CMS extends rural hospital payment program

CMS is accepting applications for its Rural Community Hospital Demonstration program.

The Centers for Medicare & Medicaid Services extended a long-standing payment program for rural hospitals and is accepting applications from hospitals that want to sign up.

CMS will accept applications for the Rural Community Hospital Demonstration program through May 17, with selections to be finalized by June, according to a fact sheet. The program was given a 5-year extension as part of the 21st Century Cures Act, which was passed in December, and it has been in place since 2004.

The program aims to test cost-based reimbursements for smaller, rural hospitals that are too large to be considered critical access hospitals (CAHs). Hospitals that were participating in the program as of December 30, 2014, are eligible for an extension under the Cures Act’s provisions, according to CMS.

CMS will give priority to qualified applicants in one of the 20 states with the lowest population densities. In addition to not meeting criteria to be a CAH, eligible hospitals must be located in a rural area, as defined by the Social Security Act, and have fewer than 51 inpatient beds, not including psychiatric or rehabilitation beds

The agency outlined part of its plans for implementation in a proposed payment rule released last week. Hospitals participating in the program under this extension, whether previous participants or new applications, would officially be enrolled beginning Oct. 1.

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In addition to soliciting applications, CMS is seeking more information from interested hospitals on the rural health crisis as it continues to evaluate the demonstration program and others that impact smaller facilities.

“The Request for Applications solicits information from interested hospitals regarding their financial and service-oriented challenges, as well as strategies and proposals for addressing them,” according to CMS. “We are also asking hospitals to describe the impact of rural hospital closures on the needs of their service area, and problems posed by the need to serve a sparse population.”