CMS Calls On Rural Hospitals to Join Alternative Payment Model

From RevCycleIntelligence:

CMS is seeking applicants to participate in a new round of the Rural Community Hospital Demonstration Program that tests a cost-based alternative payment model among small rural hospitals.

Lawmakers authorized a five-year extension of the demonstration under the 21st Century Cures Act. The act allowed for new applicants as well as an opportunity for previous rural hospital participants to join a second extension period if they were part of the demonstration as of the last day of the first period or Dec. 30, 2014.

The Rural Community Hospital Demonstration program first implemented the alternative payment model at rural hospitals for inpatient hospital services furnished to Medicare beneficiaries in 2004. CMS launched two other rounds in 2008 and 2010.

The alternative payment model aimed to help rural hospitals that are too large to qualify for higher Medicare reimbursement rates as a Critical Access Hospital. While the hospitals are larger, many facilities still struggled because of their size to offset lower reimbursement rates with greater patient volumes or revenue from other non-Medicare services.

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