[House Hearing, 115 Congress]
[From the U.S. Government Publishing Office]





    21st CENTURY MEDICINE: HOW TELEHEALTH CAN HELP RURAL COMMUNITIES

=======================================================================

                                HEARING

                               before the

    SUBCOMMITTEES ON AGRICULTURE, ENERGY, AND TRADE AND HEALTH AND 
                               TECHNOLOGY

                                 OF THE

                      COMMITTEE ON SMALL BUSINESS
                             UNITED STATES
                        HOUSE OF REPRESENTATIVES

                     ONE HUNDRED FIFTEENTH CONGRESS

                             FIRST SESSION

                               __________

                              HEARING HELD
                             JULY 20, 2017

                               __________

[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]



   

            Small Business Committee Document Number 115-031
              Available via the GPO Website: www.fdsys.gov
                                  ______

                         U.S. GOVERNMENT PUBLISHING OFFICE 

26-251                         WASHINGTON : 2017 
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                   HOUSE COMMITTEE ON SMALL BUSINESS

                      STEVE CHABOT, Ohio, Chairman
                            STEVE KING, Iowa
                      BLAINE LUETKEMEYER, Missouri
                          DAVE BRAT, Virginia
             AUMUA AMATA COLEMAN RADEWAGEN, American Samoa
                        STEVE KNIGHT, California
                        TRENT KELLY, Mississippi
                             ROD BLUM, Iowa
                         JAMES COMER, Kentucky
                 JENNIFFER GONZALEZ-COLON, Puerto Rico
                          DON BACON, Nebraska
                    BRIAN FITZPATRICK, Pennsylvania
                         ROGER MARSHALL, Kansas
                      RALPH NORMAN, South Carolina
               NYDIA VELAZQUEZ, New York, Ranking Member
                       DWIGHT EVANS, Pennsylvania
                       STEPHANIE MURPHY, Florida
                        AL LAWSON, JR., Florida
                         YVETTE CLARK, New York
                          JUDY CHU, California
                       ALMA ADAMS, North Carolina
                      ADRIANO ESPAILLAT, New York
                        BRAD SCHNEIDER, Illinois
                                 VACANT

               Kevin Fitzpatrick, Majority Staff Director
      Jan Oliver, Majority Deputy Staff Director and Chief Counsel
                     Adam Minehardt, Staff Director
                     
                     
                     
                     
                     
                     
                     
                     
                     
                     
                     
                     
                     
                     
                     
                     
                     
                     
                     
                     
                     
                            C O N T E N T S

                           OPENING STATEMENTS

                                                                   Page
Hon. Rod Blum....................................................     1
Hon. Brad Schneider..............................................     2
Hon. Al Lawson...................................................     3
Hon. Trent Kelly.................................................     4

                               WITNESSES

Ms. A. Nicole Clowers, Managing Director, Health Care Team, 
  United States Government Accountability Office, Washington, DC.     5
Ms. Barb Johnston, Chief Executive Officer and Co-Founder, 
  HealthLinkNow, Sacramento, CA..................................     6
Mr. Michael Adcock, Administrator, Center for Telehealth, 
  University of Mississippi Medical Center, Jackson, MS..........     8
David Schmitz, M.D., President, National Rural Health 
  Association, Washington, DC....................................    10

                                APPENDIX

Prepared Statements:
    Ms. A. Nicole Clowers, Managing Director, Health Care Team, 
      United States Government Accountability Office, Washington, 
      DC.........................................................    32
    Ms. Barb Johnston, Chief Executive Officer and Co-Founder, 
      HealthLinkNow, Sacramento, CA..............................    43
    Mr. Michael Adcock, Administrator, Center for Telehealth, 
      University of Mississippi Medical Center, Jackson, MS......    49
    David Schmitz, M.D., President, National Rural Health 
      Association, Washington, DC................................    53
Questions for the Record:
    None.
Answers for the Record:
    None.
Additional Material for the Record:
    CCA - Competitive Carriers Association.......................    62
    GAO Report...................................................    65
    The National Congress of American Indians and The National 
      Indian Health Board........................................   137
 
    21st CENTURY MEDICINE: HOW TELEHEALTH CAN HELP RURAL COMMUNITIES

                              ----------                              


                        THURSDAY, JULY 20, 2017

                  House of Representatives,
               Committee on Small Business,
     Subcommittee on Agriculture, Energy and Trade,
                                             joint with the
             Subcommittee on Health and Technology,
                                                    Washington, DC.
    The Subcommittees met, pursuant to call, at 10:00 a.m., in 
Room 2360, Rayburn House Office Building, Hon. Rod Blum 
[chairman of the Subcommittee] presiding.
    Present: Representatives Chabot, Luetkemeyer, Radewagen, 
Kelly, Blum, Comer, Gonzalez-Colon, Bacon, Fitzpatrick, 
Marshall, Lawson, Espaillat, and Schneider.
    Chairman BLUM. Good morning. I call this hearing to order. 
The Subcommittees are here today to examine how the expansion 
of telehealth services may benefit small businesses and rural 
communities. Telehealth or telemedicine refers to the use of 
online video or telephone communication to deliver healthcare 
services that are to replace or supplement existing healthcare 
services.
    Telehealth is becoming a vital component of medical 
treatment, particularly in areas where there are provider 
shortages, such as rural areas where I am from, or for 
conditions that require regular monitoring.
    While 20 percent of Americans live in rural areas, only 9 
percent of physicians practice there. Rural communities often 
struggle with provider shortages, requiring patients and their 
families to travel long distances to access medical care.
    Telehealth may allow rural physicians to expand their 
patient base and to keep dollars in the community, benefitting 
other local small businesses, such as retail establishments and 
restaurants, contributing to a sense of community that American 
small towns pride themselves on. Expanding use of telehealth 
services may even attract physicians to open or relocate 
practices in rural areas without worrying about having enough 
local patients to stay in business. Those of us from rural 
areas would not want to live anywhere else, yet new physicians 
often have concerns about opening a viable practice in a rural 
community.
    Our witnesses today will discuss the current use of 
telehealth and the barriers that are providing wider use. I 
want to thank all of them for being here today. We look forward 
to hearing your testimony. And I now yield to the ranking 
member of the Subcommittee on Agriculture, Energy, and Trade, 
Mr. Schneider, right on cue, for his opening statement.
    Mr. SCHNEIDER. Thank you, and I am sorry I am late. 
Elevators. Anyway, I want to thank the panelists for being here 
and taking the time to share your thoughts with us about 
healthcare coverage for rural America.
    Today, rural populations are more likely to be poorer, 
sicker, older, and have higher rates of uninsured compared with 
urban populations. Exacerbating these issues, rural Americans 
experience many difficulties in accessing healthcare services 
which leads to higher morbidity and mortality rates compared to 
those of their urban counterparts.
    Among the primary challenges rural communities face is a 
lack of adequate insurance coverage or even getting coverage at 
all. Nearly one-quarter of all adults in rural communities are 
uninsured, and nearly 60 percent of the rural uninsured are 
low-income families.
    Rural populations are less likely to have employer-
sponsored health insurance. Consequently, Medicaid is a 
critical lifeline for rural and underserved communities. This 
is why efforts to repeal the progress the Affordable Care Act 
has made to provide coverage to underserved and rural 
communities is so misguided.
    In addition, there is a shortage of doctors and hospitals 
in rural areas, and institutional barriers can make providing 
care in these areas especially challenging. These challenges 
not only result in poor health outcomes for people in rural 
communities but have significant implications for the local 
economy.
    I look forward to hearing testimony today about policies 
that can increase the number of physicians in underserved 
communities and leverage technological innovation to improve 
health access and quality. Policies that increase insurance 
coverage not only benefit patients but also create jobs in the 
healthcare sector, a sector that is overwhelmingly comprised of 
small businesses.
    In fact, it is estimated that, since 2012, 50,000 jobs were 
added to the healthcare sector as a direct result of the 
expansion of coverage under the Affordable Care Act. Despite 
this growth, there still remains a significant provider 
shortage in rural areas. Even with insurance coverage, many 
patients in rural areas struggle to find care, especially when 
it comes time to visit a specialist.
    The fact is made abundantly clear by the ongoing opioid 
epidemic currently plaguing our Nation. It's estimated that as 
many as 3 million people in the U.S. are suffering from opioid 
addiction related to prescription drugs and heroin. As opioid-
related deaths have gone up across the Nation, the largest 
increases are reported in heavily rural States. Our 
constituents and their families need help, but they often have 
no place to go. For example, 13 percent of rural communities 
have no behavioral health providers. Telehealth has the 
potential to bring high quality behavioral health services to 
these suffering communities.
    Indeed, studies have shown that video telehealth users have 
satisfaction levels and outcomes similar to those clients 
receiving in-person therapy. Although it is still in its early 
stages, telehealth is expanding at a rapid rate, and has 
potential to dramatically improve access to quality care in a 
number of areas. Telehealth also has the potential to draw more 
doctors into practice in rural settings, who would otherwise 
feel isolated, and can be used to connect specialists with 
community providers, allowing practitioners to join a virtual 
community where they can receive mentoring and grow 
professionally.
    Improving access to care in rural areas also benefits the 
local small business economy. There are over 1,500 rural 
hospitals nationwide that support nearly 2 million jobs. Every 
dollar spent by a rural hospital produces $2.29 of economic 
activities. When patients can receive care in their community, 
they do not need to travel to urban centers. They are able to 
keep their dollars within their own community and help to drive 
the success of local small firms. I look forward to hearing 
testimony today about how we can advance policies and leverage 
telehealth to improve access to quality healthcare for rural 
and underserved communities.
    With that, I say thank you, and I yield back.
    Chairman BLUM. Thank you, Mr. Schneider.
    I would now like to yield to the ranking member of the 
Subcommittee on Health and Technology, Mr. Lawson, for his 
opening statement.
    Mr. LAWSON. Thank you, Mr. Chairman, and welcome to the 
Committee.
    Nineteen percent of the U.S. population live in rural 
areas, as most of you know, yet only about 9 or 10 percent of 
physicians practice in rural areas. Rural populations have 
fewer hospitals and healthcare providers, particularly 
specialists, than any other urban counterparts. And patients 
often must travel long distances, as we heard earlier, to 
access care while primary care providers struggle to coordinate 
care with specialists.
    This not only has implications for doctors, clinics, and 
small hospitals, but for the local small business economy. 
However, innovations in technology are helping to alleviate the 
strain on small providers. Today's hearing will offer an 
opportunity to examine ways that we can improve access to 
healthcare in rural areas.
    Telehealth has the potential to advance healthcare quality 
by reducing costs. It can save patients time and money in 
traveling to see their doctors while also allowing small 
practices to broaden their scope. This also indirectly benefits 
local small business economy by keeping dollars in the 
community to make rural areas more attractive.
    I myself grew up in a rural area. And in recent years, 
innovations have made telehealth technology more accessible to 
rural providers than ever before. However, obstacles to its 
adoption remain. Some barriers are easy to overcome, such as 
educating doctors and patients about its utility. Other 
obstacles, such as a lack of broadband connectivity, are more 
challenging.
    I am pleased this hearing will provide the opportunity for 
us to examine not only the barriers to health faced by rural 
communities but how innovations in technology can improve them. 
I hope that this hearing will help us identify ways we can 
encourage greater adoption of telehealth and how improved 
access to care benefits small business economy. I want to thank 
our witnesses again who traveled here today for both their 
participation and insight into this important topic.
    With that, Mr. Chairman, I yield back.
    Chairman BLUM. Thank you, Mr. Lawson.
    If Committee members have an opening statement prepared, I 
ask that it be submitted for the record.
    I would like to take a moment to explain the timing lights 
to our panelists. You will each have 5 minutes to deliver your 
testimony. The light will start out as green. When you have 1 
minute remaining, the light will turn yellow. And, finally, at 
the end of your 5 minutes, it will turn red, and we ask that 
you try to adhere to that time limit to the extent possible.
    I would now like to formally introduce our witnesses today. 
Our first witness is Ms. Nikki Clowers, the managing director 
of the healthcare team at the U.S. Government Accountability 
Office, or better known as GAO. The healthcare team at GAO 
recently released a report entitled ``Telehealth and Remote 
Patient Monitoring Use in Medicare and Selected Federal 
Programs'' and surveyed a wide variety of stakeholders on the 
state of telehealth use in Federal health programs. Thank you 
for being here with us today.
    Our next witness is Ms. Barb Johnston, the chief executive 
officer and cofounder of HealthLinkNow in Sacramento, 
California. Ms. Johnston's company helps mental health 
providers incorporate telehealth services into their practices. 
Additionally, through a Centers for Medicare and Medicaid 
Services grant, her company integrated telehealth services into 
more than 80 primary care clinics in three rural States, 
Montana, Wyoming, and Washington. We appreciate your testimony 
and being here today.
    And I now yield to Mr. Kelly, a member of the full 
Committee, for the introduction of our next witness.
    Mr. KELLY. Thank you, Mr. Chairman.
    I would also like to just acknowledge that the chairman of 
the full Committee, Chairman Chabot, has joined us, and we 
thank him for being here on this important event.
    Thank you. I am proud to introduce Mr. Michael Adcock, the 
administrator of the Center for Telehealth at the University of 
Mississippi Medical Center, or UMMC. As executive director for 
UMMC Center for Telehealth, Michael is on the front lines of 
combating the severe doctor shortage that Mississippi faces. 
The UMCC Center for Telehealth is, in my opinion, the best in 
the country and leverages location within Mississippi's only 
teaching hospital to deliver high-quality care to rural 
patients that often lack access.
    Mr. Adcock, I am excited to have a great Mississippian here 
today, and I look forward to hearing your opening statement.
    Thank you, Mr. Chairman. I yield back.
    Chairman BLUM. Thank you, Mr. Kelly.
    I now yield to our ranking member, Mr. Schneider, for the 
introduction of our next witness.
    Mr. SCHNEIDER. I am going the yield to my colleague Mr. 
Lawson.
    Mr. LAWSON. Thank you, sir. Okay. I have the pleasure of 
introducing Dr. Schmitz, president of the National Rural Health 
Association, professor and chair in the Department of Family 
and Community Medicine at University of North Dakota School of 
Medicine and Health Sciences.
    Dr. Schmitz has spent nearly 20 years in rural practice and 
teaching residents and students in the area of medical 
education, rural health, and workforce research. He is an 
active in both the American Academy of Family Physicians, 
serving on the Commission on Quality and Practice, the Global 
Association of Family Physicians serving as the North American 
representative to the executive of the Group of Rural 
Practices. I welcome Dr. Schmitz.
    Chairman BLUM. Thank you, Mr. Lawson.
    I would like to now recognize Ms. Clowers for her 5-minute 
testimony.

