A critical access hospital (CAH) is a rural hospital that its state designates and CMS certifies under 42 CFR 485.606, and that meets the status, location, bed and length-of-stay conditions in 485.610 and 485.620. Medicare pays a CAH 101 percent of reasonable costs for inpatient services other than distinct part unit services and EHR incentive items, or 100 percent for a CAH that is not a qualifying CAH for the applicable EHR reporting period, unless an exception applies (42 CFR 413.70(a)(1) and (a)(6)). Integral Healthcare Solutions (IHS) builds the criteria worksheet, transition timeline and policy conversion map, and drafts a state application packet that hospital leaders review and file.
Last reviewed: November 5, 2026. CFR text read in eCFR form that day (title 42 last amended October 8, 2026).
What is critical access hospital designation?
For most hospitals, two steps. First, 485.606(a)(1) provides that "A State that has established a Medicare rural hospital flexibility program described in section 1820(c) of the Act may designate one or more facilities as CAHs if each facility meets the CAH conditions of participation in this subpart F." Second, under 485.606(b)(1) CMS certifies a facility that "is designated as a CAH by the State in which it is located and has been surveyed by the State survey agency or by CMS and found to meet all conditions of participation in this part and all other applicable requirements for participation in part 489 of this chapter." Section 485.606(b)(2) is a second route, for a Montana medical assistance facility or a rural primary care hospital CMS designated before August 5, 1997, that is otherwise eligible for state designation.
Which kinds of facility can convert?
Section 485.610(a) lists three: a currently participating hospital that meets all conditions of participation in the subpart; a recently closed facility that was a hospital which "ceased operations on or after the date that is 10 years before November 29, 1999"; and a state-licensed health clinic or center that was a hospital downsized to one. The last two must also meet the designation criteria on the effective date.
What rural location test applies?
A CAH must meet 485.610(b)(1) or (b)(2), or a transition provision in (b)(3) to (b)(5). The (b)(1) route has two parts, both required: the CAH "is located outside any area that is a Metropolitan Statistical Area, as defined by the Office of Management and Budget," and not recognized as urban under 412.64(b), subject to the exclusion written into that sentence; and it has not been classified as urban for the standardized payment amount under 412.230(e) or redesignated to an adjacent urban area under 412.232. The (b)(2) route covers a hospital inside a Metropolitan Statistical Area that is "treated as being located in a rural area in accordance with § 412.103 of this chapter." Paragraphs (b)(3) to (b)(5) are OMB-area-change transition provisions with county conditions.
What distance test applies?
Section 485.610(c)(1) states that the CAH "is located more than a 35-mile drive on primary roads (or, in the case of mountainous terrain or in areas with only secondary roads available, a 15-mile drive) from a hospital or another CAH, or before January 1, 2006, the CAH is certified by the State as being a necessary provider of health care services to residents in the area." Paragraph (c)(2) defines primary roads as a numbered Federal highway including interstates, intrastates, expressways, or any other numbered Federal highway with 2 or more lanes each way, or a numbered State highway with 2 or more lanes each way. IHS's reading, as of November 5, 2026, is that a new conversion relies on the distance test. Confirm with your state.
Which later rules can end the location status?
Under 485.610(e)(2), an off-campus provider-based location (excluding a rural health clinic) or off-campus distinct part psychiatric or rehabilitation unit created or acquired on or after January 1, 2008 must itself be more than a 35-mile drive on primary roads (15 in the terrain case) from a hospital or another CAH, for the CAH to keep meeting the location requirement. Under (e)(3), a CAH that creates or acquires such a site failing (e)(2), or co-locates on or after January 1, 2008 failing (e)(1), is subject to termination of its provider agreement under 489.53(a)(3), unless it ends the arrangement. Under (e)(1), a necessary provider CAH that is co-located with another hospital or CAH (sharing a campus) keeps meeting the location requirement only if the co-location was in effect before January 1, 2008 and the type and scope of services of the co-located facility do not change.
How many beds and what length of stay?
Section 485.620(a) reads: "Except as permitted for CAHs having distinct part units under § 485.647, the CAH maintains no more than 25 inpatient beds. Inpatient beds may be used for either inpatient or swing-bed services." Section 485.620(b): "The CAH provides acute inpatient care for a period that does not exceed, on an annual average basis, 96 hours per patient."
Can a CAH keep a psychiatric or rehabilitation unit?
Yes, in a distinct part unit. Under 42 CFR 485.647, the unit has no more than 10 beds, outside the 25-bed count and the 96-hour average, and its admissions and days do not count toward the CAH's 485.620 compliance.
Which service rules change the policy set?
Emergency services must be "available on a 24-hours a day basis" (485.618(a)). Except for the temporary registered nurse provision in 485.618(d)(3), a physician, physician assistant, nurse practitioner or clinical nurse specialist with training or experience in emergency care must be on call, immediately available by telephone or radio contact, and available on site 24 hours a day within 30 minutes, or within 60 minutes only if all three conditions hold: the CAH is in a frontier area or a remote location under its state's rural health care plan as approved by CMS, the state has determined that a longer response time is the only feasible method, and the state maintains documentation (485.618(d)(1)). Since July 1, 2025, 485.618(e) requires, scaled to the complexity and scope of services offered, adequate emergency provisions and protocols, and annual training for the applicable staff the CAH identifies.
