FARMINGTON – Franklin Memorial Hospital is one of four rural-based hospitals in Maine chosen to receive an increase in the amount Medicare reimburses for the care they provide as part of the federal Rural Community Hospital Demonstration Program run by the Centers for Medicare and Medicaid Services.
Maine’s Congressional Delegation made the announcement late yesterday that Farmington’s hospital, along with Miles Memorial Hospital in Damariscotta, Maine Coast Memorial Hospital in Ellsworth and Inland Hospital in Waterville are eligible to participate in the program that begins increasing Medicare reimbursements on July 1. A total of 19 hospitals were selected to participate in the demonstration in Colorado, Iowa, Kansas, Maine, Mississippi, and New Mexico.
In making the announcement, Maine U.S. Rep. Mike Michaud said the program “will provide crucial funding to our small hospitals that are struggling under the current Medicare reimbursement formula.” Besides the additional funding, the program’s ultimate aim is provide an impetus toward finding ways to improve clinical outcomes with cost efficiency through initiatives each hospital participating in the demonstration has proposed.
Franklin Memorial Hospital is welcoming the increase in Medicare reimbursement and the prospect of creating new strategies for healthcare reform, said Rebecca Ryder, FMH president/CEO.
“Under the current system of reimbursement, by taking care of Medicare patients you lose money. It’s not reimbursing enough to cover the cost of care,” Ryder said. Qualifying for the demonstration program is estimated to bring in hundreds of thousands of dollars more each year to the Farmington hospital over the next five years of the program.
“This is huge,” Ryder said today. She credited Maine’s Congressional Delegation for relentlessly advocating over the last several years for the state to be able to participate in the program. The Rural Community Hospital Demonstration Program was originally authorized in 2003 in response to the financial concerns of small, rural hospitals that are too large to qualify as Critical Access Hospitals. (Hospitals designated as critical access hospitals, such as Skowhegan’s Redington-Fairview General Hospital and Rumford Hospital, qualify because they have fewer than 25 inpatient beds and receive Medicare reimbursement equal to cost of care.) Ten states with the lowest population density were originally selected to participate in the program. At the time, Maine was not eligible to participate. The Affordable Care Act reauthorized the program in March 2010 for an additional five years, allowing the 20 most rural states to participate, including Maine this time.
FMH submitted the program’s complex application in mid October and received the good news yesterday.
In qualifying for the program’s increased Medicare reimbursement, hospitals are expected to use additional funding toward creating strategies to decrease the cost of healthcare while improving the quality of care. Studying the demographics of Franklin County, FMH decided to focus its program initiative towards the issue of providing healthcare to a growing senior population.
“The elderly population tends to have more health issues and are hospitalized more frequently,” she said. Better access to a primary care physician, particularly in a rural area for chronic health issues such as diabetes and heart disease, instead of the more expensive trip to the hospital’s emergency room, is a major focus of FMH’s initiative.
Ryder said the Franklin Community Health Network that includes primary care physicians under its umbrella of healthcare services is sufficient now, Ryder said. But, in the coming years, as more and more people age, recommended primary care won’t be able to keep up with the increased demand and will need to expand. The planning process towards deciding what the healthcare needs of Franklin County will be in the years to come is part of the project’s process. Ryder said it will be especially helpful to be sharing ideas with how to solve these questions with Maine and other states’ hospitals.
“What are the other good ideas out there?” Ryder asked, adding that five years from now when the program ends, she expects to see a whole different strategy for providing healthcare in rural areas like Franklin County. The program will provide “a bridge strategy,” she said, to move from today’s system of taking care of sick people towards keeping people be as well as possible for as long as possible through primary care physicians. “Hospitalization should be the last resort,” she said.
According to CMS, the demonstration is designed to test the feasibility and advisability of reasonable cost reimbursement for inpatient services to small rural hospitals. The demonstration is aimed at increasing the capability of the selected rural hospitals to meet the needs of their service areas.
“We are very excited to be a part of this very important program, ” Ryder said.
Thanks to all the hard work put in by FMH’s administrative team in order to make this happen! We are very lucky to have such dedicated administrators guiding our hospital through these challenging times in healthcare.
Congratulations to Franklin Memorial Hospital staff and community board members for continuing to excel at providing high quality health care services in rural Maine.