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CMS Announces Grants for Rural Healthcare Pilot Program

On September 15, 2020, the Centers for Medicare & Medicaid Services (CMS) announced $75,000,000 in grants for rural providers. Grant recipients would participate in a seven-year payment test model designed to improve healthcare in rural communities. Applications are due February 16, 2021.

The grants are part of the Community Health Access and Rural Transformation (CHART) Model. The CHART Model is part of CMS’s Rethinking Rural Health initiative, which aims to ensure individuals in rural America have access to high quality, affordable health care by offering new and creative payment models.  According to CMS, the CHART Model “will test whether aligned financial incentives, increased operational flexibility, and robust technical support promote rural health care providers’ capacity to implement effective health care delivery system redesign on a broad scale.” The impact of the model will be evaluated by the Center for Medicare & Medicare Innovation (CMMI). The CHART Model contains two tracks: the Community Transformation Track and the Accountable Care Organization (ACO) Transformation Track. The newly announced grants are for the Community Transformation Track only.

Under the Community Transformation Track, CMS anticipates awarding 15 grants in the amount of $5,000,000 each, for a total of $75,000,000. Eligible applicants must serve a county or set of counties that are rural, as defined by the Federal Office of Rural Health Policy, and that includes at least 10,000 Medicare fee-for-service beneficiaries whose primary residence is within the county or set of counties. CMMI encourages applicants to submit letters of intent prior to submitting an application. Letters of intent are due January 18, 2021 and final applications are due February 16, 2021.

Grant recipients will receive capitated payments under a cooperative agreement. Grant recipients will also receive a programmatic framework to assess the needs of the rural area they serve and implement a health care system redesign. CMS anticipates a one-year pre-implementation period, during which grant recipients will consult with local stakeholders to develop and submit a Transformation Plan to CMMI that describes the recipient’s health care delivery system redesign strategy. CMS then anticipates a six-year performance period, during which recipients will implement, analyze, and update its Transformation Plan.

Under the ACO Transformation Track, entities will receive upfront payments to establish or expand rural ACOs that participate in two-sided risk arrangements through the Medicare Shared Savings Program. CMMI will release further information on the ACO Transformation Track at a later date.

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