STATEMENTS OF A. NICOLE CLOWERS, MANAGING DIRECTOR, HEALTH CARE 
     TEAM, UNITED STATES GOVERNMENT ACCOUNTABILITY OFFICE, 
 WASHINGTON, D.C.; BARB JOHNSTON, CHIEF EXECUTIVE OFFICER AND 
   COFOUNDER, HEALTHLINKNOW, SACRAMENTO, CALIFORNIA; MICHAEL 
  ADCOCK, ADMINISTRATOR, CENTER FOR TELEHEALTH, UNIVERSITY OF 
  MISSISSIPPI MEDICAL CENTER, JACKSON, MISSISSIPPI; AND DAVID 
 SCHMITZ, M.D., PRESIDENT, NATIONAL RURAL HEALTH ASSOCIATION, 
                        WASHINGTON, D.C.

                 STATEMENT OF A. NICOLE CLOWERS

    Ms. CLOWERS. Chairman Blum, Ranking Members Schneider and 
Lawson, Chairman Chabot, and members of the Subcommittee, thank 
you for inviting me here today to discuss our April 2017 report 
on telehealth.
    Access to healthcare services can be challenging for some 
people, such as those who live in remote areas. Telehealth can 
provide an alternative to healthcare provided in person or at a 
doctor's office--for example, by providing clinical care 
remotely through two-way video.
    In my comments today, I will cover three topics from our 
April report. One, the extent to which telehealth is used in 
Medicare and Medicaid; two, factors that affect the use of 
telehealth in Medicare; and, three, the different payment and 
delivery models that could affect the potential use of 
telehealth in Medicare.
    First, we found that Medicare providers used telehealth 
services for a small proportion of beneficiaries and relatively 
few services. For example, an analysis of Medicare claims data 
by the Medicare Payment Advisory Commission, or MedPAC, shows 
that less than 1 percent of all Medicare Part B fee-for-service 
beneficiaries accessed services using telehealth in 2014.
    According to MedPAC, beneficiaries using telehealth 
averaged about three telehealth visits in 2014, and Medicare 
spent about $14 million in total in telehealth services in that 
year. The most common telehealth visits were for evaluation and 
management services, followed by behavioral health services. 
MedPAC's analysis shows that 10 States accounted for almost 
half of all Medicare telehealth visits.
    For Medicaid, the use of telehealth varies by State, as 
individual States have the option to determine whether to cover 
telehealth and what types of telehealth services to cover, 
among other things. We reviewed six States to gauge the extent 
to which telehealth is used by Medicaid. We found that 
officials from States that were generally more rural than urban 
said they used telehealth more frequently than officials from 
more urban States.
    For example, Montana officials told us that they have used 
telehealth as a tool to help patients see both in-state and 
out-of-state specialists remotely, as there is a limited access 
to specialists in the State.
    In contrast, officials from Illinois, which contains more 
urban areas, told us that telehealth represented a very small 
portion of their Medicaid budget and was used primarily to 
provide behavioral health services.
    Second, stakeholders that we interviewed identified factors 
that encouraged the use of telehealth in Medicare, including 
the potential to improve or maintain quality of care, address 
provider shortages, and increase convenience to patients.
    For example, telehealth can increase convenience by 
shortening or eliminating travel times, which may lead to 
better adherence to recommended treatment and to patient 
satisfaction. However, these stakeholders also identified 
several potential barriers to the use of telehealth in 
Medicare, including payment and coverage restrictions.
    For example, officials from one provider association 
reported that Medicare's telehealth policies for payment and 
coverage, such as those restrictions that limit the geographic 
and practice settings in which beneficiaries may receive 
telehealth services, are more restrictive than the policies of 
other healthcare payers.
    Finally, as of April 2017, CMS was supporting eight models 
and demonstrations that have the potential to expand the use of 
telehealth in Medicare. For example, one demonstration aims to 
develop and test new models of integrated healthcare in 
sparsely populated rural areas. Under the demonstration, CMS 
allows participating providers to receive cost-based payment 
for telehealth when their location serves as the originating 
site, rather than the approximately $25 fixed fee that CMS 
otherwise pays originating sites.
    In summary, while the use of telehealth in select Federal 
programs is low, it remains an important alternative to 
providing healthcare services in person, especially for 
patients who cannot easily drive long distances for care.
    Chairman, ranking members, and members of the Subcommittee, 
this concludes my prepared remarks. I would be pleased to 
answer questions at the appropriate time.
    Chairman BLUM. Thank you Ms. Clowers.
    I now recognize Ms. Johnston for 5 minutes.

                   STATEMENT OF BARB JOHNSTON

    Ms. JOHNSTON. Thank you. Honorable Steve Chabot, Chairman 
Blum, and other members of the Subcommittee, my name is Barb 
Johnston as announced----
    Chairman BLUM. Can you move closer to the microphone or 
move it closer to you? Thank you.
    Ms. JOHNSTON. Does that work better? Okay. So sorry. I have 
been working in telemedicine for so long now I am thinking of 
lying. It has been over 20 years. It has been a labor of love. 
I have learned so much along the way. Today, I am here as a 
private citizen. I am doing that because I have been working in 
so many different areas, I wanted to cover lessons learned from 
so many of the opportunities I have had to work primarily 
serving people in rural areas.
    As mentioned before, the core problem for rural medicine is 
15 percent of the Americans who live there are only served by 
10 percent of the Nation's doctors. Telemedicine has been 
around for a long time. Some of you may not know that 
psychiatry, telepsychiatry has been practiced for 50 years, 
half a century.
    So far, there are some key things I wanted to share with 
you that have been demonstrated and that people have already 
mentioned, but I want to bring it up again. Telemedicine has 
shown and has massive capacity to keep rural dollars in rural 
communities. It supports rural primary care providers and 
clinics. It helps keep hospitals and clinics open. Without the 
support of specialists through these modalities that are so 
commonly used in our everyday life, such as using our cell 
phone, which is just a minicomputer or banking or education--
people in this country expect to be able to use technology to 
receive appropriate and high-quality care using telemedicine, 
and it is happening. It is happening all over the country. It 
is growing.
    It encourages recruitment and retention of the local 
doctors and providers who do serve physically in person in 
rural communities. Many, many studies, work that I have done, 
continues to show it does lower the overall cost of care. It 
can actually avoid small businesses closing. A person who owns 
a small business or a worker in a rural community who has to 
travel 3, 4 hours out site has to shut down that business that 
day. It costs them so much money and is so unnecessary. They 
lose wages, and the community may lose the barber shop, the 
only restaurant in town.
    It also helps support health IT workforces. Every program I 
have ever started has included people in rural communities 
learning to use these technologies, and one thing you all 
should know: Rural people are very smart. They catch on very 
quickly. They are brilliant at putting these things together.
    I think we all know that the cost of healthcare in this 
country is significant. It is growing. Telemedicine has the 
capacity to help resolve some of that financial burden. There 
are laws and regulations that could help significantly. I am 
identifying three that are crucial.
    Number one is the problem we have with the DEA rule related 
to a 2008 bit of legislation called the Ryan Haight Act that 
inadvertently prevents our doctors providing the medication 
that they need so that when a telemedicine service is provided, 
specifically it affects three groups: Opiate addicts who need 
the medication, the doctors are not allowed to do the 
prescription online. All the doctors that we work with use 
electronic health records. They can't provide the drugs that 
these opiate addicts need. Our veterans, and I have seen a lot 
of them, they cannot receive the basic medications they need 
for PTSD, traumatic brain syndrome, just because of an 
inadvertent inclusion in that DEA rule. That could and should 
be changed and corrected. Children with ADDH, they lose school 
days. They can't pass because they can't get the medication 
they need.
    One of the biggest problems we have had since Medicare 
instituted the rural requirement, this limits patients with 
Medicare who live in geographic locations that are defined by, 
in my opinion, very narrow rural designation; they can't 
receive Medicare services. Those constituents are getting more 
and more upset. They are seeing these things on TV. They know 
telemedicine exists. Medicaid doesn't have these rules, but 
Medicare does.
    And the last one is the complicated credentialing licensing 
problems.
    I see my time has run out. So I will leave where I am 
because I hit the key elements, and I am grateful, very honored 
to be allowed to present to you, and thank you so much for your 
consideration on this important topic.
    Chairman BLUM. Thank you, Ms. Johnston. We are grateful 
that you are here, as well.
    Mr. Adcock, you are recognized for 5 minutes for your 
testimony.

                  STATEMENT OF MICHAEL ADCOCK

    Mr. ADCOCK. Thank you. Chairman Chabot, Chairman Blum, 
Ranking Members Schneider and Lawson, and members of the Small 
Business Committee, thank you for the opportunity to appear 
today. I am Michael Adcock, Executive Director for the Center 
for Telehealth at the University of Mississippi Medical Center 
in Jackson, Mississippi. I am honored to talk with you this 
morning about telehealth and the ways its power can be 
harnessed to address the healthcare needs of America's small 
businesses.
    Mississippi has significant healthcare challenges, leading 
the Nation in heart disease, obesity, cardiovascular disease, 
and diabetes. These and other chronic conditions require 
consistent quality care, a task that is made harder by the 
rural nature of our State. In order to improve access to care 
and give Mississippians a better quality of life, it is clear 
that we need something more than traditional clinic and 
hospital-based services.
    Telehealth has been a part of the healthcare landscape in 
Mississippi for over 13 years, beginning with an aggressive 
program to address mortality in rural emergency departments. 
This program has had a significant impact not only in bringing 
quality care to the residents of these communities but in 
supporting the viability of the community hospitals themselves. 
In some cases, TelEmergency prevented hospital closures that 
would have been detrimental to these underserved communities.
    Today, the UMMC Center for Telehealth delivers care in over 
200 sites in 68 of our State's 82 counties and provides access 
to patients who might otherwise go untreated. Maximizing our 
utilization of healthcare resources through the use of 
technology is the only way that we can reach all of the 
Mississippians who need care.
    Small businesses account for 99.9 percent of all firms in 
the United States and often cite access to healthcare has their 
number one concern. Decreasing absenteeism, increasing 
productivity, and improving access to high-quality care are 
concerns to small businesses owners and were the drivers behind 
the creation of our eCorporate program at UMMC. This program 
allows employees to access high-quality care from their 
workplace through secure audiovisual connections, avoiding 
travel to seek medical care and promoting appropriate use of 
healthcare resources at a lower cost.
    Several corporations have chosen to pay for this service 
for their employees and allow paid time during the workday to 
use the service, further reducing barriers to healthcare.
    Should an employee have a need outside the scope of 
telehealth, UMMC assists in securing appropriate followup with 
local providers. The eCorporate program currently covers more 
than 4,000 employees and dependents statewide. We offer 
wellness services and diabetes prevention management services 
for corporations, as well.
    Another program that has been very impactful for patients 
is remote patient monitoring, which supports patients as they 
manage these chronic diseases in their home. RPM is designed to 
educate, engage, and empower patients so they can take care of 
themselves. Our initial pilot with diabetics in the Mississippi 
Delta was a public-private partnership to test the 
effectiveness of remote patient monitoring using technology in 
rural, underserved areas.
    The preliminary results showed a marked decrease in blood 
glucose, early recognition of diabetes-related eye disease, 
reduced travel to see specialists, and, most remarkably, no 
diabetes-related hospitalizations or emergency room visits 
among our patients.
    The Mississippi Division of Medicaid extrapolated this data 
to show a potential savings of $180 million per year if 20 
percent of the diabetics in Mississippi on Mississippi Medicaid 
participated in the program. Given the success of this diabetes 
pilot, UMMC Center for Telehealth has expanded remote patient 
monitoring statewide.
    Healthcare is a major economic driver across the United 
States, and this has already been discussed. In Mississippi, 
hospitals boast over 60,000 full-time employees and create an 
additional 34,000 jobs outside of their facilities. For every 
new physician creates approximately 21 jobs and more than $2 
million in revenue for our community. For every three jobs 
created by a hospital, an additional job is created by other 
businesses in the local economy.
    Our telehealth program directly supports the financial 
viability of the healthcare system, especially primary care 
providers' offices, small rural hospitals, and rural healthcare 
clinics. Keeping services in the communities not only supports 
the local providers but keeps much needed employment and 
revenue in the rural communities.
    Businesses in Mississippi that have utilized our telehealth 
and remote patient monitoring programs have seen improved 
access to care, decreased healthcare costs, and improved 
quality of care for their employees. Healthy employees mean 
decreased absenteeism, increased productivity, and a greater 
chance for small businesses to remain viable.
    Thank you all for your time and attention to this very 
important matter.
    Chairman BLUM. Thank you, Mr. Adcock.
    And for some reason, you are a little easier to understand 
than my good colleague and friend, Mr. Kelly from Mississippi. 
So we appreciate that.
    Dr. Schmitz, you are now recognized for 5 minutes.

                STATEMENT OF DAVID SCHMITZ, M.D.

