“Code Blue”: Medicare reimbursement reform needed to save the life of rural hospitals.

The healthcare industry has undergone drastic reforms over the last few years. It has been strained by inflating costs and pressed with questions about the Affordable Care Act’s implementation and future. Few hospitals and patients are immune from these stressors. Rural hospitals have been impacted especially hard. The hardships that rural hospitals face are largely a byproduct of the special Medicare rules for rural hospitals. These rules substantially differ from that of urban and suburban hospitals. 


Rural areas typically have hospitals that are categorized as “critical access” hospitals. Critical access hospitals are much smaller than their urban counterparts. These hospitals can have no more than 25 inpatient beds, they must maintain an annual average length of stay of no more than 96 hours, and they have to be a minimum 35 miles from the next nearest hospital.


Certification as a critical access hospital allows that hospital to receive cost-based reimbursement from Medicare, as opposed to the flat rate reimbursement that non-critical access hospitals typically receive. Medicare requires that a patient pay 20 percent of the amount that the critical access hospital charges. Patients also pay 20 percent coinsurance at non-critical access hospitals, however that 20 percent is based on the amount Medicare reimburses, which is typically significantly lower than what the hospital charges.


This reimbursement structure stresses both the critical access hospital and the rural Medicare patient. For example, in 2012, when a Medicare patient received an electrocardiogram at a rural critical access hospital, they owed an average of $33 for that procedure. Patients at other, more urban hospitals would only have had to pay about $5. According to a recent report by the inspector general at the Department of Health and Human Services, many Medicare beneficiaries who received treatment at these rural critical access hospitals have ended up paying between two to six times more for services than patients non-critical access hospitals.


When interviewed on this topic, Eric Draime, chief financial officer for Avita Health Systems, stated that this difference is not the rural hospitals' fault. "Critical access hospitals don't charge more. They charge less, but the way Medicare developed the system, the enrollee ends up footing more of the bill," CFO Draime said.


To make matters worse, the rural population is not only paying more, but their hospitals are closing due to this payment structure. USA Today recently reported on these closures, stating: “[l]ow Medicare and Medicaid reimbursements hurt these hospitals more than others because it's how most of their patients are insured, if they are at all.”

Thus, the costs that the rural population is currently facing is not only financial, but the cost in the length of time that it takes to get to the next nearest hospital post critical access hospital closure. In another USA Today report, this issue was shockingly addressed in the case of a man who had a stroke and, because of the closure of his local critical access hospital, had to be ambulanced for nearly 40 minutes to the county’s urban hospital. 

The inspector general’s office has advised that Congress change the law so that a Medicare beneficiary’s financial responsibility better reflects the cost of the service. Brock Slabach, a senior vice president at the National Rural Health Association, said that “[t]he reason this hasn’t been solved is it would require the Medicare program to subsidize more. . . .” 

In addition to reconfiguring the reimbursement aspect of Medicare, Congress should mandate that the 23 states that refuse to participate in the Medicaid expansion do so. Without reform, more hospitals will close, cost will continue to rise, and rural Americans will bear the burden of the very program intended to help them.

Veterans drawn to "the sticks"

The San Francisco Chronicle today ran a Veterans Day feature about the attraction of rural places to veterans, with a focus on Esmeralda County, Nevada, population 832.  Esmeralda County is said to have the second highest per capita concentration of veterans among all U.S. counties, beaten out only by Fall River County, South Dakota (population 6,839).  Nationally, 36 percent of veterans live in rural areas, whereas just 24 percent resided in rural places 14 years ago.  In sharp contrast, just 4.5 % of San Francisco residents are veterans.  

Reporter Kevin Fagan speculates on the reasons for the attraction, and he also discusses and benefits of rural living for vets.  Regarding the former, there is little doubt that "part of the allure is affordability."

Veterans in rural areas are older on average, and Social Security and military pensions go a lot further in a place like Esmeralda County, where homes can be had for a few thousand dollars and entertainment is more oriented toward roaming the countryside than dining at foodie meccas. 

But veterans and federal officials say that as much as anything, the attraction of sparsely populated areas is their independent, uncluttered nature.

