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Can two hospitals continue to exist?

The bill for billions in drunken-sailor federal spending on bailouts, war, and pork-barrel stimulus projects is coming due, and Marion County is about to be hit with more than its fair share of the tab.

Congressional deficit-cutters are poised to make a seemingly minor change in federal health care regulations that could force the Marion and Hillsboro hospitals to merge or resign themselves to fighting intolerable, some would say fatal, cuts in Medicare reimbursement.

Medical centers like St. Luke in Marion and Hillsboro Community serve as what the federal government calls “critical access hospitals.” As a result, they receive Medicare payments equal to one percent more than the actual cost for the services they provide — an extremely thin profit margin that barely allows hospitals to stay solvent while making needed upgrades.

Congressional deficit-cutters are considering changing requirements for the designation. Technically, each “critical access” hospital must be at least 35 miles from any other hospital or be certified by the state in which it is located as a “necessary” health care provider. President Barack Obama recently proposed eliminating eligibility for state certification for hospitals within 10 miles of other hospitals. Congressional conferees moved that to 15 miles. Under that rule, the Marion and Hillsboro hospitals would become 3.9 miles too close to each other to receive the designation.

Without the designation, Medicare, which pays for a huge portion of hospital bills in aging rural communities, would begin reimbursing both hospitals not for their true costs, plus a very slight margin, but for 15 percent LESS than the actual cost of services provided. Higher rates for other patients or local taxpayer subsidies would have to substitute for the uncovered costs, which generally could not be passed along to patients. In all likelihood, this would be a terminal prognosis for both hospitals.

If Sen. Jerry Moran, Sen. Pat Roberts and Rep. Tim Huelskamp fail to stop this change, which clearly should be the top priority this legislative session for their Marion County constituents, the only option left would for the hospitals to merge.

Given that Hillsboro’s proposed new hospital has been delayed by its operator’s filing for reorganization under bankruptcy laws, St. Luke, currently finishing a major renovation, would be the only viable candidate to continue.

Residents of the county have been increasingly willing to consider cooperation and consolidation, but such a move would go far beyond what most people in Hillsboro — and, for that matter, Marion — would consider tolerable, particularly when the “cooperation” would be forced upon them by the federal government.

Federal regulations regarding how Medicare reimburses “critical access” hospitals already have played too big a role in shaping the nature of local hospitals. To qualify, hospitals must limit the average patient stay to no more than 96 hours and may provide no more than 25 beds total for inpatient and skilled nursing services. They also must provide 24-hour emergency services either on site or on call. The same rules would forbid a merged hospital from operating a satellite facility within 35 miles of its main facility.

It was nice of the federal government, which pays only a portion of Medicare bills in other areas, to recognize the unique challenges of rural health care by granting “critical access” hospitals compensation roughly equal to the actual cost of services. As usual, however, whenever the government gives something, it takes other things away, and when we depend upon the federal government to continue providing essential subsidies, it has a habit of pulling them away.

About all we as citizens can do is hope our elected officials are not asleep at the switch. If you care about keeping two hospitals in Marion County, give them a wakeup call: Moran at (202) 225-2715, Roberts at (202) 224-3514 and Huelskamp at (202) 225-2715.

— ERIC MEYER

Last modified Nov. 17, 2011

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