News
Sheridan Memorial Hospital Might Transition To A Critical Access Hospital
As Sheridan Memorial Hospital works to continue strengthening local healthcare, it has begun exploring a transition to a critical access designation as part of its long-term strategy for supporting its mission of providing excellent, patient-centered care.
Over the past decade, SMH has experienced significant changes, including increased demand for behavioral health services, a growing senior population and the need for expanded access to specialty care.
Following a review of patient volumes and community needs, hospital leadership has begun exploring a transition from a prospective payment system (PPS) hospital to a critical
access hospital (CAH).
Over the years, SMH has seen a dramatic change in how it is reimbursed for providing care to the community.
The hospital system receives payment from commercial insurance companies as well as fixed payers such as Medicare, Medicaid and Veterans Affairs.
In 2005, fixed payers represented 40% of the payer mix.
Today, fixed payers make up 67% of SMH’s payer mix.
The challenge with such a substantial percentage of fixed payers is that the payments from these sources do not cover the cost of providing care.
Medicare reimbursements, for example, have covered approximately 75% of SMH’s cost to provide care.
The change to a CAH would align with SMH’s ongoing commitment to provide high-quality, patient-centered care while ensuring long-term sustainability as a rural healthcare provider.
Critical access designation would support more stable reimbursement for the cost of care, allowing the hospital to continue reinvesting in its people, facilities and technology.
“Importantly, all current services at SMH would continue if Sheridan Memorial Hospital were to become a critical access hospital,” healthcare system CEO Mike McCafferty said. “The hospital would maintain its full scope of care and continue adapting to meet the needs of the community.”
SMH leadership is working closely with clinical teams and staff to evaluate opportunities and ensure any changes are implemented thoughtfully, with a continued focus on patient experience and quality care.
“As a community hospital, our responsibility is to ensure we are positioned to serve Sheridan and the surrounding region for years to come,” McCafferty said. “These efforts are about
strengthening that foundation.”
Ezra Petersen
March 26, 2026 at 5:14 am
A critical access hospital is capped at 25 inpatient beds. There is also a cap on length of stay at 96 hours average. All the remodeling they did for the transitional care and behavioral health unit will probably go to waste. This place has been ran into the ground by the current management. These statments by Mccafferty about the current level of care staying the same are lies.
Penny J. Goodman
March 26, 2026 at 10:00 am
Your article headline says MIGHT transition. It’s already in the works.
Dont get sick in Sheridan.
Dawn Sopron
March 26, 2026 at 9:35 pm
This is confusing as CAH facilities can only have up to 25 beds, with variance of up to 10 additional psychiatric beds. SMH is much larger, so how would this work?
Janice Gosch
March 28, 2026 at 2:04 pm
Yep and what about the employees..last I checked they had 880 employees. Wonder when there will be layoffs.
Barb Johnson
March 27, 2026 at 12:06 pm
What a crock!!!! SMH is a fairly large, functioning hospital as it is and has been for many years AS WELL AS CONTINUING TO BUILD ‘SPECIALTY CARE FACILITIES’ ALL OVER SHERIDAN. Not ever happy, it seems: as SMH continues to take over Surgical Center, Neurology and any other medical facility in Sheridan. Appears that no matter how large SMH and how costly their care is to individuals, they want to combine a deal with Billings for additional healthcare, but WAIT: they plan on minimizing ALL health care needs to Sheridan’s population now EVEN THOUGH THE CITY IS BURSTING AT THE SURROUNDING SEAMS WITH NEW HOUSING SECTIONS!!! What the heck!!! Am I missing something???? I simply do not even understand!!! Does the Sheridan people have a say??!!?? Are they playing us for stupid?
Frank Grant
March 28, 2026 at 10:10 am
All roses and sunshine, but the article doesn’t explain how shifting to a Critical Care facility will increase the reimbursement level to the hospital. Looks like the real plan is to go to short-term care and then ship patients to Billings.
Janice Gosch
March 29, 2026 at 4:07 pm
I have been having to go to IMH in Billings for 3 years now as there is no specialist here to deal with the medical issue I have. I keep thinking that after the great care I have received there it may be that I move there. What will happen with this Transition at SMH is if you go here and need to be hospitalized you will be stabilized here then shipped to Billings Clinic for continued care. Might as well live there. Too bad this place is not more concerned about quality vs quantity and $$$$$