    Dr. SCHMITZ. Good morning, Mr. Chairman, ranking members, 
and members of the Subcommittee. Thank you for inviting me here 
to testify. My name is David Schmitz, and I am a family 
physician who has practiced and taught in rural America for 
more than 20 years. I am here today representing the National 
Rural Health Association where I currently serve as president, 
and I am grateful to have this opportunity to discuss rural 
healthcare and its impact on rural America and local economies.
    For 62 million Americans living in rural and remote 
communities, access to quality and affordable healthcare is a 
major concern. Rural Americans on average are older, sicker, 
and poorer than their urban counterparts, as we have heard. 
They are also more likely to suffer from chronic diseases that 
require ongoing monitoring and follow up care. Local care is 
necessary to ensure patient ability to adhere to the treatment 
plans to help reduce the overall cost of care and to improve 
patient outcomes and their quality of life.
    Whether following the delivery of a healthy baby or 
significant loss of function due to stroke, local integrated 
care for rural people in their own support systems is not only 
the right care; it is better care.
    Rural communities are resourceful, and the continuity of 
care is primary to good outcomes, such as avoidance of hospital 
readmissions. Investing dollars locally can save what would 
otherwise be wasted dollars lost to inefficiencies, anonymity, 
and the gaps that occur in the miles between.
    There is no doubt that rural healthcare delivery is 
challenging. Workforce shortages, older and poorer patient 
populations, geographic barriers, low patient volumes, and high 
rates of publically insured Medicare and Medicaid recipients, 
uninsured and underinsured populations are just a few of the 
barriers.
    Unfortunately, a growing number of rural Americans are 
living in areas with limited healthcare options. Indeed, 81 
rural hospitals have closed since 2010, leaving many rural 
Americans without timely access to emergency care. Two of the 
most recent of these, closing on June 30 of this year, were in 
Florida and Texas.
    As noted in my written testimony, health disparities 
between rural populations and their urban counterparts are 
pronounced, and this can be particularly true among the growing 
minority populations in rural America. Rural healthcare 
providers are not only critically important for health of rural 
Americans, they are also critically important for economic 
health of rural communities. While many industries in rural 
America have been shrinking, healthcare is an industry with the 
potential to reverse declining employment. As factory and 
farming jobs have declined, the local rural hospital often 
becomes the hub of the local business community, not only 
offering critical lifesaving services, but representing as much 
as 20 percent of the rural economy. Simply put, hospitals 
provide a large number of jobs.
    The average critical access hospital creates 195 jobs, 
generates $8.4 million in payroll annually, and rural hospitals 
are often the largest or second largest employer in a rural 
community, along with the school system. This was true in the 
community I practiced in of 2,303 people for 6 years.
    In addition, a single rural primary care physician, again 
as we heard, can generate as many as 23 jobs and more than a 
million dollars in annual wages, salaries, and benefits. In my 
own personal experience, rural communities are both resourceful 
and resilient. As referenced in my written testimony, training 
doctors and other health professionals close to home makes it 
more likely that they will call that place home.
    In order for this to occur, we must have technology across 
a rural distributed campus, per se, training our workforce to 
meet the needs of rural communities and at the same time 
providing economic investment in those rural places.
    Graduate medical education or residency training regulatory 
reform, allowing for education of physicians in rural 
hospitals, is one example of how to address rural economic 
development and workforce shortages in one action while 
improving quality of care and delivering cost-saving 
healthcare.
    Technology. Technology, such as telemedicine for 
consultation services have supported rural delivery of care but 
depend on adequate development of broadband internet into rural 
and remote areas. Still hands-on care is needed when an 
unexpected car accident or early delivery of a premature baby 
occurs in rural America. No matter if you are a local resident 
or simply visiting, each one of us who will spend our time and 
dollars in rural communities, and at those times, will 
appreciate quality local care in those moments.
    In addition to these lifesaving measures, healthcare is one 
industry capable of playing a critical role in supporting the 
local economy and protecting rural communities from further 
economic damage. If roads and internet access are the blood 
vessels and the nerves, then, in my opinion, healthcare is the 
backbone for investing in rural America.
    Thank you again for the invitation to speak and to 
accompany my written testimony as submitted.
    Chairman BLUM. Thank you, Dr. Schmitz.
    I now yield to the chairman of the Subcommittee on Health 
and Technology, Ms. Radewagen, for her opening statement.
    Chairwoman RADEWAGEN. Thank you, Mr. Chairman.
    I want to apologize for being a little bit late. I was on 
the Senate side testifying on behalf of the Secretary Zinke's 
Assistant Secretary for Insular Areas, which is our areas.
    So, talofa. Good morning. Thank you, Chairman Blum, and 
thank you all for testifying today. Good morning to Chairman 
Chabot, as well. It is an honor to chair the Subcommittee on 
Health and Technology, and I look forward to learning more 
today about how both health and technology can benefit small 
businesses and rural communities.
    According to recent data from the Kaiser Family Foundation, 
American Samoa is facing tremendous shortages of primarily 
healthcare professionals and is currently only meeting around 
10 percent of need in terms of the number of physicians 
available to serve the population. The Samoan Islands have 
among the highest rates of obesity and type 2 diabetes in the 
world, with one-third of American Samoans suffering from 
diabetes.
    If medical treatment is unavailable on the island, 
patients, including many VA beneficiaries, generally have to 
fly nearly 3,000 miles to Hawaii to see a specialist. Recently 
CMS granted a waiver that will allow Medicaid patients to go to 
New Zealand instead. That has been helpful.
    I am very interested in hearing and learning more about 
strategies for increasing the use of telehealth in rural and 
remote areas, like American Samoa, where provider shortages are 
severe. I also look forward to hearing more about how 
telehealth could attract more new or current physicians to 
locate their practices in rural areas, like American Samoa, 
where the tropical scenery, rain forests, beaches, and reefs 
are second to none.
    I want to thank all the witnesses for being here today, and 
I yield back my time to Chairman Blum.
    Chairman BLUM. Thank you, Ms. Radewagen, and thank you for 
that commercial at the end. We agree with you.
    I now recognize myself for 5 minutes of questions. I love 
this topic. I think, you know, the increase in costs in 
healthcare in our country are not due to one large thing or two 
large things. I think, and pardon the pun, it is death by a 
thousand cuts. The increased costs are because of a thousand 
smaller things, and I also think the solution is not one silver 
bullet to solving increased access and decreased costs while 
keeping our quality high. There is not one silver bullet. I 
think it is a thousand smaller things, if you will. I 
absolutely believe one of those things smaller things is 
telemedicine.
    I would like--this is for the whole panel--ideas of where--
the Federal Government is the largest purchaser of healthcare 
in the country, obviously. I would like to hear from you places 
the Federal Government can increase the outcomes, the quality 
of the outcomes, increase access, decrease costs by utilizing 
telemedicine that we are not doing today. Give me two or three 
great examples of here's where we can save money and increase--
improve the outcomes for patients. Anyone?
    Dr. Schmitz.
    Dr. SCHMITZ. Thank you, Mr. Chairman.
    Just a couple of brief examples. One is you have heard the 
use of Tele-Emergency medicine. Again, how can you develop a 
relationship between a, for example, family physician and a 
critical access hospital; being able to be simultaneously 
supported both in their practice, which retains them, and also 
lowering the barrier to recruiting to rural areas. At the same 
time the transfer, if necessary, is expedited with high quality 
care.
    Another example is tele-ICU or intensive care unit, 
consultation, allowing again, patients to stay in place, when 
possible. A third example is something called Project ECHO, 
which is a learning group where you can have essentially 
development of teams across the spectrum disease, including 
opioids, to be able to develop better practices across the 
country. And my final and fourth would be, again, the use of 
technology in telemedicine in distributed medical education and 
health professions education, training people as close to home 
as possible.
    Chairman BLUM. So these items you just mentioned, Doctor, 
are not being done today?
    Dr. SCHMITZ. To a certain extent they are, but there are 
also opportunities with regard to reimbursement mechanisms and 
regulatory mechanisms that would allow this to be expanded, 
particularly into rural areas. One example I mentioned was 
graduate medical education funding and residency funding 
reform, allowing again, more cost-based reimbursement or more 
support of these both workforce initiatives as well as 
healthcare delivery mechanisms.
    Chairman BLUM. Thank you.
    Are there others?
    Ms. Johnston?
    Ms. JOHNSTON. Thank you. I think the market has the 
potential to drive expansion massively if the handcuffs could 
come off, and I mean that in reference to my earlier remark, 
the limitation of the location of a patient being rural or not 
rural. It actually doesn't make any sense to me. It doesn't 
make sense to constituents when you have a neighbor who has 
Medicaid and they can see a doctor, and their next-door 
neighbor has Medicare and they can't, and that conversation is 
growing. I am hearing--I am an active member of the American 
Telemedicine Association, so I hear it from my colleagues all 
over the country. If that one thing could get corrected, I 
think the market would drive expansion, and it would help 
business in this country.
    The other place is in skilled nursing facilities. Skilled 
nursing facilities primarily are caring for our elderly, some 
disabled, and in those facilities, almost all of the ones that 
we have approached even when I was in the position of having 
millions of dollars to fund programs, which I did, I couldn't 
get one nursing home to accept starting a program for fear that 
there would be an incorrect billing and they would be doing 
fraud, or because they would have some of their clients not 
being able to access care, and they didn't want to look like 
they were preferentiating one group over another.
    Chairman BLUM. Mr. Adcock?
    Mr. ADCOCK. Yeah, another area that is not currently being 
paid for through Medicare, not being reimbursed with Medicare, 
is remote patient monitoring, so chronic disease management in 
patients' homes. As we know, Medicare recipients often struggle 
from many chronic diseases, not just one, but diabetes, heart 
disease, and that is something we can impact through remote 
patient monitoring. Right now, there is not a payment mechanism 
for remote patient monitoring through Medicare.
    Chairman BLUM. Do you feel this would actually save the 
government money or improve the outcome?
    Mr. ADCOCK. Absolutely. Yes. I mean, similar to what we 
have done in Mississippi with Medicaid, I definitely--Medicaid, 
obviously, in Mississippi, is funded by Federal and State 
dollars. There is a tremendous savings just in diabetes. So, 
yes, we are performing this service in congestive heart 
failure, hypertension, asthma, COPD. There are many different 
chronic modalities that are costing a lot of money, and a lot 
of our healthcare resources that can be taken care of in the 
home through technology.
    Chairman BLUM. Thank you.
    And now my time has expired, and I now recognize the 
ranking member, Mr. Schneider, for 5 minutes.
    Mr. SCHNEIDER. Thank you, Chairman Blum.
    And thanks again to the witnesses for being here and 
sharing your perspective.
    Ms. Johnston, I just want to say you should not be hiding 
the fact that you have been working this area for so long, but 
wearing it as a badge of honor because it is critical.
    And I will also say you mentioned that we've been doing 
telehealth in psychiatry for 50 years. One of the things that 
struck me is that the phone was patented--and I had to look it 
up--the phone was patented in 1876. As we have new 
technologies, I don't want to wait 100 years or 90 years to 
start using them again.
    Much of the conversation is often around telehealth filling 
gaps. If--for rural communities, there are gaps in care. Mr. 
Adcock, I think as you were talking about what you are doing in 
Mississippi, it's creating opportunities to improve healthcare, 
improve its efficiencies, lower its costs, and have better 
outcomes. And I hope, over the course of time, we can move our 
conversation from filling the gaps to really finding ways to 
use telehealth to make a difference. I think the rural 
communities and the small businesses, as you discussed, provide 
that great opportunity. So I will get off my soap box, but I 
did want to just emphasize that.
    Dr. Schmitz, you said you've been in this area for a long 
time. We hear about the shortage of doctors for so long. 
Earlier this year, I was privileged to introduce the 
reauthorization of the Conrad 30 program, which would bring 
doctors from other countries into our rural communities helping 
to fill that gap again. But I would be curious from your 
experience, if you have seen that program and other programs of 
graduate medical education to support doctors coming into where 
the need is the greatest, share your thoughts, please.
    Dr. SCHMITZ. Thank you, Ranking Member Schneider. I 
appreciate the opportunity to answer. We have seen benefits. 
There is no doubt about the need that we have, from a provider 
workforce standpoint, in rural America. And I think programs as 
such you have mentioned have been an important opportunity to 
be able to serve those needs.
    I actually have done research looking at the recruitment of 
rural providers into both several States here in the United 
States as well as comparing that to other countries, such as in 
Australia, and I think as we look at a global need with regard 
to, as you said, not only beginning to have an adequate 
workforce in place, but really have a healthcare team that 
provides the most efficient and effective care to people, that 
the advent of technology has really changed the dynamic. Not 
only do we see doctors who still do house calls, but we also 
see physicians and really healthcare teams that can deliver 
everything from occupational therapy to dietician services and, 
most critically, mental health services locally as a team 
through use of technology and local providers. It is still 
about the relationship, isn't it, between the patient and the 
provider, between a couple of neighbors in a small town, that 
really I think to a certain extent impacts the quality of care 
and some of that efficiency, but supporting those providers as 
teammates and the use of technology has really changed the 
dynamic. And I think the example of health monitoring, where 
patients are empowered to be able to then access local 
healthcare and subspecialty care as needed, can change the 
fabric of what that appears to be. That will draw graduates 
from all over the world, I think, to appreciate what it means 
to be part of a rural community and a provider in those 
communities.
    Mr. SCHNEIDER. Great. Thank you.
    Mr. Adcock, you talked about your program, and I just want 
to clarify that I heard it right. Emergency diabetes check-ins 
went to zero in the program, you said?
    Mr. ADCOCK. That is correct. The first--of the members of 
the study, they had zero ER visits, zero hospitalizations for 
the first 6 months of the program.
    Mr. SCHNEIDER. That is extraordinary.
    Mr. ADCOCK. It is.
    Mr. SCHNEIDER. Are there things that you identify that were 
critical to that? Are there barriers to taking a program like 
this across the country?
    Mr. ADCOCK. I think that the critical barrier--I mean, the 
critical success factors were the fact that we didn't just 
monitor. There are a lot of monitoring programs. Even though we 
call our program remote patient monitoring, we actually engage 
with the patient and provide them education. So I think 
providers--all the providers I have talked to would agree that, 
