CHA News Article

Fiscal Year 2016-17 Outlier Recalculation Policy Now Available

The Department of Health Care Services has established an outlier recalculation policy for hospitals reimbursed under the All Patient Refined Diagnosis-Related Group (APR-DRG) for claims with dates of service in state fiscal year 2016-17 (July 1, 2016, through June 30, 2017). The policy applies to hospitals receiving aggregate APR-DRG outlier payments of at least $500,000 annually, which will be prorated based on the hospital’s fiscal year end cost report submission. The department will perform cost report audits to determine the audited cost-to-charge ratios, which may result in the inclusion of additional hospitals in the outlier recalculation policy. If the difference between the reported ratio and the final audited ratio results in an outlier payment adjustment exceeding $10,000 in a hospital’s fiscal year, the outlier payments may be recalculated based on the audited ratio. The outlier reconciliation may occur through the recoupment of funds or through an additional payment made to the hospital. For further information or for help with questions about this policy, providers should contact drg@dhcs.ca.gov.

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