Q&A With … Daniel DeBehnke, Guidehouse

Daniel DeBehnke is a physician and partner at Guidehouse, a Washington-based consultancy firm that recently put out a report that one in four rural hospitals could close, with Kansas being one of the hardest-hit states. And COVID-19 could worsen the situation.

Q: It says in the study that a lot of these hospitals are in trouble because people in rural areas are going to facilities in major metros instead. Why is that?

A: These are rationales for people with complex medical problems, perhaps, to bypass a local rural community hospital and go to a larger metropolitan hospital. We parsed it out by acuity level. Even low-acuity patients are bypassing their local facility. Part of that may be because perhaps they work closer to that other facility. Maybe they crossed a county line, and this was county-line-based. And sometimes there is a lack of understanding in the community about the services that can be provided at the local facility. So, they make an assumption that those services aren’t available there. Or it could be a perception of quality. And I want to make it clear that it’s a perception of quality as opposed to a reality. There may be a consumer perception that the quality could be better in an urban environment.

Q: Is that unfounded? 

A: It depends on the local area and the services that are provided. You could make a global statement that quality is or isn’t equivalent, but you’d have to parse that out by facility and community.

Q: Kansas was a trouble spot that your study pointed out; Is there anything particular about the state that makes its rural hospitals susceptible?

A: I was the CEO of the University of Nebraska Medical Center in Omaha, and Kansas, Nebraska and Iowa are similar in that there are a lot of critical-access hospitals that popped up in every county if you go through those rural states. It just may be the reality that there are too many. And especially now, as we move past the COVID emergency, we need to rethink rural health care and the distribution of services.

Q: This sounds like bad timing with the hit of COVID-19?

A: This is all pre-COVID data. The COVID pandemic is going to be an added strain. The rural health-care patient had existing conditions before they got COVID, just like patients who have cancer or heart disease had something beforehand, and COVID is just an added stress. When you recover from COVID, there is still the underlying problem. That’s the issue with rural health care, as well as changes in demographics and reimbursement. All of those things weakened rural health care prior to COVID. It’s just adding stress to an already stressed system. I think you’ll see significant hospital closures related to the stress that COVID has put on them.

Q: What can rural hospitals do about these issues?

A: One is to improve operational efficiency in those facilities. That’s being really laser-focused on cost control and revenue enhancement, is just basic blocking and tackling. Another solution is state-based payment reform. There have been proposals in a bill called the Reach Act, which would change reimbursement policies for a rural hospital. State and local governments have the opportunity to do those sorts of things as well. And there are some opportunities for consolidation and outsourcing for back-office functionality. Those three areas would probably give them the biggest bang for their buck.