Show-Me State Times

U.S. Senator Josh Hawley (R-Mo.) has introduced new legislation aimed at increasing federal investment in rural hospitals and preventing future cuts to Medicaid hospital funding. The proposed bill, called the Protect Medicaid and Rural Hospitals Act, seeks to build on measures Hawley previously secured for rural hospitals through the recently enacted reconciliation bill.

The reconciliation bill established a rural hospital fund for the first time, but it also scheduled reductions in states’ provider tax authority beginning as early as 2028. Provider taxes are used by states to help finance their Medicaid programs and access federal funds that support critical-access hospitals and other rural providers.

“President Trump has always said we have to protect Medicaid for working people. Now is the time to prevent any future cuts to Medicaid from going into effect,” Senator Hawley said. “We should also increase our support for rural hospitals around the country. Under the recent reconciliation bill, Missouri will see an extra $1 billion for hospitals over the next four years. I want to see Medicaid reductions stopped and rural hospitals fully funded permanently.”

The new legislation would repeal both the provider tax moratorium and planned reductions of provider tax authority included in the reconciliation bill, restoring a key aspect of state-level Medicaid financing. It would also remove provisions related to state directed payments that could reduce reimbursements under Medicaid.

In addition, Hawley’s proposal calls for doubling total investment in the Rural Health Transformation Fund from $50 billion to $100 billion and extending its duration from five years to ten years.

A full text of the bill is available online.