Publication Date: January 2nd, 2004
Publication Type(s): Working Paper
Topic(s): Critical Access Hospitals, Healthcare Financing, Rural Hospital Flexibility Program
Author(s): Stenslad, J., Davidson, G., Moscovice, I.
As of November, 2003, 834 small rural hospitals have converted to Critical Access Hospital (CAH) status. A primary benefit of converting to CAH status is to receive cost-based payments (rather than prospective payments) from Medicare. The CAH program has contributed significantly to the financial viability of small rural hospitals. This is likely due to a one-time shift to cost-based reimbursement as well as behavioral changes induced by higher payment rates.