Rural Health Policy

Regulatory Review

The Federal Office of Rural Health Policy is charged in Section 1102(b) of the Social Security Act with advising the Secretary of the U.S. Department of Health and Human Services on the effect that federal health care policies and regulations may have on rural communities. Monitoring current and proposed changes, including programs established under titles XVIII and XIX (Medicare and Medicaid), FORHP analyzes their impact on the financial viability of small rural hospitals and clinics, on the ability of rural areas to attract health professionals, and on rural areas’ access to high quality care.

Data collection and analysis is essential to understanding the challenges in rural communities, how those communities are impacted by policy, and setting policy for the future. For this reason, the work of the Rural Health Research Centers informs that of FORHP’s policy team and vice versa.

Policy Updates

December 13

Nominations: Advisory Committee on Heritable Disorders in Newborns and Children – January 4.  HRSA’s Maternal and Child Health Bureau (MCHB) is seeking nominations one position in 2019 and four in 2020.  The committee advises the U.S. Department of Health & Human Services on policy to programs to reduce morbidity and mortality in newborns and children  having, or at risk for, heritable disorders. They are seeking nominees who are 

  • medical, technical, or scientific professionals with special expertise in the field of heritable disorders or in providing screening, counseling, testing, or specialty services for newborns and children with, or at risk for having, heritable disorders; 
  • individuals with expertise in ethics (e.g., bioethics) and infectious diseases and who have worked and published material in the area of newborn screening;
  • members of the public having special expertise about, or concern with, heritable disorders; and/or
  • representatives from such federal agencies, public health constituencies, and medical professional societies.

Interested applicants may self-nominate or be nominated by another individual or organization. 


Rural Hospitals Perform Well Overall in Latest CMS Quality Results. Recently, the Centers for Medicare & Medicaid Services (CMS) published the fiscal year FY 2019 results for the Hospital Value-Based Purchasing Program (VBP). The Hospital VBP adjusts what Medicare pays hospitals under the Inpatient Prospective Payment System (IPPS) based on the quality of inpatient care the hospitals provide to patients. On average, rural hospitals performed better in the Safety, Person and Community Engagement, and Efficiency and Cost Reduction domains. For FY 2019, the average Total Performance Score (TPS) across all rural hospitals of 42.4 was greater than the national average TPS of 38.1.

December 6

Comments Requested: Reducing Burden Relating to Use of Health IT and EHRs – January 28.  Per the requirements of the 21st Century Cures Act of 2016, the U.S. Department of Health and Human Services seeks comment on a draft plan of action to reduce regulatory and administrative burden relating to the use of health IT and Electronic Health Records (EHRs).  The goals outlined intend to reduce the effort and time to record information in EHRs during care delivery; reduce the effort and time required to meet regulatory reporting requirements; and improve the functionality of EHRs.   Stakeholders reported at listening sessions that small and rural hospitals face the highest hurdles in electronic reporting, as they are most resource-challenged.  The proposed action plan seeks to minimize those burdens.

November 29

Rural Community Hospital Demonstration Report to Congress.  In October, the CMS Innovation Center published the Report to Congress on the progress of the Rural Community Hospital Demonstration, which began in 2005 per the Medicare Modernization Act of 2003 and has been re-authorized twice since.  The demonstration examines the effect of an alternative payment methodology for inpatient hospital services in small rural community hospitals with fewer than 51 beds that are not eligible to be Critical Access Hospitals.  Over a 12-year period, 33 hospitals participated at some point, and the demonstration increased payments on a per hospital, per year basis by 41 percent during fiscal year (FY) 2005-2009 and 42 percent during FY 2011-2013.

Comments Requested: Proposed Drug Pricing Changes for Medicare Advantage (MA) and Part D Plans – January 25.  CMS solicits public comments on potential Medicare policies intended to lower costs for beneficiaries and to provide MA and Part D plans with tools to lower the cost of prescription drugs.  Proposals include requiring Part D Explanation of Benefit statements to list drug pricing information, restricting Part D plans from prohibiting or penalizing a pharmacy from disclosing a lower cash price to an enrollee, and redefining the negotiated price paid to pharmacies.  Rural pharmacies report HRSA Exit Disclaimer that payments from Part D plans are a major concern that affect their financial viability.

November 21

CMS Report on Telehealth in Medicare. Last week, the Centers for Medicare & Medicaid Services (CMS) published a report to Congress detailing the state of telehealth in the Medicare program. The report has four areas of focus: 1) Medicare beneficiaries whose care would benefit the most from telehealth expansion; 2) activities by the Center for Medicare and Medicaid Innovation that increased access to telehealth; 3) the types of high-volume services suitable for telehealth;  and 4) barriers that might prevent the expansion of telehealth. CMS found that, overall, telehealth utilization among Medicare-fee-service beneficiaries has increased, though services have primarily focused on the needs of rural beneficiaries. 

