S. 474 – Fair Funding for Rural Hospitals Act

AI-Generated Summary

Updated November 24, 2025 at 2:53 AM UTC

The Fair Funding for Rural Hospitals Act changes the Medicaid formula in the Social Security Act so that every state must receive a baseline level of funding for hospitals that serve a large share of low‑income patients. It guarantees a $20 million minimum DSH payment to each state from 2025 through 2029, and then ties the minimum to the previous year’s amount with inflation adjustments thereafter. This aims to ensure stable federal support for rural and other high‑need hospitals across all states.

Key Provisions

Adds a new rule that each state’s Medicaid Disproportionate Share Hospital (DSH) payment cannot fall below a set minimum amount.
For fiscal years 2025 through 2029, the minimum DSH allotment for every state is fixed at $20 million.
Starting in fiscal year 2030, the minimum amount will continue at the prior year’s level but will be increased each year to keep up with inflation.

Legislative Activity

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1 earlier action

SenateIntro Referral Latest Action

Read twice and referred to the Committee on Finance. (text: CR S796)

Finance Committee

February 6, 2025

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SenateIntro Referral

Introduced in Senate

February 6, 2025

SenateIntro Referral

Read twice and referred to the Committee on Finance. (text: CR S796)

Finance Committee

February 6, 2025

Floor Debate

5 members

What members said about S. 474 on the floor

2 Republicans3 Democrats

Sen. Alex PadillaD-CA · Feb 5, 2025

Mr. President, I rise today to introduce the Wildfire Intelligence Collaboration and Coordination Act of 2025. This legislation would establish a joint wildfire intelligence center between the…

Sen. John ThuneR-SD · Feb 5, 2025

Mr. President, I ask unanimous consent that the text of the bill be printed in the Record. There being no objections, the text of the bill was ordered to be

Sen. Richard J. DurbinD-IL · Feb 5, 2025

Mr. President, I ask unanimous consent that the text of the bill be printed in the Record.

Sen. John BarrassoR-WY · Feb 5, 2025

Mr. President, I ask unanimous consent that the text of the bill be printed in the Record.

Sen. Charles E. SchumerD-NY · Feb 5, 2025

Mr. President, I ask unanimous consent that the text of the bill be printed in the Record.

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Sen. John BarrassoR-WY · Feb 5, 2025

Mr. President, I ask unanimous consent that the text of the bill be printed in the Record.

Bill Text

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Introduced in SenateIssued February 6, 2025

II

119th CONGRESS

1st Session

S. 474

IN THE SENATE OF THE UNITED STATES

February 6 (legislative day, February 5), 2025

Mr. Barrasso (for himself, Mr. Schatz, Mr. Cramer, and Mr. Welch) introduced the following bill; which was read twice and referred to the Committee on Finance

A BILL

To amend title XIX of the Social Security Act to establish a minimum Medicaid disproportionate share hospital allotment for States.

1.

Short title

This Act may be cited as the Fair Funding for Rural Hospitals Act.

2.

Minimum Medicaid DSH allotment

Section 1923(f)(6) of the Social Security Act (42 U.S.C. 1396r–4(f)(6)) is amended by adding at the end the following new subparagraph:

(C)

Minimum DSH allotment for fiscal years after 2024

(i)

In general

Notwithstanding the table set forth in paragraph (2) or the reductions required under paragraph (7), for fiscal year 2025 and each succeeding fiscal year, the DSH allotment for any State shall not be less than the minimum DSH allotment amount established for the fiscal year under clause (ii).

(ii)

Minimum DSH allotment amount

The minimum DSH allotment amount established under this clause—

(I)

for each of fiscal years 2025 through 2029, shall be equal to $20,000,000; and

(II)

for fiscal year 2030 and each succeeding fiscal year, shall be equal to the minimum DSH allotment amount established under this clause for the preceding fiscal year, subject to an increase for inflation as provided in paragraph (3)(A).

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