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Category: Medicaid

Supreme Court Sides with HHS in Dual Eligible Part A Benefits Case

The Supreme Court on Friday issued the decision in Becerra v. Empire Health Foundation (see pdf file at link). Unfortunately, in a 5-4 decision, the Court overruled the Ninth Circuit’s decision and decided instead for the government, holding that the language “entitled to benefits under Part A” does not exclusively refer to a patient who has a right to payment. This means that the Supreme Court has sided with HHS’s decision to include non-covered Medicare Part A days (such as exhausted benefit days and Medicare Secondary Payer days) in the SSI Ratio of the Medicare DSH payment calculation. 
 
In a prior decision, the Ninth Circuit found for providers in May 2020, holding that HHS was treating the words “entitled” and “eligible” synonymously, in contradiction of statute. In a surprising and somewhat puzzling turn, the Supreme Court has disagreed with the Ninth Circuit’s analysis, settling the issue in favor of HHS.
 
Toyon has been representing many of your interests in appealing the agency’s implementation of the 2005 Rule relating to non-covered Part A days, as providers had consistently held that non-covered Part A days should be excluded from the SSI Fraction and included only in the numerator of the Medicaid Fraction. We are working with our attorneys to determine any potential next steps or strategies that may be available to our clients, in light of this disappointing court decision. We will contact you in the coming weeks as necessary if there is any further opportunity to pursue this issue. 
 
In the meantime, please contact Karen S. Kim at (925) 685-9312 or at karen.kim@toyonassociates.com if you have any questions. 
Posted in: Appeals, DSH, Mcare DSH, Medicaid
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CARES PROVIDER RELIEF FUND (PRF) Phase 4 Funding Update

 

 

1.  Begins Distributing Phase 4 Payments

2.  Toyon’s Template is Available to Assist Providers Reconcile Phase 4 Base Payments.

3.  Providers have until December 20, 2021 (11:59 PM ET) to correct errors related to PRF Reporting Period 1.

 

  
Toyon is pleased to provide this update on the CARES Provider Relief Fund (PRF). For more information, please contact Fred Fisher at 888.514.9312, fred.fisher@toyonassociates.com.
 
1.  HRSA is Distributing Phase 4 Funds
Today, December 16, 2021, HRSA began distributing $9 billion, out of $17 billion, in Phase 4 Funding to more than 69,000 providers.    
 
Phase 4 Base Payments
75% of Total Phase 4 Funding ($12.75 billion)
 
Phase 4 Funding is broken down into two parts, with the first being the Base Phase 4 payment. Phase 4 base payments are adjusted depending on annual patient care revenue. Funding percentages range from 20% (for large providers) to 45% (for small providers). These funding percentages are significantly less than the 88% funding percentage applied in Phase 3.
  • Small sized providers receive 45% of Phase 4 losses. Small providers have less than or equal to $10 million in annual patient care revenue. The current average payment is $58,000.
  • Medium sized providers receive 25% of Phase 4 losses. Medium providers have more than $10 million and less than $100 million in annual patient care revenue. The current average payment is $289,000.
  • Large sized providers receive 20% of Phase 4 losses. Large providers have $100 million or more in patient care revenue. The current average payment is $1.7 million.
HRSA’s Phase 4 methodology takes additional steps to flag aberrant data, and offset losses for “PRF payments not previously deducted in Phase 3.” Toyon believes HRSA is carrying forward PRF in excess of Phase 3 losses and reducing Phase 4 payments by this amount.
 
Bonus Payments
25% of Total Phase 4 Funding (~$4.25 billion)
 
In addition to the Base Phase 4 payment, HRSA is also disbursing “bonus” Phase 4 payments. Similar to rural payments from the American Rescue Plan (ARP), Phase 4 bonus payments are based on Medicare, Medicaid, and CHIP administrative claims data from January 1, 2019 through September 30, 2020 (Phase 4 bonus payments uses all claims as compared to the Rural ARP which uses rural claims). 
 
