Heidi Heitkamp (00:03):

When I look at challenges for rural America going forward, I think this healthcare challenge, like I said, cannot be overstated. And the last thing the federal government needs to do is add another nail to the coffin of rural healthcare care.

Speaker 2 (00:24):

Welcome to Hospitals in Focus from the Federation of American Hospitals. Here’s your host, Chip Kahn.

Chip Kahn (00:34):

Hello and welcome to Hospitals in Focus. I’m your host, Chip Kahn. We so appreciate your listening.

(00:41):

It’s a concept we hear a lot about, especially during election years, this idea that there are two Americas, one rural and one urban. The divide between the two is real, particularly regarding access to healthcare. So with roughly 60 million Americans living in rural areas, how do we make sure they have access to care they need and when they need it, and what action can help bridge that gap?

(01:06):

Joining me today is former Senator Heidi Heitkamp of North Dakota. She has lived the issue as a political leader and personally. She spent her time in Washington fighting for the needs of rural America and continues those efforts today by leading the One Country Project.

(01:23):

Senator, thanks so much for joining us today.

Heidi Heitkamp (01:26):

Thank you for having me. And there’s no more significant and important topic in rural America than rural healthcare, so you have queued it up just right. The one thing I want to say is I always start my discussions about the urban-rural divide this way. I say, look, what a cab driver in New York wants for his family is no different than what a small business owner in Carrington, North Dakota wants. They want good education, they want safety and security, and they want good healthcare, and they want their kids to experience a life that is better than the life that they had. And so for all the divisions that we draw, urban-rural, at the end of the day, 90% of what we want in life is pretty common across that divide.

Chip Kahn (02:11):

Well, that’s a great start. And let’s take from that theme and say, so the issue really is how do we make sure regardless of where people live, that they get what they need to live the kind of life they would expect to live in America? And along those lines, there are differences between how you deliver healthcare, how you deliver education, how you pay for it between rural and urban America. And can you give us some sense of how you would characterize rural America, particularly aspects that make it maybe more difficult to achieve some of those goals that Americans expect than in an urban area?

Heidi Heitkamp (02:49):

Well, I think the first thing that we have to realize is this is a historic problem. When you look at electrification of the United States, rural America was left behind because the last mile was pretty expensive. So when you’re living in farms at that time, half a mile apart to string line and provide a service to that few of people in terms of concentration was always going to need to be, for lack of a better word, subsidized. That’s why we have the rural electrification movement. When you look at rural water, same thing. It’s a lot easier to deliver potable water in a city where you have that concentration than it is to get it to a farm or to an Indian reservation where the next home or town maybe miles away. And so this is the age-old problem.

(03:41):

When you think of economic concepts, you think of economies of scale, and it’s very hard to scale service delivery in rural America because the concentration isn’t there, therefore the customer base isn’t there, population base isn’t there. But that does not mean that we should ever in any way leave people without healthcare, without potable water, without electricity, without broadband. We are one America, we call this the One Country Project for a reason, and it’s our goal to acknowledge the differences and then seek the policy solutions that can help.

(04:19):

Will a rural hospital look like a downtown New York hospital? No, it won’t. But the need for a hospital can be acknowledged by everyone. And when we’re talking about the healthcare system, think about the ambulance system, think about what it takes to basically train and run an ambulance in a population that’s not dense.

Chip Kahn (04:41):

This discussion about density, I guess really defines healthcare in a way in rural America. I’ve had a lot of discussions. We had him on our podcast twice, Alan Morgan, head of the National Rural Health Association, and he often talks about the concept of 30 miles or 30 minutes to access needed care. What do you think the standard ought to be to make people comfortable that they have access? And I guess transportation is a key issue here.

Heidi Heitkamp (05:11):

Yeah. And also defining what care looks like. By that measurement we’re failing in terms of OBGYN services, delivery of children’s services. Even in North Dakota that has a very robust rural healthcare system you have to drive many times 70 miles if you’re delivering. And what does that mean in terms of anxiety for a mother who thinks, if I go into labor and I need immediate attention, what does that look like? So I think we have to define what kind of healthcare is critical in that 30/30 process and are there ways to deliver that healthcare in ways that appreciate the economies of scale, but also provide for workarounds?

