ACUTE CARE, INC. Supports Series – Iowa Hospital Association’s Rural Reform Proposal

ACUTE CARE, INC. Supports Series – Iowa Hospital Association’s Rural Reform Proposal

November 12, 2020

This is the first in a weekly series of articles, discussing key healthcare resources and initiatives that ACUTE CARE, INC. supports.
We will be explaining our rationale for that support, along with ways that you and your organization can join us in that effort.

For our inaugural post, we have chosen the Iowa Hospital Association’s Rural Reform Proposal

The reform proposal includes three elements

1. Create a new hospital designation – Rural Emergency Hospital, which is summarized as “A Rural Emergency Hospital (REH) would provide emergency room, outpatient care, observation care, diagnostic, therapeutic and other outpatient services currently offered by a CAH with the exception of inpatient care.”

2. Critical Access Hospitals (hereafter CAH), which is summarized as “The purpose of this policy would be to stabilize the financial viability of CAHs”.

3. Infrastructure Funding, which is summarized as “To allow hospitals to transition to a smaller and/or more efficient facility, hospitals may apply for one-time capital/infrastructure funding.”

We have chosen to focus on the first element, the Rural Emergency Hospital (hereafter, REH) concept.

As noted above, ACUTE CARE, INC. supports the Rural Reform Proposal in total. The reason that we chose to comment further on the REH component is based on context and history.

Several years ago, two concurrent events laid the groundwork for ACUTE CARE, INC.‘s interest in, and support for, the REH concept.

In 2017 Senators Grassley (R-IA) and Klobuchar (D-MN) introduced the Rural Emergency Acute Care Hospital (REACH) Act (

The bill was similar in intent to the REH proposal outlined above. From the press release:

The bill wouldn’t force any new requirements on hospitals. It simply would offer them a new option. The hospitals would have to maintain some protocols in exchange for removing inpatient services, such as being able to rapidly move a patient to a larger hospital elsewhere that offers more services.

ACUTE CARE, INC. advocated for the bill, but it never garnered sufficient support to make it to the Senate floor.

A bit before the REACH Act was proposed, Freestanding Emergency Centers started appearing in Texas, and soon spread to other states (most often states without a robust Certificate of Need law). It wasn’t long before it became apparent that the model, with some key modification, might be a match for a rural health center that either replaced an existing Critical Access Hospital or was built where a failed CAH had left the community without essential health services.

The November 2016 issue of the Rural Monitor included an article entitled Freestanding Emergency Departments: An Alternative Model for Rural Communities, which included this excerpt:

The FSED is one of several models that have been proposed to help rural communities affected by or at-risk of hospital closure. In a June 2016 report, the Medicare Payment Advisory Committee (MedPAC) proposed changing regulations and providing funding that would allow failing CAHs to convert to FSEDs. The report suggests providing fixed stipends or grants to cover standby costs and a potential requirement for the local community to provide matching funds.

Sedona has shown that the FSED can work in a rural community with the right mix of patient volume, outpatient services, and support from the community.

The context for these initiatives was explained in a Vox article entitled 1 in 4 rural hospitals is vulnerable to closure, a new report finds.

A new report from the Chartis Center for Rural Health puts the situation in dire terms: 2019 was the worst year for rural hospital closures this decade, with 19 hospitals in rural America shutting their doors. Nearly one out of every four open rural hospitals has early warning signs that indicate they are also at risk of closing in the near future.

The basis and rationale for the proposal is well known, easily understood, and of the utmost importance in preserving the healthcare safety net for those of us living in and serving rural America.

ACUTE CARE, INC. supports the IHA Rural Reform Proposal, and encourages you to do the same.

The Iowa Hospital Association could use your support. To be clear, this is a proposal with national implications. You need not be from Iowa to add your voice to those who believe that this proposal has merit.

Thankfully, the IHA has provided some useful resources.

Although legislators at the state and federal level have already voiced their support for this proposal, IHA is counting on member hospitals to continue sharing the importance of rural health care in their communities. Below are resources available with more details on the proposal as well as media content that can be used to encourage continued support from legislators.

Paul Hudson, FACHE
Chief Operating Officer