New CMS Ruling on DSH Appeals for FY 2004 and Earlier

It’s a measure of the backlog in DSH (for Disproportionate Share Hospital) payment appeals that CMS is still issuing rulings for appeals applicable to treatment of patients before October 1, 2004. On April 24 CMS issued Ruling No. CMS-1498-R2, addressing the nettlesome issue of how to treat certain “dual-eligibles”—patients who are eligible for both Medicare and Medicaid but who have exhausted their Medicare benefits.

According to the ruling, a hospital can elect either to (a) include all dual-eligible patient days, regardless of Medicare exhaustion, counted in both the numerator and denominator of the Medicare fraction of the DSH payment or (b) exclude all Medicare-exhausted patient days from both the numerator and the denominator of the fraction.

It may sound like inside baseball, but the amounts of money at stake can be enormous.  Those hospitals with pending DSH appeals for fiscal 2004 and earlier will find it well worthwhile to do the math.

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