Current through Register Vol. 41, No. 3, September 23, 2024
A. Payments to disproportionate share
hospitals (DSH) shall be prospectively determined in advance of the state
fiscal year to which they apply. The payments shall be made on a quarterly
basis and shall be final subject to subsections E and K of this
section.
B. Effective July 1, 2014,
in order to qualify for DSH payments, DSH eligible hospitals shall have a total
Medicaid inpatient utilization rate equal to 14% or higher in the base year
using Medicaid days eligible for Medicare DSH defined in
42
USC §
1396r-4(b)(2) or
a low income utilization rate defined in
42
USC §
1396r-4(b)(3) in
excess of 25%. Eligibility for out-of-state cost reporting hospitals shall be
based on total Medicaid utilization or on total Medicaid neonatal intensive
care unit (NICU) utilization equal to 14% or higher. Effective July 1, 2018,
freestanding children's hospitals located in the District of Columbia shall not
be eligible for DSH payments.
C.
Effective July 1, 2014, the DSH reimbursement methodology for all hospitals
except Type One hospitals is the following:
1. Each hospital's DSH payment shall be equal
to the DSH per diem multiplied by each hospital's eligible DSH days in a base
year. Days reported in provider fiscal years in state fiscal year (FY) 2011
(available from the Medicaid cost report through the Hospital Cost Report
Information System (HCRIS) as of July 30, 2013) will be the base year for FY
2015 prospective DSH payments. DSH shall be recalculated annually with an
updated base year. Future base year data shall be extracted from Medicare cost
report summary statistics available through HCRIS as of October 1 prior to next
year's effective date.
2. Eligible
DSH days are the sum of all Medicaid inpatient acute, psychiatric, and
rehabilitation days above 14% for each DSH hospital subject to special rules
for out-of-state cost reporting hospitals. Eligible DSH days for out-of-state
cost reporting hospitals shall be the higher of the number of eligible days
based on the calculation in the first sentence of this subdivision times
Virginia Medicaid utilization (Virginia Medicaid days as a percent of total
Medicaid days) or the Medicaid NICU days above 14% times Virginia NICU Medicaid
utilization (Virginia NICU Medicaid days as a percent of total NICU Medicaid
days). Eligible DSH days for out-of-state cost reporting hospitals that qualify
for DSH but that have less than 12% Virginia Medicaid utilization shall be 50%
of the days that would have otherwise been eligible DSH days.
3. Additional eligible DSH days are days that
exceed 28% Medicaid utilization for Virginia Type Two hospitals, excluding
Children's Hospital of the Kings Daughters (CHKD).
4. The DSH per diem shall be calculated in
the following manner:
a. The DSH per diem for
Type Two hospitals is calculated by dividing the total Type Two DSH allocation
by the sum of eligible DSH days for all Type Two DSH hospitals. For purposes of
DSH, Type Two hospitals do not include CHKD or any hospital whose reimbursement
exceeds its federal uncompensated care cost limit. The Type Two hospital DSH
allocation shall equal the amount of DSH paid to Type Two hospitals in state FY
2014 increased annually by the percent change in the federal allotment,
including any reductions as a result of the Patient Protection and Affordable
Care Act (Affordable Care Act),
Public Law
111-148, adjusted for the state fiscal year.
Effective July 1, 2018, the Type Two hospital DSH allocation shall be reduced
by the amount of DSH allocated to freestanding children's hospitals located in
the District of Columbia.
b. The
DSH per diem for state inpatient psychiatric hospitals is calculated by
dividing the total state inpatient psychiatric hospital DSH allocation by the
sum of eligible DSH days. The state inpatient psychiatric hospital DSH
allocation shall equal the amount of DSH paid in state FY 2013 increased
annually by the percent change in the federal allotment, including any
reductions as a result of the Affordable Care Act, adjusted for the state
fiscal year.
c. Effective July 1,
2017, the annual DSH payment shall be calculated separately for each eligible
hospital by multiplying each year's state inpatient psychiatric hospital DSH
allocation described in subdivision C 4 b of this section by the ratio of each
hospital's uncompensated care cost for the most recent DSH audited year
completed prior to the DSH payment year to the uncompensated care cost of all
state inpatient psychiatric hospitals for the same audited year.
d. The DSH per diem for CHKD shall be three
times the DSH per diem for Type Two hospitals.
5. Each year, the department shall determine
how much Type Two DSH has been reduced as a result of the Affordable Care Act
and adjust the percent of cost reimbursed for outpatient hospital
reimbursement.
D.
