SB 552, the CRITICAL Act, would amend Medicare payment rules in Title XVIII of the Social Security Act to increase reimbursement for certain services furnished by critical access hospitals located in a noncontiguous state. For inpatient critical access hospital services, outpatient critical access hospital services, ambulance services, and covered skilled nursing facility services provided by or through such hospitals, the bill would raise the Medicare payment rate from 101 percent of reasonable costs to 105 percent, beginning January 1, 2026. The bill applies specifically to critical access hospitals in noncontiguous states, a category that would primarily affect Alaska and Hawaii.
The measure is narrowly targeted to rural and geographically isolated providers that often face higher operating and transportation costs. By increasing Medicare reimbursement, it is intended to improve financial stability for these hospitals and the services they support, including emergency transport and post-acute care. The bill does not broadly rewrite Medicare, but instead creates a special payment rule for a defined subset of facilities and services under the Medicare program.
Impact
The bill would amend sections 1814, 1834, and 1883 of the Social Security Act to create a higher Medicare reimbursement rate for critical access hospital services in noncontiguous states. This would directly affect Medicare payment calculations for inpatient care, outpatient care, ambulance services, and skilled nursing facility services tied to qualifying hospitals, increasing federal spending for those claims starting in 2026. It would not change eligibility for Medicare or the general critical access hospital framework, but it would create a special statutory payment exception for hospitals in noncontiguous states.
Sentiment
There is no recorded committee transcript or vote history in the provided materials, so there is no formal evidence of debate or opposition in the record here. The bill’s introduction by Senators Sullivan and Schatz suggests bipartisan sponsorship and a generally supportive posture toward improving reimbursement for rural and remote providers. Overall, the bill appears to be framed as a technical but beneficial Medicare adjustment for underserved noncontiguous-state hospitals.
Contention
The main policy issue is whether critical access hospitals in noncontiguous states should receive a higher Medicare cost-based payment than the standard 101 percent rate. Supporters are likely to argue that Alaska and Hawaii face unique cost and access challenges that justify the 105 percent rate, especially for ambulance and skilled nursing services. Potential concerns, if raised, would center on increased Medicare spending, the fairness of creating a state-specific payment exception, and whether the higher reimbursement should be limited to these states or extended through broader rural hospital payment reform.