(a) A hospital located in an urban area (Metropolitan Statistical Areas (MSA) county), can be considered rural for the purposes of a designation as a critical access hospital pursuant to 42 U.S.C. §1395i-4(c)(2) if it meets the following criteria:

(1) Is enrolled as both a Medicaid and Medicare provider and accepts assignment for all Medicaid and Medicare patients;

(2) Provides emergency health care services to indigent patients;

(3) Maintains 24-hour emergency services; and

(4) Is located in a county that has a rural population of 50 percent or greater as determined by the most recent United States decennial census.

(b) A critical access hospital designated pursuant to this section may apply to be designated as a community outpatient medical center if:

(1) It has been designated as a critical access hospital for at least one year; and

(2) It is designated as a critical access hospital at the time of application to convert to a community outpatient medical center.

(c) In addition to the requirements of subsection (b) of this section, a community outpatient medical center shall, at a minimum:

(1) Provide emergency medical care and observation care 24 hours a day, seven days a week;

(2) Treat all patients regardless of insurance status; and

(3) Have protocols in place for the timely transfer of patients who require a higher level of care.

(d) The Department of Health and Human Resources shall propose a new rule for legislative approval in accordance with the provisions of §29A-3-1 et seq. of this code, to implement the provisions of this section.