R3-A · Workforce implementation plan

A BILL FOR AN ACT

Relating to rural hospital access.

Be It Enacted by the People of the State of Oregon:

SECTION 1. As used in sections 1 to 4 of this 2027 Act:

(1) “Authority” means the Oregon Health Authority.

(2)(a) “Hospital” means a facility in this state that is licensed by the authority under ORS 441.025 to provide general hospital services, provides acute inpatient care and operates an emergency department that accepts patients 24 hours each day. For purposes of the systemically important rural hospital designation under section 2 of this 2027 Act, “hospital” includes a facility licensed as a low occupancy acute care hospital if the facility provides those services.

(b) The unit of designation is the licensed hospital at its principal inpatient campus. “Principal inpatient campus” means the site identified as the hospital's main inpatient site on the license or, if the license does not identify the site, the licensed site with the greatest number of beds of the types described in subsection (3)(a) of this section. The authority shall resolve a tie by using the site with the greatest number of acute inpatient discharges in the most recent 12 completed calendar months for which complete data are available. If a tie remains, the authority shall use the main inpatient practice location in the hospital's current Medicare provider agreement if that location is one of the tied sites. If the preceding tests do not identify a site, the authority shall identify which tied site principally provides emergency stabilization and receives inpatient transfers based on documented service volumes or, if comparable volumes are unavailable or equal, the hospital's emergency and referral service plans. The authority shall state its reasons in the order under section 3 of this 2027 Act. A hospital may receive only one designation as a systemically important rural hospital for the same principal inpatient campus.

(c) A hospital may not combine the beds, licensure, admissions, Medicare classifications or service capabilities of a separately licensed facility to meet a criterion in section 2 of this 2027 Act. A parent organization, health system, outpatient site or satellite without a separately licensed acute inpatient hospital is ineligible to hold a separate designation.

(3)(a) “Licensed acute inpatient beds” means the maximum number of beds that the authority authorizes in writing under the hospital's license for general acute inpatient care at the principal inpatient campus on the applicable measurement date. Count a bed used for swing-bed services once if it is also licensed for general acute inpatient care. Exclude beds licensed solely for psychiatric, rehabilitation, long term care or other special inpatient services, observation stations that are not licensed for inpatient care and beds authorized only during a declared emergency. Include beds licensed for general acute inpatient care even if they are temporarily unstaffed or unoccupied.

(b) The authority shall use the license and its approved schedules or a written determination by the authority's licensing program based on those records. A count of staffed, occupied or federally reported beds does not establish licensed capacity under this subsection.

(4) “Nonmetropolitan location” means a principal inpatient campus physically located in an Oregon county that is outside a metropolitan statistical area identified in Office of Management and Budget Bulletin No. 23-01, issued July 21, 2023. A county's inclusion in a micropolitan statistical area or combined statistical area does not establish its inclusion in a metropolitan statistical area. A Medicare geographic adjustment, wage-index reclassification or treatment as rural for payment purposes does not change the hospital's physical location under this subsection.

(5) “Dual federal classification” means that the Centers for Medicare and Medicaid Services or its authorized contractor classifies the same hospital, in relation to the same principal inpatient campus and under the hospital's active inpatient prospective payment system provider agreement, as both a sole community hospital under 42 C.F.R. 412.92 and a rural referral center under 42 C.F.R. 412.96. The classifications must be simultaneously in effect on the measurement date. The authority shall establish the effective dates and the facility to which the federal determinations apply. An administrative payment file is evidence of status and must be reconciled with a later, conflicting or superseding determination, including a conversion to a critical access hospital.

