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Testimony on the National Rural Development Partnership by Claude Earl Fox, M.D., M.P.H.
Administrator
Health Resources and Services Administration
U.S. Department of Health and Human Services

Before the Senate Committee on Agriculture, Nutrition and Forestry, Subcommittee on Forestry, Conservation and Rural Revitalization
March 8, 2000

Good afternoon, Senator Craig. I want to thank you and the Committee for the opportunity to provide testimony on our experience with the National Rural Development Partnership. I currently serve as the Administrator for the Health Services and Resources Administration at the Department of Health and Human Services but I come by my interest and concern for rural America honestly. I was born in a rural hospital, grew up in a small rural town, and have worked in and with rural communities most of my life. During my time as the State Health Officer in Alabama, I chaired the Alabama Task Force on Rural Hospitals and was part of an important effort there to help champion the critical role these facilities play in their communities. Now, as Administrator of HRSA, I oversee an agency that puts a great deal of resources into rural communities through a variety of programs such as the Community and Migrant Health Center Program, the Maternal and Child Health Block Grant, the Rural Health Outreach Program, and the Area Health Education Center program, just to name a few.

As you know from your own home state, the challenges faced by rural communities are many. Resources are limited, poverty rates are high and rural communities are notoriously susceptible to economic downturns when crop prices drop or natural disasters strike. Higher rates of rural poverty increase the importance of temporary financial assistance, child care subsidies, Head Start and other social services programs. The rural health care system is also quite fragile. Hospitals in rural areas are disproportionately dependent on Medicare and Medicaid reimbursements. Communities have a hard time attracting and retaining doctors and other health care providers. Rural hospitals and rural health care systems play a much larger role in their local communities than simply providing health care services.

They are often among the largest local employers and a bellwether of the economic health of a small town. Research shows that the health sector provides 10 to 15 percent of the jobs in many rural counties, and that if the secondary benefits of those jobs are included, the health care sector accounts for 15 to 20 percent of all jobs. On an individual employer basis, hospitals are often second only to school systems as the largest employer in rural counties. Studies on industrial and business location also conclude that schools and health services are the most important quality-of-life variables in these decisions. A strong rural hospital can be a solid foundation for a strong small town with a diversified local economy and can serve as a magnet for other economic development. Conversely, a struggling rural hospital or the closure of a small rural hospital can often have the opposite impact on a small town through lost jobs and disincentives for businesses to locate and grow.

The Department has an ongoing commitment to rural America. The Office of Rural Health Policy, within my agency, was given the responsibility by Congress to advise the Secretary on rural health issues and policy. And I must say, that office has done a good job of highlighting the unique health needs and situations of rural communities and families. They're actively engaged in the regulatory process and work with HCFA to make sure Medicare and Medicaid policies are fair to rural communities. The Office also runs a variety of grant programs that help build, support and sustain the rural health care infrastructure.

That is just one part of the equation, though. The challenge comes in making sure we have a coordinated rural perspective, both within HHS and across the Government. Enter the National Rural Development Partnership (NRPD), providing HHS with information and encouragement to broaden our perspective. Early in the process, the Department of Agriculture invited HHS to participate in this effort to bring together rural stakeholders. We began our work with USDA on the development of the Presidential Initiative in 1990 and began contributing financially to the effort in 1991. HHS currently contributes approximately $422,000 annually and considers this sum a sound investment in a resource that continues to pay dividends. HHS also provides active staff representation to the National Rural Development Council. In fact, the HHS representative to the Council, Dianne McSwain, has served as the chair of the National Council for the last two years.

Since 1991, our work with the Partnership has helped HHS build an increasingly effective internal "rural voice." By that I mean we try to understand and account for the impacts our decisions have on rural communities. This has been a detailed process of raising awareness among our programs and staff offices. An important milestone was the establishment of a Department-wide workgroup and getting that workgroup recognized as a resource for rural input. I wish that I could say that the work is done, but we recognize that raising awareness and educating our colleagues is a continuous process.

Let me share with you several examples of our successes, using the NRDP resource:

• During the development of the review criteria for the state health care reform waivers, the Health Care Financing Administration worked with the HHS rural workgroup to identify appropriate questions on the impacts of these waiver proposals on rural populations. The HHS rural workgroup worked through the NRDP Healthcare Taskforce to identify issues and concerns and to translate that information into the question format that would be most helpful to HCFA. There is no question that this input resulted in a more effective review process, better service to the states applying for waivers and, eventually, a more responsive program response.
  
  
• When the Administration for Children and Families developed the Temporary Assistance for Needy Families regulations, the NRDP again worked with the HHS rural workgroup to provide ACF with comments on the potential impact of the proposed TANF rules on rural families. As the TANF rules have been implemented, several State Rural Development Councils have been very involved in welfare reform efforts in the rural communities in their states. ACF and the Assistant Secretary for Planning and Evaluation have worked to be responsive to the unique challenges of welfare reform in rural communities by funding research which includes rural-specific components and be providing technical assistance targeting those serving rural recipients.
  
  
• The NRDP Healthcare Taskforce assisted HRSA and HCFA in the development of a rural perspective in the State Children's Health Insurance Program outreach strategies. This work included putting together a rural subcommittee for the White House SCHIP Taskforce and developing a rural chapter for the White House SCHIP Outreach report. The NRDP also worked with the 36 State Rural Development Councils to provide rural comment during the recent SCHIP regulation development process.
  
  
• Recently, the HHS rural workgroup sponsored a meeting on rural child care in conjunction with the NRDP Welfare Reform Taskforce. Subsequently the NRDP and the HHS Child Care Bureau have forged an ongoing working relationship. For example, the Child Care Bureau devoted their most recent bi-annual Leadership Forum to issues of rural child care with Partnership members serving on the steering committee and as presenters. The Associate Commissioner of the Child Care Bureau has just participated in the NRDP National Policy Conference.

I could go on to list many more instances where the NRDP and the State Rural Development Councils have assisted HHS to do a better job. The Partnership is just that - a partnership of all levels of government and the private sector working together to ensure that our programs reach the people they are supposed to serve and do it as efficiently and effectively as possible. As a Federal administrator and a rural person, I am glad that the "rural voice" of the Partnership is available to my staff and myself.