Codification of the Medicare low-wage index hospital policy

Section 1886(d)(3)(E) of the Social Security Act (42 U.S.C. 1395ww(d)(3)(E)) is amended— (1) in clause (i), in the first sentence, by striking or (iv) and inserting, (iv), or (v); and (2) by adding at the end the following new clause: (v) Area wage index adjustment for low-wage hospitals (I) In general For discharges occurring on or after October 1, 2019, the area wage index applicable under this subparagraph for a fiscal year to a hospital with an area wage index (determined without regard to this clause) below the 25th percentile area wage index shall be increased by ½ of the difference between the otherwise applicable final area wage index for such fiscal year for such hospital and the 25th percentile area wage index for such fiscal year across all hospitals. (II) Budget neutrality Pursuant to the fourth sentence of clause (i), this clause shall be applied in a budget neutral manner. Any adjustments made for the purposes of such application of budget neutrality may not— (aa) decrease the area wage index applicable under this subparagraph to a hospital with an area wage index (determined without regard to this clause) below the 75th percentile area wage index for the fiscal year; or (bb) result in an area wage index applicable under this subparagraph to a hospital for such fiscal year that is less than 95 percent of the area wage index applicable under this subparagraph to such hospital for the preceding fiscal year..