Pennsylvania rural hospitals to experiment with new payment model

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Five Pennsylvania hospitals will test a new payment model as part of a program designed to improve rural community health and put struggling rural hospitals on stable financial footing.

The program uses a global budget payment model in which hospitals receive fixed funding for a fixed period of time to improve rural community health, instead of  paying hospitals for individual services or cases, according to a news release from the Hospital and Healthsystem Association of Pennsylvania.

Association President and CEO Andy Carter told public radio station WITF the global budget model will allow hospitals to focus resources to its needs, such as substance abuse or mental health services.

"Normally you wouldn't have had the money to do that," he said. "Now you have this fixed pot of resources that allows you to build the program for better mental healthcare in the community."

The program — a partnership between Pennsylvania's rural hospital community, the state health department and the Center for Medicare & Medicaid Innovation — began Jan. 1.

The five rural hospitals participating in the first-year pilot are: Barnes-Kasson Hospital in Susquehanna; Endless Mountains Health Systems in Montrose; Geisinger Jersey Shore (Pa.) Hospital; UPMC Kane (Pa.); and Wayne Memorial Hospital in Honesdale.


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