Rural Emergency Hospitals

What is a Rural Emergency Hospital?

On November 23, 2022, we published a final rule, effective January 1, 2023, establishing initial policies for Rural Emergency Hospitals (REHs) as a new Medicare provider type enacted in the Consolidated Appropriations Act (CAA) of 2021.

The rule finalized:

• The Conditions of Participation (CoPs) REHs must meet to participate in the Medicare and Medicaid programs
• REH payment policies
• REH quality measure reporting initial requirements
• REH enrollment policies

The CoPs are intended to:

• Ensure the health and safety of patients who receive REH services
• Consider the access and quality of care needs of an REH’s patient population

In most cases, REH standards closely align with the current Critical Access Hospital (CAH) CoPs, while accounting for REH’s unique needs and statutory requirements.

Why were REHs created?

The CAA, 2021 was signed into law on December 27, 2020 and established  REHs as a new Medicare provider to:

• Respond to rural hospital closures
• Give rural communities more access to health care

Section 125 of the CAA added section 1861(kkk) to the Social Security Act (the Act) and sets forth the statutory authority for REHs.

This new provider type will promote health equity for those living in rural communities by making it easier to access needed services.

What services do REHs provide?

When an eligible facility converts to an REH, it’s allowed to provide:

• Emergency department services
• Observation care and
• Additional outpatient medical and health services if elected by the REH, that do not exceed an annual per patient average length of stay of 24 hours

REHs are prohibited from providing inpatient services, except those furnished in a distinct part licensed as a skilled nursing facility to furnish post-hospital extended care services.

Since REHs provide emergency department services, they must comply with:

• The Emergency Medical Treatment and Labor Act (EMTALA) at section 1867 of the Act
• Accompanying regulations in 42 CFR § 489.24
• Related requirements at 42 CFR § 489.20(l), (m), (q), and (r)

For Medicare-participating hospitals with emergency departments, EMTALA:

• Requires, among other things, them to offer a medical screening exam to anyone who comes to the emergency department and requests such an exam
• Prohibits them from refusing to examine or offer stabilizing treatment to anyone with an emergency medical condition (EMC)

Appendix V of the State Operations Manual (SOM) gives more guidance about EMTALA’s requirements.

REH CoPs are set forth in Subpart E of 42 Code of Federal Regulations (CFR) Part 485 and establish, among other requirements, a full range of health and safety standards specific to:

• Governance
• Services offered
• Staffing
• Physical environment
• Emergency preparedness

REH policies mostly align with current hospital and Ambulatory Surgical Center (ASC) standards, like policies for outpatient service requirements and the Life Safety Code (LSC), respectively. 

The REH survey process is outlined in Appendix O. 

What facilities are eligible to be a REH?

If they were enrolled and certified to participate in Medicare as of December 27, 2020, these types of facilities are eligible to convert to a REH:

• CAHs
• A subsection (d) hospital (as defined in section 1886(d)(1)(B) of the Act) with not more than 50 beds located in a county (or equivalent unit of local government) in a rural area (as defined in section 1886(d)(2)(D) of the Act) (referred to as rural hospital)
• A subsection (d) hospital (as so defined) with not more than 50 beds that was treated as being located in a rural area pursuant to section 1886(d)(8)(E) of the Act (referred to as rural hospital)

Facilities enrolled as CAHs or rural hospitals with not more than 50 beds as of December 27, 2020 that closed after that date, are also eligible to seek REH designation if they re-enroll in Medicare and meet all REH CoPs and requirements.

How do REHs enroll in Medicare?

Like all other providers and suppliers, REHs must enroll in Medicare to be paid for services and items furnished to Medicare beneficiaries. The purpose of provider enrollment is to help confirm that providers and suppliers seeking to bill Medicare meet all applicable federal and state requirements.

The final REH enrollment regulation at 42 CFR § 424.575 states that to enroll as an REH, eligible facilities must submit a change of information application, instead of an initial enrollment application. We hope to reduce provider burden by asking facilities to convert to an REH instead of submitting an initial provider enrollment application.

To enroll as an REH, facilities must:

• Complete the Form CMS- 855A, change of information application (see section 1)
• Submit the completed application to their designated Medicare Administrator Contractor (MAC) for review and approval
• Submit additional information for conversion to an REH, including an action plan for starting REH services, along with other information, outlined in QSO memo 23-07

The MAC will review the change of information application and forward the recommendation of approval to the designated State Agency (SA).

For more details about REH enrollment policies, see Chapter 10, Medicare Enrollment, of the Medicare Program Integrity Manual.

Where can REHs get technical assistance?

The Health Resources and Services Administration’s (HRSA) Rural Emergency Hospital Technical Assistance Center offers technical assistance for REHs. The purpose of the technical assistance center is to:

• Make sure rural hospitals and the communities they serve have the information and resources they need to make informed decisions about whether an REH is the best care model for their communities
• Facilitate successful implementation of REH requirements for facilities converting to this new provider type