Could Medicaid expansion save Kansas’ rural hospitals?
Crystal Metcalf has painful gynecological disorders that make it difficult to hold down a job or take care of her four children. She counts on having reliable health care nearby to keep her life together.
When she learned at the end of last year that Mercy Hospital in Fort Scott was closing, she felt her safety net unraveling. Now, it’s a 30-minute drive to Mound City or sometimes more than an hour to Overland Park for treatment of her endometriosis and polycystic ovarian syndrome.
“To get decent care, we have to go all the way to Kansas City,” said Metcalf, 38. “So it’s frustrating.”
Nearly 90 rural hospitals across the country have closed their doors since 2010; another 355 are considered at risk for shuttering, beset by low patient volume, staffing issues or inadequate Medicare reimbursements. Fort Scott joins Independence, Oswego and Horton as Kansas communities where residents like Metcalf feel vulnerable and on-edge.
Places like Fort Scott, a town of 8,000 in Bourbon County, about 90 minutes south of Kansas City, are at the center of the debate in Kansas over the expansion of Medicaid now allowed by federal law. Kansas is one of 14 states that has yet to grow the program, which provides health coverage to low-income individuals and the disabled.
Under federal law, states that broaden Medicaid eligibility to up to 138 percent of the federal poverty line ($34,600 for a family of four) will receive extra money to help cover the costs, estimated for Kansas at somewhere between $34 million and $47 million a year.
Proponents contend expansion could have saved Mercy.
“This should not have happened,” Gov. Laura Kelly said when Mercy closed. “Simply put: if Kansas had expanded Medicaid, Fort Scott would still have a hospital.”
The Kansas House approved expansion last month, but it remains in limbo, bottled up by Senate Republicans. Kelly tried to turn up the heat last week, accusing the GOP of “stall tactics” and “bait and switch.” She considers expansion one of her administration’s highest priorities.
But in Fort Scott, Medicaid is seen as only a piece of a complicated health care puzzle. In many respects, the town has moved on.
‘Not a silver bullet’
Diagnosing just why a rural hospital closes is tricky. Long before Mercy pulled out, many Bourbon County residents were already heading to Kansas City and Joplin for their treatment or surgery. In 2017, the hospital registered 102,000 outpatient visits and just 200 inpatient surgeries.
That left too many empty beds, said Reta Baker, Mercy’s former president.
There are other factors. Rural hospitals have trouble recruiting and retaining medical workers. They also serve a patient population that is often poorer and sicker than in other areas. Those factors can lead to lower reimbursement rates.
Medicare reimbursements have stayed basically flat since the 1990s, failing to account for any inflation. For rural hospitals, which may have as much as 60 to 80 percent of their business as Medicare, that has spelled trouble.
“When you have that much of your volume in one payer, any variation downward in the reimbursement can have a very disproportionate impact on their operation,” said Brock Slabach, vice president for member services at the Kansas Rural Health Association.
High uncompensated care costs, a consequence of uninsured patients and pro-bono care, compounded Mercy’s problems. By 2017, Bourbon County’s uninsured rate was almost 13%, significantly higher than the 8.5 percent state average. Twenty-two percent of its residents relied on Medicare.
Another major issue for Mercy is that it fell outside of eligibility for federal designation as a “critical access hospital,” meaning one with 25 beds or fewer that is 35 miles or more from another hospital. Without the “critical access” tag, Medicaid reimbursements are lower.
The Kansas Health Institute estimates about 130,000 Kansans would enroll in Medicaid if the legislature expands coverage. But it would have a minimal impact in Fort Scott. About 6% of its population—families that can’t afford private insurance but make too much to qualify for Medicaid—would be eligible for coverage under the proposed expansion.
“I think the general consensus of rural health experts is that Medicaid expansion is not a silver bullet,” Slabach said.
“I don’t think that’s the whole issue for rural Kansas hospitals,” Robert Uhler, Fort Scott’s community development director. “I think it’s a much broader issue than just that. I think it’s a whole changing landscape of what rural medicine’s going to be.”
‘Filling the gaps’
After the St. Louis-based Mercy announced its departure, Fort Scott looked locally and regionally to patch together a new system. Community Health Center of Southeast Kansas, or CHC/SEK, a provider with roots in Pittsburg, took over primary care offices in the main hospital building, along with clinics in town and in two neighboring counties.
Bourbon County took over ambulance service from Mercy. Ascension Via Christi, the state’s largest healthcare organization, now operates a 24-hour emergency room.
About 90 percent of Mercy’s employees were able to keep their jobs, and most patients were able to keep their same doctor.
It’s a model similar to one developed by the Kansas Hospital Association called the Primary Health Center Model, a financially sustainable alternative for low-volume, rural hospitals that don’t qualify for the “critical access” designation.
“It kind of merges some of the things that a physician’s office does with the emergency access piece that an emergency room in a hospital gives,” said Jennifer Findley, vice president of KHA’s education foundation.
Findley said they want to test the model in a handful of Kansas hospitals, but have yet to get the green light from federal agencies.
There are still gaps left by Mercy’s departure. The 46 inpatient beds are gone, along with surgeons and some specialists like cardiologists. Prenatal care remains, but labor and delivery has left town.
Even with an emergency room and primary care, the changes makes some residents nervous. Ruby McManis, 67, has type 2 diabetes and relies on her husband to drive her to and from medical appointments.
“It’s a big concern,” McManis says. “If I fell off of my steps or took a nose dive in a corner, and was bleeding very badly or brain swelling or something, what am I going to do?”
The important needs are still covered, said Robert Uhler, Fort Scott’s community development director. Primary care, emergency services and diagnostic imaging (x-rays and CT scans) are available. Patients with more serious problems can be transferred by ambulance or helicopter to the hospital in Pittsburg, 30 miles away.
Uhler said CHC officials have talked about bringing in more specialists and offering a small number of “swing beds” which could house patients as they recover from surgery in other hospitals.
The hope is that the new model will be more efficient and effective at preventing hospital stays. But low medicare reimbursements and uninsured care will still be a challenge. Officials said it will take federal grants, more community collaboration.
For the time being, it will have to do. CHC and Via Christi have a two-year lease in the old Mercy building. Both providers say they’re interested in remaining after the lease is up. With the city and county running EMS, Uhler said the future of Fort Scott is going to be all about sticking together, and not taking healthcare for granted.
“We got punched,” Uhler said. “But I think actually, we’ll be stronger in the end.”