Medicaid disproportionate share payments / Jean Hearne.

Format:

Book

Author/Creator:

Hearne, Jean, author.

Series:

CRS report for Congress.

CRS report for Congress

Language:

English

Subjects (All):

Hospitals--Finance.

Hospitals.

Physical Description:

1 online resource (20 pages).

Place of Publication:

Washington, DC : Congressional Research Service, the Library of Congress, [2007]

Summary:

The Medicaid statute requires that states make disproportionate share (DSH) adjustments to the payment rates of hospitals treating large numbers of low-income and Medicaid patients. This provision is intended to recognize the disadvantaged situation of those hospitals. Although the requirement was established in 1981, DSH payments did not become a significant part of the program until after 1989, when they grew from just under $1 billion to almost $17 billion by 1992. During that time, states' Medicaid budgets were facing a number of upward pressures while states were learning about financing techniques that made it easier to collect increased DSH payments from the federal government. In 1991, Congress intervened to control the growth of DSH payments by limiting the amounts available to each state and setting national limits. The law was successful. The rapid growth in DSH payments had been halted. In 2005, the most recent year for which data were available, total reported DSH payments were $17 billion.1 Today, a state's DSH payments cannot exceed an allotment amount, calculated based on a statutory formula, for that state. States must define, in their state Medicaid plan, hospitals qualifying as DSH hospitals and DSH payment formulas. DSH hospitals must include at least all hospitals meeting minimum criteria and may not include hospitals that have a Medicaid utilization rate below 1%. The DSH payment formula also must meet minimum criteria, and DSH payments for any specific hospital cannot exceed a hospital-specific cap based on the unreimbursed costs of providing hospital services to Medicaid and uninsured patients. DSH payments for mental hospitals cannot exceed an aggregate cap based on a percentage of such payments in 1995. However, within these broad guidelines, states also have a great deal of discretion in designating DSH hospitals and calculating adjustments for them. For this reason, Congress has required states to report the methods used to identify and pay DSH hospitals and the payments made to each of the identified hospitals. Annual state reporting, however, is not yet being routinely collected by the Centers on Medicare and Medicaid Services (CMS). Congress has intervened a number of times to change various features of the DSH allotments, sometimes to reduce payments below the levels provided for in the 1991 legislation and other times to provide additional allotment funds. Statutory changes are described in more detail below. 1 2005 CMS 64 data - Net reports.

Notes:

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