Nearly 30 percent of all rural hospitals in the United States are at risk of closure, including 10 percent at immediate risk of closure. Mixed payment models, fixes that made things worse, and the effect of inflation demand a new look on how rural hospitals are paid and sustained. This week, we welcome Harold Miller, CEO of the Center for Healthcare Quality and Payment Reform to talk about alternative payment models across the rural health industry.
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Audio Engineering & Original Music by Kenji Ulmer
Rachel: Nearly 30% of all rural hospitals in the United States are at risk of closure, including 10% at immediate risk of closure. Mixed payment models, fixes that made things worse, and the effects of inflation demand a new look at how rural hospitals are paid and sustained. So how do rural hospitals identify and advocate for data backed payment reform?
JJ: With a critical look at what’s not working, an understanding of what is working, and a push for a game changing payment model.
Rachel: I’m Rachel Lott.
JJ: And I’m JJ Hodshire.
Rachel: And this is rural health rising.
JJ: Welcome to episode 89 of rural health rising. I’m JJ Hodshire, president and chief executive officer of Hillsdale hospital.
Rachel: And I’m Rachel Lott, chief communications officer.
JJ: So, Rachel, I’ve often cited the data reported by Scott Becker and also contained within the Becker’s healthcare review. And you often stop me and you’ll say, JJ, it’s not Scott Becker who’s told me that he’s reporting on it. He’s reporting and others, not just Becker’s, but others in our industry who report the numbers of rural hospitals that are at risk of closure in America. And when we get that, Rachel, it’s very sobering because we’re a rural hospital. We know that all the payment changes, we know that the challenges of staffing, the challenges of supply chain, you name it, has negatively impacted hospital operations for the last several years. Pre pandemic started pandemic just accelerated it in a lot of places, and some places have slowed it down because of the payments that they received from the federal government. But now they’re back on track to some of these challenges. So, we’ve often cited some very sobering numbers and statistics associated with that on this program and then as we’ve discussed this at conferences and other places. So today we’re going to get it straight from the source.
Rachel: That is right. We are talking with someone who has worked on developing and reviewing alternative healthcare payment models across the industry and has a particular focus on rural health.
JJ: That’s right. Our guest today is Harold Miller, president and chief executive officer of the center for healthcare quality and payment reform. It’s so exciting to have you with us. Welcome to rural health rising today, Harold.
Harold Miller: Well, thanks for inviting me. It’s nice to be here.
Rachel: So, to start, why don’t you tell us a little bit about yourself, your background and your work at chqpr, if we can call it that, the center for healthcare quality and payment reform.
Harold Miller: Sure. It is a long name. I run the center for healthcare quality and payment reform. It was started about 15 years ago because of a realization that one of the biggest barriers to delivering safe, high quality health care is the current payment system. Hospitals and physicians actually get paid less when they deliver better health care, and in some cases, there’s no payments at all for the services that help patients the most. So, our goal is to try and fix that. So, physicians and hospitals are paid adequately to deliver the services that patients need safely and efficiently.
JJ: A little bit about who you are and a little bit about what the organization does, but one of the things that’s very important for us is laying the foundation. And so, we’re going to do that by starting with the why. And we do this on every one of our podcasts. And the reason we do it is we get to know our guests just a little bit better. And so, what I’m most interested in, we’ve had a chance to review some of your work, and today I’m excited to get to dive into it a little bit deeper. But I want to know, and our listeners want to know, what is your why? What motivates you? What gets you up out of bed in the morning?
