Frontier Community Health Integration Project (FCHIP)

Supporting Care in Rural Areas

MHA provides technical assistance, site implementation assistance, and other tracking and analytic activities to support providers participating in the Frontier Community Health Integration Project (FCHIP) Demonstration in identifying potential new approaches to health care delivery, reimbursement, and coordination in sparsely populated areas. Frontier facilities from Montana, North Dakota and Nevada participate in the program.

FCHIP Hospitals
Establishing Eligibility
Final Solicitation
Launching the Demonstration


The introduction of the critical access hospital (CAH) provider type in 1997 intended to support essential care in rural area by changing the Medicare reimbursement model to reflect reasonable cost by replacing the inpatient and outpatient prospective payment system for qualifying facilities. However, due to significantly low patient volumes and not all services being applicable for Medicare cost-based reimbursement, rural facilities continued to struggle with financial solvency. The closure of rural, frontier facilities throughout the nation and the subsequent impact on underserved communities was recognized and addressed at the federal level.

The Medicare Improvement for Patients and Providers Act (MIPPA) was signed into law in July 2008, becoming effective January 2010. The language within MIPPA, specifically in section 123, authorized the Secretary of Health and Human Services to establish a demonstration project to develop and test new models for the delivery of health care services to Medicare beneficiaries in certain frontier counties. In accordance with MIPPA, the purpose of any new frontier health care service delivery model shall be to improve access and better integrate the delivery of frontier acute care, extended care and other essential health care services for beneficiaries.

Establishing Eligibility

MIPPA legislation specified that participation in the 3-year demonstration project would be limited to eligible entities located in four frontier states: Alaska, Montana, North Dakota and Wyoming.

Eligibility requirements for participating facilities included:

  • Must be an existing critical access hospital (CAH) located in a frontier-eligible state;
  • Must be located in a county with a population of six or fewer people per square mile;
  • Must have an average acute-care census of five patients or less; and
  • Must provide home health, hospice or physician services.

Of the 113 CAHs in the four states, only 71 met the MIPPA frontier eligibility criteria.

Developing a Frontier Health Delivery System

In response to the MIPPA legislation and subsequent funding by Congress, in August 2010, the Health Resources and Service Administration/Office of Rural Health Policy (HRSA/ORHP) awarded an 18-month cooperative agreement to the Montana Health Research and Education Foundation (MHREF) to assist in the development of a frontier health delivery system. As MHA/MHREF had been instrumental with writing the language for MIPPA legislation, the opportunity to follow the project to fruition was inherently significant.

In November 2012, MHREF, the Montana Office of Rural Health, and nine Montana frontier facility CEOs and their consultants, submitted a document to HRSA and CMS titled ‘Framework for a New Frontier Health System Model’, the effort of months of intensive collaborative work. The document provided an overview of the challenges facing frontier providers and communities and introduced a potential model for a new integrated ‘Frontier Health System’ that would assist in the development of a demonstration aiming to achieve the goals in the authorizing legislation. A demonstration of this proposed Frontier Health System model would potentially influence future policy while ensuring access to much needed health care services in frontier communities. The information within the ‘Framework’ formulated the design for the Frontier Community Health Integration Project (FCHIP).

In addition to this framework document, which provided a cursory look at the challenges and opportunities facing frontier communities, MHREF delivered six white papers providing more in-depth analysis, information, and data regarding specific frontier health care service delivery issues. These white paper topics included:

  • White Paper #1: Referral and Admission/Readmission Patterns
  • White Paper #2: Frontier Telehealth
  • White Paper #3: Frontier Quality Measures and Pay For Performance
  • White Paper #4: Frontier Long term Care Issues/Swing Bed Use
  • White Paper #5: Frontier Cost Report Issues
  • White Paper #6: Frontier Health Care Workforce

Final Solicitation

On January 31, 2014, CMS announced their plans and vision for FCHIP within the contents of the CMS Frontier Community Health Integration Project/Demonstration Design and Solicitation document. This document described the qualifications for applicants and the specific waiver opportunities along with the alternative reimbursement models intended for the project. The solicitation document also included an outline of changes to the criteria for waiver eligibility. CMS extended the eligible entity definition to include all CAHs receiving funding through the Rural Flexibility Program (FLEX), therefore increasing the potential number of participating facilities. Also, the state of Nevada was added to the list of states meeting the criteria for eligibility.

