Rural Hospital Flexibility Program

Background/history

The design of the Medicare Rural hospital Flexibility (Flex) Program was in part based on a Medical Assistance Facility (MAF) demonstration project concept by the Director of the Montana Department of Health and Environmental Services (DHES) in late 1985 along with the formation of a Montana Rural Health Task Force by DHES in 1986. MAFs were initially developed through a joint venture between the then Quality Assurance Division (QAD) and the Montana Health Research and Education Foundation (MHREF), a subdivision of the Montana Hospital Association, through a demonstration project grant received by MHREF in 1987. Medicare waivers were received in 1990.  The Flex Program was established by the Balanced Budget Act of 1997. Any state with rural hospitals and a State Rural Health Plan may establish a Flex Program and apply for federal funding.  DPHHS is the designated Flex Program awardee, and by appointment of the Governor, the Office of Inspector General currently manages the Flex award.  Flex legislation also created critical access hospitals (CAHs) as a Medicare provider type. Montana currently has 50 CAH-designated facilities.  The Medicare Beneficiary Quality Improvement Project (MBQIP) reporting is a requirement for CAHs to participate in Flex Program.

Montana received its first Flex award in September 1999 and this joint venture with MHREF continues.

The Flex Program requires states to develop Rural Health Plans and funds state's efforts to implement community-level outreach in the following program areas:

  1. CAH Quality Improvement (required)
  2. CAH Operational and Financial Improvement (required)
  3. CAH Population Health Improvement (optional)
  4. Rural Emergency Medical Services (EMS) Improvement (optional)
  5. Rural Innovative Model Development (optional)
  6. CAH Designation (required if requested)

 The current Montana Flex Program work plan includes activities in Program Areas 1, 2, 3, and 4.

This program is supported by the Health Resources and Services Administration (HRSA) of the U.S. Department of Health and Human Services (HHS) as part of an award totaling $928,510 with zero percentage financed with nongovernmental sources. The contents are those of the author(s) and do not necessarily represent the official views of, nor an endorsement, by HRSA, HHS or the U.S. Government.

State Rural Health Plan

The primary purpose of Montana’s Rural Health Plan July 2011 was to guide Montana’s Critical Access Hospital (CAH) program and future Rural Hospital Flexibility (Flex) Program grant expenditures. This document was also intended for use by other rural, Montana health care stakeholders to assist them in the work they do. The plan was developed with input from the Montana Rural Health Plan Task Force, a broad-based group of rural health care leaders and representatives dedicated to rural Mon­tana. In preparing this plan, the Task Force focused on the current status of health care in Montana and on the issues presenting the biggest challenges in today’s changing health care landscape. This health plan looked at the trends, the challenges and the approaches needed to ensure that rural Montanans receive excellent health care across the lifespan and across the state.

The Task Force utilized existing data and information from a variety of state and national sources while keeping an over-riding goal of creating a useful, practical guide for the future for Montana’s critical access hospitals that is fact‐based and data‐driven. Montana’s Rural Health Plan 2011 was intended as a flexible document, responsive to the changing needs and landscape of Montana. The Montana State Rural Health Plan was updated in 2021.

A link to the current plan can be found in the related links.