exist when the current law was passed in 1993.

There is no requirement for the amount of time that a physician must practice in a small or rural community to qualify for the credit. Supposedly, a physician meeting all requirements but only seeing a few patients each year could receive the credit.

The lack of clarity in the current law makes fair enforcement difficult. The Alabama Department of Revenue is doing a good job in considering the intent of the law in determining enforcement. However, this is an unnecessary burden since the flaws can be corrected. Several physicians practicing within the intent of the 1993 law are being required to reimburse up to $15,000 in credits that have been received. These funds are not always easy to provide.

These examples reveal several of the flaws in Alabama’s current rural physician income tax credit incentive law. Legislation to correct these flaws has been introduced during the past three regular sessions. This legislation (SB 79) passed the Senate, but failed to pass the House in the 2018 Session. In addition to correcting the known flaws in the 1993 law, this proposed legislation seeks to expand the number of years for which the credit can be received from five to 10 and authorizes the same credits for dentists, since the shortage of dentists in rural Alabama may be greater than that for physicians. At a very minimum, the known flaws in the 1993 law need to be corrected in the 2019 Session.

Develop a program that will rapidly produce primary care physicians to decrease or eliminate the rural shortage:

As noted in the description of our rural health crisis, the shortage of primary care physicians is considerably greater than we thought only a year ago. Alabama has some small programs aimed at producing rural primary care physicians. These programs are producing excellent physicians, but are producing too few to even sustain the current shortage level. To use swimming pool terminology, Alabama needs a shock treatment to rapidly correct this critical and growing shortage. When we catch up, our smaller, existing maintenance programs can be more effective.

House Bill 20 (HB 20), which was introduced in the 2018 session, would have funded 25 medical students at Alabama medical schools each year in return for a service obligation in areas of the greatest need. The Alabama Medical Education Consortium (AMEC), a highly successful nonprofit organization, was designated to direct this program. This legislation was changed near the end of the session to provide this funding to the existing Board of Medical Scholarships Awards Program for direction and failed to be passed.

This innovative and progressive idea in HB 20, which was developed by AMEC, could greatly assist in catching up on our primary care physician shortage faster. Thought should be given to implementing this program and allowing AMEC to direct the effort.

AMEC and its director, Wil Baker, Ph.D., have been involved in highly successful primary care physician programs. AMEC was established to assist in producing more primary care physicians for Alabama, using out-of-state osteopathic medical schools. This effort was opposed by the existing medical education system in Alabama. Despite this opposition, this effort to produce more primary care physicians quickly resulted in the creation of a third medical school in Alabama, well beyond the reason for its creation.

AMEC was also funded by the Alabama Legislature to establish up to 12 and possibly 14 new primary care residency programs in Alabama.  Considerable research has shown that physicians are much more likely to enter medical practice close to where they completed their residency training.  As of today, two of these residency programs have come on line with 21 new residents. Expectation is that this AMEC effort when mature will add about 400 new residents in our State.

Such a record of AMEC’s success would be encouraging for consideration of the HB 20 (scholarships) effort.

Expand the scope of practice for nurse practitioners (advanced practice nurses) in Alabama:

Alabama needs to allow nurse practitioners to provide the service that they are trained to provide and are being allowed to provide in other states, including some of our neighboring states.

I have visited every medical clinic in 51 rural Alabama counties and have seen physicians and nurse practitioners working as partners to give each other sorely needed time away from a demanding and stressful practice. These partnerships also enable clinics to expand their hours of service to where those who cannot get to the clinic during traditional hours of operation can receive health care service. Many rural clinics are even starting to provide service on weekend days by utilizing the services of nurse practitioners. Nurse practitioners can also play a major role in working with patients to expand access to telemedicine services in our rural areas. Partnering with nurse practitioners can allow for more adequate utilization of limited primary care physician services.

Several rural hospitals are interested in having their emergency departments staffed by nurse practitioners, especially during the early morning hours when patient presentations are fewer. This is being done in Mississippi. I talked with the CEO of the rural hospital in Leaksville, Mississippi and learned that four nurse practitioners from Mobile, Alabama were providing the services for their emergency department. This hospital is located in a county that does not have a single physician.

