The Keeping Obstetrics Local Act aims to stabilize rural maternity care through enhanced hospital funding, expand postpartum coverage under Medicaid, invest in the maternal health workforce, and mandate transparency regarding unit closures.
Ron Wyden
Senator
OR
The Keeping Obstetrics Local Act is a comprehensive bill designed to stabilize rural and safety-net hospitals providing maternity care through enhanced financial support, including minimum Medicaid payment rates and anchor payments. It also expands continuous Medicaid and CHIP coverage for new mothers for a full year postpartum and invests in the maternal health workforce by supporting emergency staffing and simplifying cross-state provider enrollment. Finally, the act mandates greater transparency by requiring hospitals to give advance public notice of obstetric unit closures and report more detailed operational data to Medicare.
New Bill Guarantees 12 Months of Postpartum Medicaid Coverage and $1.2M Safety Net for Rural Maternity Units
The “Keeping Obstetrics Local Act” is a major legislative move aimed squarely at fixing a problem that’s become way too common: losing local maternity care, especially in rural areas, and the dangerous gap in health coverage new mothers face after giving birth. This bill doesn't just ask hospitals nicely to stay open; it rewrites the financial rules for how they get paid and expands coverage for millions of people.
The Financial Lifeline for Local Birth Centers
If you live in a rural area, you know the drill: the local hospital cuts services, and suddenly, you’re driving an hour or more for basic care. This bill attacks that issue by boosting the money flow to hospitals that provide maternity services, particularly those in rural areas or that serve many Medicaid patients. Starting in 2027, Medicaid payments to these eligible hospitals for labor and delivery can’t be less than 150% of what Medicare would pay for the same service (Sec. 102). That’s a huge minimum floor designed to keep the lights on in birth units that are currently losing money.
Even more important is the creation of an annual “anchor payment” for low-volume obstetric hospitals—those handling fewer than 300 births a year (Sec. 104). Starting in 2028, these hospitals are guaranteed a minimum of $1.2 million annually just to cover the fixed costs of being ready 24/7. Think of it as a standby fee. In exchange for this guaranteed payment, the hospital must agree to keep providing services for the next two full fiscal years. If they break that contract, the state can claw back the money. This is a direct, substantial subsidy designed to stop the bleeding in small, essential maternity units.
Ending the Postpartum Coverage Cliff
For anyone who has had a baby on Medicaid, the biggest stressor is the coverage cliff. Medicaid currently covers pregnancy and birth, but in many states, that coverage vanishes 60 days after delivery. This bill mandates that all states provide 12 months of continuous, full-benefit coverage under both Medicaid and CHIP for pregnant and postpartum individuals (Sec. 201). This change is massive. It means a new mother can get the care she needs for depression, anxiety, chronic conditions, or complications for a full year after giving birth, dramatically improving health outcomes and reducing the risk of maternal mortality.
To make that care better, the bill also creates a new option for states to offer “maternity health homes” starting in 2028 (Sec. 202). This is a coordinated care model where a team of providers (which can include doulas and community health workers) manages all of a new mother’s needs—from physical recovery to behavioral health and social support—for that entire 12-month period. To encourage states to cover more holistic care, the bill also requires HHS to issue guidance on how states can easily cover services provided by doulas and midwives (Sec. 203).
Staffing, Transparency, and the Real-World Impact
Recognizing that money isn't the only problem, the bill also addresses the workforce shortage. It sets up a streamlined process for states to quickly enroll maternity providers (doctors, midwives, etc.) from neighboring states to practice across state lines (Sec. 302). If you live near a state border and your local unit is understaffed, this could quickly open up a new pool of available doctors.
Finally, the bill mandates transparency. If a hospital decides to close its obstetric unit, it must now provide 180 days’ notice to the community and state agencies (Sec. 401). This notice must include a detailed report on the closure’s expected impact, including potential negative health outcomes and rising costs for local families. This stops hospitals from making sudden, disruptive closure announcements and forces them to justify the decision publicly. It also requires hospitals to start tracking and reporting detailed data on C-section rates, staffing costs, and revenue sources for their labor and delivery units (Sec. 402), giving policymakers and the public a much clearer picture of where the money is actually going.