HRSA calculates Phase 4 bonus payments by determining the difference between payments at Medicaid rates versus payments at Medicare rates. The difference in payments is then reduced in a budget neutral manner to fit “the portion of funding set aside for bonus payments.” Based on eligibility criteria to apply for Phase 4 payments, it is believed HRSA used inpatient and outpatient claims from both Fee for Service and Managed Care payors. 
 
2.  Toyon’s Template to Reconcile Phase 4 Base Payments
Please feel free to use Toyon’s template to reconcile Base Phase 4 payments. The template is available here for download on Toyon’s website. 
  • The first of the two tabs is populated with hypothetical information to show how the provider’s Phase 4 payment was determined. 
  • The second tab is a template for provider input. 
  • To use this tab, input information into the grey cells and the formulas will calculate throughout the spreadsheet. 
  • Please note the current template utilizes thresholds to determine aberrant data, and potential “flags”, from thresholds established in Phase 3.  
  • To avoid amounts from being adjusted from any flags, please ensure “Yes” is populated in key columns AD and AJ. 
3.     CARES PRF Reporting Period 1 Correction and Period 2 Reporting
The PRF Period 1 Reporting Portal is now open through December 20, 2021 (11:59 PM ET) for any provider that still needs to register or submit | correct information related to PRF Reporting Period 1. PRF recipients looking to correct an error must contact the Provider Support Line (866-569-3522) to gain access to their submitted report.
 
The PRF Period 2 Reporting Portal is slated to open on January 1, 2022 and close March 31, 2022. PRF Reporting Period 2 will cover PRF amounts received from July 1, 2020 through December 31, 2020 and expenses and lost revenues incurred during the “period of availability” of January 1, 2020 through December 31, 2020 (excluding any amounts that were already applied towards PRF Reporting for Period 1). 
 
Toyon is committed to apprising providers with important reimbursement updates and will keep you updated with the latest COVID-19 funding and documentation news. Please feel free to visit Toyon’s COVID-19 Resources for more information.  
 
Thank you
Posted in: CARES, COVID-19, Medicaid, Medicare
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IMPORTANT COVID-19 HOSPITAL FUNDING UPDATE

 

 

 
 

 

1. Important Deadline:

June 15 is the deadline to submit January 1 through June 10 COVID-19 inpatient admissions for the next round of High Impact Funding.

2.  HHS released updated FAQs including:

  • Reporting COVID-19 admissions.
  • Reporting expenses and lost revenues.
  • Clarifications for parent organizations with subsidiaries.

3. HHS allocated $25 billion toward:

  • $15 billion for Medicaid & CHIP providers.
  • $10 billion for Safety Net Hospital Funding.

 
Toyon is pleased to provide this update on the CARES Act Public Health and Social Services Emergency Fund (PHSSEF).   For more information, or to contact any of our team members, please feel free to visit Toyon’s website.

1. Important Deadline: Monday June 15
HHS contacted all hospitals requesting COVID-19 positive-inpatient admissions for January 1 through the end of the day June 10.  These cases will be used for the second round COVID-19 High Impact funding.  Funding from the first round of High Impact Payments will be taken into account in the second round.  Hospitals have until June 15 (9 PM EDT) to submit admission detail.  Toyon recommends hospitals evaluate HHS’s FAQs and contact TeleTracking for assistance 
(877-570-6903).
 
2. Observations from Updated FAQs
The CARES Act Provider Relief Fund FAQs were last updated Tuesday June 9.   Listed below are notable updates by category:
 
