Understanding the Evolving Rural Marketplace
Cost, Quality, Access, and Population Health
Andrew Busz, FAHM, Policy Director, Finance
Ian Corbridge, RN, MPH, Policy Director, Clinical Issues
June 24, 2014
How is Rural Different?

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
Geography
Population/Demographics
Payor Mix
Volume of services- Impact on cost per unit due
to higher proportion of overhead costs
 Capitation and risk sharing difficult due to low
enrollment numbers.
The Jigsaw Puzzle of Provider Types in
Rural Areas.
• Combines different approaches to ensure
access to care in rural areas.
• The mix of provider types and degree of
collaboration is unique to each community.
Critical Access Hospitals
 Restricted in some ways, granted greater
flexibility in others compared to larger hospitals
 Cost-based payment for Medicare and Medicaid
Federally Qualified Health Centers
 Specific board structure, including consumers
 Serves underserved clientele in urban and rural
areas
 Provides wrap-around services
 Required to take all comers on a sliding-scale
basis
 Paid an encounter rate by Medicare and
Medicaid FFS, rather than fee schedule
Rural Health Clinics
 Required to employ or contract with mid-level
providers (PA or ARNP)
 Paid an Encounter Rate by Medicare and
Medicaid FFS, rather than fee schedule
 Encounter rate for hospital-based RHCs reflects
hospital cost component
Free Clinics
 Primary clientele is uninsured population
 Primary financial support through donations or
hospital sponsorship
 Clinical care provided by area providers on a
volunteer basis
 Many now closing due to ACA coverage
expansions
Independent Physicians and Clinics
 Paid regular fee schedule by Medicare, Medicaid,
and Commercial Insurance
 Increasingly rare in rural areas due to payor mix
Public Health and Social Service Agencies
 Publically funded
 Focus on population health and preventative
services
 Provides services generally not covered by
insurance
Regional Support Networks and
Community Mental Health
 Funded directly by the state
 Regionally organized
 Generally coordinated with, rather than
integrated with medical services
Population Health and Quality in Rural
Areas – the Current Environment
A Health Snapshot
County Health Rankings, accessed on 6/1/14 http://www.countyhealthrankings.org/resources
What Influences Health
County Health Rankings,
accessed on 6/1/14
http://www.countyhealthrankin
gs.org/resources
Funding Population Health
National Health Expenditures
2010
Other
14%
• Poor incentives
• Eroding funding for public
health
Public Health
3%
• Grants, are they a solution
or a double edged sword
Personal
Health Care
83%
CDC, accessed on 6/1/14 http://www.cdc.gov/nchs/data/hus/hus13.pdf#112
Community Health Needs Assessment
– A Brief Look
Priority 2
Priority 1
0
5
10
15
20
25
Health Promotion
Behavioral Health
Obesity
Tobacco Use
Chronic Disease
Social Determinants of Health/Health Disparities
Access to Care
30
Population Health Quality
• USPSTF prevention screening
recommendations are free under the
ACA… however
• Poor prevention screening across
the state
• Rural residents are less likely to
receive preventive services
The Commonwealth Fund and NORC, accessed on 6/1/14
http://www.commonwealthfund.org and http://NORC.org
Population Health Quality (cont’d)
Mammography Screening
County Health Rankings, accessed on 6/1/14
http://www.countyhealthrankings.org/resources
Rural Quality Measurement
• Largely sheltered from national level measurement
• Us-side vs. Down-side
• Challenge of the “small N”
• Few rural specific measures
• NQF website – 7 measures tagged with a “rural”
designation
• Total NQF measures = 637
• Are rural specific measures needed?
The Managed Care Environment
Managed Care Plans
 Defined population and benefits
 Historically focused on per unit costs
 Short term return horizon
 Risk avoidance
 Historically not responsible for global issues such
as uninsured costs, teaching costs, or overall
population health
Current Managed Care Workarounds for
Rural Providers
 Medicare Advantage: based on FFS cost-based or
encounter rates
 Medicaid: enhancement/reconciliation to shield
plans from higher per unit costs
 Commercial: percent of charge rather than
prospective arrangements
Threats to Critical Access Hospitals
 Cost-based payment/ geographic restrictions
 Provider supervision changes
 Length of stay restrictions/ 96 hour rule
 Inadequate network adequacy standards
Threats to FQHCs and RHCs
“The FQHC/RHC’s unique payment methodology
does not always promote efficiency and value and
increasingly impedes some state’s evolving delivery
system and payment transformations.”
2/24/2014 letter from National Association of
Medicaid Directors to HHS
Making the Transition
Accountable Care Organizations
 Requires large population/geography
 Requires sophisticated data, contracting, and
EHR capabilities
 Ability to provide full range of services
 Barriers:
 Lack of data to manage care
 Restrictions on clinical integration
State Health Care Innovation Project
(SHCIP) and Transformation
 All-payor Database –Claims data
 Availability and sharing of EHR data
 Role of Accountable Communities of Health
(ACH)
 Proper allocation of funding that targets root
determinants of health while maintain viability
of medical infrastructure and access to care
What Direction Will Things Take?
Provider
Payor
Plan
ACO
ACH
Population Health and Quality in the
Emerging World
Supporting Population Health
• Health care will have
greater accountability for
the health of a community
• Do we have the right:
• Partners,
• Resources, and
• Payment structure…
To deliver population
health?
Improving Population Health –
Federal Efforts
• ACA
• Public Health Fund
• Free prevention screening (SUPSTF A & B)
• CMS Innovation Center – State Innovation Models (SIM)
program grants
• Greater focus on population health measures
Improving Population Health (cont’d) –
State and Local Efforts
• State Innovation Bill (2572)
•
•
•
•
Communities of health
Extension program
All payer claims database
Common performance measures
• Behavioral Health Integration Bill (6312)
• State SIM grant application – core focus areas: tobacco
use, obesity and diabetes…
Opportunities to Enhance Rural
Population Health Improvement Efforts
• Local collaboratives with broad representation
• Increased focus on screening and prevention
• Measurement
• Rural specific measures
• Focus on ambulatory care and screening measures
• Use of HIT and new data systems to track and improve
quality
WSHA – Leading Population Health for our
Members
• WSHA will:
• Explore state wide population health goal
• Help support partnerships and collaboration
• Toolkit to support community engagement
• Support the dissemination and spread of new
ideas/best practices across stakeholders
• Work toward aligning incentives to support population
health
Questions and Comments
Andrew Busz andrewb@wsha.org
Ian Corbridge ianc@wsha.org