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Centers for Medicare and Medicaid Services: Rural Community Hospital Demonstration

Deadline: May 17, 2017

The Centers for Medicare & Medicaid Services (CMS) is conducting the Rural Community Hospital Demonstration Program, which has been extended for an additional five years. The program tests the feasibility and advisability of cost based reimbursement for small rural hospitals that are too large to be Critical Access Hospitals. CMS is conducting an intensive evaluation of the demonstration, assessing the financial impact on participating hospitals, as well as the effect on health care for the populations served.

The demonstration provides and tests payment under a reasonable cost-based methodology for inpatient services furnished by participating hospitals. The goal is to increase the financial viability and capability of the selected rural community hospitals to meet the health care needs of Medicare beneficiaries in their service areas, and to promote high quality and efficient health care delivery. Applicants must specify interventions that both increase access to and improve the quality of care, while enhancing patient care options and the ability for beneficiaries to remain in their communities.

Amount: Hospitals will receive payment for Medicare inpatient services, with the exclusion of services furnished in a psychiatric or rehabilitation unit that is a distinct part of the hospital (see solicitation for more details).

Eligibility: Hospitals that:

  • Are located in a rural area (as defined in section 1886(d)(2)(D) of the Social Security Act (42 U.S.C. 1395ww(d)(2)(D)) or treated as being so located pursuant to section 1886(d)(8)(E) of the Act (42 U.S.C. 1395 ww(d)(8)(E)))
  • Have fewer than 51 acute care inpatient beds, as reported in its most recent cost report (beds in a psychiatric or rehabilitation unit which is a distinct part of the hospital shall not be counted)
  • Make available 24-hour emergency care services
  • Are not eligible for Critical Access Hospital (CAH) designation, or has not been designated a CAH under section 1820 of the Social Security Act

Hospitals may be located in any state. CMS will give priority in selecting new participants to hospitals that are located in one of the 20 states with the lowest population densities: Alaska, Arizona, Arkansas, Colorado, Idaho, Iowa, Kansas, Maine, Mississippi, Montana, Nebraska, Nevada, New Mexico, North Dakota, Oklahoma, Oregon, South Dakota, Utah, Vermont and Wyoming.

Link: https://innovation.cms.gov/initiatives/Rural-Community-Hospital/

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