if they had the opportunity to educate their patients in small 
bits every single day and check on them and provide real-time 
intervention, they would, but that is not realistic.
    So that is something we can deliver through technology. So 
that is where they benefitted was learning about their disease 
process. Diabetes, while it is not complicated to me or some of 
the providers, it is complicated to someone who is newly 
diagnosed and doesn't understand what they should eat, what 
they shouldn't eat, when they should exercise, how much water 
they should drink. So, when you can provide that education in a 
home daily in small, bite-sized pieces, it is extremely 
beneficial to them. And, also, when they slip or when they make 
a mistake and they eat the pecan pie, which we often do, when 
they check their blood sugar, we know it, and we are able to 
intervene immediately instead of waiting 3 months for the next 
in-person visit.
    So I think it is that relationship and the engagement and 
the empowerment; teaching them to take care of themselves was 
the big success factor.
    Mr. SCHNEIDER. Thank you.
    And I am out of time. I just want to add one more comment. 
Ms. Clowers, thank you for the testimony, but the discussion 
around the different pilots that you all are doing to take 
those pilots where there are successes and getting it out, if 
there is anything we can do to help, please look to us.
    And, with that, I yield back. Thank you.
    Chairman BLUM. Thank you, Mr. Schneider.
    And I will recognize the gentleman from Mississippi, Mr. 
Kelly, who is also our chairman of the Subcommittee on 
Investigations, Oversight, and Regulations for 5 minutes.
    Mr. KELLY. Thank you, Mr. Chairman.
    And, Mr. Adcock, it is nice to have someone here who does 
not have an accent.
    Mr. ADCOCK. It took a lot of practice.
    Mr. KELLY. How does Medicare's definition of rural area--
and I know Ms. Johnston talked about this to--present challenge 
for providers wishing to incorporate telehealth into their 
practices, and specifically I know, in Union County, because 
one little area is so many miles from a four-way, they don't 
qualify, but from a four-lane highway, but people don't 
understand: Driving distance and miles are different, 
especially in rural areas. So, if you can do that, Ms. 
Johnston, after him, if you would like to follow up, I would 
really appreciate that.
    Mr. ADCOCK. We talk a lot about rural versus urban settings 
and rural designations. What we see in telehealth, and 
Mississippi is certainly rural, and we have a lot of rural 
areas. We also have urban areas that don't qualify for as a CMS 
service. So I would like to steer the conversation away from 
geography. The fact is we have healthcare resource shortages, 
and it doesn't matter. I can tell you a specific example. 
Dermatology in Mississippi, it takes 6 months to get a 
dermatology appointment in Mississippi. It doesn't matter if 
you live right next to the University of Mississippi Medical 
Center or if you live 180 miles away. Geography doesn't matter 
in that case.
    So it is more to me about healthcare resource shortages and 
being able to address those. Those don't always happen exactly 
the certain distance from a four-lane highway; they happen all 
over the place. So being able to lose that geographic 
restriction would be great, if we could lessen that or get rid 
of it all together, because the fact is access to care isn't 
just about urban versus rural. It is about whether or not there 
is a resource available and how a patient can access that 
resource.
    Mr. KELLY. Ms. Johnston, briefly.
    Ms. JOHNSTON. Thank you. Let me give you two quick 
examples. Number one, a small town in Wyoming where they have a 
huge backlog, patients needed to see a psychiatrist. They 
absolutely refused to allow us to provide telepsych, an entire 
program paid for, because they were so afraid of complications 
with not billing correctly. That is just one example.
    Second example, we have been recently approached to provide 
telepsychiatry services to Puerto Rico. They identified six 
clinics. They gave us the addresses. We went online because 
there is a site under CMS to make sure that you are allowed to 
do it because they require that the Medicare also be seen. Not 
one clinic across Puerto Rico was considered to be meeting that 
definition. The program cannot go forward. I have been to 
Puerto Rico. I have driven all over it. I still can't find a 
nonrural area.
    Mr. KELLY. And that being said, you know, Mr. Adcock, I 
want to ask this question, but I think it is important: It is 
more economy driven than it is rural or urban. There are a lot 
of inner city areas that have the exact same issues that rural 
areas have. They have the exact same travel distance or 
challenges that a rural area would have, and I think it becomes 
about people who are a lot of times impoverished, who don't eat 
well, and who are not educated in what those diseases are, and 
are a long distance in time or access from medical, and I think 
we owe it to them to get medical access and I think telehealth 
can do that. That being said, Mr. Adcock, what are the benefits 
of small businesses offering telehealth in the workplace?
    Mr. ADCOCK. I think, again, it is access. It allows access 
for employees who may not have access to healthcare otherwise. 
Also, it forms that relationship. Once they start seeing a 
provider, and we are able to refer them to a local primary care 
physician, it completes that relationship. And the earlier they 
can get access to care, the more likely they are to recognize a 
disease, whether it be prediabetes, whether it is diabetes, 
hypertension, it could be, you know, eye disease, any other 
disease. So early access is important. And limiting those 
barriers.
    So a lot of employees are main providers for their home. 
They are not able to take off half day to go to a physician's 
office, and they may have to drive 40, 50 miles to the 
physician's office, wait in the waiting room, be seen, and they 
have missed half a day of work, they have to pay their copay, 
they will just be sick. And employees who aren't well aren't 
productive. It is not good for the small business. So being 
able to decrease absenteeism, increase productivity is 
extremely important for those small businesses and could mean 
the difference between keeping them viable or not.
    Mr. KELLY. And just in closing, Mr. Chairman, I will just 
say telehealth is the wave of the future. We know preventative 
medicine is one of the primary cost-saving benefits that we get 
in America, and using technology to get that is a no-brainer to 
make sure that we use this and maximize this for small 
businesses and for our medical care.
    Thank you, and I yield back.
    Chairman BLUM. Well said. Thank you, Mr. Kelly.
    And I now recognize the gentleman from Florida, Mr. Lawson, 
who is also the ranking member on the Subcommittee on Health 
and Technology for 5 minutes.
    Mr. LAWSON. Thank you.
    Dr. Schmitz, rural America includes approximately 57 
million people and about 20 percent of the population. There 
are 1,855 rural hospitals that support nearly 2 million jobs. 
How does improved access to care in rural areas benefit the 
local economy?
    Dr. SCHMITZ. Thank you, Congressman.
    You are exactly right that, again, the testimony that I 
provided in writing and accompanying here with you is that 
local hospitals are a driver of the local economy, not only 
directly with regard to employment of physicians that results 
in economic stimulus and further jobs, but also, with regard to 
keeping the opportunity for growing other businesses local.
    Again, I have had experience in North Dakota but also now 
20 years of experience in Idaho, and I can remember times when, 
during difficult fiscal discussions, we talked about roads and 
we talked about healthcare and we talked about education 
because we knew that would bring industry to our small towns. 
That was an economic driver in itself but also built, again, a 
framework upon which we could see economic growth.
    So I would commend the opportunity to speak with you and 
agree on the fact that rural hospitals, and at this point, in 
particular in time, saving rural hospitals, recognizing not 
only their cost effectiveness to quality care but also the fact 
that they are an economic driver in our Nation is a timely 
discuss. Thank you.
    Mr. LAWSON. Okay. Thank you.
    And, Doctor, I am going to ask you this question simply 
because I was involved in it. In 2000, we in the legislature in 
Florida authorized a medical school at Florida State, and a key 
factor in authorizing that medical school is that they were 
going to train physicians to go into rural areas because other 
people might want to comment on that. So that has been 17 years 
later, but what I understand, and a lot of these students once 
they finish, because of tremendous loans and stuff in medical 
school, they want to go into the cities where they can make a 
little bit more money to take care of medical loans. Have you 
seen in medical schools, has this philosophy changed, and have 
we worked out anything to cause them to go into rural areas?
    Dr. SCHMITZ. Thank you, Congressman. That has been the 
study of my last 10 or 15 years since leaving rural practice 
myself but staying in contact with rural medicine as a medical 
educator. I think you are right that we have found that 
intentional public accountability with regard to medical 
education is key, and training in interprofessional health 
teams is also important.
    One of the things that I have seen is that we train to have 
people remain. I could say being from the country from the 
sticks, training in the sticks' sticks. And one of the things 
that we have found is that, with studies we have actually done, 
including rural training track residency education, where we 
actually have physicians training during their residency in 
rural places such as critical access hospitals have a higher 
likelihood that those physicians will remain in rural and 
underserved communities.
    So I think those sorts of investments and the opportunities 
to look at regulatory relief or funding and then encouraging 
again our medical schools to have these sorts of tracks for 
rural providers shows that there is the evidence, is that, 
where they train, they are more likely to remain. This 
accompanied by loan repayment opportunities, both at the 
Federal and State level, and mentoring--frankly, mentoring of 
physicians, so that they can see themselves there, especially 
now in the advent of the utilization of technology where now we 
can see our patients are supported to be self-empowered around 
their disease conditions. But, frankly, I think that I can tell 
you, as a 29-year-old doctor in an ER, it is a little bit 
scary, and you want to do the best you can, and you know you 
will do the best you can, but having an opportunity to have 
that consultation and mentoring, not only in person and in 
practice with your partners but also through telehealth, makes 
a powerful statement to our young students.
    Mr. LAWSON. My time has almost expired, but, Ms. Johnston, 
since you have been at it for a very long time, do you see any 
difference of it really working in the training in medical 
schools, a physician to go right in the rural areas?
    Ms. JOHNSTON. I think one of the strategies that we have 
done in the State of California, I served on the board of 
trustees for the Health Education Foundation, and what that 
sought to do, and it has been very effective, we provide loan 
repayment for primarily physicians but other healthcare workers 
who will serve in rural areas. That has been the most 
successful thing we have ever done, because some of these 
students get out, they owe $150,000, and to get them to go work 
in a rural area where their income is going to be so much lower 
than in the urban area, this was a huge incentive. And it has 
been a very effective program. And we found that, if they stay 
in the rural community for 2, 3, 4, 5 years, much higher 
percent that they will stay there.
    Mr. LAWSON. Okay.
    And I yield back, Mr. Chairman.
    Chairman BLUM. Ms. Clowers, did you want to add on to that 
quickly?
    Ms. CLOWERS. Thank you. I just wanted to add that we did 
work issued early this spring where we looked at graduate 
medical education funding, and most of the funding is still 
going to urban areas, and that is important, as Dr. Schmitz 
said, because where people train, they tend to stay. And also 
what we found is that the Federal efforts to increase graduate 
medical education in rural areas is limited, and really that 
funding is driven by statute. So I just wanted to add that for 
the Subcommittee.
    Chairman BLUM. Thank you.
    Thank you, Mr. Lawson.
    The gentleman from Kentucky, Mr. Comer, is recognized for 5 
minutes.
    Mr. COMER. Thank you, Mr. Chairman.
    I have a question for anyone on the panel. Just out of 
curiosity. I assume you all kept track of both the House 
healthcare bill and the Senate healthcare bill. And I am 
curious, did either of those bills affect telehealth in any way 
either positively negatively or no impact whatsoever? Anybody 
know?
    Mr. ADCOCK. I don't have any idea.
    Ms. JOHNSTON. No.
    Mr. COMER. What about a complete repeal? That is something 
that is obviously being batted around now in the Senate and in 
the House. Would a complete repeal have any impact on 
telehealth, a complete repeal? Anybody know?
    Ms. JOHNSTON. I can only imagine that, if millions of 
Americans lose their health insurance, it is going to have an 
impact on this Nation. And it for sure is going to impact 
anywhere healthcare is provided.
    Mr. COMER. But there is no specific part that you can think 
of that would have a--I mean, you just assume that?
    Ms. JOHNSTON. I would agree with that. Probably the best 
source to get that specific answer would be through the 
American Telemedicine Association. They have staff that are 
specifically looking at this. And we can follow up and get that 
information to you from the ATA.
    Mr. COMER. I certainly support telehealth. Being in a rural 
part of Kentucky, it is very challenging for our hospitals to 
get physicians. And this is very important. And we want to 
certainly support that. And, hopefully, we can work together 
and fix our broken healthcare system. There are parts of 
healthcare that are working. There are parts that I think need 
to be radically changed. The cost of healthcare is a big issue 
that doesn't seem to be getting a lot of attention now. It is 
all about health insurance. But, hopefully, we can come to a 
solution and look forward to staying in contact with you all as 
we try to fix our broken healthcare system. And, certainly, for 
those of us that represent rural areas, telehealth is a very, 
very important part that I want to support, and I am sure 
everyone on this Subcommittee does as well.
    Thank you, Mr. Chairman.
    Chairman BLUM. Thank you, Mr. Comer.
    The gentleman from Kansas, Dr. Marshall, is now recognized 
for 5 minutes.
    Mr. MARSHALL. Thank you so much, Mr. Chairman. A great 
topic, something I am pretty familiar with.
    I think, first of all, always talking about success 
stories. Colby, Kansas, Citizens Hospital. Part of the stroke 
collaborative program that Dr. Bobby Moser has piloted in 
Kansas, one of the greatest success stories I have ever seen, 
very dependent upon telemedicine. A person has an acute onset 
of a stroke. And if we can get that thrombolytic agent within 
30 minutes--we talked about cost savings, so much about cost 
savings. The true cost savings that this makes is in the 
healthcare dollars that we are not going to spend. This stroke 
person that we prevented this stroke from becoming permanent, 
we just have saved hundreds of thousands of dollars of hospital 
bills, rehabilitation bills, and then a person that is maybe on 
a disability the rest of their life.
    So that is the beauty of this. We could talk about strokes. 
We could talk about acute MIs, again, using that thrombolytic 
agent. And what people don't understand is these agents have 
very significant side effects. And it takes a lot of courage to 
give this drug. And if you don't give it on a regular basis, 
you just don't give it, especially not in time. The nurses drag 
their feet. So Colby, Kansas, is hooked up 24/7 to another 
busy, busy ER, and a nurse can take the patient's symptoms. And 
while the nurse practitioner is scrambling to get over there, 
walks into the room, and everything is already set up and 
going. They have got a protocol set. We are getting the CAT 
Scan, and within 30 minutes, we can give that drug. And it is 
night and day.
    Another great success story in Kansas is the Kansas 
Enhanced Veterans Service Program. It is a mobile office that 
goes across the State. Twenty-two veterans die from suicide 
every day in this country. Those veterans are not going to come 
to the veterans hospital, both of them, that we have in Kansas. 
So we are taking the program to them. They are using 
telemedicine to touch base with their psychiatrist, their 
psychologist, their social workers back home, making sure they 
get their medicines. Absolutely a success story.
    My thoughts would be is that government will not solve this 
