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Rural Definitions and Data: Changes after the 2020 Census

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Rural Definitions and Data: Changes after the 2020 Census


Date:


Duration: approximately

minutes


Featured Speakers










Sarah Heppner

Sarah Heppner, Federal Office of
Rural Health Policy

Steve Hirsch

Steve Hirsch, Federal Office of
Rural Health Policy

Greta Stuhlsatz

Greta Stuhlsatz, Federal Office of
Rural Health Policy



The Census Bureau and the White House’s Office of
Management and Budget (OMB) have been releasing new data
from the 2020 Census this year that will affect how
federal resources are directed to rural areas in the
United States.



Both the Census and OMB made adjustments to their
criteria prior to the release of the Census 2020 data.
The Census Bureau made the most significant changes to
how they define urban and rural areas in over a century.



This webinar will review how rurality is defined by the
federal government, what changes in these definitions
were made recently, and how this may affect rural areas’
eligibility for federal funding.



From This Webinar









Transcript



Kristine Sande: I’m Kristine Sande and
I’m the program director of the Rural Health Information
Hub. And I’d like to welcome you to today’s webinar and
we’re happy to be doing this webinar on rural definitions
in partnership with the Federal Office of Rural Health
Policy. We have provided a PDF copy of the presentation
on the RHIhub website and that’s accessible through that
URL that’s on your screen. And now it’s my pleasure to
introduce our speakers for today’s webinar. First is
Sarah Heppner. Sarah serves as the associate director of
the Federal Office of Rural Health Policy in the Health
Resources and Services Administration of the U.S.
Department of Health and Human Services. In that role,
Sarah provides programmatic policy and operational
support for the office. Sarah has been with FORHP since
2012, serving as the research coordinator, the deputy
director of the Office of the Advancement for Telehealth,
and the director of the Policy Research division.



Our next speaker will be Steve Hirsch. Steve is the
semi-retired rural guru with FORHP, and he has worked for
FORHP for over 20 years, and prior to that was an
information specialist at the Rural Information Center’s
Health Services. He now lives in a semi-rural area of
Maryland. And we’ll also hear from Greta Stuhlsatz. She’s
a statistician with FORHP, where she supports data
activities for the office, including analysis,
evaluation, and visualizations. She has worked for the
Federal Government since 2012 and has previously worked
for a research and capacity-building center in Kansas.
And with that, I’ll turn it over to Sarah.



Sarah Heppner: Thank you so much for
joining us today, and thanks to my colleagues, Steve and
Greta for inviting me to be part of their presentation. I
wanted to start by just setting the stage a little bit
for this webinar and making sure that everyone knows who
we are and why we care about rural definitions. We are
all part of the Federal Office of Rural Health Policy, or
FORHP, for which was created by Congress in 1987.
Technically, we were just the Office of Rural Health
Policy when we were created, and our office plays two
main roles. The first is to administer grant programs
designed to build healthcare capacity at the local and
state levels. Our grants are designed to strengthen
health networks, enhance healthcare delivery in rural
communities, provide technical assistance and support to
rural hospitals, and to address barriers to treatment for
substance use disorders. The second is to act as the
voice for rural across HHS, by coordinating activities
related to rural healthcare within the Department of
Health and Human Services.



We have a department-wide responsibility for analyzing
the possible effects of policy on residents of rural
communities. And woven into both of these roles is a need
to understand the numerous federal and state level
definitions of rural that have been created over the
years. As part of our office’s larger efforts to support
rural communities and other rural stakeholders, we
provide technical assistance on what all of these various
ways to define rural actually mean. So today, two of
those experts, Steve and Greta, are going to provide some
history and some explanation to a few of the most common
definitions that are currently in play. So, without
further ado, let me turn things over to Steve. Thanks,
everyone.



Steve Hirsch: Thank you Sarah, for the
intro and thanks Kristine and the RHIhub staff for making
sure I got online and I’m able to do this. Why do rural
definitions matter? Sarah just kind of covered that.
Federal program funding often goes to places that have
the most population so that larger numbers get more
resources. There are programs, however that are targeted
for rural populations, and those have to rely on some
kind of criteria to target the funding. So the way rural
is defined can determine who’s eligible to receive
federal resources. And this is a newspaper story that
appeared on the front page of the Washington Post a
little over 10 years ago. And if you can read the fine
print, Lenoir is a small town in western North Carolina
with 18,000 people. Is it rural? The U.S. Government has
an answer. Yes, no, and it depends. Yes, yes. No, no, no,
no.