Harold Miller: Well, every day people die because they receive poor quality health care, because they couldn’t get the services that they needed. And the problem isn’t a lack of money. We spend $3 trillion per year on health care in this country. The problem is that the money isn’t going to the right places. And the only way we will fix that is if people understand the real causes of the problem and the changes that would help solve those problems. So, when I get up every day, I try to do something to help address that. I worked in state government for a number of years. I worked in economic development for a number of years and then was asked by a friend of mine to help her look at the issue of whether hospitals made money or lost money whenever patients got infections. Because this is. The Pittsburgh Regional Health Initiative had worked on a method of trying to reduce and actually eliminate hospital acquired infections and had trouble getting hospitals to adopt those methods. And the question was, why was that? And what we discovered looking into it was that hospitals would actually lose money if they eliminated hospital acquired infections. And that sort of opened the door to then starting to look at all the different aspects of healthcare where people actually were penalized financially for doing a better job. So, I started working in various places around the country and communities with a variety of medical specialty societies to look at different aspects of care and finding these problems and trying to figure out what to do with them. And the problems are very strange in some cases. For example, you might wonder, or maybe you don’t wonder, but people generally get if they have cataracts, they get cataracts done. Their surgery is done on two different days. Many people think that that’s because that’s better. It actually isn’t better. The reason why they get their cataracts done on two different days is because Medicare only pays half as much for the second cataract surgery if it’s done on the same day. Even though what cataract surgeons do to try to prevent infections is that they do each of the cataract surgeries essentially completely independently, and neither they nor the surgery center or the hospital can afford to do the second surgery basically at half the cost. But it’s worse for the patient in many cases, and particularly in rural areas, if people have to travel a long distance to get cataract surgery and they can’t get both eyes done on the same day, and then they’re seeing different visions of different eyes. So, when you look at almost every aspect of healthcare, you will find these things. That’s just one example of things where the patients can’t actually get the best quality care because of something about the payment system. And so, I started working on rural hospitals a number of years ago because of an effort started in Washington State to try to help the rural hospitals there, which led me to develop a greater understanding of why rural hospitals were losing money. And I used to say that Oncology was the most complicated payment system in America, and I quoted that after looking at rural hospitals, that rural hospitals are the most complicated payment system. So that’s a longer winded answer than you probably wanted.
Rachel: That’s exactly what I wanted. That was something that I had read, the part about the hospital acquired infections that I had read from some of the stuff on your website. And it’s looking at and thinking about care in such a different way and finding where are the financial incentives that need to be done the other way around that are not intentional. But that’s how they’ve ended up existing. And I think that is a similar issue of a lot of what we see with rural hospitals. But we’ll get into that.
JJ: Well, certainly the complexities of payment models. And to your point, Harold, oncology, when I was involved early on in Oncology, I honestly thought, wow, you can’t get more complex and convoluted. And then I became a hospital CEO of a rural hospital, and I realized, oh my goodness, you talk about all these payment structures and talk about disproportionate hospital share and all of those things and look backs, and it’s like, wow, it is extremely complex. And so, I appreciate your perspective on that. And so obviously, before we get into all of the payment details, what I’m most interested in is learning a little bit more about the report that you prepare and provide regarding hospitals that are at risk of closure. So, I guess first and foremost is, why do you put the report out? And the overarching question is, how is that calculated? What’s taken into consideration for your numbers?
Harold Miller: Well, the purpose of the report is to prompt action in enough time to actually prevent rural hospitals from closing. You can’t wait until the hospital is in the process of shutting down to try and save it. You have to start when the warning signs first appear. And the methodology is actually quite simple. It looks at whether a hospital has been losing money delivering patient services over the course of several years, because if it has been losing money over the course of several years, and that continues, it’s not going to be able to stay open. So, the methodology looks to see if the hospital has been losing money for several years, and then if it doesn’t have enough reserves to sustain those losses in the future, or if it has been relying on some special source of grant money to help it stay open, that there is no assurance is going to continue. Because if that money would evaporate or leave, then the hospital will not be able to stay open. So, the idea is, let’s identify those circumstances early enough to be able to make sure that they don’t happen, and in some cases, the hospital may end up being fine. It may be a temporary problem, but you want to determine that for sure before you suddenly say, gee, I wish we would have done something several years earlier before this problem occurred.
Rachel: So, what’s the difference between because you have the hospitals that are at risk of closure, and then you have this other subset, I guess, within that group, at immediate risk of closure. So, what’s the delta between those two?
