Rural Hospital Support Act
The Rural Hospital Support Act would change how Medicare pays certain rural hospitals. It adds a new “rebased target amount” for Sole Community Hospitals (SCH) and Medicare-Dependent Hospitals (MDH) that would, if it increases payments, replace the current payment amount for cost reporting periods beginning after October 1, 2025. The rebasing uses the 12-month cost reporting period starting in fiscal year 2016 as the new base and applies only to periods where it increases payment. The bill also extends the MDH payment methodology and the Medicare Low-Volume Hospital (LVH) program, and it limits adjustments to the rebased payment amounts. Additionally, hospitals would have the option to decline reclassification. In short, it aims to modernize and extend support for rural hospitals by redefining payment baselines, extending existing programs, and limiting how those rebased figures can be adjusted.
Key Points
- 1New rebased target amounts for SCHs (Section 2) and MDHs (Section 3)
- 2- For cost reporting periods beginning after October 1, 2025, a “M rebased target amount” (for SCHs) and an “N rebased target amount” (for MDHs) can replace the current target amount if they yield higher payments.
- 3- The rebased amounts use the 12-month cost reporting period beginning in fiscal year 2016 as the base, and references to “first cost reporting period” are aligned with October 1, 2025 onward.
- 4- Substitutions apply only if they increase payments; otherwise, the existing framework remains.
- 5Conforming amendments to include new rebased targets (Section 2)
- 6Prohibition on adjusting rebased payments with prior adjustments (Section 4)
- 7- For discharges paid under the rebased target amounts (M or N), the Secretary may not apply certain pre-2015 adjustments to these rebased amounts.
- 8Extension of the MDH program and hospital reclassification options (Section 5)
- 9- Extends the MDH payment methodology beyond the previous endpoint (removing the April 1, 2025 cutoff).
- 10- Extends the MDH target amount framework to include a broader set of fiscal years (“or a subsequent fiscal year”).
- 11- Allows hospitals to decline reclassification if they choose.
- 12Extension of the Medicare LVH program (Section 6)
- 13- Keeps increased LVH payments in place for fiscal years beyond the prior expiration.
- 14- Broadens the applicable years to include 2011 onward and continues annual increases.