Adjusting allowable direct and indirect costs for nursing and allied health education programs

(a)

In general

Section 1861(v)(1) of the Social Security Act (42 U.S.C. 1395x(v)(1)) is amended by adding at the end the following new subparagraph:

(X) (i)In determining such reasonable costs for nursing and allied health education furnished by a hospital, beginning with respect to cost reporting periods beginning on or after the date of the enactment of the Rebuild America’s Health Care Schools Act of 2025, the Secretary shall include as reasonable costs all direct and indirect costs incurred by a hospital participating in a nursing and allied health education program licensed by State law or accredited by a national or regional professional organization, including costs that— (I)were directly incurred by the hospital; (II)were allocated to the hospital by a related entity holding the applicable State license or accreditation by a national or regional professional organization; (III)were associated with the training or advanced clinical training of a program participant at the hospital or at a related entity; (IV)were associated with contracts to provide for faculty for the program when such faculty are employed by an educational institution that is not a related entity; or (V)were associated with shared services, such as shared payroll and administrative services, to support the operation of an approved nursing or allied health education program, provided by an educational institution or a clinical site that is a related entity. (ii)For purposes of clause (i), the term related entity means, with respect to a hospital, any entity that is related by common ownership or control to— (I)the hospital itself; or (II)an entity— (aa)in which the hospital (or another entity that is a related entity with respect to the hospital) is the sole corporate member; (bb)that is the sole corporate member of the hospital; (cc)that is part of the same legal entity as the hospital; or (dd)that shares a board with the hospital.

(b)

Allowing health systems and hospital-Based schools To provide clinical training and support

Not later than 120 days after the date of the enactment of this section, the Secretary of Health and Human Services shall issue such rules as are necessary to carry out the amendments made by subsection (a). (c)

Prohibiting recoupment of certain costs under Medicare

(1)

In general

Beginning on the date of the enactment of this section, the Secretary of Health and Human Services may not recoup or reduce payments made to a hospital under part A of title XVIII of the Social Security Act (42 U.S.C. 1395c et seq.) for costs related to an approved nursing or allied health education program that are included on the Medicare cost report for such hospital if such costs would be allowable after the amendments made by subsection (a) take effect. (2)

Refund of amounts recouped

If, during the 6-year period ending on the date of the enactment of this section, the Secretary recouped or reduced payments made to a hospital under such part A for costs described in paragraph (1), the Secretary shall refund to the hospital the amount so recouped or reduced.