The reporter identified at least 15 official definitions
of the word rural that are applied by the Federal
Government, and there are probably more than that. That’s
a low number. And one of the reasons there are so many
different definitions is that some of them are statutory.
Congress might write into a law and specify how rural
should be defined, and others are programmatic. That is
that the programs are left to decide how to identify
what’s rural and what’s not, and therefore, how to direct
resources. And there are good reasons that there may be
different definitions used by various agencies, depending
on what the program is aiming to do and how large the
population is that they want to help. One of the few
things that’s written in the Constitution that the
government has to do is perform a census every 10 years.
And it’s Article 1, Section 2, and it says they started
immediately with the start of the U.S., soon after the
Constitution was ratified and have done it every 10 years
since then.



And so, we have a really good snapshot of what the U.S.
population looks like every 10 years since 1790. And
occasionally, I’ve seen some people who seem to believe
that the founders wrote into the Constitution some
protections to make sure that rural voters wouldn’t be
overwhelmed by the mass of urban voters in the U.S., but
that’s something I find extremely unlikely, if not
impossible. And the next slide, I’ll be able to show you
why. The blue line is the urban population of the U.S.
and the red line is the rural population of the U.S.. And
these numbers are based not on how people were classified
at the time, but it’s a retroactive look back done by the
Census Bureau. But easily only 5% of the population of
the U.S. could be considered urban in 1790. 95% of the
population was rural. And really, that is the way ever
since civilization started, that the overwhelming number
of people did not live in large cities or even large
towns.



They lived in rural areas because they had to produce
food that they could eat. When you have a scale here that
runs from under 3 million to over 300 million,
essentially starting in 1790, the urban population
doesn’t even show up. Back then, 200,000 people might’ve
been considered rural out of a population of almost 4
million in 1790. And it isn’t until about 1830 that you
can even see the beginning of the urban population
starting to show up on this graph. By 1920 though, the
urban population exceeds the rural population, the first
time that it went over 50% of the population. And after
that, obviously the urban population surges by a huge
amount so that you have 80% of the population is rural by
2010 or 2000. And the urban population continues to grow.
But one of the interesting things to note is that around
1980, the rural population is classified by the Census
Bureau, settles in around 60 million and stays there
through 2010.



So, a good 30 years. The rural population didn’t really
shrink in overall numbers, but it didn’t grow either. It
was the urban population that surged. And then in 2020,
due to some changes mostly that the Census Bureau made in
how they define rural, which we’ll discuss later, the
population grows by a sudden 6 million people up to 66
million, as classified after the last census. So, what
happened? Why did the urban population surge in such a
way in comparison to the rural population? And the answer
is agricultural productivity. In 1870, almost half of
people who worked, worked in agriculture, and by 1980,
just 4% of employed people were in agriculture and each
one supplied food for nearly 70 more people beyond that.



So, it’s a huge, huge change in agricultural productivity
that enabled people to leave rural areas if they wanted
to leave rural areas, or perhaps had to leave rural areas
because jobs were no longer available in agriculture,
with so much more productivity. Just to give you an idea,
in 1910, 12 million people worked on farms, and by 2000,
that number had shrunk by a huge margin down to 1.6
million. So about 90%, 96% of farm work had farm workers,
people were no longer required to work on farms. So, the
urban population took off as agricultural productivity
allowed, and farm machinery allowed people to leave the
farms and go elsewhere and find jobs. So, the Census
Bureau, and this is from a publication on the Census
Bureau’s website, began identifying urban places
following the 1870, 1880, and 1890 censuses. And what
they were doing was looking at towns with at least 2,500
people and classifying them as urban. And then everything
else is considered rural.



And in large part, that’s how the Census Bureau continues
to identify urban and rural. Everything that’s not
considered urban is rural. They’re not really defining
what rural is, it’s more a definition by exclusion. So,
anything that’s not urban is considered rural. And why
did they pick towns of 2,500 people? And I’m not sure
that they know exactly why the Census Bureau around that
time defined a population cutoff of 2,500 people, other
than they probably considered any town that had 2,500
people as having a sufficient base of population to
support any needed services.



Whereas today, we would think of a town of 2,500 people
as being a tiny, small place. That continued to be used
essentially as the basic definitions as, through 1950
they always were considering incorporated places, so
anything outside of the city limits became rural. And for
towns with 2,500 or more, and those were considered
urban. But beginning in 1950, the census realized that
there were suburbs growing up around large cities, and
these suburbs were integrated with the city, even if they
were not within the city limit. So, they began to look at
population density and to, as long as the population
density did not fall below 1,000 people per square mile,
they would consider it to be urban. And they also
considered places with population density as low as 500
people per square mile, because of parkland, schools,
commercial or retail or industrial areas could be
included within the urban area.



