Fair Funding for Rural Hospitals Act
The Fair Funding for Rural Hospitals Act would modify federal Medicaid rules to guarantee a minimum Disproportionate Share Hospital (DSH) payment allotment to every state. DSH payments are federal funds intended to help hospitals that treat large numbers of low-income, uninsured, or Medicaid patients. The bill creates an annual floor for each state's DSH allotment starting in fiscal year 2025. Specifically, from 2025 through 2029, no state’s DSH allotment may be less than $20 million. Beginning in 2030, the floor would continue for each state but would rise with inflation, following an inflation-adjustment mechanism referenced in the bill. The floor applies notwithstanding existing DSH tables or any reductions that are otherwise required, meaning it acts as a baseline minimum that states must receive each year. In short, the bill aims to stabilize and increase funding for rural and other safety-net hospitals by ensuring a predictable minimum level of DSH support across all states, with inflation-based increases starting in 2030.
Key Points
- 1Establishes a floor for annual state DSH allotments starting in fiscal year 2025.
- 2Fixed minimums: $20,000,000 per state from 2025 through 2029.
- 3Inflation-adjusted floor from fiscal year 2030 onward (the adjustment is specified to be per a provision on inflation in the bill).
- 4The minimum is a floor “notwithstanding” the existing DSH table or reductions under other sections, ensuring it cannot be overridden by those provisions.
- 5The measure is codified by adding a new subparagraph to Section 1923(f)(6) of the Social Security Act, creating a nationwide minimum baseline for DSH funding.