Rural hospitals haven't begun to feel cuts in federal programs, but their supporters say they will if key health professions programs continue to be reduced.
"It's too early to tell about the (hospital) grant programs, but we are really concerned about reductions in programs like National Health Service Corps," said Jennifer Rapp, government affairs director at the National Rural Health Association's Washington office.
The National Health Service Corps took a $4.4 million reduction to $115.8 million in the recently approved federal budget for fiscal 1996, which ends Sept. 30. It provides loans and grants for young physicians who practice in rural areas and inner cities.
The nation's 2,460 rural hospitals often have difficulty attracting physicians. The corps is one of few programs available to rural hospitals to financially entice young physicians.
The NRHA is recommending an increase to $130 million in fiscal 1997, which would be $10 million more than fiscal 1995's $120 million.
Conservative Republicans in Congress have targeted the Office of Rural Health Policy for elimination, but it survived. The ORHP, which is part of a rural healthcare line item in HHS' budget, received $9.4 million for fiscal 1996, the same as in the previous year. The NRHA hopes for a $600,000 increase for fiscal 1997.
The ORHP serves as a national clearinghouse for rural healthcare information. It also provides grants for telemedicine and other research projects.
Rural hospital grants were reduced $4.5 million to $13.1 million in fiscal 1996. The NRHA hopes to have those levels restored to the fiscal 1995 level of $17.6 million in fiscal 1997. "Those grants can be used creatively for a lot of things," Rapp said.
Rural outreach grants, which allow communities and rural providers to collaborate to form delivery systems, increased $1.8 million to $27.8 million in fiscal 1996. That compares with $26 million in 1995.
The NRHA's request for $30.2 million in fiscal 1997 is supported by the Clinton administration.
The administration generally has been supportive of rural healthcare. However, Rapp said, it's difficult to demonstrate the administration's backing because its budget proposal to Congress "clusters" numbers for different programs.
Rural providers also are leery of Medicare and Medicaid cuts, said Harold Brown, past president of the NRHA board and chief executive officer of Prairie du Chien (Wis.) Memorial Hospital. "Medicare and Medicaid are 60% to 70% of rural hospitals' income," he said. "That's the bread and butter of rural hospital finances. Those other grants for research and everything else won't mean anything (if Medicare and Medicaid are cut)."
Brown is hoping a proposal known as REACH, Rural Emergency Access Community Hospital, makes its way back into new budget bills. It would allow rural providers in areas where there is no acute-care hospital to earn a cost-based reimbursement for emergency care. "This is purely to make sure that if a community downsizes from a rural hospital that the government would pay for the care of a Medicare or Medicaid patient," Brown said.