Nero is infamously known as the emperor who "fiddled while Rome burned." Particularly interesting since its thought he started the fire in Rome himself. It seems that there are groups of politicians in Washington who are set on a similar course with rural health care. Due to a lack of legislation on the extension of the Medicare dependent hospital program (MDH) and low-volume hospital adjustment (LVH) Washington is fiddling while rural is burning.
In 1982 Congress passed TEFRA which radically changed hospital reimbursement from a cost-based system to the prospective payment system (PPS). This Johns Hopkins and Harvard devised scheme was never tested in a small-volume environment prior to its sweeping change. As a result, close to 400 hospitals, mostly all small and rural, closed by 1995. During this period of time Congress was scratching its head and wondered why. Something must be done.
So, in 1990 Congress developed the MDH program and in 2005 they implemented the LVH program in order to stabilize the deleterious effects of the PPS system on small-volume facilities. In 1997, due to continued stress on our smallest of rural hospitals, Congress passed the Balanced Budget Act (BBA) which created the critical access hospital (CAH) program.
We’re long to criticize the government for programs that don’t work. Well for once, the impact of these three vital programs stabilized the operations of many small rural hospitals through the end of the 90’s and all the way through the 2000’s. In 2010, the LVH program was altered by the Affordable Care Act (ACA) and made even more relevant and useful for small rural PPS facilities.
NRHA believes that these three programs are alternative payment methodologies meant to offset the negative effects of the PPS system on small rural hospitals. These payment methodologies are NOT bonuses, gifts or special payments. We’ve long made the case that small, rural hospitals are not miniature versions of large, urban hospitals. Had the government in 1982 cared enough to get a payment system that worked for small rural hospitals, we wouldn’t be in the fix we are today.
For budgeting reasons, Congress inserts “sunsets” on many pieces of legislation. We’re now in a cycle where the MDH and the LVH must be reauthorized by September 30 of each year, or the benefit goes away. It has been convenient that a moratorium on the implementation of the Sustainable Growth Rate (SGR) formula has been “must pass” legislation by December 31 of each year. It has been through this legislative vehicle that the MDH and LVH programs have been renewed. NRHA is working hard to ensure these vital programs are renewed as part of the SGR fix.
Unlike the Romans in Nero’s day, we’re blessed to have recourse through our elected representatives to Congress on these important issues. Please contact your legislator and urge them to renew MDH, LVH and block radical changes to the CAH program. NRHA has resources available online at www.ruralhealthweb.org. Time is of the essence, act now.