Rural Health Implications for HHS Reorganization of HHS Regional Offices

The Regional Offices at the Centers for Medicare and Medicaid Services (CMS) play a critical role in ensuring the implementation and administration of Medicare, Medicaid, and other health programs across the country. CMS Regional Staff duties include monitoring compliance with federal regulations, providing support and guidance to state governments and health care providers, and addressing concerns or complaints from beneficiaries. Additionally, these offices work to promote public understanding of CMS programs by engaging with local communities and stakeholders. By maintaining a regional presence, they are better positioned to address specific needs and challenges unique to their respective areas, ensuring a more localized and efficient approach to health care administration. 

Reducing the number of local CMS regional offices will have a negative impact on rural health care and rural health providers, including Rural Health Clinics (RHC) and rural hospitals.

Rural Health Clinics: The reduction in the number of CMS regional offices in certain areas of the country will result in an increase in wait times for an RHC designation and the issuance of billing numbers. Currently, even with ten regional offices, RHCs often experience significant delays in receiving their billing numbers after passing the necessary surveys. These delays are not just a matter of inconvenience—they pose a critical financial burden. Delaying the functional and billing operations of potential RHCs will constrict access to care for residents of rural areas. RHCs, which operate on thin margins, must continue to see patients without receiving reimbursement until their billing numbers are issued. Each day of delay compounds financial strain, pushing some clinics to the brink of closure. 

Rural Hospitals: Rural hospitals are threatened with closure due to financial pressures, and currently, CMS regional offices provide guidance on necessary changes in structure. For example, in the Pacific Northwest, there are hospitals facing imminent financial collapse. Changing regulatory and reimbursement structures, such as a shift from a Prospective Payment System (PPS) hospital to a Critical Access Hospital (CAH), may be one way to continue operations for a distressed hospital. However, a change such as this is complex and requires advice by regional CMS offices, who have experienced personnel to provide guidance on issues such as eligibility and application processing.

Impact on Rural Beneficiaries: By closing or consolidating CMS offices, hospitals and patients will lose experienced CMS staff—individuals whose expertise ensures timely regulatory guidance, consistent compliance oversight, and responsive support. With fewer personnel, the remaining staff will be overburdened, causing slower response times, inconsistent technical assistance, and potential regulatory confusion for rural providers. This loss of experienced staff may lead to inconsistent enforcement of regulations across regions, increasing the risk of unintentional non-compliance among rural providers.

Moreover, reducing the number of CMS regional offices could lead to a loss of localized knowledge and responsiveness, further disconnecting CMS policies from the real-world needs of rural providers. The CMS offices are not just administrative entities but trusted partners that understand the unique challenges of rural health care. Without the local presence of CMS offices, the support that our rural providers rely on will become more distant and more difficult to access. In addition, the closure of these offices might make it more difficult to address the unique needs of individual regions, such as the Pacific Northwest, or others, effectively.

For rural providers, which already struggle with workforce shortages, limited resources, and high patient demand, the consequences could be devastating. Some clinics and hospitals may be forced to close, leaving rural populations without access to essential health care services. Others may find themselves burdened with unsustainable debt as they wait for reimbursement approval. Ultimately, this reorganization threatens to deepen existing disparities in health care access, directly undermining efforts to improve the health of underserved patients. 

We strongly urge CMS and HHS to reconsider this reorganization. Rather than reducing the number of Regional Offices, the focus should be on streamlining and improving processes within the existing structure. Rural communities cannot afford a one-size-fits-all approach. Delays and reduced support for rural providers directly threaten the health and well-being of underserved populations.