42 C.F.R. § 447.294
(b) Definitions. For purposes of this section—
Aggregate DSH allotment reductions mean the amounts identified in section 1923(f)(7)(A)(ii) of the Act.
Budget neutrality factor (BNF) is a factor incorporated in the DHRM that takes into account the extent to which the DSH allotment for a State was included in the budget neutrality calculation for a coverage expansion approved under section 1115 as of July 31, 2009.
DSH payment means the amount reported in accordance with § 447.299(c)(17).
Effective DSH allotment means the amount of DSH allotment determined by subtracting the State-specific DSH allotment reduction from a State's unreduced DSH allotment.
High level of uncompensated care factor (HUF) is a factor incorporated in the DHRM that results in larger percentage DSH allotment reduction for States that do not target DSH payments on hospitals with high levels of uncompensated care.
High Medicaid volume hospital means a disproportionate share hospital that has an MIUR at least one standard deviation above the mean MIUR for hospitals receiving Medicaid payments in the State.
High uncompensated care hospital means a hospital that exceeds the mean ratio of uncompensated care costs to total Medicaid and uninsured inpatient and outpatient hospital service costs for all disproportionate share hospitals within a state.
High volume of Medicaid inpatients factor (HMF) is a factor incorporated in the DHRM that results in larger percentage DSH allotment reduction for States that do not target DSH payments on hospitals with high volumes of Medicaid inpatients.
Hospital with high volumes of Medicaid inpatients means a disproportionate share hospital that meets the requirements of section 1923(b)(1)(A) of the Act.
Low DSH adjustment factor (LDF) is a factor incorporated in the DHRM that results in a smaller percentage DSH allotment reduction on low DSH States.
Low DSH State means a State that meets the criterion described in section 1923(f)(5)(B) of the Act.
Mean HUF reduction percentage is determined by calculating the quotient of each state's HUF reduction amount divided by its unreduced DSH allotment, then calculating the mean for each state group, then converting the result to a percentage.
Medicaid inpatient utilization rate (MIUR) means the rate defined in section 1923(b)(2) of the Act.
Non-high Medicaid volume hospital means a disproportionate share hospitals that does not meet the requirements of section 1923(b)(1)(A) of the Act.
State group means similarly situated States that are collectively identified by DHRM as defined in § 447.294(e)(1).
State-specific DSH allotment reduction means the amount of annual DSH allotment reduction for a particular State as determined by the DHRM.
Total hospital cost has the meaning given the term in § 447.299(c)(20).
Total Medicaid cost means the amount for each hospital reported in accordance with § 447.299(c)(10).
Total population means the 1-year estimates data of the total non-institutionalized population identified by United States Census Bureau's American Community Survey.
Total uninsured cost means the amount reported for each DSH in accordance with § 447.299(c)(14).
Uncompensated care cost means the amount reported for each hospital in accordance with § 447.299(c)(16).
Uncompensated care level means a hospital's uncompensated care cost divided by the sum of its total Medicaid cost and its total uninsured cost.
Unreduced DSH allotment means the DSH allotment calculated under section 1923(f) of the Act prior to annual reductions under this section.
Uninsured percentage factor (UPF) is a factor incorporated in the DHRM that results in larger percentage DSH allotment reductions for States that have the lowest percentages of uninsured individuals.
Uninsured population means 1-year estimates data of the number of uninsured identified by United States Census Bureau's American Community Survey.
(e) DHRM methodology. Section 1923(f)(7) of the Act requires aggregate annual reduction amounts as specified in paragraph (f) of this section to be reduced through the DHRM. The DHRM is calculated on an annual basis based on the most recent data available to CMS at the time of the calculation. The DHRM is determined as follows:
(2) Aggregate DSH allotment reduction allocation. CMS will allocate a portion of the aggregate DSH allotment reductions to each State group by the following:
(3) Low DSH adjustment factor (LDF) calculation. CMS will calculate the LDF by the following:
(4) LDF application. CMS will determine the final aggregate DSH allotment reduction allocation for each State group through application of the LDF by the following:
(5) Reduction factor allocation. CMS will allocate the aggregate DSH allotment reduction amount to three core factors by multiply the aggregate DSH allotment reduction amount for each State group by the following:
(6) Uninsured percentage factor (UPF) calculation. CMS will calculate the UPF by the following:
(12) Section 1115 budget neutrality factor (BNF) calculation. This factor is only calculated for States for which all or a portion of the DSH allotment was included in the calculation of budget neutrality under a section 1115 demonstration in accordance with an approval on or before July 31, 2009. CMS will calculate the BNF for qualifying States by the following:
(14) State-specific DSH allotment reduction calculation. CMS will calculate the state-specific DSH reduction by the following:
[78 FR 57311, Sept. 18, 2013, as amended at 84 FR 50332, Sept. 25, 2019; 89 FR 13945, Feb. 23, 2024]