Here & Now

Steve Brenton Criticizes Medicare Reimbursement Proposal

Frederica Freyberg:

Rural hospitals could take a direct hit if new Medicare recommendations are implemented. Under a new federal proposal 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. The feds say the program is bloated, costing the government and Medicare beneficiaries $1 billion a year more than the original intent. In Wisconsin, 53 out of the 58 rural hospitals would lose their status. What does that mean for rural health care in our state? Steve Brenton, president of the Wisconsin Hospital Association, joins us with his take on the impact of this proposal. Thanks very much for being here.

Steve Brenton:

You bet.

Frederica Freyberg:

What was the original intent of this, kind of, 35 miles from another facility?

Steve Brenton:

About 20 years ago, following the closure of hundreds of rural hospitals across the country, congress enacted a special program called the Critical Access Hospital Program that pays small and rural hospitals a special amount in order to continue access in those communities.

Frederica Freyberg:

Now, there was a loophole, though, according to the federal report, that allowed distances to be shorter if the hospitals were considered necessary providers. What happens in Wisconsin if this new proposal goes into place?

Steve Brenton:

First of all, I reject this characterization of being a loophole. I know it was contained in this report. I think it’s sensationalized. Every one of these hospitals we’re talking about passed specific criteria established by the state to get into this program. In some ways this is almost a reverse nullification by the federal government of state sanctioned action that goes back 20 years ago. And without question, without this special status, many of these hospitals, over time, would either close or immediately have to reduce employment and local services provided to local communities.

Frederica Freyberg:

It seems to go without saying, but where would it leave patients who access these hospitals?

Steve Brenton:

Well, it means patients and families, in many cases, would have to travel major distances to receive their basic health care services.

Frederica Freyberg:

How much would each hospital stand to lose if, in fact, they lose this designation?

Steve Brenton:

Probably on average this program is worth somewhere between $500,000 and $1 million a year.

Frederica Freyberg:

I understood from this report additionally, and that’s a big hit for a small hospital, because these hospitals are like 25 beds or less

Steve Brenton:

Yes.

Frederica Freyberg:

But I also understood that patients on average have to pay like an additional $400 for an outpatient procedure at one of these hospitals because of these higher rates. Do they know that?

Steve Brenton:

In some cases they probably do. In most cases this higher amount is paid for by supplemental insurance that these patients have.

Frederica Freyberg:

Okay.

Steve Brenton:

And of course the patients have the option, facing the higher deductible or co-payment, of going into an urban facility, and in most cases they reject that option given the advantages of having health care locally.

Frederica Freyberg:

You know, this federal report almost seems to suggest that many of these hospitals sprung up because of this special designation. Do you reject that as well?

Steve Brenton:

Yes, absolutely. In fact, back in the late ’80s and early ’90s, we had a half a dozen rural hospitals close in places like Cuba City and Frederic and Bayfield. Not one of the current Critical Access hospitals that we’re talking about here sprung up or is new. Well, there is one in Walworth County. But for the most part, every one of these hospitals existed well before the enactment of this program 20 years ago.

Frederica Freyberg:

Now, I’m looking at the list that I found online of Wisconsin’s Critical Access hospitals, the 58 of them. And one of them does seem to me like, really? Do we need this? I mean, I’m sure it’s a wonderful facility, but in Edgerton. It’s only like 13 miles from Mercy in Janesville and another hospital in Janesville. So why do hospitals like that serve this critical access purpose?

Steve Brenton:

Sure, yeah. Hospitals like the one in Edgerton are basic service primary care hospitals that have a following locally by patients. But also, many organizations like that not only provide primary care services, both inpatient and outpatient, they provide long-term care, they help support clinics and provide local services that otherwise would not be there without their existence.

Frederica Freyberg:

I understand that President Obama has recommended something less harsh than this in this way, saying that they could maintain their designation as a Critical Access hospital if they’re within ten miles. How would that affect Wisconsin?

Steve Brenton:

We have eight hospitals that are located within ten miles of another hospital that would be affected by that recommendation, which we also reject.

Frederica Freyberg:

You

Steve Brenton:

We reject any discussion, frankly, of mileage. We believe that the criteria established 20 years ago that has been met by each of these organizations should remain in place.

Frederica Freyberg:

Steve Brenton, thanks very much.

Steve Brenton:

Thank you.