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Non-rural Providers Can Qualify for American Rescue Plan's $8.5 Billion Rural Fund, Modern Healthcare

September 29, 2021

The Health and Human Services Department announced in early September $8.5 billion in COVID-19 stimulus funding to rural healthcare providers—however, eligibility hinges on whether the patients are rural, not the providers. The grants are part of the American Rescue Plan (ARP), a sweeping, $1.9 trillion pandemic relief package Congress approved in early 2021.

The text of the ARP includes a provision that defines a rural provider as being located in a metropolitan statistical area with fewer than 500,000 residents, but the Health Resources and Services Administration has taken a different approach to implementing the law: focusing on “rural designation of the patient,” not the provider. Speaking with Modern Healthcare, partner Greg Etzel said, “It's not surprising that large, multi-hospital systems would apply for the rural relief funds … Congress appears to have sought to make the reach of those funds broad enough to encompass the rural communities served by such hospitals whether or not the hospital itself is situated in a rural area.”

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