PURPOSE: This rule implements a new state methodology for paying Disproportionate Share Hospital (DSH) payments in order to comply with the new federally-required DSH audit standards. The regulation provides for an interim adjustment to DSH payments and provides for final adjustment to DSH payments based upon the federally-mandated DSH audits.

PUBLISHER’S NOTE: The secretary of state has determined that the publication of the entire text of the material which is incorporated by reference as a portion of this rule would be unduly cumbersome or expensive. This material as incorporated by reference in this rule shall be maintained by the agency at its headquarters and shall be made available to the public for inspection and copying at no more than the actual cost of reproduction. This note applies only to the reference material. The entire text of the rule is printed here.

1. (1) General Reimbursement Principles.

   1. (A) In order to receive federal financial participation (FFP), disproportionate share payments are made in compliance with federal statutes and regulations. Section 1923 of the Social Security Care Act (42 U.S. Code) describes the hospitals that must be paid DSH payments and those that the state may elect to pay DSH payments.

   2. (B) Hospitals that must be paid DSH payments are considered to be federally-deemed disproportionate share hospitals. The state must pay DSH payments to hospitals that meet the following criteria:

      1. 1. Obstestrics requirements as described

in paragraph (2)(A)1.; and

1. 2. Have a Medicaid Inpatient Utilization

Rate (MIUR) at least one (1) standard deviation above the statewide mean as defined in paragraph (2)(A)2., or a Low Income Utilization Rate (LIUR) greater than twentyfive percent (25%) as defined in paragraph (2)(A)3.

1. (C) Hospitals that may be paid DSH must meet obstetric requirements as defined in paragraph (2)(A)1. and have a MIUR of at least one percent (1%).
2. (D) Section 1923(g) of the Social Security Act (Act) limits the amount of DSH payments states can pay to each hospital and earn FFP. To be in compliance with the Act, DSH payments shall not exceed one hundred percent (100%) of the uncompensated care costs of providing hospital services to Medicaid and uninsured individuals. Hospital-specific DSH limit calculations must comply with the federal DSH rules (42 CFR 447, Subpart E and 42 CFR 455, Subpart D). If the disproportionate share payments exceed the hospitalspecific DSH limit, the difference shall be deducted from disproportionate share payments or recouped from future payments.
3. (E) All DSH payments in the aggregate shall not exceed the federal DSH allotment within a state fiscal period. The DSH allotment is the maximum amount of DSH payments a state can distribute each year and receive FFP.
4. (F) The state must submit an annual independent audit of the state’s DSH program to the Centers for Medicare and Medicaid Services (CMS). FFP is not available for DSH payments that are found to exceed the hospital-specific eligible uncompensated care cost limit. All hospitals that receive DSH payments are subject to the independent federal DSH audit.
5. (G) Hospitals qualify for DSH for a period of one (1) state fiscal year and must requalify at the beginning of each state fiscal year to continue to receive disproportionate share payments.

1. (2) Federally-Deemed DSH Hospitals.

   1. (A) The state must pay disproportionate share payments to hospitals that meet specific obstetric requirements and have either a MIUR at least one (1) standard deviation above the state mean or a LIUR greater than twenty-five percent (25%).

      1. 1. Obstetric requirements and exemp-

tions.

1. A. Hospitals must have two (2) obste-

tricians, with staff privileges, who agree to provide non-emergency obstetric services to Medicaid eligibles. Rural hospitals, as defined by the federal Executive Office of Management and Budget, may qualify any physician with staff privileges as an obstetrician.

1. B. Hospitals are exempt from the

obstetric requirements if the facility did not offer non-emergency obstetric services as of December 21, 1987.

1. C. Hospitals are exempt if inpatients

are predominantly under eighteen (18) years of age.

1. 2. MIUR calculations.

   1. A. As determined from the fourth

prior year desk-reviewed cost report, the facility has a MIUR of at least one (1) standard deviation above the state’s mean MIUR for all Missouri hospitals.

