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Medicaid DSH Third-Party Payer Litigation Concludes

In early October, the Supreme Court denied hospitals’ petition to hear an appeal in the Children’s Hospital Association of Texas (CHAT) v. Azar case.

With this denial, the D.C. Circuit’s decision upholding CMS’ third-party payer final rule will stand, allowing CMS to require the offset of third-party payments in calculating the hospital-specific DSH limit.

The only open question remaining is the effective date of the final rule. CMS indicated it will enforce the final rule as of its original effective date of June 2, 2017. The CHAT plaintiffs have asked the district court to delay the effective date to November 2019, when the D.C. Circuit’s decision took effect. The district court judge has not yet issued an opinion on the effective date.

Contact Senior Director of Policy Erin O’Malley at eomalley@essentialhospitals.org or 202.585.0127 with questions.

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About the Author

Abigail Painchaud is a policy associate at America's Essential Hospitals.

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