II 

116TH CONGRESS 

1ST SESSION S. 2157 

To amend title XI of the Social Security Act to expand the use of global 

payments to hospitals in rural areas. 

IN THE SENATE OF THE UNITED STATES 

JULY 18, 2019 

Mr. CASEY introduced the following bill; which was read twice and referred 

to the Committee on Finance 

A BILL 

To amend title XI of the Social Security Act to expand 

the use of global payments to hospitals in rural areas. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Rural Hospital Sus5 tainability Act’’. 

6 SEC. 2. FINDINGS. 

7 Congress makes the following findings: 

8 (1) Approximately 10,000,000 individuals age 

9 65 and older live in rural America today. In fact, 1 


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1 out of every 4 older adults lives in a small town or 

2 other rural area. 

3 (2) Residents of rural areas are more likely to 

4 be poorer, sicker, and have lower incomes compared 

5 to their urban counterparts. 

6 (3) According to the Office of Rural Health 

7 Policy, from 2005 to 2009, people living in rural 

8 areas had an average life expectancy of 76.8 years, 

9 a full two years less than their urban counterparts 

10 who had an average life expectancy of 78.8 years. 

11 (4) Many rural hospitals are located in areas 

12 where a majority of the population is age 65 and 

13 older and has Medicare coverage. 

14 (5) Certain State-based demonstrations to im15 prove payment models for rural hospitals show 

16 promise in improving healthcare, reducing costs, and 

17 integrating services for patients. 

18 (6) Experts and organizations suggest that 

19 transitioning rural hospitals to global payment sys20 tems would benefit patients, providers, and rural 

21 communities. 

22 SEC. 3. EXPANDING THE USE OF GLOBAL PAYMENTS TO 

23 HOSPITALS IN RURAL AREAS. 

24 Section 1115A(b)(2) of the Social Security Act (42 

25 U.S.C. 1315a(b)(2)) is amended— 


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1 (1) in subparagraph (B), by adding at the end 

2 the following new clause: 

3 ‘‘(xxviii) National testing of a model 

4 for global payments to hospitals in rural 

5 areas as described in subparagraph (D).’’; 

6 and 

7 (2) by adding at the end the following new sub8 paragraph: 

9 ‘‘(D) NATIONAL TESTING OF MODEL FOR

10 GLOBAL PAYMENTS TO HOSPITALS IN RURAL

11 AREAS.—In the case where the Secretary selects 

12 the model described in clause (ii) of this sub13 paragraph for testing pursuant to clause (xxviii) 

14 of subparagraph (B), the following shall apply: 

15 ‘‘(i) NATIONAL TESTING.— 

16 ‘‘(I) IN GENERAL.—Subject to 

17 subclause (II), the Secretary shall 

18 allow each State to develop and sub19 mit to the Secretary an application to 

20 begin testing such model in accord21 ance with this clause within 1 year of 

22 the date on which the model is se23 lected for such testing. 

24 ‘‘(II) STATE DESIGNATION OF

25 ENTITIES.—A State may designate an 


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1 entity or organization for purposes of 

2 developing and submitting an applica3 tion under subclause (I) with respect 

4 to the State, which may include the 

5 implementation of such model in the 

6 State. In the case where a State 

7 makes such a designation, with re8 spect to any activities covered by the 

9 designation, the entity or organization 

10 so designated shall be subject to any 

11 requirements applicable to the imple12 menting State under this subpara13 graph in the same manner as such re14 quirements are applicable to the im15 plementing State. 

16 ‘‘(III) NO EFFECT ON ONGOING

17 MODELS OR DEMONSTRATION

18 PROJECTS.—Nothing in this subpara19 graph shall effect the testing of any 

20 model under this subsection or any 

21 demonstration project under this Act 

22 that is implemented prior to the date 

23 of the enactment of this subpara24 graph. 


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1 ‘‘(ii) MODEL DESCRIBED.—The model 

2 described in this clause seeks to increase 

3 rural Americans’ access to quality care in 

4 order to improve health, while also reduc5 ing the growth of hospital expenditures 

6 across payers, including Medicare, and in7 creasing the financial viability of rural hos8 pitals to ensure continued access to care. 

