New Medicaid Rules Could Ease Rural Health Care's Problems

A sweeping Medicaid change has the potential for states to address the dangerous shortage of doctors outside urban and suburban areas.
by | May 2, 2016
A sign outside one of a growing number of rural hospitals that are closing across the country. (AP/Gerry Broome)

The Obama administration released a new set of rules last week for managed care plans under Medicaid and the Children’s Health Insurance Program (CHIP). The document, clocking in at 1,425 pages, mostly strengthens and modernizes existing rules. But there are some sweeping changes.

Perhaps most notably, states now must set “maximum time and distance” standards to ensure that there are enough doctors in the right places. What the maximum time and distance will be is left up to the individual states to decide.

This has the potential to be a game-changer for rural areas, which have more Medicaid patients but far fewer doctors than urban areas. While 21 percent of rural residents are on Medicaid -- compared with 16 percent in urban areas -- only 10 percent of doctors are located in rural areas.

Health officials, though, wonder -- and worry about -- how these standards will be executed.

“How does a state like Nevada write such a standard when most people live in one area?” said Maggie Elehwany, government affairs and policy vice president for the National Rural Health Association. The sparsely populated state has a high concentration of people in the southern part, which could make it difficult to create a standard to serve all residents. "We know what CMS [the Centers for Medicare and Medicaid] is trying to do, so we’re happy about it because there is such a workforce shortage. But it is really hard right now to see what states are going to do."

What wouldn’t be helpful, according to Elehwany, is for states to simply set high time and distance maximums -- like three hours and 100 miles. That won’t ensure or improve access to care and will just be another regulation for states to follow, she said.

Matt Salo, executive director of the National Association of Medicaid Directors, said the new regulations have been well-received from officials he's talked to, but "it's going to take a lot of energy and resources to come into compliance, and health officials need to start thinking: How do you roll this out in a way that makes sense? What’s the right way -- not easiest -- to measure access to care?”

As officials digest all 1,400 pages of the new rules, Elehwany hopes the federal government will back the new regulations with funding for programs.

“There are a great community-based services that could be launched or ramped up that could reduce health disparities," she said. "Rural areas have a tremendous need not only for care but for community health workers who understand the culture. Those are the people best positioned to encourage these populations to stay healthy."

Many states have already made attempts to address the doctor shortage in rural areas. Alaska, for example, works with the state university to disperse mental health providers in the most far-flung areas; more than half the states encourage the use of telemedicine; Missouri lets medical school graduates practice in rural areas without completing a residency; and roughly a dozen states have formed a pact that makes it easier for doctors to practice in multiple states.

Despite all of these attempts, the drought of medical help remains for much of rural America.