Sole Community Hospital Protection Act of 1989

Sole Community Hospital Protection Act of 1989 - Amends title XVIII (Medicare) of the Social Security Act to treat a hospital as a sole community hospital for Medicare payment purposes if it is located: (1) more than 35 miles from other hospitals furnishing short-term, acute care; or (2) 25-to-35 miles from other hospitals furnishing short-term, acute care and not more than 50 percent of part A (Hospital Insurance) Medicare beneficiaries in such hospital's service area are admitted to other hospitals within 35 miles of such hospital or, if larger, within such hospital's service area.

Eliminates the termination date for the provision of additional Medicare payments to sole community hospitals which experience a decline in patient volume of greater than five percent over a cost reporting period due to circumstances beyond their control. Covers a percentage of the losses incurred by low-income sole community hospitals which do not qualify for additional Medicare payments on the basis of declining patient volume. Provides such coverage on a sliding-scale basis with lower-volume hospitals receiving more assistance than higher-volume hospitals.

Exempts a hospital which meets the criteria for classification as a sole community hospital from Medicare payment reductions for capital-related costs, even if the hospital does not accept such designation for Medicare payment purposes.