Rural care challenges to value-based care

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Mar 09, 2017

While analysis we’ve produced on value-based care (VBC) has often focused on the industry at large, it’s important to analyze segments, such as the state of VBC in rural care areas. Nearly fifteen percent of the US population lives in rural areas, where different socioeconomic conditions present a unique set of challenges.

A Different Landscape

Improving healthcare revenue cycle management strategies is one of the biggest issues facing rural providers—it’s been the downfall of approximately seventy-eight rural hospitals since 2010. Unable to deal with the complicated nature of revenue cycle management, rural hospitals have been forced to either merge with larger entities or shut down permanently. Exacerbating the problem is the shortage of physicians in rural areas, where only 10 percent of the physician population chooses to practice.


Rural populations also face challenging health issues. Research has revealed some of America’s most rural areas are particularly at risk for opioid addiction and abuse, and many experts expect the problem to only get worse. There is also a significant need for mental health services in rural America, with about 18.7 percent of residents of non-metropolitan counties suffering from some sort of mental illness.


The lack of IT (more specifically analytic) adoption amongst rural hospitals makes it difficult to engage in risk stratification, preventative health strategies and population health management programs. Digitally driven solutions don’t seem to be the immediate answer since internet penetration isn’t widespread. About 39 percent of the rural population does not have broadband access and 48 percent do not own smartphones

Driving population health adoption across rural areas

The increasing high rate of hospital closure within rural settings brings the question of Medicaid expansion into sharp focus. Medicaid organizations must be in a position where they understand the importance of advanced insights through analytics and use it appropriately to drive the levers that are available to them.


The social determinants approach suggests that improving living conditions in such areas as income, housing, transport, employment, education, social support and health services is central to improving the health of rural populations. The Chronic Care Plus program found that 40 percent of client needs are connected to social determinants. Consider these three practical processes to identify factors that affect a community’s social determinants.

  1. Select health improvement priorities to focus on
  2. Address patient engagement level and gaps in care through a robust population health program
  3. Find relevant, evidence-based rural health programs that have worked to solve the issues you discover

To maintain their independence, hospitals must find a way to innovate, leverage the use of analytics and improve revenue cycle management. Lost Rivers Medical Centers addressed this by enabled advanced analytics to prevent duplication, provide accurate coding and capture rural health population preventative compliance. Hospitals in rural areas must make the best use of limited resources to prioritize between high and low risk cases. Mercy Hospital estimated that 90 percent of ED visits were for non-emergency cases. There seems to be a growing culture of overutilization of rural EDs.


Here are some effective ways for hospitals to help the community achieve a higher quality of life at a lower cost:

  • Analyze episodes of care, such as cost and service patterns
  • Forecast the risk index and use risk driver information to provide additional insights to consider when planning resources to include in health improvement programs.
  • Identify and close gaps of care to maintain optimal health and avoid health decline, and their resulting costs.

About the author

Mason Beard

Mason Beard, 
Chief Solutions Officer, Philips PHM

Mason Beard is Chief Solutions Officer for Philips PHM. He leads the strategic and operational development and programs of the Philips Population Health Management group. He is the co-founder of Philips Wellcentive and has deep experience in developing flagship healthcare IT innovations.

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