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119th CONGRESS
1st Session
H.R. 17

IN THE SENATE
Q3, 2025
Ms. O'Hare (for herself and others with thanks to Ms. Underwood, Mr. Warner, and Ms. Rosen introduced the following bill; 

A BILL

To prioritize rural hospitals, expand telehealth, distance learning, and other purposes.

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,

SECTION 1. Short title.

This Act may be cited as the “Prioritizing Rural Healthcare and Education Act”.

SEC. 2. Prioritization under the Community Facilities Loan and Grant Program.

(a) In general.—In selecting recipients of direct loans or grants for the development of essential community facilities under section 306(a) of the Consolidated Farm and Rural Development Act (7 U.S.C. 1926(a)) for fiscal years 2026 through 2032, the Secretary of Agriculture shall give priority to entities eligible for those direct loans or grants to develop facilities to provide healthcare or mental or behavioral healthcare.

(b) Use of funds.—An eligible entity described in subsection (a) that receives a direct loan or grant described in subsection (a) may use the direct loan or grant funds for medical supplies, increasing telehealth capabilities, supporting staffing needs, or renovating and remodeling closed facilities.

(c) Reservation of funds.—Of the amounts made available for guaranteed loans under section 310B(g) of the Consolidated Farm and Rural Development Act for each of fiscal years 2026 through 2032, 10 percent shall be reserved to carry out this section.

SEC 3. 

Ensuring fairness in medicare hospital payments.

(a) Hospital inpatient services.—

(1) IN GENERAL.—Section 1886(d)(3)(E) of the Social Security Act (42 U.S.C. 1395ww(d)(3)(E)) is amended—

(A) in clause (i), in the first sentence, by striking “or (iv)” and inserting “, (iv), or (v)”; and

(B) by adding at the end the following new clause:


“(v) AREA WAGE INDEX FLOOR.—

“(I) IN GENERAL.—For discharges occurring on or after October 1, 2026, 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 0.85.

“(II) WAIVING BUDGET NEUTRALITY.—Pursuant to the fifth sentence of clause (i), this clause shall not be applied in a budget neutral manner.”.

(2) WAIVING BUDGET NEUTRALITY.—

(A) TECHNICAL AMENDATORY CORRECTION.—Section 10324(a)(2) of Public Law 111–148 is amended by striking “third sentence” and inserting “fifth sentence”.

(B) WAIVER.—Section 1886(d)(3)(E)(i) of the Social Security Act (42 U.S.C. 1395ww(d)(3)(E)(i)) is amended, in the fifth sentence—

(i) by striking “and the amendments” and inserting “, the amendments”; and

(ii) by inserting “, and the amendments made by section 2(a)(1) of the Save Rural Hospitals Act of 2026” after “Act of 2021”.

(b) Hospital outpatient department services.—Section 1833(t) of the Social Security Act (42 U.S.C. 1395l(t)), is amended—

(1) in paragraph (2)(D), by striking “(19), the Secretary” and inserting “(19) and paragraph (23), the Secretary”; and

(2) by adding at the end the following new paragraph:

“(23) FLOOR ON AREA WAGE ADJUSTMENT FACTOR FOR HOSPITAL OUTPATIENT DEPARTMENT SERVICES.—With respect to covered OPD services furnished on or after January 1, 2024, the area wage adjustment factor applicable under the payment system established under this subsection to any hospital outpatient department which is not located in a frontier State (as defined in section 1886(d)(3)(E)(iii)(II)) may not be less than 0.85. The preceding sentence shall not be implemented in a budget neutral manner.”.

SEC 4. Distance learning and telemedicine grant program.

