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Small Rural Hospital Improvement Grant Program

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Health Resources and Services Administration (HRSA), HHS.


Notice of availability of funds.


The Health Resources and Services Administration (HRSA) announces that applications are being accepted for grants to help small rural hospitals do any or all of the following: (1) Pay for costs related to the implementation of prospective payment systems (PPS), (2) comply with Start Printed Page 39578provisions of the Health Insurance Portability and Accountability Act (HIPAA) of 1996, and (3) reduce medical errors and support quality improvement.

Name of Grant Program: Small Rural Hospital Improvement Grant Program (SHIP). The OMB Catalog of Federal Domestic Assistance (CDFA) number is 93.301.

Program Authorization: Section 1820(g)(3) of the Social Security Act, 42 U.S.C. 1395: 4(g)(3).

Amount of Funding Available: Approximately $15.0 million is available for grants in fiscal year 2003.

Eligible Applicants: All small rural hospitals located in the fifty States and Territories, including faith-based hospitals. For the purpose of this program, (1) small is defined as 49 available beds or less, as reported on the hospital's most recently filed Medicare Cost Report, (2) rural is defined as located outside a Metropolitan Statistical Area (MSA); or located in a rural census tract of a MSA as determined under the Goldsmith Modification or the Rural Urban Commuting Areas, and (3) hospital is defined as a non-Federal, short-term, general acute care facility. There is no requirement for matching funds with this program.

Funding Criteria: To help facilitate the awards process, eligible hospitals that did not receive funds during fiscal year 2002 are asked to submit a brief letter of application to their State Office of Rural Health (SORH) that describes their need, and intended use and expenditure of grant funds. Hospitals that did receive funds during fiscal year 2002 should contact their SORH for application instructions if they wish to receive funds for fiscal year 2003. In turn, the SORH will prepare and submit a single grant application using Standard Form PHS 5161-1 (revised 7/00) (approved under OMB number 0920-0428) for applications to HRSA on behalf of all hospital applicants in their State. An award will be made to each State based on the total number of eligible applicants in that State. Grantee hospitals will receive their award from the SORH. Eligible hospitals in states that have chosen not to participate in this Federal-State partnership may submit a grant application (PHS Form 5161) directly to HRSA.

It is anticipated that all eligible hospitals (approximately 1,500) will apply for this grant program, which would result in awards of about $10,000 per hospital. It is expected that most of these grant funds will be used to purchase technical assistance, services, training and information technology. To help maximize purchasing power through economies of scale, eligible grantees are very strongly encouraged to organize themselves into consortiums and pool their grant funds for the purchase of these services. SORHs may help their eligible hospitals form consortiums and also purchase the goods and services they need.

Annual funding will be available for up to a three-year project period, with funding contingent upon: (a) Availability of Federal funds, and (b) satisfactory performance by the grantee. The SORH may charge up to five percent to the grants to cover its administrative costs.

Review Criteria: Applications will be evaluated on the extent to which they: (1) Are responsive to the requirements and purposes of this program, (2) describe need and strategies to address those needs, and (3) propose an allowable use of the grant funds. Further description of the review criteria is contained in the program guidance.

Requesting Applications: The application and program guidance for both the hospitals and SORHs may be downloaded via the web at​ship.htm. Hard copies of the application and program guidance are available from: HRSA Grants Application Center, Grants Management Officer, 901 Russell Avenue, Suite 450, Gaithersburg, MD 20879. Phone (877) 477-2123, E-mail To request an application please ask for announcement number HRSA-03-107.

Submitting Applications: All hospital applications must be submitted to the appropriate SORH in hard copy and postmarked before 5 PM EDT on June 27, 2003. All SORH applications must be submitted in hard copy and postmarked before 5 PM EDT on August 1, 2003 to the HRSA Grants Application Center, Grants Management Officer, 901 Russell Avenue, Suite 450, Gaithersburg, MD 20879. All applications from hospitals in States where the SORH has chosen not to participate must be submitted to the above address by 5 PM EDT on August 1, 2003. Applicants will receive a confirmation of receipt notice from the HRSA Grants Application Center.

Please note that HRSA anticipates accepting grant applications online in the last quarter of the Fiscal Year (July through September). Please refer to the HRSA grants schedule at​grants.htm for more information.

Program Contact Person: Jerry Coopey or Emily Costich, Office of Rural Health Policy, HRSA, Rm. 9A-55, Parklawn Bldg, 5600 Fishers Lane, Rockville, MD 20857. Phone (301) 443-0835, Fax (301) 443-2803, E-mail or

Paperwork Reduction Act: The application for this grant program has been approved by the Office of Management and Budget (OMB) under the Paperwork Reduction Act. The OMB clearance number is 0920-0428.

This program is not subject to the Public Health Systems Reporting Requirements.

Executive Order 12372: This program has been determined to be a program that is subject to the provisions of Executive Order 12372 concerning intergovernmental review of Federal Programs by appropriate health planning agencies, as implemented by 45 CFR part 100. Executive Order 12372 allows States the option of setting up a system for reviewing applications from within their States for assistance under certain Federal programs. The application packages to be made available under this notice will contain a listing of States that have chosen to set up such a review system and will provide a single point of contact (SPOC) in the States for review. (Please visit the following Web site:​omb/​grants/​spoc.html). Applicants (other than federally-recognized Indian tribal governments) should contact their State SPOC as early as possible to alert them to the prospective applications and receive any necessary instructions on the State process. For proposed projects serving more than one State, the applicant is advised to contact the SPOC of each affected State. The due date for State process recommendations is 60 days after the application deadline for new and competing awards. The granting agency does not guarantee to “accommodate or explain” State process recommendations it receives after that date. (See Executive Order 12372 and 45 CFR part 100 for a description of the review process and requirements.)

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Dated: June 4, 2003.

Elizabeth M. Duke,


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[FR Doc. 03-16620 Filed 7-1-03; 8:45 am]