 
Reporting COVID-19 Admissions:
  • Patients with a pending positive test that came back positive after June 10 are not allowed in COVID-19 admissions data due June 15.
  • Do not include emergency department patients in COVID-19 admissions data.
  • Admissions occurring at multiple campuses, under the same TIN, should be reported separately and not rolled up into one count.
  • If the prior submission of COVID-19 positive admissions was submitted in error (i.e., all COVID-19 positive admissions submitted by system instead of by facility), HHS requests providers to use TeleTracking to correct and update the data to reflect all COVID-19 positive inpatient admissions from January 1 through June 10.
CARES Provider Relief Funding
  • HHS expects providers will only use Provider Relief Fund payments for permissible purposes. If, at the conclusion of the pandemic, providers have leftover Provider Relief Fund money that cannot be expended on permissible expenses or losses, then providers will return this money to HHS. 
COVID-19 Expenses and Lost Revenues
  • HHS will be providing further guidance about the type of documentation to provide per the terms and conditions (e.g., documentation due with quarterly reports July 10).  
  • HHS clarifies the term “healthcare related expenses attributable to coronavirus” is a broad term for determining eligibility of expenses and lost revenues eligible for reimbursement including:
    • supplies used to provide healthcare services for possible or actual COVID-19 patients,
    • equipment used to provide healthcare services for possible or actual COVID-19 patients,
    • workforce training; developing and staffing emergency operation centers; reporting COVID-19 test results to federal, state, or local governments,
    • building or constructing temporary structures to expand capacity for COVID-19 patient care or to provide healthcare services to non-COVID-19 patients in a separate area from where COVID-19 patients are being treated; and
    • acquiring additional resources, including facilities, equipment, supplies, healthcare practices, staffing, and technology to expand or preserve care delivery.
  • Providers may have incurred eligible health care related expenses attributable to coronavirus prior to the date on which they received their payment.  HHS expects that it would be highly unusual for providers to have incurred eligible expenses prior to January 1.
  • The term “lost revenues that are attributable to coronavirus” means any revenue lost to providers due to the coronavirus. 
  • HHS encourages the use of funds to cover lost revenue so providers can respond to the coronavirus public health emergency to cover employee or contractor payroll, employee health insurance, rent or mortgage payments, equipment lease payments and electronic health record licensing fees.
Parent Organizations and Subsidiaries
  • Parent organizations with multiple billing TINs that each received payments, may attest and keep the payments as long as providers associated with the parent organization were providing diagnoses, testing, or care for individuals with possible or actual cases of COVID-19 on or after January 31 and can otherwise attest to the Terms and Conditions.  The parent organization can allocate funds at its discretion to its subsidiaries. If the parent organization would like to control and allocate Provider Relief Fund payments to its subsidiaries, the parent organization must attest to accepting its subsidiaries’ payments and agreeing to the Terms and Conditions.
  • Providers with TINs covering all business lines can report lost revenues under the same TIN that are actively caring for patients with COVID-19 or actively working to prevent the spread of COVID-19.
  • Parent entities, submitting revenue information on behalf their subsidiaries may encounter an issue if they have multiple Medicare/Medicaid provider numbers (there is only one space in the HHS Portals to populate these numbers). HHS states these providers should submit a statement on the first page of the uploaded tax return file stating (i) the parent entity’s Filing TIN and that it does not bill Medicare and (ii) a schedule of the billing subsidiaries, their Billing TINs, their Medicare/Medicaid ID numbers, and gross sales or receipts.
On Tuesday, June 9, HHS announced the following funding allocations:
  • $15 billion Medicaid and CHIP funding to eligible providers that participate in state programs and have not received a payment from the Provider Relief Fund General Distribution. Approximately one million health care providers may be eligible for this funding.
  • $10 billion safety net funding to approximately 760 hospitals. HHS states the safety net distribution will occur this week. Recipients will receive a minimum payment of $5 million and a maximum payment of $50 million. In order to qualify for this funding, hospitals must have:
    • A Medicare Disproportionate Payment Percentage (DPP) of 20.2 percent or greater,
    • average Uncompensated Care per bed of $25,000 or more, and
    • profitability of 3 percent or less, as reported to CMS in its most recently filed Cost Report.

Toyon has updated our Provider Relief Fund estimates to include hospitals eligible for safety net funding. This information will soon be available on our website. In the meantime if you have any questions on these estimates, please contact Fred Fisher at 888.514.9312, fred.fisher@toyonassociates.com.  
 
Toyon is committed to apprising providers with important reimbursement updates and will keep you updated with the latest on UC DSH and COVID-19 funding and documentation. Please feel free to visit Toyon’s COVID-19 Resources for updates on hospital funding estimates, and recommendations on documenting cost and revenue losses associated with this public health emergency. Toyon’s website provides information on how to contact Toyon’s team members.  
Posted in: CMS, COVID-19, DSH, Medicaid, UCRS
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