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CMS Publishes Medicaid DSH Calculation Exception Lists

The Centers for Medicare & Medicaid Services (CMS) released the lists of hospitals qualifying for the 97th percentile exception regarding a hospital’s Medicaid disproportionate share hospital (DSH) limit.

In February, CMS published the final rule for Section 203 of the Consolidated Appropriations Act, 2021 (CAA), which changes how the calculation of a hospital’s Medicaid DSH uncompensated care limit accounts for costs and payments related to Medicare and other dually eligible patients.

The CAA made an exception for hospitals at or above the 97th percentile for all hospitals with respect to either of two measures, based on the most recent cost reporting period:

Percentage of total inpatient days for patients entitled to Medicare Part A and supplemental security income benefits.
Number of inpatient days for such patients.

Hospitals qualifying for the 97th percentile exception will have a DSH limit equal to the higher of the limit prescribed in Section 203 or the previous regulatory limit, which included costs and payments for dually eligible patients.

CMS published exception lists for three effective dates:

Hospitals’ status on the lists could change annually based on new data.

Contact Director of Policy Rob Nelb, MPH, at rnelb@essentialhospitals.org or 202.585.0127 with questions.

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About the Author

Julie Kozminski is a policy manager at America's Essential Hospitals.

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