In the late 1980’s, Kansas created its first office of rural health within the Kansas Department of Health and Environment (KDHE). Its director, Steve McDowell, spent his first months in that role reaching out to a number of stakeholders to listen and learn about the challenges facing rural health care in Kansas. The most pressing problem voiced by a number of stakeholders was the difficulty small communities were having supporting their local hospitals.  More than 50 hospitals had an average daily census of less than five patients.

To address this issue, a partnership of KDHE, The Kansas Hospital Association (KHA) and the Kansas Bureau of Emergency Medical Services (KBEMS)  formed a partnership.  With funding from the Wesley Foundation (now the Kansas Health Foundation), the group formed a Technical Advisory Group representing hospitals, physicians, nurses, emergency medicine, emergency transportation, public health and a number of others.

The group, led by national rural health consultant Steve Rosenberg, explored rural issues in great depth especially the impact the new DRG payment system was having on hospitals with low acute inpatient volume.  They agreed that a new model of health care for very small, low volume hospitals and their communities was critical to the future of access to health care in rural Kansas. In response to a federal call for states willing to test a   new model, the group responded and received the federal grant to participate with six other states in testing a new model.

The new model to be tested included a small, hospital referred to as a Rural Primary Care Hospital (RPCH or “Peach”) supported by a larger organization, the Essential Access Community Hospital (EACH).  The RPCH would go back to payment based on a cost-based system as opposed to the DRG based reimbursement and the EACH received additional payment for their support of the RPCH as a “Sole Community Provider”.  Kansas was able to bring in over $3 million in grants to hospitals and the state to help pilot the new model through the EACH/RPCH (pronounced each/peach) demonstration.

The partners in the application formed a Management Committee for the grant project adding the Kansas Medical Society (KMS) to the team.  Recognizing that this model and others for rural communities would be critical to sustain access to health care, the group named the effort the Kansas Rural Health Options Project (KRHOP or “crop”)

  • To support the pilot hospitals, the management team and consultants developed a number tools and education to help the RPCH and EACH. A financial analysis tool, created by Wendling Noe Nelson and Johnson, analyzed the impact of the new payment approach of the RPCH. The model tested not only the payment for current patient services, but also changes in the workforce necessary to implement the new model. The model was used in other states and set the stage for hospital leadership to determine if an RPCH was a viable option for their community.  A model agreement between RPCHs and EACHs, created by the Buckley Group, (with updates to meet new requirements) is still used today as the starting point for CAHs and their supporting hospitals.  Statutory changes included an exception to the state “corporate practice of medicine” allowing RPCHs to employ physicians and the recognition that an RPCH was still a licensed Medical Care Facility.

In the late 1990’s, The EACH/RPCH program evolved and successfully expanded to all 50 states as the Critical Access Hospital. CAHs were acute care hospitals with 5 or fewer patient beds that were a minimum of 35 miles from another hospital.  As Kansas hospitals were already designated as RPCHs, our hospitals were grandfathered in and the 35-mile rule waived.  Nationally, the distance requirement was a challenge, so states were granted the ability to establish criteria for CAHs as necessary providers under which the 35-mile rule was also waived.  Kansas was among the first to adopt the criteria.

Kansas expertise and resources provided national leadership in the CAH and the Flex program.  The Management Committee, which had become a true partnership, broadened the focus of KRHOP to explore and embrace other models and relationships.  Nationally, the EACH/RPCH Grant Program ended and Medicare’s Rural Hospital Flexibility Program (referred to as the Flex Program) managed by the Federal Office of Rural Health Policy under HRSA was implemented to provide funds to states to develop the expertise and technical assistance capacity convert hospitals into CAHs.

  • Kansas focused its efforts on emerging needs of these RPCHs and ultimately CAHs. After the first hospital networks formed between EACHs and RPCHs, the networks grew allowing small rural hospitals and other providers to benefit from the experiences of the grant project and resources of the Office of Rural Health. ___#__ Rural Health Networks grew from the original five (might have been 3?) based in and staffed by the EACH or supporting hospital. The Management Committee established the State Network Council to support the networks, provide education and share resources.
  • In later years, KRHOP provided direct grants to networks, developed a balanced scorecard (now the Quality Health Indicator program) and began discussion around a new model to integrate health services in a local community called the Community Health Organization. While never implemented, the CHO is still considered as an ideal use of limited health resources in small communities.
  • This work resulted in strongerregional relationships, and hospital and governance buy in on benchmarking to drive improvement. QHi, supported by Flex funding was and still is free and available to all Kansas hospitals.

The CAH requirements gradually grew from a maximum of five acute beds with a maximum stay of 72 hours, to 15 beds allowing for swing-beds and ultimately a maximum of 25 beds of any type and an average of 96-hour acute care stay.

As CAH’s matured, federal policy eliminated the ability of states to establish “Necessary Provider Criteria” which waived the rule that a CAH must be 35 miles from another hospital.  In Kansas, with one or two exceptions, that ended the expansion of the CAH model and the need for technical resources to help hospitals convert.  Kansas focused on improvements to QHi and made the program available to other states.  Kansas also facilitating the community based approach to identifying local health priorities and provided opportunities for technical support through our “Rural Health Works” program.  A pre-cursor to the now required Community Health Needs Assessment.  Quality was the overall focus and hospitals were provided on-site support for quality improvement through a multi-state collaboration “Harvesting Quality in Americas Heartland.”

  • In 2013, The Kansas Rural Health Options Project, responding to changes in the federal Flex funding requirements changed the meaning of its acronym. Today, the Kansas Rural Hospitals Optimizing Performance, the new KRHOP, supports hospitals as they work to improve their financial stability, improve internal processes and provide high quality services.
  • Today, 85 Critical Access Hospitals dominate Kansas rural landscape. At the same time, they continue to struggle with low acute census and new models are being explored to once again align the needs of rural community with their health systems, reduce the costs of care and provide high quality services.