In Alabama, nurse practitioners must have a collaborating physician who must be with them 10 percent of their practice time and must review 10 percent of their patient files. A physician cannot serve as the collaborating physician for more than four nurse practitioners. Some nurse practitioners have to pay physicians up to $2,000 each month to get them to serve as their collaborating physician because of the time demand on their own physician practice. With there being fewer physicians in our rural areas, and not all physicians desiring to serve as a collaborating physician, a special difficulty in securing a collaborating physician exists for nurse practitioners who are willing to provide service in underserved rural areas.

Most nurse practitioners that I have talked with value collaboration with physicians, especially before they have considerable practice experience. Alabama could possibly be a leader by considering a form of electronic collaboration. This backup service could be provided by businesses that have physician consultation available 24/7 using telemedicine equipment. The review of patient files could be handled by these companies. These could also serve as a backup service for non-emergency medicine physicians and residents who staff many of our rural hospital emergency departments.

Expand the use of tele-health and telemedicine in Alabama:

With Alabama’s unfavorable health status, we should be a leader in the development and utilization of this highly promising technology. Unfortunately, we are followers at best.

Telemedicine is of three main types, one of which is already being widely used. Store-and–forward is the term given to services such as the taking of images locally and then electronically transmitting these images to distant locations where they are read and findings are quickly reported. This technology is being widely used in Alabama.

High risk patient monitoring is the name given to having special equipment located in the homes of patients who are at high risk because of their health status or geographic isolation. This service is already being provided to many in Alabama, including Alabama Department of Public Health home health patients. The patient is called on a scheduled basis and selected vitals are monitored using the equipment. Patients can initiate the monitoring if they feel there is a need. This technology is being used to get assistance to high risk patients faster and to prevent unnecessary visits to clinics where transportation may be difficult.

The other major type of telemedicine involves the use of telemedicine carts or other special equipment where a distant provider can see and talk with a patient and their local provider and possibly render a diagnosis without the patient having to travel great distances for care. Numerous diagnostic instruments are available through this promising technology to allow for services to be provided in various specialties. Telemedicine care has been provided to Georgia patients in over 40 specialties and sub-specialties. This technology is already being used to provide several services such as stroke care, wound care, dermatology, cardiology, psychiatry, child psychiatry, and HIV care in Alabama.

There are two main barriers to better using telemedicine in Alabama. We need universal broadband coverage throughout the entire state. We also need legislation requiring reimbursement for telemedicine services from private insurers. Such legislation has already been passed into law in neighboring Georgia, Tennessee, and Mississippi. Blue Cross/Blue Shield of Alabama (BCBS) has voluntarily started reimbursing for several types of telemedicine service and should be applauded for this action. However, other private insurers providing coverage in
Alabama are under no obligation to follow the actions of BCBS.

Given the fact that Alabama is a unique state that is served primarily by only one private insurance company, there may be greater agreement to consider legislation that has been favored in a few other states rather than the blanket requirement used in those states bordering Alabama. Another approach could be the establishing of a telemedicine commission in Alabama to oversee the use of this technology that will include representation from several stakeholders, including private insurance.

Private insurance reimbursement could be authorized by this commission when it is determined that specific services can be provided using telemedicine without a loss in quality of care. Equipment standards could be determined and required by this commission. Having statewide equipment and other technical standards could avoid the possibility of different providers having telemedicine equipment that cannot work together.

Allow rural Alabama to have hospitals that are needed today, rather than yesterday:

Alabama has an antiquated requirement that a hospital must have 15 beds to be licensed. This requirement was established back when a physician could admit anyone to a hospital for virtually anything and leave them there as long as they wanted. This is no longer the situation. The result is that many of our rural hospitals have large numbers of chronically empty beds, contributing to financial crisis.

Alabama also requires that every hospital must have an emergency department to be licensed to operate. Several other states, including Georgia, allow hospitals to be licensed to operate without an emergency department, where this will work.

