Core Competency: Improving Financial Sustainability

Changing market forces and payor reimbursement have been challenges for decades. Market forces continue to evolve and contribute to financially stress small rural hospitals. This financial distress has led to the closure of numerous rural hospitals while several hundred are currently classified as financially distressed. Similar to QI, state Flex Programs are not expected to be financial and operational improvement experts. However, state Flex Programs should have a basic understanding of financial and operational improvement principles to best support project partners, serve as a resource, develop project plans, establish, and implement initiatives, share best practices, and report program outcomes. They should also know how and where to access financial and operational technical expertise, such as TASC, and access and use financial data, such as CAHMPAS.


  • Recognize the basic concepts of CAH and rural health clinic (RHC) payment
  • Understand how CAH financial data are reported, analyzed, and acted upon
  • Describe what each of the most important CAH financial measures means, and how each affects the hospital’s overall financial performance
  • Explain the basic concepts of value-based payment for rural providers
  • Analyze a rural hospital’s financial performance over time and identify hospitals in financial crisis and in danger of closing
  • Understand the basic strategies for improving the financial performance of rural hospitals and clinics
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National Rural Health Resource Center


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