Medicare to reimburse hospitals more for nursing schools—no proof of better training
H.R. 1708 — Rebuild America’s Health Care Schools Act of 2025 · Filed by Darin LaHood (R-IL) · 19 cosponsors · Introduced Feb 27, 2025 · Referred to committee
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What it does
This bill expands what hospitals can charge Medicare for nursing and allied health education programs. It allows hospitals to count both direct costs (their own spending) and indirect costs (expenses allocated from related entities like parent companies or sister organizations) as reimbursable, and it prevents Medicare from recouping payments already made under the old rules. Hospitals and health systems that run nursing schools stand to gain significantly higher reimbursement.
Why we flagged it
The bill's core function is to increase what hospitals can bill Medicare for nursing and allied health education by broadening the definition of allowable costs and preventing recoupment of previously paid amounts. This is a direct financial benefit to hospital systems, not a policy reform aimed at improving education access or quality.
What the text implies
- The 'related entity' definition is broad enough to allow hospitals to allocate costs from parent companies, sister hospitals, and other affiliated organizations—potentially inflating education costs beyond what the hospital itself actually spent.
- The 6-year refund provision creates a retroactive windfall: hospitals recoup money Medicare already denied them, with no requirement to demonstrate that the education quality or enrollment improved.
The full analysis lists 4 implications of this text.
Who stands to gain
large hospital systems and health networks; for-profit hospital operators; hospital-affiliated nursing schools