Alabama Flex Grant Program

The Medicare Rural Hospital Flexibility (Flex) Program was established by the Balanced Budget Act (BBA) of 1997. Any state with rural hospitals may establish a Flex Program and apply for federal funding from the Federal Office of Rural Health Policy (FORHP),  that provides for the creation of rural hospital networks, promotes regionalization of rural health services and improves access to hospitals and other services for rural residents.

Alabama's Flex Grant Program is administered by the Alabama Department of Public Health (ADPH) through the State Office of Rural Health (SORH) and a cooperative agreement with the Alabama Hospital Association (AlaHA). Representatives from each form the Alabama Flex Grant Oversight Committee, which provides direction to the program. 

The BBA of 1997 also created the Critical Access Hospital (CAH), a designation given to eligible rural hospitals by the Centers for Medicare and Medicaid. The CAH designation allows the hospital to be reimbursed on a reasonable cost basis for inpatient and outpatient services provided to Medicare patients and, in some states, Medicaid patients (including lab and qualifying ambulance services). 

Eligible hospitals must meet the following conditions to obtain CAH designation: 

• Have 25 or fewer acute care inpatient beds
• Be located in a rural area and more than 35 miles from another hospital (exceptions may apply)
• Maintain an annual average length of stay of 96 hours or less for acute care patients
• Provide 24/7 emergency care services

Alabama hospitals that wish to become a CAH, must complete an Application for Change in Licensure and Change in License Supplement A Application. For instructions, see CAH application instructions. 

For additional information see: CAH designation status and benefits.

OPCRH and AlaHA support Flex hospitals by assisting Alabama's five CAHs in their pursuit of financial viability and quality improvement initiatives. They further support Flex hospitals by collecting and disseminating health-related information, coordinating rural resources, providing technical assistance, and promoting recruitment to improve access. Flex funding encourages the development of cooperative systems of care in rural areas, joining together CAHs, emergency medical service (EMS) providers, clinics, and health practitioners to increase efficiencies and quality of care. The Flex Program requires states to develop rural health plans and funds their efforts to implement community-level outreach.

The Alabama Rural Health Plan was originally developed in 1999 in coordination with representatives from rural hospitals, AlaHA, and OPCRH as required by federal legislation to create a strategic plan for the Alabama Flex Program. 

• Alabama Rural Health Plan (Updated 2016)

CAH Hospitals in Alabama:

1. Medical Center Barbour
2. Ochsner Choctaw General Hospital
3. Red Bay Hospital
4. Tanner Medical Center - East Alabama
5. UAB St. Vincent's Blount
6. Washington County Hospital

Alabama Flex Program Initiatives

Quality Improvement 

Alabama’s critical access hospitals (CAHs) participate in quarterly network meetings with the Rural Quality Network (RQN), where participants work to address specific quality measures. Hospitals share best practices and tools to address the Emergency Department Transfer Communication (EDTC) and the Medicare Beneficiary Quality Improvement Projects (MBQIP) measures along with Hospital Compare measures.  

The MBQIP focuses on improving the quality of care that CAHs provide. CAHs that wish to participate in Flex-funded activities must participate and report in MBQIP core quality measures.

Alabama’s CAHs also participate in nationwide Quality Improvement Labs (QIL). Through in-person meetings, webinars and network collaboration, Alabama’s CAHs are improving the quality and standards of care for patients in their communities. Internal data collection and reporting have also improved as a result of QIL participation.

Financial & Operational Improvement

Flex funds are utilized to assist Alabama’s CAHs with feasibility studies on a rotating basis. Financial feasibility studies, conducted by a national consultant, are in-depth reviews of the hospital’s cost report resulting in recommendations to improve the financial and operational performance. Participation in the swing bed project also addressed the impact of swing beds and the financial bottom line of hospitals. A four-part cost report training webinar series was hosted by a consultant for CAHs to be able to expand their knowledge of completing the cost report and the impact the cost report had on reimbursement rates.

Population Health Improvement 

The Alabama Flex Program continues to encourage the identification of areas for improvement with defined targets and measurable outcomes. A minimum standard of reporting on outcomes is requested from the participating state programs. The Alabama Flex Program identifies through the RQN our hospitals’ evolving needs from the current industry and rural healthcare environmental factors. Any barriers which hinder CAHs ability to continuously improve rural population health; the Alabama Flex Program will work to strategically address and assist. Through targeted workplan activities, contracted consultants, professional development education, investment value analysis, and technical assistance; the program seeks to continuously facilitate and improve our CAH’s impact and value to rural populations across our state.

Strategic Partnerships & Non-Traditional Partners

The Alabama Flex Program is always looking for ways to cultivate intra/inter-agency collaboration across our state and this country. We believe industry collaboration is a force multiplier and that our combined efforts will provide an even greater impact on the providers and patients we serve. If your organization has a rural health-related initiative, please don’t hesitate to contact our office anytime at (334) 206-5396.

We will look forward to speaking with you.

Any additional questions or technical assistance regarding Alabama Flex Grant Program should be directed to FLEX/SHIP Program Manager Stanley Woodson via email or (334) 206-5441.