Sen. Hank Sanders introduced a bill last month in the state Senate that will address a critical health concern for rural counties such as Dallas County.

The issue involves the proliferation of services provided by non-hospital or “boutique” firms in rural areas that deprive rural health facilities of vitally needed income that subsidizes other services offered by the rural hospitals.

Sen. Sanders said, “The bill is very important. If it does not pass some hospitals located in rural areas will go out of business. Every rural community that has a hospital needs to be able to keep it.”

He continued, “The bill is still in the Senate Health Committee and it is late in the session. It is difficult to pass a bill in the time left if there is any opposition, and there is opposition to this bill.”

Sanders specifically distinguished between metropolitan areas such as Birmingham, Montgomery and Mobile which he said are large enough to absorb the addition of new services. It is the rural areas that are suffering, he said.

Sanders added that he had supported the exemptions added to the State Health Plan several years ago on the explicit promise that rural areas would not be adversely affected. “But they have been adversely affected – hence the need for the bill,” he said.

Sanders said there is a good likelihood that the bill will not be passed in this session and that he definitely plans to reintroduce it in the next if that is the case.

Specifically, the bill – SB 505 – would amend

the State Health Plan to reinstate a Certificate of Need (CON) for all health-care providers, including non-hospital providers, in “micropolitan” counties. “Micropolitan” is a new census designation for more populous rural counties. Dallas County is now designated as a micropolitan county under the new definition.

Services that had been exempted from the Certificate of Need, which are addressed by SB 505, include magnetic resonance imaging (“MRI”), extracorporeal shockwave lithotripsy and positron emission tomography (“PET”).

Under the current regulations, rural hospitals are losing significant amounts of money to fund vital, basic services such as emergency room, delivering babies and caring for the elderly. These are needs that are especially critical to rural Alabamians, according to a news release from Vaughan Regional Medical Center. The release also noted that rural hospitals depend greatly on income from surgery, diagnostic imaging and other currently exempted services such as MRI, lithotripsy and PET to cross-subsidize other vital services.

Vaughan Regional Medical Center CEO Steve Mahan said, “If free-standing imaging centers drain the profitable procedures from hospitals and leave only the uninsured and Medicaid patients, all hospitals are financially hurt. Diagnostics and surgery are where hospitals make money to cross-subsidize vital and unprofitable services such as 24-hour ER coverage, delivering babies and caring for the uninsured. Rural markets are not large enough or financially attractive

enough to absorb this kind of fragmentation of the rural health-care market without having a negative effect on the local hospital.”

The Vaughan release also stated that Mahan is joining health-care leaders from across the state who say it’s time to take action to amend the State Health Plan to ensure quality care in the 46 rural Alabama counties where one-third of the state’s population live.

Under the current State Health Plan, there are a number of exemptions to the requirement for a Certificate of Need. SB 505 would require CON review for all providers desiring to establish services now exempted in rural or micropolitan counties.

Vaughan Regional Medical Center, Parkway Campus, is one of 54 rural hospitals that stand to benefit from the passage of SB 505, according to the Vaughan release.