Since 2010, America’s rural communities have been facing a rapidly growing crisis of disparity in access to healthcare. Rural hospitals across the nation are closing their doors at a faster rate than ever seen before. This is creating ripple effects throughout the communities they once served and crippling access to emergency care, negatively impacting prospective economic development, and leaving a dwindling population in its wake.

According to the National Rural Health Association’s July 2023 article, “Rural Emergency Hospital Model Summary,” more than 135 rural hospitals have closed since 2010 and more than 450 are identified as vulnerable to closure.

The American Hospital Association’s 2022 report Rural Hospital Closures Threaten Access outlines the issues contributing to closure including low reimbursement, staffing shortages, low patient volume, and regulatory barriers.

To amplify these issues further, in 2016, Medicare underpayments increased beyond 40 percent, resulting in a major reimbursement shortfall from a program many rural facilities rely heavily upon for financial support. Following this additional burden, the COVID-19 pandemic saddled an already struggling operational infrastructure with additional financial and staffing challenges.

In an effort to begin addressing these issues, The Consolidated Appropriations Act (CAA) of 2021 included a stimulus relief response to the pandemic, as well as a new Centers for Medicare & Medicaid Services (CMS) reimbursement designation, the Rural Emergency Hospital (REH)—the first of its kind in more than 25 years.

The REH designation is an emerging Medicare provider type, with conversion eligibility having begun in Jan. 1, 2023. Much like its reimbursement predecessors for rural healthcare, the Critical Access Hospital designation and Prospective Payment System, REH provides federally funded financial support to provide access and promote equity of emergency care in rural areas as well as help halt rural hospital closures. (For more on this topic, find the author speaking with a panel in session “E14: Rural Emergency Hospital – The Future of Promoting Equity and Access to Care,” at the 2023 HCD Conference + Expo, Nov. 4-7 in New Orleans. For conference and registration details, visit

 Requirements of REH designation

According to CMS, services provided by an REH-eligible facility are limited to “emergency department services, observation care, and additional outpatient medical and health services, if elected by the REH, that do not exceed an annual per patient average length of stay of 24 hours. REHs are prohibited from providing inpatient services, except those furnished in a distinct part licensed as a skilled nursing facility to furnish post-hospital extended care services.”

Operationally, the REH designation also requires a clinician, doctor of medicine or osteopathy, physician assistant, nurse practitioner, or clinical nurse specialist with experience in emergency care to always be on call and immediately available on-site within a stipulated time.

The REH must also have in place a transfer agreement with at least one Medicare-certified hospital that is designated as a Level I or Level II trauma center.

To be eligible to convert to an REH, CMS states the facility must have been enrolled and certified within the Medicare program as of Dec. 27, 2020. Facility types include critical access hospitals, hospitals with no more than 50 beds located within a rural area, and hospitals with no more than 50 beds that were treated as being located in a rural area.

CMS also extended this invitation of eligibility to facilities that may have already closed after Dec. 27, 2020. In this scenario, facilities must re-enroll into the Medicare program and fulfill all necessary REH requirements to receive the financial support of the REH designation and re-open their doors.

In addition to federal eligibility requirements, the state in which the hospital resides may also have its own stipulations and criteria for licensure.

Challenges to REH conversion

From December 2020 until implementation of the REH program, various healthcare industry stakeholders participated in an open discussion with CMS and provided their feedback of potential barriers they expected to see post rollout.

Of these named challenges, two reoccurring topics developed, including the potential struggle of maintaining access to EMS necessary to adhere to the REH transport agreement and the impact of extended visits of behavioral health patients who often push beyond the REH-stipulated 24-hour length of stay.

Janice Walters, COO, and Anna Anna, project director, Rural Emergency Hospital Technical Assistance Center (REH-TAC; Harrisburg, Pa.) , have been working alongside HRSA and CMS to provide technical assistance nationwide to rural hospitals interested in pursuing the REH designation.

