Southwest Consulting Associates Blog

Uncompensated Care Reimbursement: Meet Your Milestones

Posted by Cory Aubuchon on Oct 31, 2014 2:26:00 PM

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In today’s DSH/Uncompensated Care (UC)

reimbursement world, Medicaid

Medicare DSH Uncompensated Care reimbursement milestones
days still play a key role in driving a hospital’s reimbursement.  The accuracy and volume of reported Medicaid days have always been a driving factor in DSH reimbursement.  A third element, timing, is now a critical component in realizing all entitled DSH/UC reimbursement.

In the past, hospitals reported Medicaid days on their as-filed cost report and typically revised their Medicaid days upon secondary/tertiary review to pick up retroactive eligibility determinations and additional DSH reimbursement.  The revised days were usually settled by the MAC via audit, reopening or appeal.

Under the new DSH/UC formula and current regulatory environment, that process is not a “best practice”. Hospitals will continue to realize the benefit of additional Medicaid days for their 25% empirically justified DSH reimbursement, however, the UC piece will only use Medicaid days based on the following timeline to calculate Factor 3:

Federal FY Medicaid Days FFY HCRIS Deadline
2014 2010/2011 Q1 2013
2015 2011/2012 Q1 2014
2016 2012/2013 Q1 2015*


*assumes low income days (Medicaid + SSI) continue to be used for Factor 3

Hospitals are now under pressure to meet accelerated reporting deadlines in order to have a meaningful impact on Factor 3.  The best course of action is to devote resources to the as-filed cost report.  Any Medicaid days omitted from the as-filed cost report are at risk from being excluded from the pending Factor 3 calculation, thus resulting in lost reimbursement.

Here is a simulation of the Medicaid days time crunch:

Hospital FYE:  6/30/14 (FFY 2013)
As-filed Cost Report Due:  11/30/14
HCRIS Deadline:  3/31/15

The hospital in this simulation has only 4 months after cost report filing to identify all additional Medicaid days, amend the cost report, pursue MAC acceptance and have the accepted cost report transmitted to CMS for inclusion in the Q1 2015 HCRIS file.

Under the new DSH/UC reimbursement formula, hospitals have another reason to be good stewards of the Medicaid days reported on their as-filed cost report or risk losing reimbursement. Hospitals should plot out the key milestone dates (based on their FYE) for amending the cost report and work diligently with the MAC to meet appropriate filing deadlines in order to optimize reimbursement.

If you would like to discuss your particular situation and filing strategy with a professional at SCA please do not hesitate to contact us - we would be happy to assist in any way that we can.

Topics: Medicare DSH Reimbursement, uncompensated care

About This Blog

The climate of provider reimbursement is ever-changing and this blog is intended to keep you up-to-date on the latest information regarding:

  • DSH Reimbursement
  • 340B Pharmacy Drug Discount Program
  • Compliance Issues
  • Litigation Surrounding Provider Reimbursement

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