Rural Emergency Hospitals
The Rural Emergency Hospital (REH) is a new Medicare provider type that provides 24-hour emergency services but does not include inpatient care.
Background
In December 2020, Congress passed the Consolidated Appropriations Act, which created a new Medicare provider type called the Rural Emergency Hospital (REH). The REH is a new rural hospital type that does not provide inpatient care but provides 24-hour emergency services. It was created in response to an ongoing period of hospital closures in rural communities and the concerns of access to emergency services in rural areas. According to the legislation, a critical access hospital or small rural hospital with no more than 50 beds can convert to a REH and begin providing services starting Jan. 1, 2023.
Payment
Under statute, REHs must be paid 105% of the Outpatient Prospective Payment System (OPPS) rate for covered outpatient services, plus an additional facility payment. The Centers for Medicare & Medicaid Services (CMS) finalized a monthly facility payment of $272,866 for CY 2023 – approximately $3.2M annually for each facility. In future years, the additional annual facility payment will be increased by the hospital market basket percentage. CMS will also broadly consider all covered outpatient department services as “REH services” and will pay at the applicable OPPS payment rate plus 5%. However, REHs are not eligible for the 340B Drug Pricing Program.
Conditions of Participation
REHs are aligned with most Critical Access Hospital conditions of participation and must be staffed 24 hours a day, seven days a week. They are required to provide:
- 24-hour emergency services
- Laboratory services identified in the Critical Access Hospital Conditions of Participation and consistent with the needs of the patient population
- Diagnostic radiologic services
- Pharmacy or drug storage area
- Discharge planning by, or under the supervision of, a registered nurse, social worker, or other qualified professional
REHs cannot exceed an annual average length of stay of 24 hours per patient. They also cannot operate swing beds but may maintain a distinct part skilled nursing facility. REHs can convert back to their previous CAH or PPS provider type, however they will lose any grandfathered necessary provider waiver.
MHA Community Outreach Toolkit
Use the following resources to help facilitate public conversations about REH conversion and explain the implications for local health care services.
Resources
Webinar Series
MHA hosted a webinar series providing an overview of the new provider type and the potential impact on Minnesota’s rural health care landscape. Each webinar focuses on different topics:
- June 20, 2023: General overview
- July 18, 2023: Financial considerations
- Aug. 15, 2023: Quality and conditions of participation, Overview of the REH Technical Assistance Center
This information is supported by the Health Resources and Services Administration (HRSA) of the U.S. Department of Health and Human Services (HHS) as a part of an award totaling $79,000. The contents are those of the author(s) and do not necessarily represent the official views of, nor the endorsement, by HRSA, HHS, or the U.S. Government.