Archive for Medicaid disproportionate share

 

CMS Adopts Methodology for Medicaid DSH Cuts

Medicaid DSH money will be allocated among states based on a new methodology under a regulation adopted this week by the Centers for Medicare & Medicaid Services.

But it is not clear when that new methodology may actually be used.

Cuts in Medicaid disproportionate share hospital (Medicaid DSH) allotments to states were mandated by the Affordable Care Act based on the expectation that the law would greatly reduced the number of uninsured Americans.  While this has been the case, the decline in the number of uninsured has not been as great as expected.  For this reason, Congress has on several occasions delayed the required Medicaid DSH cut.

That cut is now scheduled to take effect next week, on October 1, but a continuing resolution to fund the federal government, passed last week by the House and now under consideration by the Senate, would delay that cut again – at least until November 22.

Learn more about the new regulation governing the future allotments of Medicaid DSH money to the states and the prospects for Medicaid DSH allocation cuts being made anytime soon in the Healthcare Dive article “CMS finalizes Medicaid DSH cuts, but Congress could still delay” and see the …

Senate Finance Committee Reports on Supplemental Medicaid Payments

The majority members of the Senate Finance Committee have published a report on supplemental Medicaid payments.

According to the new document,

This report seeks to increase educational understanding of Medicaid supplemental payments, as well as outline the reporting mechanisms for these payments to ensure adequate stewardship of taxpayer dollars. 

The report consists of descriptions of the different types of supplemental Medicaid payments that states make to some providers, including:

  • Medicaid disproportionate share payments (Medicaid DSH)
  • non-DSH payments
  • upper-payment limit payments (UPL payments)
  • demonstration supplemental payments
  • medical education payments

It also describes the magnitude of these payments, noting that supplemental Medicaid payments accounted for $50 billion of the $600 billion spent on Medicaid by the federal and state governments in 2016, the most recent year for which comprehensive data is available.  In addition, it outlines how those payments are distributed while also considering how these payments affect the overall adequacy of Medicaid payments to providers; this varies from state to state.

Finally, the report reviews how the states finance their Medicaid programs, including through provider taxes, intergovernmental transfers, and certified public expenditures, and how states report their supplemental Medicaid payments to the federal government.

To learn more, see the report “Greater

MACPAC Recommends Changes in Medicaid Shortfall Definition

Hospitals’ calculation of their Medicaid shortfall would change under a recommendation that MACPAC voted to make to Congress.  That change, in turn, could affect hospitals’ future Medicaid disproportionate share payments.

Last week the Medicaid and CHIP Payment and Access Commission voted overwhelmingly to change how hospitals calculate their Medicaid shortfall:  the difference between what they spend caring for their Medicaid patients and what Medicaid pays them for that care.  Under MACPAC’s proposal, hospitals would need to deduct from their shortfall total all third-party payments they receive for the care they provide to their Medicaid patients.

If this proposal were to be adopted, it has the potential of changing Medicaid DSH allocations among the states and change the distribution of Medicaid DSH funds within individual states, although the Congressional Budget Office estimates that it would have little impact on either measure.

Complicating the MACPAC recommendation is last year’s federal court ruling that third-party payments could not be deducted from hospitals’ Medicaid shortfall totals because the Centers for Medicare & Medicaid Services lacks the authority to implement such a policy.  Making such a change therefore would require action by Congress.

Learn more about the MACPAC recommendation and its potential implications for hospitals …

MACPAC Meets

The Medicaid and CHIP Payment and Access Commission met for two days last week in Washington, D.C.

The following is MACPAC’s own summary of the sessions.

The Commission wrapped up its work on the June 2019 Report to Congress on Medicaid and CHIP at the April meeting, with sessions reviewing four of the report’s five draft chapters on Thursday morning, and votes on potential recommendations later in the afternoon.

First on Thursday’s agenda was a draft June chapter on Medicaid prescription drug policy, which contained draft recommendations to provide states with a grace period to determine Medicaid drug coverage and raise the cap on rebates. The Commission then revisited hospital payment policy, with a draft chapter and recommendation on how to treat third-party payment in the definition of Medicaid shortfall when determining disproportionate share hospital payments. Next, commissioners considered two recommendations proposed as part of a June chapter on improving the effectiveness of Medicaid program integrity. The final morning session addressed the Commission’s proposed recommendation on therapeutic foster care.

The Commission returned from lunch for two presentations discussing preliminary findings of forthcoming congressionally mandated reports. The first afternoon session presented initial findings from a MACPAC review of state Medicaid utilization

MACPAC Makes DSH, UPL Recommendations

Changes could come in Medicaid DSH and UPL payments if new MACPAC recommendations are adopted.

Last week the Medicaid and CHIP Payment and Access Commission released its annual report to Congress, with most of the report focusing on its analysis and recommendations for policy updates involving Medicaid disproportionate share hospital payments (Medicaid DSH) and Medicaid upper payment limit payments (UPL payments).

With Affordable Care Act-mandated cuts in Medicaid DSH payments scheduled to start in FY 2020 – this coming October – MACPAC recommended that these cuts be reduced and phased in over a longer period of time “…to give states and hospitals more time to respond to the cuts…”

MACPAC also recommended that Congress and the administration revise the current methodology for distributing Medicaid DSH money to the states to “…provide a stronger link between the distribution of those allotments and measures of hospital uncompensated care…”

The commission also addressed UPL payments, expressing concern about “…the discrepancy between reporting by states to show that they are complying with the UPL and the spending data they report to claim federal matching funds” and recommending “…instituting better data and process controls to ensure that state reporting on compliance with UPL lines up …