Harold Miller: Well, it’s partly an issue of time. So, if a hospital is losing money and already essentially has negative net assets, in other words, its liabilities are bigger than its assets, so it has no reserves in place, then it’s at immediate risk. If the hospital has some reserves but is likely to spend them down in a few years, or if the hospital is relying on, say, local tax revenues or something to support it. And there’s no assurance that those revenues are either going to continue or that they would be large enough to make up a bigger deficit. If it’s a deficit occurring over time, then those hospitals are listed as being at high risk, but not at immediate risk. And again, the issue there is to make sure that maybe everything will stay fine for the foreseeable future, but one should the community should make sure that they know whether that’s true and not just assume that everything will be okay.
Rachel: So, we know, obviously, payment reform is not a new discussion in healthcare, and especially in rural. We’ve been creating various new payment models, at least since the 1990s that I know of. Off the top of my head with Critical Access, how do you measure the success of those various models, and would you consider any of them to have been successful?
Harold Miller: Well, I think success is relative. The critical access hospital program has been successful in helping a lot of rural hospitals stay open. Unfortunately, the program was originally designed to pay hospitals 101% of their costs for treating Medicare patients. But today, under federal sequestration rules, the hospital only gets 99% of its costs. There’s no business in America that could stay open if it was only getting paid 99% of its cost. And moreover, that payment system only applies to about a third of the patients in the hospital. Private health plans generally pay even less than Medicare. So, while the critical access program has helped, it’s not surprising that even critical access hospitals have closed if they don’t get the kind of support for the rest of their patients that they need. And moreover, a lot of seniors are now starting to sign up for Medicare advantage plans without realizing that they’re basically then denying the hospital a cost-based payment for their care because the Medicare advantage plan is not under any obligation to do that. Other Medicare programs, like the low value, low volume hospital program, have been helpful to the hospitals that have received them by providing higher Medicare payments, but the amounts are not really necessarily based on any actual measure of the cost. So, it’s nice to get more than you would otherwise get, but it’s not nice if it’s not enough to be able to actually cover the cost. And for example, the low volume hospital program only applies to inpatient services, I’m sure. As you know, I think you are a low value hospital, low volume, low volume hospital. And that only applies to inpatient services and not to other services that the hospital delivers. So, all of these programs help a little bit, but they don’t necessarily solve the entire problem that a rural hospital is facing.
JJ: So, you know, Rachel and I spent three days in Washington DC. Not too long ago, and we actually cited the information from your study about those hospitals that are at risk of closing. And some of the conversation was around the LVA because we are a low volume adjustment hospital and then sequestration, right? And so, we’re high Medicaid Medicare population, as most rule hospitals are in our respective communities. For rural, Medicaid is a very large portion of the working poor. These are folks that are either on disability and or that are working but making $8910 an hour. And these individuals then can qualify for Medicaid. Medicare, likewise, as you’ve indicated, pays us better than Medicaid. But still, we’re not making any profitability off of two of our largest patient volume. 70% of our patient volume is Medicaid Medicare. And then the government says such things, Harold, as well, we’re going to cut LVA. We’re going to dismantle programs such as disproportionate share. We’re going to then implement sequestration. And that is a prescription for disaster for hospitals. And no matter how much cash that’s on hand, as you know, at some point that mix, those hospitals are going to close. There is no way around it unless there’s some different type of payment model that is in place for rural hospitals. Now, many people argue with us like, well, why is rule any different? Why should be considered different? For all of those reasons, we just spoke about, right? For the fact that we are serving the disproportionate population, that we are serving individuals who are 70%.
Harold Miller: Well, I would have to say I disagree with you to some extent. I mean, I don’t disagree that Medicare needs to pay better and that Medicaid needs to pay better, but there are many, many, particularly very small rural hospitals around the country that their problem is not Medicare and Medicaid. Their problem is private health plans. Because the dirty little secret of healthcare is that while private health plans pay large hospitals very high amounts of high payments, they pay many small rural hospitals even less than Medicare. And in many cases, I mean, there are states that pay critical access hospitals on Medicaid better than cost much better. And those hospitals are actually facing a problem because private health plans are paying less. So, every payer needs to pay better. But some of the smallest rural hospitals that have been closing, people believe that somehow that is a Medicare and Medicaid problem. And in many cases, it has actually been a private health insurance problem. And we need to shine a clearer light on that because I think a lot of private health plans have been basically getting off the hook with everybody, assuming that they must be doing the right thing. And the problem needs to be solved in Washington when a lot of it comes back to the community themselves and which health insurance plans they’re buying.