From their experience working with multiple organizations across the nation, the majority of systems do not flag EMS access as a potential barrier. As for the concern regarding extended behavioral health visits, the REH-TAC reiterated that the REH maximum 24-hour requirement isn’t designated for each visit, but rather an annual average taken across all visits.

However, some issues have cropped up since January. Specifically, with the adoption of the new Medicare-provider type, systems are required to pivot away from aspects of inpatient care to an outpatient care setting. This difference of mentality begins to collide when discussing the removal of the Critical Access Hospital’s swing bed reimbursement agreement.

For a rural health facility, swing beds provide the necessary and vital solution for a patient’s journey to wellness, as the bed can “swing” designation within an existing nursing unit, while utilizing already present staff for observation and maximizing operational flexibility.

In efforts to address this patient need, CMS will allow a “distinct part licensed as a skilled nursing facility (SNF) to furnish post-hospital extended care services.” However, when considering the clinical and operational challenges of working from a REH, it becomes apparent the need for streamlined workflow efficiencies through direct adjacencies to flex medical care team members.

Although the need to flex what is usually an already limited staff is not a new concept in rural healthcare design, the REH model will also need to adapt to rise to the challenges of today’s rural healthcare. In the interim, designers will need to strategically collocate these spaces to lessen the burden of flexing staff between two designated spaces. For example, the removal of inpatient services creates a physical void and perhaps inefficient disconnect within the existing facility itself.

As a result, designers could be tasked in retrofitting these valuable spaces with new supportive services allowable under the new designation such as behavioral health, radiology, laboratory, rural health clinic, telehealth services, or outpatient rehabilitation.

Design considerations for rural healthcare facilities

Design considerations for facilities that meet the REH designation include creating a more compact, efficient footprint, with the direct adjacencies needed between the emergency department and observation unit, as well as the opportunity to connect a skilled nursing facility.

Similar to the microhospital concept, but excluding the inpatient services, special attention will need to be directed toward creating a cost-effective design as well as achieving operational efficiency to allow for flexibility due to limited staff. Designers must also consider the context of the community, providing a financially sustainable and scalable design with room to grow to accommodate any future REH needs.

Many of these objectives were carefully studied when designing Spartanburg Regional Health System’s Union Medical Center, a replacement facility in Union, S.C. that’s currently under construction. The organization’s existing rural hospital in many ways was already operating like an REH, with higher-acuity patients transferred to a larger campus and provision of some inpatient services was suspended.

For example, the surgery department had long been vacated and converted to a rural health clinic. However, the constraints of the existing facility included an aging and oversized infrastructure, which created inefficiencies and a lack of needed adjacencies between departments.

With the new replacement facility, direct department adjacencies are captured through right-sizing the new facility and seamlessly marrying outpatient services including a rural health clinic, pediatrics and OB-GYN care, infusion, hematology, and oncology.

The design also accommodates a future connection for a skilled nursing facility, with infrastructure in place to share various back-of-house services, the central energy plant, kitchen, and dining.

Importance of protecting rural healthcare

For facilities facing financial difficulty, this could offer much needed stability and the opportunity to expand outpatient services. In a time when rural communities are faced with losing access to emergency care, this serves as a lifeline of protection from the unfortunate alternative: closure.

From a community perspective, maintaining the small rural community hospital is a source of generational pride and supplies a space for healing, gathering, education, religion, community involvement, celebration, and even the occasional Sunday supper.

As CMS’s first response in over 25 years for providing financial assistance in efforts to protect rural healthcare, the Rural Emergency Hospital in many ways is a step in the right direction for change.

While further modifications of the provider type are imminent, decision-makers, stakeholders, and designers will continuously be challenged to work together to find the best solution for protecting rural healthcare today and in years to come.

Hillary Earl Crosby, AIA NCARB, is an architect at Earl Architects (Greenville, S.C.) and can be reached at