CMS Authorizes Enhanced Payments for Rural Hospitals

U.S. Senator Jerry Moran announced Wednesday the Centers for Medicare and Medicaid Services (CMS) approved Kansas’ application to allow Critical Access Hospitals (CAHs) and Rural Emergency Hospitals (REHs) to receive enhanced payments through the state’s provider assessment program. During negotiations on the One Big Beautiful Bill Act, Sen. Moran included language in the legislation to make certain Kansas rural hospitals could receive increased Medicaid reimbursements.

“Rural hospitals across Kansas will now be able to access additional federal dollars through the Medicaid program, helping strengthen our rural providers,” said Sen. Moran. “During the consideration of last year’s Reconciliation Bill, I secured language to make certain Kansas rural hospitals could participate in the state provider assessment program and that the state’s application would remain eligible for consideration and approval. This decision by CMS opens the program to more rural hospitals to participate, providing Kansas CAHs and REHs with more than $72 million a year, which will help bolster rural hospital stability in Kansas.”

“CMS’ approval of Kansas’ 2026 state directed payment preprint is a meaningful step towards providing critical stability for Kansas hospitals serving Medicaid patients across the state,” said Chad Austin, President and CEO of the Kansas Hospital Association. “The inclusion of Critical Access Hospitals and Rural Emergency Hospitals to receive enhanced support is especially significant and will help strengthen access to essential care in rural Kansas and beyond. With base Medicaid payments falling well below the cost of providing care, this program is vital to helping hospitals both maintain their operations and sustain services such as obstetrics and behavioral health care. Kansas hospitals are grateful for the leadership of Senator Moran who championed this important outcome.”

With this new approval from CMS, Kansas CAHs and REHs will be able to benefit fully from this increased assessment rate and generate more than $72 million a year for rural hospitals. In addition, this application approval continues the increased PPS hospital provider assessment rate, which is expected to generate approximately $1 billion annually for Kansas providers. Through Sen. Moran’s work on the One Big Beautiful Bill Act, Kansas providers will receive increased Medicaid reimbursements for the next decade.

A recent RAND study showed that Kansas will take in more revenue because of the One Big Beautiful Bill Act.

In a statement Thursday, Aaron Herbel, administrator of Mercy Hospital in Moundridge said “I want to express my appreciation for the dedication and time commitment Senator Moran and his staff have devoted to this effort on behalf of Kansas hospitals. As the CEO of a Rural Emergency Hospital (REH) in Kansas, the inclusion of CAHs and REHs in the state provider assessment program will result in additional funding to help our hospital close the gap that exists between the cost of providing care to Medicaid patients, and the current reimbursement. This funding will help ensure essential healthcare services can be delivered to patients in communities across the state.”

Neosho Memorial Regional Medical Center CEO Wendy Brazil said “The impact of these payments to local hospitals will be felt in emergency rooms that remain open, rural communities that can recruit new providers and health professionals, and the ability to invest in infrastructure and equipment. Behind every dollar is a patient—a mother receiving care in her hometown, a child seeing a local pediatrician, a senior managing a chronic condition, or an accident victim receiving life-saving treatment without having to travel hours for care. State Directed Payments help make these services possible. We appreciate Senator Moran’s tireless efforts on behalf of Kansas hospitals. His support is so important to our ability to continue to provide high-quality care to rural residents.”

Morgan Allison, administrator of Kiowa County Medical Center in Greensburg, said “We appreciate Senator Moran’s continued support of rural healthcare. This funding recognizes the unique challenges that rural hospitals face and the important role we play in our communities. At Kiowa County Memorial Hospital, it means greater stability, more opportunities to enhance services, and the ability to continue providing compassionate, quality care close to home. This investment isn’t just in hospitals—it’s an investment in the people and communities we serve.”

CMS Authorizes Enhanced Payments for Rural Hospitals

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