So, below the 50,000, they did not apply this density
screen to areas around those towns. So, anything from
2,500 up to 49,999, it was still within the city limits
that was considered urban and everything outside was
considered rural. So, with the 1990 census and with
technological advancements and computing power, they
could now apply the density criteria across every kind of
town in the U.S. from 2,500 or more people. They could
look at density surrounding those towns and include
urbanized areas outside of the city limits. And so that
began to happen in 1990. With 2000, the Census Bureau
began to distinguish two different kinds of urban areas.
So, they had urbanized areas that have at least 50,000
and went up to however far it went, and urban clusters,
which had a core that started at 2,500 people but had
fewer than 50,000 peoples. Now, the Rural Health Clinic
program, as Congress wrote it, identified that Rural
Health Clinics could be cited in areas that were not
urbanized.



So, urban clusters could be considered rural for the
purposes of citing a Rural Health Clinic. There are
criteria for citing Rural Health Clinics, that they’d be
located in a HPSA, Health Professional Shortage Areas.
But in essence, any town under 50,000, any urbanized core
that had less than 50,000 could be the site of a Rural
Health Clinic. And that allowed many towns to have them
within their town limits. Sort of counterintuitively, if
you can see, there’s a pink area here, which represents
the urbanized areas of the United States. And there are
green dots which represent the urban clusters. So, towns,
urban cores of under 50,000 people. You may notice that
there’s lots of white space. That’s all the rural area of
the United States. Most of the United States by far is
rural by the Census Bureau’s definition, most of the area
of the United States, 80% of the people in the U.S. live
in the green dots in the pink area.



So, that’s only less than 5% of the land area of the
United States. But over 95% of the land area of the
United States is considered rural by the Census Bureau,
and that includes some suburban area that doesn’t reach
the population density. So, pretty quickly you can get
under 1,000 or 500 people per square mile. Now, the
Office of Management and Budget at The White House
delineates metropolitan and micropolitan statistical
areas. They started out only doing metropolitan areas,
and back in essentially 1949, the core areas had to have
50,000 people. The difference between what the Office of
Management and Budget, OMB does and what Census does, is
that OMB is designating whole counties. Census is using
much smaller areas, census blocks as the building block
to develop urban areas. But if a county is part of a
metro area, the whole county becomes considered metro,
without any regard to how densely populated it is or
pretty much any other considerations currently.



So that the Grand Canyon is my favorite example. The
Grand Canyon is a metropolitan area because it’s in a
county that has Flagstaff, Arizona in the southern part
of the county. Starting really with 2000, which is when
they began to designate micropolitan areas in addition to
the metro areas. So, they began to talk about Core Based
Statistical Areas. So, there are two types of Core Based
Statistical Areas, the metro areas that have a core
population of 50,000 or more, and then micropolitan areas
that start with a core population of 10,000 but less than
50,000. And they work similarly. They take the core
county that has the urban core, and then they look at
commuting patterns to look at which counties are
economically integrated with the core area and build out
from the central counties. So, there are outlying
counties and there are central counties within both
metropolitan and micropolitan areas.



The criteria for qualifying as a central county of a
core-based area is at least 50% of the population, or has
a large slice of the urbanized population within the
county. The outlying counties are more or less based on
commuting patterns so that at least 25% of their workers
are commuting into the central area, or workers from the
central area are commuting out into outlying counties.
So, this is how the metro areas looked back in 1950. To
me, it’s interesting to note that there’s several states
that don’t have any metropolitan areas, states like
Idaho, Montana, North Dakota for example, don’t have any
metropolitan areas. And one of the things that also is
interesting is that if you look at Southern California,
the Los Angeles metro area stretches all the way from LA
to the borders of Nevada and Arizona. And one of the
reasons for that is that San Bernardino County is in that
large black metro area, and San Bernardino County has
about 20,000 square miles, an area larger than the state
of Delaware.



In fact, it’s about 10 times larger than the state of
Delaware. And so, a metro area, when you get out in the
eastern part of San Bernardino County, you’re sort of out
in Death Valley area, where there are very few people
living. So again, by including the whole county, OMB is
getting what isn’t just rural but maybe considered
frontier or practically unpopulated areas. And sorry
about the map being divided in half, but that’s how I
found it. By 1980, every state had some metro area, even
Alaska did. And as you notice, the metro areas have grown
and are much larger and cover a lot more area of the
United States, but still not the majority of the area.
But even in 1980, there is far less. There’s still far
more non-metro area than there is metro area. I mentioned
some ways that metro and non-metro are sort of
counterintuitive, and one is that you can have commuting
in reverse.



