Sec. 423. Establishment of Rural Community Hospital (RCH) Program

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Section 1861 of the Social Security Act ( 42 U.S.C. 1395x ), as amended by section 203(b)(1), is amended by adding at the end of the following new subsection: The term rural community hospital means a hospital (as defined in subsection (e)) that— is located in a rural area (as defined in section 1886(d)(2)(D)) or treated as being so located pursuant to section 1886(d)(8)(E); subject to paragraph (2), has less than 51 acute care inpatient beds, as reported in its most recent cost report; makes available 24-hour emergency care services; subject to paragraph (3), has a provider agreement in effect with the Secretary and is open to the public as of January 1, 2010; and applies to the Secretary for such designation.

For purposes of paragraph (1)(B), beds in a psychiatric or rehabilitation unit of the hospital which is a distinct part of the hospital shall not be counted. Paragraph (1)(D) shall not be construed to prohibit any of the following from qualifying as a rural community hospital: A replacement facility (as defined by the Secretary in regulations in effect on January 1, 2012) with the same service area (as defined by the Secretary in regulations in effect on such date). A facility obtaining a new provider number pursuant to a change of ownership.

A facility which has a binding written agreement with an outside, unrelated party for the construction, reconstruction, lease, rental, or financing of a building as of January 1, 2012. Nothing in this subsection shall be construed as prohibiting a critical access hospital from qualifying as a rural community hospital if the critical access hospital meets the conditions otherwise applicable to hospitals under subsection

(e)and section 1866. Nothing in this subsection shall be construed as prohibiting a rural community hospital participating in the demonstration program under section 410A of the Medicare Prescription Drug, Improvement, and Modernization Act of 2003 ( Public Law 108–173 ; 117 Stat. 2313) from qualifying as a rural community hospital if the rural community hospital meets the conditions otherwise applicable to hospitals under subsection

(e)and section 1866. . Section 1814 of the Social Security Act ( 42 U.S.C. 1395f ) is amended by adding at the end the following new subsection: The amount of payment under this part for inpatient hospital services furnished in a rural community hospital, other than such services furnished in a psychiatric or rehabilitation unit of the hospital which is a distinct part, is, at the election of the hospital in the application referred to in section 1861(jjj)(1)(E)— 101 percent of the reasonable costs of providing such services, without regard to the amount of the customary or other charge, or the amount of payment provided for under the prospective payment system for inpatient hospital services under section 1886(d). . Section 1834 of such Act ( 42 U.S.C. 1395m ) is amended by adding at the end the following new subsection: The amount of payment under this part for outpatient services furnished in a rural community hospital is, at the election of the hospital in the application referred to in section 1861(jjj)(1)(E)— 101 percent of the reasonable costs of providing such services, without regard to the amount of the customary or other charge and any limitation under section 1861(v)(1)(U), or the amount of payment provided for under the prospective payment system for covered OPD services under section 1833(t). . Section 1861(v)(1)(T) of such Act ( 42 U.S.C. 1395x(v)(1)(T) ) is amended by inserting (other than for a rural community hospital) after In determining such reasonable costs for hospitals . Section 1834(p) of such Act (as added by subsection (b)(2)) is amended— by redesignating paragraphs

(1)and

(2)as subparagraphs

(A)and (B), respectively; by inserting

(1)after

(p); and by adding at the end the following: The amounts of beneficiary cost-sharing for outpatient services furnished in a rural community hospital under this part shall be as follows: For items and services that would have been paid under section 1833(t) if provided by a hospital, the amount of cost-sharing determined under paragraph

(8)of such section. For items and services that would have been paid under section 1833(h) if furnished by a provider or supplier, no cost-sharing shall apply. For all other items and services, the amount of cost-sharing that would apply to the item or service under the methodology that would be used to determine payment for such item or service if provided by a physician, provider, or supplier, as the case may be. . Section 1814(b) of such Act ( 42 U.S.C. 1395f(b) ) is amended in the matter preceding paragraph

(1)by inserting other than inpatient hospital services furnished by a rural community hospital, after critical access hospital services, . Section 1833(a) of such Act ( 42 U.S.C. 1395l(a) ), as amended by section 203(b)(2), is amended— in paragraph (2), in the matter before subparagraph (A), by striking and

(I)and inserting (I), and

(K); by striking and at the end of paragraph (9); by striking the period at the end of paragraph

(10)and inserting ; and ; and by adding at the end the following: in the case of outpatient services furnished by a rural community hospital, the amounts described in section 1834(p). . Section 1863 of such Act ( 42 U.S.C. 1395z ) is amended by striking and (dd)(2) and inserting (dd)(2), (mm)(1), and (jjj)(1) . Section 1866(a)(2)(A) of such Act ( 42 U.S.C. 1395cc(a)(2)(A) ) is amended by inserting section 1834(p)(2), after section 1833(b), . The amendments made by this section shall apply to items and services furnished on or after October 1, 2014.

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