WASHINGTON, D.C. — U.S. Representatives Eugene Vindman (D-Va.-07), James Moylan (R-Guam), and Tracey Mann (R-Kan-01) today introduced the Rural Hospital Closure Relief Act, bipartisan legislation led in the U.S. Senate by Senator Dick Durbin (D-Ill.) to help financially distressed rural hospitals remain open and maintain essential services.
Medicare’s Critical Access Hospital (CAH) program keeps care within reach for rural communities by providing cost-based reimbursement rather than standard prospective payments. But the program’s rigid mileage requirement — 35 miles from another hospital, or 15 miles in mountainous regions — often blocks hospitals that are financially vulnerable, yet still the only practical provider for entire areas. In Virginia’s Shenandoah Valley and Southside, several hospitals sit just inside the threshold but remain critical lifelines for surrounding counties.
“Too many rural hospitals are hanging on by a thread,” said Vindman. “When a hospital closes, it eliminates emergency care, wipes out jobs, destabilizes local economies, and leaves families without access to lifesaving services. No one should have to drive thirty miles in an emergency because their nearest hospital was shut down. States need the ability to step in before it’s too late, and this legislation gives them the tools to do exactly that.”
“Rural communities rely on their local hospitals for timely, dependable care,” said Mann. “The sad reality is that too many facilities are struggling to serve patients effectively due to rising costs and falling reimbursements. The Rural Hospital Closure Relief Act gives vulnerable hospitals the tools they need to keep their doors open and keep essential services available to Americans in rural areas. Every American should have access to quality, affordable health care regardless of their zip code.”
“Rural hospitals serve as the backbone of this country. Guam, which is 100% rural, knows all too well the financial strain placed on our healthcare system,” said Moylan. “That’s why I’m proud to co-lead the Rural Hospital Closure Relief Act with Rep. Vindman and Rep. Mann, which provides the relief hospitals need to continue saving lives and updates Medicare policy to reflect the realities of delivering care in remote areas. This legislation is essential to ensuring that States and Territories have the tools necessary to empower our hospitals.”
The Rural Hospital Closure Relief Act is endorsed by the National Rural Health Association and Virginia Rural Health Association.
Specifically, the Rural Hospital Closure Relief Act would:
- Allow states to certify certain rural hospitals as “necessary providers” and waive the mileage rule for CAH status when financial distress and community need are demonstrated,
- Limit designations to 120 hospitals nationwide and no more than five per state over a nine-year period,
- Require hospitals to show two years of operating losses, a solvency plan, and a commitment to maintain or expand a high-demand service line such as OB or behavioral health,
- Direct GAO and MedPAC to assess program impacts on hospital stability, patient access, and Medicare costs,
- Allow the U.S. territories to use CAH designations and waive the bed requirement, and
- Sunset the program after nine years with transition mechanisms for hospitals.
BACKGROUND
From 1997 to 2006, states could designate “necessary providers” and waive the mileage requirement for CAH status, but that authority expired nearly two decades ago. The Rural Hospital Closure Relief Act reinstates a targeted, accountable version of that flexibility with modern safeguards to protect Medicare and ensure designations are reserved for hospitals most at risk.
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