problem but, rather, innovation will continue to solve the 
problem. And Medicaid or Medicare is typically in the way of 
solving the problem. So I just would just continue to look for 
success stories and then try to, not reinvent the wheel, but 
keep accentuating those.
    So I would ask for anyone, what are the most--I shared my 
success stories. We can't use a shotgun and try to use 
telemedicine for everything. But it has some great 
opportunities in the emergency room, and I think the 
psychology/psychiatry as well.
    So does anyone have a great success story they want to 
share? Dr. Schmitz, you have one?
    Dr. SCHMITZ. Thank you, Congressman. Again, I would just 
share a success story around tele-ICU. And what that is, 
essentially, is in, again, a critical access hospital that 
otherwise can provide appropriate care--I have certainly been 
in a situation where we were, frankly, weathered in. We were 
concerned about the safety of having a helicopter land in our 
town because of snow or other conditions, also similarly 
concerned, what would a patient be able to do with regard to 
ground transport for safety? In my town, there were 104 curves 
in a 19-mile piece of road on the way out to the urban center. 
So I think you are exactly right.
    And one thing we can look at is, how do we have 
consultation through telemedicine with, for example, patients 
who may or may need to be transferred the next morning and 
oftentimes actually don't need to be transferred? Again, 
providing not only quality care, access to care, but in a 
fairly common scenario better care, and likely empower that 
team.
    Mr. MARSHALL. I have been in that same position so many 
times with a 25-week baby, 600-gram baby, fogged in, snowed in, 
and scrambling to try to fix that problem. I can certainly 
deliver that baby, but the problem was taking care of the baby 
afterwards.
    Any other great success stories that you have?
    Ms. Johnston, go ahead.
    Ms. JOHNSTON. I was PI on the Patient-Centered Medical Home 
Project. That was a program funded through CMS' CMMI innovation 
initiative. And during the 2 years--3 years that we ran it, 
2012 to 2015, we showed significant cost effectiveness. Just as 
one example, NIH, their numbers for outpatient for mental 
health patients annually averages about $1,557. Ours came out 
to $390. Patient satisfaction, over 90 percent. It was huge.
    Mr. MARSHALL. So I got 20 seconds. Where is telemedicine 
not working? Can you give me examples, anybody, where there is 
an area of medicine that it hasn't worked very well?
    Ms. JOHNSTON. No.
    Mr. MARSHALL. Yes, sir.
    Dr. SCHMITZ. I do think we need to continue to coordinate 
care so patients have primary care access, and electronic 
medical records that are able to integrate patients' global 
care.
    Mr. MARSHALL. Thank you.
    Chairman BLUM. Thank you, Dr. Marshall.
    The gentleman from Nebraska, Mr. Bacon, is now recognized 
for 5 minutes.
    Mr. BACON. Thank you very much to all four of you. We have 
got votes coming up. So I will just get right to the questions. 
I appreciate you being here.
    First of all, a couple of you mentioned the definition for 
rural areas hurt telehealth. Is that a regulation or a law? 
What do we need to change, specifically, to fix this?
    Ms. CLOWERS. For Medicare, it is defined by statute.
    Mr. BACON. Okay. So it is on us to make that change then?
    Ms. CLOWERS. Correct.
    Mr. BACON. Okay.
    Ms. CLOWERS. And what it requires is, it requires both in 
terms of restrictions on the facilities as well as the 
location. So certain facilities are allowed, in Medicare, to be 
an originating site.
    Mr. BACON. Right.
    Ms. CLOWERS. As well as, it has to be located in an area 
that has been defined by HHS as being a health professional 
shortage area or outside of a metropolitan area.
    Mr. BACON. So that is a task for us to work on then. We 
will take that on.
    Second question, Ms. Clowers, you mentioned the VA using a 
lot more telehealth. Can you talk a little more about that? 
Because I know we have a big long line of people trying to get 
care, and this is one way to help.
    Ms. CLOWERS. Right. VA, what we found is that 12 percent of 
beneficiaries in 2016 were provided telehealth visits, which is 
much greater than what we saw in Medicare. And, in fact, what 
we also found was that they have over 50 different types of 
specialties or services that are eligible for telehealth, and 
they have less restrictions than in Medicare. So, for example, 
the program does allow for the patient to be at home for 
telehealth visits.
    Mr. BACON. That is great news.
    Here is one for any of you all. Who are the opponents to 
doing this? Are there industries out there or institutions that 
are fighting us? Go ahead. Please.
    Ms. JOHNSTON. I think the world of telemedicine has 
appropriately been challenged by a lot of really important 
agencies, the American Medical Association used to be really 
concerned. I think the concerns all stem from people wanting to 
make sure that we are doing this correctly, that we are 
providing quality care. Whenever we get challenged, it is never 
from somebody who is just saying no. It is just because they 
need to be educated and reassured that anybody who's using 
these technologies is meeting, if not exceeding, the quality of 
care that people deserve.
    Mr. BACON. One last question. It seems that some illnesses 
are tailor-made for this, but others may be a little more 
challenging. So what is the percentage, would you say, roughly, 
that this is--telehealth is perfect for? But there is other 
things--sometimes you got to lay eyes on the infection or--you 
know what I am saying? There are some things a little more 
challenging that the doctor has to actually see it, perhaps, or 
take blood or something. I don't know. What do you think the 
percentages are?
    Dr. SCHMITZ. Congressman, thank you for that important 
question.
    I think, first of all--and I think in response to the other 
question about the pending decisions that will come up around 
healthcare and access is in that rural America, we need to have 
people who can deliver healthcare and places where it can be 
delivered. So we look at rural health clinics, federally 
qualified health centers, private practices, and critical 
access hospitals as examples. We still need the providers 
there. If it is an automobile accident and a chest tube is 
required for a collapsed lung, we still need the providers 
there. I see telemedicine more to support those services, as 
well as to augment them.
    And in some ways, telepsychiatry mental health, we have 
even seen where patients will be more likely to see a 
telehealth provider in an adjunct room of the critical access 
hospital as opposed to sometimes driving down the street a 
block. I don't know what the future holds. But I don't see one 
necessarily replacing the other. They really come together.
    Mr. BACON. Well, thank you very much.
    I yield back.
    Chairman BLUM. Thank you, Mr. Bacon.
    As has been mentioned previously, votes have been called. 
So this is a very important topic. And we have some members 
here that still haven't had a chance to ask their questions. So 
we will stand in recess until after the votes, and then we will 
reconvene.
    We shall stand in recess.
    [Recess.]
    Mr. LUETKEMEYER. [Presiding.] Okay. We will gavel our 
Committee back into session. And thank all of the witnesses for 
continuing to stick around. I apologize for the delay, but we 
did have to do a little bit of what we are here to do a while 
ago, which is go vote on some very important legislation to 
certain people, areas of our country.
    I am Congressman Luetkemeyer. I am from Missouri. I am the 
vice chair of the entire Committee. And Chairman Blum has other 
duties to attend to for the moment. So you are stuck with me to 
take us out the gate here.
    So, with that, let us continue on with the discussion we 
are having, and we will recognize Miss Gonzalez for 5 minutes.
    Miss GONZALEZ-COLON. Thank you, Mr. Chairman.
    And thank you, the whole panel, for staying here so long.
    Over the last 5 years, over 3,000 physicians have left 
Puerto Rico. And, currently, the island loses one doctor per 
day, as you may know. Hospitals and medical practice groups are 
finding it very difficult to recruit specialist physicians and 
experts. We are trying to have some kind of telehealth by 
medical specialists located in the U.S.-based academy medical 
centers, maybe can be a great opportunity for the island, 
especially in rural areas that are a hundred percent of the 
island, maybe 90 percent. Are there any impediments to 
telehealth payment arrangement when the patient is located at 
their home in Puerto Rico or at a medical facility in Puerto 
Rico and the doctor is located at a medical center located on 
the mainland? Ms. Johnston?
    Ms. JOHNSTON. Hi. It is Barb Johnston. Many. And it is 
problematic. As I mentioned, we have been approached, the 
company I currently work for. We have the doctors. They want to 
work. They have doctors locally that want to learn how to do 
this locally in Puerto Rico. And we are more than happy to do 
it. The sticking point is getting payment for doing it. As I 
said before, Medicare's rule that restricts to their definition 
of rural for telemedicine completely blows the whole project. 
It prevents us from being able to do that. If there could be 
some kind of a waiver, or if we could be allowed to pilot, or 
whoever is going to be able to provide the care--because it 
won't just be telepsych, which is what we do. There are others. 
But that is the desperate need that we have heard from people 
in Puerto Rico. So if they could do that.
    The other is getting a waiver to allow patients to be seen 
in their home. There are many parts of Puerto Rico where--and 
we have been told--that people don't have transportation. Even 
if there was some, they can't. And, like, the Veterans 
Administration in this country has been doing this for 10 years 
successfully, seeing patients directly at home.
    Miss GONZALEZ-COLON. Quick question. That waiver, it is 
going to be for the Federal Government or Federal--do we have 
to amend any Federal laws, or we are talking about State laws?
    Ms. JOHNSTON. I might----
    Miss GONZALEZ-COLON. I defer to Ms. Clowers.
    Ms. CLOWERS. The requirement is through statute. So the 
statute defines in Medicare where the services can be provided. 
And as Ms. Johnston said, it has to be--the originating site 
must be in an area that has been designated as a health 
professional shortage area or outside of a metropolitan area.
    Miss GONZALEZ-COLON. In our case, I mean, the shortage is 
there. Actually, we are having the same problems in the VA 
facilities, the same as the American Samoa, where we don't even 
have the specialists in so many areas in the VA hospital. And 
we have tried to recruit them, but it is so difficult. Because 
nobody wants to leave the mainland to go to Puerto Rico or even 
remote areas to just move their families to attend the patients 
there. And I would like to know if you can provide, the whole 
panel, specifically what kind of amendments do we need to make 
to change that statute? If you can provide--I mean, I know that 
we--in 1 minute, you can't provide that. But if you can provide 
that to the Committee later on, that will help us a lot to 
identify those statutes with the correct language so we don't 
mess--mess with the whole situation.
    Ms. CLOWERS. And, Representative, I would like to add, too, 
that in addition to a potential statute change, CMS, through 
their innovation center, has different models and 
demonstrations that they can run. And they have the ability to 
waive certain requirements. And so they would have the ability 
to have a demonstration and waive these rural requirements.
    Miss GONZALEZ-COLON. I know.
    Ms. CLOWERS. If that would be something that you would be 
interested----
    Miss GONZALEZ-COLON. I know. We are working with them 
directly and we are trying to change the State plan. And even 
doing that, we are still facing the same problems. That is 
happening in Puerto Rico. That is happening in other States. So 
this is not an issue just for--but we are facing--in our case, 
in the islands, you can't cross the State line. You can't take 
a car or even take a train. You have to take a plane or a boat 
to take the service, and that is not enough. So that was the 
question. Since my time is running, is there any--can you 
provide any information about the security of the patients' 
records on telehealth or how secure and private these records 
are when telehealth is employed?
    Ms. JOHNSTON. The way that most of us work--and I will 
speak to the company I currently work for. We use a fully 
HIPAA-compliant system end to end. We use a product called 
athenahealth. I have no investment in it, don't own it. It is 
just a completely secure and HIPAA-compliant system. Anything 
that we use technologywise, the videoconferencing, the health 
records, any communication--you can't text. There is very 
strict--we actually are the only telepsych company in the 
country that is Joint Commission accredited. That is just part 
of it. But, yeah, end to end.
    Mr. ADCOCK. Same thing. Ours is encrypted and all HIPAA 
compliant. Everything that we use goes into our electronic 
medical record, Epic. So it is all controlled just as it would 
be if you came in person.
    Miss GONZALEZ-COLON. Thank you.
    I yield back. Thank you, Mr. Chairman.
    Mr. LUETKEMEYER. The gentlelady's time has expired.
    Next we go to Representative Radewagen, from American 
Samoa. She is the Chairman of the Subcommittee on Health and 
Technology. You are recognized for 5 minutes.
    Chairwoman RADEWAGEN. Thank you, Mr. Chairman.
    Ms. Clowers, American Samoa could greatly benefit from 
using health for patients to access medical care remotely 
without leaving the islands. We talked about it a bit today. 
However, broadband access is not sufficient. Are there Federal 
programs available to assist remote areas like American Samoa 
to support broadband for telehealth?
    Ms. CLOWERS. Yes, ma'am, there are. And you are correct, 
broadband is a challenge, and it is something that we heard in 
our work when we surveyed people about the barriers to using 
telehealth, the infrastructure that is required to successfully 
carry out telehealth. Broadband was identified as one of those 
infrastructure challenges. And there are grants that are 
available for different communities through different 
departments.
    And, for example, the USDA has grants. And American Samoa 
has received a grant, I believe in the amount of $820,000, for 
support in this area. And we would be happy to get you more 
information on that grant, if you are interested.
    Chairwoman RADEWAGEN. Thank you.
    Mr. Adcock, what are some important innovations in 
telehealth that you have experienced while working in this 
field? And what innovations may we expect in the future as more 
American consumers demand telehealth services?
    Mr. ADCOCK. Thank you very much. I think the innovations 
that we--I am going to go to the second part of the question 
first. The innovations that are coming in the future, I 
couldn't begin to tell you. There are so many different 
wearables and sensors and things that are coming out now, that 
are being innovated now, that I can't imagine what the future 
is going to look like from that standpoint.
    But I think where we focus on technology is that we wrap 
technology around our clinical programs. I think that our 
focus--while technology is certainly important, I think our 
focus is around the patient and what we need to do to provide 
excellent clinical care to the patients, and then we use the 
appropriate technology around that. But being able to deliver 
care into a home to monitor diabetes so that patients don't 
have to plug anything in or try to transcribe their outcomes or 
their results themselves, I think that, just in the last couple 
of years, has come so very far. And being able to Bluetooth 
into these devices and use cellular technology to connect to 
patients and providers has come so very far in the last couple 
of years. Where it is going, I would honestly be scared to say. 
But I think that the focus needs to remain on making sure that 
providers and patients, not necessarily in that order, but 
patients and providers are the center of what we are doing with 
telehealth. This should be an extension of healthcare. This 
should be something that is used to help better healthcare 
services that can be delivered at home.
    Ms. Johnston, would you care to answer that question?
    Ms. JOHNSTON. I completely agree. At the American 
Telemedicine Association annual conference this last year, 
Thomas Friedman spoke, keynote, and that is really what he was 
echoing. He stood on a stage and said: Right now, with 10,000 
people in this audience, there is a couple of guys in a garage 
in Silicon Valley, and they are ahead of us. We just need to 
catch up with them.
    I think it is going to be part of it.
    I think, too, the current president of the American 
Telemedicine Association, he has been putting forward and doing 
a lot of speaking about hybrid healthcare in a model that he 