Fagan depicts Esmeralda County as relatively lawless--or at least light on regulation--writing that vets  

come to escape the big-city hum, to live life in wide-open, high-desert country where they can do whatever they want, whenever they want, and pretty much however they want.

He notes, for example, the lack of a residential building code.

Fagan quotes Tom Klobucar, deputy director of the U.S. Veterans Affairs Office of Rural Health.  

If you’ve been in the military, you already have discipline and self-reliance.  You need that in a rural area, and a since a lot of vets feel a need to get away from the hustle-bustle, that’s where they end up.

Klobucar also opines on the burden of distance for the nation's many rural vets.  Those in Esmeralda County, for example, mostly have to drive the 180 miles to Las Vegas for VA health services.  

Fagan also features and quotes several Esmeralda County vets, including Dave Beth, 66, who moved there seven years ago after 42 years of Navy aviation duty and military civilian work in Phoenix:

In this kind of land, you just get this calm peacefulness you don’t find much of anywhere else. 

Liking this is a hard thing to describe to most folks. But, funny enough, not to veterans. We get it. It’s our kind of place.

Oh, and as for the headline on this post, I draw it from a line of Fagan's story, referring to rural places as "the sticks."  Which I guess is fair enough given that one of the other veterans Fagan features has "hillbilly" tattooed on his cheek because, he says, it reminds me who he is when he looks in the mirror.    

Native Americans: where does their story fit in the American narrative?

I think it is fitting, considering that Thanksgiving is right around the corner, that I write a post concerning Native Americans. I am sure we are all acquainted with the somber truth of past genocide and conquest. We are well aware of how this Nation, in particular its vast rural terrain, was fashioned through broken promises, massacres, and plunder. But, many Americans often forget that the few Native Americans that remain face tremendous social and economic difficulties.

Among the inestimable sufferings endured by Native Americans is that of sex crime. The Justice Department reports that one in three Native American women is raped over her lifetime. Often these women are too frightened to report rape. Moreover, even if a Native American woman were to report rape, she would have little to no recourse in tribal and federal courts. This is because non-Indian men, who are immune from prosecution in tribal courts, commit 80 percent of sex crimes on reservations. And, federal prosecutors choose not to prosecute around 70 percent of sexual abuse cases.

Because of this legal vacuum, according to the Minnesota Indian Women’s Resource Center, non-Indian habitual sexual predators have flocked to tribal areas.

Many often presume that the darkest period in Native American history extended only up to the late nineteenth century. However, governmental persecution of Native Americans remained throughout the twentieth century although it took on a different form.

The federal government established Native American boarding schools in the late nineteenth century in order to “kill the Indian in the person, and save the person.” In effect, the schools were set up to completely destroy what was left of Native American culture. In its stead, the schools sought to cultivate a culture of subservience and docility.

The children were forcefully taken from their parents, made to cut their hair, given new English names, and violently compelled to speak only English. They were not taught math or grammar, but rather they were taught trades: boys learned carpentry and girls learned housekeeping.

This sort of pedagogy remained up until the 1970s. A 1960s congressional report on Native American boarding schools documented that teachers viewed their role as “civilizing” Native American children, not educating them.

It truly is stupefying, when you clear your mind and think: this nation was built upon the graves of massacred Native Americans. Millions of people, children and the elderly, were murdered by our ostensibly sacrosanct armed forces so that American industry could have a foothold in the vast expanses of untamed wilderness that was once this nation. It is extremely important to note that much of this extermination occurred at the hands of the U.S. military although Hollywood has often portrayed Native American massacre as the result of skirmishes between cowboys and Indians.

Of course, mercenaries and vigilante frontiersmen participated enthusiastically in Native American execution. However, we do a disservice to truth, if we do not realize that the U.S. government was in fact the engineer and the principle actor behind this genocide. Mercenaries and vigilante frontiersman were secondary agents incorporated within a broader schema.

The government, acting as an organ of industry, of Wall Street, as it always does, cleared the way so that railroads could be constructed, mines could be built, and vast farms could be formed. What is more, thousands of miles of picturesque plains and forest were degenerated for the sake of big business.

Adding insult to injury, all this that was truly done for the sake of profit was advertised as an expansion of democracy. And now, most Americans view this atrocity as simply a deviation in American history, as a stain upon the proverbial fabric, when in actuality this atrocity makes up the very fabric of this nation’s history and economic “success.”

