Rural Health Clinic Services Act Has Not Met Expectations

GAO reviewed the progress made by the Department of Health and Human Services (HHS) to implement the Rural Health Clinic Services Act, the extent to which Medicare beneficiaries use the clinics, and any obstacles preventing broader implementation of the Act.

The expectations of the Act have not been fulfilled. Medicare reimbursement to rural health clinics was approximately three sevenths of the amount expected for the year 1980. Many clinics have chosen not to be certified or have relinquished their certification because of reimbursement limitations and administrative requirements. The Act has not significantly increased clinic financial stability and many clinics will continue to require federal grant assistance to survive. Few clinics attract the majority of Medicare beneficiaries in their service areas because patients are choosing private physicians whose offices are closer. Federal reimbursement guidelines prevent many certified clinics from fully recovering incurred and otherwise allowable costs, and federal administrative requirements are costly, time consuming, and further reduce the financial benefits of participation. Public Health Service grants and National Health Service personnel represent a more significant contribution to clinic financial stability than do Medicare and Medicaid revenues. Certain states refuse to allow physician extenders, nurse practitioners, or physician assistants to practice independently and thus nullify a principal objective of the Act. There has been a lack of effort devoted to encouraging states to permit physician extenders to practice and a failure to implement a reimbursement system which would cover the costs which clinics incur in treating Medicare and Medicaid patients.

Recommendations

Our recommendations from this work are listed below with a Contact for more information. Status will change from "In process" to "Open," "Closed - implemented," or "Closed - not implemented" based on our follow up work.

Director: Michael Zimmerman Team: General Accounting Office: Human Resources Division Phone: (202) 275-6195