November 15

Scope of Practice Policies for Clinicians by State. HRSA Exit Disclaimer The National Conference of State Legislatures provides this interactive map to educate state policymakers about scope of practice issues for behavioral health providers, nurse practitioners, oral health providers and physician assistants.  The site features an in-depth look at three professions that are essential for recovery from opioid misuse: peer support specialists, licensed professional counselors, as well as nurse practitioners and physician assistants who can prescribe buprenorphine-containing products. While more than 60% of rural counties lack a physician with a waiver to prescribe buprenorphine, rural communities tend to have more providers like these (PDF - 103 KB), who require fewer years of education and training. 

CMS Releases 2017 Quality Payment Program Results. The Centers for Medicare & Medicaid Services (CMS) recently released performance information from the first year of the Quality Payment Program (QPP). Results show rural practices performed well in the QPP’s Merit-based Incentive Payment System (MIPS). Overall, 93 percent of rural practices earned positive payment adjustments, including 65 percent who earned additional adjustments for exceptional performance. CMS continues to offer options to help rural and small practices participate in the QPP, including no-cost, customized technical assistance and the opportunity to participate in MIPS through the virtual group option.

Comments Requested:  Proposals for Medicaid and CHIP Managed Care Regulations – January 14.  In response to stakeholder feedback, CMS proposes to revise and streamline the final rule on Medicaid and Children’s Health Insurance Program (CHIP) managed care published in 2016.  Of interest to rural stakeholders and State Offices of Rural Health are proposals to allow states flexibility in establishing network adequacy standards, to change requirements for quality reporting systems, and to revise requirements for the dissemination of information to enrollees. 
Medicaid Guidance for Expanding Behavioral Health.  CMS issued a letter to State Medicaid Directors outlining opportunities to design innovative service delivery systems for Adults with a Serious Mental Illness or Children with a Serious Emotional Disturbance using strategies already available under current authority and strategies available through 1115 demonstration waivers.  For example, improving access to mental health services in schools could include partnerships with Federally Qualified Health Centers (FQHCs) and Rural Health Clinics or reimbursement of school-based providers through managed care plans.  Medicaid is an important source of health insurance in rural areas HRSA Exit Disclaimer covering almost one-quarter of non-elderly rural individuals.

November 8

Comments Requested: Expanding Telehealth for Substance Use Disorder Treatment – December 31. As part of the Medicare Physician Fee Schedule and Quality Payment Program final rule, CMS incorporated an Interim Final Rule to implement part of the SUPPORT of Patients and Communities Act addressing Medicare telehealth provisions. This includes removing the originating site geographic requirements and adds the home as an originating site for the treatment of a substance use disorder or co-occurring mental health disorder on or after July 1, 2019. Additionally, the SUPPORT for Patients and Communities Act establishes a new Medicare benefit category for opioid use disorder treatment services furnished by opioid treatment programs (OTP) under Medicare Part B, beginning on or after January 1, 2020.

Medicare Clinician Payment Policies Finalized. On November 1, CMS finalized updates to Medicare’s payment of clinicians for calendar year 2019 under the Physician Fee Schedule (PFS) and the Quality Payment Program (QPP). Highlights under the PFS for rural providers include 

  • new virtual communication services billable by clinicians and RHCs/FQHCs,
  • two new telehealth codes for prolonged preventive services,
  • telehealth updates for ESRD and acute stroke,
  • practice flexibility for radiologist assistants, and
  • updates to evaluation and management payment in 2021 and documentation in 2019.

Updates to the QPP’s Merit-Based Incentive Payment System (MIPS) include

  • an expansion of eligible clinician types (physical therapists, occupational therapists, qualified speech-language pathologists, qualified audiologists, clinical psychologists, and registered dieticians or nutrition professionals),
  • a new element added to the low-volume threshold (200 covered professional services under the PFS),
  • an opportunity for eligible clinicians to opt-in to MIPS,
  • updates to health IT policies to promote interoperability, and
  • an increased contribution of cost to the overall MIPS score (15 points).

The final rule also covers some provisions related to the Medicare Shared Savings Program including a reduction in the number of quality measures and a six-month extension for existing ACOs with participation agreements expiring on December 31.

CMS Delays Finalizing Revisions to Requirements for Discharge Planning for Hospitals, Critical Access Hospitals, and Home Health AgenciesOn November 3, 2015, CMS published a proposed rule, “Medicare and Medicaid Program; Revisions to Requirements for Discharge Planning for Hospitals, Critical Access Hospitals (CAHs), and Home Health Agencies (HHAs)” that would update the discharge planning requirements for hospitals, CAHs, and HHAs and implement the discharge planning requirements of the IMPACT Act of 2014 (Pub. L. 113-185).  In general, CMS must finalize Medicare rules within 3 years; however, CMS needs more time to address issues raised by public comments in the proposed rule.  Therefore, CMS is extending the timeline for publication of the final rule until November 3, 2019.  