Both of these requirements need to be re-visited in Alabama. Changes in the requirements for hospitals would have to be authorized by a special committee that is located within the Alabama Department of Public Health. This committee has the responsibility of authorizing the types of health care facilities that may operate in Alabama and developing the rules and regulations for the operation of each type of facility.

The national trend today is to have micro-hospitals in rural areas with a few inpatient beds. Patients are treated in the emergency department or hospital operated clinic and sent home, or admitted overnight for observation, or stabilized and transferred to a larger and more comprehensive medical center.

The most popular piece of federal rural hospital legislation today is the “Save Rural Hospitals Act”. This act would establish a new type of federal hospital, the Community Outpatient Hospital. This hospital would be allowed to have a few beds for observational care and would provide 105 percent of actual cost for emergency department and observational care for Medicare patients. If this legislation is passed, Alabama hospitals cannot consider this option because of our state requirement of 15 or more beds. That many beds would not be needed for observational care.

The opposition to changing this requirement is of uncertain origin, but is real. A recent conversation with a ranking Alabama Department of Public Health official revealed that she had heard discussion about this requirement, but the ADPH had no interest in seeking such a change at this time. There has been an expressed concern that allowing new micro hospitals to be built when so many existing rural hospitals are operating at a loss could harm the already serious financial plight of existing hospitals.

This is true and must be prevented. However, doing nothing to change this requirement is making hospitals that are being rebuilt to construct more beds than they actually need. Alabama needs to consider changing this requirement and restricting the usage to avoid endangering existing hospitals while allowing those that are being rebuilt to build what is needed.

It is possible that there are currently rural hospitals that are at risk of closing, but could remain open if they were not required to have an emergency department. Emergency departments are revenue losers for most rural hospitals. A hospital operating without an emergency department would need to be allowed only where it could work without posing an undue risk to area residents. There would have to be other emergency department service available within a safe distance and local emergency medical services may need to be upgraded to allow for safer transport for the additional distance to emergency department services.

If the ADPH is not interested in considering revision to the bed and emergency department requirements for rural hospitals, Alabama’s legislature may want to consider requiring that this action be taken.

Find new services and revenue streams for existing rural hospitals with chronically unoccupied beds:

Many of our rural hospitals have a large number of chronically unoccupied inpatient beds that produce an expense. The hospitals do not need to be torn down and rebuilt smaller. The most practical solution is to find new sources of revenue for rural hospitals that may or may not utilize these empty beds. Such new revenue could improve the hospital’s financial status while providing services that are needed and beneficial.

Several ideas have been proposed. Chronically empty beds could be used to house immobile or unthreatening inmates to assist in responding to the federal court order that Alabama is under regarding inmate health care. A separate and secure area could be established for using the empty beds within the hospital. The hospital should be able to provide health care, food, housing, clothing, etc. for the inmates at a lower cost than is currently being required.

The hospital or nursing home could use chronically empty beds to offer adult day care if Alabama’s Medicaid Program sought and received a waiver to allow for Medicaid to cover adult day care. There are many permanent nursing home residents who may be able to avoid more expensive full time nursing home residency if paid adult day care was available while their caretakers are at work. This could produce substantial savings for Medicaid and provide a new revenue stream for rural hospitals and nursing homes.

The veteran’s CHOICE program could be expanded to cover inpatient services for local veterans. Alabama’s four veteran’s medical centers could be used to provide inpatient care for local veterans and specialty inpatient care statewide. Local hospitals could contract with the Veteran’s Administration to allow local veterans to receive non-specialty care from local providers at the local hospital. This would provide better care for veterans and provide a new revenue stream for our struggling rural hospitals.

Alabama is blessed with many wise and innovative residents. Additional ideas on new revenue streams for our financially threatened rural hospitals need to be sought.

Alabama needs to reconsider Medicaid expansion:

The wisdom behind offering Medicaid expansion was in question when this was originally offered. The federal government was confronted with a dire financial situation and the wisdom of establishing such a great expense at the federal level raised serious questions. However, once this was established, the logic of Alabama not participating, while seeing tax dollars paid from the pocket books of working Alabamians going to benefit states like California and New York, raised equally serious questions.