9 Under this model, participating rural hos10 pitals would— 

11 ‘‘(I) be paid based on all-payer 

12 global budget, a fixed amount that is 

13 set in advance for inpatient and out14 patient hospital-based services and 

15 paid monthly by Medicare fee-for-serv16 ice, State Medicaid plans, and all 

17 other participating payers; 

18 ‘‘(II) deliberately redesign the de19 livery of care to improve quality of 

20 care and meet the needs of their local 

21 communities; 

22 ‘‘(III) receive an upfront, fixed 

23 payment for infrastructure redesign, 

24 in an amount to be recovered over a 


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1 period of time as set forth by the Sec2 retary; 

3 ‘‘(IV) receive annual global budg4 et payment adjustments based on an 

5 amount determined in conjunction 

6 with the Secretary; and 

7 ‘‘(V) partner with non-hospital 

8 providers such as physicians, behav9 ioral health providers, schools, and 

10 community based organizations to cre11 ate a comprehensive care delivery sys12 tem. 

13 ‘‘(iii) DEFINITIONS.—In this subpara14 graph: 

15 ‘‘(I) IMPLEMENTING STATE.— 

16 The term ‘implementing State’ means 

17 a State whose application to begin 

18 testing such model is approved by the 

19 Secretary under clause (i). 

20 ‘‘(II) RURAL HOSPITAL.—The 

21 term ‘rural hospital’ means the fol22 lowing: 

23 ‘‘(aa) A critical access hos24 pital (as defined in section 

25 1861(mm)(1)). 


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1 ‘‘(bb) A sole community hos2 pital (as defined in section 

3 1886(d)(5)(D)(iii)). 

4 ‘‘(cc) A medicare-dependent, 

5 small rural hospital (as defined 

6 in section 1886(d)(5)(G)(iv)). 

7 ‘‘(dd) Any other hospital 

8 that is located in a rural area (as 

9 defined in section 1886(d)(2)(D)) 

10 or is treated as being located in 

11 a rural area pursuant to section 

12 1886(d)(8)(E). 

13 ‘‘(iv) REQUIREMENTS FOR PARTICI14 PATING HOSPITALS.— 

15 ‘‘(I) IN GENERAL.—In order to 

16 participate in the model in an imple17 menting State, a rural hospital 

18 must— 

19 ‘‘(aa) subject to subclause 

20 (II), conduct a community health 

21 needs assessment survey to deter22 mine the condition and health 

23 needs in their community, includ24 ing those needs with respect to 

25 mental or behavioral health; and 


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1 ‘‘(bb) following such assess2 ment survey, submit and, subject 

3 to clause (vi), receive approval of 

4 a Rural Hospital Transformation 

5 Plan (as described in clause (v)) 

6 from the implementing State and 

7 the Secretary. 

8 ‘‘(II) EXCEPTION.—A rural hos9 pital meets the requirement described 

10 in subclause (I)(aa) if the rural hos11 pital has conducted a community 

12 health needs assessment survey during 

13 the preceding year for any purpose. 

14 ‘‘(v) RURAL HOSPITAL TRANS15 FORMATION PLAN DESCRIBED.—A Rural 

16 Hospital Transformation Plan described in 

17 this clause, with respect to a rural hos18 pital, shall include the following informa19 tion: 

20 ‘‘(I) Results of the community 

21 health needs assessment survey under 

22 clause (iv)(I)(aa) and an explanation 

23 of how the Transformation Plan suits 

24 the needs of the community. 


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1 ‘‘(II) The population of individ2 uals who will be served by the rural 

3 hospital under the model. 

4 ‘‘(III) The types of services that 

5 will be included in the global payment 

6 under the model. 

7 ‘‘(IV) How the rural hospital in8 tends to improve quality and health 

9 outcomes under the model, including 

10 which population health outcomes the 

11 hospital will assess on an annual 

12 basis. 

13 ‘‘(V) How the rural hospital will 

14 achieve patient engagement and in15 volvement in the model. 

16 ‘‘(VI) How the rural hospital will 

17 identify, partner with, and pay other 

18 entities participating in the model. 

19 ‘‘(VII) How private payers will be 

20 included in the model. 

21 ‘‘(VIII) Plans to account for any 

22 market share changes under the 

23 model. 


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1 ‘‘(IX) How access to preventive 

2 care will be increased under the 

3 model. 

