60 rural Texas hospitals may close if government reconsiders critical access funding

If the Department of Health & Human Services follows a recent recommendation to reconsider funding for the critical access hospital program, dozens of hospitals in the Lone Star State could wind up shutting down, the Texas Tribune reported.

The HHS's Office of the Inspector General issued a report last month suggesting that up to two-thirds of the rural hospitals with critical access designation nationwide should not be reenrolled in the program because they were not appropriately remote. Critical access hospitals receive Medicare reimbursement at 101 percent of their costs as opposed to the lower Medicare rate. Reevaluating the distances of the CAHS-desigated facilities would save Medicare $449 million a year, according to OIG.

>The 35-page OIG study plotted the locations of CAHs and other hospitals onto digital maps to determine whether CAHs would meet the location requirements if they were required to re-enroll in Medicare. The OIG also used 2011 claims data to calculate the potential savings to Medicare if CMS were to decertify CAHs that wouldn't meet the location requirements.

"At the end of the day, if that became reality, we're looking at closing 50 or 60 hospitals in the state," Don McBeath, director of government relations for the Texas Organization of Rural and Community Hospitals, told the Tribune. That would comprise up to 75 percent of the state's 80 critical access facilities. They would lose more than $1 million a year in additional funding, according to McBeath.

Four rural facilities have closed in Texas so far this year, and 64 of the state's 254 counties do not have any acute care hospitals at all, the Tribune reported.

The American Hospital Association, in a statement, blasted the report. Joanna Hiatt Kim, AHA vice president of payment policy, said the recommendations are "completely inappropriate and demonstrates an unfortunate lack of understanding of how healthcare is delivered in rural America."

To learn more:
- read the Texas Tribune article

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