sees more and more individual providers and health systems 
where they see some patients on telemedicine, use remote 
monitoring, and some in person. And that is happening quite a 
bit. It is spreading across major hospitals and health systems 
across the country. Thank you.
    Mr. Chairman, I yield back.
    Chairman LEUTKEMEYER. I understand the lady from Samoa has 
a closing statement. You can go ahead and do that.
    Chairwoman RADEWAGEN. Thank you, Mr. Chairman.
    Well, let me take this opportunity to thank all of the 
witnesses for their testimony today. As the chairman of the 
Subcommittee on Health and Technology, it is extremely valuable 
to hear how telehealth is helping physicians expand the 
services they offer and is offering patients more convenient 
options to access the healthcare they need.
    American Samoa is facing tremendous provider shortages, and 
telehealth services could keep our residents and their families 
from traveling long distances to receive care or going without 
the care they need. This could also benefit other small 
businesses by keeping dollars in the community. I was also 
pleased to learn that there is hope that telehealth will make 
rural areas more viable locations for physicians to operate 
their practices. Technology has improved many aspects of daily 
life, and it can potentially improve healthcare access as well.
    [Speaking foreign language.]
    Thank you. And I yield back to Chairman Luetkemeyer.
    Mr. LUETKEMEYER. I am glad you interpreted that for us. 
Thank you very much.
    I will defer my questions to the end. I think Miss Gonzalez 
has got a second round question here.
    So let's go to Miss Gonzalez. You are recognized for 5 
minutes.
    Miss GONZALEZ-COLON. Thank you, Mr. Chairman. I really 
appreciate that deference. I will be short. I will just leave 
you with some questions I got.
    And one is regarding Mr. Kelly, in his statement here, 
identified the issues regarding rural areas. And one of the 
concerns regarding Mississippi was the diabetes situation. And 
your experience treating patients with diabetes and using 
telehealth, how do they--those patients were improving. Do you 
have seen a decrease in the hospitalizations and emergency room 
visits in Mississippi? That is one of the questions, because we 
got the same situation in the island, and other situations 
regarding heart diseases, among others. That would be one of 
the questions. I don't want to abuse from the chairman. That 
will be one of the questions.
    The second one is going to be in terms of is there a need 
for a certification requirement when telehealth providers are 
located in a jurisdiction other than where the medical provider 
is located? What of those requirements, if they are from a CMS, 
or HHS, or whatever they are, if the State is involved in that, 
and how difficult are those regulations to comply with? And in 
terms of having--is there any copayment to the patient if they 
are using health in terms of the veterans, if they are using 
this kind of program? I don't know. That is going to be one of 
the questions.
    Mr. ADCOCK. I will take the first question around remote 
patient monitoring. And thank you for asking that followup 
question. Yes. In our diabetes pilot that we did in the 
Mississippi Delta, we saw significant results in the 
preliminary results. And the final results will be out later 
this month. But we saw a decrease in hemoglobin A1c, which is 
the measurement of blood sugar over time. We also saw a 
complete elimination of ER visits and hospitalizations for 
those patients that were on our program. So, not only did they 
just reduce their visits to the ER, we did not have any 
diabetes-related ER visits or hospitalizations.
    Miss GONZALEZ-COLON. Zero?
    Mr. ADCOCK. Zero. Not saying that that would be sustained 
over a huge population. But we have seen very similar results 
in our--the final results are very much mirroring that. And the 
results that we see with our population that is on that program 
outside of the pilot have had significant results in 
readmissions and hospitalizations. So that is one of the points 
of the program. But I think the reasons for that are because of 
the education that we provide and the real-time interventions. 
So we teach them about their disease so that they can take care 
of the disease themselves. You can't expect them to go to a 
provider every time something is going on. That is not 
realistic. It is not realistic for the provider. It is not 
realistic for the patient. So being able to teach them about 
their disease and then teach them as they are having issues so, 
if their blood sugar goes up, you are able to intervene at that 
time and say: This is why your blood sugar went up. This is 
what you can do to prevent it in the future. A lot of these ER 
visits aren't due to medical emergencies every time. A lot of 
times they are due to fear. They don't know what to do when 
this happens. So being able to educate them in real time has 
been a real success. And we have spread that program statewide.
    Miss GONZALEZ-COLON. Mr. Schmitz.
    Dr. SCHMITZ. Thank you, Congresswoman. I would just like to 
agree with that testimony and just give a quick example. If we 
look, for example, as a primary care provider, a family 
physician, per se, at the patient-centered medical home having 
a dashboard where information comes in, you can literally have, 
you know, green, yellow, red where people who are knowledgeable 
about this data can then, for example, use what is called open-
access scheduling and decide who gets an acute care visit open 
slot with that provider, be it a physician assistant, 
physician, or otherwise, and avoid, again, that lack of 
information that otherwise might result in an ER encounter with 
someone who does not know them as well.
    Miss GONZALEZ-COLON. Thank you.
    Ms. Johnston or Ms. Clowers?
    Ms. CLOWERS. To your second question about other challenges 
with licensing, when we spoke to different stakeholders through 
our work, we did hear that licensing was a challenge. And an 
example of that is when you are at the distant site--if you are 
a provider at the distant site, you also have to be licensed in 
the State that the patient resides. And that can be challenging 
for different providers. And that is driven by State law.
    Miss GONZALEZ-COLON. Thank you. You want to add something, 
Ms. Johnston?
    Ms. JOHNSTON. I was just going to answer--I think you asked 
a question about a copayment for telemedicine?
    Miss GONZALEZ-COLON. Yes. Is there----
    Ms. JOHNSTON. I have never actually heard of that. I don't 
have any experience with that.
    Miss GONZALEZ-COLON. Okay.
    Ms. JOHNSTON. We have never done anything like that.
    Miss GONZALEZ-COLON. Okay. Thank you.
    With that, I will yield back.
    Thank you, Mr. Chairman.
    And thank you, all the members of the panel.
    Mr. LUETKEMEYER. The Gentlelady's time has expired.
    With that, I just want to follow up with a few things.
    And I know that, Ms. Clowers, you were talking about some 
of the payment and coverage restrictions that cause problems 
sometimes. I think it was Ms. Johnston mentioned some of the 
things that happened and can be done or changed with regards to 
the locations qualifying. But with regards to payment and 
coverage restrictions, can CMS do this right now through their 
rulemaking process, or does that take legislation?
    Ms. CLOWERS. The coverage issue would require legislation. 
It is defined by statute.
    Mr. LUETKEMEYER. Okay.
    Ms. CLOWERS. They do have flexibilities in their 
innovations center where they are able to test different 
approaches with different models and demonstrations. So that 
would be an area that they could explore with a model.
    Mr. LUETKEMEYER. Okay. Some of the things you talked about, 
do you have studies that show how much it saves?
    Ms. CLOWERS. We do not. When we did our work in looking at 
the different opportunities, both benefits of telehealth, we 
were looking at CBO scores which showed--it is hard to tell 
sometimes in terms of the cost savings. It depends on how 
telehealth is used. If it is used to replace an in-person 
visit, that can result in savings. But if it is used in 
addition to an in-person visit, that can increase cost. So that 
is what we found in terms of the cost savings. But I know other 
witnesses here at the table have other experiences.
    Mr. LUETKEMEYER. Yeah. I think, Mr. Adcock, you were 
talking about your in-home monitoring programs. And did you put 
an analysis on that and see how much you actually saved with 
the pilot project you are talking about?
    Mr. ADCOCK. So the pilot project, again, was a public/
private partnership. But our division of Medicaid actually took 
the data on the actual cost savings of those first 100 
patients, first 6 months, and extrapolated that to say that, if 
20 percent of the Medicaid patients in Mississippi who were 
diabetic were on the program, we would save $180 million a 
year. So, yes, there are cost----
    Mr. LUETKEMEYER. Your State would save that much?
    Mr. ADCOCK. Yes. Yes. Medicaid would save that much so 
federal and state together--
    Mr. LUETKEMEYER. The State Medicaid program would save $180 
million----
    Mr. ADCOCK. Correct.
    Mr. LUETKEMEYER.--a year just on that one----
    Mr. ADCOCK. Just diabetics, just 20 percent. So now we are 
doing hypertension and heart failure and all the other chronic 
diseases we are monitoring as well. So we will continue to do 
cost analysis on those programs. We have legislation in 
Mississippi that allows us to get paid for remote patient 
monitoring. So there is a fee to it, and we do receive payment. 
The cost savings are tremendous.
    Mr. LUETKEMEYER. Okay. And you mentioned a couple other 
things that you are working on with your more remote abilities 
here. And that was heart monitoring and what else?
    Mr. ADCOCK. Heart failure. So congestive heart failure. 
Hypertension. That is adult and pediatric diabetes. We are 
working on asthma and chronic obstructive pulmonary disease. 
All of these are high-cost items. We also monitor--this is 
outside of the reimbursement legislation in Mississippi. We 
also monitor bone marrow transplant and kidney transplant 
patients so that we can get them out of the hospital sooner and 
get them back home.
    Mr. LUETKEMEYER. The hearing today was with regards to 
rural telehealth. But, I mean, telehealth is something that 
they can utilize--people can utilize every day everywhere else 
too, many urban areas, suburban areas. I mean, this isn't 
something confined. But what we are talking about here is the 
importance of how it helps the quality of life, basically, for 
folks in rural areas.
    And so, Dr. Schmitz, would you like to add anything to the 
discussion with regards to other opportunities and the cost 
savings? Have you done any studies or are aware of any of that?
    Dr. SCHMITZ. I really appreciate the opportunity, 
Congressman. One example, I think, that hasn't been brought up 
is the provision of chemotherapy, for example. As you can 
imagine, in a rural critical access hospital that is quite 
remote from subspecialty care, supporting a local physician/
nurse team, for example, to administer chemotherapy in the same 
quality really does prevent patients who otherwise would have 
very uncomfortable transport--not only long transport, but 
uncomfortable transport, during the treatment of their disease.
    Mr. LUETKEMEYER. Okay. So what we are doing is trying to 
find ways to improve the quality of health and health services 
in rural areas. And the things you are suggesting, is anybody 
putting this into a bill that you are aware of or just 
discussed it with you to help work on this?
    Yes, sir, Dr. Schmitz.
    Dr. SCHMITZ. I would be happy to follow up with National 
Rural Health Association how telemedicine and teletechnologies 
can be incorporated into better care----
    Mr. LUETKEMEYER. Because the comment a minute ago was that 
some of it has to be done legislatively; some of it can be done 
through the rulemaking process. I think we have a friend with 
Dr. Price at HHS now who is willing to look at options, look at 
different things, different ways to deliver care, deliver 
services, upgrade and innovate. But by the same token, if we 
need to do something legislatively, I think that is where we 
need to go.
    Mr. Adcock.
    Mr. ADCOCK. The CONNECT for Health Act that is out right 
now addresses a lot of these issues.
    Mr. LUETKEMEYER. Okay.
    Mr. ADCOCK. It addresses the geography issues, addresses a 
lot of the reimbursement issues. So that is something that we 
fully support and would love to see some more input on that.
    Mr. LUETKEMEYER. Very good.
    Yeah. Ms. Johnston?
    Ms. JOHNSTON. I just want to second that that legislation 
is bipartisan, the CONNECT for Health. It would address most of 
these things.
    Another comment I would like to make, in the CMS grant that 
we were given, 2012-2015, we submitted a final report that 
showed significant cost savings. Happy to provide that to the 
Committee. The VA every year produces very good data on cost 
savings. And the American Telemedicine Association is currently 
collating data on multiple studies across the country on cost 
savings.
    Mr. LUETKEMEYER. Does the VA coordinate with--I guess it is 
CMS with regards to telehealth stuff? I mean, your veterans are 
scattered all over the place. I mean, and they network back, 
usually, to a VA facility of some sort. Does that help them or 
hurt them with access to care? Are you familiar with that?
    Ms. JOHNSTON. I don't know that the VA works in any 
capacity with CMS. But I know that they are the largest 
provider of telemedicine in this country and have been. Nobody 
is even close to what they have been doing, and they keep 
proving every year how cost effective it is every year for our 
veterans.
    Mr. LUETKEMEYER. Okay. Very good. I am at the end of my 
questions. Would you all just like to have a closing question 
or comment or go ahead and say goodbye? Tired of listening to 
us?
    Yeah. Dr. Schmitz.
    Dr. SCHMITZ. Congressman, I would be just happy to first be 
the one to say thank you for the opportunity to speak about the 
important matters in rural health. I do think that we are 
seeing technology both to change access as well as quality of 
care and as we continue to see this again, as our panelists 
discussed, as a wraparound, person-to-person services, I think 
we will have better care for it. The example with the VA, for 
example, CBOCs, and how CBOCs can actually be co-located with 
other provider of services and co-supported through technology 
might just be one more example. So, again, Congressman, thank 
you for this opportunity.
    Mr. LUETKEMEYER. Mr. Adcock.
    Mr. ADCOCK. I would like to echo that. Thank you for the 
opportunity to come and talk about this important subject. 
Thank you for your interest and your very thoughtful questions. 
I do think that telemedicine is a way that we can spread access 
and improve quality across not just the United States but 
across the world, certainly across everything that the United 
States encompasses. So I think that is extremely important. And 
I thank you for your questions and for the time to speak.
    Mr. LUETKEMEYER. It is also great to know not everybody in 
Mississippi talks like Mr. Kelly.
    Ms. Johnston, closing comment?
    Ms. JOHNSTON. I just want to echo what has been said. But 
also just from myself thank you for what you do every day for 
Americans.
    Mr. LUETKEMEYER. Thank you.
    Ms. Clowers.
    Ms. CLOWERS. Thank you for having us. And at GAO, we are 
happy to stand ready to help with any further discussions on 
this topic.
    Mr. LUETKEMEYER. Very good.
    With that, again, I want to thank everybody for being here. 
As we heard, telehealth has the ability to connect a patient in 
a rural area to high-quality medical care at another location. 
This not only benefits the patients and their families but also 
may help the local physician to expand his or her small 
business. Other small businesses will benefit from dollars 
staying in the community. Additionally, we have heard that the 
availability of telehealth may attract new or current 
physicians to locate practices in rural communities and also 
how telehealth can benefit small employers and employees by 
offering convenient access to medical care and monitoring. In 
fact, I would think it would be an attractive way to attract 
doctors to the rural area if they know they can do it with 
telehealth and be--the quality of life is--coming from a town 
of 300 people--it is a whole lot better than it is in the city. 
So, therefore, why not move to the country, right? But with 
consumer demand growing for more convenient and efficient 
options to access healthcare, I hope that we are able to sort 
out some of the barriers our witnesses have testified about so 
that small businesses and rural communities have all the tools 
they need to thrive and keep residents well.
    Well, with that, I ask unanimous consent that members have 
5 legislative days to submit statements and supporting 
materials for the record.
    Without objection, so ordered.
    We are adjourned.
    [Whereupon, at 12:34 p.m., the Subcommittees were 
adjourned.]