JJ: Yeah, and it was actually going to be my second point, which was we don’t have the negotiating power to sit down with the insurance company. So, we do lean on Medicaid and Medicare in those programs. And that’s why a lot of our advocacy efforts as a rural hospital have gone towards that, because of the fact that when I sit down with Blue Cross, they don’t even sit down with me. Blue Cross, Blue Shield, none of those come honest to goodness. They don’t sit down. It is simply, here’s what we’re giving you. In bigger institutions, and this is the distinction I was making in bigger institutions, they ask, well, why is it different? In rule? It’s different because I have no authority to sit at the table and negotiate that price, they tell me, oftentimes far lower than Medicaid and Medicare rates. Here’s what we’re going to pay you. JJ and so that is why we as rural hospitals have often looked towards state and federal government to say, help us solve this problem. But to your point, this is a greater problem that involves those insurance mixes. And so, the concern we have in mergers and acquisitions is, as these mergers and acquisitions occur in communities like Michigan, and they also control health plans, it squeezes rural hospitals like ours. So, when we look to the government, it is truly saying, as a last-ditch effort, number one, suspend sequestration. Number two, what uplifts? Can you give rural hospitals and it has been the fight of our lives. But we do, and we did quote your stats and talk about those that are potentially at risk of closing and those immediate at risk of closing. But one of the things that was interesting I want to talk to you about on your online rural healthcare risk of closing report is that many of the commonly proposed solutions that often are offered by politicians, private health insurance companies don’t work. And I was just hopeful that you could walk us through what that is.
Harold Miller: Sure. Well, the most recent, obviously, is the new federal rural emergency hospital program, in which a small hospital or critical access hospital that converts to a rural emergency hospital can get a new $3 million grant, federal grant each year. But in order to get the grant, it has to stop providing inpatient care. And just imagine what would have happened during the pandemic if none of the rural hospitals had been able to provide inpatient care. The death rate would have even been higher than it was. The New York times called this an excruciating choice, either getting $3.2 million more to cover your deficit or delivering the inpatient services that the community needs. And hospitals shouldn’t be facing that kind of a choice. Another so called solution that the federal government has been pushing for several years, giving the hospital a global budget. So rather than getting paid based on the costs of the services the hospital delivered, it would just get a lump sum of money each year, which means the hospital would get paid even if it delivered fewer services than what the community needs. And it wouldn’t be paid anymore if the community needed more services. So again, imagine what would have happened during the pandemic if a hospital was packed with COVID patients, but it couldn’t get any more money to be able to pay for those additional staff and the additional costs that were needed to treat those patients. So those get proposed as solutions. They don’t work, but everybody waits around to see if that’s going to work. And again, as I said earlier, the problem is most of those so-called solutions focus on the federal government and don’t do anything to solve the problem of private payers. And back at the beginning, you mentioned the issue of data driven solutions. And I think part of the problem is that rural hospitals have not done enough to make the problems that they’re experiencing with private payers clear. And it’s not just the amount of payment in many cases, it’s whether there is payment and when the payment comes. So, if the health plan denies all the claims for some arbitrary reason, and the hospital doesn’t have the staff capacity to rebuild for all those claims, or doesn’t have the cash flow to be able to sit and wait for that, the hospital can be hurt every bit as much by that as the amount that it’s paid. But there is no data available on the accounts receivable and the payment rates for private health plans in rural hospitals. And I think that needs to be more people need to be more aware of that if we’re going to solve it.
Rachel: So, in your latest report that just came out a couple of days ago called A Better Way to Pay Rural Hospitals, you propose a model called patient centered payment. So, can you break that down for us? What is patient centered payment and how is it better than the other models out there?
