By the Office of U.S. Senator for Kansas Roger Marshall
MOUNDRIDGE, Kan. – U.S. Senator Roger Marshall, M.D. visited Mercy Hospital in Moundridge on Tuesday to learn about its transition to a Rural Emergency Hospital (REH) designation. Mercy Hospital is only the second hospital in Kansas to move to the REH model since the federal designation was created in 2021 and state regulations were finalized in 2023. Mercy Hospital administrator Aaron Herbel provided a tour of the facility to showcase the medical services that will remain to serve its patients and discuss the financial benefits of the new designation.
Mercy Hospital’s designation as a REH, effective Jan. 1, 2023, was a strategic move by the hospital board and administrative team to provide financial stability and ensure a continued presence in the community. Under the new designation, the hospital will provide 24/7 emergency medical care, laboratory testing, physical therapy, radiology, outpatient surgery, clinic services, observation services, and other outpatient services.
“I am pleased to see that Mercy Hospital has taken the initiative to transition to the new Rural Emergency Hospital model,” said Senator Marshall. “Hospital leadership was thoughtful in its consideration of the impacts of the changes but ultimately understood this new designation would provide long-term financial security. This new designation creates a more cost-effective alternative and ensures that patients will continue to have immediate access to quality care in their community.”
Mercy Hospital CEO Aaron Herbel highlighted the positive changes under the REH model, saying, “We are excited about the new services we will be able to bring to the community like a walk-in care clinic, non-emergent transportation, access to additional specialty services, and potentially home health services.”
Background:
- The Rural Emergency Hospital (REH) designation was established under the Consolidated Appropriations Act, 2021, with the full support of Senator Marshall. The state of Kansas finalized state regulations in 2023. The designation allows Critical Access Hospitals to convert into a voluntary new designation under Medicare, alleviating the former binary choice of full hospital services or closing down completely.
- Under the designation, the hospital no longer provides inpatient care or swing bed services, and requires average patient length of stay to remain under 24 hours. The designation ensures community access to care by requiring a transfer agreement with a Level I or II trauma center and 24-hour emergency services, staffed emergency department including a physician, nurse practitioner, clinical nurse specialist, or physician assistant – pursuant to state scope of practice laws. They must also maintain Medicare Conditions of Participation from their previous designation to ensure patient health and safety in the hospital setting. Finally, they must meet applicable state licensing requirements.
- The REH model provides for a more sustainable payment system that will keep the hospital financially viable. REH payments are made under the Medicare Hospital Outpatient Prospective Payment System with a 5 percent add-on payment for covered services. Hospitals will also receive a fixed monthly payment based on a modified reimbursement formula for CAHs, and it will be subject to the hospital market basket percentage increase.
- Mercy Hospital’s new designation follows only SCK Medical Center in Arkansas City. Senator Marshall’s office is in communication with other Critical Access Hospitals considering the transition to a Rural Emergency Hospital as the most viable option for their community.
