Rural Hospital Protection Act
Due to the dire need for legislative action in order to protect CAHs from detrimental provider taxes, NRHA strongly supports passage of the Rural Hospital Protection Act and commends Reps. Graves and Kind for their work and leadership in this important area. Reps. Sam Graves (R-MO) and Ron Kind (D- WI) introduced the Rural Hospital Protection Act on Wednesday April 6. This legislation would ensure that critical access hospitals continue to be appropriately reimbursed for provider taxes. Prior to this year, hospitals could include certain taxes (provider taxes) paid to states relating to the “reasonable and necessary cost of providing patient care” and representing “costs actually incurred” when submitting Medicare cost reports to the Centers for Medicare and Medicaid Services (CMS). These taxes are levied upon hospitals in certain states to help fund Medicaid shares, and have long been considered a regular business operating cost for hospitals. In the federal regulations pertaining to the 2011 inpatient prospective payment system (IPPS) for acute and long-term care hospitals, CMS implemented a “clarification” that disallows such provider taxes to qualify on hospital Medicare cost reports. In the rule, CMS states that this change is related to its concern that these taxes do not represent the costs actually incurred on hospitals, and states that this will have “no financial impact” on Critical Access Hospitals (CAHs). NRHA believes this decision is more than a mere “clarification” and would have severe impact on hospitals, specifically CAHs.