                            A P P E N D I X


[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]



    Testimony of Michael P. Adcock
    Executive Director, Center for Telehealth
    University of Mississippi Medical Center

    House Small Business Committee
    Subcommittee on Agriculture, Energy, and Trade
    Subcommittee on Health and Technology
    July 20, 2017

    Chairman Blum, Chairman Radewagen, Ranking Member 
Schneider, Ranking Member Espaillat, and Members of the Small 
Business Committee, thank you for the opportunity to appear 
before the subcommittees today. I am Michael Adcock, Executive 
Director for the Center for Telehealth at the University of 
Mississippi Medical Center (UMMC) in Jackson, Mississippi. I am 
honored to talk to you this morning about telehealth and the 
ways its power can be harnessed to address the healthcare needs 
of America's small businesses.

    Mississippi has significant healthcare challenges, leading 
the nation in heart disease, obesity, cardiovascular disease 
and diabetes. These and other chronic conditions require 
consistent, quality care--a task that is made harder by the 
rural nature of our state. In order to improve access to care 
and give Mississippians a better quality of life, it is clear 
we need something more than traditional, clinic and hospital-
based services.

    Telehealth has been a part of the healthcare landscape in 
Mississippi for over 13 years, beginning with an aggressive 
program to address mortality in rural emergency departments. In 
2003, three rural sites were chosen to participate in a program 
that would allow UMMC board certified emergency medicine 
physicians to interact with and care for patients in small, 
rural emergency rooms via a live, two way, audio-video 
connection. The TelEmergency program has grown to serve more 
than 20 hospitals and continues to produce outcomes on par with 
that of our Level 1 trauma center. This program has had a 
significant impact, not only in bringing quality care to the 
residents of the community, but in supporting the viability of 
the community hospitals themselves. As a result of 
TelEmergency, rural hospitals are able to identify and recruit 
healthcare professionals who live in the community and desire 
to work locally. The program helps communities retain 
healthcare revenue that was lost as a result of patients being 
transferred out for care. In some cases, Telemergency prevented 
hospital closures that would been detrimental to these 
underserved communities. The success of this program and 
noteworthy outcomes led to the development of additional 
healthcare models using technology to address needs statewide.

    Today, the UMMC Center for Telehealth delivers more than 30 
medical specialties in over 200 sites across the state 
including rural clinics, schools, prisons and corporations. It 
is important to note that a very small portion of these sites 
are actual UMMC sites. As every community has different needs, 
we partner with local providers to address their specific 
needs. UMMC is committed to supporting the community providers 
through collaborative models that promote efficient use of 
vulnerable resources. The depth and breadth of our statewide 
network allows us to deliver world-class care in 68 of our 
state's 82 counties and provides access for patients who might 
otherwise go untreated. Over the last decade, we have conducted 
over 500,000 patient encounters through telehealth. Maximizing 
our utilization of healthcare resources through the use of 
technology is the only way we can reach all of the 
Mississippians who need lifesaving health care.

    Small businesses account for 99.9% of all firms in the 
United States and 96.2% of all Mississippi businesses. The one 
year survival rate for small businesses averages 78.5%. 
Approximately half of these establishments survive five years. 
In Mississippi, the small business exit rate is higher than the 
startup rate. Small businesses often site access to affordable 
healthcare as their number one concern. According to the 
Gallup-Healthways Well-Being Index, annual costs for local 
productivity for employees having chronic conditions totaled 
$84 billion. Multiple publications site that unschedule 
absenteeism costs roughly $3,600 per year for each hourly 
worker and $2,650 for each salaried employee. These factors 
lead to over $250 billion in lost economic output per year in 
the United States.\1\
---------------------------------------------------------------------------
    \1\ U.S. Small Business Administration, Office of Advocacy

    Decreasing absenteeism, increasing productivity and 
improving access to high quality care were the drivers behind 
the creation of the eCorporate and eSchool Health programs at 
UMMC. The eCorporate service allows employees to access high 
quality care from their workplace through secure audio/visual 
connections. This program is employee initiated and avoids 
travel to seek medical care, promotes appropriate use of 
healthcare resources and is a lower cost alternative to the 
---------------------------------------------------------------------------
higher cost healthcare settings.

    UMMC's eCorporate program is unique in that it is not 
designed to be a standalone means for primary care, but as an 
additional avenue for employees to access safe healthcare in an 
affordable and convenient manner. In many cases, this program 
has helped identify healthcare needs that, if gone untreated, 
would have resulted in increased healthcare burden and loss of 
productivity. For this reason, several corporations have chosen 
to pay for this service for their employees and allow paid time 
during the workday to use the service, further reducing 
barriers to health care. Healthcare is a collaborative effort, 
and this program is no different. Should an employee have a 
need outside the scope of telehealth, UMMC assists in securing 
appropriate follow up with local providers. The goal is to 
refer locally and support the local community when possible. 
The eCorporate program currently covers more than 4,000 
employees and dependents in businesses across Mississippi We 
have customers with as few as 15 employees. When you add our 
program for State Employees (UMMC 2 You), we cover over 185,000 
lives across our state.

    Our corporate offerings are not only aimed at patient 
initiated services. We currently offer wellness services and 
diabetes prevention/management services for corporations across 
Mississippi. We are working with some businesses to augment 
their current wellness services by helping to risk stratify 
their employees' annual lab work and biometric measurements. 
This leads to proactive visits with our providers to discuss 
risk factors and wellness. The goal is to educate these 
employees on healthy living and how they can address their risk 
factors to live a healthier life.

    Similarly, the eSchool Health program provides the school 
nurse with additional provider support needed to reduce 
absenteeism and improve student performance. With very few 
local primary care providers, nurses and parents have 
difficulty ensuring that students will have access to basic, 
and sometimes vital health services. With eSchool Health, 
school districts partner with UMMC to provide a more 
comprehensive health care offering that can assist with health 
care related needs such as asthma action plans and medication 
refills. Our eCorporate and eSchool Health programs are 
examples of working with community leaders to create an 
environment that is attractive to business by supporting 
efforts to produce healthy families.

    Another program that has been very impactful for patients 
is remote patient monitoring (RPM), which supports patients as 
they manage chronic disease in their homes. RPM is designed to 
educate, engage and empower patients so that they can learn to 
take care of themselves. Our initial pilot with diabetics in 
the Mississippi Delta was a public/private partnership between 
critical access hospital North Sunflower Medical Center, 
telecommunications provider C Spire, technology partner Care 
Innovations, the Mississippi Division of Medicaid, Office of 
the Governor of Mississippi and UMMC. The purpose of the pilot 
was to test the effectiveness of remote patient monitoring 
using technology in a rural, underserved area. Specifically, 
the desired outcome was to reduce Hemoglobin A1C by 1% in 
uncontrolled diabetics. The participants in this study received 
their healthcare in the local and rural health clinic. UMMC 
supported these providers by delivering diabetic education, 
monitoring biometrics and serving as a liaison between the 
patient and their provider as they learn to manage their 
condition. The preliminary results through six months of the 
study showed: a marked decrease in blood glucose, early 
recognition of diabetes-related eye disease, reduced travel to 
see specialists and no diabetes-related hospitalizations or 
emergency room visits among our patients. This pilot 
demonstrated a savings of over $300,000 in the first 100 
patients over six months. The Mississippi Division of Medicaid 
extrapolated this data to show potential savings of over $180 
million per year if 20 percent of the diabetics on Mississippi 
Medicaid participated in this program.

    Given the success of the diabetes pilot, UMMC Center for 
Telehealth has expanded remote patient monitoring to other 
disease states, including adult and pediatric diabetes, 
congestive health failure, hypertension, bone marrow transplant 
and kidney transplant. Working closely with a patient's primary 
care provider, we continue to grow this program both in terms 
of volume and number of diseases that can be managed. Most 
importantly, this program is giving patients the knowledge and 
tools they need to improve their health and manage their 
chronic disease. Businesses that are a part of our eCorporate 
program are also given the option to provide this service to 
their high risk employees with chronic disease. The employers 
see this as a way to offer their employees additional support 
and to reduce costs incurred for after hour clinic visits and 
emergency room visits for non-emergent conditions. Many small 
businesses are self-insured, so a program of this type provides 
quality care at an affordable rate is attractive and 
beneficial.

    Health care is a major economic driver across the United 
States, with the sector growing at over 20% annually. In 
Mississippi, hospitals boast over 60,000 full time employees 
and create an additional 34,000 outside of their facilities. 
Every new physician crates approximately 21 jobs and more than 
$2,000,000 in revenue for a community \2\. Critical Access 
Hospitals (CAH) are located in small, rural communities and are 
an important part of the health system. They are responsible on 
average for 170 jobs with $7.1 million in wages salaries and 
benefits. For every job in a hospital, an additional .34 jobs 
are created in other businesses in the local economy. This 
means that the average CAH is responsible for an additional 43 
jobs outside of the hospital and $1.8 million of taxable retail 
sales \3\.
---------------------------------------------------------------------------
    \2\ Critical Care, The Economic Impact of Hospitals on 
Mississippi's Economy, 2012
    \3\ Economic Impact of a Critical Access Hospital on a Rural 
Community Gerald A. Doeksen, Cheryl F. St. Clair, and Fred C. Eilrich, 
National Center for Rural Health Works

    Our telehealth program directly supports the financial 
viability of the health care system, especially primary care 
providers' offices, small rural hospitals and rural health 
clinics. Supporting these small businesses also supports the 
overall financial viability of the community. Collaboration 
between the Center for Telehealth and providers throughout the 
state allow for the delivery of high quality specialty care in 
locations that are convenient for patients. These 
collaborations deliver multiple benefits: access to specialty 
care close to home, continuity of care and originating site 
fees to the local providers. These services do not cost the 
patients any more than traditional visits, but save them a 
tremendous amount of time and money on travel. For the clinics, 
we are able to bring a more comprehensive healthcare offering 
to their community. Keeping services in communities not only 
supports the local providers, but keeps much needed employment 
---------------------------------------------------------------------------
and revenue in rural communities.

    Businesses in Mississippi that have utilized our telehealth 
and remote patient monitoring programs have demonstrated 
success by improving access to care, decreasing cost of care 
and improving quality of care for their employees. Healthy 
employees mean decreased absenteeism, increase productivity and 
a greater chance for small businesses to remain viable.

    Thank you for your time and attention to this very 
important matter.
                       Written Testimony

                               By

                      David F. Schmitz, MD

          National Rural Health Association, President

       On behalf of the National Rural Health Association

                            For the

                      United States House

                  Committee on Small Business

             Subcommittee on Health and Technology

                         July 20, 2017
    Good morning, Mr. Chairman, Ranking Member Velazquez, and 
members of the Subcommittee. Thank you for inviting me here to 
testify. I am Dr. David Schmitz, a family physician who has 
practiced and taught in rural America for 20 years. I am here 
today representing the National Rural Health Association where 
I currently serve as president. I am grateful for this 
opportunity to discuss rural health care and its impact on 
rural America and local economies.

    NRHA's mission is to improve the health and wellbeing of 
all rural Americans and as such, we recognize the important 
role that health care serves in the economic development of 
rural communities across the country. The economic needs of 
rural America are vastly different than those faced by 
counterparts in other geographic and population settings. So 
too are the health care challenges, and opportunities, for 
rural health care providers.

    Today I will discuss some of the unique challenges to 
health care in rural America. I will discuss how rural America 
has also faced unique economic challenges, and how strong rural 
health care providers can rise to those challenges by providing 
direct jobs, stimulating indirect jobs, supporting the growth 
of employers in other industries, and bolstering entire rural 
communities.

    I am here today to talk about the investments that we need 
to make to ensure that rural health care thrives and, in 
return, rural economies thrive and sustain our communities. 
NRHA believes that improving access to care by investing in 
rural health care--from workforce to technology 
infrastructure--is a means to bolster the local economy. This 
must be a priority for both the Administration and Congress.

    Barriers and Challenges of Rural Health Care

    For the 62 million Americans living in rural and remote 
communities, access to quality, affordable health care is a 
major concern. Rural Americans on average are older, sicker and 
poorer than their urban counterparts. They are also more likely 
to suffer from chronic diseases that require monitoring and 
follow-up care.

    Local care is necessary to ensure patient ability to adhere 
to treatment plans, to help reduce the overall cost of care, 
and to improve patient outcomes and their quality of life. 
Whether following delivery of a baby or a significant loss of 
function due to stroke, locally integrated care for rural 
people and their own support system is not only the right care, 
it's better care. Rural communities are resourceful and 
continuity of care is primary to good outcomes such as 
avoidance of hospital re-admission. Investing dollars locally 
can save many more otherwise wasted dollars lost to 
inefficiencies, anonymity and the gaps that occur in the miles 
between.