The smooth, nonchalant logic and calculation of this nation’s profiteers is astounding. Ask a simple question. Why were Native Americans not simply incorporated into the economic system of this nation? Why were they not enslaved, like the Native Americans south of the border? Because it is next to impossible to enslave an egalitarian people who are entirely unacquainted with systems of hierarchy and subservience. Native Americans south of the border, particularly the Aztecs and the Incas, had already reached the historical epoch defined by class and a state. Thus, the Spanish easily incorporated and manipulated the hierarchical divisions within Aztec and Inca society. They enslaved the peasants and bought off the aristocrats.

Native Americans in this country were recalcitrant and literally physically in the way of expansion. So, not being able to exploit them, American industrialists found a simple solution: kill them. Drive them into smaller and smaller pockets of land, starve them, and massacre them. In their place, they imported masses of stolen Africans. That is why African slavery was almost nonexistent in Mexico, but ubiquitous in the U.S. West Africans, much like the Aztecs and Incas, were easy to enslave because they were part of a complex class society. That is why we hear stories of West African slave traders.

This was a centuries long process, a process that has extended, as I discussed above, to today although we may not like to see it. The few Native Americans that are still alive are compelled to endure staggering poverty and the tribulations inextricably attached to it. To argue that this is simply an ethical digression in American history would be an offense to anyone with even just a modicum of intelligence.

Crime and law enforcement in rural Alaska's native communities

After watching "Incident at Oglala" -- the documentary showcasing the tensions and events surrounding the 1975 shootout between a group of Native Americans and two FBI agents on the Pine Ridge Reservation -- I became interested in the unique challenges faced by Native American rural communities with regard to law enforcement. I stumbled upon several articles discussing the lack of a strong law enforcement presence in rural areas of Alaska. Rural Alaska has the worst crime statistics in the United States. Native American communities in rural Alaska experience the highest rates of domestic violence. Moreover, Alaska is the rape capital of the country, with rape occurring at three times the national average.

Alaska's high crime statistics are exacerbated by spatiality. 229 of the country's 566 recognized tribes are located in Alaska, most of them in Alaska's "Bush" regions -- the areas of Alaska not connected to the road or ferry systems. Most of the areas in the Bush that are not accessible by roads can be reached only by a small airplane, while locals typically travel by snowmobile, dogsled, and boat.

Associate Attorney General Tony West recently stated that "there are places in rural Alaska that if a woman is raped or a child is beaten, that victim might not get any help whatsoever...it can take a day and a half before responders show up to the scene of a crime or to a call for help." Because they have no police and few courts of their own, Alaskan natives in the Bush regions largely rely on state troopers, who are few and far between. Moreover, a spokeswoman for the Alaska State Troopers stated that the terrain and distance between troopers and rural areas delay responses to crime reports. As a result, locals are often forced to take matters into their own hands before law enforcement officials arrive to a crime scene. For example, when a 13-year-old native Tlingit girl named Mackenzie Howard was beaten to death in rural Kake last February, a villager gathered other locals to guard Howard's body and the crime scene before troopers from arrived from Juneau, 114 miles away. In other towns, locals have been forced to lock suspects in closets or handcuff them until law enforcement officials arrive.

Moreover, the lack of a strong law enforcement presence in rural areas of Alaska perpetuates crime. Perpetrators are less likely to fear the consequences of their crimes and are more likely to get away with them. As Mackenzie Howard's mother stated, "[p]eople don't really fear the law here." Some native Alaskans believe that the remoteness of law enforcement from rural areas also attracts criminals.  

Something that stood out to me while reading the articles on crime in rural Alaska was what appears to be a strong feeling of resentment on the part of native Alaskans to the delayed response of law enforcement officials (or, in some cases, their lack of response). Multiple native Alaskans have expressed a common sentiment among communities in the Bush regions -- that they only feel the full force of law enforcement when somebody commits a hunting or fishing violation. As one villager stated, "[t]he fastest way to get law enforcement here is to shoot a moose." 