And this is from an article by Ken Jennings, who yes, is
the host of Jeopardy! now, but he wrote about Kalawao,
which is the smallest county in the United States by
area. It’s 12 square miles, it’s part of Maui County in
Hawaii, and Kalawao is partly parkland and partly a
Hansen’s disease colony, and it’s extremely isolated. But
Kalawao is part of a reverse commuting. People are
leaving the urbanized core to go work in Kalawao, and
that is pulling it into the metropolitan area. It’s not
that people leave Kalawao and commute into the city. And
there are other examples of this, and one I know of is in
Idaho, where a very sparsely populated county has a
nuclear plant and people are leaving the urban core to go
work out in the nuclear facility, and that is pulling the
whole county into the urban core. So, I’m going to turn
it over to Greta to take it from this point.



Greta Stuhlsatz: Thanks, Steve. Steve
did a beautiful job of explaining the background and also
what’s happened in the past, and how we got to where we
are today. So, I’m going to talk a little bit more about
the more recent history and what we have going into 2020.
With the 2020… I’m sorry, not going into 2020, we’re
past 2020, but moving on with the 2020 census numbers.
So, with the 2020 census, there were three key changes to
urban classifications, which in turn has an effect on
rural classifications because as a reminder, as Steve
said, generally everything that’s not designated as urban
is rural. It’s not necessarily something that is defined
more than it is excluded, and that’s where we come in.
So, the three changes are first, the census is no longer
differentiating between urban clusters and urbanized
areas. Instead, everything is going to be an urban area.
And before, urban clusters were areas with at least 2,500
people and up to 49,999 people, and urbanized areas were
urban areas with 50,000 or more people. So, now those are
all clumped together into urban areas.



Second, housing unit density is incorporated to identify
qualifying census blocks, qualifying as urban areas,
rather than using population density as the primary
indicator. And then third, the minimum threshold for
qualification of an urban area is that the area has
greater than or equal to 2,000 housing units or at least
5,000 persons. Now, these are the three big changes for
2020, but there’s a description of all the changes and
updates. There are a few other minor changes that don’t
have as big of an impact, and those are all available at
the Federal Register notice that’s linked on this slide.
So now, as a reminder, Steve already showed you this map.
This is what the map looked like in 2010, where there was
a differentiation between urbanized areas, which are
shown in purple or pink, and the urban clusters that are
those little dots of green.



And then, this is the current map, where all of the urban
areas are the same there. You can still see that the
majority of land area in the United States is rural, and
it does look very similar to just looking at the maps
visually, the difference is that they’re all being
treated the same instead of showing the difference
between urban clusters and urbanized areas. So, let’s
revisit the Office of Management and Budget, or OMB
designations to see how things have changed over the
years. This chart shows the change in counties and county
equivalents and populations in the United States, and
this doesn’t include outlying territories. So, these
numbers don’t include Puerto Rico. And these show the
numbers every 10 years since 1980. The data is based on
metro and non-metro delineations developed by OMB, where
metropolitan counties and county equivalents are metro
counties, and then micropolitan and all other counties
and county equivalents are in the non-metro category.



The population numbers show estimates from the census
using the OMB delineations, and some patterns to note are
the increase in metro counties, in contrast to the
decrease in non-metro counties. The metro county
population is also increasing, while non-metro population
is decreasing. And there’s many explanations to why these
changes are happening. Steve explained some. Some of it
has to do with people moving to urban areas away from
rural areas. Some urban areas are more condensed and not
as spread out into the suburbs as they may have been in
the past. That’s also happening opposite in some areas,
there’s more of the urban sprawl. And it’s important to
remember the impact of how we measure urban areas. So,
there’s some towns that haven’t changed in population
size at all, but may be reclassified based on the
changing definition.



So again, Steve did an amazing job illustrating the
history of the designations. And the next couple slides
look from 1990 to today, this shows the 1990 OMB
delineations based on the 1990 census. And the green
areas are all metropolitan statistical areas and primary
metropolitan statistical areas. But the different color
gradients show the population size, where the darker the
green, the greater the population is in that area. On
this map, the green areas represent metropolitan and
micropolitan statistical areas from the 2010 census,
where the darker green is highlighting metropolitan
statistical areas, and the lighter green is highlighting
micropolitan statistical areas. And then, if we move to
the next slide, we can see the 2020 delineations. This
shows the most recent OMB delineations, where the dark
blue represents metropolitan statistical areas and the
teal or light blue shows micropolitan statistical areas.
The beige is everything else.