1. B. The MIUR is calculated as follows:

   1. (I) The MIUR will be expressed as

the ratio of total Medicaid days (TMD) provided under a state plan divided by the provider’s total number of inpatient days (TNID).

1. (II) The state’s mean MIUR will be

expressed as the ratio of the sum of the total number of the Medicaid days for all Missouri hospitals divided by the sum of the total patient days for the same Missouri hospitals. Data for hospitals no longer participating in the program will be excluded.

TMD

MIUR = TNID

1. 3. LIUR calculations.

   1. A. As determined from the fourth

prior year desk-reviewed cost report, the LIUR shall be the sum (expressed as a per- 13 CSR 70-15

centage) of the fractions, calculated as follows:

1. (I) Total MO HealthNet patient rev-

enues (TMPR) paid to the hospital for patient services under a state plan plus the amount of the cash subsidies (CS) directly received from state and local governments, divided by the total net revenues (TNR) (charges, minus contractual allowances, discounts, and the like) for patient services plus the CS; and

1. (II) The total amount of the hospi-

tal’s charges for patient services attributable to charity care (CC) (care provided to individuals who have no source of payment, third-party, or personal resources) less CS directly received from state and local governments in the same period, divided by the total amount of the hospital’s charges (THC) for patient services. The total patient charges attributed to CC shall not include any contractual allowances and discounts other than for indigent patients not eligible for MO HealthNet under a state plan.

TMPR + CS CC − CS

LIUR = + TNR + CS THC

1. (3) State-Elected DSH Payments.

   1. (A) The state may elect to make hospital disproportionate share payments to hospitals that meet the obstetric requirements defined in paragraph (2)(A)1. and have a MIUR of at least one percent (1%) as calculated in subparagraph (2)(A)2.B.

2. (4) DSH Payment Adjustments.

   1. (A) Beginning in Medicaid state plan year 2011, DSH payments made to hospitals will be revised based on the results of a 2011 state DSH survey. The revisions based on the 2011 state DSH survey will ensure state fiscal year

3. (SFY) 2011 DSH payments are eligible for FFP through compliance with the federal DSH rules. These revisions are to serve as interim adjustments until the federally-mandated annual independent DSH audits are complete. Annual independent DSH audits are finalized three (3) years following the SFY year-end reflected in the audit. For example, the SFY 2011 DSH audit will be finalized in 2014. The interim adjustments shall be determined as follows:

   1. 1. 2011 estimated hospital-specific DSH

limits were determined based upon the state’s calculations using data provided in the 2011 state DSH survey, SFY 2011 Medicaid supplemental payments maintained by MHD, and data provided in the final 2007 independent DSH audit, if applicable. DSH payments will be limited to the hospital’s estimated hospital-specific DSH limit. The state’s calculations will be based on 2011 state DSH surveys received by MO HealthNet as of May 31, 2011. However, a corrected survey may be accepted if it is supported by documentation and the state determines the correction is appropriate and has a material impact on the survey results. The state’s calculations are set forth below—

1. A. The 2011 estimated hospital-spe-

cific DSH limit is calculated as follows:

1. (I) 2011 estimated Medicaid net

cost from the 2011 state DSH survey.

1. (II) Less actual SFY 2011

Medicaid supplemental payments.

1. (III) Equals 2011 estimated

Medicaid uncompensated care cost.

1. (IV) Plus 2011 estimated uninsured

uncompensated care cost from the 2011 state DSH survey.

1. (V) Equals 2011 estimated hospi-

tal-specific DSH limit;

1. B. The total 2011 estimated long-

fall/shortfall for each hospital is calculated as follows:

1. (I) 2011 estimated hospital-specific

DSH limit.

1. (II) Less DSH payments paid by

MHD during SFY 2011.

1. (III) Less out-of-state DSH pay-

ments received by the hospital during SFY 2011.

