What This Bill Does
This bill amends Medicare rules to change how hospitals outside frontier states get paid. The bill aims to ensure fairness in Medicare payments to rural hospitals by setting a minimum payment level based on area wage index calculations (a measure of labor costs in different regions).
Who It Affects
- Hospitals outside frontier states that receive Medicare payments
- Medicare patients receiving inpatient and outpatient services at these hospitals
- The Centers for Medicare and Medicaid Services (the federal agency that administers Medicare)
Key Provisions
- Hospitals not located in frontier states cannot receive inpatient payment adjustments (wage index adjustments) lower than 0.85 for discharges starting October 1, 2023. (Sec. 2(a)(1))
- Hospitals not located in frontier states cannot receive outpatient department payment adjustments (wage index adjustments) lower than 0.85 for services starting January 1, 2024. (Sec. 2(b))
- These payment floor provisions will not be applied in a budget neutral manner, meaning the federal government will not offset higher payments by reducing payments elsewhere. (Sec. 2(a)(1) and 2(b))
What Changes
If this law passes, rural hospitals outside frontier states will receive minimum payment levels (0.85 wage index floor) for both inpatient and outpatient services. Previously, these hospitals could receive lower payments based on their regional wage calculations. The government will not balance these higher payments by cutting other Medicare payments.
Important Definitions
- Area wage index: A number used to adjust Medicare payments based on how much it costs to pay workers in a particular geographic area
- Frontier State: Not specified in bill text
- Budget neutral: Offsetting increased spending in one area by reducing spending in another area
Effective Date
Inpatient services: October 1, 2023. Outpatient department services: January 1, 2024.
II
118TH CONGRESS
1ST SESSION
S. 803
To amend the title XVIII of the Social Security Act to preserve access
to rural health care by ensuring fairness in Medicare hospital payments.
IN THE SENATE OF THE UNITED STATES
MARCH 15, 2023
Mr. WARNER (for himself, Mrs. BLACKBURN, Mr. KAINE, Mr. CORNYN, Mr.
WARNOCK, Mr. BOOZMAN, Mrs. HYDE-SMITH, and Mr. WICKER) intro-
duced the following bill; which was read twice and referred to the Com-
mittee on Finance
A BILL
To amend the title XVIII of the Social Security Act to
preserve access to rural health care by ensuring fairness
in Medicare hospital payments.
Be it enacted by the Senate and House of Representa-
1
tives of the United States of America in Congress assembled,
2
SECTION 1. SHORT TITLE.
3
This Act may be cited as the ‘‘Save Rural Hospitals
4
Act of 2023’’.
5
SEC. 2. ENSURING FAIRNESS IN MEDICARE HOSPITAL PAY-
6
MENTS.
7
(a) HOSPITAL INPATIENT SERVICES.—
8
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•S 803 IS
(1) IN
GENERAL.—Section 1886(d)(3)(E) of
1
the
Social
Security
Act
(42
U.S.C.
2
1395ww(d)(3)(E)) is amended—
3
(A) in clause (i), in the first sentence, by
4
striking ‘‘or (iv)’’ and inserting ‘‘, (iv), or (v)’’;
5
and
6
(B) by adding at the end the following new
7
clause:
8
‘‘(v) AREA WAGE INDEX FLOOR.—
9
‘‘(I)
IN
GENERAL.—For
dis-
10
charges occurring on or after October
11
1, 2023, the area wage index applica-
12
ble under this subparagraph to any
13
hospital which is not located in a fron-
14
tier State (as defined in clause
15
(iii)(II)) may not be less than 0.85.
16
‘‘(II) WAIVING
BUDGET
NEU-
17
TRALITY.—Pursuant to the fifth sen-
18
tence of clause (i), this clause shall
19
not be applied in a budget neutral
20
manner.’’.
21
(2) WAIVING BUDGET NEUTRALITY.—
22
(A) TECHNICAL
AMENDATORY
CORREC-
23
TION.—Section 10324(a)(2) of Public Law
24
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•S 803 IS
111–148 is amended by striking ‘‘third sen-
1
tence’’ and inserting ‘‘fifth sentence’’.
2
(B) WAIVER.—Section 1886(d)(3)(E)(i) of
3
the
Social
Security
Act
(42
U.S.C.
4
1395ww(d)(3)(E)(i)) is amended, in the fifth
5
sentence—
6
(i) by striking ‘‘and the amendments’’
7
and inserting ‘‘, the amendments’’; and
8
(ii) by inserting ‘‘, and the amend-
9
ments made by section 2(a)(1) of the Save
10
Rural Hospitals Act of 2023’’ after ‘‘Act of
11
2021’’.
12
(b) HOSPITAL OUTPATIENT DEPARTMENT SERV-
13
ICES.—Section 1833(t) of the Social Security Act (42
14
U.S.C. 1395l(t)), is amended—
15
(1) in paragraph (2)(D), by striking ‘‘(19), the
16
Secretary’’ and inserting ‘‘(19) and paragraph (23),
17
the Secretary’’; and
18
(2) by adding at the end the following new
19
paragraph:
20
‘‘(23) FLOOR
ON
AREA
WAGE
ADJUSTMENT
21
FACTOR FOR HOSPITAL OUTPATIENT DEPARTMENT
22
SERVICES.—With respect to covered OPD services
23
furnished on or after January 1, 2024, the area
24
wage adjustment factor applicable under the pay-
25
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•S 803 IS
ment system established under this subsection to
1
any hospital outpatient department which is not lo-
2
cated in a frontier State (as defined in section
3
1886(d)(3)(E)(iii)(II)) may not be less than 0.85.
4
The preceding sentence shall not be implemented in
5
a budget neutral manner.’’.
6
Æ
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