This resentment toward and distrust of law enforcement in native Alaskan communities reminds me of the tensions surrounding the incident on the Pine Ridge Reservation. Here, as there, the native communities have been forced rely on themselves for maintaining some sense of order, as seen with the creation of ad hoc law enforcement teams to guard crime scenes and evidence. Moreover, as on the Pine Ridge Reservation, many residents of rural Alaskan communities feel the need for self-protection with the lack of nearby police and troopers. For example, in the wake of the Howard murder, several residents of Kake began carrying guns with them. Furthermore, as with the Pine Ridge Reservation in the 1970s, the violence and crime in rural Alaska is not eliciting a sufficient response from law enforcement or the government at large. After all, what brought Pine Ridge Reservation to the attention of many Americans was the fact that two outsiders, FBI agents, were killed in the midst of a shootout -- not the fact that Pine Ridge had the highest rates of violent crime in the United States at the time. Will the violent crime in rural Alaska similarly go largely unnoticed and unaddressed? Are conditions in the Bush regions ripe for another Pine Ridge incident?

For more information on challenges faced by rural Alaskans with regard to spatial isolation and self-reliance, click here (discussing the difficulty of delivering medical services to rural Alaskans).

Orange County: Farmland for centuries, suburb in a generation

What is the first thing that comes to mind when you think of Orange County, California? Miles and miles of beaches, large houses, and nice cars? That’s the impression that I had when I first moved to Orange County. But just a couple generations ago, Orange County was a very rural county. What’s interesting is how quickly Orange County developed from rural farmland to a major Southern California suburb.

For the vast majority of Orange County’s civilized history, the primary economy was agriculture. The Native Americans who lived in the area hunted, fished, and planted seeds. In 1769, the first Spanish explorers arrived in present-day Orange County (which was then part of Los Angeles County), and by 1776, the Spanish missionaries established Mission San Juan Capistrano. Those who occupied the mission grazed cattle, horses, and sheep.

While California was under Mexico’s rule, settlers began pouring into the county, and received grazing rights for the settled land. By 1846, almost the entire county was divided into ranches. By the time California was admitted into the union in 1850, Orange County had a population of 500.

Those who held title to the original Mexican land grants began dividing up their properties and sold parcels to settlers. Even though towns like Santa Ana, Orange, and Westminster were born, the economy remained largely agriculture-based. The local economy rested in part on wine grapes, corn, wheat, and barley. The growth of this agricultural economy fueled a sense of identity, which helped residents secede from Los Angeles County, and formally establish Orange County in 1889.  

For the next half-century, agriculture “remained the most important part of Orange County’s economy.” New crops, such as celery, walnuts, and beans, were planted and harvested at the turn of the century. By World War I, Orange County had 20,000 acres of orange groves, and by the Great Depression, Orange County produced one-sixth of America’s Valencia oranges.  

Then came the 1950s.

The 1950s ushered in an era that changed Orange County forever. This was the decade of expanding freeways, bulldozing farms, and building suburban homes. When Walt Disney built his park in the mid-1950s, he had to clear 160 acres of orange groves and walnut trees in Anaheim. Between 1950 and 1960, the population of the county increased by more than 300%. By 1963, the population surpassed one million.  

In 2004, there were fewer than 100 acres of citrus groves. Presently, with a population of more than three million, Orange County is the third most populous county in California, behind Los Angeles and San Diego counties, and the sixth most populous county in the United States.  

How did this transformation from farm to suburb take place so quickly? There were many factors that, taken as a whole, facilitated this change. The 1950s saw the birth of the Eisenhower Interstate System and a proliferation of personal automobiles. This liberated homeowners from living near the city centers to purchase homes in newer and nicer neighborhoods in the suburbs. Orange County was in a prime location; in addition to its beautiful weather, Orange County had abundant space and was conveniently juxtaposed beside America’s second largest city.  

But Orange County is not an ordinary suburb or bedroom community. Orange County as a whole might seem like one big city, but it doesn’t resemble a traditional concentric-zone city in which a single downtown is in the middle, encircled by “rings” of residential areas. In Orange County, there is no single downtown; rather, there are multiple “central business districts” throughout the county in Santa Ana, Costa Mesa, and Irvine (all of which have populations less than 350,000). The traditional suburb-to-urban commute generally doesn’t apply to Orange County. Most residents live and work within the county, prompting a suburb-to-suburb commute, primarily by automobile.

