Small Rural Hospital Improvement Grant Program

To support small rural hospitals in their quality improvement efforts and with adapting to changing payment systems through investments in hardware, software, and related trainings.

This includes focusing on delivering value in care as well as activities related to improving Prospective Payment
Systems (PPS).

Agency - Department of Health and Human Services

The Department of Health and Human Services is the Federal government's principal agency for protecting the health of all Americans and providing essential human services, especially to those who are least able to help themselves.

Office - See Regional Agency Offices.

Bridget Ware, Federal Office of Rural Health Policy, Room 17W53B, 5600 Fishers Lane, Rockville, MD, 20857, 301-443-3822.
Website Address

Selected Recipients for this Program

RecipientAmount Start DateEnd Date
University Of Wisconsin System $ 2,264,790   2002-09-012025-05-31
Health And Human Services, Maine Department Of $ 508,733   2002-09-012024-05-31
Health Research, Inc. $ 708,276   2002-09-012023-05-31
Health And Human Services, Nebraska Department Of $ 2,339,503   2002-09-012023-05-31
Colorado Rural Health Center $ 1,316,052   2002-09-012023-05-31
University Of Kentucky $ 1,394,037   2002-09-012023-05-31
Public Health, Illinois Department Of $ 2,094,634   2002-09-012023-05-31
Health Care Services, California Department Of $ 1,420,007   2011-09-032023-05-31
Health And Environment, Kansas Department Of $ 3,283,194   2002-09-012023-05-31
Michigan Center For Rural Health $ 1,928,565   2017-07-012023-05-31

Program Accomplishments

Not Applicable.

Uses and Use Restrictions

All funds awarded are to be expended solely for carrying out the approved projects.

Eligibility Requirements

Applicant Eligibility

The State Office of Rural Health (SORH) in each state will be the official awardee of record, as they will act as a fiscal intermediary for all hospitals within their state.

Each SORH will be charged with organizing the distribution of funds to eligible hospitals.

Only SORHs are eligible to apply for this grant.

Federally-recognized Tribal Government and Native American Organizations are selected if they are eligible to apply.

Beneficiary Eligibility

Small rural hospitals must meet the following eligibility requirements in order to be eligible for SHIP funds: ?Small? is a facility with 49 or fewer available beds, as reported on the hospital?s most recent Medicare Cost Report. ?Rural area? is either (a) being located outside of a Metropolitan Statistical Area (MSA); (b) being located within a rural census tract of a MSA, as determined under the Goldsmith Modification or the Rural Urban Commuting Areas; or (c) being treated as if it is located in a rural area pursuant to 42 U.S.C. 1395(d)(8)(E). ?Hospital? is a non-federal, short-term, general acute care facility. Hospitals may be for-profit or not-for-profit. All Critical Access Hospitals are eligible for the program. In addition, hospitals with fewer than 50 beds located in a designated rural area, designated by any state law or regulation, are eligible. Tribally operated hospitals under Titles I and V of P.L. 93-638 are eligible to the extent that such hospitals meet the above criteria.


Applicants should review the individual HRSA notice of funding opportunity issued under this CFDA program for any required proof or certifications which must be submitted prior to or simultaneous with submission of an application package. This program is excluded from coverage under 2 CFR 200, Subpart E - Cost Principles.

Aplication and Award Process

Preapplication Coordination

Preapplication coordination is required.

Environmental impact information is not required for this program.

This program is excluded from coverage under E.O.


Application Procedures

This program is excluded from coverage under 2 CFR 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards. HRSA requires all applicants to apply electronically through All qualified applications will be forwarded to an objective review committee. Based on the advice of the objective review committee, the HRSA program official with delegated authority is responsible for final selection and funding decisions.

Award Procedures

Notification is made in writing by a Notice of Award.


Contact the headquarters or regional office, as appropriate, for application deadlines.


Section 1820(g)(3)(F)(ii)(I) of Social Security Act (42 U.S.C. 1395i-4 (g) (3), as amended by Section 3129 of the Patient Protection and Affordable Care Act (PPACA), P.L. 111-148.

Range of Approval/Disapproval Time

Up to six months.


