Will 2018 Bring New Hospital Funding?

By Ryan Kelly –

According to recent reports, CMS is proposing a $3 billion increase in payments to inpatient hospitals beginning in 2018.

Long promoted by groups like the MRHA and NRHA, increase funding for hospitals is critical in order to properly support the struggling safety net in our rural areas.

Along with increased payments, CMS is also looking to alter the funding formulas.  The Medicare Payment Advisory Commission suggested the idea of changing these formulas, saying the change would distribute the funds in a more equitable fashion.

According to ModernHealthcare, ‘the agency will distribute roughly $7 billion in uncompensated care funds in fiscal year 2018. That’s a bump of approximately $1 billion from the prior year. This change reflects the CMS’ proposal to use new data to estimate the rate of uninsurance which calculates the total amount of uncompensated care payments available.’

Safety net hospitals would also see a change in the way they receive DSH payments (disproportionate-share payments). The new formula will lean mostly on the amounts of uncompensated care and charitable care each hospital claims on its Medicare cost report. The current formula uses a formula based on the number of Medicaid, dual-eligible and disabled patients each hospital served.

I have not yet calculated what impact this would make in Mississippi for our facilities, but it is believed that the change would disproportionately benefit non-Medicaid expansive states like ours.  If we receive new data on this proposed change, we will be sure to send it out soon.  For now, though, this appears to be good news for our rural hospitals.

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