Medicare Outpatient Payment Policies FinalizedOn November 2, CMS finalized updates to the Medicare Outpatient Prospective Payment System (OPPS) and Ambulatory Surgical Care Center (ASC) Payment System for 2019.  In addition to updating payment rates, the rule continues the 7.1 percent adjustment to OPPS payments for certain rural Sole Community Hospitals (SCHs), including Essential Access Community Hospitals (EACHs). It finalizes a method to control increases in hospital outpatient department services by applying a Physician Fee Schedule (PFS)-equivalent payment rate for the clinic visit service when provided at an off-campus provider-based department (PBD) that is paid under the OPPS.  It also removes nine quality measures from the ASC and hospital outpatient department quality reporting programs.   

CMS Updates Home Health Payments and Policy –  CMS displayed its final rule for calendar year (CY) 2019 updates to payment rates and rules for home health agencies.  Over 1,100 comments were received on the proposed rule. In addition to a payment rate increase of 2.2 percent ($420 million), which rural areas will experience as 2.4, the final rule makes changes to the methodology for rural add-on payments mandated by statute, proposes case-mix methodology refinements to be implemented for home health services beginning January 1, 2020, and changes the unit of payment from 60-day episodes of care to 30-day periods of care. Also of interest for rural areas, CMS updated the definition of remote patient monitoring which can now be included as an allowable operation expense; changed requirements for accrediting organizations to ensure access to and burden reduction for small or rural non-certified providers and suppliers; and established health safety standards and transitional payment for qualified home infusion therapy suppliers.

CMS Updates Dialysis and Durable Medical Equipment Payments and Policy – CMS displayed its final rule for calendar year (CY) 2019 updates to payment rates and rules for providers of dialysis services and durable medical equipment. Over 150 comments were received on the proposed rule. In addition to a payment rate increase of 1.3 percent for providers of dialysis, the final rule also makes updates to the competitive bidding program (CBP) for Durable Medical Equipment, Prosthetics, and Oxygen Suppliers (DMEPOS). CMS finalized an increase in DMEPOS fee schedule rates using a blend of adjusted and unadjusted fee amounts to protect access to needed durable medical equipment in rural areas that are not subject to the DMEPOS CBP. Rural providers of dialysis for end-stage renal disease will experience the payment increase as the full 1.3 percent, and rural providers of dialysis for acute kidney injury will experience the payment increase as 1.0 percent.

November 1

Comments Requested:  Implementing Provisions of the Bipartisan Budget Act (BBA) of 2018 – December 31.  The Centers for Medicare & Medicaid Services (CMS) seeks comments on several proposals to improve quality and access to care in the Medicare Advantage (MA) and Prescription Drug Programs by implementing provisions from the BBA of 2018.  For example, the BBA allows MA plans to offer “additional telehealth benefits” not otherwise available in Original Medicare starting in 2020.  CMS proposes to give MA plans more flexibility in how they pay for “additional telehealth benefits” to satisfy this provision. By allowing services such as such as live-interactive videoconferencing and remote monitoring, telehealth connects rural providers and their patients to services at a distant site.  CMS also solicits comment on how to implement the statutory provision that if an MA plan covers a Part B service as an “additional telehealth benefit,” then the MA plan must also provide the enrollee access to such service through an in-person visit.  Comments can be submitted through by December 31.

Comments Requested: Medicare Part B Drug Pricing – December 31  Last week, CMS issued an Advanced Notice of Proposed Rulemaking (ANPRM) seeking comment on potential options for testing changes to payment for certain separately payable Part B drugs and biologicals.  Among the questions CMS is seeking feedback on is the potential approach to selecting geographic areas for the intervention and comparison groups in the model, and whether particular regions of the country would need adjustments or exclusions from the model (for example, rural areas).

October 11

Evaluating the Bundled Payment for Care Improvement (BPCI) Initiative.  CMS released the fifth evaluation report for the BPCI Initiative, which tests whether linking payments for all providers that furnish Medicare-covered services during an episode of care related to an inpatient hospitalization can reduce expenditures while maintaining or improving quality of care.  For Model 2, the most comprehensive model, 8 percent of hospitals initiating episodes were in rural areas.  Rural participants reported challenges with scarcity of potential partners (e.g., primary care physicians, specialists, and community services); lack of knowledge of programs such as BPCI among providers; and limited internal staffing resources.  However, they also reported that being a rural provider did not affect their ability to collaborate with post-acute care providers because they had developed relationships or collaborative efforts prior to BPCI.  The Innovation Center also announced participants to the new BPCI-Advanced Model.  

