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Jason Bleak runs Battle Mountain General Hospital, a small facility in a remote Nevada gold mining town that he describes as “here in the middle of nowhere.”
Several years ago, when several representatives from private health insurance companies urged him to offer a contract with a Medicare Advantage plan so that their enrollees could use his hospital, Bleak drive them away.
“Let’s come back to the table with a better offer,” the executive recalls telling them. The representative has not returned yet.
Battle Mountain is located in north-central Nevada, about a three-hour drive from Reno and a four-hour drive from Salt Lake City. Bleak (whose name is pronounced “Blake”) suspects insurance companies simply haven’t recruited enough seniors in the area to need his hospital in their networks.
Medicare Advantage insurers are private companies that contract with the federal government to provide Medicare benefits to seniors in lieu of traditional Medicare. These plans have become questionable payers for many large and small hospitals, with insurers reportedly often slow to pay or not pay at all.
Private plans now cover more than half of those eligible for Medicare. And while enrollment is highest in urban areas, the number has quadrupled in rural areas since 2010. Meanwhile, more than 150 rural hospitals have closed since 2010. since 2010, according to the Cecil G. Sheps Center for Health Services Research at the University of North Carolina. States such as Texas, Tennessee and Georgia closed the most.
The growth of Medicare Advantage has had a tremendous impact on the finances of small rural hospitals that Medicare has designated as “critical access.” Under the designation, government-run Medicare would pay those hospitals more to compensate for low patient volumes. On the other hand, Medicare Advantage plans offer negotiated rates that hospital operators say often do not match traditional Medicare rates.
“It’s happening all over the country,” said Carrie Cochran-McClain, director of policy for the National Rural Health Association, whose members include small-town hospitals.
“Depending on the level of Medicare Advantage penetration in each community, some facilities are seeing a significant portion of their traditional Medicare patients or beneficiaries transition to Medicare Advantage,” Cochran-McClain said. .
Kelly Adams is the CEO of Mesa View Regional Hospital, another rural hospital in Nevada. He said he applauds Battle Mountain’s Bleak for keeping Medicare Advantage plans out of his hospital “as long as he has.”
Mesa View, a little more than an hour’s drive east of Las Vegas, has a high rate of patients enrolled in Medicare Advantage plans.
“Am I going to say I won’t take care of 40% of our patients at the hospital or clinic?” Adams said, adding that it would be a “tough deal” to be forced to turn away patients because they don’t have traditional Medicare.
Mesa View has 21 Medicare Advantage policies with multiple insurance companies. Adams said he had difficulty planning to pay for the care the hospital provided. They either “pay late or don’t pay at all,” he said.
In total, these plans owe Mesa View more than $800,000 for care provided. According to its most recent annual cost report, Mesa View lost about $1.3 million in patient care.
Cochran-McClain, of the National Rural Health Association, said the growth in plans also narrows options for patients because “ongoing contracting under Medicare Advantage often has an impact on disease direction.” depending on specific types of suppliers”. If the hospital or provider does not contract with a Medicare Advantage plan, the patient may have to pay for out-of-network care. That’s not typically the case with traditional Medicare, which is widely accepted.
At Mesa View, patients must drive to Utah to find nursing homes and rehabilitation facilities covered by their Medicare Advantage plan.
“Our local nursing homes are not accepting Medicare Advantage patients because they are not getting paid,” Adams said. But if you are a Medicare direct, they will be happy to take that patient.” (Medicare covers limited nursing home stays after surgery or injury. Long-term care is covered by Medicaid only for those who qualify.)
David Allen, a spokesman for AHIP, an industry trade group formerly known as America’s Health Insurance Plans, declined to respond to specific concerns raised by Bleak and Adams. Instead, he said enrollees are signing up because the plans are “more efficient, more cost-effective and offer better value than original Medicare.”
Sara Lonardo, press secretary for the Centers for Medicare & Medicaid Services, said CMS has acted to ensure “that private insurers are held accountable for providing quality care and coverage .”
Keith Mueller, director of the Institute for Rural Policy Research at the University of Iowa College of Public Health, said the reach of private Medicare Advantage plans varies widely in rural areas. If recent trends continue, enrollment could reach 50% of rural Medicare beneficiaries in about three years with some areas such as the Upper Midwest already higher than 50% and others lower, such as Nevada and the mountain states, but tending to increase.
In June, a bipartisan group of members of Congress, led by Sen. Sherrod Brown, D-Ohio, sent a letter calling on federal agencies to do more to force insurance companies to Medicare Advantage plans pay health systems for the money they owe for patient care.
In her August response, CMS Administrator Chiquita Brooks-LaSure wrote that the final rule issued in April made “impactful changes” to expedite care and address concerns. concerns about pre-authorization before hospitals and patients having to get prior authorization for care to ensure the care will be provided. covered by an insurance company. Another proposed rule, once finalized, could require insurers to provide specific reasons for denying care within seven days, Brooks-LaSure noted.
Hospital operators Adams and Bleak also want more swift federal action.
Bleak at Battle Mountain said he knows Medicare Advantage plans will eventually move to his area and he will have to contract with them.
“The question is how can we match the reimbursement so that we can maintain and keep our hospitals in these rural areas alive and strong,” Bleak said.
KFF health newsformerly known as Kaiser Health News (KHN), is a national newsroom that produces in-depth journalism on health issues and is one of the core operating programs at KFF Independent source for health policy research, polling and journalism.
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