Current:Home > FinanceMedicare Advantage keeps growing. Tiny, rural hospitals say that's a huge problem -ProfitSphere Academy
Medicare Advantage keeps growing. Tiny, rural hospitals say that's a huge problem
View
Date:2025-04-12 15:16:33
Jason Bleak runs Battle Mountain General Hospital, a small facility in a remote Nevada gold-mining town that he describes as "out here in the middle of nowhere."
When several representatives from private health insurance companies called on him a few years ago to offer Medicare Advantage plan contracts so their enrollees could use his hospital, Bleak sent them away.
"Come back to the table with a better offer," the chief executive recalls telling them. The representatives haven't returned.
Battle Mountain is in north-central Nevada, about a three-hour drive from Reno and four hours from Salt Lake City. Bleak (whose name is pronounced "Blake") suspects insurance companies simply haven't enrolled enough of the area's seniors to need his hospital in their network.
Medicare Advantage insurers are private companies that contract with the federal government to provide Medicare benefits to seniors in place of traditional Medicare. The plans have become dubious payers for many large and small hospitals, which report that the insurers are often slow to pay or don't pay.
Private plans now cover more than half of those eligible for Medicare. And while enrollment is highest in metropolitan areas, it has increased fourfold in rural areas since 2010. Meanwhile, more than 150 rural hospitals have closed 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 have had the most closures.
Medicare Advantage growth has had an outsize impact on the finances of small, rural hospitals that Medicare has designated as "critical access." Under the designation, government-administered Medicare pays extra to those hospitals to compensate for low patient volumes. Medicare Advantage plans, on the other hand, offer negotiated rates that hospital operators say often don't match those of traditional Medicare.
"It's happening across the country," says Carrie Cochran-McClain, chief policy officer of the National Rural Health Association, whose members include small-town hospitals.
"Depending on the level of Medicare Advantage penetration in individual communities, some facilities are seeing a significant portion of their traditional Medicare patient or beneficiary move into Medicare Advantage," Cochran-McClain says.
Kelly Adams is the CEO of Mesa View Regional Hospital, another rural hospital in Nevada. He says he applauds Battle Mountain's Bleak for keeping Medicare Advantage plans out of his hospital "as long as he has."
Mesa View, which is a little more than an hour's drive east of Las Vegas, has a high percentage of patients enrolled in Medicare Advantage plans.
"Am I going to say I'm not going to take care of 40% of our patients at the hospital or the clinic?" Adams says, adding that it would be a "tough deal" to be forced to reject patients because they didn't have traditional Medicare.
Mesa View has 21 Medicare Advantage contracts with multiple insurance companies. Adams says he has trouble getting the plans to pay for care the hospital has provided. They are either "slow pay or no pay," he said.
In all, the plans owe Mesa View more than $800,000 for care already provided. Mesa View lost about $1.3 million taking care of patients, according to its most recent annual cost report.
Cochran-McClain, of the National Rural Health Association, says the growth in the plans also narrows options for patients because "the contracting that is happening under Medicare Advantage frequently has an influence on steering patients to specific types of providers." If a hospital or provider does not contract with a Medicare Advantage plan, then a patient may have to pay for out-of-network care. That generally wouldn't happen 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 plans.
"Our local nursing homes are not taking Medicare Advantage patients because they don't get paid. But if you're straight Medicare, they'd be happy to take that patient," Adams says. (Medicare pays for limited nursing home stays post-surgery or injury. Long-term care is covered only by Medicaid, for those who qualify.)
David Allen, a spokesperson for AHIP, an industry trade group formerly known as America's Health Insurance Plans, declined to respond to Bleak's and Adams' specific concerns. Instead, he says enrollees are signing on because the plans "are more efficient, more cost-effective, and deliver better value than original Medicare."
Sara Lonardo, press secretary for the Centers for Medicare & Medicaid Services, says CMS has acted to ensure "that private insurance companies are held accountable for providing quality coverage and care."
The reach of private Medicare Advantage plans varies widely in rural areas, says Keith Mueller, director of the Rural Policy Research Institute at the University of Iowa's College of Public Health. If recent trends continue, enrollment could tip to 50% of rural Medicare beneficiaries in about three years — with some regions like the Upper Midwest already higher than 50% and others lower, such as Nevada and the Mountain States, but trending upward.
In June, a bipartisan group of Congress members, led by Sen. Sherrod Brown, D-Ohio, sent a letter urging federal agencies to do more to force Medicare Advantage insurers to pay health systems what they owe for patient care.
In an August response, CMS Administrator Chiquita Brooks-LaSure wrote that a final rule issued in April made "impactful changes" to speed up care and address concerns about prior authorization — when a hospital and patient must get advance permission for care to ensure it will be covered by an insurer. Brooks-LaSure noted another proposed rule that, once finalized, could mandate that insurers provide specific reasons for denying care within seven days.
Hospital operators Adams and Bleak also want more federal action, and fast.
Bleak at Battle Mountain says he knows Medicare Advantage plans will eventually move into his area and he will have to contract with them.
"The question is," Bleak says, "how can we match the reimbursement so that we can sustain and keep our hospitals in these rural areas viable and strong?"
KFF Health News, formerly known as Kaiser Health News (KHN), is a national newsroom that produces in-depth journalism about health issues and is one of the core operating programs at KFF — the independent source for health policy research, polling and journalism.
veryGood! (698)
Related
- Toyota to invest $922 million to build a new paint facility at its Kentucky complex
- May These 20 Secrets About The Hunger Games Be Ever in Your Favor
- Seattle police officer put on leave after newspaper reports alleged off-duty racist comments
- 11 Hidden Sales You Don't Want to Miss: Pottery Barn, Ulta, SKIMS & More
- Warm inflation data keep S&P 500, Dow, Nasdaq under wraps before Fed meeting next week
- Indianapolis police wound 2 robbery suspects after 1 suspect fires at pursuing officers
- Workers exit GM facilities targeted as expanded UAW strikes get underway
- No. 3 Florida State ends Death Valley drought with defeat of No. 23 Clemson
- Nevada attorney general revives 2020 fake electors case
- 11 Hidden Sales You Don't Want to Miss: Pottery Barn, Ulta, SKIMS & More
Ranking
- Man can't find second winning lottery ticket, sues over $394 million jackpot, lawsuit says
- Ice pops cool down monkeys in Brazil at a Rio zoo during a rare winter heat wave
- Train crash in eastern Pakistan injures at least 30. Authorities suspend 4 for negligence
- Why are people on TikTok asking men how often they think about the Roman Empire?
- Tree trimmer dead after getting caught in wood chipper at Florida town hall
- Science paints a new picture of the ancient past, when we mixed and mated with other kinds of humans
- Oregon, coach Dan Lanning put a massive hit on Colorado's hype machine
- UNGA Briefing: There’s one more day to go after a break — but first, here’s what you missed
Recommendation
Senate begins final push to expand Social Security benefits for millions of people
Indiana woman stabs baby niece while attempting to stab dog for eating chicken sandwich
A bombing at a checkpoint in Somalia killed at least 18 people, authorities say
Britain uses UN speech to show that it wants to be a leader on how the world handles AI
Tree trimmer dead after getting caught in wood chipper at Florida town hall
Flamingos in Wisconsin? Tropical birds visit Lake Michigan beach in a first for the northern state
Powerball jackpot winners can collect anonymously in certain states. Here's where
Deion Sanders' pastor and friend walks the higher walk with Coach Prime before every Colorado game