# Rural Hospital Closure Relief Act of 2025 - Plain Language Summary

## What This Bill Does

This bill aims to help rural hospitals stay open by giving states more flexibility in designating certain hospitals as "Critical Access Hospitals" under Medicare. Specifically, it removes or relaxes the current 35-mile distance rule that prevents hospitals from qualifying for this special Medicare status if they're located too close to another hospital. The bill allows states to certify hospitals as Critical Access Hospitals if they meet certain financial and community need criteria, even if they don't meet the traditional distance requirement.

## Who Benefits

The primary beneficiaries are struggling rural hospitals that are at risk of closing, particularly those that:
- Serve as the sole community hospital in their area
- Are located in economically disadvantaged counties or areas with healthcare shortages
- Have experienced financial losses in recent years
- Serve populations with high Medicare enrollment

States would also benefit by gaining authority to make these designations based on local needs rather than federal distance rules.

## Key Provisions

- **State Authority**: States can certify eligible hospitals as Critical Access Hospitals without the 35-mile distance restriction
- **Eligibility Requirements**: Hospitals must demonstrate financial hardship (2 consecutive years of negative margins), be located in rural or underserved areas, and submit a plan showing how they'll improve financially and add needed services
- **Service Commitments**: Hospitals must commit to opening or expanding services in high-demand areas like obstetrics or behavioral health
- **Limits**: The program caps certifications at 120 hospitals total and expires 9 years after enactment
- **Governance Standards**: Hospitals must demonstrate good governance and provide a multi-year financial recovery plan

Rural Hospital Closure Relief Act of 2025

Durbin, Richard J.

Rural Hospital Closure Relief Act of 2025This bill temporarily allows additional hospitals to qualify as critical access hospitals (CAHs) that receive special payment under Medicare.Currently, in order to qualify as a CAH under Medicare, a hospital must either (1) be located more than 35 miles (or 15 miles in mountainous regions or areas with only secondary roads) from another hospital, or (2) have been certified prior to January 1, 2006, by the state as a necessary provider of services in the area.The bill allows&nbsp;a hospital to also qualify if the hospital is a small, rural hospital that (1) serves a health professional shortage area, or a high number of low-income individuals or Medicare beneficiaries; (2) has experienced financial losses for two consecutive years; and (3) attests to having a strategic plan to address financial solvency and to committing to provide a service that is in high demand in the hospital's service area. This authority expires nine years after the bill's enactment.The Government Accountability Office must study the effects of the bill's implementation. In addition, the Medicare Payment Advisory Commission must study and recommend payment systems for rural hospitals under Medicare.&nbsp;The Centers for Medicare &amp; Medicaid Services must subsequently establish a mechanism and issue guidance on how newly designated CAHs may transition to different payment models under Medicare, including any new payment models recommended by the commission.