But if you want farm-fresh fruits and vegetables long associated with Orange County, you won't have to drive far.  There are many farmers' markets throughout the county, in the suburban cities that replaced the very farms that existed half a century ago. 

California passes new law aimed to reduce sexual harassment of field workers

Last year a number of media outlets featured stories about the sexual harassment of field workers. NPR did two stories found here and here. These two stories were covered on the blog here. Frontline also covered this same story here. The stories are similar and tragic. The women were all sexually assaulted, but out of fear of reprisals did not immediately report the crimes. After her assault, one woman continued to work the fields until she could not take it anymore. She reported the incident and was fired immediately. She was threatened with calls to the Immigration and Naturalization Service (INS) if she pursued legal action against her attacker. This year the California Legislature passed a law aimed at protecting field workers from sexual harassment by going after the labor contractors who employ them.

On September 28, 2014, California Governor Edmund Brown, Jr. signed into law Senate Bill (hereafter, “S.B.”) 1087. S.B. 1087 was introduced by Senator Monning (D-Carmel) and goes into effect on January 1, 2015. The Bill will punish labor contractors who hire workers with a history of sexual harassment by revoking or suspending their licenses. Further, the bill mandates sexual harassment training for both supervisors and employees.

Senator Monning was inspired to write the bill after hearing the reports by Univision, UC Berkeley’s Investigative Reporting Program, Frontline, and the Center for Investigative Reporting. The reports exposed how rampant the problem of sexual harassment was and how little was being done about it. Senator Monning said this bill “is the first step to help protect these workers from unwanted sexual advances and sexual violence.”

As the NPR and Frontline pieces point out, the victims are in an extremely vulnerable position. They work in isolated locations where the harassment can go unnoticed. They are in desperate need of their jobs. The perpetrators of the harassment are often supervisors who control whether these women will keep their jobs. The women fear they will lose their jobs if they report any incidents. These fears are grounded in reality. The women from the NPR and Frontline stories did lose their jobs when they reported the incidents. All it takes is one phone call and their entire livelihood could be taken away. This leads to a feeling of helplessness for the women and invincibility for the perpetrators and the supervisors who look past it.

While S.B. 1087 was making its way through the legislature, Michael Marsh from California Rural Legal Assistance commented that:

a lot of the harassers are serial harassers. They go from one place of employment to the next place of employment and no one ever checks on their credentials or checks their background.

This new law will prevent labor contractors from hiring anyone who has been found by a court or administrative agency to have committed sexual harassment upon another employee. 

S.B. 1087 passed through the California Legislature with some resistance. Six Senators – all Republican – voted no. Twenty-three Assemblymembers voted no, again all Republican. I am not surprised by the ideological split in the votes, but I am surprised by the amount of opposition. And most surprising of all was the number of female no votes:  Among the ‘No’ votes were seven female Assemblymembers and one female senator.

Where do falling gas prices leave the hydraulic fracturing industry?

Although filling up your tank for less than $20 is not in the foreseeable future, gas prices have been falling in a dramatic fashion this fall. Gas prices are at their lowest in early 4 years, under $3.00 a gallon in much of California and under $3 across most of the United States Crude oil was selling for just above $80 a barrel at the close of market this past Thursday. This is the lowest that oil prices have been since December 2012 and is down from a year high of about $100. Worse news for oil producers is that the price is projected to stay around this level for the remainder of 2014.

The decrease in the domestic gas price is likely attributable to several factors, the most important being the implementation of alternative energy and shale oil resources in the United States and Canada.

Shale oil is derived from the ground by a process known as hydraulic fracking, or simply ‘fracking’. Fracking entails forcing a mixture of chemicals, sand and water into the ground to force apart shale rocks and release gas. U.S. drilling companies have become so adept at fracking that the United States is forecasted to be energy independent as early as 2020.

Key natural gas sources for fracking are situated beneath rural and historically poorer areas, like the Marcellus-Utica shale formation, which spans parts New York, Pennsylvania, Ohio and West Virginia. The fracking explosion has transformed many of these rural communities. Some living in fracking territory have benefited from jobs or the sale of mineral leases and drilling rights. However, the recent drop in oil price may compromise these benefits. 

