Sponsors (6)
The bill strengthens payment, coverage, and technical support to preserve rural hospital financial stability and local access to care, but does so at meaningful federal cost and through budget‑neutral adjustments and caps that will redistribute payments and may leave some communities or providers worse off or create risks to appropriate inpatient use.
Rural hospitals, clinics, and ambulance providers will receive higher and more stable Medicare payments and targeted payment protections (sequestration exemption, increased bad-debt reimbursement, low-wage adjustment and floor, ambulance payment extension, rebasing/target adjustments), improving financial stability for rural health systems.
Medicare beneficiaries and rural residents will retain or gain local access to emergency, inpatient, extended care, ambulance, and telehealth services (CAH pathway, removal of the 96‑hour cap, extended-care reimbursement, ambulance payment continuation, telehealth payment clarifications), preserving needed local care.
State Offices of Rural Health and rural providers will get grants, technical assistance, training, and funding for conversions, technology upgrades, and behavioral health integration, strengthening local capacity and program design.
Taxpayers and the federal budget face higher Medicare spending because exemptions from sequestration, expanded coverage/longer inpatient stays, equalized copays, and new grant programs increase federal outlays and could raise deficits or require offsets.
Hospitals in higher‑wage or urban areas and some providers generally may see reduced Medicare payments due to budget‑neutral offsets (the low‑wage floor and related indexing/rebasing), creating winners and losers across hospitals and regions.
Some struggling rural hospitals and communities may be excluded from program benefits because the CAH state‑certification pathway has hard caps (national and per‑state) and some grants require local/state matching or payer support, disadvantaging areas with fewer resources.
Based on analysis of 8 sections of legislative text.
Exempts many rural-hospital Medicare payments from sequestration, raises rural bad-debt reimbursement, extends rural payment rules, relaxes CAH rules, and funds rural transformation grants.
Introduced June 3, 2025 by Samuel Graves · Last progress June 3, 2025
Exempts Medicare payments to many rural hospitals from automatic sequestration and raises the share of bad-debt costs reimbursed for rural hospitals, while extending and making permanent several special Medicare payment rules for low-volume, Medicare-dependent, and sole community rural hospitals. It eases several Critical Access Hospital (CAH) rules (including removing a physician-certification and inpatient length-of-stay cap), equalizes beneficiary copayments for CAH services, requires Medicare coverage for certain extended-care services furnished by section 1883 hospitals, and creates expanded grant and technical-assistance programs (including new five-year Rural Health Transformation Grants) administered through State Offices of Rural Health to support rural delivery-system transitions and conversions. The bill mainly affects rural hospitals, Medicare beneficiaries who use rural hospital services, and State Offices of Rural Health; it increases federal payments and creates new grant programs while directing HHS to implement coverage and program changes and to set application and distribution details by regulation or guidance. Many provisions take effect about 60 days after enactment; some payment changes apply to cost-reporting periods or fiscal years beginning more than 60 days after enactment.