Estimating the Number of Hospitals that Might Convert to Rural Emergency Hospitals

Lead researcher:
Project funded:
September 2020
Project completed:
July 2021

Since 2005, more than 180 rural hospitals have closed. Rural hospital closures jeopardize access to emergency services in the affected communities. On December 21, 2020, Congress passed the Consolidated Appropriations Act (CAA) of 2021, which established Rural Emergency Hospitals (REHs). Effective January 1, 2023, hospitals that meet specified criteria will be eligible to convert to REHs. Although conditions of participation through rulemaking and sub-regulatory guidance have yet to be established by the Centers for Medicare & Medicaid Services, in accordance with the CAA, REHs will provide outpatient hospital and emergency department services without providing acute care inpatient services. REHs will be eligible for Medicare reimbursement for some services at rates higher than rates that would otherwise apply to services furnished in a hospital, and REHs will also receive a facility payment.

Because REHs are a new Medicare provider type, the number of rural hospitals that might consider converting to REHs is unknown. The purpose of this project was to estimate how many rural hospitals might convert to an REH.


  • How Many Hospitals Might Convert to a Rural Emergency Hospital?
    North Carolina Rural Health Research and Policy Analysis Center
    Date: 07/2021
    In this study, three measures were used to predict the number of rural hospitals with 50 beds or less that are likely to consider conversion to a Rural Emergency Hospital: 1) three years negative total margin; 2) average daily census (acute + swing) less than three; and 3) net patient revenue less than $20 million.