Introduction
In 1977, Congress passed the Rural Health Clinic Services Act (PL
95-210). The legislation had two main goals: improve access to primary
health care in rural, underserved communities; and promote a collaborative
model of health care delivery using physicians, nurse practitioners
and physician assistants. In subsequent legislation, Congress added
nurse midwives to the core set of primary care professionals and
included mental health services provided by psychologists and clinical
social workers as part of the Rural Health Clinic (RHC) benefit.
Improving access to primary care services
in underserved rural communities and utilizing a team approach
to health care delivery are still the main focuses of the RHC
program. |
Improving access to primary care services in underserved rural communities
and utilizing a team approach to health care delivery are still
the main focuses of the RHC program. The law authorizes special
Medicare and Medicaid payment mechanisms for rural health clinics
and uses these special payment mechanisms as the principal incentive
for becoming a Federally-certified Rural Health Clinic. For Medicare,
the payment mechanism is a modified cost-based method of payment.
For Medicaid, States are mandated to reimburse Rural Health Clinics
using a Prospective Payment System (PPS). Federal law allows States
to use an alternative payment method for Medicaid services, as long
as the payment amounts are no less than the clinic would have received
under the PPS method.
As will be detailed later in this guide, a RHC may be a public
or private, for-profit or not-for-profit entity. There are two types
of RHCs: provider-based and independent. Provider-based clinics
are those clinics owned and operated as an "integral part"
of a hospital, nursing home or home health agency. Independent RHCs
are those facilities owned by an entity other than a "provider"
or a clinic owned by a provider that fails to meet the "integral
part" criteria.
The mission of the RHC program has remained remarkably consistent
during the lifetime of this unique benefit. Improving access to
primary care services in underserved rural communities and utilizing
a team approach to health care delivery are still the main focuses
of the RHC program. The information found in this book is geared
toward those individuals and organizations that share that mission.
There are over 3,000 Federally-certified RHC located throughout
the United States. The RHC community is almost evenly split between
independent clinics (52 percent) and provider-based clinics (48
percent). According to a national RHC survey conducted by the University
of Southern Maine (USM), independent clinics are most commonly owned
by physicians (49 percent) and provider-based clinics are most commonly
owned by hospitals (51 percent). Approximately 43 percent of RHCs
are located in Health Professional Shortage Areas and 40 percent
are located in Medically Underserved Areas.
Also according to the University of Southern Maine, 69 percent
of all RHCs are located in ZIP codes classified by the Department
of Agriculture as small towns or isolated areas. A small town or
isolated area is a community with fewer than 2,500 people. Another
17 percent of clinics are located in so-called "large towns".
These are communities with populations between 10,000 and 49,999.
The majority of the remaining clinics are located in areas defined
as suburban.
Each of these clinics was located in a Federally-designated or
-recognized underserved area at the time the clinic was certified.
In addition, all of these facilities are located in non-urbanized
areas as defined by the Bureau of the Census. Despite the tremendous
growth we have seen in the RHC program over the past decade and
the considerable contribution RHCs are making towards alleviating
or eliminating access to care problems, thousands of rural communities
continue to receive the underserved designation.
Rural communities have historically had difficulty attracting and
retaining health professionals. For some rural communities, the
inability to access the health care delivery system may be because
there are no health care providers in the area. The lack of health
professionals may be due to the fact that rural communities are
disproportionately dependent on Medicare and Medicaid as the principle
payers for health services. In the typical Rural Health Clinic,
Medicare and Medicaid payments account for close to 60 percent of
practice revenue. Consequently, ensuring adequate Medicare and Medicaid
payments is essential to the availability of health care in rural
underserved areas.
There was tremendous growth in the RHC program through the early
90s. Between 1990 and 1997, nearly 3,000 clinics received
initial certification as a Rural Health Clinic. Since 1997, hundreds
of new clinics have been certified to participate in the program,
however, many clinics approved in the early 90s have chosen
to discontinue participation in the program. Consequently, we have
seen a slight drop in the aggregate number of clinics.
The year 1997 is considered a threshold year for the RHC community
because it was this year that Congress enacted legislation to better
target growth in the RHC program. While the growth in the RHC program
during the early and mid-90s was not unexpected, there were some
in Congress that felt that some of the clinics certified as RHCs
during this period were not really appropriate for participation
in a program aimed at improving health care in underserved areas.
For example, it was discovered that the Medically Underserved Area
list used for participation in the RHC program had not been updated
by the Federal government since
the early 1980's. This meant that some communities that may no longer
have been underserved were deemed eligible for participation in
the program. One of the changes Congress enacted in response to
this discovery was that new RHCs can no longer be certified in areas
where the shortage area designation is more than three years old.
As successful as the program has been for thousands of rural communities,
the fact is that the Rural Health Clinics program may not be appropriate
for every rural underserved community. While the payment methodologies
available to Rural Health Clinics can be attractive, they are not
magical. Indeed, depending upon the payer mix or range of services
you offer or plan to offer, traditional fee for service or some
other form of payment could be better. It is important, therefore,
that you complete the financial assessment included in this publication
to make sure that the methodologies are right for your particular
practice.
The purpose of this book is to walk the reader through the steps
that are required to become a Federally-certified Rural Health Clinic
and complete the necessary financial audit to determine the clinic's
per visit rate.
If you are looking for a way to stabilize the availability of primary
care services or make primary care services available in a community
that has had difficulty recruiting or retaining primary care health
professionals, then we encourage you to learn more about the advantages
of operating your practice or clinic as a Federally-certified Rural
Health Clinic.
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