Roth Applauds Administration's Swift Response to Request for Adjustment for Disproportionate Share Hospitals
WASHINGTON -- Senate Finance Committee Chairman William V. Roth, Jr. (R-DE) today released the following statement on the Administration's decision to make Chairman Roth's recommended adjustments to the disproportionate share hospital "DSH" payment system. Administrative action will be taken to forgive Pennsylvania and other potentially impacted states for its outstanding Medicare DSH disallowances. Because of confusion and lack of clarity in guidance, hospitals will be held harmless. Health and Human Services will be clarifying guidance, with application of new guidance policies after January 1, 2000.
"I am delighted that the Administration responded so quickly to the second letter that Senator Moynihan and I sent yesterday requesting administrative changes to Medicare," Roth stated.
"Under current law, Medicare disproportionate share hospital "DSH" payments are distributed among eligible hospitals through a formula-based percentage adjustment to the basic inpatient payment rate. The add-on factor for each case represents a hospital's percentage, or share, of low income patients and is set by the sum of two ratios: (1) Medicaid patient days as a share of total patient days, and (2) patient days for Medicare beneficiaries who are eligible for Supplemental Security Income "SSI" as a share of total Medicare patient days.
"Senator Moynihan and I requested changes because it had very recently come to the Committee's attention that a limited number of states may have been reporting allowable Medicare DSH days in a manner that may be inconsistent with HCFA's administrative interpretation. The misreporting, if it occurred, was due to ambiguous or incorrect guidance provided by Medicare fiscal intermediaries related to the inclusion of state general assistance programs in DSH calculations. HCFA's fiscal intermediaries have begun the process of recouping alleged overpayments. The committee has made no determination of the appropriateness of such recoupment. However, because of the lack of certainty over the direction given to the states when they were establishing their DSH methodologies, and because of the potentially severe impact on individual hospitals, the Committee proposal intends to create a window of opportunity for HCFA, the impacted states, and affected hospitals to reach a resolution on the question of overpayments and recovery, if any.
"Senator Moynihan and I made provisions in the Balanced Budget Adjustment Act of 1999 proposal released this week to make these DSH adjustments. We will now be able to redirect a modest amount of funds to other critical areas.
"I look forward to receiving the Administration's response to our request for administrative adjustments to be made to hospital outpatient departments, Medicare + Choice risk adjustment and skilled nursing facilities."
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