Advocacy Alert

Urge Your Lawmakers to Support Essential Health System Designation

Association Comments on Proposed Medicare DSH Payment Rule

Faridat Animashaun
May 2, 2023

In a letter to the Centers for Medicare & Medicaid Services (CMS), America’s Essential Hospitals commented on proposed changes for counting certain days associated with Medicaid Section 1115 demonstrations in the Medicare disproportionate share hospital (DSH) calculation.

The association urged CMS to withdraw its proposal to exclude patient days related to uncompensated care (UC) pools from the Medicaid fraction of the Medicare DSH calculation. The association expressed concerns that CMS’ proposal to exclude patient days related to UC pools and other types of funding pools authorized by Section 1115 waivers are contrary to the Medicare statue. The proposal would decrease DSH payments to essential hospitals not only in states with UC pools but also in states without UC pools, further affecting their ability to serve their communities and promote health equity.

Additionally, America’s Essential Hospitals expressed support for CMS’ decision to include in the Medicaid fraction days for patients receiving premium assistance through Section 1115 waivers. The association encouraged CMS to finalize this proposal and provide clarification to avoid unnecessary confusion about which states’ premium assistance waivers would qualify under the proposal.

Contact Director of Policy Rob Nelb, MPH, at or 202.585.0127 with questions.

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