1. (IV) Equals total 2011 estimated

longfall/shortfall;

1. C. The total 2011 estimated hospital

DSH liability is an overpayment subject to recoupment which will be the SFY 2011 interim DSH payment adjustment for hospitals with an estimated longfall. The total 2011 estimated hospital DSH liability is the lessor of the—

1. (I) The 2011 estimated longfall; or
2. (II) DSH payments paid during

SFY 2011;

1. D. Hospitals that merge their opera-

tions under one (1) Medicare and MO HealthNet provider number shall have their SFY 2011 DSH payments adjusted based on combining the results of the 2011 state DSH surveys prorated monthly for the time period the merger was effective. If a 2011 estimated DSH liability is identified, the surviving hospital assumes the responsibility for the overpayment. The calculation for combining and prorating the 2011 state DSH surveys is set forth below—

1. (I) The estimated hospital DSH lia-

bility prior to the merger shall be calculated as follows:

1. (a) The calculations set forth in

subparagraphs (4)(A)1.A., (4)(A)1.B., and (4)(A)1.C. will be calculated based on each separate hospital’s 2011 state DSH survey, prorated monthly for the time period prior to the merger;

1. (II) The estimated hospital DSH

liability beginning with the month the merger is effective shall be calculated as follows:

1. (a) The 2011 state DSH surveys

for each hospital shall be added together to yield a combined 2011 state DSH survey and prorated monthly for the time period the merger was effective. The calculations set forth in subparagraphs (4)(A)1.A., (4)(A)1.B., and (4)(A)1.C. will be calculated for the combined 2011 state DSH survey;

1. (III) The total estimated hospital

DSH liability for the merged entity will be the sum of the amounts determined in part (4)(A)1.D.(I) for each hospital plus the combined amount determined in part (4)(A)1.D.(II); and

1. E. Facilities not providing a 2011 state

DSH survey shall have their SFY 2011 DSH payments revised using the most recent hospital-specific information provided to the state by the independent DSH auditor trended to the applicable SFY using the trend factor published in Health Care Costs by DRI/McGraw- Hill and listed in 13 CSR 70-15.010. A facility that was not included in the most recent hospital-specific information provided to the state by the independent DSH auditor shall have their entire SFY 2011 DSH payment recouped.

1. 2. DSH payments paid during SFY 2011

that exceed the 2011 estimated hospital-specific DSH limits will be recouped from the hospitals to reduce their payments to their 2011 estimated hospital-specific DSH limit.

1. 3. The amount of SFY 2011 DSH pay-

ments to be recouped from a hospital by the MO HealthNet Division will be limited in each state fiscal year to two percent (2%) of the hospital’s taxable revenue set forth as follows. For recoupments made during SFY 2012 the recoupment amount will be limited to two percent (2%) of the hospital’s SFY 2011 taxable revenue. Any balance remaining to be recouped during SFY 2013 will be limited to two percent (2%) of the hospital’s SFY 2012 taxable revenue. Any balance remaining to be recouped will be incorporated in the final DSH adjustment, if applicable. The limitation on recoupment of DSH payments shall only apply to recoupments determined in accordance with section (4). No limitation on the recoupment of DSH payments shall apply if the hospital DSH liability is determined as a result of the final annual independent DSH audit set forth in section (7).

1. (B) Any payments that are recouped from hospitals as a result of the state’s calculation in subsection (4)(A) will be redistributed to hospitals that are shown to have been paid less than their 2011 estimated hospital-specific DSH limits (i.e., estimated shortfall). These redistributions will occur proportionally based on each hospital’s 2011 estimated shortfall to the total 2011 estimated shortfall, not to exceed each hospital’s 2011 estimated hospital-specific DSH limit.

   1. 1. Redistribution payments to hospitals

that have been paid less than their 2011 estimated hospital-specific DSH limit must occur after the recoupment of payments made to hospitals that have been paid in excess of their 2011 estimated hospital-specific DSH limits. The state may establish a hospital-specific recoupment plan. However, total industry redistribution payments may not exceed total industry recoupments collected to date.

