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Guidance on Supplemental Payments Reporting, Medicaid Shortfall Calculations

The Centers for Medicare & Medicaid Services (CMS) sent a letter to state Medicaid directors outlining new supplemental payment reporting and Medicaid disproportionate share hospital (DSH) requirements under the Consolidated Appropriations Act (CAA).

Supplemental Payment Reporting Requirements

CMS anticipates that states already have access to the information required for supplemental payment reporting and makes modifications to the Medicaid Budget and Expenditure System (MBES) to enable states to submit the new information. Once modified, the MBES will capture all narrative and quantitative data on the number of supplemental payments made to each provider under the state plan and demonstration authorities, including uncompensated care pool payments, delivery system reform incentive payments, and designated state health programs.

Reporting is expected on the expenditure report for the first quarter of fiscal year 2022.

Medicaid Shortfall Calculations

The CAA amended the methodology for calculating hospital-specific Medicaid DSH limits but made an exception to the change for hospitals in the 97th percentile for number of Medicare inpatient days for beneficiaries also eligible for supplemental security income benefits.

However, CMS states there is no readily available data to determine the application of this exception. CMS will develop a data source to meet this need and make it available to states. CMS intends to release guidance and engage in future rulemaking on this issue.

America’s Essential Hospitals is reviewing the letter and will send members a detailed Action Update in the coming days.

Contact Senior Director of Policy Erin O’Malley at or 202.585.0127 with questions.


About the Author

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

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