We now have greatly improving federal, state, and local economies. Paying for such expansion is not in question to the extent that it was at the time this option was first offered.

Medicaid is often referred to as being rural Alabama’s health insurance. Alabama needs to reconsider expanding Medicaid. This will greatly benefit the health status of many rural residents and the financial status of our rural hospitals.

Return obstetrical services to Alabama’s rural hospitals:

In 1980, 45 of the 54 counties that are considered to be rural by the Alabama Department of Public Health, Office of Primary Care and Rural Health had one or more local hospitals providing obstetrical services. Today, only 16 of these 54 rural counties still have hospitals providing this basic health service. Statewide, 38 of Alabama’s 67 counties do not have a hospital that provides obstetrical services.

This crisis is much greater in Alabama’s 12 Black Belt Region counties where 10 of the 12 counties had hospitals providing obstetrical services in 1980. Only one of these 12 counties, Dallas County, still has a hospital providing this basic health service. Many Black Belt women must travel up to an hour and a half to reach a hospital providing obstetrical services. Also, not having obstetrical services provided locally usually means there is no prenatal care locally available. This will not bode well for Alabama’s historically high infant mortality rate.

Not providing obstetrical services has long been a threat to rural hospitals. If expecting parents must drive past their local hospital to go to a larger facility for something as basic to human survival as the birth of their child, they will be seriously tempted to go elsewhere for other care that could be received locally.

This loss of obstetrical services in our rural hospitals is a visible sign of the financial crisis that our rural hospitals are facing. One of the last steps that hospitals take before closing is to eliminate services that are costing more than they are reimbursed for. This describes obstetrics as well as the emergency department. In Alabama, hospitals are required to have an emergency department to be licensed to operate. Discontinuing emergency department services is not a current possibility. Obstetrics, however, can be discontinued.

The problem is that reimbursement for obstetrical services, whether by Medicaid or private insurance, does not cover the cost of providing this service in most rural hospitals. There are fixed costs required to offer obstetrical services. The hospital must pay a considerably higher liability insurance premium, provide nurseries, provide specialized obstetrical equipment, employ specially trained obstetrical staff, etc. To recover these fixed costs, given the current rates of reimbursement by Medicaid and private insurance, there must be a larger number of births occurring at rural hospitals than are currently occurring.

The solution to returning this vital service to rural hospitals involves having more births, increasing Medicaid and private insurance reimbursement, lowering the cost of providing this service, or a combination of these. Innovative possibilities for possibly accomplishing this need to be sought.

One possibility for lowering or even eliminating the cost of liability insurance for providing obstetrical services could involve a partnership between a rural hospital and a Federally Qualified Health Center (FQHC). FQHCs have their medical liability covered by the federal government. An FQHC could lease space in a rural hospital for obstetrics. This would be considered part of the FQHC and liability costs, for OB/gyns or family practice physicians providing obstetrical services, would be covered by the federal government. The possibility of this partnership has been verified with federal officials.

Other possibilities for decreasing the rural obstetrical crisis could involve re-establishing birthing centers as a type of health care facility in Alabama and better utilization of certified nurse midwives for lower risk births. Alabama authorized freestanding birthing centers back in the 1990s and had rules and regulations in place for the operation of these facilities. Only one such center was opened with this being a service of The Huntsville Hospital.

As previously noted, Alabama is blessed with many wise and innovative residents. Additional ideas on returning obstetrics to rural hospitals need to be sought.

Consider ways to encourage the development of rural county health coalitions:

In the early 1990s, the residents of Escambia County were concerned over local health care after losing their hospital in Flomaton. The result of this concern was the establishing of what is today called the Coalition for a Healthier Escambia County.

This coalition started meeting monthly and still meets monthly today. It includes membership from many components of the county including hospitals, the Poarch Creek Indian Health Department, physicians, nurses, dentists, counselors, mental health, public health, emergency medical services, dialysis, nursing homes, assisted living facilities, human resources, city government, county government, the media, law enforcement, local business, local industry, education, the clergy, etc.

These members meet monthly to discuss local health and health-related issues. With so many components of the county involved, much more complete information on issues is available for consideration. Possible solutions are identified and the coalition operates with one united voice to secure whatever is needed to solve the problem or provide the need.