1. 2. If the Medicaid program’s original

DSH payments did not fully expend the federal DSH allotment for any plan year, the remaining DSH allotment may be paid to hospitals that are under their estimated hospitalspecific DSH limit. These payments will occur proportionally based on each hospital’s estimated shortfall to the total estimated shortfall, not to exceed each hospital’s estimated hospital-specific DSH limit.

1. (5) Disproportionate Share Hospital (DSH) Interim Payments.

   1. (A) Beginning with SFY 2012, interim DSH payments shall be calculated on an annual basis as set forth below.

      1. 1. SFY 2012 interim DSH payments will

be based on the state’s calculations using data provided in the 2011 state DSH survey after applying the trend factor published in Health Care Costs by DRI/McGraw-Hill for the current fiscal year, estimated SFY 2012 Medicaid supplemental payments calculated by MHD in accordance with 13 CSR 70-15.010, and data provided in the final 2007 independent DSH audit, if applicable.

1. 2. Beginning with SFY 2013, interim

DSH payments will be based on the state’s calculations using data provided in the state DSH survey for the applicable SFY, estimated Medicaid supplemental payments calculated by MHD in accordance with 13 CSR 70- 15.010 for the applicable SFY, and data provided in the most recent final independent DSH audit, if applicable.

1. (B) The interim DSH payments will be calculated as follows:

   1. 1. The estimated hospital-specific DSH

limit is calculated as follows:

1. A. Estimated Medicaid net cost from

the state DSH survey.

1. B. Less estimated Medicaid supple-

mental payments calculated by MHD in accordance with 13 CSR 70-15.010.

1. C. Equals estimated Medicaid un-

compensated care cost.

1. D. Plus estimated uninsured uncom-

pensated care cost from the state DSH survey.

1. E. Equals estimated hospital-specific

DSH limit.

1. 2. The estimated uncompensated care

costs potentially eligible for MHD interim DSH payments excludes out-of-state DSH payments and is calculated as follows:

1. A. Estimated hospital-specific DSH

limit.

1. B. Less estimated out-of-state (OOS)

DSH payments.

1. C. Equals estimated uncompensated

care cost (UCC) net of OOS DSH payments.

1. 3. Hospitals determined to have a nega-

tive estimated UCC net of OOS DSH payments (payments exceed costs) will not receive interim DSH payments because they are expected to exceed their estimated hospital-specific DSH limit unless they meet the requirement in subsection (5)(C).

1. 4. Qualified DSH hospitals determined

to have a positive estimated UCC net of OOS DSH payments (costs exceed payments) and hospitals that meet the requirements of subsection (5)(C) will receive interim DSH payments. The interim DSH payments are subject to the federal DSH allotment and the estimated hospital-specific DSH limits. The interim DSH payments will be calculated as follows:

1. A. Interim DSH payments to quali-

fied DSH hospitals determined to have a positive estimated UCC net of OOS DSH payments will be calculated as follows:

1. (I) Up to one-hundred percent

(100%) of the available federal DSH allotment will be allocated based on each hospital’s positive estimated UCC net of OOS DSH payments to the total positive estimated UCC net of OOS DSH payments; and

1. (II) The allocated amount will then

be reduced by one percent (1%) for hospitals that do not contribute through a plan that is approved by the director of the Department of Health and Senior Services to support the state’s poison control center and the Primary Care Resource Initiative for Missouri (PRIMO) and Patient Safety Initiative; and

1. B. Interim DSH payments to federal-

ly-deemed hospitals are set forth in subsection (5)(C).

1. (C) Federally-deemed hospitals will receive the nominal DSH payment of five thousand dollars ($5,000) and the greater of their upper payment limit payment or their estimated interim DSH payment as calculated above in subsection (5)(B). Except for federally-deemed hospitals, hospitals may elect to receive an upper payment limit payment as defined in 13 CSR 70-15.230 in lieu of DSH payments.
2. (D) Disproportionate share payments will coincide with the semimonthly claim payment schedule with the exception of the federally-deemed hospitals who will be paid the nominal DSH payment of five thousand dollars ($5,000) at the end of the SFY.