If a CAH offers obstetrical services, 42 CFR 485.649 applies: paragraphs (a) and (b) took effect January 1, 2026, and paragraph (c), on staff training policies with initial and biennial training for staff the governing body identifies, takes effect January 1, 2027.
Who needs it and what triggers it
- A small rural hospital testing itself against 485.610 and 485.620.
- A hospital with off-campus sites or a distinct part unit (485.610(e), 485.647).
State application steps vary; your state rural health office and survey agency are the source.
How IHS helps
CAH readiness is compliance services. Thomas G. Goddard, JD, PhD, who founded IHS in 2002 and served as URAC's Chief Operating Officer and General Counsel, leads it.
- A criteria worksheet that tests your hospital against 485.606, 485.610 and 485.620, with a data owner for each test and each off-campus site mapped against 485.610(e).
- A transition timeline covering designation, survey and policy conversion.
- A policy conversion map from your current policy set to the CAH conditions, including 485.618 and, if you offer obstetrics, 485.649.
- A draft state application packet for your leaders to review and file.
What you supply: your leaders, who file the state application; your finance staff, who analyze financial feasibility; and the distance, bed and length-of-stay data.
The real limit: IHS does not decide designation or file with the state, CMS or any agency; the state designates, CMS certifies and your hospital files.
What to have ready
- Your status path under 485.610(a), and a location review under 485.610(b), including any urban classification or redesignation history.
- A drive-distance record under 485.610(c)(1) for the main campus and each off-campus site, with each site's creation or acquisition date, using the primary-road definition in (c)(2).
- A bed count and length-of-stay data to test the 96-hour annual average, under 485.620.
- Emergency coverage rosters and response-time records (485.618), and an obstetrical services statement (485.649).
- Your state's designation process documents.
- Your finance staff's feasibility analysis.
Start with the free introductory call.
How it compares
Under 42 CFR 413.70(a)(2), cost payment for CAH inpatient services excludes physician and other professional services, except as 413.70(a)(3) provides for anesthesia by qualified nonphysician anesthetists. Whether conversion pays turns on the hospital's costs, payer mix and state rules; IHS does not recommend either path.
A hospital with little inpatient demand may weigh a Rural Emergency Hospital conversion, and a CAH planning post-acute care can read about swing bed readiness. Our ACHC critical access hospital page covers accreditation of an existing CAH, not designation.
What it costs
Government: the CAH sections above set no designation fee, and state application costs depend on your state. Under 42 CFR 424.514(a), a prospective institutional provider's initial Medicare enrollment application must come with the applicable fee, a hardship-exception request, or both. The CAH sections do not say whether a conversion filing counts as an initial application; confirm that and the current fee with your Medicare Administrative Contractor. Consulting: IHS scopes each engagement after a free introductory call, based on the number of sites, the policies to convert and how far your data is from the criteria.
What this is not
- It is not legal advice or a financial opinion; IHS is not a law firm.
- It is not a designation. The state designates and CMS certifies.
- It is not a guarantee that a hospital qualifies.
Frequently asked questions
What are the basic criteria for critical access hospital status?
The state designates the facility, and CMS certifies it once the state designation is in place and a survey finds it meets all conditions of participation and the applicable part 489 requirements (485.606). The facility also needs an eligible status, a rural location, distance from other hospitals unless a grandfathered route applies, no more than 25 inpatient beds, and an annual average acute stay of 96 hours or less (485.610, 485.620).
How is the 35-mile distance measured?
It is a drive on primary roads to a hospital or another CAH, and 15 miles in mountainous terrain or where only secondary roads are available. 42 CFR 485.610(c) defines primary roads. Apply it with your counsel and state.
Is the necessary provider route still available?
The text allows it only where the state certified the CAH as a necessary provider before January 1, 2006 (42 CFR 485.610(c)(1)). IHS's reading, as of November 5, 2026, is that a new conversion relies on the distance test. Confirm with your state.
How many beds can a CAH keep?
No more than 25 inpatient beds, plus up to 10 beds in a psychiatric or rehabilitation distinct part unit, which sit outside the count (485.620(a), 485.647(b)).
What is the length-of-stay rule?
Acute inpatient care must not exceed, on an annual average basis, 96 hours per patient (485.620(b)).
Can a CAH keep a psychiatric unit?
Yes, in a distinct part unit of no more than 10 beds that complies with 42 CFR part 482, subparts A through D, 412.25(a)(2) through (f) and 412.27 (42 CFR 485.647).
Does a new off-campus clinic or unit affect CAH status?
It can. A site created or acquired on or after January 1, 2008 must itself be more than a 35-mile drive on primary roads (15 miles in mountainous terrain or where only secondary roads are available) from a hospital or another CAH, for the CAH to keep meeting the location requirement. Rural health clinics are excluded (42 CFR 485.610(e)).
Does IHS decide whether we qualify or file the application?
No. The state designates, CMS certifies, and your hospital files. IHS drafts the packet and does not communicate with the state or CMS for you.
What does IHS draft and what do hospital leaders file?
IHS drafts the criteria worksheet, transition timeline, policy conversion map and state application packet. Hospital leaders review, approve and file it.