Sponsors (3)
The bill raises Medicare OPD payments for Alaska and Hawaii to help sustain outpatient access in high‑cost, remote areas, but does so at increased federal cost and without guarantees that higher payments will improve quality or encourage efficiency.
Patients in remote and high‑cost communities in Alaska and Hawaii are more likely to keep local outpatient services and maintain access to care because providers will receive higher Medicare outpatient department (OPD) payments.
Hospitals and health systems in Alaska and Hawaii will receive higher OPD payments starting Jan 1, 2026 due to a cost‑of‑living adjustment to the non‑labor portion of payments.
Medicare payment increases for those states can be made without requiring budget‑neutral offsets, allowing direct funding increases rather than payment cuts elsewhere.
Federal taxpayers could face higher Medicare spending and larger deficits because OPD payment increases for Alaska and Hawaii are not budget‑neutral.
If the increased OPD payments are not tied to quality or access metrics, patients and communities may not see improved health outcomes despite higher spending.
Higher payments for hospitals in Alaska and Hawaii may reduce incentives to pursue payment reform or efficiency improvements in outpatient settings.
Based on analysis of 2 sections of legislative text.
Permits HHS to adjust the non‑labor portion of Medicare OPD payments for Alaska and Hawaii using cost‑of‑living‑style rules, effective Jan 1, 2026.
Permits the HHS Secretary to raise Medicare hospital outpatient department (OPD) payment amounts for services furnished in Alaska and Hawaii starting January 1, 2026, by applying a cost‑of‑living style adjustment to the non‑labor portion of OPD payments to reflect those states’ higher costs. The adjustment can be modeled on an existing cost‑of‑living rule and is explicitly not required to be budget neutral.
Official title: Amend title XVIII of the Social Security Act to provide for the application of a cost-of-living adjustment to the non-labor related portion for hospital outpatient department services furnished in Alaska and Hawaii.
Introduced February 12, 2025 by Daniel Scott Sullivan · Last progress February 12, 2025