(05:57):

We had a rural hospital in Valley City, and Valley City’s, by a lot of people’s standards and North Dakota is not rural, it’s a town of about 5, 6,000. So we don’t consider that rural. But they needed an emergency service. They basically did tele-emergency service because there’s no way they were going to get a doctor to be on call in that town to provide that service, nor would necessarily a doctor be comfortable given the kind of complexities of things that come in emergency. And so, I think we have to talk about re-examining what it is, the expectations that rural America can have about hospitals and healthcare. And then figuring out ways that we can be better at delivering that locally, still provide quality of care, but may not look like it would in an urban hospital.

Chip Kahn (06:57):

One of the things that marks rural hospitals right now as a group is that many hundreds of them have closed and every year, 10, 15, 25 rural hospitals close. Can we talk about what happens in a community when that facility closes and how do you close the gap that’s then there? You were describing one kind of mitigation, but how do communities respond when this happens?

Heidi Heitkamp (07:27):

Honestly, a couple things I want to say about that. The states that have expanded Medicaid, because we also know that the average wage in rural America may not be what is affordable. Expanding Medicaid has provided a revenue stream to make sure that the services that you’re providing will be paid for. Because the last thing, a rural hospital that is struggling needs is debt that has to be collected. Obviously they’re going to continue to provide that service, but any kind of insurance reform that makes sure people have insurance is critical.

(08:04):

I think that the other thing about hospitals in rural America is that they are typically the number one employer outside of the farm or outside of a small business in rural America. And when the hospital closes, let me tell you, that has huge economic effects in the community, not just because you’re laying off all that workforce that has now found employment in a hospital, but it has huge effects because you have people questioning whether they should live in rural America.

(08:39):

By that I mean let’s take somebody moved away, we’ll give a North Dakota example, moved to Fargo and Grandma’s still in Crosby, North Dakota. And the healthcare system there isn’t what it was when Crosby had a much population. And now you want your mom to have access to healthcare, so all of a sudden you’re going to move her to Fargo so you can be closer to her, you can provide for her, and you know that medical services are readily available. And I think it’s that hollowing out when we don’t provide healthcare of rural economies, that doesn’t get a lot of attention.

Chip Kahn (09:18):

One of the things that I guess is characteristic of that hollowing out is you end up in communities, I guess, with some young people and a lot of old people. I’m sort of one of those older people, so there’s nothing wrong with it, but it does mean that you’ve got a lot of people that are on Medicaid and a lot of people that are on Medicare. And so a few people in the middle with coverage. So Medicare and the Medicaid programs become really critically important. Which gets us to some of the adjustments that Congress has adopted for Medicare over the years, low-volume hospitals, Medicare-dependent hospitals, that’s so critical.

(09:59):

Can you talk a bit about the importance of these kinds of programs and other programs inside of Medicare and Medicaid that sort of make rural healthcare work in terms of facilities?

Heidi Heitkamp (10:11):

Well, let’s start out with this idea that we had in the late-1990s before kind of thinking about universal healthcare coverage. When you think about what that looks like, it used to be in these federal programs, that large city hospitals were advantaged in terms of what they would pay for procedures. Why is that? Because they considered the cost of living in those communities to be the determinant factor of what healthcare would cost, not acknowledging density. And so over time you saw frontier hospitals, you saw critical access hospitals, you saw an awareness building of what needed to happen in rural healthcare.

(10:53):

And so it cannot be overstated, and I will say this clearly, that rural hospitals will live and die with federal programs, not just those programs, but veteran services. They’ll live and die with CHIPS, with Medicaid expansion, all of these federal programs as federal government as a provider. Just to calibrate people at one point, the public health officer in North Dakota was a dear friend of mine and he said 70% of all healthcare in North Dakota was paid by the federal government. Think about that. And you know Chip, that as the federal Medicare and Medicaid system goes, third-party providers will follow. And so the system system is so dependent on making sure we get federal policy right and state policy to the extent that states can be adaptive to additional services under Medicaid and Medicare for rural hospitals.

