I 
115TH CONGRESS 
1ST SESSION H. R. 1130 
To amend title XVIII of the Social Security Act to ensure fairness in Medicare 
hospital payments by establishing a floor for the area wage index applied 
with respect to certain hospitals. 
IN THE HOUSE OF REPRESENTATIVES 
FEBRUARY 16, 2017 
Mrs. BLACK (for herself, Ms. SEWELL of Alabama, Mrs. BLACKBURN, Mr. 
ROE of Tennessee, Mr. BYRNE, Mr. COHEN, Mrs. ROBY, Mr. ROGERS of 
Alabama, Mr. BROOKS of Alabama, Mr. DUNCAN of Tennessee, Mr. COO-
PER, Mr. DESJARLAIS, Mr. FLEISCHMANN, Mr. KUSTOFF of Tennessee, 
and Mr. ADERHOLT) introduced the following bill; which was referred to 
the Committee on Ways and Means, and in addition to the Committee 
on Energy and Commerce, for a period to be subsequently determined by 
the Speaker, in each case for consideration of such provisions as fall with-
in the jurisdiction of the committee concerned 
A BILL 
To amend title XVIII of the Social Security Act to ensure 
fairness in Medicare hospital payments by establishing 
a floor for the area wage index applied with respect 
to certain hospitals. 
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. SHORT TITLE. 
This Act may be cited as the ‘‘Fair Medicare Hospital 
Payments Act of 2017’’. 
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SEC. 2. ENSURING FAIRNESS IN MEDICARE HOSPITAL PAY-
MENTS IN A BUDGET NEUTRAL MANNER. 
(a) 
HOSPITAL
INPATIENT
SERVICES.—Section 
1886(d)(3)(E) of the Social Security Act (42 U.S.C. 
1395www(d)(3)(E)) is amended— 
(1) in clause (i), by striking ‘‘clause (ii) or (iii)’’ 
and inserting ‘‘clause (ii), (iii), or (iv)’’; and 
(2) by adding at the end the following new 
clause: 
‘‘(iv) FLOOR ON AREA WAGE INDEX FOR HOS-
PITALS IN CERTAIN OTHER AREAS.— 
‘‘(I) IN GENERAL.—For discharges occur-
ring on or after October 1, 2017, the area wage 
index applicable under this subparagraph to 
any hospital which is not located in a frontier 
State (as defined in clause (iii)(II)) may not be 
less than 0.874. 
‘‘(II) ENSURING BUDGET NEUTRALITY.— 
In order to ensure that the aggregate payments 
made under this subsection for a fiscal year 
(beginning with fiscal year 2018) are not great-
er than the aggregate payments that would 
have been made under this subsection for such 
fiscal year without the application of subclause 
(I), as estimated by the Secretary, the Sec-
retary shall establish pursuant to rulemaking a 
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maximum area wage index to apply under this 
subparagraph to any hospital which is not lo-
cated in a frontier State (as defined in clause 
(iii)(II)). 
‘‘(III) NO IMPACT FOR HOSPITALS WITH 
AN AREA WAGE INDEX BETWEEN THE FLOOR 
AND
THE
MAXIMUM
INDEX.—Subclauses (I) 
and (II) shall have no effect on the area wage 
index applicable in a fiscal year to a hospital 
with an area wage index that is greater than 
the floor under subclause (I) but less than the 
maximum area wage index established under 
subclause (II) for the fiscal year.’’. 
(b) HOSPITAL OUTPATIENT DEPARTMENT SERV-
ICES.—Section 1833(t) of the Social Security Act (42 
U.S.C. 1395l(t)), is amended— 
(1) in paragraph (2)(D), by striking ‘‘para-
graph (19), the Secretary’’ and inserting ‘‘para-
graphs (19) and (22), the Secretary’’; and 
(2) by adding at the end the following new 
paragraph: 
‘‘(22) FLOOR
ON
AREA
WAGE
ADJUSTMENT 
FACTOR FOR HOSPITAL OUTPATIENT DEPARTMENT 
SERVICES
IN
AREAS
OTHER
THAN
IN
FRONTIER 
STATES.— 
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‘‘(A) IN GENERAL.—With respect to cov-
ered OPD services furnished on or after Janu-
ary 1, 2018, the area wage adjustment factor 
applicable under the payment system estab-
lished under this subsection to any hospital out-
patient department which is not located in a 
frontier 
State 
(as 
defined 
in 
section 
1886(d)(3)(E)(iii)(II)) may not be less than 
0.874. 
‘‘(B) ENSURING BUDGET NEUTRALITY.— 
In order to ensure that the aggregate payments 
made under this subsection for a year (begin-
ning with 2018) are not greater than the aggre-
gate payments that would have been made 
under this subsection for such year without the 
application of subparagraph (A), as estimated 
by the Secretary, the Secretary shall establish 
pursuant to rulemaking a maximum area wage 
adjustment factor to apply under the payment 
system established under this subsection to any 
hospital outpatient department which is not lo-
cated in a frontier State (as defined in clause 
(iii)(II)). 
‘‘(C) NO IMPACT FOR HOSPITALS WITH AN 
AREA
WAGE
ADJUSTMENT
FACTOR
BETWEEN 
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THE FLOOR AND THE MAXIMUM FACTOR.—Sub-
paragraphs (A) and (B) shall have no effect on 
the area wage adjustment factor applicable in a 
year to a hospital with an area wage adjust-
ment factor that is greater than the floor under 
subparagraph (A) but less than the maximum 
area wage adjustment factor established under 
subparagraph (B) for the year.’’. 
Æ 
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