Becker's Hospital Review

23 CFO / FINANCE CMS Moves Forward With $43B in DSH Payment Cuts By Ayla Ellison C MS issued a proposed rule July 27 that lays out a methodology for implement- ing cuts to Medicaid Disproportion- ate Share Hospital allotments under the ACA beginning in fiscal year 2018. With the expectation of lower un- insured rates and lower levels of hospital uncompensated care, the ACA adjusted the amounts of fund- ing available to states under the Medicaid program for hospitals that serve a disproportionate share of low-income patients. The ACA calls for aggregate reductions to Medic- aid DSH payments annually from FY 2014 through FY 2020. Subsequent legislation delayed the start of the reductions until FY 2018 and pushed the end date back to FY 2025. Medicaid DSH allotments are slat- ed to be reduced by $2 billion in FY 2018. The reductions will grow by $1 billion per year through FY 2024, when payments will be cut by $8 bil- lion. DSH allotments will be reduced by another $8 billion in FY 2025. CMS proposed a methodology that would account for new data sourc- es, some of which were unavailable during prior rulemaking. Those sources include DSH Medicaid Inpa- tient Utilization Rate data, U.S. Cen- sus Bureau data and existing state DSH allotments. "We are proposing to utilize the most recent year avail- able for all data sources and are pro- posing to align data sources when- ever possible," said CMS. The proposed methodology would help ensure DSH payments reach hospitals with the most need for fi- nancial assistance due to high vol- umes of Medicaid inpatients and high levels of uncompensated care, according to CMS. n CMS Cancels Cardiac Bundles, Scales Back CJR Model: 8 Things to Know By Ayla Ellison C MS issued a proposed rule Aug. 15 that would cancel or scale back ma- jor bundled payment initiatives. Here are eight things to know about the proposed rule. 1. CMS sent a proposed rule to the Office of Management and Budget in early August. The title of the rule indicated CMS would cancel mandatory bundled payment initiatives for heart attacks, bypass surgery and hip and femur fractures. Details on the changes were revealed Aug. 15 when the proposed rule was made public. 2. The proposed rule would cancel the mandatory bundled payment program for heart attacks and bypass surgeries and the cardiac rehabilitation payment model, which is intended to test whether a payment incentive can increase the utilization of cardiac rehabilitative services. 3. The proposed rule would eliminate mandatory bundling for hip and femur frac- ture treatment under the Comprehensive Care for Joint Replacement program. 4. The cardiac bundles and the CJR expansion are slated to begin Jan. 1, 2018. 5. The proposed rule would scale back the existing CJR model. The CJR pro- gram would be mandatory for hospitals in 34 of the 67 geographic areas chosen for the program. The CJR model would continue on a voluntarily basis in the other 33 geographic areas. The proposed rule would also make participating in the CJR model voluntary for all low volume and rural hospitals in the 67 areas. 6. "Changing the scope of these models allows CMS to test and evaluate im- provements in care processes that will improve quality, reduce costs, and ease burdens on hospitals," said CMS Administrator Seema Verma. "Stakeholders have asked for more input on the design of these models. These changes make this possible and give CMS maximum flexibility to test other episode-based models that will bring about innovation and provide better care for Medicare beneficiaries." 7. Ashley Thompson, American Hospital Association senior vice president for public policy analysis and development, said the AHA is concerned cancellation of the bundled payment models could cause problems for provider organiza- tions that have spent valuable resources to implement these programs. 8. CMS will accept comments on the proposed rule until Oct. 16. n North Carolina Hospital to Close and Lay Off 76 Employees, Including Nurses By Ayla Ellison S elect Specialty Hospital-Winston-Salem (N.C.) will close Sept. 1, according to a Worker Adjustment Retraining and Notification Act notice filed July 3 by the hospital's owner, Mechanicsburg, Pa.-based Select Medical. According to the notice, the closure will result in 76 layoffs. The layoffs will affect many positions, including nurses, nursing assistants, physical therapists and oth- er support personnel, according to WXII. Select Specialty Hospital-Winston-Salem is part of Select Medical's network of more than 100 long-term acute care sites. Select Medical did not respond to a request for comment. n

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