Sponsors (6)
The bill redistributes Medicare IPPS payments to boost wage-index funding for hospitals in low-wage areas—supporting local hospital finances and patient access—while requiring offsets that reduce payments elsewhere and adding administrative and taxpayer burdens.
Hospitals located in low-wage areas will receive higher Medicare IPPS wage-index payments (the wage index will be raised by half the gap for hospitals below the 25th percentile), increasing revenue for those hospitals.
Patients served by hospitals in low-wage areas (including those with chronic conditions) are more likely to retain local inpatient care if the increased Medicare payments improve those hospitals' financial stability.
Other hospitals or Medicare IPPS adjustments may receive reduced payments to keep the policy budget-neutral, which could lower revenue for some hospitals and shift costs within the hospital payment system.
Taxpayers and HHS may face indirect costs and administrative complexity from implementing the retroactive adjustment to 2019, increasing government administrative burden and potential implementation costs.
Based on analysis of 2 sections of legislative text.
Adds a budget‑neutral Medicare wage index boost for hospitals below the 25th percentile, raising their index halfway toward the 25th percentile for discharges on/after Oct 1, 2019.
Introduced March 26, 2026 by Mark R. Warner · Last progress March 26, 2026
Creates a new, budget‑neutral Medicare inpatient hospital wage index adjustment that raises the final area wage index for hospitals located in low‑wage areas. For discharges on or after October 1, 2019, hospitals whose area wage index (calculated without this new rule) is below the 25th percentile would receive an increase equal to half the difference between their otherwise‑applicable final wage index and the 25th percentile for that fiscal year. The change must be applied budget‑neutrally under existing law, so the increase is offset by reductions elsewhere in the wage index calculations.