Health Care Law Blog

Health Care Trends

Rural hospitals across the United States struggling to stay open

According to the National Rural Health Association, approximately 50 hospitals in the rural United States have closed since 2010. The number of annual closures is growing. Congressional healthcare budget cuts and policy changes significantly affect rural hospitals because rural hospitals often have a disproportionate number of patients who are covered under Medicare, Medicaid or who are uninsured. A number of factors affect and pose challenges to rural hospitals. One challenge is the difficulty of attracting talent, which often means paying more to healthcare professionals in order to recruit them for employment at a rural hospital.  Other challenges facing rural hospitals include:

• changing demographics;
• advances in medical practice that the hospital may be unable to implement;
• new federal regulations and standards that create additional compliance related pressure; and
• lower reimbursement rates for Medicare and Medicaid.

Closures of rural hospitals may force individuals to travel long distances for medical care, which may lead to an increase in mortality rates. The closures may discourage business ventures in rural areas due to the increased costs associated with not having a healthcare facility nearby. Metropolitan hospital closings have increased recently, but the existence of medical care alternatives in metropolitan areas typically reduces the effects that closures have on patients. 

Number of independent physicians on the decline

The changing landscape of healthcare and the current trend of health systems buying physician practices have contributed to the decline of independent physicians. The decline is further fueled by complex government regulation and standards, costly business and management expenses, and technological advances. According to the Orlando Sentinel, recent data from Accenture projects the percentage of independent physicians declining to 33 percent in 2016, down from 57 percent in 2001. CareCloud's "Practice Profitability Index," a 2014 report based on data from an interactive survey and discussion groups that included 5,064 physicians, found that:

• the percentage of participants considering selling is up from 21 percent to 24 percent;
• 11 percent of participants in the study were actively looking to sell; and
• 10 percent of participants in the study had already sold their practice.

HHS: 10.2M currently enrolled in ACA coverage

The New York Times reported that the number of Americans enrolled in health insurance under the Affordable Care Act ("ACA") has dropped to approximately 13 percent because many failed to pay their portion of their health insurance premiums. Federal officials announced that as of March 31, 2015 10.2 million individuals were enrolled in coverage through the Federal and State Insurance Marketplaces, a reduction from its earlier announcement of 11.7 million enrolled individuals. The Centers for Medicare and Medicaid Services data shows that "2.9 million state-run exchange customers are enrolled and paid up, and 7.3 million Federal marketplace customers are enrolled and paid up." This is an increase from 2014 figures.

Many Americans who receive subsidies through the Federal exchange are at risk of losing their subsidies if the Supreme Court decides in favor of the plaintiffs in King v. Burwell. The plaintiffs in King challenged a U.S. Treasury regulation issued under the ACA, which provides subsidies for coverage purchased through both state and federal exchanges. The plaintiffs challenged the regulation on the ground that the ACA authorizes tax credits only for individuals who purchase insurance on state-established Exchanges. 

Categories: Health Care Reform, Hospitals, Insurance, News & Events, Physicians, Tax