Feds Begin Distributing $7.5B to Rural Health Providers

A nurse arranges supplies inside an emergency room suite at Scotland County Hospital on Nov. 24, 2020, in Memphis, Mo. The tiny hospital in rural northeast Missouri saw an alarming increase in coronavirus cases late last year.

A nurse arranges supplies inside an emergency room suite at Scotland County Hospital on Nov. 24, 2020, in Memphis, Mo. The tiny hospital in rural northeast Missouri saw an alarming increase in coronavirus cases late last year. AP Photo/Jeff Roberson

 

Connecting state and local government leaders

The funding comes after the pandemic dealt a hit to rural America's already eroding health care system.

Rural health care providers are set to receive federal payments under a $7.5 billion assistance program that's ramping up.

The Department of Health and Human Services said Tuesday it had begun distributing the funds, allotted under the pandemic recovery law known as the American Rescue Plan Act. Providers in rural areas who serve Medicaid, Children's Health Insurance Program or Medicare beneficiaries will qualify for the money.

HHS said in a news release that the Biden administration "is committed to providing much-needed relief to rural providers," noting that they often operate on thin financial margins and saw their finances further strained during the pandemic.

Payments under the program will range from $500 to about $43 million, with the average being about $170,700. More than 40,000 providers in all 50 states and Washington, D.C. will see a share.

“The infusion of these funds will be critical to ensuring rural communities maintain access to high-quality health care and addressing urgent needs like workforce recruitment and retention," HHS Secretary Xavier Becerra said in a statement.

The Chartis Group, a health care advisory firm, in a report issued this year, cited statistics indicating that at least 135 rural hospital had closed since 2010 and that another 453 were vulnerable to closure.

"The rapid spread of COVID-19 in rural communities has further destabilized the ability of rural hospitals to meet the needs of their communities," the report says. It adds that analyses have shown "rural communities to be older, less healthy, and less affluent than their urban counterparts, and they face declining access to services."

HHS said in its release that the ARPA funds will help health care providers keep their doors open, remain adequately staffed, and to make up for lost revenues and increased expenses caused by the Covid-19 pandemic.

Specific ways that providers can use the money include employee salaries, recruitment, medical supplies and equipment, capital and technology investments, along with other costs.

Many recipients under the rural payment program, HHS noted, will also be eligible for additional funding from a separate $17 billion federal pot of money for health care providers.

Bill Lucia is a senior editor for Route Fifty and is based in Olympia, Washington.

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