CMS has published a final rule intended to codify its existing interpretation of how third-party payments are considered in the calculation of Medicaid uncompensated care costs for the purpose of making Medicaid disproportionate share hospital (DSH) payments. Under the final rule, CMS specifies that uncompensated care costs for purposes of calculating hospital-specific DSH limits are costs net of third-party payments received, including but not limited to payments from Medicare or private insurance. CMS does not anticipate that the rule will have a significant financial impact on states or providers since it does not represent a change in policy. The rule is effective June 2, 2017.
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