The disproportionate-share hospital (DSH) supplemental payment program is designed to provide additional funding to hospitals that serve a disproportionate number of Medi-Cal and low-income/charity patients. This federally mandated program compensates DSH providers for their unrecovered costs of caring for Medicaid and other indigent patients. In California, the DSH program is administered by the Department of Health Care Services (DHCS), which annually determines eligibility. DSH payments to hospitals are determined by many variables.
CHA President/CEO C. Duane Dauner was joined by 10 representatives of CHA member hospitals in Washington, D.C., Dec. 3 for the CHA and American Hospital Association hospital advocacy day. The group met with about half of the California Congressional delegation, including House Minority Leader Nancy Pelosi, House Majority Whip Kevin McCarthy, and Sens. Boxer and Feinstein.
The Centers for Medicare & Medicaid Services (CMS) has posted the final rule implementing the provision of the Affordable Care Act that reduces Medicaid state disproportionate share hospital (DSH) allotments. CHA is currently reviewing the final provisions and will share more information and a detailed summary soon. The final rule adopts a proposal to ignore states’ decisions on the now-optional Medicaid expansion over the next two years when calculating DSH reductions, totaling $1.1 billion. According to a CMS fact sheet about the final rule, states’ decisions to expand Medicaid will not affect the reduction in DSH allotments. CMS states that it intends to revisit the DSH allotment reduction methodology in federal fiscal year 2016. The final rule is attached.