(6) “Functional criteria” means that the hospital:

(a) Has a nonmetropolitan location and provides general acute inpatient medical and surgical care, emergency stabilization and the ability to receive and care for patients transferred from another facility when medically appropriate. The hospital must maintain operative transfer arrangements for patients who require services that the hospital does not provide;

(b) Is at least 45 minutes by ordinary motor vehicle travel from the nearest other hospital in Oregon or an adjoining state that provides general acute inpatient medical and surgical care and operates an emergency department that accepts patients 24 hours each day. The authority shall measure time using the shortest normally available public-road route between the two emergency department entrances and shall publish its data and method. Routine seasonal road closures must be accounted for. A temporary closure arising from an isolated event may not be used to establish eligibility; and

(c) In each of the two most recent completed calendar years, had a share of acute inpatient discharges of at least 20 percent as calculated under paragraph (d) of this subsection and admitted at least 50 acute inpatients by documented direct transfer from at least two other separately licensed health care facilities. Do not count movement between campuses of the same hospital as a qualifying direct transfer. The authority may accept auditable hospital records where other data are incomplete. The authority may not waive either threshold or substitute an earlier calendar year.

(d) For the 20 percent test in paragraph (c) of this subsection, the denominator is all acute inpatient discharges of Oregon residents at the principal inpatient campus during the calendar year and the numerator is the subset whose residence at admission was in a nonmetropolitan Oregon county other than the hospital's county. Count a discharge once. Use the geography in subsection (4) of this section. The hospital does not meet the test if the denominator is zero or the required data are unavailable.

SECTION 2. (1) A hospital is designated a systemically important rural hospital if the hospital has a nonmetropolitan location and has dual federal classification.

(2) The criteria in subsection (1) of this section are applied as of the date of application or initiation of a determination by the authority, whichever first applies, and on recertification or a determination arising from a material change under section 3 of this 2027 Act.

(3) The number of licensed, staffed or occupied beds does not determine eligibility under this section. The authority shall collect available licensing information on size for reporting and review of overlap with other hospital programs. The status and benefits of a Type A, Type B, Type C or rural critical access hospital continue under the laws governing that status and those benefits.

SECTION 3. (1) The Oregon Health Authority shall establish a process to certify each hospital meeting the requirements of section 2 of this 2027 Act. The authority may initiate a determination using available records. A hospital may apply at any time and provide evidence for a determination, correction, recertification or reinstatement. The authority shall give the hospital a reasonable opportunity to supply relevant evidence and shall specify any unavailable record necessary for a determination.

(2) No later than 180 days after the effective date of this 2027 Act, the authority shall publish its first roster of hospitals certified under section 2 of this 2027 Act. The authority shall complete an application determination within 90 days after receipt of a complete application and shall review the roster at least annually. The authority shall promptly update the roster after a final order affecting a listing. The roster shall identify the hospital, principal inpatient campus, state license number, active Medicare certification number if any, class and qualification pathway, determination date, evidence measurement dates and any applicable provisional continuation period. The authority shall publish the rules and methods used in making determinations and an explanation of any limits in the evidence used for the roster. The authority shall disclose the roster and a summary of its findings consistent with state and federal laws governing disclosure of information. The public roster may not contain patient identifying information or other information whose disclosure is prohibited by law.

(3) The authority shall issue a written order certifying, recertifying, reinstating, changing or denying certification. Except as provided in subsection (7) of this section for a temporary interruption, the authority may certify a hospital only if it finds the hospital meets the applicable criteria on the effective date of certification. An applicant shall inform the authority of any material change during the pendency of an application. The order shall state the applicable criteria, findings for each criterion, the sources and measurement dates on which the findings depend and the effective date of the action. An incomplete or contradictory administrative record shall be identified in the findings. The absence of an entry in a public file may not be treated as conclusive evidence of ineligibility if reliable underlying records are available.

(4) Before denying an application or changing, suspending or terminating a certification adversely to a hospital, the authority shall give written notice of the proposed action, the basis and proposed effective date, and the opportunity to respond and request a contested case hearing within 30 days after service of the notice. A proceeding requested under this subsection is a contested case under ORS chapter 183. The authority shall state in the notice whether the hospital is eligible to apply under a different pathway. A final order is subject to judicial review under ORS 183.482. This subsection does not stay any licensure or safety action or authorize provision of services for which a license has ceased to be effective.

