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Strengthening the Rural Health Infrastructure
Developing Your State's Strategy
Dan Campion, Alpha Center, Washington, DC.
This session provided an opportunity for participants to discuss further what issues, strategies, or concerns they are
considering with regard to strengthening rural health systems in their States and communities.
Medicaid Managed Care
Among the topics addressed
was Medicaid managed care.
Many States are moving to mandatory managed care for their Medicaid programs. This is
driving the development of managed care in rural communities in these States. The issue of counties taking on risk was
discussed. If counties propose to act as Managed Care Organizations (MCOs) and take on full risk, ultimately property taxpayers would be responsible.
One participant noted that purchasing reinsurance could help minimize the county's risk. Also raised regarding managed
care was whether plans would be required to include public health functions.
Provider-sponsored Organizations (PSOs)
On the issue of licensing provider-sponsored organizations (PSOs) and developing rules for risk-bearing health plans, a few ideas emerged. All agreed that
State offices of rural health should get involved when the State departments of insurance discuss these issues. One
participant said her State already requires a certificate of insurance or reinsurance to be licensed. It also makes certain
exceptions for these entities if they are contracting with Medicare or Medicaid. Another participant added that the number
of enrollees needs to reach a "critical mass" in order for a network to have a stable risk pool but that few rural advocates
understand these insurance concepts thoroughly.
A concern was raised regarding the low level of funds allocated for the Health Care Financing Administration (HCFA) to educate the public on the new
Medicare+Choice program. It was felt that $95 million was not adequate to the task and that States might want to consider
providing additional information to rural Medicare beneficiaries through senior centers or other programs (e.g., Area
Agencies on Aging).
It was noted that rural areas, on average, have a higher percentage of uninsured persons than urban areas and that high
numbers of uninsured place a tremendous burden on rural systems. It was also noted that State and national solutions are
needed, as well as local involvement, and that rural areas may need special attention given the fragility of the health care
Current as of November 1997
Previous Section Contents
Strengthening the Rural Health Infrastructure: Network Development and Managed Care Strategies. Workshop Summary, November 19-21, 1997, User Liaison Program. Agency for Health Care Policy and Research, Rockville, MD. http://www.ahrq.gov/news/ulp/ulpstren.htm