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Court Rebuffs CMS on Medicaid DSH

A federal court has rejected the manner in which the Centers for Medicare & Medicaid Services collects certain Medicaid data from states in a ruling that has potential implications for eligible hospitals’ Medicaid disproportionate share hospital payments (Medicaid DSH). In a case that challenged how CMS told hospitals to report third-party payments for Medicaid patients, the court ruled against CMS in two different ways:  first, it found that CMS had not interpreted a 2003 law in a manner consistent with congressional intent; and second, it ruled that CMS could not clarify its interpretation through a published FAQ rather than through regulations. As a result of the ruling, some hospitals may get extra room under their hospital-specific Medicaid DSH limit.  For … Read More

Posted in Federal Medicaid issues, Medicaid supplemental payments

The Continued Need for Medicaid DSH

While the Affordable Care Act has greatly increased the number of Americans with health insurance and reduced the demand for uncompensated care from hospitals, many hospitals still see significant numbers of uninsured patients. Some of those patients simply have not taken advantage of the health reform law’s creation of easier access to affordable insurance while others live in states that have not expanded their Medicaid programs. Hospitals that care for especially large numbers of such uninsured patients qualify for Medicaid disproportionate share hospital payments, commonly referred to as Medicaid DSH.  The purpose of these payments is to help these hospitals with the unreimbursed costs they incur caring for such patients. The Affordable Care Act calls for reducing Medicaid DSH payments … Read More

Posted in Affordable Care Act, Federal Medicaid issues, Medicaid supplemental payments

SNAP Writes to House Ways and Means Committee About Medicaid DSH Audits

The federal government should give states the option of monitoring Medicaid disproportionate share payments (Medicaid DSH) to hospitals through prospective DSH limit calculations rather than through retroactive DSH audits. SNAP recently shared this view with the House Ways and Means Committee’s Health Subcommittee in response to that subcommittee’s request for suggestions from stakeholders on ways to improve the delivery of Medicare services and eliminate statutory and regulatory obstacles to more effective care delivery.  According to SNAP, retroactive DSH audits are cumbersome, burdensome, and expensive, give rise to many disputes and appeals, and in the end yield results very similar to much simpler prospective DSH limit calculations performed by the very state governments that distribute Medicaid DSH funds.  See SNAP’s comments … Read More

Posted in Federal Medicaid issues, Medicaid supplemental payments, Pennsylvania safety-net hospitals, Safety-Net Association of Pennsylvania, Uncategorized

New MACPAC Study Evaluates Medicaid, Medicare Payments

Medicaid payments to hospitals are comparable to or even higher than Medicare payments. Or at least they are once supplemental Medicaid payments are included. So concludes a new study by the Medicaid and CHIP Payment and Access Commission, a non-partisan legislative branch agency that advises the states, Congress, and the administration on Medicaid and CHIP payment and access issues. In what MACPAC bills as the “first-ever study to construct a state-level payment index to compare fee-for-service inpatient hospital payments across states and to benchmark Medicaid payments to other payers such as Medicare,” the study found that Across states, base Medicaid payment for inpatient services varies considerably, ranging from 49 percent to 169 percent of the national average. This variation is … Read More

Posted in Medicaid supplemental payments, Pennsylvania Medicaid policy, Uncategorized

CMS Clarifies Medicaid DSH Rule

Last week the Centers for Medicare & Medicaid Services announced a final rule addressing the treatment of third-party payers in calculating Medicaid uncompensated care costs.  This calculation affects individual hospitals’ Medicaid disproportionate share (Medicaid DSH) limit. According to CMS, This rule clarifies federal requirements regarding the treatment of third party payers in determining the hospital-specific Medicaid DSH payment limit, which is set by statute as a hospital’s “uncompensated costs” incurred in providing hospital services to Medicaid and uninsured patients. The final rule makes clearer our existing policy that uncompensated costs include only those costs for Medicaid eligible individuals that remain after accounting for all payments received by or on behalf of Medicaid eligible individuals, including Medicare and other third party … Read More

Posted in Federal Medicaid issues, Medicaid supplemental payments, Pennsylvania Medicaid policy, Pennsylvania safety-net hospitals