(5) A certified hospital shall notify the authority in writing of a material change that may affect a class criterion within 30 days after the hospital learns of the change. A material change includes a change to the operator, license, principal inpatient campus, active Medicare provider agreement or classification, inpatient bed schedule where a bed criterion applies, or the availability of services required for qualification. The authority shall review the certification after notice or on receipt of reliable evidence of a material change. A change in name or ownership does not itself disqualify a hospital. The authority shall reassess the eligible unit and criteria when a license, active federal provider agreement or location changes. The authority shall determine the effect of a consolidation or replacement campus under section 2 of this 2027 Act using the new operating and certification records. Certification may not be transferred by sale, assignment or use of a former Medicare certification number.

(6) A certified hospital that ceases all general acute inpatient operations on a permanent basis, or lacks an effective Oregon license authorizing the operations required for qualification, ceases to hold the designation when the operations permanently cease or the license ceases to be effective. The authority shall issue notice and afford review under subsection (4) of this section and correct the roster if the underlying fact or effective date was incorrect.

(7)(a) If a certified hospital continues lawful operation of its general acute inpatient and emergency services and there is a temporary interruption of a criterion other than nonmetropolitan location, the authority may enter a written order continuing the state designation for no more than 12 months after the effective date of the interruption, unless section 2 of this 2027 Act provides otherwise. A continuation order requires findings that the same principal inpatient campus continues to serve the access and referral function for which it qualified and that the hospital has supplied a documented plan and a reasonable schedule to restore the criterion or establish eligibility under another pathway. The authority may continue designation during a temporary interruption of inpatient or emergency services caused by a declared emergency if the license remains effective and the hospital has an approved reopening plan. The total continuation period for the same interruption may not exceed 12 months.

(b) A temporary interruption may include a correctable federal administrative lapse, a temporary reduction in licensed capacity where the bed count is a class criterion, or an interruption of a qualifying service. An intentional permanent service discontinuance, permanent conversion to a different Medicare payment system, or relocation that fails the applicable geography or campus criterion does not qualify for continuation. The authority shall record the basis and expiration date of the continuation and require reasonable periodic evidence of progress. The hospital may apply for reinstatement upon supplying evidence that it meets all criteria for the relevant pathway. A determination may correct the effective date if contemporaneous records establish that the condition did not lapse.

(c) An order under this subsection continues only the state designation. Payment eligibility, continued payment, settlement, reconciliation and recovery depend on the separate law and approvals governing each benefit. Designation may be reinstated prospectively on a new determination. A correction of the historical eligibility record does not independently authorize retroactive payments.

(8) If a federal rule is amended, replaced or repealed, the authority shall apply the facility's federal determinations and any applicable transition under this section. If the change removes a classification used by section 1 of this 2027 Act, substitutes a classification with materially different criteria or materially changes the Oregon class, the authority shall notify the interim committees of the Legislative Assembly related to health care and reimbursement in the manner provided by ORS 192.245 within 90 days after the authority identifies the change. The authority may not substitute a different eligibility criterion by rule. The authority shall recommend any statutory change necessary to continue the public purpose of the designation.

SECTION 4. (1) The systemically important rural hospital designation recognizes hospitals providing access to hospital care for their communities and receiving referrals from the region. For purposes of sections 1 to 4 of this 2027 Act, a decision on designation is based on the eligible hospital and the statutory criteria. A hospital's public, nonprofit or proprietary ownership, system affiliation, decision to contribute funds, or financial condition does not determine its eligibility. A hospital's trauma level does not determine eligibility except to the extent section 2 of this 2027 Act expressly provides otherwise. The authority may consider trauma designation as evidence of actual service capability where a functional criterion applies.