Not Applicable.


SHIP awards may be made for up to 3-year project periods. Subject to availability of funds, after initial awards, projects may be renewed non-competitively contingent upon submission and approval of an application, availability of appropriated funds, and awardee's satisfactory performance.

Assistance Considerations

Formula and Matching Requirements

Statutory formulas are not applicable to this program. This program has no matching requirements. This program does not have MOE requirements.

Length and Time Phasing of Assistance

Awards are made annually and payment is made through the DHHS Payment Management System. See the following for information on how assistance is awarded/released: Awardee drawdown funds, as necessary, from the Payment Management System (PMS). PMS is the centralized web based payment system for HHS awards.

Post Assistance Requirements


Program reports are not applicable.

Cash reports are not applicable.

The awardee will be required to submit performance and progress reports as well as status-federal financial reports (see the program announcement and notice of award for details for each required report).

The awardee must submit a quarterly electronic Federal Financial Report (FFR) Cash Transaction Report via the Payment Management System within 30 days of the end of each calendar quarter.

A Federal Financial Report (SF-425) according to the following schedule:

A final report is due within 90 days after the project period ends.

If applicable, the awardee must submit a Tangible Personal Property Report (SF-428) and any related forms within 90 days after the project period ends.

New awards (?Type 1?) issued under this notice of funding opportunity are subject to the reporting requirements of the Federal Funding Accountability and Transparency Act (FFATA) of 2006 (Pub.


109?282), as amended by section 6202 of Public Law 110?252, and implemented by 2 CFR Part 170.

Grant and cooperative agreement recipients must report information for each first-tier subaward of $25,000 or more in federal funds and executive total compensation for the recipient?s and subrecipient?s five most highly compensated executives as outlined in Appendix A to 2 CFR Part 170 (FFATA details are available online at

Competing continuation awardees, etc.

may be subject to this requirement and will be so notified in the Notice of Award.

No expenditure reports are required.

Performance monitoring is not applicable.


In accordance with the provisions of 2 CFR 200, Subpart F - Audit Requirements, non-Federal entities that expend financial assistance of $750,000 or more in Federal awards will have a single or a program-specific audit conducted for that year. Non-Federal entities that expend less than $750,000 a year in Federal awards are exempt from Federal audit requirements for that year, except as noted in 2 CFR 200.503.


An electronic quarterly Federal Financial Report (FFR) is due to the Division of Payment Management within 30 days of the end of each quarter. A final FFR must be submitted to HRSA via the Electronic HandBooks (EHB) within 90 days of the end of each budget period. Awardees are required to maintain grant accounting records 3 years after the date they submit the Federal Financial Report (FFR). If any litigation, claim, negotiation, audit or other action involving the award has been started before the expiration of the 3-year period, the records shall be retained until completion of the action and resolution of all issues which arise from it, or until the end of the regular 3-year period, whichever is later.

Financial Information

Account Identification



(Project Grants) FY 16 $14,757,796; FY 17 est $15,288,642; and FY 18 Estimate Not Available

Range and Average of Financial Assistance

Range = $320,000 to $340,000. $332,361 (average award amount).

Regulations, Guidelines, and Literature

This program is subject to the provisions of 45 CFR Part 92 for State, local and tribal governments and 45 CFR Part 74 for institutions of higher education, hospitals, other nonprofit organizations and commercial organizations, as applicable. HRSA awards are subject to the requirements of the HHS Grants Policy Statement (HHS GPS) that are applicable based on recipient type and purpose of award. The HHS GPS is available at

Information Contacts

Regional or Local Office

See Regional Agency Offices. Bridget Ware, Federal Office of Rural Health Policy, Room 17W53B, 5600 Fishers Lane, Rockville, MD, 20857, 301-443-3822.

Headquarters Office

Federal Office of Rural Health Policy 5600 Fishers Lane, Room 17W53-C, Rockville, Maryland 20857 Phone: (301) 443-0835

Criteria for Selecting Proposals

Applicants will be evaluated based on: (1) extent to which applicant is responsive to the requirements and purposes of this program; and (2) extent to which application describes need, strategies and investment to address those needs.

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