Thirteen frontier facilities from the states of Montana, North Dakota and Nevada submitted applications requesting participation with the FCHIP, which would allow reimbursement modification in four services areas:

  • Telehealth-allowing for cost based reimbursement to the CAH originating site, limited to staffing and overhead cost associated with providing telehealth services. In addition, the waiver would also allow for reimbursement when using asynchronous ‘store and forward’ technology
  • Home Health-Enhanced payment for travel, $1.054 per mile, up to a maximum of $1680 per episode
  • Swing Bed Expansion-Increasing the bed limit for CAHs from 25 to 35 and allowing for cost based reimbursement for staffing costs associated with the additional beds
  • Ambulance-Waiving the 35 mile rule for ambulance services for CAHs, allowing for cost based reimbursement for EMS staff

The final tally of waiver applications revealed that the 13 facilities had applied for the following waivers:

  • Telehealth: total of 10 facilities- Montana-3, North Dakota-3, Nevada-4
  • Ambulance: total of 5 facilities- Montana-1, North Dakota-4
  • Home Health: total of 1 facility- North Dakota
  • Bed Expansion: total of 3 facilities- Montana-2, North Dakota-1

In August 2014, MHREF received an award notification for the Frontier Community Health Integration Project Technical Assistance, Tracking and Analysis Program from HRSA, targeting a grant project period of September 1, 2014 through August 31, 2017. MHREF initiated the early phases of project implementation anticipating the imminent announcement of waiver awards. However, a year later, the timeline for the approval process remained unclear.

Launching the Demonstration

In January 2016, MHREF and other FCHIP team members launched an effort to move the demonstration forward. MHREF participated in weekly calls with HRSA and took part in ongoing collaboration with the CMS Implementation team, including the development of a set of metrics to monitor and measure project outcomes and success.

Finally, two years after the plan and vision for the FCHIP demonstration project was initially announced, MHREF and the 10 CAHs who were awarded participation, received notification from CMS of the official start date of August 1, 2016.

The 3-year demonstration will run from August 1, 2016 through July 31, 2019. Throughout this demonstration, MHREF will provide technical assistance and work alongside the CAHs to increase access to services, improve the quality of care, increase patient satisfaction, and reduce readmissions.

Participating Facilities


  • Dahl Memorial Healthcare Association, Inc.
    • Ekalaka, MT
    • CEO: Nadine Elmore
    • Waiver: Telehealth
  • McCone County Health Center
    • Circle, MT
    • CEO: Nancy Rosaaen
    • Waivers: Telehealth & Swing Bed Expansion
  • Roosevelt Medical Center
    • Culbertson, MT
    • Administrator: Audrey Stromberg
    • Waivers: Telehealth, Ambulance, & Swing Bed Expansion

North Dakota

  • Jacobson Memorial Hospital Care Center
    • Elgin, ND
    • CEO/Administrator: Theo Stoller
    • Waiver: Swing Bed Expansion
  • McKenzie County Healthcare Systems, Inc.
    • CEO: Daniel Kelly
    • Waiver: Telehealth
  • Southwest Healthcare Services
    • Bowman, ND
    • CEO: Becky Hansen
    • Waiver: Ambulance


  • Battle Mountain General Hospital
    • Battle Mountain, NV
    • CEO: Peggy Lindsey
    • Waiver: Telehealth
  • Grover C. Dils Medical Center
    • Caliente, NV
    • CEO/Administrator: Jason Bleak
    • Waiver: Telehealth
  • Mount Grant General Hospital
    • Hawthorne, NV
    • Administrator: Richard Munger
    • Waiver: Telehealth
  • Pershing General Hospital
    • Lovelock, NV
    • Administrator/CEO: Patricia Bianchi
    • Waiver: Telehealth

Quality Improvement

Quality Improvement
Frontier Community Health Integration Project Demonstration (FCHIP)
HealthCARE Montana – TAACCCT Grant
Hospital Engagement Network
Hospital Preparedness
Montana Area Health Education Centers (AHEC)
Rural Hospital Flexibility Program (FLEX)