The Centers for Medicare and Medicaid Services has appealed a court ruling preventing CMS from enforcing in Missouri a final rule that takes into consideration private insurance or Medicare reimbursement in calculating the payment limit for disproportionate share hospitals, according to the American Hospital Association.
CMS filed the April 10 appeal in a case brought by the Missouri Hospital Association against the agency and the Department of Health and Human Services. In February, U.S. District Court Judge Brian Wimes in Missouri ruled in favor of the MHA.
The federal decision has national implications, as a federal court in Washington, D.C. voided the final rule, saying it no longer applied nationally.
CMS had until May 7 to appeal, according to the AHA.
CMS pays disproportionate share hospitals funds based on a finite pool of federal money in each state. The money is used to help cover the cost of providing care to uninsured patients, as the providers serve a significantly disproportionate number of low-income patients.
In a final rule, effective in June 2017, CMS said private insurance and Medicare payments would be included when calculating the limit on DSH payments. The hospital-specific limit calculation would reflect only the cost for which the hospital had not received payment from another source, CMS said.
Incorporated into the rule was a policy that CMS's online responses to frequently asked questions would be used in the hospital specific limit calculation.
The federal court in Missouri said that while states have the discretion to determine how to implement the DSH program provisions, Congress has set certain statutory limitations.
The judge concluded that the law is unambiguous in that the calculation of a DSH hospital's specific limit does not involve consideration of private insurance or Medicare payments. A DSH hospital's total uncompensated costs of care for calculating the hospital specific limit is reduced only by the total of other Medicaid program payments, Wimes said.
"In the Court's view, the language of (the law) is unambiguous on how states should calculate HSL under the DSH program," Judge Wimes said. "The court agrees with the MHA that the unambiguous language of the statute explains the only payments that offset a hospital's Medicaid costs are non-DSH Medicaid payments."
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Email the writer: susan.morse@himssmedia.com