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updated 8:31 PM UTC, Dec 17, 2014

Changes Could Drastically Impact Rural Hospitals

  • Written by Bob Gabrielson
  • Published in News

(9/3/13) Payment cuts aimed at rural hospitals like Black River Memorial Hospital (BRMH) could impact the quality of healthcare Jackson County residents and visitors have come to expect.

A report issued by the Department of Health Services' Office of Inspector General (OIG) regarding Critical Access Hospital (CAH) designation proposes that rural hospitals that do not meet certain location requirements would no longer have the status of critical access hospitals and the extra federal Medicare money that goes with that designation. In Wisconsin, 53 out of the 58 rural hospitals would lose their status. 

The existing criteria certified hospitals in January of 2006 and new criteria based on distances from another hospital have questionable savings calculated by the OIG.

The CAH program has stabilized healthcare for large portions of Wisconsin. Prior to the creation of CAH status, hundreds of rural hospitals closed because they could not financially survive under Medicare's traditional reimbursement structure. The CAH program allows for hospitals like BRMH to use an alternative reimbursement structure to continue to serve the community.

Mary Beth White-Jacobs, CEO of BRMH, stated, "The leadership team has been diligent in planning payment based on Medicare rates and efficiencies for BRMH in the future. It has been recognized in our strategic planning process as well. Bob Daley, CFO, is working with our accounting firm to develop projected costs of losing CAH designation. The Wisconsin Hospital Association has estimated that losing CAH designation would cost BRMH at least $500,000 each year which would impact services available to the Jackson County area. We want the public to know that our facility is not closing, and appreciate the support the community is already giving in light of this report."

Alan Morgan, CEO of the National Rural Health Association, said"Looking at Centers for Medicare and Medicaid Services' data, critical-access hospitals do primary care, and that is where we want our health system headed," Morgan said. "If those patients are not being seen in a rural hospital, are they expecting the patient to go to urban facilities? Or are they expecting them not to seek care? There is a larger issue that is not being talked about here."

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