Effective July 1, 2014, the DSH reimbursement methodology for Type One
hospitals shall be to pay its uncompensated care costs up to the available
allotment. Interim payments shall be made based on estimates of the
uncompensated care costs and allotment. Payments shall be settled at cost
report settlement and at the conclusion of the DSH audit.
E. Prior to July 1, 2014, hospitals
qualifying under the 14% inpatient Medicaid utilization percentage shall
receive a DSH payment based on the hospital's type and the hospital's Medicaid
utilization percentage.
1. Type One hospitals
shall receive a DSH payment equal to:
a. The
sum of (i) the hospital's Medicaid utilization percentage in excess of 10.5%,
times 17, times the hospital's Medicaid operating reimbursement, times 1.4433
and (ii) the hospital's Medicaid utilization percentage in excess of 21%, times
17, times the hospital's Medicaid operating reimbursement, times 1.4433.
b. Multiplied by the Type One
hospital DSH factor. The Type One hospital DSH factor shall equal a percentage
that when applied to the DSH payment calculation yields a DSH payment equal to
the total calculated using the methodology outlined in subdivision 1 a of this
subsection using an adjustment factor of one in the calculation of operating
payments rather than the adjustment factor specified in subdivision B 1 of
12VAC30-70-331.
2. Type Two hospitals shall receive a DSH
payment equal to the sum of (i) the hospital's Medicaid utilization percentage
in excess of 10.5%, times the hospital's Medicaid operating reimbursement,
times 1.2074 and (ii) the hospital's Medicaid utilization percentage in excess
of 21%, times the hospital's Medicaid operating reimbursement, times 1.2074.
Out-of-state cost reporting hospitals with Virginia utilization in the base
year of less than 12% of total Medicaid days shall receive 50% of the payment
described in this subsection.
F. Hospitals qualifying under the 25%
low-income patient utilization rate shall receive a DSH payment based on the
hospital's type and the hospital's low-income utilization rate.
1. Type One hospitals shall receive a DSH
payment equal to the product of the hospital's low-income utilization in excess
of 25%, times 17, times the hospital's Medicaid operating
reimbursement.
2. Type Two
hospitals shall receive a DSH payment equal to the product of the hospital's
low-income utilization in excess of 25%, times the hospital's Medicaid
operating reimbursement.
3.
Calculation of a hospital's low-income patient utilization percentage is
defined in
42
USC §
1396r-4(b)(3).
G. Each hospital's
eligibility for DSH payment and the amount of the DSH payment shall be
calculated at the time of each rebasing using the most recent reliable
utilization data and projected operating reimbursement data available. The
utilization data used to determine eligibility for DSH payment and the amount
of the DSH payment shall include days for Medicaid recipients enrolled in
capitated managed care programs. In years when DSH payments are not rebased in
the way described in this section, the previous year's amounts shall be
adjusted for inflation.
For freestanding psychiatric facilities licensed as
hospitals, DSH payment shall be based on the most recently settled Medicare
cost report available before the beginning of the state fiscal year for which a
payment is being calculated.
H. Effective July 1, 2010, DSH payments shall
be rebased for all hospitals with the final calculation reduced by a uniform
percentage such that the expenditures in FY 2011 do not exceed expenditures in
FY 2010 separately for Type One and Type Two hospitals. The reduction shall be
calculated after determination of eligibility. Payments determined in FY 2011
shall not be adjusted for inflation in FY 2012.
I. Effective July 1, 2013, DSH payments shall
not be rebased for all hospitals in FY 2014 and shall be frozen at the payment
levels for FY 2013 eligible providers.
J. To be eligible for DSH, a hospital shall
also meet the requirements in
42
USC §
1396r-4(d). No
DSH payment shall exceed any applicable limitations upon such payment
established by
42
USC §
1396r-4(g).
K. If making the DSH payments prescribed in
this chapter would exceed the DSH allotment, DMAS shall adjust DSH payments to
Type One hospitals. Any DSH payment not made as prescribed in the State Plan as
a result of the DSH allotment shall be made upon a determination that an
available allotment exists.
L.
Effective July, 1, 2020, a supplemental DSH payment shall be made quarterly for
non-state government, public acute care hospitals up to its hospital-specific
DSH (Omnibus Reconciliation Act 1993 DSH limit) as determined pursuant to
42
USC §
1396r-4(g)(1).
The annual payment total shall be based upon the hospital's disproportionate
share limit for the most recent year for which the disproportionate share limit
has been calculated subject to the availability of DSH funds under the federal
allotment of such funds to the department.
Statutory Authority: §
32.1-325
of the Code of Virginia;
42 USC §
1396 et
seq