According to a recent report by Goldman Sachs Group Inc., a price of $80 a barrel would cause many hydraulic-fracturing projects to become uneconomical due to costs associated with fracking. The Wall Street Journal writes: “[w]hile fracking costs run the gamut, producers often break even around $80 to $85.”

The price will likely continue to fall this November. At OPEC’s upcoming November meeting, it is anticipated that OPEC will not reduce their output to adjust for the decline in price.

Perhaps this forecasting sheds light on the rationale behind Chesapeake Energy Corporation's recent sale of their Utica and Marcellus shale positions. The company said earlier this month that it was set to sell these shale assets to rival Southwestern Energy Co. for more than $5 billion.

So where does this leave rural America?

While the future of fracking cost effectiveness is in question, the future of rural America is not. Even if fracking positions are liquidated, the negative environmental and social impacts associated with fracking will likely persist. Further, the negative associated with the short-term economic gains will begin to surface.

These negative economic costs are assessed by Mark Partridge, the C. William Swank Chair of Rural-Urban Policy at Ohio State University and a professor in the Agricultural, Environment, and Development Economics Department. He writes:

Many impact studies also fail to account for possible offsetting negative effects from energy development that may offset the positive effects such as any crowding out of other economic activity that would have occurred otherwise (e.g., entrepreneurs outside of energy may try other locations with more stable labor markets). Higher prices (especially for housing) may also offset some of the benefits of higher wages potentially negatively affecting quality of life in the area. In addition, many of the benefits may trickle away to other areas due to commuting workers, purchases outside the region, and absentee landowners receiving the lease payments. Finally, perceived or real environmental degradation may frighten some current residents and potential residents away— especially in the long-run. The take-away is that communities should be wary of industry funded economic impact studies (regardless of the industry) and should try to verify economic impact estimates with independent experts.

He concludes:

[t]he general lesson is that short-term energy booms do not necessarily translate into long-term economic prosperity.

In short, rural America may actual be in a worse position now --both economically and environmentally--than prior to the early '90s shale ventures.

Are rural and urban counties moving toward partisan extremes?

A recent study done by the Washington Post labeled counties based on how urban versus rural they are. The study did so in order to track partisanship of voting trends over time. By comparing each county’s votes to the national average in subsequent elections, the authors were able to determine how voting trends in different types of counties – urban versus rural – had changed since 1988.

In short, between 1988 and the 2012 election, heavily urban counties became more Democrat by 32 percent; heavily rural counties became more Republican by 11 percent. This shift happened incrementally with each election year. The study also points out that far more counties are considered heavily rural, but fewer over all rural votes, explaining why the national average in all counties in presidential elections has become more Republican. The article concludes by stating:

If you plot every county's urban-versus-rural divide by the per-election average change in the vote, the pattern is clear: more urban areas vote have been voting more Democratic. 

And vice versa. These findings come to life in a recent op-ed in the New York Times. The author, Silas House, describes the idyllic, rural, coal town of Berea, Kentucky where he grew up. The City Council of the ethnically diverse town founded by abolitionists recently voted against a city ordinance to ban discrimination based on sexual orientation or gender identity.

The author compares this to larger, more progressive cities, such as Louisville. Once you step outside larger cities, which have passed their own antidiscrimination ordinances, it is perfectly legal to refuse service, employment, and housing to LGBT individuals. While in many places protections vary from place to place, House views this as indicative of where the struggle for equality lays – a struggle not between political parties, but urban and rural localities. Regarding the city vote to strike down the ordinance in Berea, House states:

“The vote illuminates a new reality for gay, lesbian, bisexual and transgender Americans. The equality divide we face is no longer between red and blue states, but between urban and rural America. Even as we celebrate victories like this month’s Supreme Court order on same-sex marriage, the real front in the battle for equality remains the small towns that dot America’s landscape.”

Both the conclusions of the New York Times and Washington Post seem to reinforce each other if you buy into the conclusion that “rural” and “red” have become so inextricably linked that there is no way to differentiate one from the other. At least that’s what these two pieces suggest. If the trend described in the Washington Post continues – that rural counties are becoming more Republican – the battle for LGBT equality in small towns may become even more arduous.