Rural Hospital Closure Relief Act of 2021

To amend title XVIII of the Social Security Act to restore State authority to waive for certain facilities the 35-mile rule for designating critical access hospitals under the Medicare program, and for other purposes. 1. Short title This Act may be cited as the Rural Hospital Closure Relief Act of 2021 2. Restoring State authority to waive the 35-mile rule for certain Medicare critical access hospital designations (a) In general Section 1820 of the Social Security Act ( 42 U.S.C. 1395i–4 (1) in subsection (c)(2)— (A) in subparagraph (B)(i)— (i) in subclause (I), by striking at the end or (ii) in subclause (II), by inserting at the end or (iii) by adding at the end the following new subclause: (III) subject to subparagraph (G), is a hospital described in subparagraph (F) and is certified on or after the date of the enactment of the Rural Hospital Closure Relief Act of 2021 ; and (B) by adding at the end the following new subparagraphs: (F) Hospital described For purposes of subparagraph (B)(i)(III), a hospital described in this subparagraph is a hospital that— (i) is a sole community hospital (as defined in section 1886(d)(5)(D)(iii)), a medicare dependent, small rural hospital (as defined in section 1886(d)(5)(G)(iv)), a low-volume hospital that in 2021 receives a payment adjustment under section 1886(d)(12), a subsection (d) hospital (as defined in section 1886(d)(1)(B)) that has fewer than 50 beds, or, subject to the limitation under subparagraph (G)(i)(I), is a facility described in subparagraph (G)(ii); (ii) is located in a rural area, as defined in section 1886(d)(2)(D); (iii) (I) is located— (aa) in a county that has a percentage of individuals with income that is below 150 percent of the poverty line that is higher than the national or statewide average in 2020; (bb) in a health professional shortage area (as defined in section 332(a)(1)(A) of the Public Health Service Act); or (II) has a percentage of inpatient days of individuals entitled to benefits under part A of this title, enrolled under part B of this title, or enrolled under a State plan under title XIX that is higher than the national or statewide average in 2019 or 2020; (iv) subject to subparagraph (G)(ii)(II), has attested to the Secretary two consecutive years of negative operating margins preceding the date of certification described in subparagraph (B)(i)(III); and (v) submits to the Secretary— (I) at such time and in such manner as the Secretary may require, an attestation outlining the good governance qualifications and strategic plan for multi-year financial solvency of the hospital; and (II) not later than 120 days after the date on which the Secretary issues final regulations pursuant to section 2(b) of the Rural Hospital Closure Relief Act of 2021 (G) Limitation on certain designations (i) In general The Secretary may not under subsection (e) certify pursuant to a certification by a State under subparagraph (B)(i)(III)— (I) more than a total of 175 facilities as critical access hospitals, of which not more than 20 percent may be facilities described in clause (ii); and (II) within any one State, more than 10 facilities as critical access hospitals. (ii) Facility described (I) In general A facility described in this clause is a facility that as of the date of enactment of this subparagraph met the criteria for designation as a critical access hospital under subparagraph (B)(i)(I). (II) Nonapplication of certain criteria For purposes of subparagraph (B)(i)(III), the criteria described in subparagraph (F)(iv) shall not apply with respect to the designation of a facility described in subclause (I). ; and (2) in subsection (e), by inserting , subject to subsection (c)(2)(G), The Secretary shall (b) Regulations Not later than 120 days after the date of the enactment of this Act, the Secretary of Health and Human Services shall issue final regulations to carry out this section. (c) Clarification regarding facilities that meet distance or other certification criteria Nothing in this section shall affect the application of criteria for designation as a critical access hospital described in subclause (I) or (II) of section 1820(c)(2)(B)(i) of the Social Security Act ( 42 U.S.C. 1395i–4(c)(2)(B)(i) 3. CMI testing of new rural hospital delivery and payment model Section 1115A of the Social Security Act ( 42 U.S.C. 1315a (1) in subsection (b)(2)(A), by adding at the end the following new sentence: “The models selected under this subparagraph shall include the testing of a new rural hospital delivery and payment model (or models), as described in subsection (h).”; and (2) by adding at the end the following new subsection: (h) Testing of new rural hospital delivery and payment model (1) In general (A) Testing The Secretary shall test the implementation of a new rural hospital delivery and payment model (or models) that the Secretary determines would promote financially sustainable ways to ensure patient access to care in rural communities, which may include models under which such hospitals furnish outpatient emergency care services 24 hours a day, 7 days a week for which payment is made under title XVIII based on the amount determined under the prospective payment system for hospital outpatient department services under section 1833(t), plus a fixed rate for the cost of furnishing the emergency services. (B) Promulgation of regulations Not later than 3 years after the date of the enactment of this subsection, the Secretary shall promulgate regulations to test a new rural hospital delivery and payment model (or models) described in subparagraph (A), unless Congress enacts legislation that establishes such a payment model (or models) prior to the promulgation of regulations pursuant to this subparagraph. (2) Transition Effective beginning on the date on which the testing of a new rural hospital delivery and payment model (or models) described in paragraph (1)(A) is implemented under this subsection or such a payment model (or models) is established through the enactment of legislation described in paragraph (1)(B), the Secretary shall provide a process under which— (A) all critical access hospitals may transition to such new model or models under this subsection; and (B) any facility that was designated as a critical access hospital pursuant to a certification by a State under section 1820(c)(2)(B)(i)(III) may revert to the prospective payment model (or models) under which the facility received payment under title XVIII prior to being so designated. .

Summary: Rural Hospital Closure Relief Act of 2021 This bill allows additional hospitals to qualify as critical access hospitals (CAHs) that receive special payment under Medicare. Currently, in order to qualify as a CAH under Medicare, a hospital must either (1) be located more than 35 miles (or 15 miles in mountainous regions or areas with only secondary roads) from another hospital, or (2) have been certified prior to January 1, 2006, by the state as a necessary provider of services in the area. The bill allows a hospital to also qualify if the hospital is a small, rural hospital that (1) serves a health professional shortage area, or a high number of low-income individuals or Medicare or Medicaid beneficiaries; (2) has experienced financial losses for two consecutive years; and (3) attests to having a strategic plan to address financial solvency. In addition, the Center for Medicare and Medicaid Innovation must test a new delivery and payment model for rural hospitals that promotes financially sustainable access to care and must establish a corresponding transition process for CAHs.