
Critical Access Hospitals (CAHs) are healthcare facilities that provide essential emergency, inpatient, and outpatient care to rural, underserved communities. They are designated by the Centers for Medicare and Medicaid Services (CMS) and must adhere to specific federal criteria, such as having no more than 25 inpatient beds and maintaining an average length of stay of 96 hours or less. CAHs play a crucial role in maintaining public health by offering accessible and affordable healthcare to individuals in rural areas, who may otherwise face challenges in accessing medical services. These hospitals often face their own challenges, including staffing shortages and financial constraints, and they receive support through federal programs and initiatives aimed at improving quality and financial stability.
| Characteristics | Values |
|---|---|
| Definition | Medical centers that provide healthcare services to rural, underserved communities |
| Number of CAHs in the U.S. | 1,343-1,353 |
| States without CAHs | Connecticut, Delaware, Maryland, New Jersey, and Rhode Island |
| Number of beds | No more than 25 beds |
| Average duration of hospital stay | Under 96 hours |
| Distance from another hospital | More than 35 miles away |
| Staffing | More flexibility in staffing requirements |
| Physician availability | On-call physician available to be on-site within 60 minutes |
| Nurse practitioner availability | Available for immediate contact by phone or radio |
| Equipment and medications | All essential equipment and medications must be available |
| Patient transport | Agreements in place with larger hospitals for patient transport |
| Funding | Receive federal funding and participate in the 340B drug pricing program |
| Services offered | Essential emergency, inpatient, and outpatient care |
| Financial viability | Improved financial viability through enhanced reimbursements |
| Quality improvement | Participation in federal quality improvement initiatives like MBQIP and Flex programs |
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What You'll Learn
- Critical Access Hospitals (CAHs) are designated by the Centers for Medicare and Medicaid Services (CMS)
- CAHs must adhere to federal guidelines, including location in a rural area
- CAHs must have no more than 25 beds with an average stay under 96 hours
- CAHs are exempt from the prospective payment system (PPS) and receive cost-based reimbursements
- CAHs can access the 340B Drug Pricing Program for reduced-cost medications

Critical Access Hospitals (CAHs) are designated by the Centers for Medicare and Medicaid Services (CMS)
Critical Access Hospitals (CAHs) are designated healthcare facilities that are exempt from the prospective payment system (PPS). They receive cost-based reimbursement for most inpatient and outpatient Medicare services. CAHs are a type of rural hospital designated by the Centers for Medicare and Medicaid Services (CMS). These hospitals are important because they offer more affordable, accessible healthcare to individuals in rural areas.
CAHs are typically small hospitals in rural areas that serve residents who would otherwise be a long distance from emergency care. They provide essential emergency, inpatient, and outpatient care, often facing challenges like staffing shortages and financial constraints. They play a critical role in maintaining public health by delivering accessible healthcare and supporting local economies in rural regions.
To receive federal funding, CAHs must adhere to several guidelines. They may have no more than 25 acute care inpatient beds and must have an average duration of hospital stay of 96 hours or less. They must also be more than 35 miles from another hospital, with exceptions for areas with poor roads or difficult terrain. CAHs have more flexibility in staffing requirements and may have a physician on-call available to be on-site within 60 minutes.
CAHs are eligible for various federal programs and initiatives, such as the 340B Drug Pricing Program, which allows them to purchase medications at reduced costs. They can also benefit from initiatives like the SHIP program, a federal grant program administered by the Wisconsin Office of Rural Health, which aims to improve the quality of care in rural hospitals. CAHs play a vital role in ensuring quality healthcare is accessible to underserved communities in rural areas.
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CAHs must adhere to federal guidelines, including location in a rural area
Critical Access Hospitals (CAHs) are healthcare facilities designated by the Centers for Medicare and Medicaid Services (CMS) that adhere to federal guidelines and are located in rural areas. CAHs aim to improve access to healthcare services for underserved communities in these areas. To receive federal funding, CAHs must follow specific criteria, including being located in a rural area, offering no more than 25 inpatient beds, and maintaining an average length of stay for patients of no more than 96 hours.
CAHs are essential in providing emergency, inpatient, and outpatient care to individuals who would otherwise face long distances to receive medical attention. They play a crucial role in maintaining public health and supporting local economies in rural regions. The designation of CAH helps reduce the financial vulnerability of these hospitals by providing benefits such as cost-based reimbursement for Medicare services. This designation also allows CAHs to participate in the 340B Drug Pricing Program, where pharmaceutical companies are legally required to subsidise a portion of the medications used by these hospitals.
CAHs must also meet certain staffing requirements, although they have some flexibility in this regard. They are required to have a physician on-call who can be on-site within 60 minutes. In some cases, a Doctor of Medicine, physician assistant, nurse practitioner, or clinical nurse specialist may be available for immediate contact by phone or radio. CAHs with 10 or fewer beds may have a registered nurse with emergency care training fulfil the role of the on-call physician.
To maintain their designation, CAHs must adhere to federal guidelines and continuously work towards quality improvement. The Wisconsin Office of Rural Health's Flex Program, for example, assists CAHs in Wisconsin with quality improvement activities, including program planning, data management, and best practice development. CAHs are vital in ensuring that individuals in rural areas have access to affordable and convenient healthcare, which is crucial in addressing the higher incidence of poverty and preventable illnesses in these communities.
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CAHs must have no more than 25 beds with an average stay under 96 hours
Critical Access Hospitals (CAHs) are healthcare facilities that provide essential emergency, inpatient, and outpatient care to rural, underserved communities. These hospitals are designated by the Centers for Medicare and Medicaid Services (CMS) and are exempt from the prospective payment system (PPS). CAHs are important because they offer affordable and accessible healthcare to rural residents, who are more likely to face poverty and are more susceptible to preventable illnesses.
