NRHA Statement on Cassidy/Hassan Site Neutral Framework

NRHA has significant concerns about the proposed site neutral payment reform framework released by U.S. Senators Bill Cassidy (R-LA) and Maggie Hassan (D-NH) on Nov. 1. While aimed at controlling health care expenses, the expansion of these policies threatens the financial stability of rural hospitals, compromising access to essential health services in rural communities. NRHA urges Congress to reconsider these devastating reforms.

Hospital outpatient departments (HOPDs) are essential access points for rural residents. The proposed payment cuts under the site neutral reforms disproportionately impact these rural hospitals, which already contend with lower patient volumes and higher costs per patient. Given that nearly 50 percent of rural hospitals currently operate at a loss, further cuts may have unsustainable consequences, jeopardizing service access across rural America. 

Rural off campus HOPDs are also crucial access points for rural patients as independent rural physician practices face increasing financial challenges. As physician practices struggle to remain open, rural hospitals often acquire them to sustain local health care access, which leads to greater reliance on off campus HOPDs. Reductions in HOPD payments would destabilize these rural access points and create significant access barriers for rural patients.

Given the structural and financial realities of rural health care, NRHA calls on Congress to reject all future site neutral payment policies. NRHA strongly opposes the expansion of site neutral payment reforms that compound financial strain on rural hospitals. 

Should Congress proceed with expanding site neutral policies despite these concerns, NRHA calls for an exemption for all rural hospitals. NRHA advocates for broadening the current exemption, which now applies to sole community hospitals (SCHs), to include all rural hospitals paid under the Outpatient Prospective Payment System (OPPS), specifically Medicare-dependent hospitals, low-volume hospitals, and rural PPS hospitals with fewer than 100 beds. These facilities face the same challenges as SCHs in maintaining service volumes and providing critical care access, often serving as the sole providers in their regions. Extending the SCH exemption to these hospitals would help alleviate financial pressures and safeguard essential services for rural communities. 

NRHA appreciates the acknowledgement of the challenges rural hospitals face in maintaining access to care in Senators Cassidy and Hassan’s proposal. Rather than cutting rural payments, and in turn, offering bonus payments for limited services, NRHA calls on Congress to reinvest fully in rural hospitals to support their financial viability and sustain essential service lines. Reinvestment should directly address the funding gaps caused by lower Medicare reimbursements due to site-neutral payment policies, ensuring that rural hospitals can continue to serve their communities effectively.

For supplementary material, please find NRHA’s policy paper outlining the impact of site-neutral payments.