3. (E) New facilities will be paid based on the industry average estimated interim DSH payment as determined from subsection (5)(B) calculated as follows:

   1. 1. Hospitals receiving interim DSH pay-

ments shall be divided into quartiles based on total beds;

1. 2. DSH payments shall be individually

summed by quartile and then divided by the total beds in the quartile to yield an average interim DSH payment per bed; and

1. 3. The number of beds for the new facil-

ity shall be multiplied by the average DSH payment per bed.

1. (F) Facilities not providing a state DSH survey for the applicable SFY will have interim DSH payments calculated using the most recent hospital-specific information provided to the state by the independent DSH auditor trended to the applicable SFY using the trend factor published in Health Care Costs by DRI/McGraw-Hill and listed in 13 CSR 70- 15.010. A facility that was not included in the most recent hospital-specific information provided to the state by the independent DSH auditor shall not receive DSH payments for that SFY.

2. (G) Interim DSH Payments for Hospital Mergers.

   1. 1. Hospitals that merge prior to the

beginning of the SFY. Hospitals that merge their operations under one (1) Medicare and MO HealthNet provider number shall have their interim DSH payment determined based on adding each hospital’s state DSH survey to yield a combined state DSH survey and applying the same calculations in subsection (5)(B).

1. 2. Hospitals that merge after the begin-

ning of the SFY. The interim DSH payments that have been determined separately for the hospitals will be added together and paid to the surviving hospital effective with the approval date of the merger.

1. (H) If the Medicaid program’s original interim DSH payments did not fully expend the federal DSH allotment for any plan year, the remaining DSH allotment may be paid to hospitals that are under their estimated hospital-specific DSH limit. These payments will occur proportionally based on each hospital’s 13 CSR 70-15

estimated shortfall to the total estimated shortfall, not to exceed each hospital’s estimated hospital-specific DSH limit.

1. (6) Department of Mental Health Hospital

2. (DMH) DSH Adjustments and Payments.

   1. (A) Effective June 1, 2011, interim DSH payments made to DMH hospitals will be revised based on the results of a DMH state DSH survey which uses federally-mandated DSH audit standards. These revisions are to serve as interim adjustments until the federally-mandated DSH audits are complete in 2014.
   2. (B) Beginning in SFY 2012, due to structural changes occurring at the DMH facilities, interim DSH payments will be based on the third prior base year cost report trended to the current SFY adjusted for the federal reimbursement allowance (FRA) assessment paid by DMH hospitals. Additional adjustments may be done based on the results of the federally-mandated DSH audits as set forth below in subsection (7)(A).
   3. (C) If the Medicaid program’s original DSH payments did not fully expend the federal Institute for Mental Disease (IMD) DSH allotment for any plan year, the remaining IMD DSH allotment may be paid to hospitals that are under their projected hospital-specific DSH limit.

3. (7) Final DSH Adjustments.

   1. (A) Final DSH adjustments will be made after actual cost data is available and the annual independent DSH audit is completed. Annual independent DSH audits are completed three (3) years following the state fiscal year-end reflected in the audit. For example, final DSH adjustments for SFY 2011 DSH payments will be made following the completion of the annual independent DSH audit in 2014 (SFY 2015).

   2. (B) Final DSH adjustments may result in a recoupment for some hospitals and additional DSH payments for other hospitals based on the results of the annual independent DSH audit as set forth below—

      1. 1. Hospital DSH liabilities are overpay-

ments which will be recouped. If the annual independent DSH audit reflects that a facility has a hospital DSH liability, it is an overpayment to the hospital and is subject to recoupment;

1. 2. Any overpayments that are recouped

from hospitals as the result of the final DSH adjustment will be redistributed to hospitals that are shown to have a total shortfall. These redistributions will occur proportionally based on each hospital’s total shortfall to the total shortfall, not to exceed each hospitalspecific DSH limit;

1. 3. Redistribution payments to hospitals

that have a total shortfall must occur after the recoupment of hospital DSH liabilities. However, total industry redistribution payments may not exceed total industry recoupments collected to date;

1. 4. If the amount of DSH payments to be

recouped as a result of the final DSH adjustment is more than can be redistributed, the entire amount will be recouped and the federal share will be returned to the federal government; and

1. 5. If the Medicaid program’s original

interim DSH payments did not fully expend the federal DSH allotment for any plan year, the remaining DSH allotment may be paid to hospitals that are under their hospital-specific DSH limit as determined from the annual independent DSH audit. These payments will occur proportionally based on each hospital’s shortfall to the total shortfall, not to exceed each hospital’s hospital-specific DSH limit.

