New tax bill brings major changes to rural hospitals

Kearny County Hospital (KSN File Photo)

LAKIN, Kan. (KSNW) – With all the coverage of the tax bill that passed late last year, one aspect that may have been overlooked was its effect on rural hospitals. Administrators tell KSN the tax law will make it harder to keep the doors open.

The new tax law removed the individual mandate from the Affordable Care Act. According to the nonpartisan Congressional Budget Office, that means 13 million fewer people will be insured.

“We’re heading in the wrong direction if we’re disincentivizing people to carry health insurance,” said Ben Anderson, Kearny County Hospital CEO.

Anderson says they see an additional 2,000 patients every year.

“As we take care of more and more people, as some of those people are uninsured, we are analyzing what is the sustainability of this growth, and we’re having to choose profitable areas for growth,” explained Anderson.

One of those unprofitable areas is obstetrics. But cutting that would have a big impact on southwest Kansas.

“We delivered 327 babies last year from over a dozen Kansas counties, and we’re continuing to deliver more babies from these counties, primarily because we see it as the right thing to do,” said Anderson.

According to the National Rural Health Association, rural hospitals are projected to lose $2.8 billion in Medicare reimbursements over 10 years as a result of the Budget Control Act of 2011.

Congressman Roger Marshall says the issue for rural hospitals isn’t the number of people insured but the reimbursement rate for hospitals.

“Certainly the ACA has made it very hard on folks in rural hospitals,” said Marshall. “And I think number one is they’ve got decreased reimbursements for Medicare patients, and that decreased reimbursements for Medicare patients disproportionate affects rural hospitals who have more Medicare patients.”

Anderson says as resources tighten on rural hospitals, local taxes tend to rise to keep the doors open.

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