CMS Proposal Details How to Become New Rural Hospital Designation

From Fierce Healthcare

The Biden administration released a proposed rule that grants more regulatory flexibility for small, rural hospitals in a bid to curb a worrying trend of facility closures.

The Centers for Medicare and Medicaid Services’ proposed rule released on June 30, 2022 outlines the conditions of participation for a facility to become a Rural Emergency Hospital, which enables a facility to offer emergency care, observation and other outpatient services.

“The availability of the new Rural Emergency Hospital provider type will maintain access to essential healthcare services and help to reduce disparities in rural communities,” said CMS Administrator Chiquita Brooks-LaSure in a statement.

CMS’ goal for the new designation is to enable small facilities in rural areas and critical access hospitals to “right-size their service footprint and avoid potential closure,” according to a fact sheet on the rule

An emergency hospital can offer additional medical and outpatient services that don’t exceed an annual per-patient average of 24 hours, the fact sheet added.

Overall, the conditions of participation closely align with current conditions for critical access hospitals. However, CMS is seeking comments on specific standards for the rural facilities, such as whether the agency should require a facility to also provide outpatient surgery services if surgical labor is necessary.

“CMS is also requesting comments regarding whether it is appropriate for a [rural emergency hospital] to allow a doctor of medicine or osteopathy, a physician assistant, a nurse practitioner, or a clinical nurse specialist, with training or experience in emergency medicine, to be on call and immediately available by telephone or radio contact and available on-site within specified timeframes,” the fact sheet said.

The rule does not outline the payment rates for such rural emergency hospitals, but CMS hinted that information will likely be included in the 2023 Outpatient Prospective Payment System-Ambulatory Surgical Center payment rule set to be released in July.

The new designation was created in a spending bill last year intended to help stem a deluge of hospital closures in rural areas. HHS said that, since 2010, there have been 138 rural hospitals that closed, with 19 closing down in 2020 alone.

Provider relief funding to help offset the financial impacts of the COVID-19 pandemic helped to temporarily stave off closures, said George Pink, a professor with the University of North Carolina’s Rural Health Research Program, during a webinar Wednesday sponsored by the Bipartisan Policy Center.

The proposed CoP are detailed at:

The due date for comments is August 29, 2022.