Harold Miller: Sure. Patient centered payment is intended to pay adequately for the services that patients need, rather than just paying in ways that make more profits for hospitals or health plans. Currently, rural hospitals do two different things for patients, but the hospitals are only paid for one of them. The hospital delivers services to patients when they are sick, but the hospital is also there standing by to deliver services in case patients need them. The hospital is paid when some patient comes in for services, but there’s no payment at all for the hospital to cover the cost of that standby capacity. So, the patient centered payment concept is based on the simple idea that we should pay for both of those services. The hospital should receive a standby capacity payment for each resident of the community, and those payments collectively would generate enough revenue to pay for the fixed costs of having an emergency department inpatient unit and other essential services in the community. The hospital then should also get a service-based fee every time it delivers a service to a patient, individual patient. But the service-based fee would be much lower than the current charges are for services, because they would only have to pay for the extra cost that the hospital incurred whenever it delivers another service, because the standby capacity payment would already have been covering the fixed cost of those services. And then if you have smaller service-based fees, it means that individual patients would be better able to afford the care that they when they need it, particularly if they’re on a high deductible health plan or if they have no insurance at all. So, under this system, if the hospital helps people in the community stay healthier, and if people need fewer services, the hospital would still be able to get enough revenue to ensure that it can deliver the services that patients need. Conversely, there would no longer be an incentive for the hospital to deliver unnecessary services, which is what happens now with the high fees that get charged for individual services. Fire departments don’t support themselves by charging a high fee when there’s a fire. And I don’t think that it makes sense for rural hospitals to have to support themselves by charging high fees to people who happen to be unfortunate enough to have an injury or an illness. We need to be able to pay in a way that makes sense since everyone in the community is benefiting from having the hospital there.
JJ: Remarkable. And I’m going to ask a difficult question as a follow up to that. So, I have a good friend of mine, a congressman that represents our district, Tim Wahlberg, who listens to this podcast regularly and we have state representatives that listen to this podcast regularly and they’ll listen to this one and we will push it out as well. So, I love the concept. It makes sense sometimes if it’s too logical, we got to try to can’t accept it.
Rachel: There’s no way it’s not muddy enough to actually be done.
JJ: It’s really yeah, just kidding. Because it hits at the heart of what we’re dealing with, Harold, in rural health. It really does. And population health management and the list goes on and on. So, in your estimation, so you’ve developed this. How would you propose that this would get implemented? And if we were to take steps, what would they look like to do that? And I guess the follow up to that is what would be our perceived barriers?
Harold Miller: Well, it’s only going to get implemented if people demand it and it needs to be implemented by every payer. So again, this is not something that one should just assume that is going to be a federal solution. It also has to be done by health insurance plans. And health insurance plans are purchased by the people in the community that the hospital is located in. And those health insurance plans are making a lot of money today under the current system, they’re not going to change what they do unless people who live in the rural communities make it clear that they’re only going to buy insurance policies from companies that will pay their local hospital adequately. Doesn’t do any good to have insurance if there’s no place to use it because the hospital has been forced to close. And so, it’s critical that people realize that the financial problems in most rural hospitals are not being caused by Medicare and Medicaid, that they’re being caused by commercial insurance plans, and that includes Medicare Advantage plans. As I said earlier, commercial insurance plans pay the big hospitals a lot more than what Medicare pays. And everybody assumes that the same thing is true in small rural hospitals when in fact it’s exactly the opposite. In many cases, Medicare is the best payer. So, it’s important for people to understand that it’s also their insurance plans that may be doing this. And it’s important for hospitals to let the people in the communities understand that because the only way people will know which health plans are doing the right thing is if their local hospital tells them. So rural hospitals need to, I think, start publishing information on which health plans are underpaying them so that and delaying their payments so the employers and the residents in the community can avoid those plans. I think that’s particularly an issue right now, as I mentioned earlier, with Medicare Advantage, there are a lot of seniors who are now signing up for Medicare Advantage plans based on all the advertising that’s promising them zero premiums and free designer eyeglasses. And what they don’t realize is that they may be putting their local hospital out of business by reducing the proportion of its payments that are coming from traditional Medicare. And again, it’s not just the amount of payments, it’s whether the plans are actually paying claims at all and paying the claims in a timely fashion. I do think the other side of this is that rural hospitals have to be transparent about their costs. Bad behavior by large hospitals and health systems has made most people suspicious that all hospitals are charging outrageously high prices and making big profits. And I think that rural hospitals it’s not true in my experience with most small rural hospitals. And rural hospitals need to make it clear that they are operating efficiently and that they’re charging really only what is needed to be able to cover costs so that people will feel comfortable demanding that they get paid for those costs by their health insurance plans.
