TWO-YEAR EXTENSION OF HOLD HARMLESS PROVISIONS FOR SMALL RURAL HOSPITALS AND SOLE COMMUNITY HOSPITALS UNDER THE PROSPECTIVE PAYMENT SYSTEM FOR HOSPITAL OUTPATIENT DEPARTMENT SERVICES.

SEC. 411. TWO-YEAR EXTENSION OF HOLD HARMLESS PROVISIONS FOR SMALL RURAL HOSPITALS AND SOLE COMMUNITY HOSPITALS UNDER THE PROSPECTIVE PAYMENT SYSTEM FOR HOSPITAL OUTPATIENT DEPARTMENT SERVICES.(a) Hold Harmless Provisions.—(1) In general.—Section 1833(t)(7)(D)(i) (42 U.S.C. 1395l(t)(7)(D)(i)) is amended—(A) in the heading, by striking “small” and inserting “certain”; (B) by inserting “or a sole community hospital (as defined in section 1886(d)(5)(D)(iii)) located in a rural area” after “100 beds”; and(C) by striking “2004” and inserting “2006”.(2) Effective date.—The amendment made by paragraph (1)(B) shall apply with respect to cost reporting periods beginning on and after January 1, 2004. (b) Study; Authorization of Adjustment.—Section 1833(t) (42 U.S.C. 1395l(t)) is amended—(1) by redesignating paragraph (13) as paragraph (16); and(2) by inserting after paragraph (12) the following new paragraph:“(13) Authorization of adjustment for rural hospitals.—“(A) Study.—The Secretary shall conduct a study to determine if, under the system under this subsection, costs incurred by hospitals located in rural areas by ambulatory payment classification groups (APCs) exceed those costs incurred by hospitals located in urban areas.“(B) Authorization of adjustment.—Insofar as the Secretary determines under subparagraph (A) that costs incurred by hospitals located in rural areas exceed those costs incurred by hospitals located in urban areas, the Secretary shall provide for an appropriate adjustment under paragraph (2)(E) to reflect those higher costs by January 1, 2006.”.