Evaluation of the grant program for rural health care transition : third semi-annual progress report

106 Pages·1991·3.6 MB·English

by  Cheh, Valerie

CMSLibrary
C2-07-13
CMoPntRraRcetfNeor.e:nceNo.: 570807-187-0028-12 Ba7l5t0im0orSee,cuMriDty2B1lv2d4.4
EVALUATIONOFTHEGRANTPROGRAMFOR
RURALHEALTHCARETRANSITION
THIRDSEMI-ANNUALPROGRESSREPORT
March22, 1991
Authors:
ValerieCheh
KatherineCondon
JudithWooldridge
Preparedfor: Preparedby:
HealthCareFinancingAdministration MathematicaPolicyResearch,
6340SecurityBoulevard Inc.
OakMeadoMwsDBuilding,Room2302 P.O.Box2393
Baltimore, 21207 Princeton,N.J. 08543-2393
[phone]
ProjectOfficer: PrincipalInvestigators:
KathleenFarrell JudithWooldridge
LindaBilheimer
CONTENTS
Chapter Page
EXECUTIVESUMMARY
vii
INTRODUCTION
I A. LEGISLATIVEHISTORYANDPURPOSEOFTHE 1
GRANTPROGRAM
B. NUMBERANDCHARACTERISTICSOFGRANTEES 31
1. 1989Grantees 3
2. 1990Grantees 6
II BACKGROUNDON 1989GRANTEES 8
A. MANAGEMENTCHARACTERISTICS 8
B. FINANCIALCONDITION 11
C. STAFFING 14
D. SERVICEAREA 16
E. HOSPITALSERVICES 21
F. POTENTIALFORCONVERSION,CONSOLIDATION,
ANDCLOSURE 23
III PROGRESSOF 1989GRANTEES 26
A. ACHIEVEMENTS 27
1. ProgressRelativetoSchedule 27
2. ProjectsCompletedandTerminated 30
3. OperationalSuccessesandDifficulties 30
B. CHANGESINSCOPE 34
C. EXPENDITURES 35
IV CASESTUDIESOF 1989GRANTEES 41
A. HOSPITALCHARACTERISTICS 42
B. PROJECTOBJECTIVESANDIMPLEMENTATION 45
1. HospitalandProjectManagement:
RoleinGettingStarted 47
2. CommunitySupport 48
C. PROJECTSUCCESSESANDPROBLEMS 50
1. Successes 50
2. Difficulties 52
ii
CONTENTS(continued)
Chapter Page
D. IMPACTSOFTHEGRANTPROGRAMONTHE
HOSPITALANDSURROUNDINGCOMMUNITY 55
1. EffectonFinancialViability 55
2. OtherEffectsontheGranteeHospitals 56
3. EffectsonLocalProviders 57
4. EffectsonAccess 57
E. GRANTFINANCIALRECORDS 59
V SUMMARYOFHOSPITALPROGRESSAFTERONEYEAR ... 60
VI 1990GRANTSOLICITATIONPROCESSANDAPPLICANT
CHARACTERISTICS 62
A. SOLICITINGANDSCORINGTHEAPPLICATIONS
ANDSELECTINGGRANTEES 62
B. GEOGRAPHICDISTRIBUTIONOFTHEAPPLICANTS 63
C. COUNTYCHARACTERISTICSOFAPPLICANTSAND
GRANTEES 64
1. SocialandEconomicCharacteristics 68
2. AccesstoFacilities 70
3. HealthProfessionalShortages 71
D. FEDERALANDEXTERNALFUNDINGANDLOCAL
COOPERATION 73
1. FederalFundingAmounts 73
2. ExternalFunding 75
3. LocalCooperation 76
E. COMPARISONOF 1989AND 1990APPLICANTS 78
F. COMPARISONOF 1989AND 1990GRANTEES 79
VII ACTIVITIESFORTHENEXTSIXMONTHS 84
A. MONITORING 84
B. SITEVISITS 84
C. REPORTTOCONGRESS 85
REFERENCES 86
APPENDIXA: 1990RURALHEALTHCARETRANSITION
GRANTWINNERSLISTEDBYSTATE
APPENDIXB: AREACHARACTERISTICSANALYSIS:
1990APPLICANTS
iii
TABLES
Table Page
I.1 NUMBERANDCHARACTERISTICSOFGRANTEEHOSPITALS
1989AND 1990 4
II.1 MANAGEMENTCHARACTERISTICSATTIMEOFAWARD:
1989GRANTEES 10
11.2 METHODOFMEDICAREPAYMENTANDFINANCIAL
CHARACTERISTICSATTIMEOFAWARD: 1989GRANTEES . 13
11.3 STAFFINGATTIMEOFAWARD: 1989GRANTEES 15
11.4 SERVICEAREACHARACTERISTICSATTIMEOFAWARD:
1989GRANTEES 18
11.5 SERVICESPROVIDEDIN 1989: 1989GRANTEES 22
11.6 CONSIDERATIONOFCONVERSION,CONSOLIDATION,
ORCLOSURE: 1989GRANTEES 25
111.1 DISTRIBUTIONOFPROJECTTIMELINESSBYWHO
DIRECTSPROJECTANDPROJECTOBJECTIVE:
1989GRANTEES 28
111.2 PERCENTAGEOFGRANTFUNDSSPENTBYPROJECT
TIMELINESS: 1989GRANTEES 40
IV.1 NUMBERSANDCHARACTERISTICSOFGRANTEESVISITED 46
VI.1 NUMBEROFELIGIBLEHOSPITALSANDNUMBEROF
APPLICANTSFOR 1990RURALHEALTHCARE
TRANSmONGRANTS 65
VI.2 SOCIALANDECONOMICCHARACTERISTICSOFCOUNTY:
1990APPLICANTS 69
iv
TABLES(continued)
