To amend title XVIII of the Social Security Act to make rural health care improvements under the Medicare Program.

[AI summary unavailable — showing source text] Title III: Rural Health Care Improvements (sic) - Amends title XVIII (Medicare) of the Social Security Act (SSA) to provide that starting for discharges on or after October 1, 2002, hospitals (other than urban hospitals with a 100 or more beds or certain public hospitals) will receive payments based on a blend of their current disproportionate share (DSH) adjustment and the current DSH adjustment for large urban hospitals. Limits such new DSH adjustment. Provides that for discharges occurring: (1) during FY 2003, the average standardized amount for hospitals located other than in a large urban area shall be increased by half the difference between the average standardized amount for hospitals located in large urban areas for such fiscal year and such amount determined for other hospitals for such fiscal year; and (2) during FY 2004 and afterwards, the Secretary shall compute one standardized amount for all hospitals increased by the applicable percentage increase, and use this amount to pay all hospitals. Directs the Secretary of Health and Human Services, after revising the market basket cost weights to reflect the most current data available, to establish a frequency for revising…