(11:55):

I also want to say this because we haven’t mentioned it yet. One of the big challenges that these hospitals, other than reimbursement rates and keeping the doors open and continuing challenges with a lack of a dense population, one of the challenges that you have is maintaining workforce. As hospitals in, again I’ll go back to Fargo, will pay an RN 40% more than what a hospital in a rural part of North Dakota can pay. Where is that RN going to go? Where is that doctor going to go? What’s the lifestyle that’s being provided for those high-level medical workers? And so these are all huge challenges that can only be met when we have the right federal policies and the right goals for rural healthcare.

Chip Kahn (12:48):

According to the Medicare Commission that advises Congress on Medicare policy, they say that hospitals across the board get paid about 88 cents on the dollar. So they already are paid below cost. And I know how that’s really critical to these smaller hospitals and affects them even more because they don’t have economies of scale to try to get around some of the effects of a Medicare payment being under cost. So what’s worrisome to me is the discussions in Congress about so-called site neutral policies that somehow were going to neutralize payment between hospitals and other providers outside in other settings. In the rural areas, you don’t have people in other settings you just got the hospital and a cut is a cut. So I know you’ve been following that issue and it does raise concern.

Heidi Heitkamp (13:45):

I mean, it could be the death nail for further rural hospitals, including those hospitals that are in states that basically advanced Medicare expansion or embrace Medicare expansion. And so the real challenge that you have in the whole continuum of healthcare public health system, which was decimated during COVID for rural counties, lots of controversy around public health, but that wellness entrance that people should have to the healthcare system. And then looking at kind of overall what’s the population? We know based on studies that people who live in rural communities have more chronic diseases, in part because they’re older than average. And so to simply say we’re going to treat everybody alike, there isn’t any difference, is a complete lack of focus about what needs to happen for rural healthcare.

(14:44):

When I was in the Senate I a co-chaired the Rural Health Conference because I really see this, when I look at challenges for rural America going forward, I think this healthcare challenge, like I said, cannot be overstated. And the last thing the federal government needs to do is add another nail to the coffin of rural healthcare.

Chip Kahn (15:06):

I read the other day that farmers have really taken up the Exchange coverage that’s provided under the Affordable Care Act. I mean obviously they have jobs, they’re working. But they’re not part of a group, they’re individuals or small groups in a community. So the ACA is really important. And one of the things that Congress did since COVID was increase the subsidies for ACA, I know how important that is, and it goes through next year. What do you see as the role of the Exchange coverage in rural America that’s replaced the old individual market that gave people coverage without much coverage?

Heidi Heitkamp (15:49):

Again, the great irony of this is no one was more skeptical and voted more against the ACA than rural America, but it’s saving rural America in terms of Medicaid expansion. And now I can tell you, I know farm families that were spending $1,000 a month to get healthcare went out on the Exchange and now it’s 200. Think of what that does for the rural economy. When you’re not taking that much money out of the economies just for healthcare coverage, for insurance coverage. You’re actually able to reinvest that in your farm. You’re able to maybe start a small business because you don’t have to worry about just getting a job for healthcare. I can’t tell you the number of people in rural America who work for healthcare coverage.

(16:34):

And the clearest thing that Congress can do is continue that subsidization and not let it expire for certain populations for sure. And so I could give you dozens of examples where the ACA and the Exchange has been absolutely a lifeline for moderate income rural Americans. I hope that commitment to keeping healthcare affordable in rural America continues.

Chip Kahn (17:04):

One of the other changes that’s taking place since ACA is that Medicare Advantage, which is managed care Medicare, frankly is the fastest growing part of Medicare. For all Medicare beneficiaries it’s now well over 50%. From some accounts it’s about 35% for those eligible for Medicare and rural communities. And in seven states in rural areas it actually is exceeding 50% penetration. So what’s the effect of that? Because these plans may or may not pay Medicare rates, and you’ve got critical access hospitals and other hospitals that really depend on the way Medicare-fee for service is structured. And now you’ve got this new player out there providing coverage. How do you see its effect on communities?