In 2021, OMB proposed some changes to the minimum urban
area population that would qualify to be classified as a
metro statistical area. They wanted to change that
minimum area or minimum population from 50,000 to
100,000. And the justification included that the minimum
population requirement hadn’t kept pace with the
population growth. They were saying that, and this is
true, the United States population has more than doubled
since 1950. And so, with this change, areas with an urban
area population of between 10,000 and 50,000 would
continue to qualify as micropolitan, as they had in the
past. But there are some metropolitan statistical areas
between 50,000 and 100,000 that would also then be
designated as micropolitan. OMB published a request for
comment about these suggested changes. And they did
indeed receive quite a few comments. There were over 700
comments submitted and the vast majority of them opposed
the change.



Many of the comments noted concerns with programmatic
consequences and concerns about the economic development
in areas that would be reclassified as micropolitan,
where they had been metropolitan. In response to the
comments, as well as committee recommendations and
additional reviews, OMB opted to not implement any
substantial changes to the 2020 standards update. And
again, as I said before, the additional information is
available at that link on the slide with the whole list
of the responses to the comments. And so, this is just to
highlight that there is an impact on these changes and
there is… while the OMB and census are very clear that
the delineations that they identify are meant for
statistical purposes, the public comments did illustrate
that there was still concern that there would be
programmatic consequences of those changes and they were
very vocal about that.



So, on this slide, I just want to talk a little bit about
moving beyond the Census and OMB delineations and sharing
that rural means different things to different people,
and it has varied implications depending on program and
funding priorities. So, we’ve talked about the two main
federal definitions, which are from the Census Bureau and
the Office of Management and Budget. The Census Bureau
defines urban areas as areas that represent densely
developed territory. And then rural encompasses all
population housing and territory not included within an
urban area. OMB defines metro and micropolitan
statistical areas that have a core area containing
substantial population nucleus, and they don’t…



The Federal Office of Rural Health policy then can take
those definitions and use them to help define what makes
sense for rural areas. So, these definitions might not
meet the needs of individual programs, research or
funding priorities. And indeed, they don’t focus
specifically on rural. So, alternatives do exist, and
many of them build off the Census and OMB delineations.
Most relevant to us as employees with the Federal Office
of Rural Health Policy is the definition that comes from
our office. This definition includes rural areas that are
all non-metro areas. All non-metro counties are rural
areas, and we use the OMB delineations of non-metro
counties, and these include micropolitan statistical
areas. And then, building on that, all census tracks with
RUCA scores between four and 10 that are in metro
counties. And I’ll explain in a couple of slides what the
RUCA scores are.



And then, adding on top of that, census tracks that are
over 400 square miles, with fewer than 35 people per
square mile and RUCA scores between two and three, that
are in metro counties. And then again, building on that,
all outlying metro counties with no urbanized area
population. So, this map shows all the census tracks and
counties that are eligible for FORHP funding. This map
looks a little opposite of the rest of the maps we’ve
looked at because we are highlighting rural areas, where
most of the other maps you look at are highlighting the
non-rural areas. And we share that the rest of the U.S.
is rural.



So, you can see that rural seems to take up the land
area, rural seems to take up most of the map. This shows
a table of the census, OMB, and FORHP population numbers.
And as you can see here, OMB has the most restrictive
definition, with 46 million people in the rural areas.
And FORHP has the most expansive. The Federal Office of
Rural Health Policy has the most expansive definition,
with 60.85 million people in that rural and non-metro
area. And then the census falls in between there with
59.5 million. And I want to highlight that this is based
on 2010 census data. There’s the RUCA codes, that again
I’ll discuss in a minute, depend on a census commuting
package that hasn’t been released yet. So, once we get
that data and the United States Department of
Agriculture’s Economic Research Services can update their
RUCA codes, we can update our numbers to reflect 2020
census data.



The next few slides, I will go through a couple of other
common coding schemes that can be used for identifying
rural and urban areas. The first is what I keep teasing
that I will talk about soon, the Rural Urban Commuting
Area codes. And these RUCA codes were developed in
combination with the Federal Office of Rural Health
Policy and the U.S. Department of Agriculture’s Economic
Research Service. They are classified using U.S. Census
tract and they use population density, urbanization, and
daily commuting. These mirror theoretical concepts used
by the Office of Management and Budget, but they’re
applied on a more granular level.