JJ: Yeah, there’s definitely a story that needs to be told, and that is the purpose in which we created this podcast to tell the plight of the small rural hospital. And to your point, many big systems that were lumped into in terms of the conversation about, well, you have money and you have my itemized bill said.
Rachel: $3,500 for a single Tylenol, that whole line, which is fair in those kinds of settings. But again, it’s like the transparency we’re.
JJ: In a different position, is what is, I think, so critical. And you hit the nail on the head. The transparency of our small rural hospitals to talk about it, to talk about those frustrations which we have, Rachel, as you know, in the challenges. And we’re not afraid to say mergers that bring two health plans together as one is not good for rural hospitals like ours because they price them themselves and they control the market in those terms.
Rachel: I’ve been known to refer to it as price fixing.
JJ: Yeah, well, there is a little bit.
Rachel: Of that because it feels like that.
JJ: It does feel like it does.
Harold Miller: There are some things that can be done at the state level about that. I mean, state insurance departments, in fact, can start pressuring both for information and to assure that when you say that this is an essential hospital and it needs to be paid adequately, that the state insurance departments can review what health plans are paying and how they’re paying to be able to determine that. And if the health plan isn’t paying appropriately, then it shouldn’t be allowed to sell insurance. That’s why we have insurance regulations to ensure those kinds of things. So, I think that’s another thing that can be done at the state level could also be done. I mean, there could be federal regulation, but I think that’s also things that individual states can do. But it even comes down to the individual community, employers in the community. The hospital itself is a purchaser of insurance for its employees. Can decide that it’s going to start sending its business to the health plans that do the right thing.
JJ: That’s right.
Rachel: With all of the research that you do and the data that you’ve looked at and everything, have you seen a correlation with value and or quality when rural hospitals are acquired by larger systems? Because a lot of times you hear the line that they’re selling is, oh, better quality care, access to capital, blah, blah, blah. But is the quality of care really better for one? And what is the value issue there as well? Because if an independent rural hospital is not charging what a system charges and then the system buys it, that’s what they start charging. Whether or not the quality changes, that is going to impact the value of the care in the end as well.
Harold Miller: Well, there have been some recent studies showing that the claims about better care and more efficiency in large systems are really overblown. That in fact, care often becomes more expensive or at least gets charged more and is also less responsive in terms of community needs. I think the bigger issue is that is the short run versus the long run. Big systems have acquired small hospitals in some cases because people waited too long to be able to do anything and that was the only solution. And then it turns out that several years later, the big system decides to either close that hospital or I think, more insidiously to reduce the services that are available at that hospital and to try to then direct more people to the larger hospital. And I think it’s important for people to understand that a merger is not the best solution. In my opinion. In almost any case, having an affiliation that provides appropriate access to specialists, if that’s what it is, is fine. But that’s different than saying we’re restricted and we can only send patients to that particular hospital whether they are the best hospital or not, or whether they have the best specialists. And so, I think that, again, this is something that I think rural hospitals need to make their communities understand is what will happen if they are forced into that situation and not also be left with. That’s the only available option because no one is willing to get payment adequate to be able to support the hospital as a freestanding entity.
Rachel: It feels to me a lot like the Walmart model of go into a community, set up shop, start offering your super discounted prices. Then when the mom and pop goes out because they can’t compete with you, you can close their little neighborhood Walmart and make everyone drive to the super Walmart. That’s another 15 minutes up the road. But it feels like the same sort of model of how these hospitals get purchased and then to your point, may close later. And I think there could be, I guess we’ll see. But it feels like there could be some potential too for even the rural emergency hospital designation to be abused in a similar way to potentially then put independent hospitals out of business and rural hospitals out of business.