All rural counties should be encouraged to develop similar coalitions. Such coalitions could work together to help keep their local hospitals open and to satisfy other local needs. What is not related to health? Economic development and education are strongly related to health. Such coalitions could greatly assist local elected officials in identifying current or potential problems and providing local needs, producing a brighter future for their county.

Involve Alabama residents in solving problems:

Many, if not most, good ideas come from those working in the trenches rather than the ivory towers. Alabama needs to establish an innovative program that would empower citizens who may have outstanding ideas with no way to have them heard, to present their ideas for consideration.

The innovation and brain power of our citizens could be harnessed through a program that I am not aware of any other state having. Consider developing a program, perhaps through the Governor’s Office, where postings inviting ideas for solving selected problems or providing selected needs are posted online. Invite the people to assist their government officials by responding with ideas or solutions to the posted solicitations. A small monetary award could be provided to those who provide ideas that are implemented. Solicitations selected for posting could come from any source including state government officials, but would have to be approved to be posted online. Examples of such postings could include soliciting ideas on new revenue streams for our rural hospitals, ideas on how to revitalize the Black Belt Region, ideas on how to return obstetrical services to our rural hospitals, etc.

Monetary awards for workable ideas could come from interest being paid on the unclaimed funds that are being held by the State Treasurer. These funds belong to Alabama’s citizens. Treasurer Young Boozer stated that at any time there will be approximately $60 million in this account.

ALABAMA’S RURAL HOSPITAL CRISIS: A BRIEF DESCRIPTION

Elba General Hospital, Elba, Alabama – Closed in 2013

Alabama currently has eight counties (Cleburne, Coosa, Henry, Lamar, Lowndes, Macon, Perry, and Winston) that do not have a hospital.  Unfortunately, announcements are soon expected about two additional rural Alabama hospital closings, possibly more.  The root problem confronting our rural hospitals is quite simple – lower reimbursement for services.

Alabama’s rural hospitals are reimbursed at lower and inadequate rates compared to urban hospitals.  The Center for Medicare and Medicaid Services reimburses hospitals for services rendered to Medicare patients using a methodology that considers wages paid by hospitals.  This methodology is called the Medicare Area Wage Index.  This index currently reimburses rural Alabama hospitals at the lowest rate in the entire nation, except for a few U.S. territories.  Alabama has one of the most unhealthy and poverty stricken populations among all states; however, we elected not to expand Medicaid.  Federal tax dollars paid by Alabamians are going to provide greater Medicaid benefits for residents of some of the nation’s wealthiest and healthiest states, but not for Alabama’s greater health care needs.  There is current litigation filed against one of the nation’s largest private insurance companies alleging lower reimbursement for the same services provided at our rural hospitals.

Every county in Alabama should have some form of 24-hour health care facility, whether this is called a hospital or some other facility term is used.  Some of Alabama’s most rural counties have higher mortality rates from strokes, heart attacks, motor vehicle accidents, firearm related injuries, and other causes where quick access to health care is of the most critical importance.

In addition, residents of all counties have a moral obligation to provide 24-hour health care for residents of their counties and those who may be visiting or passing through their county.  Most of Alabama’s rural hospitals or medical centers receive some form of local tax or other local financial benefits to assist these vitally important facilities in their financial struggle.  Residents in counties that do not have a hospital or that do not provide financial assistance for their hospital(s) should feel obligated to establish such a facility and to provide additional financial assistance to help it survive.

Rural counties without hospitals are doomed to a slow economic death.  Businesses will tend to locate in areas where their future employees will have better access to life essentials, such as health care.  Think about the many health care providers, services, and facilities that tend to locate in communities that have hospitals.  Think about the absence of these services in counties without hospitals and the loss of these services in counties that have their hospital close.  Without having adequate health care and the economic opportunity that this can attract, where will our children and grandchildren have to go to establish careers?  Thirty-nine of Alabama’s 54 rural counties are projected to lose population through 2040.

