Small Rural Hospital Improvement Grant Program


To support hospital activities related to patient quality improvement, attaining equipment and/or training to comply with ICD-10 standards, and payment bundling. Hospitals will utilize funds to: 1) pay for costs related to maintaining accurate prospective payment system billing and coding such as updating and or implementing ICD-10 hardware/software 2) pay for the costs related to delivery system changes as outlined in the ACA such as value-based purchasing (VBP), accountable care organizations (ACO), and payment bundling.

General information about this opportunity
Last Known Status
Program Number
Federal Agency/Office
Agency: Department of Health and Human Services
Office: Health Resources and Services Administration
Type(s) of Assistance Offered
Program Accomplishments
Not Applicable.
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.
Who is eligible to apply/benefit from this assistance?
Applicant Eligibility
The State Office of Rural Health (SORH) in each state will be the official grantee 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 Indian 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:

1) A “small hospital” 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 either located outside of a Metropolitan Statistical Area (MSA) or located within a rural census tract of a MSA, as determined under the Goldsmith Modification or the Rural Urban Commuting Areas (RUCAs), and,
3) Eligible SHIP hospitals may be for-profit or not-for-profit. 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.
In regards to hospitals determining their eligibility and to request a hospital application, hospitals should contact their SORH.
Applicants should review the individual HRSA funding opportunity announcement 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.
What is the process for applying and being award this assistance?
Pre-Application Procedure
Preapplication coordination is required. Environmental impact information is not required for this program. This program is excluded from coverage under E.O. 12372.
Application Procedure
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 Procedure
Notification is made in writing by a Notice of Award.
Contact the headquarters or regional office, as appropriate, for application deadlines.
Approval/Disapproval Decision 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.
How are proposals selected?
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.
How may assistance be used?
All funds awarded are to be expended solely for carrying out the approved projects.
What are the requirements after being awarded this opportunity?
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 funding opportunity announcement are subject to the reporting requirements of the Federal Funding Accountability and Transparency Act (FFATA) of 2006 (Pub. L. 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. Grantees 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.
Other 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: Grantee drawdown funds, as necessary, from the Payment Management System (PMS). PMS is the centralized web based payment system for HHS awards.
Who do I contact about this opportunity?
Regional or Local Office
See Regional Agency Offices. Bridget Ware, Federal Office of Rural Health Policy, Parklawn Building, 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
Website Address
Financial Information
Account Identification
(Project Grants) FY 14 $14,267,836; FY 15 est $14,199,267; and FY 16 est $14,375,985
Range and Average of Financial Assistance
$9,000 - $909,000. Average Award for FY14 $303,570.
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
Examples of Funded Projects
Not Applicable.


Federal Grants Resources