WASHINGTON – Today, U.S. Sens. Mark R. Warner and Tim Kaine (both D-VA) introduced bipartisan legislation to ensure hospitals are fairly reimbursed for their services by the federal government and are able to remain open and functioning, especially in Virginia’s underserved and economically struggling regions. The budget-neutral Fair Medicare Hospital Payments Act of 2017 (S.397) would correct a flawed formula that results in disproportionately low Medicare reimbursement payments to hospitals in rural and low-wage areas. The Senators introduced the same legislation last year.

“Healthcare centers in rural areas already face unique challenges in providing care to underserved communities,” said Sen. Warner. “This is particularly true in Virginia, where some hospitals are the sole location in the area, and their closure would require patients to travel long distances to see a doctor. Our bipartisan legislation provides the funding Virginia’s rural hospitals need to continue providing lifesaving care.”

“Rural hospitals play a vital role in delivering care to Virginians but face too many threats to their long-term viability,” said Sen. Kaine. “By establishing a national minimum ‘area wage index’ for Medicare reimbursement, the bipartisan Fair Medicare Hospital Payments Act will remove one of these threats to the future of rural hospitals and will improve the delivery of care for rural communities in Virginia.”

The Fair Medicare Hospital Payments Act of 2017 would establish a national minimum “area wage index” of 0.874. The area wage index is based on the relative hospital wage level in the hospital’s geographic area compared to the national average. Over the past three decades, legislative and regulatory changes have combined with broader economic trends to create an uneven playing field that has resulted in hospitals losing out on millions of dollars in Medicare payments annually.

According to the Virginia Hospital and Healthcare Association, there are at least 19 hospitals in Virginia that currently have an index below 0.874 and would benefit from this change. This legislation has been endorsed by the Virginia Hospital Association and the National Rural Health Association.

List of Virginia hospitals:

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