Heidi Heitkamp (17:59):

Well, I think there’s been studies and the alarm has been sounded about the growth of Medicare Advantage and what that means for rural hospitals, precisely for the reasons that you discuss. I bet you in North Dakota it’s over 50% in terms of Medicare Advantage. People just are going to go where they get the most for the dollars that they’re investing. A lot of these plans are very affordable. When you look at a regular Medicare supplement running about $250 and you can get a pretty good plan, in fact a plan that pays more for $70 a month, where are you going to go? But we always forget that that comes at a cost when you’re taking that additional dollars out of the system. I think people have voted with their feet, they’re taking these choices, but I think that we really need further study on Medicaid Advantage and how that’s going to work in rural hospitals.

Chip Kahn (19:00):

Yeah, I think we need a balance there. And the agency that oversees Medicare and Medicaid for the federal government, CMS, is taking some action, putting some guardrails around prior authorization and hopefully all the discussion about denials for Medicare Advantage patients will have an effect. We can really move forward with products that on the one hand, like you say, will help those in rural America get that important Medigap coverage, less expensively, but at the same time not shortchange them overall when they actually need care at the other end of the coverage.

Heidi Heitkamp (19:43):

Yeah. You know, Chip, one of the things that I used to say is we should lower the age for Medicare. And people go, why? You’re crazy. We can’t afford it already. And I said, number one, it should reduce insurance costs in the private marketplace because you have younger, healthier people in that marketplace. And it should reduce the cost, the insurance costs because you’re bringing younger, healthier people into Medicare earlier. And so there’s a lot of kind of workarounds that I think need to be explored.

(20:15):

The challenge in healthcare is really, number one, how do you get the people to provide the service? And then how do you afford it in rural America? So it’s about workforce, it’s about infrastructure. If you’re using X-ray equipment from the 1990s, people aren’t going to be comfortable with that. They want higher level investment in equipment. My husband’s a family physician for full disclosure, and I asked him, I said, would you ever think about practicing in a rural hospital? He said, it’s frightening to practice in a rural hospital because you don’t have the equipment, you don’t have the staff, and you don’t have a colleague that you can bounce ideas off of. And so there’s a lot of insecurity that people have this idea of Dr. Welby or the hometown doc, that’s a pretty lonely existence if you’re in a rural community. And so the kind of federal policies on workforce need to be addressed.

(21:14):

And it’s not just about paying off student loans because what frequently happens, because we have a medical shortage, which you and I haven’t talked about here, medical workers shortage, those hospitals who want to compete and get that worker to their hospital will buy out the contract. And so there’s a lot of things that have been tried, none very successfully in my opinion, to keep workforce. And then you add the economic stress. I mean, I know a woman who was basically the CEO of a rural hospital and she took the job only because no one else would take it in the community. And she’s a hero to me because she’s made it work. I mean, she just dug in. But the stress she’s under every day to meet payroll, no one can overstate that and she’s involved in providing an essential service. So we should make our life a little easier.

Chip Kahn (22:06):

Well, along those lines, you started the One Country Project. Let’s sort of close out with some discussion about what its mission is, what you’re trying to accomplish and what it’s workforce or other issues. What kind of issues are you focusing on on the healthcare side that are relevant to the discussion that we just had?

Heidi Heitkamp (22:27):

Well, first off, Medicaid expansion, the right federal policies, but making sure those federal policies are adopted. Now, let’s think about the Exchange. Remember when the Exchange first came out, states didn’t want to be part of it. Minnesota, it runs a wonderful Exchange. So the states who have basically run their own Exchange can tailor that Exchange for their individual needs of their state. But a lot of states like North Dakota, had it only been available from state government, they wouldn’t have an Exchange. They wouldn’t have a place to go to get affordable healthcare. And so what we want to do is remind people that these policies, they may be political footballs back and forth, but these policies affect life. They affect real life.

(23:16):

I also want to talk about opioids. Opioids that has hit so much of rural America disproportionately than maybe some urban areas. When you look at that, I think at the time that I left office, 80 to 90% of all treatment for opioid addiction was paid for by Medicaid. So talk about a healthy community and what you need to do for a healthy community. So it’s talking about how healthcare affects all these other issues that challenge rural, whether it’s the economic issues, whether it is the kind of migration to bigger places to get healthcare. So we look at those things at One Country that we think people aren’t paying attention to and that need a better policy discussion, need to understand the values of certain policies, whether it’s the ACA, whether it is making sure that frontier hospitals and critical access hospitals are recognized and compensated differently. So in the healthcare space, we do that.