Harold Miller: And that’s why I refer to this as patient centered payment, because it is not patient centered to say you have coverage and you have access to care, but you have to drive an hour to be able to get it. You’re not going to be able to drive an hour for your lab test or your mammogram, and so you’re not going to get good care that way. And all services have to be available in the community. That doesn’t mean that you need to have neurosurgery in the community, but it does mean that you need to have the basic kinds of services that are essential for communities. And again, I think that’s something that rural hospitals have to make it clear. One of the things I found when I looked at the data was that many rural hospitals themselves didn’t understand exactly where they were losing money. The assumption had been that it was inpatient services that were causing the biggest losses. And when I looked at a number of rural hospitals, I found that that was not the biggest loss. The biggest loss was the emergency department and the primary care clinic, because again, health plans were paying too small an amount to be able to support the emergency department or the primary care clinic in a rural area. And those are the two most critical services. So, you can take away the inpatient unit, but you’re still going to then not have enough money to be able to support what the community really needs.
JJ: Oftentimes I say we cannot be everything to everybody. And what we have to focus on with our high quality and low-cost structure is the things that are impacting our community here in Hillsdale and the surrounding areas that we serve. And we watched as several hospitals in our region were purchased by a big system, that those hospitals lost their obstetrics department, their Psych unit, and less services to communities that are plagued with loss of transportation. We don’t have public transportation here in Hillsdale County. We’ve got a city transit that really runs Monday through Friday. Eight to four only will service the small city of Hillsdale Countywide, nothing. And so, when we think about this greater issue, it’s hospitals that are able to sustain themselves. You will have better health outcomes for your patients because they are receiving that care locally and in their backyard. And oftentimes we have people that argue with us, no, it’s better just to affiliate. And then you can send those patients to the mothership and they can get that high quality care? No. If you look at us as a facility, our quality is very high. We really hone in on what we do well. We have great outcomes, and we have lower cost structure. We don’t have 16 vice presidents. We have me, right? We have Rachel. The bench strength is very, very small and shallow. And at the end of the day, the services that we provide our community will not be provided by larger health systems because we know they are a cost to those systems. And so, we look at this as in a certain respect, as charity work, like God’s work, like missionary work, because we know that in our obstetrics department, where it’s primarily Medicaid, we’re going to lose. We know that in our psych unit, we’re going to lose. But these are community assets and needs for our community, and reform is needed. That’s the message of today reform is needed to be able to sustain what we’re doing here for these other services that big hospitals will come in and just totally annihilate from those communities. And could you imagine, Rachel, Hillsdale County without mental health services? We have a nine-bed unit. Could you imagine if those patients would be in jail or boarded in the emergency department with no place?
Rachel: Even with the unit we have, we see that happening because there’s still not enough care, and that’s obviously an issue across the country. But that was one of the things. I probably said that before on this podcast when I interviewed with you for this job, however many years ago, when you said you had a psych unit, I was like, I’m sorry, come again? And that you had built a new birthing center in 2015. I was like, Am I being pranked right now? What are you talking about? Because that’s not what you see rural hospitals doing because of that cost. I guess my very last question would be what is the immediate next step or next best step for rural hospitals to take to start pushing this type of payment model to the forefront of the conversation?
Harold Miller: Well, I would say there’s two parts to the step. One is to make sure to educate their own community about the kinds of issues that we’ve talked about here, what is really causing the problem? Because a lot of this has been driven by incorrect assumptions about what is causing the problem. And then I think the second thing is that if rural hospitals believe that this patient centered approach is a better approach, they need to stand up and say that and say that that’s what they want. Because what’s happening is because there isn’t a coherent proposal coming from the rural hospital community. I think rural hospitals are getting stuck with these bad solutions, rural emergency hospital proposals and global budget proposals. And I think that hospitals need to step up and say, here’s what we want. But it has to be a responsible solution. It isn’t just simply pay us more and pay us higher fees, regardless of what the costs are. It’s pay us for a system that actually will enable us to deliver high quality care at an affordable cost for people in the community and a lot of rural people in the country. And if they all got together and said, here’s what we want, I think you could have a major impact in terms of both health insurance plans and.