1. (8) Record Retention.

   1. (A) Records used to complete the state’s DSH survey shall be kept until the final audit is completed. For example, the SFY 2011 state DSH survey will use 2009 cost data which must be maintained until the 2014 DSH audits are completed in SFY 2015.
   2. (B) Records provided by hospitals to the state’s independent auditor shall also be maintained until the 2014 federal DSH audit is complete.

2. (9) State DSH Survey Reporting Requirements.

   1. (A) Each hospital participating in the MO HealthNet program shall submit a state DSH survey prescribed by the state MO HealthNet agency and must be submitted by December 31 of each year. However, a corrected survey may be accepted if it is supported by documentation and the state determines the correction is appropriate and has a material impact on the survey results. The state DSH survey for each interim DSH payment period shall be completed based on the third prior year Medicare cost report and adjusted for inflationary trends and volume adjustments to the interim DSH payment period. For example, the state DSH survey that will be used to determine SFY 2013 interim DSH payments will be based on the state DSH survey completed using the 2010 Medicare cost report data adjusted by the hospital to 2013.

3. (10) Definitions.

   1. (A) Annual independent DSH audit. The annual independent DSH audit is the annual independent certified audit of the state DSH payments as required by the federal DSH audit rule 42 CFR 455.301 through 42 CFR 455.304. The annual independent DSH audit also includes the reporting requirements of 42 CFR 447.299. The annual independent DSH audit may also be referred to as the federallymandated annual independent DSH audit or independent federal DSH audit.

   2. (B) Estimated Medicaid net cost. Estimated Medicaid net cost is the cost of providing inpatient and outpatient hospital services for all Medicaid eligible individuals including dual eligible and managed care participants less payments the hospital received for claims. The estimated Medicaid net cost is determined by using Medicare cost report costing methodologies described in this rule and is calculated using data reported on the state DSH survey. Depending on the hospital’s response to questions fourteen, fifteen, and sixteen of the state DSH survey the source of the Medicaid Out-of-State net cost, Medicaid Organ Acquisition net cost, and Medicaid/Medicare Crossover net cost will either be: the hospital’s estimated data, an amount estimated by MHD based on the most recent annual independent DSH audit trended to the SFY the DSH payments relate to, or was determined by the hospital to be insignificant or zero. The estimated Medicaid net cost is the sum of the following estimated data:

      1. 1. In-state Medicaid inpatient net cost;
      2. 2. In-state Medicaid outpatient net cost;
      3. 3. Out-of-state Medicaid inpatient net

cost;

1. 4. Out-of-state Medicaid outpatient net

cost;

1. 5. Medicaid organ acquisition net cost;

and

1. 6. Medicaid/Medicare crossover net

cost.

1. (C) Estimated uninsured net cost. Estimated uninsured net cost is the cost of providing inpatient and outpatient hospital services to individuals with no source of third party reimbursement for the inpatient and outpatient hospital services they receive. If the individual had health insurance, even if the third-party insurer did not pay, those services are insured and cannot be included as uninsured costs. The costs are to be calculated using Medicare cost report costing methodologies described in this rule and should not include costs for services that were denied for any reason. The estimated uninsured net cost is calculated as the sum of the following estimated data reported on the state DSH survey.

   1. 1. Uninsured inpatient net cost.
   2. 2. Uninsured outpatient net cost.
2. (D) Estimated uninsured uncompensated care cost (UCC). The estimated uninsured uncompensated care cost is the estimated uninsured net cost less uninsured revenues and Section 1011 payments.
3. (E) Federal DSH allotment. The maximum amount of DSH a state can distribute each year, and receive federal financial participation (FFP) in the payments in accordance with 42 CFR 447.297 and 42 CFR 447.298.

