The Ripon Forum

Volume 41, No. 2

April - May 2007 Issue

Health Care in Rural America

By on November 2, 2015

Much has been accomplished, but much more needs to be done.

by DAVIS BEASLEY

As health care reform emerges as a national issue once again, it seems advisable to take a look at how these things play out away from the major cities, state capitals and Washington, D.C.

Ensuring access to needed health care services in rural areas has long been a challenge. As a former Governor of South Carolina and now as chair of the National Advisory Committee on Rural Health and Human Services, I’ve seen this first hand. On a more personal level, my wife and I and our four kids live in a rural area of South Carolina. It is critical for me to know we can get to a doctor or an emergency room if we need it, and we inevitably do.

At a recent meeting of the Committee, which advises the Secretary of the U.S. Department of Health and Human Services (HHS) on rural issues, we took some time to reflect on what’s happened in rural health care over the past 20 years, while also discussing some of the key challenges that lie ahead.

A Period of Turmoil

There have been some real successes since 1987. Twenty years ago, rural America was in trouble. The farm crisis was in full swing. When farms shut down, we lost other rural businesses. We also lost a significant number of the low-wage manufacturing jobs that played a crucial role in rural economies. And this was as true in South Carolina as it was anywhere in the country. At the same time, some 400 rural hospitals closed between 1983 and 1987, due in part to changes in the way Medicare paid hospitals that were designed on an urban-based model.

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Rural Residents have higher rates of unintentional injury and higher death rates than folks who live in urban areas. What’s worse us that these statistics have held steady for the past 20 years.

Either issue in and of itself would have been cause for alarm. Taken together, these situations were causing problems in America’s heartland. That got the attention of policymakers because rural hospitals are the linchpin of a local health care system. If you don’t have a local hospital, it’s hard to attract physicians and other health care providers. There was a genuine concern that rural residents were facing a crisis in access to health care services. Something had to be done.

We’ve also learned that health care and rural economic development are tightly tied. If you don’t have adequate health care services in a town, it’s hard to attract new jobs and industries to that area. So, on a variety of levels, it was clear that something had to be done to help rural communities.

Luckily, the issue got the attention of lawmakers. The Congress and the Reagan administration worked together to create an Office of Rural Health Policy within HHS to make sure there was a rural voice within the policy making process. They also worked to create a program that established a State Office of Rural Health in each of the 50 States.

Much-Needed Reforms

Over the next 20 years, rural health advocates, lawmakers and a number of Administrations worked to identify the problems facing rural health care providers. Slowly, policymakers began to understand the special challenges of providing health care services in small and often isolated rural areas. Through a number of legislative and regulatory fixes over the years, things are looking better for rural hospitals and the communities they serve. One of the more significant changes came in 1997 with the creation of the Critical Access Hospital (CAH) designation, which allowed the smallest and most vulnerable rural hospitals some relief by paying them on a cost basis and allowing for staffing and regulatory flexibility needed to give these facilities a chance to succeed economically. There are now 1,283 of these facilities nationally. We’ve also seen tremendous growth in the number of Rural Health Clinics and Community Health Centers that have been established in rural areas.

Medicaid is also an important payer in rural communities. The 1997 legislation that created the CAH designation also made key changes to Medicaid – changes that provided greater flexibility to States in terms of managed care options and also in reforms to Medicaid Disproportionate Share payments. That made it easier for Governors to adapt Medicaid to the particular needs of their States.

In 2003, Congress also included $25 billion worth of reimbursement increases for a range of rural health care providers in the legislation that created the Medicare drug benefit. This investment was the latest in a series of legislative fixes between 1997 and 2003 that helped to begin addressing some long-standing reimbursement rural-urban inequities in the Medicare program.

Still, many challenges remain, and we’ve seen and continue to hear about them when the Committee holds its meetings in rural areas across the country.

The Challenges that Remain

While rural hospitals have stabilized, some are still struggling and have negative operating margins. Rural areas also still struggle to attract and keep health care providers, particularly physicians. There are now 3,782 primary health care professional shortage areas – or HPSAs – in rural areas, compared to 1,911 in urban areas. The shortages are even more challenging for dentists and mental health care providers. We’re now starting to hear about the struggles of community pharmacists and discussed this issue at length in our 2006 Report to the Secretary (http://ruralcommittee.hrsa.gov).

Americans in rural areas also face a number of other health care challenges. Rural residents are more likely to have chronic conditions than those who live in urban and suburban areas. Rural Americans have higher rates of obesity and limitations on activities of daily living due to health care problems. Rural residents have higher rates of unintentional injury and higher death rates than folks who live in urban areas. What’s worse is that these statistics have held steady for the past 20 years.

It’s also important to provide some context for all of these issues. Rural areas face some distinct socio-economic challenges, with slightly higher poverty rates and an economy that has not had the same growth as urban and suburban areas. These factors become even more of a concern if you drill down a bit. Rural areas along the U.S.-Mexico border, the Delta region and the Appalachian region, for example, face even larger economic and health disparities.

We’ve also learned that health care and rural economic development are tightly tied. If you don’t have adequate health care services in a town, it’s hard to attract new jobs and industries to that area.

In my work with the Committee, I’ve had the opportunity to see how diverse the issues are for rural America. Each year, we do site visits to rural communities to gather information on the ground for our reports to the Secretary. Although many different parts of our country’s rural areas face some common challenges, they also have some very unique circumstances.

What has been amazing is to see how communities are able to overcome these challenges despite the many obstacles. We’ve seen this in places like Bisby, Arizona, Tupelo, Mississippi and Nebraska City, Nebraska, just to name a few. The key takeaway in all of these communities is that they’re working across multiple sectors to address problems. They’ve realized that, given the limited economies of scale in rural communities, they have to work together to survive. They’ve grown their own local leaders, and that investment is paying off. These folks realize that there is no single solution. They understand there are government programs that can help, but that ultimately problems are best addressed at the local level.

Policymakers would do well to remember that rural America makes up roughly 80 percent of our country’s land mass and is home to about 20 percent of the population. As they get more involved in talking about how to tackle health care issues more comprehensively, it is important to remember that regardless of what approach ultimately emerges, any solution should capitalize on the creativity and problem-solving approaches we’ve seen in rural America. It is also critical that we adopt approaches that emphasize local and State flexibility, because we’ve seen first hand that what works in Vermont may not necessarily work in South Carolina.

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David Beasley served as Governor of South Carolina from 1995-1999. Since 2002, he has served as chair of the National Advisory Committee on Rural Health and Human Services, which analyzes rural policy issues for the Secretary of the U.S. Department of Health and Human Services.

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