October 4

GAO Report on Rural Hospital Closures. In response to a request from Congress, the US Government Accountability Office (GAO) analyzed how the Department of Health and Human Services supports and monitors rural hospitals' financial viability and rural residents' access to hospital services as well as the characteristics of rural hospitals that have closed in recent years.  From 2013 to 2017, 64 rural hospitals closed, more than twice as many as during the previous 5-year period.  Closures disproportionately occurred in the South, among for-profit hospitals, and among Medicare Dependent Hospitals—small rural hospitals with Medicare beneficiaries accounting for a certain percentage of their business.  Financial distress was the primary reason for closure, with multiple factors exacerbating the distress, including a decrease in patients seeking inpatient care and across-the-board Medicare payment reductions.

Hospital Readmission Reduction Program Changes for Safety Net Hospitals. As of October 1, 2018, CMS began a new methodology to assess hospital performance under the Hospital Readmission Reduction Program (HRRP), which reduces payments to inpatient prospective payment system (IPPS) hospitals with excess readmissions.  The new method evaluates hospital performance relative to other hospitals with similar proportions of patients that are dually eligible for Medicare and full-benefit Medicaid.  Critical Access Hospitals HRSA Exit Disclaimer are exempt from the HRRP, but tracking readmissions in CAHs is an area of focus of the Medicare Beneficiary Quality Improvement Project (MBQIP)HRSA Exit Disclaimer

September 27

Updated Survey and Certification Procedures for Hospitals with Swing Beds. The Centers for Medicare & Medicaid Services (CMS) recently updated the Appendices in the State Operations Manual (SOM) to reflect revisions to the regulations and guidelines for survey procedures for hospitals and critical access hospitals (CAHs) that operate swing beds. They updated Appendix A, Survey Protocol, Regulations and Interpretive Guidelines for Hospitals, and Appendix W, Survey Protocol, Regulations and Interpretive Guidelines for CAHs and Swing Beds in CAHs, to reflect significant revisions to the Survey Protocol and deleted Appendix T.  These revised policies are effective immediately.  

September 20

NQF Final Report:  Rural-Relevant Measures for Healthcare Quality. HRSA Exit Disclaimer  The National Quality Forum (NQF) released their first set of quality measures for rural hospitals and ambulatory care facilities to improve quality of care and access in rural areas. The Measures Application Partnership (MAP) formed a Rural Health Workgroup that provides recommendations from a rural perspective and developed these measures.   

2018 Rural Hospital and Clinic Financial Summit Report. HRSA Exit Disclaimer The National Rural Health Resource Center, with the support of the Federal Office of Rural Health Policy, developed this report following a Summit of key rural hospital and clinic stakeholders to identify the most important financial indicators and strategies to transition to value-based payment. This report is designed to help rural hospital and clinic leaders meet this transition with financial success. 

Call for National Advisory Committee NominationsHRSA seeks nominations for new members to serve on its Health Workforce National Advisory Committees. The five committees advise the HHS Secretary and Congress on health workforce policies and programs. HRSA accepts nominations on a continuous basis and considers them as vacancies occur. You may nominate yourself or others. Professional associations and organizations may also nominate qualified candidates.  As with all of HRSA’s Federal Advisory Committees, diverse geographic representation can strengthen the work and recommendations of each group.

September 13

FCHIP Interim Report to Congress.  Since August 1, 2016, ten Critical Access Hospitals (CAHs) in Montana, Nevada, and North Dakota have participated in the Frontier Community Health Integration Project Demonstration (FCHIP) to test how changes in Medicare payment for ambulance, skilled nursing, and telehealth services affect health outcomes in sparsely populated frontier communities. Last month, FORHP and CMS released a joint report to Congress detailing the CAHs’ progress and experiences in the first year of the demonstration.   The report finds little change for ambulance or skilled nursing services while telehealth services encountered credentialing, licensing, scheduling, and other common administrative challenges. FCHIP will conclude on July 31, 2019, unless extended by Congress.  FORHP and CMS must submit a final report to Congress by July 31, 2020.

USPSTF Recommendation to Prevent Youth Substance AbuseHRSA Exit Disclaimer The U.S. Preventive Services Task Force (USPSTF) conducts rigorous evaluations of existing peer-reviewed studies to inform evidence-based recommendations about clinical preventive services, such as screenings, counseling, and other primary care services.  USPSTF released its final research plan on how primary care providers can prevent illicit and nonmedical drug use, including opioid abuse, among children, adolescents, and young adults.  Before issuing its final recommendation on these services, USPSTF will review the evidence to determine whether counseling interventions referred by primary care providers improve health outcomes and related social, educational, and behavioral outcomes.

Date Last Reviewed:  December 2018

Questions about Policy Updates?