Bills Would Boost Rural Health

By Kathy Helms, Diné Bureau

June 15, 2007

U.S. Sen. Pete Domenici has joined members of the Rural Health Caucus to introduce a wide-ranging rural health care bill that would improve Medicare and Medicaid payments to physicians who treat seniors in rural, under-served areas.

Domenici, primary co-sponsor of the bipartisan Craig Thomas Rural Hospital and Provider Equity Act of 2007, joined Sens. Kent Conrad, D-N.D., Tom Harkin, D-Iowa, and Pat Roberts, R-Kan., on Wednesday to introduce the bill, which was renamed in honor of the late Sen. Craig Thomas, R-Wyo., who last week died of cancer.

The bill takes several steps to shore up health care in rural states like New Mexico , including an extension of expiring rural health provisions from the Medicare Modernization Act of 2003, the prescription drug benefits law. 

Overall, the R-HoPE Act would extend benefits to all of New Mexico's 27 rural hospitals that serve a disproportionate share of low-income Medicaid recipients. 

It would reinstate the "hold harmless" provisions for small rural hospitals with fewer than 100 beds, provide aid to low-volume rural hospitals, and expand the Medicare reimbursement eligibility to mental health care providers in rural areas, including marriage counselors and family therapists. 

It also would extend provisions included in the MMA to put rural physicians more on par with urban doctors in terms of Medicare reimbursement levels by extending the Physician Fee Schedule Work Geographic Adjustment provisions (set to expire at the end of the year through Jan. 1, 2010. 

Preliminary estimates indicate that the financial impact on New Mexico's rural facilities could result in as much as a 15 percent increase in Medicare revenues, according to Domenici. 

"New Mexico is among large rural states that are consistently challenged to provide health care to their citizens. The state's economic condition has improved, but that does not diminish hardships faced by small town hospitals and clinics in attracting and retaining physicians and health care workers," he said. 

Medicare bases physician payments, in part, on geographic adjustment factors. The geographic index is designed to reflect relative cost differences in a given area compared to the national average. Payments to physicians in rural areas are adjusted downward by the index, thus lowering reimbursements to rural caregivers. 

"In addition, there are many areas where rural hospitals and clinics need special attention because they cannot realistically keep pace with health care demands and rising costs," he said. 

The bill would increase the all-inclusive payment rate cap for rural health clinics from $63 to $92 per patient to more appropriately cover service costs. 

On Thursday, Domenici, U.S. Sens. Jeff Bingaman, D-N.M., and Maria Cantwell, D-Wash., led a bipartisan effort to correct an inequity in the State Children's Health Insurance Program law that prevents New Mexico from covering thousands of low-income children. 

The senators, as well as governors from 11 affected states, including New Mexico Gov. Bill Richardson, are urging the Senate Finance Committee to support the proposal and implement a permanent fix to the problem. 

"The law locks out states that demonstrated leadership on expanding poor children's insurance coverage early on, and as a consequence, New Mexico is being denied access to much of the allotted funding," Domenici said. 

According to Bingaman, New Mexico has one of the highest uninsured rates in the country and is struggling to find adequate health care resources. 

"The current SCHIP law is not working for New Mexico and it must be fixed," he said. Bingaman serves on the Senate Finance Committee that is expected to consider a new SCHIP bill in the coming weeks. 

Through SCHIP, created in 1997, states were granted federal funds to expand coverage to low-income children who did not qualify for Medicaid but whose families could not afford health insurance. However, the law penalizes states like New Mexico that already had expanded health care coverage to many low-income children before 1997, by prohibiting them from coverage under SCHIP. As a result, New Mexico has been forced to return more than $165 million to the federal government since 1998, and could stand to forfeit another $11.9 million this year. 

"In our state, this important program helped us to provide health insurance to more than 15,000 children and low-income adults," said Gov Richardson. "This program will also help us expand health care coverage to an additional 18,000 low income adults this year."

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