H.R. 2314 — FAIR Act

This section modifies the indirect medical education (IME) adjustment under Medicare's inpatient prospective payment system (PPS) for hospitals (i.e., an add-on payment to the PPS base rate reflecting higher indirect patient care costs at teaching hospitals) by reducing a hospital's IME payment amount by 2% for each fiscal year beginning with FY2025 for which the hospital fails to submit specified information to the Secretary of Health and Human Services, with the reduction applying to discharges occurring on or after October 1, 2026. The required information includes, for each approved medical residency training program: (1) the number of applicants from osteopathic and allopathic medical schools; (2) the number of applicants accepted from each; and (3) an affirmation that the hospital considers applicants from both types of schools and, if requiring an exam score, accepts scores from either the Comprehensive Osteopathic Medical Licensing Examination or the United States Medical Licensing Examination at the applicant's election. The Secretary must publish the submitted applicant, acceptance, and affirmation data on a public website for each fiscal year beginning with FY2025; a rule of construction specifies that the amendments do not federalize medical education or mandate acceptance of students from osteopathic or allopathic schools.