Magnolia hospital receives first CON exemption under new Small Community Hospital Pilot Program

• Beacham Memorial Hospital can now convert to acute care site, State Health Officer tells Mississippi State Board of Health.

The first certificate of need exemption under the newly created Small Community Hospital Pilot Program has been granted to a hospital in the City of Magnolia. 

The CON exemption for Beacham Hospital will allow the facility to convert into an acute care site, State Health Officer Dr. Daniel Edney told the Mississippi State Board of Health on Wednesday.

Before the establishment of the Small Community Hospital Pilot Program, as part of the passage of HB 1622 during the 2026 legislative session, Dr. Edney said making that change would have required the full certificate of need process.

Under the new law, each small community hospital has the ability to request one exemption. However, hospitals within the Delta Public Health Region will be allowed two exemptions.

State Senator Hob Bryan (D) told the Senate in March that about 55 hospitals could qualify for CON exemptions under the measure.

“Some of the most interesting conversations I’ve had have been with rural hospitals outside of the Delta trying to decide which exemption they want to ask for,” Edney told the Board.

Applications for exemptions under the pilot program are being accepted until June 30, 2027. 

“But I’m hoping we’ll be able to demonstrate to legislative leadership that the pilot is successful,” Edney said.

The law also allows a total of eight exemptions for the establishment of outpatient dialysis units in community hospitals statewide.

Dr. Edney added that the measure allows for two exemptions within each of the state’s four public health regions. No applications for that exemption had been sent to MSDH as of last week, but Edney said interest in the program is high. Exemptions to provide that service will not be granted on a first come first serve basis; rather, priority consideration will be given to facilities located furthest away from existing dialysis units.

“We’re going to wait 45 days before issuing the first one,” Edney explained. “We want to give all the hospitals an opportunity to file.”

As part of implementation of the Rural Health Transformation Program, a contract has been awarded to develop a statewide health assessment. Dr. Edney informed the Board that the contract will not only help the RHTP work, but provides the department with assistance as it reinvents the state health program. 

Three major projects have been outlined in Governor Tate Reeves’ office for the RHTP. The first is focused on infrastructure. BRIDGE (Building Rural Infrastructure for Delivery Growth and Efficiency) allows hospitals in rural areas to apply for capital expense funding to improve facilities and expand or start new programs. The second concerns modernizing and strengthening the health system’s IT infrastructure and cybersecurity, while the third aims to build out telehealth access.

“There’s a lot of interest from our smaller rural hospitals,” Edney noted. “This is an opportunity for those hospitals to get funding to build those programs out.”

Applications for a part of the $80 million available for those projects close on Wednesday, July 15, with awards set to be announced on August 15.