    There is no doubt that rural health care delivery is 
challenging. Workforce shortages, older and poorer patient 
populations, geographic barriers, low patient volumes and high 
rates of publicly insured Medicare and Medicaid recipients, 
uninsured and underinsured populations are just a few of the 
barriers.\1\

    Unfortunately, a growing number of rural Americans are 
living in areas with limited health care options. Indeed, 81 
rural hospitals have closed since 2010, leaving many rural 
Americans without timely access to emergency care. The two most 
recent of these, closing on June 30th of this year, are in 
Florida and Texas. The majority rural closures are in states 
that did not expand Medicaid, and with reductions in the 
Disproportion Share (DSH) payments that helped hospitals cover 
bad debts incurred by serving high rates of uninsured people, 
these hospitals could not survive.\2\, \3\, \4\, \5\, \6\ There 
are 673 additional rural hospitals that are on the brink of 
closure.

    The health disparities between rural populations and their 
urban counterparts are pronounced. This can be particularly 
true among the growing minority populations in rural America. A 
recent study in the Journal of Rural Health underscored the 
alarming extent of these challenges.

    Using data from the National Center for Health Statistics, 
and adjusting for age, the researchers found that rural whites 
have 102 more deaths per 100,000 members of the population than 
their urban counterparts. Rural blacks have 115 more deaths per 
100,000 than their urban counterparts. The number of excess 
rural deaths from 1986 to 2012 was 694,000 for whites and 
53,000 for blacks.\7\

    Economic Impact of Rural Providers

    Rural health care providers are not only critically 
important for the health of rural Americans, the providers are 
critically important for the economic health of rural 
communities.

    Much of rural America was left behind in the economic 
recovery. According to the United States Department of 
Agriculture (USDA), rural counties were losing 200,000 jobs per 
year and the rural unemployment rate stood at nearly 10 percent 
during the Great Recession. Since then, economic recovery 
hasn't returned to rural America. In fact, 95% of the jobs that 
have returned after the Great Recession have been to urban, not 
rural areas.

    While many industries in rural America have been shrinking, 
for a wide variety of reasons, health care is an industry with 
the potential to reverse declining employment. As factory and 
farming jobs decline, the local rural hospital often becomes 
the hub of the local business community--not only offering 
critical life-saving services, but representing as much as 20 
percent of the rural economy.

    Simply put, hospitals provide a large number of jobs. The 
economic wellbeing of rural American towns depends on a healthy 
rural economy, which is anchored by the local rural hospital 
and local provider. The average Critical Access Hospital (CAH) 
creates 195 jobs and generates $8.4 million in payroll 
annually. Rural hospitals are often the largest or second-
largest employer in a rural co9mmunity (along with the school 
system). In addition, even a single rural primary care 
physician can generate 23 jobs and more than $1 million in 
annual wages, salaries and benefits.\8\

    Because hospitals provide so many jobs, it follows that 
their closure has a devastating effect on employment. If 
Congress allows the 673 additional vulnerable rural hospitals 
to shut their doors, 99,000 direct health care jobs and another 
137,000 community jobs will vanish.

    A critical component of maintaining economic stability in 
rural communities is ensuring that rural hospitals and other 
health care providers are able to remain in their communities. 
Protecting rural hospitals from closure is an immediate step 
that can be taken to prevent significant job loss in rural 
communities.

    Workforce challenges also exist in rural America. The rural 
health landscape with its uneven distribution and shortage of 
health care professionals is faced with significant problems in 
recruiting and retaining a trained health care workforce. This 
is compounded by the disparity in federal reimbursement for 
rural providers, which if addressed, would not only improve the 
recruitment and retention of rural physicians, but would also 
stabilize the rural economy.

    Providers are more likely to practice in a rural setting if 
they have a rural background, participate in a rural training 
program (RTT Technical Assistance Program) and have a desire to 
serve rural community needs. The RTT Technical Assistance 
Program \9\ identified that residents training in rural 
training track residency programs were about twice as likely to 
practice in rural areas following graduation than family 
medicine graduates overall.\10\ Likewise, an emphasis on inter-
professional education, rural medical school tracks, admission 
of rural and minority students to health professions education 
are all part of the workforce solution. Training doctors and 
other health professionals close to home makes it more likely 
they will call that place home. Investments in rural 
distributed medical education are supported by such programs as 
Area Health Education Centers (AHES),\11\ and supported by 
organizations such as the RTT Collaborative, a not-for-profit 
sustainable result of the RTT Technical Assistance Program.

    To train and educate physicians who will practice in rural, 
the presence of hospitals and clinics in these rural 
communities must be present to become part of the ``rural 
medical education campus.'' Distributed medical education 
campuses across rural states and rural America then become the 
platform for workforce initiatives that work, develop 
infrastructure to support quality healthcare delivery and 
produce economic value. Graduate medical education regulatory 
reform that allows for common sense investment specifically 
allowing for education of physicians in rural hospitals is one 
example of how to address rural economic development and 
workforce shortages in one action, while improving quality and 
delivering cost-saving healthcare.

    The Local Scale: How a Healthy Population Means a Healthy 
Economy

    The benefits of strong rural health care providers spread 
far beyond the number of people directly employed in a 
hospital.

    Consider the case of Beatrice, Nebraska, a rural town in 
Gage County, Nebraska. The town has a burgeoning economy 
largely thanks to the Beatrice Hospital, a CAH with 25 beds, 
and its related health services. Beatrice is an example of how 
related health care services flourish when a strong local 
hospital is nearby. In Beatrice, home health services and 
assisted living homes have sprung up around the hospital to 
fulfill the necessary care for the town's elderly (the town's 
average age is six years higher than the state of Nebraska's 
average age).

    Beatrice Hospital shows how significant the direct and 
indirect effects of a good hospital are for rural communities. 
Beatrice Hospital is the town's largest employer with 512 
workers. Its payroll is nearly $28 million, and the average 
starting salary for a nurse is $40,000.

    The wages provided by the hospital's good jobs circulate 
throughout the local economy, stimulating small businesses, the 
local real estate market and more in a virtuous circle for the 
community. That's why across the country, small rural towns 
like Beatrice, ``have emerged as oases of economic stability 
across the nation's heartland.'' \12\

    Rural hospitals provide other types of indirect stimulus as 
well. A hospital's construction and maintenance requires non-
hospital-affiliated labor and external contractors to complete. 
In order to build and maintain a hospital, and receive these 
benefits, investment in local resources and labor are 
necessary.

    One way to quantify the total impact of the indirect 
economic benefits of rural hospitals is using employment and 
labor multipliers. These multipliers are used to measure job 
and revenue creation upon the entrance of a hospital into a 
specific market.

    If a hospital has an employment or labor multiplier greater 
than one, it has a positive indirect economic impact. For 
instance, an employment multiplier of 1.35 would mean that a 
100-employee hospital also creates 35 new, non-health-related 
jobs for local economy. The typical CAH has an employment 
multiplier of 1.38.

    An alternate approach is to look at the multiplier on wages 
and salaries. For instance, the average wages multiplier for 
rural hospitals is estimated at 1.24. That means that a rural 
hospital with $10 million in wages, indirectly generates an 
additional $2.4 million in local salaries and incomes outside 
the hospital.

    Consider what these multipliers mean for a hospital like 
the one in Beatrice. The 512-direct jobs generate 179-indirect 
jobs across the community. The $28 million in direct wages 
generates $6.7 million in additional wages throughout the 
community.

    And, in Apalachicola, Florida, the George E. Weems Memorial 
Hospital is a 25-bed Critical Access Hospital that not only 
provides dynamic health care services to Franklin County and 
the surrounding area, but it also has an employment multiplier 
of 1.40. The $1.8 million in local retail sales attributed to 
hospital generates significant sales tax collection.

    The multipliers for other types of rural hospitals are 
similar. The economics are clear that rural hospitals are 
powerful engines for boosting job creation and increasing 
earnings across a rural community.

    Locating and Expanding Businesses in Rural

    The quality of a community's local health care system is a 
key factor for firms that are considering where to relocate or 
expand. Access to quality health care is the number two 
priority for firms who are making decisions on relocation and 
expansion. The only thing more important to firms is having 
access to a skilled workforce.

    Without local access to care, the rural economy struggles 
to grow and thrive. When a community loses access to local 
health care, it affects the ability of all businesses in the 
community to go about their business and grow. It is difficult 
for companies to attract workers with young or expanding 
families when care for a sick child is not available locally, 
or if the family must travel hours for prenatal and maternity 
care.

    Knowing you have an emergency room nearby to treat your 
employees is essential for many businesses, especially within 
sectors such as farming or energy. The difficult work behind 
producing our food and energy supply is vital to our nation's 
economy. This work, which must often be performed in rural and 
remote areas, has intrinsic risks and dangers. Workers in these 
vital sectors of the American economy need and deserve access 
to quality and affordable health care.

    Technology such as telemedicine for consultation services 
have supported rural delivery of care but depend on the 
adequate development of broadband internet into rural and 
remote areas. Networks developed for education and building 
technology-based ``virtual communities'' can share of best 
practices and an example such as with Project ECHO will 
continue to bring more support to rural hospitals and clinics. 
Still, hands-on care is needed when an unexpected car accident 
or early delivery of a newborn baby occurs in rural America, no 
matter if you are a local resident or visiting. Each one of us 
who spend time and dollars in rural communities will appreciate 
quality, local care in those moments.

    Access to health care is related to the sustainability of 
small businesses, another hallmark of healthy economies. A 
rural community simply cannot attract entrepreneurial 
investment and talent--or entice native talent to remain--
without appropriate health services. Small business leaders 
contribute jobs and more circulating dollars, infusing rural 
economies with increased assets.

    Supporting the Whole Community

    The town of Jefferson, Illinois is a testament to the role 
of a hospital in economic growth. Rand Fisher, president of the 
Iowa Area Development Group, asserts, ``To be successful in 
business development today, we believe you also have to be very 
focused on community development.''

    Fisher is referring to the multi-pronged approach that 
development-minded communities must take. They must focus on 
industrial retention, recruitment and entrepreneurship, and 
community betterment that provides better access to education 
and health care. A rural hospital is one agent that fulfills 
all these roles.

    Jefferson is ``drawing new residents and keeping existing 
ones through strong business and community development 
programs,'' not least of which is its recent hospital 
renovation. A technological investment introduced state-of-the-
art equipment and improved facilities that are better able to 
serve patients.\13\

    Rural hospitals provide cost-effective primary care. It is 
2.5 percent less expensive to provide identical Medicare 
services in a rural setting than in an urban or suburban 
setting. This focus on primary care, as opposed to specialty 
care, saves Medicare $1.5 billion per year. Quality performance 
measurements in rural areas are on par with if not superior to 
urban facilities. Additionally, CAHs represent nearly 30 
percent of acute care hospitals but receive less than 5 percent 
of total Medicare payments.

    When a rural hospital closes or a physician leaves, 
businesses, families, and retirees are forced to leave. Often, 
rural physicians are hospital-based. When the hospitals close, 
the physicians leave, soon followed by nurses, pharmacists and 
other providers. Medical deserts are forming across rural 
America. Hundreds of rural jobs are lost, home values drop, and 
those who can't sell their home are stuck in a dying town that 
can no longer meet their basic needs. A study shows that ``the 
closure of a rural county's sole hospital decreases the 
economic well-being of the community and likely places the 
local economy in a downward cycle that may be very difficult to 
recover from.'' \14\

    All of these examples show why a strong rural health care 
system is vital to our states' economies. The rural health care 
system provides a large number of direct jobs, a large number 
of indirect jobs, and provides key support for every business 
in a local community. We have seen the devastating impact that 
the Great Recession has had on rural communities across the 
country. Health care is one industry capable of playing a 
critical role supporting the local economy, and protecting 
rural communities from further economic damage. If roads and 
Internet access are the blood vessels and nerves, then health 
care is the backbone to investing in rural America.

    Recommendations

    When rural hospitals and providers thrive, so do the 
physical and fiscal health of the community. The following are 
NRHA's recommendations:

          1. H.R. 2957, the Save Rural Hospitals Act. Passage 
        of this important bill will provide immediate relief to 
        rural hospitals by stopping the onslaught of 
        reimbursement cuts that have hit rural hospitals. 
        Without increasing reimbursement rates, it will 
        stabilize payments and stop rural hospital closures. It 
        will also create a new health care delivery model that 
        is flexible for the many varied needs in rural 
        communities. Hospitals are essential to rural 
        communities, not just for access to emergency care but 
        for the high-quality jobs supported by the hospital. If 
        the hospital closes, these rural communities will 
        likely face higher poverty rates.

          2. Education: Continue to fund health workforce 
        programs to not simply recruit individuals to rural 
        areas but to reward those individuals that stay for 
        extended periods of time in these communities. 
        Regulatory reforms related to rural graduate medical 
        education can have a near-term positive effect on 
        workforce and rural economic growth.

          3. Rural Health Networks: Expand funding for the 
        creation of rural health networks with the intention of 
        identifying innovative strategies to expand services to 
        all residents through access to quality care at a local 
        integrated level, lower costs and a better patient 
        experience.

          4. Research: The federal government should support 
        research that explores the linkages between a strong 
        healthcare system and sustainable local economies in 
        rural communities.

          5. Technology Infrastructure: Provide access to 
        capital through grants and loans for facilities to 
        adopt new technology for Electronic Medical Records 
        (EMRs) and to meet all stages of meaningful use. In 
        addition, provide educational programs to train 
        doctors, nurses and other staff not just how to use the 
        technology but how to interpret the data and how to 
        make recommendations for quality improvement. Broadband 
        access in rural America teamed with health professions 
        education access and ongoing support of practice 
        reduces professional isolation, sustains workforce and 
        improves quality.

          6. Telehealth: Rural providers and other agencies are 
        seeking to implement new medical technologies to 
        enhance quality and delivery of medical care. 
        Telehealth is an example of one of the most important 
        technologies for rural providers. In 2013, over 40,000 
        rural beneficiaries received at least one telemedicine 
        visit, and this number is expected to continue to grow. 
        If rural providers are to move toward an online future, 
        they must invest in necessary technological 
        infrastructure and systems. Government grants and 
        private investment in technological advancements can 
        increase the flow of new dollars into rural economies, 
        empowering local resources to further health 
        infrastructure.

    The National Rural Health Association appreciates the 
opportunity to provide our testimony and recommendations to the 
subcommittee. An investment in the rural health delivery system 
is important to maintaining access to high quality care in 
rural communities and to a healthy, vibrant economy. We greatly 
appreciate the support of the subcommittee and look forward to 
working with members of the subcommittee to continue making 
these important investments for rural America.


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