So, the Office of Management and Budget identifies
counties. The RUCA codes are for census tracts. There’s
10 primary codes and 21 secondary codes. These are the 10
primary codes that can be used to select a combination of
codes to meet varying definitional needs. So, the Federal
Office of Rural Health Policy uses codes four through 10
in their first level of the definition, and then also
codes two and three when the area is in a large census
tract that’s over 400 square miles, with fewer than 35
people. There’s also another method of measurement that
again comes from the U.S. Department of Agriculture
Economic Research Services, and this is the Frontier and
Remote Area codes. And these are used to identify areas
with a combination of low population size and high
geographic remoteness. And these are by ZIP Code. So, you
may notice a lot of these definitions use different types
of geographies and those are aspects that you can use
when trying to decide which method of measurement might
be most useful, because if you only have ZIP Codes, FAR
codes may be the most useful.



There are levels of FAR codes ranging from one to four,
which can be used again, based on the needs of the person
using the codes. So level one is a rural and urban area
up to 50,000 people that are 60 minutes or more from an
urban area of 50,000 or more people. And then down to
level four, which gets a little bit more information,
rural areas that are 15 minutes or more from an urban
area of 2,500 to 9,999 people, 30 minutes or more from an
urban area of 10,000 to about 25,000 people, 45 minutes
or more from an urban area of 25,000 to 50,000 people,
and 60 minutes or more from an urban area of 50,000 or
more people. And on these next two slides, you can see
the areas that are considered frontier and remote, and
how they change based on the level used.



So, these first two maps highlight the most land area
that’s covered by the FAR codes, level one and level two.
Level three and level four, since they’re a little bit
more restrictive, they contain less land area. A third
delineation, also from the U.S. Department of Agriculture
Economic Research Service considers Rural Urban Continuum
Codes. And these are based on population size, and
whether or not the county is adjacent to one or more
metro areas. So, the metro counties are just based on
population size of the metro area they’re a part of. And
then, the non-metro counties have two different aspects
of their classification. They’re divided into three
urban-sized categories based on the urban population in
the county, and then they’re subdivided on whether or not
that county is adjacent to one or more metro areas.



And this shows that in a little bit more detail with the
exact codes. Metro is one through three, based on
population size. And then, non-metro counties are four
through nine, based on the urban population area and its
adjacency to a metro area. And this map shows the metro
counties, mostly in green, and the non-metro counties
along the Rural Urban Continuum Code. Green areas have
lower Rural Urban Continuum Code scores, while the red
counties have the highest Rural Urban Continuum Code. And
then, I’m going to go ahead and pass it off back to Steve
for our next couple slides and to wrap up the
presentation. Thank you.



Steve Hirsch: All right, so let’s talk
about how federal funding can follow these definitions.
This is from a Brookings Institution report of a few
years ago. “Over 400 programs are open to rural
communities,” they said, and they divided up
the funding streams by the department. So, USDA was by
far the largest, and then Department of Transportation,
and then HHS, but they identified $201 million. That’s
way under undercounting because they are not considering
some of the CMS programs that have differential, I think
reimbursement for rural areas. Now, beyond FORHP funding
streams, our budget, I believe includes about $350
million. That’s putting aside all the pandemic funding
that came through during the pandemic, but the basic
budget for our programs, including the grant programs is
about $350 million. But much of the money for rural
health funding, which is what I’m going to concentrate
on, because that’s the area that we know at best, goes
through Medicare and Medicaid.



And so, much of it is directed to rural hospitals and the
Centers for Medicare & Medicaid Services, rural generally
means hospitals that are outside of a metro area, so
non-metro hospitals, and that includes the micropolitan
counties, they are classified as non-metro. Now,
hospitals in metro areas can be reclassified as rural,
and that means that hospitals that are on the usual
Medicare payment system, the Prospective Payment System,
can ask to be reclassified depending on these criteria
that you can see on the screen. And it’s led to some
interesting recent, in the last few years, where there
are some advantages to being classified as a rural
hospital, including getting Indirect Medical Education
Payments that are higher and being eligible for some
pharmaceutical discounts through what’s called the 340B
Program, Critical Access Hospitals, which I hope most
people on this call are familiar with, make up a large
proportion of the hospitals in the United States.