4 ‘‘(X) How the rural hospital will 

5 sustain the changes made under the 

6 model. 

7 ‘‘(XI) How savings under the 

8 model will accrue to the Medicare pro9 gram under title XVIII. 

10 ‘‘(XII) Any other information re11 quired by the implementing State or 

12 the Secretary. 

13 ‘‘(vi) OPPORTUNITY FOR PUBLIC COM14 MENT.—In order for the Secretary or an 

15 implementing State to approve a Rural 

16 Hospital Transformation Plan under 

17 clause (iv), the Secretary in consultation 

18 with the implementing State, shall— 

19 ‘‘(I) provide the public with a 

20 meaningful opportunity, as deter21 mined by the Secretary, to provide 

22 comments on the plan; and 

23 ‘‘(II) make a summary of com24 ments provided available to the public 


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1 on the Internet website of the Centers 

2 for Medicare & Medicaid Services. 

3 ‘‘(vii) TECHNICAL ASSISTANCE.—The 

4 Secretary shall designate an entity to pro5 vide technical assistance to participating 

6 rural hospitals as they redesign the care 

7 they deliver under the model. 

8 ‘‘(viii) ACCOUNTING FOR UNCER9 TAINTY.—In order for implementing States 

10 and participating rural hospitals to receive 

11 unanticipated additional resources needed 

12 to implement the model, the Secretary 

13 shall establish procedures for implementing 

14 States and participating rural hospitals to 

15 submit to the Secretary a request for addi16 tional resources, should variations in serv17 ices outside of normally planned volume 

18 occur or should new technologies be devel19 oped, or in such other circumstances as the 

20 Secretary determines appropriate. 

21 ‘‘(ix) MONITORING OUTCOMES.—The 

22 Secretary, in conjunction with imple23 menting States and participating rural 

24 hospitals, shall develop a plan to— 


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1 ‘‘(I) identify, using a partici2 pating rural hospital’s approved Rural 

3 Hospital Transformation Plan de4 scribed in clause (v), the relevant local 

5 population of patients attributable to 

6 the hospital, the data points the hos7 pital may need to guide care redesign 

8 for that population, and how the hos9 pital may use such data; 

10 ‘‘(II) annually monitor outcomes 

11 under the model, which may include 

12 financial, quality, access, and utiliza13 tion outcomes; 

14 ‘‘(III) annually monitor the spe15 cific population health outcomes listed 

16 in the approved Rural Hospital 

17 Transformation Plan of each partici18 pating rural hospital pursuant to 

19 clause (v)(IV); and 

20 ‘‘(IV) any other outcomes as de21 termined by the Secretary. 

22 ‘‘(x) RISK MITIGATION.—As part of 

23 the model, the Secretary, in conjunction 

24 with implementing States and participating 

25 rural hospitals, shall develop appropriate 


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1 mechanisms to mitigate risks, including 

2 the use of reinsurance. 

3 ‘‘(xi) REPORTING REQUIREMENTS.— 

4 ‘‘(I) REPORT TO SECRETARY.— 

5 An implementing State, as a condition 

6 of implementing the model, shall part7 ner with an independent entity to re8 port to the Secretary on the ability of 

9 a participating rural hospital to carry 

10 out the Rural Hospital Trans11 formation Plan described in clause 

12 (v). 

13 ‘‘(II) REPORT TO CONGRESS.— 

14 Not less frequently than every 5 years 

15 (for the duration of the implementa16 tion of the model under this subpara17 graph), the Secretary shall submit to 

18 Congress a report on the implementa19 tion of the model under this subpara20 graph. The report shall include best 

21 practices for future implementation 

22 efforts and any other information the 

23 Secretary determines appropriate, in24 cluding the information reported 

25 under subclause (I), together with recVerDate Sep 11 2014 21:22 Jul 23, 2019 Jkt 089200 PO 00000 Frm 00013 Fmt 6652 Sfmt 6201 E:\BILLS\S2157.IS S2157

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1 ommendations for such legislation and 

2 administrative action as the Secretary 

3 determines appropriate. 

4 ‘‘(xii) FUNDING.—The Secretary shall 

5 allocate funds made available under sub6 section (f)(1) to design, implement, evalu7 ate, and report on the model described in 

8 clause (ii) in accordance with this subpara9 graph.’’. 

Æ 


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