Obamacare Expansion A Bumpy Ride For Rural Health Clinics

Reprinted with permission from Kaiser Health News, a national health policy news service that is part of the nonpartisan Henry J. Kaiser Family Foundation.

A network of clinics that serves low-income patients in rural Northern California is finally finding balance after being deluged with newly insured patients under the Affordable Care Act.

After a more than two-year moratorium on nearly all new adult patients, the Redding-based Shasta Community Health Center has reopened its doors to some newcomers this month, and it will start accepting more new patients in September.

When Medi-Cal, California’s version of Medicaid, was first expanded under the Affordable Care Act in early 2014, the number of people insured under the program doubled to around 40,000 people in the region served by Shasta Community Health. Not only did the clinics see new patients, but the demand for services soared from existing ones who were newly insured.

The clinic network already had a shortage of doctors and nurses. — a problem shared by many other rural health clinics in California.

“The … more new patients we brought in, the more stress on the providers, the more likely [they] were going to leave, the deeper the crisis went,” said Shasta Community Health Center CEO C. Dean Germano. So he decided to close the network’s five clinics to new adult Medi-Cal patients, though they continued to serve all of their existing patients and accepted new children.

During the moratorium, patients in the region had to travel long distances for primary care, or use the local emergency room, Germano said.

Shasta Community Health Center has since boosted its capacity to provide primary care. It has hired two physicians, created a family practice residency program and has a fellowship program for nurse practitioners and physician assistants. For every new primary care provider, the clinic network can add up to 1,200 new patients, Germano said. The system now serves about 60,000 people in the area.

California Healthline interviewed Germano about his health center’s experience adjusting to the changes wrought by the Affordable Care Act. His comments have been edited for length and clarity.

Q: How did the ACA change the type of services you were giving or the type of care the patients needed?

Uninsured people tend to use the system much less and often at the worst possible places.

With the onset of coverage, you have all this relief to pent-up demand, people seeking more regular care and preventive [care], which often for the uninsured is not a priority. They tend to come in because they have acute issues or they have long-term chronic issues that have become complicated.

So [with] people gaining coverage, the uninsured are becoming much like our other insured populations — seeking care at the appropriate moments.

Q: Were you able to meet the demand for all these new services?

No, not at all. We quickly became overwhelmed, although there were a couple of things happening all at once. One was certainly the growth in Medicaid coverage, but at the very same time, the state of California expanded Medi-Cal managed care into 28 rural counties. We are one of them. We did not have Medi-Cal managed care prior to this.

We were assigned patients, then assigned more patients. We quickly reached a point where we could not take on more new adult patients to our practice. We had to essentially constrain and at one point close the practice to new adult Medicaid patients. We never closed the practice to uninsured patients because they don’t have many options, as in the ER. We never close it to homeless or to children or to people with HIV. Interestingly enough, [it was] not a great business model because our best payers are the ones we closed to.

It was a very big hit [to] the community because adult patients had to go further afield to find services outside of the emergency room. Under managed care, it’s [the health plan’s] responsibility to find a medical home and some of the medical homes were 30 to 40 miles into the mountains. For patients who have transportation issues, there was no doubt that was a real imposition.

Q: Can you describe the region’s shortage of providers?

We are close to 20 primary care physicians short in our community, including our insured and Medicare populations. In a rural community, that’s a big number. So the deficit has always been there.

It’s always been tough for rural areas to recruit [physicians], but in this environment where everyone is struggling to hire, it really made the challenge that much more difficult. Medical students don’t go into primary care for lots of reasons. One of them is debt load. Most of the doctors I hire now usually have an average of $300,000 worth of student debt.

In addition, there are not enough family medicine residencies in California. We need a lot more primary care residencies, particularly in family medicine.

Q: Do you think an increase in the rates Medi-Cal pays to providers is what’s needed to ensure that all areas have the coverage they need?

The gap is so huge now between Medi-Cal and Medicare reimbursement. A five or ten percent adjustment would help the margins, but isn’t going to create a wholesale shift of providers into Medi-Cal, because we’re seeing in rural areas the provider shortage exists for patients covered by Medicare and private insurance.

Where we feel [the low reimbursements] the most is on the specialty care side. It’s very difficult to get referrals in a timely way when the reimbursement is so pitifully poor. And we really lean on our specialty community.

When a specialist looks at a rural community, it’s really hard for them to … say “I’m only going to take the insured patients,” because typically there aren’t enough insured patients to create a full practice. So they look at the full book of business. They look at what the insured population looks like, what the Medicare population looks like and then everybody else, particularly Medicaid. And in many specialties, particularly in pediatrics and the surgeries, you look at what percentage of your practice is going to be [covered by] Medicaid. In California, if that number is really high, it’s often not viable for them to move into that rural community because that book of business doesn’t make sense for them.

So, Medicaid being such a low payer has a huge ripple effect. And where that’s important in rural communities is that if we don’t have an EMT surgeon or a general surgeon or urologist because they can’t put together a decent book of business, it’s not just the poor people who suffer. It’s the whole community.

Q: If increasing the Medi-Cal rates isn’t necessarily the silver bullet, how would you remedy the overall problem of provider shortages in certain areas?

First of all, the reimbursement rate has to be better.

Secondly, we have not been good at developing training programs, particularly in the primary care specialties but across the board.

I wish there [were] money for post-graduate residency programs for [nurse practitioners and physician assistants] because if we don’t have enough family doctors, general internists and pediatricians, then we’re going to lean on our PAs and NPs.

Q: Would expanding the scope of what nurse practitioners can do help bring providers where they’re needed?

Well, I have mixed feelings about that. If it’s done in the context of a post-graduate residency program, I think that independence makes sense because they should’ve gotten a lot of what they needed to know. [But] just putting a new practitioner with an independent license out there and letting him hang his shingle out, I have mixed feelings about.

But I do think that if you can marry a post-graduate training program and a pathway for independence, that might work or maybe a certain number of years of practice under a physician’s supervision.

This story was produced by Kaiser Health News, which publishes California Healthline, a service of the California Health Care Foundation.