4. (F) Hospital DSH liability. The hospital DSH liability is the amount of DSH overpayments subject to recoupment. It is the lessor of the total longfall or the DSH payments paid during the SFY. The source for this calculation is as follows:

   1. 1. Actual hospital DSH liability. The

actual hospital DSH liability is determined from the final annual independent DSH audit; and

1. 2. Estimated hospital DSH liability. The

estimated hospital DSH liability is calculated by the state using data from the state DSH survey, Medicaid supplemental payments, and data provided in the most recent independent DSH audit, if applicable.

1. (G) Hospital-specific DSH limit. The hospital-specific DSH limit is the sum of the Medicaid uncompensated care cost plus the uninsured uncompensated care cost and is calculated each year. The source for this calculation is as follows:

   1. 1. Actual hospital-specific DSH limit.

The actual hospital-specific DSH limit is determined from the final annual independent DSH audit; and

1. 2. Estimated hospital-specific DSH

limit. The estimated hospital-specific DSH limit is calculated by the state using data from the state DSH survey, Medicaid supplemental payments, and data provided in the most recent independent DSH audit, if applicable.

1. (H) Institution for Mental Diseases (IMD) DSH allotment. The IMD DSH allotment is a portion of the state-wide DSH allotment and is payable only to IMD hospitals.
2. (I) Inpatient and outpatient hospital services. For purposes of determining the estimated hospital-specific DSH limit and the actual hospital-specific DSH limit, the inpatient and outpatient hospital services are limited to inpatient and outpatient hospital services included in the approved Missouri Medicaid State Plan.

3. (J) Longfall. The longfall is the total amount a hospital has been paid (including all DSH payments) in excess of their hospitalspecific DSH limit and is considered an overpayment subject to recoupment. The source for this calculation is as follows:

   1. 1. Actual longfall. The actual longfall is

based on the annual independent DSH audit; and

1. 2. Estimated longfall. The estimated

longfall is calculated by the state using data from the state DSH survey, Medicaid supplemental payments, and data provided in the most recent independent DSH audit, if applicable.

1. (K) Medicaid state plan year. Medicaid state plan year coincides with the twelve (12)- month period for which a state calculates DSH payments. For Missouri, the Medicaid State Plan Year coincides with its state fiscal year (SFY) and is July 1 through June 30.
2. (L) Medicaid supplemental payments. For purposes of determining estimated hospitalspecific DSH limits, the Medicaid supplemental payments include: Direct Medicaid Add- On, Graduate Medical Education (GME), Enhanced GME, Children’s Outliers, Trauma Outliers, and any cost settlements. Upper payment limit (UPL) supplemental payments will be included in addition to the above Medicaid supplemental payments for purposes of determining the hospital-specific DSH limit in the annual independent DSH audit. Any supplemental payments made with state only funds are not required to be offset in determining the hospital-specific DSH limit.
3. (M) Medicare cost reporting methodologies. Medicaid and uninsured costs will be determined utilizing Medicare cost report (form 2552-96) methodologies. If the Medicare 2552-96 is superseded by an alternate Medicare developed cost reporting tool during a Medicaid state plan year, that tool must be used for the Medicaid state plan year. Based on these methodologies, the costs included in the DSH payment calculation will reflect the Medicaid and uninsured portion of total allowable costs from the Medicare cost report. Costs such as the Missouri Medicaid hospital provider tax (federal reimbursement allowance or FRA) are recognized as allowable costs for Medicaid and DSH program purposes and apportioned to Medicaid, uninsured, Medicare, and other payers following the cost finding principles included in the costs report, applicable instructions, regulations, and governing statutes.
4. (N) New facility. A new hospital determined in accordance with 13 CSR 70-15.010 without a base year cost.
5. (O) Out-of-state DSH payments. DSH payments received by a Missouri hospital from a state other than Missouri.
6. (P) Section 1011 payments. Section 1011 payments are made to a hospital for costs incurred for the provision of specific services to specific aliens to the extent that the provider was not otherwise reimbursed for such services. Because a portion of the Section 1011 payments are made for uncompensated care costs that are also eligible under the hospital-specific DSH limit, a defined portion of the Section 1011 payments must be recognized as an amount paid on behalf of those uninsured.

