Product Focus: Critical Access Hospitals (July 2008)

Program is benefitting CAHs

NUMBER OF RURAL REPLACEMENT HOSPITALS IS ON THE RISE

By Dan Emerson

Just as America’s population is aging, so are its rural hospitals. In fact, most of the hospitals serving the country’s rural areas were designed and built 50 years ago or more under postwar funding provided by the Hill-Burton Act.

In recent years, more public and private sector efforts have been focused on replacing the outdated hospitals, especially those designated as critical access hospitals (CAHs). The federal government created the CAH designation in 1997 to help assure Medicare beneficiaries access to healthcare services in rural areas.
 
The Rural Community Hospital Assistance Act improved Medicare payments to small hospitals in rural areas of the country and allowed CAHs with 25 beds or fewer to receive reimbursements based on actual costs – as opposed to a percentage of costs. Those costs include follow-up care such as skilled nursing and home health services. CAHs are exempt from HUD-mandated Certificate of Need (CON) requirements.

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