Congress guarantees Alaska, Hawaii hospitals 94% cost reimbursement—no offset required.
S. 553 — SOLES Act · Filed by Dan Sullivan (R-AK) · 2 cosponsors · Introduced Feb 12, 2025 · Referred to committee
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What it does
This bill requires Medicare to guarantee that sole community hospitals in Alaska and Hawaii receive payment for outpatient services at no less than 94% of their reasonable costs. If Medicare's standard payment formula falls short of that floor, the bill mandates a top-up payment to reach it—without requiring offsetting cuts elsewhere in the Medicare budget.
Why we flagged it
The bill's sole operative mechanism is establishing a minimum reimbursement guarantee for a specific class of hospitals in two states, protecting them from below-cost Medicare payments.
What the text implies
- The 94% floor is indexed to 'reasonable costs' as defined in Section 1861(v), which may shift over time; the bill does not cap total exposure or require periodic review.
- Exemption from 'budget neutral' implementation means the cost is not offset by reductions elsewhere in the outpatient payment system, creating open-ended Medicare spending growth.
The full analysis lists 4 implications of this text.
Who stands to gain
sole community hospitals in Alaska and Hawaii; rural hospital operators in remote regions