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Public Statements

Statements on Introduced Bills and Joint Resolutions

Floor Speech

Location: Washington, DC

Mr. KOHL. Mr. President, I rise today to discuss the Health Care Capital Access Reauthorization Act. This legislation will allow Critical Access Hospitals, CAHs, to continue to access the Federal Housing Administration's, FHA, 242 program.

There are approximately 1,327 CAHs throughout the United States. These hospitals are vital to our health care system because they provide individuals who live in rural areas care they might not otherwise have. Many of these hospitals were built over 40 years ago and are in need of significant renovations. Without the exemption, many rural hospitals would not qualify for the low-cost loan insurance based on patients' average length of stay or because the hospital operates a nursing home, and as a result, many rural hospitals would face higher financing costs on construction and renovation loans.

Many CAHs provide a significant level of non-acute or long-term services, and therefore do not qualify for the FHA 242 program based on length of stay. Additionally, some CAHs operate nursing homes, further lengthening the average stay and causing the hospital to be ineligible for the 242 program. In 2006, Congress recognized the uniqueness and importance of these hospitals and passed the Rural Health Care Capital Access Act. This Act provided an exemption from the acute care provision in the FHA 242 program for Critical Access Facilities. The exemption expires on July 31.

After July 31, CAHs applying for financing will be unable to receive financing if the exemption is not extended. Since the initial exemption was passed in 2006, 10 rural hospitals in 10 states have received mortgage insurance through the program as a result of the exemption in Edgerton, Wis., Columbus, Mont., Springfield, Ga., Monticello, Ill., L'Anse, Mich., Cambridge, Neb., Hot Springs, S.D., Grand Coulee, Wash., Moab, Utah and Holyoke, Colo. The program has provided financing for these hospitals on loans ranging from $14 to $31 million and totaling more than $241 million.

The legislation I am introducing today would provide a five-year extension of the exemption in the Rural Health Care Capital Access Act, allowing the many rural hospitals that provide significant levels of non-acute or long-term care to continue applying for financing under a FHA 242 program. Without the exemption, these rural hospitals would not qualify for an FHA loan based on patients' average length of stay, resulting in fewer options for construction and renovation loans.

I would like to thank the original coponsors of this bill: Senators Conrad, Tim Johnson, Thune, Johanns, and Tester for their leadership and support for Critical Access Hospitals. I look forward to working with my colleagues on this important issue to move the Rural Health Care Capital Access Reauthorization Act towards passage.

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