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This bipartisan proposal seeks to permanently extend two key Medicare rural hospital programs and establish a new rebasing year – preventing closures that would disrupt access to care for individuals in rural communities.

The Rural Hospital Support Act would permanently extend the Medicare-dependent Hospital (MDH) and Low-Volume Hospital (LVH) designations, and it would establish a new rebasing year for Sole Community Hospitals (SCH) and MDHs based on 2016 data.

MDH designations help rural hospitals that otherwise would struggle to maintain financial stability under Medicare’s fee schedule due to their small size and large share of Medicare beneficiaries. There are currently 174 MDHs nationwide, three of which are in Iowa. LVH designations similarly offer a more feasible payment formula to hospitals that treat a low number of beneficiaries. The formula takes into consideration the fixed costs of treating fewer patients relative to the typical payment system that favors high beneficiary volume. There are currently 633 LVHs nationwide, six of which are in Iowa. SCH designations support rural hospitals where Medicare beneficiaries are unable to access another hospital within a reasonable distance and time. There are currently 464 SCHs nationwide, seven of which are in Iowa.

By helping hospitals keep their doors open, MDH and LVH designations are the safety net providers for rural Americans and are extremely important to rural economies. Without an extension, MDH and LVH will expire October 1, 2022.