MACPAC Looks at Medicaid DSH

Hospitals that serve especially large numbers of Medicaid and low-income patients still need Medicaid disproportionate share hospital payments (Medicaid DSH) to avoid red ink despite the expansion of Medicaid and the increase in the number of uninsured people fostered by the Affordable Care Act. So concludes the Medicaid and CHIP Payment and Access Commission (MACPAC) the non-partisan legislative branch agency that advises Congress, the Secretary of the U.S. Department of Health and Human Services, and the states on Medicaid and Children’s Health Insurance Program issues. In its March 2017 report to Congress, MACPAC writes that In both expansion and non-expansion states, deemed DSH hospitals, which are statutorily required to receive DSH payments because they serve a high share of Medicaid-enrolled … Read More

Posted in Federal Medicaid issues, Medicaid supplemental payments

Integrating Medicaid Supplemental Payments into Value-Based Purchasing

New health care delivery and reimbursement systems and new federal regulations will result in changes in how states deploy their Medicaid resources through supplemental payments in the coming years. A new Commonwealth Fund report describes the kinds of supplemental Medicaid payments states currently make to hospitals – such as disproportionate share and upper payment limit payments – and notes the differing degree to which individual states use such supplemental payments. It also describes how those supplemental payments may be restructured in the coming years to foster greater use of value-based purchasing and to reward achieving state-created quality goals through new delivery and reimbursement systems such as accountable care organizations, bundled payments, shared savings program, capitated arrangements, and shared risk. Such … Read More

Posted in Medicaid supplemental payments, Pennsylvania Medicaid policy

MACPAC Looks at Medicaid DSH

With Medicaid disproportionate share payments (Medicaid DSH) facing future reductions, the agency charged with advising Congress on Medicaid and Children’s Health Insurance payment and access matters is considering what changes the federal supplemental Medicaid payment program might need. At a recent meeting in Washington, D.C., the Medicaid and CHIP Payment and Access Commission discussed the changing role and purpose of Medicaid DSH as more Americans obtain health insurance through private or public sources. MACPAC commissioners noted that hospital uncompensated care is falling, especially in states that have taken advantage of the Affordable Care Act to expand their Medicaid programs. A new Medicaid DSH formula set to be used for FY 2018, based more heavily than the current formula on the … Read More

Posted in Affordable Care Act, Medicaid supplemental payments, Pennsylvania safety-net hospitals

SNAP Comments on Proposed Medicaid DSH Regulation

The Safety-Net Association of Pennsylvania has written to the Centers for Medicare & Medicaid Services to object to how the agency proposes changing its methodology for calculating eligible hospitals’ Medicaid disproportionate share (Medicaid DSH) payments. In particular, SNAP opposes the manner in which CMS would treat payments from Medicare and third-party payers made on behalf of Medicaid-eligible individuals. In SNAP’s view, the letter notes, …the hospital-specific DSH limit has come to penalize the very hospitals that Medicaid DSH payments were designed to support. The SNAP letter explains that What concerns SNAP at this time is CMS’s apparent decision to rationalize and codify in regulations a narrower interpretation of the Medicaid DSH limit than what Congress described in section 1923(g) of … Read More

Posted in Medicaid supplemental payments, Pennsylvania safety-net hospitals, Safety-Net Association of Pennsylvania

CMS Proposes Medicaid DSH Rule

The Centers for Medicare & Medicaid Services has proposed a new rule that would clarify the basis for eligible hospitals’ Medicaid disproportionate share hospital payments (Medicaid DSH). Individual hospitals’ Medicaid DSH payments are based on their uncompensated care costs and the rule clarifies that only uncompensated costs for Medicaid patients for whom hospitals receive no other payments, such as from Medicare, state or local governments, or third-party payers, would count toward their hospital-specific Medicaid DSH limit. See the rule here. Interested parties have until September 15, 2016 to submit formal comments to CMS about its proposal. Representatives of Pennsylvania safety-net hospitals who would like to know more about how this proposal might affect their hospital can use the “contact us” link on … Read More

Posted in Medicaid supplemental payments, Pennsylvania safety-net hospitals
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