On September 6, 2024, CMS released revised guidance regarding the process by which rural hospitals and outpatient facilities can participate in Medicare as a Rural Emergency Hospital (REH) rather than a Critical Access Hospital (CAH) or Rural Hospital. CMS will provide final revised interpretive guidance for REH enrollment and conversion at a later date.
The REH category was established by the Consolidated Appropriations of Act of 2021 in response to concerns over rural hospital closures. Medicare currently pays REHs (which provide emergency outpatient services to patients that generally stay less than 24 hours) 5% more than the Hospital Outpatient Prospective Payment System (OPPS) amount for services rendered to Medicare patients. Services paid at this rate include covered outpatient services such as radiology, laboratory, outpatient rehab, surgical, maternal health, and behavioral health.
According to CMS’s one-page “Rural Emergency Hospitals” fact sheet, in order to qualify as a REH, a facility must satisfy the following:
- Be enrolled in Medicare; and
- Either “be operating as a [CAH] as of December 27, 2020; or [o]perating as a small rural acute care, tribally operated, or Indian Health hospitals with no more than 50 certified beds as of December 27, 2020, and either located in a rural county (or equivalent local unit), using the Metropolitan Statistical Areas defined by the Office of Management and Budget, or treated as being located in a rural area.”
Further according to CMS’s one-page fact sheet, “[o]nce enrolled as an REH, a facility must meet the following requirements:
- Must not exceed an annual per patient average length of stay of 24 hours of services[;]
- Must meet the specified REH Conditions of Participation (CoPs)[;]
- Must meet staff training and personnel requirements, which include:
- A staffed emergency department 24 hours a day, 7 days a week, with staffing requirements like those for critical access hospitals (CAHs)
- A physician, as defined in Section 1861(r) (1) of the Social Security Act (the Act), nurse practitioner, clinical nurse specialist, or physician assistant, as those terms are defined in Section 1861(aa)(5) of the Act, available to provide rural emergency hospital services in the facility 24 hours a day.
- Must have a transfer agreement in effect with a Medicare-certified Level I or Level II trauma center[;]” and
- “Must not provide, starting as of the date of enrollment as an REH, any inpatient services, except those delivered in a distinct part unit licensed as a skilled nursing facility (SNF).”
See CMS’s one-page fact sheet, “Rural Emergency Hospitals,” released September 11, 2024, available here.
Eligible CAHs and Rural Hospitals need to already be enrolled in Medicare to convert to REH status. These facilities can convert to REH status by submitting a change of information online through the Medicare Provider Enrollment, Chain and Ownership System (PECOS) pursuant to 42 CFR §424.575 and by submitting a CMS-855A application to the hospital’s Medicare Administrative Contractor.
The conversion process, which does not require an application fee, requires the facility to develop an action plan for the facility’s conversion to a REH including identifying the specific services the facility will retain, modify, add, and discontinue, as well as provide a description of how the facility will use the additional payment it will receive.
Once the conversion is completed, the facility’s classification as a CAH or Rural Hospital will be terminated. REHs can convert back to a CAH or Rural Hospital; however, they would be considered as a “new” CAH or Rural Hospital. This means that they would need to follow the applicable existing initial provider enrollment and certification procedures, which would include a new CMS-855A and payment of any applicable fees, among any other requirements.
CMS’s revised Guidance for Rural Emergency Hospital Provisions, Conversion Process and Conditions of Participation, released September 6, 2024, is available here.