JJ: Medicare and Medicaid, and that’s our charge going forward. So, if our rural hospitals are listening to this today, and we know that they are, you’re empowered to tell your story. You’re empowered to be transparent with your respective communities. Start the dialogue as to the why influence through your legislative process, the importance of changing this to protect our rural hospitals. And ultimately, there’ll be pressure applied to the insurance companies. They’ll have to do something because when the entire community rises and the politicians rise, there’s not too many other places that these folks can hide. And so, the key to that into Harold’s point in my takeaway, transparency, education, and awareness, it is so important. And oftentimes, Rachel, we try to tell our story, but we’re so just bogged down in the day-to-day operations that we don’t always get to tell our story. And I think that is what is most critical and important in this journey and definitely a call for a new payment model that must exist to keep our rural hospital sustained. So, thank you so much for joining us today on Rural Health Rising. It’s been fascinating to talk with you. And now we have a better perspective when we start quoting your statistics and your numbers at what is involved in coming up with those. And so, I’m very appreciative today of your insight. And then I’m going to advocate for this. This is patient centered payment. You heard it here, patient centered payment. And our communities across the country, and you’re listening today, you are going to be empowered to make a decision that’s going to save your rural hospitals. You have to start having dialogue about this exact opportunity of patient’s underpayment. So, thank you for joining us today on Rural Health Rising. We appreciate your time and your passion and your hard work. It does go a long way for communities like Hillsdale when we say thank you.
Harold Miller: Well, I appreciate the invitation. And thank you for all the hard work you do delivering care to patients and for taking the time to try to actually get the word out about what would actually help you do a better job.
JJ: Before we close, we like to do a fun segment with each of our guests, and what we ask for is your most unique experience or one of your favorite memories that’s unique to rural life. So can you share with our listeners today something that is just unique to your experience, that you’ve had in a rural setting.
Harold Miller: Well, several years ago, I was driving across Washington State to visit one of the small critical access hospitals there. And it was a beautiful day and the landscape in the state was just stunning. Steep cliffs and rivers and rolling farmland. It was also a little scary, I would say, because at one point I think I drove for a half an hour without passing a single car or a single house. But I drove through active farms, huge farmland, and that is one of the areas of the country that grows the fruits and vegetables that go on our dinner tables every night. And when you look at that and you say, and what in the world would they do without that small hospital in the middle of all that land? It makes you realize how important that hospital is. I would have to say that when I finally did arrive in the town where the hospital was located, I went to get gas for the car and I suddenly realized that I wasn’t sure if there was a gas station in the town. And the only gas station I saw in the middle of town was closed. Fortunately, I discovered that there was gas available at the Grange supply behind the train tracks. But that also reminded me that the things that people take for granted in urban areas may not even exist in a rural community. And that we need to recognize that they are not just miniature versions of urban areas and urban hospitals, but that they need different kinds of things and different attention to be able to deliver what we need from them.
JJ: Exceptional. Well, when you visit Hillsdale, just know we have about 23 guests, so we will treat you well. Okay? You don’t have to go to the Grange. Well, thanks for joining us today. We appreciate your time.
Harold Miller: Thanks again for the invitation. I appreciate it.
JJ: Next time on Rural Health Rising, we’ll have another great conversation with another great guest, so be sure to tune in.
Rachel: And with that, don’t forget to subscribe wherever you get your podcast. And if you like what you hear, leave us a five-star review on Apple podcast and tell others why they should listen to your feedback helps more listeners find Rural health Rising.
JJ: And you can now find us on Twitter. I’m at Hillsdale. CEO JJ Rachel is at rural health Rage, and you can also follow the podcast at rural health pod. Until next time, stay safe, stay healthy, and stay strong.
Rachel: Rural Health Rising is a production of Hillsdale Hospital in Hillsdale, Michigan and a proud member of the Health Podcast network hosted by JJ Hodshire and Rachel Lott. Audio engineering and original music by Kenji Olmer. For more episodes, interviews, and more information, visit rural healthrising.com.