Yes, this is bad for mid-majors.
As pointed out, mid-majors have one shot to run a fast 10k/5k/whatever.
If you are from the south (TX, Louisiana, etc.) you have very few opportunities to run a fast 5k/10k because the weather sucks most of the time. Don't believe me? Go on TFRRS and look up the fastest 5k's run in the south.
A few years ago University of Texas tried to do it at Texas Relays. They had individuals liek Lutz and Dohner who were top 10 in the country types, they barely pulled off a regional Q. While others who were top 50 in the NCAA in XC, couldn't get a regional standard.
It also hurts those who are in the far northeast who have snow and can't afford to travel.
So if you have a sub 14 kid in TX, and can only compete at Stanford once, you have to run a low 14 minute 5k, by yourself in TX heat and humidity just to get into Stanford to give yourself a shot to qualify.
It's even worse indoors. What if you can only go to a banked or oversized track once? So you expect some sub 14 5k guy to run a 14:10 on a flat 200m track by himself just to run fast enough to get into Washington?
The rule needs to be expanded to allow indoor meets to count for outdoors, and for times from the previous year to be used all year.