To receive federal funding and maintain their designation, CAHs must adhere to several guidelines. One of the key requirements is that they must have no more than 25 acute care inpatient beds, with certain exceptions. Beds designated for examination, procedures, stretchers, operating room tables, long-term care, and distinct observation do not count towards this 25-bed limit. This limit helps ensure that CAHs focus on providing essential emergency and acute care services to the communities they serve.
The average length of stay for patients in CAHs is also regulated, and it must not exceed 96 hours. This requirement ensures that CAHs prioritize providing timely care and discharging patients back to their communities promptly. The 96-hour average length of stay also aligns with the nature of services provided by CAHs, which primarily focus on essential emergency and acute care.
CAHs play a critical role in maintaining public health in rural regions. By offering accessible healthcare, they support local economies and improve the financial viability of small rural hospitals. The designation of CAHs helps reduce their financial vulnerability by providing benefits such as cost-based reimbursement for Medicare services. This reimbursement structure helps sustain core hospital services and ensures that healthcare remains accessible and affordable for rural residents.
In addition to bed limits and average length of stay regulations, CAHs must also meet other criteria, such as being located in a rural area, providing 24/7 emergency care, and having a physician available on-call within a specified timeframe. These requirements ensure that CAHs are well-equipped to serve the urgent medical needs of their communities while also maintaining the highest standards of care.
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CAHs are exempt from the prospective payment system (PPS) and receive cost-based reimbursements
Critical Access Hospitals (CAHs) are healthcare facilities that serve rural communities with limited access to medical services. They are designated by the Centers for Medicare and Medicaid Services (CMS) and must adhere to specific federal criteria to receive federal funding. CAHs play a crucial role in providing accessible and affordable healthcare to underserved populations in rural areas.
CAHs are exempt from the prospective payment system (PPS) and, instead, receive cost-based reimbursements for Medicare services. This means that their Medicare payments are based on the actual costs incurred rather than a predetermined rate. This cost-based reimbursement structure is designed to reduce the financial vulnerability of rural hospitals and ensure their sustainability. It allows CAHs to receive enhanced reimbursements, improving their financial stability and helping them maintain their operations.
The exemption from PPS and the implementation of cost-based reimbursements are significant factors in supporting CAHs. By basing Medicare payments on costs, CAHs can better manage their finances and ensure they can continue providing essential healthcare services to their communities. This reimbursement structure also incentivizes CAHs to participate in federal programs and adhere to specific guidelines, such as bed limits and average length-of-stay requirements.
CAHs face unique challenges, including staffing shortages and financial constraints. The cost-based reimbursement structure helps address these challenges by providing a more stable financial foundation. It enables CAHs to plan and allocate resources effectively, ensuring they can meet the specific needs of their rural communities. This includes offering essential emergency, inpatient, and outpatient care, as well as specialized services like radiology, laboratory services, and outpatient rehabilitation.
Additionally, CAHs can participate in the 340B Drug Pricing Program, which allows them to purchase medications at reduced costs. This further reduces their financial burden and ensures that they can provide affordable medications to their patients. The combination of cost-based reimbursements and access to discounted medications helps CAHs maintain their operations and better serve their communities.
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CAHs can access the 340B Drug Pricing Program for reduced-cost medications
Critical Access Hospitals (CAHs) are healthcare facilities located in rural areas, serving communities with limited access to medical services. They provide essential emergency, inpatient, and outpatient care, often with staffing shortages and financial constraints.
CAHs are important because they offer more affordable and accessible healthcare to individuals in these rural areas, who are more likely to face poverty and are more susceptible to preventable illnesses. To receive federal funding, CAHs must adhere to several guidelines, including having no more than 25 beds, an average hospital stay duration of under 96 hours, and being more than 35 miles from another hospital.
One of the benefits of CAHs is their access to the 340B Drug Pricing Program, which allows eligible healthcare clinics and hospitals to purchase outpatient drugs at a discount of 20-50%. This program was created to address the dramatic rise in drug prices for hospitals, which were no longer receiving voluntary discounts under the Medicaid Drug Rebate Program. The 340B program requires pharmaceutical manufacturers participating in Medicaid to sell outpatient drugs at discounted prices to healthcare organizations serving many uninsured and low-income patients.
CAHs are among the hospitals that qualify for this program, along with sole community hospitals, rural referral centers, and public and nonprofit disproportionate share hospitals. The discounted drugs can be dispensed to both uninsured patients and those covered by Medicare or private insurance. The program allows hospitals to stretch limited federal resources, reduce outpatient drug prices for patients, and expand health services to the communities they serve.
While the 340B program has grown over time, it remains a small share of drug company revenues, accounting for only 3% of their global revenues in 2022. However, it has been linked to higher drug costs for patients in some instances, as hospitals are not required to pass on savings to patients.
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Frequently asked questions
A Critical Access Hospital (CAH) is a healthcare facility that provides essential emergency, inpatient, and outpatient care to rural, underserved communities.
The Critical Access Hospital program is a United States federal program established in 1997 as part of the Balanced Budget Act. The program aims to offer small hospitals in rural areas to serve residents that would otherwise be a long distance from emergency care.
The CAH designation is designed to reduce the financial vulnerability of rural hospitals by providing certain benefits, such as cost-based reimbursement for Medicare services and access to the 340B Drug Pricing Program. The program also offers more flexibility in staffing requirements and access to grants and technical and educational resources.
To receive federal funding and the CAH designation, hospitals must adhere to several guidelines. These include having no more than 25 acute care inpatient beds, an average duration of hospital stay under 96 hours, and being more than 35 miles from another hospital. They must also offer 24/7 emergency care and have a physician available on-call within 60 minutes.











