These are small, rural hospitals. They can’t have more
than 25 inpatient beds, and generally they’re in
non-metro counties, or they can meet the FORHP definition
or be designated by states as rural, but they usually
must be a 35-mile drive from another hospital or a
15-mile drive by secondary roads or mountainous terrain,
and they get increased reimbursement. About 10 years ago,
the last time I saw MedPAC had estimated that this
directed a funding stream of about $2 billion to the
Critical Access Hospitals above what they would’ve
received under the PPS payments if they had been PPS
hospitals. Then there’s also a sole community hospital
designation. A few years ago, there were about 450 of
those in the U.S. and it’s based on hospitals’ distance
in relation to other hospitals and whether a facility is
rural. And generally, again, that means non-metro
hospitals. This is a new designation for hospitals, Rural
Emergency Hospitals, that went into practice in January
of this year. And there have been several hospitals that
have already converted into Rural Emergency Hospitals, so
they get a 5% increase on their outpatient department
services to Medicare patients.



They are still providing emergency services, but they
don’t really have extended inpatient services available.
Rural Health Clinics. Wow. There are about 4,000
certified Rural Health Clinics, which it is certified by
CMS, so they are not just a clinic in a rural area. They
have to be certified by CMS to receive differential
payment under the designation. Now, one of the
interesting or problematic things that happened because
Census eliminated this distinction between urban clusters
and urbanized areas, is that Census now only designates
urban areas which run from a population of 5,000 up to 20
million, which means to me, and apologies to anybody from
the Census Bureau on the line, that it’s not a very
useful distinction. If something goes from 5,000 people
up to 20 million, it’s not extremely effective.



Fortunately, CMS, earlier this or late last year issued
an update that said that they will continue to designate
Rural Health Clinics in areas that were considered urban
clusters as of 2010, and those that are still considered
rural based on the 2020 Census Bureau designation. So,
that was a very good thing for CMS to do so because it
doesn’t simply mean that newly designated Rural Health
Clinics can go into what used to be considered urban
clusters. If a clinic built a new facility, they would
have to be certified. And there was some question about
whether they’d be able to do that, given the change in
the way Census Bureau was designating urban areas in the
elimination of urban clusters. There are more than this,
but there are some other CMS funding streams. One is the
Ambulance Fee Schedules that has a bonus payments for
ambulances that pick up a patient in a rural ZIP Code.



Telehealth payments used to be based on geography, that
was eliminated during the pandemic and it’s still not in
the… geographic requirements have not been reinstated
yet. There’s been a statutory suspension of the
geographic limits, but that has a time limit. So,
Congress may have to revisit it, but it used to be that
non-metro counties were completely eligible within
medical facilities to be an originating site for
telehealth consultations. And then, if you were in a
metro county, it had to be a census tract that FORHP
designated as rural, but that also had to be in a
shortage area. And then, there’s the Section 340B that
allows hospitals or participating healthcare
organizations to get discounts on pharmaceuticals. And
so, all of these are direct, as I mentioned, with the
Critical Access Hospitals, and that was 10 years ago, it
meant up to $2 billion a year.



So, it far exceeded the other kinds of funding streams
that, for example, OHP has available with our grant
programs for rural areas. So, if you want to learn more
about HRSA, you can go to the HRSA site, but also
hrsa.gov/rural-health will take you to the FORHP website
and you can learn more about the grant programs there.
And we have several grant programs that are open to
public or to healthcare organizations that are looking
for funding for new and creative projects. So, the Rural
Health Outreach grants are a terrific opportunity. And
the other opportunity I would say is to subscribe to
RHIhub and their alerts on their weekly newsletters and
their information about funding sources, because they’re
tremendously helpful.



And we are not implying that OHP or Department of Health
and Human Services are the only funding sources for rural
areas. Department of Transportation, but especially USDA
has some. And some of those can be used for rural health
projects. So, distance learning or community facility
loans or grants can be used for healthcare facilities.
So, you can also seek those out or ask our RHIhub for
help to identify those. And so, thanks to Greta and Sarah
Heppner. And now I think we can take questions if we have
time and there are any questions.



Kristine Sande: So, starting with the
first question that came through, do any of the panelists
have an idea of if and when the OMB will update the CBSAs
based on the new Census Bureau definition?



Steve Hirsch: Yes, they did it in July.
So, the list of new micropolitan and metropolitan areas
came out in July.



Kristine Sande: All right. And also, any
idea when the RUCAs will be updated? So, when the RUCAs
will be updated and when the commuting package will be
released.



Steve Hirsch: It’s looking like it will
be next year, and that USDA won’t be able to get the data
from Census until next year. And so, we are hopeful that
sometime in the fall next year we’ll be able to have new
RUCA codes. And the RUCA codes, by the way, for every
census tract in the United States.



