Illinois
COMMENTRY

Good things come in small packages

Illinois' rural hospitals are at a precipice, forced to change or perish.

Barbara B. Dallas

The insured population has fled leaving an older and poorer population overall. Rural hospitals, doctors and clinics are in a fragile financial condition due to a high dependency on government-sponsored patients. Fifty-five to 60 percent of Illinois rural hospitals' business is Medicare and Medicaid, and for some institutions, the number is closer to 80-90 percent. The average operating margin of Illinois rural hospitals with under 50 acute beds is -3.5 percent. The cost of underpaid and undercompensated patients has shifted to patients with insurance, a capability that is not a long-term possibility because of the managed-care movement. Advancements in medical technology are good news for consumers, but hospitals lack capital dollars for technical equipment and physical plant reconfiguration.

In addition, thanks to technology, in-patient care business is disappearing. In 1983, 4.2 beds were needed per thousand population; last year only 1.5 beds were needed.

Public perception continues to be a problem. Bigger is not necessarily better. Routine procedures are performed just as well by our local providers, and the care is more personal. While the public would like emergency rooms, local access beds and specialty services, many hospitals cannot meet the cost. All of us must make the mind-shift from thinking about our health care system as taking care of sick people and start thinking of it as a system to keep people healthy. And, yes, when they're sick, take care of them.

The historic Balanced Budget Act (BBA) passed last year will force most of the country's health care delivery systems into restructuring as providers cope with the bill's provisions. The plan cuts Medicare spending by $116 billion over the next five years. Medicaid takes a $14 billion hit.

Small rural hospitals have been transitioning for years by making operational and staffing cuts and bed reductions, entering into shared service and networking arrangements, entering into contract management relationships, consolidating, affiliating and merging. Some have not survived. In Illinois, 11 small rural hospitals have closed in as many years.

Non-hospital health care options now include rural health clinics, ambulatory surgery treatment centers, long-term care facilities, nursing homes, skilled care facilities, facilities associated with the freestanding emergency room and recovery center pilot projects, physician offices, and various other options. But none offer what rural residents want — 24-hour-a-day emergency services and the convenience of overnight acute care beds.

Several transformational models are emerging. Other new ones will be fueled by the Medicare rural hospital flexibility plan, passed in the BBA. The Illinois Hospital and HealthSystems Association (IHHA) is working with the Illinois Department of Public Health's Center for Rural Health to develop a rural health plan, as required by the new law.

I believe telemedicine, which includes everything from telephone systems, facsimile transmissions, teleradiology, and interactive teleconferencing, will be a vital, if not indispensable, component in health care delivery in rural America. It will improve quality by bringing specialists via an electronic signal to hospital emergency rooms and even into the homes of patients. It will help provide continuing education and address many other administrative and operational needs.

The future of the rural hospital will, in many respects, ultimately be tied to other, in most cases, larger facilities. The technological changes will warrant both financial commitments and expertise that are not available in rural hospitals.

So, what's the small rural hospital vision? Some already have begun to move toward consolidation, alignments with other providers, elimination of certain

Barbara B. Dallas is senior director of rural hospital services for the Illinois Hospital and Health Systems Association. Based in the association's southern regional office in Carbondale, she lives in Murphysboro and represents more than 90 small rural hospitals in Illinois.

ILLINOIS COUNTRY LIVING FEBRUARY 1998

services, and diversification into more outpatient and community services. Others are only beginning to look at their options. Still others may be able to realign their services and survive as independent institutions. Each hospital will respond to profound changes in its own unique way. The sooner health care leaders examine options and plan for the future, the greater their ability to create the most appropriate approach for the future.

The next generation of rural providers will be financially lean and technologically linked. They will emphasize the appropriate kinds of care for their rural community and efficient operations to ensure that care. The rural hospital of the future may well be small in size, but bigger in capabilities. It will guarantee not only access to care, but also quality, efficiency, and effectiveness, which people in rural Illinois deserve.

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