(2) The designation does not change a hospital's state license, federal Medicare classification or any Type A, Type B, Type C or rural critical access hospital classification. Sections 1 to 4 of this 2027 Act do not change payment or access protections under existing law, impose a hospital assessment or contribution, authorize a transfer of public funds, appropriate money or entitle a hospital to payment. This subsection does not preclude the application of a separate provision of law expressly authorizing a benefit, reimbursement or obligation for a certified hospital. Qualification for a benefit and treatment of payments for the same service shall be determined under the law and required approvals governing the benefit.

(3) The authority may adopt rules to administer sections 1 to 4 of this 2027 Act. Rules may specify documentation, application forms, evidence verification, review periods, address reconciliation, computation and reporting. Rules may not expand or narrow an eligibility criterion or waive a geographic, service, federal-classification or numeric requirement established by law. The authority shall use existing reports when sufficient and require only evidence reasonably necessary to make and review the determination. Disclosure, retention and use of submitted information remain subject to applicable state and federal law.

SECTION 5. Sections 1 to 4 of this 2027 Act are added to and made a part of ORS chapter 442.

SECTION 6. This 2027 Act takes effect on the 91st day after the date on which the 2027 regular session of the Legislative Assembly adjourns sine die.

SECTION 7. (1) No later than 180 days after the effective date of this 2027 Act, the Oregon Health Authority shall publish a process through which a hospital certified as a systemically important rural hospital under section 3 of this 2027 Act may request a written rural workforce implementation plan for a documented shortage of clinical services in a rural or medically underserved Oregon community served by the hospital. The authority shall coordinate the process with the Oregon Health and Science University in the university’s capacity under ORS 676.467 and with other public administrators of relevant existing programs. A hospital may submit a request with a rural clinic, tribal health program, professional training program or other qualified partner. The request must identify the shortage, the proposed practice or training site, the services the applicant intends to add or retain and any known funding or service obligations for the same activity.

(2) Within 60 days after receiving a complete request under subsection (1) of this section, the authority shall provide the hospital a written plan identifying:

(a) Existing incentives, including loan repayment or forgiveness, community workforce plan assistance and behavioral health workforce incentives, that may address the shortage under the applicable provider, site, service obligation and funding requirements.

(b) The eligible applicant or applicant type for each potentially applicable program, the next available application opportunity, required supporting material, the responsible program administrator, and any known restriction affecting use of more than one program. If an application date or the availability of money is unknown, the plan must identify that limitation.

(c) The proposed clinical services or training that current programs appear able to support, any portion that the programs do not address, and which documented costs or service obligations must be kept separate to avoid duplicate support.

(3) The plan is technical assistance. An application for an existing incentive shall be submitted to and determined by the applicable program administrator under the law governing that program. This section does not change an applicant’s eligibility, priority, allowable costs or service obligations under an existing program, transfer any allocation or approval authority, reserve program money or authorize an award or reimbursement. A hospital’s certification under section 3 of this 2027 Act determines eligibility for the plan under subsection (1) of this section. It does not determine eligibility for or priority in an existing program. An applicant remains responsible for disclosing overlapping support or service obligations under the requirements of the applicable program.

SECTION 8. (1) No later than September 15, 2028, the Oregon Health Authority, in consultation with the Oregon Health and Science University, shall report to the interim committees of the Legislative Assembly related to health care and to the Joint Committee on Ways and Means, in the manner provided by ORS 192.245, on the operation of section 7 of this 2027 Act. The report must identify the number of requests and completed plans, recurring shortages addressed, verified barriers that existing programs do not address, and any statutory or funding changes needed. The report must use aggregate information and exclude information made confidential by law.

(2) The authority and university shall carry out sections 7 and 8 of this 2027 Act using existing administrative resources and program authority. The authority may adopt rules to administer those sections. The authority shall publish the application information needed to start the 60-day period under section 7 of this 2027 Act and promptly identify any missing information to an applicant. Sections 7 and 8 of this 2027 Act do not appropriate money or affect a designation under sections 1 to 4 of this 2027 Act.

Back to top