Summary: To maintain health care services in rural communities, Congress authorized limited-service hospitals, known as rural primary care hospitals, to operate in seven states--California, Colorado, Kansas, New York, North Carolina, South Dakota, and West Virginia. In October 1997, Congress replaced rural primary care hospitals with critical access hospitals, which were authorized to operate nationally. Existing rural primary care hospitals were eligible to participate in Medicare as critical access hospitals. GAO found that rural primary care hospitals were an important source of inpatient and outpatient care for Medicare beneficiaries in rural areas. Medicare payments to these hospitals for inpatient stays were, however, somewhat higher than payments would have been to full-service rural hospitals. A chief reason for this was that about 21 percent of the inpatient cases had lengths of stays that exceeded the 72-hour maximum in effect at the time, and eight percent would have exceeded the 96-hour limit for critical access hospitals. The Health Care Financing Administration (HCFA) has not established a way to enforce the length-of-stay limit, and GAO believes that one is needed to give critical access hospitals an incentive to adhere to the limit. For critical access hospitals and peer review organizations that are authorized to grant waivers to the 96-hour limit, HCFA also needs to define the conditions and the circumstances under which it would be appropriate to waive the requirement. HCFA also has not established a way to check compliance with the requirement that a doctor certify that patients admitted to rural primary care hospitals--now critical access hospitals--are expected to be discharged within the maximum allowed length-of-stay limit. Such a mechanism should underscore the importance of certification and its intent to ensure that only the appropriate kinds of patients are admitted.
