Expert Panel Discussion: Health Care Reform:
How Community Hospitals Thrive in an Environment of Rapid Change
Independent hospitals may struggle with capitated and episodic payment reform if their service lines are limited. Movement away from a fee-for-service model not only will require some form of alignment with an integrated delivery network, it will require advanced information systems and seamless movement of data throughout the enterprise. IDNs with an insurance component may be the best prepared for true payment reform.
One of the challenges that I see independent hospitals have is the availability of resources. Specifically, critical access hospitals have to deal with nearly all of the same regulations as IDNs, but often do not have the depth of staff to research and implement process changes and improvements required by health care regulations. Furthermore, the volumes in a critical access hospital make it difficult to shoulder reimbursement cuts from Medicare or Medicaid. I know that critical access hospital reimbursement helps tremendously, but reimbursement at 101 percent of Medicare cost only accounts for about 94 percent of our true, overall cost. With the health care regulations constantly increasing, Community Hospital has had to add positions in the areas of compliance and performance improvement in recent years. This looks to increase further with the number of new regulations and additional governmental agencies called for in health care reform.
The challenges I see for our critical access hospital are meeting the financial pressures that will come from complying with health care reform, achieving meaningful use, HIPAA 5010 and the complexity of ICD-10. If the hospital can meet these challenges, I believe we will have a better chance to compete with integrated delivery networks and provide better patient care at an overall lower cost. Patients will recognize that health care close to home is a viable option for top-notch care.
The biggest challenge for our hospital is that it is very difficult for a rural independent community hospital to afford the many modules needed to achieve meaningful use. In our current financial environment it has been very difficult to get financing for these projects with banks or leasing companies.
We also have six hospitals that are in a one-hour drive of our hospital; most of them are part of integrated delivery networks. We are using technology in our patient care areas to help us achieve a competitive edge against these surrounding hospitals. We believe that it is much easier for a small, independent hospital to make technology changes at a faster pace than a larger hospital network.