The solution to the rural hospital financial crisis is complex and involved.  Several of the greatest needs are beyond our local control.  However, there are several steps that can be taken that are within our control.  These are things that we can do ourselves to financially strengthen our rural hospitals.  Alabama may need to redefine the term “hospital” to better meet the requirements of today.  There is a pressing need to identify new services that our rural hospitals can provide to generate additional revenue.  Ways to use and generate revenue from the many currently unoccupied beds in rural hospitals need to be identified.

Currently, Alabama hospitals must have 15 or more beds and must have an emergency department to be licensed.  It may be time to change our definition of what a hospital must be in Alabama to consider the trends that are being seen nationally.  This definition was adequate back when any physician could admit anyone to a hospital for most illnesses and keep them there as long as they wanted.  This is not the situation any more.  There are rural hospitals in many states, including Mississippi and Tennessee that have fewer than 15 beds.  Patients served in these hospitals are treated and sent home, treated and kept overnight for observation, or stabilized and transferred to more comprehensive medical centers.

A most prominent piece of federal legislation benefiting rural hospitals today is the “Save Rural Hospitals Act (H.R. 2957)”.  A major part of this legislation is to establish the “Community Outpatient Hospital”.  Such hospitals will only have a few beds for keeping patients overnight for observation or as swing beds.  Highly beneficial reimbursement for Medicare emergency department and observational care is the financial incentive for converting to this type of hospital.  Rural Alabama could not benefit from the passage of this legislation since there would be no need for 15 or more beds for observation.

The Alabama Hospital Association is hesitant to support lowering the 15 bed requirement or establishing a new type of hospital that could have fewer than 15 beds.  The reasoning for this lack of support is sound.  According to information recently noted by the CEO of that association, 96 percent of Alabama’s rural hospitals have a net operating loss.  Opening new small-bed-count hospitals to take business away from other hospitals that are already operating at a loss can promote additional closings.  But what about rural hospitals that are rebuilt like the Wedowee Hospital in late 2017?  That facility was forced to build a 15-bed facility even though the administrator indicated that 10 beds would have sufficed.

Alabama needs to look at authorizing rural hospitals with fewer than 15 beds, a process that could take over a year to authorize.  Regulations should initially be established that will allow this concept to be used only when an existing hospital is being rebuilt or could be financially strengthened by decreasing their bed authorization.  New small-bed-count hospitals should be carefully authorized to avoid financially threatening other rural hospitals.

Many states license hospitals with no emergency department in communities where this can safely work.  Emergency departments are one of the most expensive services in a rural hospital.  Emergency department losses are threatening the financial survival of several of our rural hospitals.  It may be possible for some rural hospitals to cease providing emergency department service without seriously impacting the safety of local residents.  This could possibly be done where there is another hospital providing emergency department service close by and the capability of local emergency medical services could be enhanced.  It may be time for Alabama to consider looking into licensing rural hospitals without emergency departments.

A special committee, housed within the Alabama Department of Public Health, is charged with the responsibility of authorizing the types of health care facilities that can be licensed in this state and for developing the rules and regulations for operating such facilities.  The leadership of that department is encouraged to initiate actions looking into redefining rural hospitals to better meet the needs of today.  The Alabama Legislature could also request this action.

To provide financial relief from the lower and inadequate reimbursement for services, Alabama’s rural hospitals need to identify new revenue-generating services that they can provide.  An excellent example of such service is the senior retirement community that was established on the campus of the Bibb Medical Center in Centreville.  An article on this concept was published in the September 2017 edition of the Alabama Living magazine.

Many rural hospitals have unoccupied beds that are producing more additional maintenance costs than revenues.  New ways to use these unoccupied beds need to be identified.  These could be ways that keep the beds as a part of the hospital or that establish something separate from the hospital.  (Dale E. Quinney)

Do you have an idea on additional services that our rural hospitals may be able to provide to generate a new revenue stream?  Do you have an idea on how unoccupied rural hospital beds and rooms can be used to generate additional revenue for the hospital?  Please write a blog describing your idea and email it as an attachment to admin@osral.net.  All ideas will be considered for publishing in this blog (anonymously if desired) and will be shared with stakeholders who need to be informed about your specific idea.