Rural Community Hospital Demonstration (RCHD) provides lifeline to rural communities
BURLINGTON, VT — U.S. Senator Peter Welch (D-Vt.), a member of the Senate Finance Subcommittee on Health Care, shared that over a dozen rural hospital leaders from Vermont and across the United States are praising the Senate’s unanimous passage of the Rural Community Hospital Demonstration Reauthorization Act, bipartisan
legislation supported by Senator Welch and led by U.S. Senators Chuck Grassley (R-Iowa) and Michael Bennet (D-Colo.), to extend the Rural Community Hospital Demonstration (RCHD) for five years.RCHD provides a lifeline to rural hospitals by allowing them to test innovative hospital payment models under Medicare that boost financial sustainability to maintain and improve health care access in rural communities across the country. Vermont’s Brattleboro Memorial Hospital is one of the thirty hospitals across the country chosen for this demonstration program.
“America’s rural hospitals are essential to ensuring that every community can access lifesaving care close to home. But rural hospitals in Vermont and across the country are operating on razor thin margins—workforce shortages and rising costs only scratch the surface of the challenges they face,” said Senator Welch. “I’m thankful for the Senate’s unanimous support of this legislation which is so essential to ensuring to our hospitals can continue to provide vital care to rural patients in Vermont and across the country.”
The most recent performance data found participating RCHD hospitals significantly improved their Medicare margins and had higher capital investments, resulting in stronger financial conditions and helping with staff retention. Participating hospitals are mostly paid using a reasonable cost-based methodology instead of the inpatient prospective payment system.
The bipartisan, bicameral Rural Community Hospital Demonstration Reauthorization Act provides a lifeline to rural hospitals by allowing hospitals to continue testing innovative hospital payment models under Medicare that boost financial sustainability and improve rural access to care. In addition to Vermont, twelve other states have hospitals in the program: Colorado, Alaska, Iowa, Kansas, Maine, Mississippi, Nebraska, New Mexico, Oklahoma, Oregon, South Dakota, and Wyoming.
Vermont Association of Hospitals and Health Systems (Michael Del Trecco, President and CEO): “Rural community hospitals are the backbone of healthcare access in many regions, and in Vermont our families, friends, and neighbors depend on having care close to home. This Senate and House bill recognizes the importance of sustaining these essential institutions so patients can continue to receive high-quality care in the communities where they live.”
American Hospital Association (Lisa Kidder Hrobsky, Senior Vice President for Advocacy and Political Affairs): “The American Hospital Association applauds the Senate passing the Rural Community Hospital (RCH) Demonstration Reauthorization Act, which allows hospitals to continue providing essential care in their communities by supporting the financial stability of participating rural hospitals. Hospitals with 50 beds or less are some of the most vulnerable to closure, and the RCH demo offers an important model to maintain access in rural communities around the country. This bipartisan legislation gives more certainty for America’s rural hospitals.”
Alaska Hospital & Healthcare Association (Jared C. Kosin, President and CEO): “AHHA supports the straightforward, five-year extension of the RCH Demonstration program and is grateful for its passage in the Senate. The financial stability the program provides has been vital to Alaska’s participating hospitals in bolstering their ability to maintain local access to healthcare and emergency services across their communities and regions.”
Iowa Hospital Association (Chris Mitchell, President and CEO): “The Rural Community Hospital Demonstration has been critical in supporting financial viability for participating Iowa hospitals, as well as preserving access to care for patients in communities with few, or no, nearby care options. The program’s structure provides stability hospitals need to plan effectively for the future and continue to serve Medicare patients close to home. Extending the program for another five years will build upon a proven model that benefits rural patients, providers as well as the Medicare program. I’m glad the U.S. Senate recognizes the importance of this program and passed legislation swiftly to extend it.”
Kansas Hospital Association (Chad Austin, President and CEO): “Access to care in rural Kansas depends on maintaining stable and sustainable financing pathways for community hospitals. The Rural Community Hospital Demonstration Program has helped participating hospitals continue delivering essential services close to home while supporting the health and economic vitality of their communities. Kansas hospitals appreciate the U.S. Senate’s passage of legislation to renew this long-standing program for an additional five years. This extension will help provide continued stability for participating hospitals in Kansas and beyond and the patients and communities they serve for years to come.”
Lakes Regional Healthcare (Jason Harrington, President and CEO): “The Rural Community Hospital Demonstration (RCHD) program has been critically important to the sustainability of Lakes Regional Healthcare in Spirit Lake, Iowa. Through participation in the RCHD, Lakes Regional Healthcare has been able to maintain financial stability, reinvest in our facility, recruit and retain essential staff, and continue offering high-quality care close to home. The hospital serves as both a critical health care provider and a key economic anchor. Reauthorization of the RCHD is essential to ensuring that hospitals like Lakes Regional Healthcare can continue to meet the growing needs of our Medicare population and the communities we serve. I’m grateful to see the U.S. Senate quickly pass the Rural Community Hospital Demonstration Reauthorization Act to extend this critical program and I thank Senator Grassley for his leadership on this legislation.”
Maine Hospital Association (Jeffrey Austin, President): “Maine is one of the oldest and most rural states in the nation. Access to care is a challenge and getting more difficult as the growth in costs exceed the growth in revenues. Maine hospitals need creative solutions to this issue. The Rural Community Hospital Demonstration program has helped stabilize the finances for participating Maine hospitals. We wholeheartedly support its reauthorization and its continued support for rural Maine.”
Nebraska Hospital Association (Jeremy Nordquist, President and CEO): “The goal of keeping our rural hospitals and the critical services they provide open and accessible demands collaboration from lawmakers, providers, and local communities. It also requires the utilization of innovative models to sustain rural health care services. That is why the Nebraska Hospital Association is grateful to the Senate for supporting the Rural Community Hospital Demonstration (RCHD) program. The loss of this program would threaten hospital stability, leading to service line cuts or closures. Participation in the RCHD keeps certain rural hospitals from falling through the cracks, helping them remain open to serve rural beneficiaries.”
In addition to Senators Welch, Grassley, and Bennet, the legislation is cosponsored by Senate Finance Committee Chairman Mike Crapo (R-Idaho) and Ranking Member Ron Wyden (D-Ore.), as well as Sens. Dan Sullivan (R-Alaska), Ben Ray Luján (D-N.M.), Cindy Hyde-Smith (R-Miss.), Jerry Moran (R-Kan.), Angus King (I-Maine), Lisa Murkowski (R-Alaska), Jeff Merkley (D-Ore.), Pete Ricketts (R-Neb.), Martin Heinrich (D-N.M.), James Lankford (R-Okla.) and John Hickenlooper (D-Colo.).
U.S. Representatives Randy Feenstra (R-IA-04), Jared Golden (D-ME-02), Rep. Mike Flood (R-NE-01), and Janelle Bynum (D-OR-05) introduced companion legislation in the House.
Read and download the full text of the bill.
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