(24:19):

One emerging issue that I don’t think has gotten a lot of attention is the aging housing infrastructure in rural America. And think about this. If you build a house in Fargo, chances are you’re going to recover your costs. But if you just aren’t building material alone in a rural part of the state, that house isn’t going to appraise at a value that’s consistent with your mortgage. And so we think that an emerging issue at One Country is rural housing, and that needs to be talked about, and we need to look at how we can continue to provide banking services, how we can continue to provide potable water.

(24:58):

If you said, what’s the mission? I always say it’s to reintroduce America to the challenges of rural America from a more less 1950s version of rural America and to talk about how we can bridge those divides between urban and rural America. I’m going to end my diatribe on One Country where I started, which is we aren’t that different in rural and urban America. We all want the same things. It just takes a different set of opportunities and interventions in rural America to continue to keep our population.

Chip Kahn (25:37):

Well. We so appreciate your leadership there, and clearly it’s important to have groups like you’ve set up with One Country to focus attention on all these issues that really relate to, you could argue, its lifestyle, but also it’s those social determinants that really mark a person’s life and tells you whether or not they’re going to have good healthcare. Because if you don’t have housing, because if people in your community are suffering from the opioid pandemic, it’s going to make it difficult for everyone. It’s going to add stress to everyone, and it’s going to make it hard to have sort of a proper healthcare environment.

Heidi Heitkamp (26:20):

And workforce, workforce, workforce. I think at one point we talked about whether there was a psychiatrist that lived in North Dakota, west of Jamestown. North Dakota is a pretty sophisticated place. Think about the inability… And the work around there is telehealth, mental health, and that can be effective. The VA has structured a great program, but this is just an example of what we’re trying to do. Which is number one, recognize and educate people that there needs to be additional investments in rural America, but that we also are looking at how we can manage our economies of scale differently in rural America. So it’s not just give us what we want. It is, this is what we need. And I think right now in healthcare, our needs aren’t being met. And you can see it in the lack of services, and we haven’t even touched emergency services, which is a huge challenge in rural America.

Chip Kahn (27:24):

Well, I appreciate, and I’m sure all of our listeners appreciate all you do because it will make a difference with that kind of in intentioned focus on these issues. So thanks a lot and really appreciate you taking some time with us today to have this podcast.

Heidi Heitkamp (27:42):

Well, Chip, anytime that I can get a platform to preach the gospel of what we need in rural America, it is so appreciated by us. And like I said, I see this issue not only from the standpoint of what we expect as Americans in terms of healthcare, but also a huge economic issue in rural America.

Speaker 2 (28:08):

Thanks for listening to Hospitals in Focus from the Federation of American hospitals. Learn more at fah.org. Follow the Federation on social media at FAH Hospitals and follow Chip at Chip Kahn. Please rate, review and subscribe to Hospitals in Focus. Join us next time for more in-depth conversations with healthcare leaders.

Speaker 4 (28:30):

Heidi Heitkamp

U.S. Senator Heidi Heitkamp served as the first female senator elected from North Dakota from 2013 – 2019.

During her six years in the U.S. Senate, Heitkamp quickly became a proven negotiator who worked across the aisle to fight for rural America. She personally showed that if senators work together, it can lead to real solutions. Throughout her time in the Senate, Heidi prioritized improving the lives of Indigenous people and working families, stopping human trafficking; guaranteeing affordable health care; addressing childhood trauma; eliminating unnecessary regulation; and securing an energy policy that keeps cost low but achieves climate goals. Providing equal economic opportunity to Rural America continues to be her lifelong pursuit.

Heitkamp previously served as North Dakota’s Attorney General, and elected state Tax Commissioner. She serves on numerous boards including The McCain Institute, The Howard Buffett Foundation, and The German Marshall Fund. She is the founder and Chair of the One Country Project, an organization focused on addressing the needs and concerns of rural America. Heidi was recently named the Director of the Institute of Politics at the University of Chicago, a university she has long been committed to and a place where she enjoys engaging with students over civic discussions while encouraging them to seek opportunities in public service to our country. Heidi also serves as a contributor to both CNBC and ABC News.