Durbin, Lankford, Kinzinger, Panetta Introduce Bipartisan, Bicameral Bill to Support Rural Hospitals

WASHINGTON – Today, U.S. Senate Majority Whip Dick Durbin (D-IL) and U.S. Senator James Lankford (R-OK) introduced the bipartisan Rural Hospital Closure Relief Act, which would support financially vulnerable rural hospitals facing risk of closure. The legislation would update Medicare’s “Critical Access Hospital” (CAH) designation so more rural hospitals can qualify for this financial lifeline and continue to serve their communities with quality, affordable health care services.  Small and rural hospitals are the backbone of their communities, and often the largest employers, contributing nearly $5 billion in direct spending on payroll, goods, and services in Illinois.  Yet more than 120 rural hospitals have closed nationwide in the past decade, and nearly half are operating with negative margins. The COVID-19 pandemic has exacerbated these realities—with increased costs for personal protective equipment and testing supplies, and a reduction in outpatient and elective procedures that typically account for three-quarters of hospital revenue. 

“Rural hospitals are the backbone of the communities in Illinois and across the country, providing essential access points to health care and anchoring the local economy. Yet, many grapple with financial vulnerabilities that have only increased during the pandemic, at a time that we need them most. Senator Lankford, Representatives Kinzinger and Panetta, and I are introducing this bipartisan bill to protect our rural hospitals from closing and strengthen our commitment to the communities that depend on these essential health providers,” Durbin said. 

“In some parts of Oklahoma, patients drive hours to get to the nearest hospital, and some of those hospitals are currently threatened. That is not only unsustainable; it is unsafe,” said Lankford. “This bill will help ensure that hospitals serving low-income or rural areas in my state can continue to operate and provide peace of mind to their communities. Allowing states to have flexibility to ensure quality health care where it is most needed is vital and brings decision-making power closer to home. While we continue to address health care needs during COVID, we cannot leave out our rural communities. Oklahomans should live where they please and still be able to expect access to quality health care. I look forward to getting this solution for them addressed in law.”

“Rural hospitals are critical in communities across IL-16 and the country. As we continue to battle COVID-19, we must take swift action to protect the critical healthcare infrastructure providing care in our rural communities,” said Kinzinger. “I’m pleased to have the support of my House and Senate colleagues as we work to designate these struggling rural facilities as ‘Critical Access Hospitals’ (CAHs) for the patients and communities relying on the services they provide.” 

“Our nation’s rural hospitals are bearing a big brunt of this bruising pandemic, leaving some of our communities caught in a crisis of losing their necessary critical care,” said Panetta.  “Updating the Critical Access Hospital designation through our bipartisan bill is the fix rural hospitals need to qualify for financial assistance, allowing Americans to continue relying on their local health care services.  A big part of our battle against COVID-19 is coming up with bipartisan bills like this that help our health care professionals and institutions from the central coast of California to the center of our country.”

Under CAH status, hospitals are paid a higher Medicare rate—101 percent of their actual costs, rather than set rates per service, as long as they have fewer than 25 inpatient beds; are located 35 miles from other hospitals; maintain patient length of stays less than 96 hours; and offer 24/7 emergency care. 

The Rural Hospital Closure Relief Act would support and stabilize rural hospitals by providing flexibility around the 35-mile distance requirement and enabling states to certify a hospital as a “necessary provider” in order to obtain CAH designation.  This authority ended in 2006, but today’s bill would re-open this financial lifeline for certain rural hospitals that serve a low-income community, are located in a health professional shortage area, and that have operated with negative margins for multiple years.  There are currently 51 Critical Access Hospitals in Illinois, and several rural hospitals would newly qualify under this legislation for increased Medicare payments and stabilization. 

The Rural Hospital Closure Relief Act is supported by the Illinois Critical Access Hospital Network (ICAHN), Illinois Health and Hospital Association (IHA), and National Rural Health Association (NRHA).

U.S. Representatives Adam Kinzinger (R-IL-16) and Jimmy Panetta (D-CA-20) will be introducing a companion bill in the House of Representatives.