7. (Q) Shortfall. The shortfall is the hospitalspecific DSH limit in excess of the total amount a hospital has been paid (including all DSH payments). The source for this calculation is as follows:

   1. 1. Actual shortfall. The actual shortfall

is based on the annual independent DSH audit; and

1. 2. Estimated shortfall. The estimated

shortfall is calculated by the state using data from the state DSH survey, Medicaid supplemental payments, and data provided in the most recent independent DSH audit, if applicable.

1. (R) State DSH survey. The state DSH survey was designed to reflect the standards of calculating uncompensated care cost established by the federal DSH rules in determining hospital-specific DSH limits. The DSH survey is also similar to the DSH survey that is utilized by the independent auditor during the annual independent DSH audit performed in accordance with the federally-mandated DSH audit rules. The blank state DSH survey is referred to as the state DSH survey template. The following state DSH survey templates and instructions are incorporated by reference and made a part of this rule as published by the Department of Social Services, MO HealthNet Division, 615 Howerton Court, Jefferson City, MO 65109. This rule does not incorporate any subsequent amendments or additions.

   1. 1. Version 1 (9/10), also referred to as

the 2011 state DSH survey, was used to calculate the SFY 2011 DSH payment adjustments set forth in section (4) and the SFY 2012 interim DSH payments set forth in section (5).

1. 2. Version 2 (9/11) will be used to cal-

culate interim DSH payments beginning with SFY 2013 as set forth in section (5). The survey shall be referred to as the SFY to which payments will relate. For example, the survey used to determine interim DSH payments for SFY 2013 will be referred to as the 2013 state DSH survey.

1. (S) Taxable revenue. Taxable revenue is the hospital’s total inpatient adjusted net revenues plus outpatient adjusted net revenues determined in accordance with 13 CSR 70-15.110, paragraph (1)(A)13.
2. (T) Uncompensated care costs (UCC). The uncompensated care costs eligible for consideration in determining the hospital-specific DSH limit are calculated by reducing costs incurred in furnishing inpatient and outpatient hospital services to the Medicaid and uninsured populations, reduced by revenues 13 CSR 70-15

received under Medicaid (not including DSH payments) and Section 1011 payments. The costs are to be calculated using Medicare cost report costing methodologies described in this rule and should not include costs for services that were denied for any reason. For purposes of this calculation the Medicaid and uninsured populations include:

1. 1. The Medicaid population includes all

Medicaid eligible individuals including dual eligible and managed care participants; and

1. 2. The uninsured population includes

individuals with no source of third-party reimbursement for the inpatient and outpatient services they receive. If the individual had health insurance, even if the third-party insurer did not pay, those services are insured and cannot be included as uninsured costs.

1. (U) Uninsured revenues. Payments received on a cash basis that are required to be offset against the uninsured cost to determine the uninsured net cost include any amounts received by the hospital, by or on behalf of, either self-pay or uninsured individuals during the SFY under audit.

AUTHORITY: sections 208.152, 208.153, and 208.201, RSMo Supp. 2010.* Emergency rule filed May 20, 2011, effective June 1, 2011, expired Nov. 28, 2011. Original rule filed May 20, 2011, effective Jan. 30, 2012. *Original authority: 208.152, RSMo 1967, amended 1969, 1971, 1972, 1973, 1975, 1977, 1978, 1978, 1981, 1986, 1988, 1990, 1992, 1993, 2004, 2005, 2007; 208.153, RSMo 1967, amended 1967, 1973, 1989, 1990, 1991, 2007; and 208.201, RSMo 1987, amended 2007.