Local Health Care Protection Act of 2026
Sponsored By: Representative Scholten, Hillary J. [D-MI-3]
Introduced
Summary
Temporarily preserves 340B drug discount status for certain hospitals that lose a required disproportionate share hospital (DSH) percentage. It would deem hospitals that met 340B subparagraphs L, M, or O and were participating on July 3, 2025, as covered entities for cost reporting periods starting in fiscal year 2026 or later that end by September 30, 2030.
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- Hospitals: Hospitals that were covered entities under 340B subparagraphs L, M, or O and participated on July 3, 2025 would be treated as covered entities for specified cost reporting periods even if they fail the DSH percentage test. This temporary designation runs for reporting periods beginning in FY2026 through those ending no later than Sept 30, 2030.
- Rural and underserved areas: The bill directs the Comptroller General to study whether declining payments in rural areas under SSA section 1886(d)(5)(F) correlate with reductions in critical services. The study must also look at causes like limited post-acute care capacity.
- Policymakers: The Comptroller General must deliver a report within one year that reviews 340B covered-entity criteria, state rules for DSH under SSA section 1923, current proposals and methods for revising the SSA section 1886 payment adjustment formula, litigation effects, and common causes of payment declines including disability determination backlogs.
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Bill Overview
Analyzed Economic Effects
1 provisions identified: 1 benefits, 0 costs, 0 mixed.
Temporary 340B coverage for hospitals
If enacted, this bill would temporarily treat certain hospitals as 'covered entities' under the federal 340B drug discount program even if they miss the disproportionate share (DSH) percentage for some cost reporting periods. It would apply only to hospitals that on July 3, 2025 were covered under subparagraphs L, M, or O of 340B(a)(4) and were participating in the 340B program. The deemed coverage would apply to cost reporting periods that begin in fiscal year 2026 or later and end by September 30, 2030. Hospitals must still meet all other 340B rules; for L or M hospitals the DSH test referenced would be subparagraph L(ii), and for O hospitals it would be the subparagraph O DSH percentage. This would help patients at those hospitals keep access to discounted drugs and related services during that period.
Sponsors & CoSponsors
Sponsor
Scholten, Hillary J. [D-MI-3]
MI • D
Cosponsors
There are no cosponsors for this bill.
Roll Call Votes
No roll call votes available for this bill.
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