Kristine Sande: All right. Can you speak
a bit about Medically Underserved Areas and how those
areas connect or correlate to rural areas?



Steve Hirsch: Well, Medically
Underserved Areas can be rural but are not necessarily
rural, but rural areas are far more likely to be
medically underserved or Health Professional Shortage
Areas than urban areas are. Now, there are Medically
Underserved Areas in urban areas, and there are Health
Professional Shortage Areas that are urban, but if you’re
in a rural area, it’s far more likely to not have a
sufficient provider base for healthcare.



Kristine Sande: So, another question
about when updated data will be available, when will the
2020 RUCC codes be published?



Steve Hirsch: I don’t know. We don’t
know. USDA will be updating that, so I am not sure.



Kristine Sande: Is there a resource or
Excel spreadsheet that lists the U.S. cities and states
that are considered rural?



Steve Hirsch: On the Census Bureau
website for metro areas, and they have pages devoted to
metro and micro areas, and then another page for urban
areas, you can download spreadsheets that include all the
urban areas from the urban page, or all the metro areas
and metro counties from the metro page. Anything that’s
not included on those are considered rural. Now, the
Census Bureau urban areas, it’s not as easy to tell
because they don’t follow the city lines the same way
that OMB’s designations. If it says a county is metro,
the whole county is metro.



But for example, the urbanized areas of New Bern, North
Carolina doesn’t follow the New Bern city limits, it
extends outside. And the same for Washington, DC or
Chicago. The Urbanized Area can spread much further
beyond the city limits and you can’t tell just from
looking at that. Census has a website called TIGERweb
where you can map the Urbanized Areas. And actually, you
can also use RHIhub’s Am I Rural? to discover if your
address or your area is considered rural or urban, based
on a bunch of different definitions that will give you
the FAR code, the RUCA code, and whether you’re urbanized
by the Census Bureau or part of a metro area.



Kristine Sande: Any idea when CMS might
release a final guidance for RHC rural location
requirements?



Steve Hirsch: I’m not aware of when they
will do that, but I was very encouraged by the way they
chose to deal with the change in Urban Areas and Urban
Clusters.



Kristine Sande: Yes, it was nice to get
that interim guidance, for sure. Is the ambulance rural
bonus that you mentioned, the schedule, is the ambulance
rural bonus fee schedule automatic or does a hospital
need to sign up for that?



Steve Hirsch: As far as I understand,
it’s automatic. If an ambulance company files for a
Medicare payment for a patient they picked up, they would
put in the ZIP Code location where they picked up the
patient. And my understanding is that it would be an
automatic increase in payment based on the ZIP code.
Somebody else may know different.



Kristine Sande: All right. One other
question. Is anyone looking at commuting codes in rural
definitions and the impact of teleworking from home?



Steve Hirsch: That is a great question
and it has greatly concerned me, I think, and other
people, is that the census took place in spring of 2020
during the height of the initial outbreak of the
pandemic. And so, lots of people were working from home
that didn’t usually work from home. And I do not know how
Census is handling that, or even how OMB decided to use
commuting data. So, I believe that they’re using a
running American Community Survey data on commuting so
that it didn’t just include what happened on the date of
the 2020 census when data was gathered then, but includes
a longer period of time. So, that may flatten out some of
the effect of the pandemic.



Kristine Sande: All right, thank you.
And it looks like there are a couple of questions about
Health Professional Shortage Areas and who to talk to
with questions about that or where to go for information
about HPSAs. Can you help with that question?



Steve Hirsch: Well, yeah. HPSAs are done
within the Health Resources and Services Administration
by the Shortage Designation Branch. But there are also
primary care offices in every state and they work with
HRSA and the Shortage Designation Branch to do the HPSA
scoring. And so, if you can, you can search for a primary
care office in your state and look for the phone number
for the primary care office in your state and begin by
talking to them. And yeah, I see Kathleen McElligott made
the same point, talk to your PCO, your primary care
office in your state if you’re concerned about losing a
HPSA designation and want to find out why that happened,
or anything else to do with HPSAs.



Kristine Sande: Thank you so much to our
speakers today for sharing some really great information.
And thanks to all of you for joining us today. The slides
used in today’s webinar are available on the website in
the webinars section. And in addition, a recording and a
transcript of the webinar will be made available on the
website, and we’ll also send those out to you by email so
that you can share that information with others or watch
again. And so, we thank you for joining us, and have a
great day.