(a) Use of grants for operating expenses.—Section 2333 of the Food, Agriculture, Conservation, and Trade Act of 1990 (7 U.S.C. 950aaa–2) is amended—

(1) in subsection (a), by inserting “and operation” after “construction”;

(2) in subsection (c)—

(A) in paragraph (1)(B), by adding “and” at the end; and

(B) in paragraph (2)(A), by striking “or extend” each place it appears and inserting “extend, or operate”;

(3) in subsection (f)—

(A) in paragraph (3), by striking “or” at the end;

(B) by redesignating paragraph (4) as paragraph (5); and

(C) by inserting after paragraph (3) the following:


“(4) operation of the programming, equipment, or facilities referred to in paragraphs (1) and (2); or”; and

(4) by striking subsection (g) and inserting the following:


“(g) Operating expenses.—Not more than 15 percent of the amount of financial assistance provided to a recipient under this chapter may be used for recurring or operating expenses, including salaries or administrative expenses, that are reasonable and allocable to the project carried out by the recipient.”.

(b) Waiver of matching requirement.—Section 2334 of the Food, Agriculture, Conservation, and Trade Act of 1990 (7 U.S.C. 950aaa–3) is amended by adding at the end the following:


“(g) Waiver of matching requirement.—The Secretary shall waive any requirement for a recipient of financial assistance under this chapter to provide non-Federal matching funds—

“(1) in a case of demonstrated need or if the matching requirement would create a substantial burden, as determined by the Secretary; or

“(2) if the recipient is a federally recognized Indian Tribe.”.

(c) Authorization of appropriations.—Section 2335A of the Food, Agriculture, Conservation, and Trade Act of 1990 (7 U.S.C. 950aaa–5) is amended by striking “2019 through 2023” and inserting “2025 through 2030”.

(d) Set-Aside for substance use disorder treatment and mental health services.—

(1) IN GENERAL.—

(A) SUBSTANCE USE DISORDER SET-ASIDE.—Subject to subparagraph (B), for each of fiscal years 2026 through 2030, the Secretary of Agriculture shall make available not less than 20 percent of amounts made available under section 2335A of the Food, Agriculture, Conservation, and Trade Act of 1990 (7 U.S.C. 950aaa–5) for financial assistance under chapter 1 of subtitle D of title XXIII of that Act (7 U.S.C. 950aaa et seq.) for telemedicine projects that provide substance use disorder treatment services or mental health services.

(B) EXCEPTION.—In the case of a fiscal year for which the Secretary of Agriculture determines that there are not sufficient qualified applicants to receive financial assistance for projects providing substance use disorder treatment services or mental health services to reach the 20-percent requirement under subparagraph (A), the Secretary of Agriculture may make available less than 20 percent of amounts made available under section 2335A of the Food, Agriculture, Conservation, and Trade Act of 1990 (7 U.S.C. 950aaa–5) for those services.

(2) CONFORMING AMENDMENTS.—Section 6101(a)(1)(A)(i) of the Agriculture Improvement Act of 2018 (Public Law 115–334; 132 Stat. 4726) is amended—

(A) by inserting “for each of fiscal years 2019 through 2023,” before “the Secretary”; and

(B) by striking “(7 U.S.C. 950aaa–2)” and inserting “(7 U.S.C. 950aaa–5)”.

PES:

Section 2: To prioritize healthcare facilities and mental or behavioral health facilities in the Community Facilities program for fiscal years 2026 through 2032 and allow loans and grants under the program to be used for medical supplies, increasing telehealth capabilities, supporting staffing needs, or renovating and remodeling closed facilities.

Section 3: This Section establishes an area wage adjustment floor for Medicare hospital payments in states that are not frontier states and excludes such adjustments from certain budget neutrality rules.

Section 4: This section reauthorizes through FY2030 and modifies the Distance Learning and Telemedicine Loan and Grant Program that is administered by the Department of Agriculture (USDA). The program supports telemedicine and distance learning services in rural areas through telecommunications, computer networks, and other advanced technology by students, teachers, medical professionals, and residents of rural areas. The section expands the scope of the program to specifically allow the use of program funds for operational expenses associated with telemedicine programs. It also allows the USDA to waive matching fund requirements in certain circumstances and requires USDA to set aside a specific amount of funding allotments for programs that focus on substance use disorder treatment or mental health services.

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