Under the Affordable Care Act, small rural hospitals like Aultman Orrville are facing uncertain changes.
Aultman orrville Hospital, formerly Dunlap Community Hospital, in orrville, is one of Ohio's 34 critical-access hospitals.
CAHs are small, rural hospitals that offer essential services such as 24/7 emergency care, according to the Medicare Rural Hospital Flexibility Program.
Under the Affordable Care Act, hospitals such as orrville are facing uncertain changes, said Matthew Stewart, associate vice president of finance and CFO for the hospital.
"A lot of small hospitals just won't be able to survive in the new landscape," he said.
That is why orrville, a 25-bed facility in Wayne County, partnered with the Aultman Health Foundation, becoming a subsidiary of the Canton-based medical organization in January 2012.
Nearly half of orrville's business is government based — about 25 percent to 35 percent of patients are covered under Medicare and another 15 percent under Medicaid, Stewart said. Because Ohio elected to expand its Medicaid program under the health care law, Stewart expects that percentage to increase over the next three to five years.
Right now, CAHs receive Medicare reimbursement based on reasonable cost, compared to many urban facilities that just receive a flat payment, he said.
There has been talk of that changing under the new health care law, he said.
"Medicare is a significant portion of our business," he said. "If the reasonable cost basis ... goes away that certainly would be a burden on us financially."
The partnership with Aultman will allow the hospital to build efficiencies and integrate systems and processes between orrville and Aultman's Canton campus, he said, adding that it prepares the hospital to be successful under Medicare.
The partnership also helps orrville weather some of the other changes created by the health care law.
The law requires hospitals to switch to electronic health records by 2015 or face a penalty, Stewart said, and partnering with Aultman helped orrville make the huge investment required.
It also is helping the hospital handle changing quality requirements.
Right now, CAHs aren't involved in same quality of care requirements or reduced readmission incentives that other hospitals are, but that's changing, Stewart said. "We know it's going to be coming."
The hospital created a position, which works closely with Aultman in Canton, to focus on quality and prepare facilities for reducing readmission, he said.
The hospitals also operate under a "triple lean" principle: Better service, better outcomes, plus lower costs, equal value, he said.
One of the keys is coordinating care better. Making sure that everyone, from the physicians office to the nursing home, is connected, he said.
When everyone is working together toward the same goal, you'll end up reducing costs and increasing quality, he said.
Partnerships such as orrville's are going to become more common, he said. All hospitals are going to have to figure out how to cut costs without limiting access to patients.
One of the most important things to a rural community is access to health care, he said. "A lot of times, rural areas don't have access to primary care physicians or hospitals very easily."
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