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Congress makes New Rural Emergency Hospital Designation

The Consolidated Appropriation Act, 2021 included legislation establishing a rural emergency hospital (REH) designation under the Medicare program. The new designation will allow existing facilities to provide emergency and outpatient services without having to provide inpatient care. Emergency services must be available 24 hours a day, 365 days a year, but communities and hospitals would have flexibility to align outpatient services and post-acute services with the needs of their community. REHs will receive a fixed monthly payment for services, plus a 5% add-on to the Outpatient Prospective Payment System (PPS) rate for outpatient services. The fixed monthly payment will be 1/12th of the average annual payment critical access hospitals received in excess of the PPS for all services including inpatient, outpatient, and skilled nursing facility services in 2019. The fixed amount will be adjusted each year by the hospital market-basket update.

The full legislation is available here.

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