CAH Designation Waiver Authority Act of 2011 - Amends title XVIII (Medicare) of the Social Security Act with respect to the Medicare rural hospital flexibility program and the "35-mile requirement" for designation of a critical access hospital (CAH) that a facility be located in a rural area more than 35 miles (or 15 miles in mountainous terrain or where only secondary roads are available) from another CAH.
(A CAH is a hospital certified to receive cost-based reimbursement from Medicare.)
Prohibits a state from designating a facility as a CAH unless: (1) it was assigned a Medicare provider number as an acute inpatient hospital before enactment of this Act, and (2) the Secretary of Health and Human Services (HHS) determines that such designation would not result in the total number of facilities so designated in all states on or after enactment of this Act being greater than 10% of the total number of acute inpatient hospitals designated as CAHs in all states as of March 31, 2011.