Table Page
VI.3 COUNTYSUPPLYOFSERVICESANDFACILITIES:
1990APPLICANTS 72
VI.4 PERCENTAGEOFHOSPITALSLOCATEDINCOUNTIES
DESIGNATEDASPRIMARYCAREHEALTHMANPOWER
SHORTAGEAREAS(HMSAS)IN 1987ANDWITHA
NATIONALHEALTHSERVICECORPS(NHSC)SITE
IN 1986: 1990APPLICANTS 74
VI.5 EXTERNALFINANCINGOFFUNDEDANDNON-FUNDED
PROPOSALS: 1990APPLICANTS 77
VI.6 COMPARISONOFTHEAREACHARACTERISTICSOF
1989AND 1990GRANTAPPLICANTS(ATTIMEOFAWARD) . 80
VI.7 COMPARISON OF 1989 AND 1990 GRANTEES (AT TIME OF
AWARD) 82
v
FIGURES
Figure Page
111.1 TOTALEXPENDITURESAFTERTWELVEMONTHSBY
CATEGORY: 1989GRANTEES 36
111.2 PERCENTAGEOFFIRSTYEARFUNDINGSPENT
AFTERTWELVEMONTHS: 1989GRANTEES 39
vi
EXECUTIVESUMMARY
The Health Care Financing Administration (HCFA) was charged by Congresswith
implementing a program of Rural Health Care Transition Grants (Omnibus Budget
Reconciliation Act of 1987: P.L. 100-203) and expanding the program (Omnibus Budget
ReconciliationActof1989:P.L. 101-239). Thegoalofthisprogramistoassistsmallrural
hospitalstoincreasetheirlongtermfinancialstabilityandmanagementcapacity.
Awardsofupto2yearsdurationandupto$50,000ayearperhospitalweremadeon
September 15, 1989,to 181hospitals,representing184grantawards. Additionalawardsof
upto3yearsandupto$50,000ayearperhospitalweremadeonSeptember 15, 1990,to
211hospitals,representing212grantawards. Grantswereawardedbasedontechnicalmerit
and with the goal of achieving geographic dispersion of the grant funds. There was
$8,254,442 appropriated for funding the first year ofthe 1989 grantees and $16,798,351
appropriatedforfundingthesecondyearofthe1989granteesandthefirstyearofthe1990
grantees.
The legislation mandated that the HCFA Administrator report to Congress every
6monthson the progressofthe program. Thisisthethird6-monthreport. Thisreport
describes the management, staffing, services provided, and financial status of the 1989
grantees, and their progress after 1 year, based on background reports and monitoring
reports submitted by the grantee hospitals covering the period March 1, 1990, through
September 15, 1990, and information gathered duringvisits to 15 grantee hospitals. In
addition, thisreportdescribes howthe 1990granteeswereselected, theprojectstheywill
implement,andtheareasinwhichtheyarelocated.
1989 Grantees. One year after the awards, 171 ofthe 181 hospitals that received
grantsareoperatingtheirgrantprojectsasplanned,while5havecompletedtheirprojects.
Fivehospitalsarenolongerintheprogrambecauseofvoluntarywithdrawal(3hospitals),
nonrenewalbyHCFA(1hospital),andfacilityclosure(1hospital).
Justoverhalfoftheprojectsareonschedule,andnoneoftheprojectsthatisbehind
scheduleisinseriousdifficulty. Mostprojectsincludeseveralactivitiesandmanygrantees
are further aheadwith some activities than others. After 1 year, more than halfofthe
projects including market analysis and planning have completed this component oftheir
projects,andonethirdofthe projectsintroducinganewoutpatientservice have doneso
successfully. The activities most likely to be behind schedule are construction and
renovation, recruiting health care professionals, and introducingswing beds (all ofwhich
dependpartlyonpersonsororganizationsoutsideofthehospitalforcompletion).
vii
The factors most affecting project success are the availability of funds (grant and
other),cooperationwithotherprovidersorgovernmentagencies,dedicationofhospitalstaff,
and success in recruiting or retaining personnel. Conversely, problems arise when these
factorsareabsent.
