June 17,2024

Wyden, Senate Democrats Release Legislation to Stop Labor and Delivery Unit Closures in Rural and Underserved Communities

Draft Bill Uses Medicaid Funding to Bolster Rural Hospitals, Keep Resources in Local Communities

Washington, D.C. – Senate Finance Committee Chair Ron Wyden, D-Ore., and 16 Senate Democrats today released draft legislation to address a rising trend of rural hospitals and hospitals in underserved areas closing their labor and delivery units with significant consequences for expectant parents, families, and their local communities.

“Too many rural communities have become maternity deserts – it’s time to turn the tide and offer some stability to rural hospitals that want to help families give birth in their own communities,” Wyden said. “This legislation will give rural and underserved hospitals the means to keep their labor and delivery units open, and ensures that large hospital chains will not take the money and run.”

Between 2012 and 2022, approximately one quarter of all rural hospitals stopped providing obstetrics services, impacting 267 communities. This trend of closures is caused by several overlapping challenges, including the high fixed operating costs of these units, low volumes of births, and difficulties in attracting and retaining OB-trained clinical staff, all of which is made worse by inadequate reimbursement for labor and delivery services.

The proposal, titled the Keep Obstetrics Local Act (KOLA), would increase Medicaid payment rates for labor and delivery services for eligible rural and high-need urban hospitals, provide “standby” payments to cover the costs of staffing and maintaining an obstetrics unit at low-volume hospitals, create low-volume payment adjustments for labor and delivery services at hospitals with low birth volumes and require all states to provide postpartum coverage for women in Medicaid for 12 months, among other steps. The proposal makes sure that hospitals are required to use these additional resources to invest in the maternal health care needs of the local communities they serve.

The proposal has been endorsed by the American College of Nurse-Midwives, America’s Essential Hospitals, Catholic Health Association, Community Catalyst, Families USA, Hospital Association of Oregon, National Partnership for Women & Families, National Rural Health Association, and the Oregon Perinatal Collaborative.

Joining Wyden to release the draft legislation are Senators Debbie Stabenow, D-Mich., Maria Cantwell, D-Wash., Bob Menendez, D-N.J., Tom Carper, D-Del., Ben Cardin, D-Md., Sherrod Brown, D-Ohio, Michael Bennet, D-Colo., Bob Casey Jr., D-Penn., Mark Warner, D-Va., Sheldon Whitehouse, D-R.I., Maggie Hassan, D-N.H., Catherine Cortez Masto, D-Nev., Elizabeth Warren, D-Mass., Tammy Duckworth, D-Ill., Corey Booker, D-N.J and Jeff Merkley, D-Ore.

A summary and section by section of the draft legislation can be found here. Legislative text can be found here.