Hospitalssubmittingprogressreportsintimeforinclusioninthisreporthadspent
two-thirdsoftheirfirstyeargrantfundsduringthatyear. Ofthegrantfundsthathavebeen
spent, 41 percent were spent on personnel, 23 percent on contracts, and 18 percent on
capitalexpenditures. Themajorityofthehospitalsthathadspentlessthanone-halfoftheir
firstyearawardsarebehindschedule. HCFAhasallowedhospitalstocarryforwardunspent
firstyeargrantsintothesecondyear. Inaddition,HCFAawarded$7,408,702newmoney
tothe 171hospitalswithgrantprojectsthatcontinueintothesecondyear.
Itistooearlytotellhowthegrantprogramwillaffectaccesstocare. Manyhospitals
havejustfinishedthe planningstagesoftheirgrantsandarejustbeginningtoactonthe
informationlearned. However,someprogramshavestartedtoservepatients,providinglocal
accesstoservicesthatwerepreviouslyunavailable. Otherhospitalshaverecruitedphysicians
whohavebeguntotreatpatientsintheruralareas,againincreasingaccesstohealthcare.
Whetherthesegrantprojectswillactuallyaffectthelongrunviabilityofthehospitals,and
inturnaffectaccesstohealthcareinthelongrun,isstillunknown.
applic1at9i9o0nsApptlhiacnanitns.19I8n9.1990O,n50S2epaptpelmibceatrio1n5s,we19r9e0,reHceCivFeAdfarwoamr4d8e1dho2s1p2itaglrsa,nt2s02tofe2w1e1r
hospitalsforatotalgrantfundingof$9,389,649.
The types of projects proposed and the geographic distribution ofapplicants were
rather differentthan in 1989, butthe characteristics ofthe areas inwhichapplicantsand
granteesarelocatedweresimilarin 1989and 1990.
Hospitals in 43 States applied for grants in 1990. Eligible hospitals in the North
Centralregionhadthehighestapplicationrate(38percent)andthoseintheNortheastern
region had the lowest application rate (17 percent). Iowa had the largest number of
applicants(47)andthesecondhighestapplicationrateofanyState(56percent).
Theareasinwhichtheapplicanthospitalsarelocatedarescarcelypopulated(averaging
22 persons per square mile), have a higher proportion ofthe elderly than the national
average (15 percent), have populations that are 92 percentwhite, and annual percapita
incomes of $11,500. Fifty percent ofthe areas are designated as Primary Care Health
Manpower Shortage Areas. The area characteristicsofapplicants and granteesarevery
similar.
viii
Comparison of 1989and 1990Grantees. Compared tothe 1989grantees, the 1990
grantees are located in slightly less populated areas, and have smallerblack populations.
This is probablybecause therewere farmore applicants in 1990fromthe NorthCentral
regionandfewerfromtheSouth. The 1990granteesareslightlysmallerhospitals.
Thepredominantprojectobjectivesamong 1990granteesarerecruiting(49percent),
developing a rural health network (37 percent), and management improvements and
planning(32percent),9percentofthe hospitalsappliedforagranttoconverttoarural
primary care hospital. In contrast, the predominant objectives of 1989 grantees were
introducinganewoutpatientservice(70percent),managementimprovements(35percent)
andrecruitinghealthprofessionals(30percent).
ix
INTRODUCTION
I.
A. LEGISLATIVEHISTORYANDPURPOSEOFTHEGRANTPROGRAM
Congressionalconcernsabouttheproblemsofruralhospitalsandaccesstohealthcare
fortheresidentsofruralareasledtotheenactmentoftheGrantProgramforRuralHealth
Care Transition, fn the legislation, Congress mandated that the Health Care Financing
Administration(HCFA)"establishaprogramofgrantstoassisteligiblesmallruralhospitals
andtheircommunitiesintheplanningandimplementationofprojectstomodifythetypeand
extentofservicessuchhospitalsprovideinordertoadjustforoneormoreofthefollowing
factors:
(1) Changesinclinicalpracticepatterns
(2) Changesinservicepopulations
(3) Decliningdemandforacute-careinpatienthospitalcapacity
(4) Decliningabilitytoprovideappropriatestaffingforinpatienthospitals
(5) Increasingdemandforambulatoryandemergencyservices
(6) Increasingdemandforappropriateintegrationofcommunityhealthservices
(7) The need for adequate access to emergency care and inpatient care in areas in
whichanumberofunderutilizedhospitalbedsarebeingeliminated."1
'OmnibusBudgetReconciliationActof1987(P.L. 100-203),Section4005(e).
1