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LATEST INDUSTRY NEWS

Comments on Proposed Cost Reporting Instructions

CMS recently released new proposed Medicare cost reporting instructions, available for download here on the CMS website. Comments are due to CMS by July 22, and can be submitted electronically at this link
 
Please see Toyon’s comments on CMS’s proposed cost report instructions here. Additionally, to assist with comments to CMS, providers may download the Hospital | Health System template here. Please review all comments prior to submitting, and feel free to use some or all of the content in this letter. Providers may also amend the language to best articulate comments to CMS using hospital-specific examples, etc. 
 
Toyon comments on the following:
  • Worksheet S-2 Lines 24 and 25: Medicaid DSH Eligible Days
  • Worksheet S-2 Line 89: TEFRA Adjustment Date
  • Worksheet S-2 Line 123: Purchased Administrative Services
  • Exhibit 2A: Listing of Medicare Bad Debts
  • Exhibit 3A: Listing of Medicaid Eligible Days for DSH Eligible Hospitals
  • Worksheet S-10: Financial Assistance Policies
  • Worksheet S-10: Acute Care Only
  • Worksheet S-10: Medically Necessary Healthcare
  • Worksheet S-10: Uninsured Charity Care
  • Worksheet S-10: Insured Charity Care
  • Worksheet S-10: Inferred Contractual Relationships
  • Worksheet S-10: Total Bad Debt
  • Exhibit 3B (Charity Care Listing)
  • Exhibit 3C (Listing of Total Bad Debts)
 
Worksheet S-10 UC DSH
Amongst other proposed revisions, CMS calls for providers to report Uncompensated Care (UC) costs for acute care services only (based on hospital Medicare provider number) on Worksheet S-10 Part II. Please note Section IV of the Hospital | Health System template requests CMS to omit this reporting requirement, as delineating Worksheet S-10 UC cost between acute care and sub-acute care adds another administrative burden to Worksheet S-10 reporting. Toyon acknowledges the reporting of acute care only for UC DSH payments may result in a shift in UC DSH payments for certain hospitals (depending on whether a DSH provider has material charity and bad debt related to subacute providers). Toyon is not commenting on a potential shift in payments, and only focuses on the additional administrative effort of collecting and reporting Worksheet S-10 data.   
 
Organ Acquisition Changes
Toyon is not commenting on CMS’s proposed changes related to Organ Acquisition reporting and reimbursement. Toyon agrees with CMS’s proposed changes, which were also included in the previous PRA package from November 2020. Listed below are CMS’s proposed changes related to Organ Acquisition. 
 
Worksheet A, Lines 78 and 102
CMS is adding lines 78 (CAR T-Cell Immunotherapy) and 102 (Opioid Treatment Program), which will require hospitals to create separate G/L departments to track these expenses and charges. Line 78 is used for reporting IPPS (D-3) and OPPS (D Part V) charges from the PS&R. Line 102 is informational only and is not included in the PS&R charges.
 
Worksheet D-6 series
This is a new form used to obtain cost-based reimbursement for allogeneic stem cell acquisition costs. CMS made several noteworthy updates to this form from the previous PRA in November 2020. First, there’s no longer a checkbox to include CAR T-Cell acquisition costs in this section which was to be reported for informational purposes only (see comment above for Worksheet A line 78).
 
Second, the Medicare reimbursement for allogeneic stem cell acquisition costs will now be based on the ratio of Medicare to total transplants, much like the methodology for solid organ. Previously, the form required only to include donor charges for Medicare recipients to determine the Medicare portion. Worksheet D-6 (Part I) now requires hospitals to capture donor charges for all payers. This methodology is a departure from the CMS comments in the FFY 2019 IPPS Final Rule, so CMS may issue a separate rule with comment period for this change.
 
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Please feel free to share questions to Fred Fisher, fred.fisher@toyonassociates.com. Specific to Organ Acquisition reimbursement, please contact Robert Howey at robert.howey@toyonassociates.com
 
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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. 
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CMS Proposes New Cost Reporting Instructions

CMS recently released new proposed Medicare cost reporting instructions, available for download here on the CMS website. Comments are due to CMS on July 22, and Toyon will be sharing our comments with more details over the coming weeks.  
 
CMS is proposing notable cost report changes to the following:
  • Worksheet S-10 Uncompensated Care (UC) reporting for Federal Fiscal Year 2023 (beginning on/after 10/1/2022) and subsequent years.
    • Amongst other proposed revisions, CMS proposes a significant change that UC cost represents “only the general short-term hospital inpatient and outpatient services billable under the hospital CMS Certification Number (CCN).”
    • CMS proposes a standard Worksheet S-10 data format under Exhibit 3B and Exhibit 3C.
  • Empirical DSH Medicaid eligible days reported using Exhibit 3A, with applicable instructions to §4004.1 and requirements at 42 CFR 413.24(f)(5)(i)(C) starting with Federal Fiscal Year 2023 cost reports.
  • Medicare bad debt reporting using Exhibit 2A, with applicable instructions to §4004.2 and requirements at CFR 413.24(f)(5)(i)(B) starting with Federal Fiscal Year 2023 cost reports.
  • COVID-19 PHE temporary expansion bed reporting. New cost reporting line effective March 1, 2020 through the end of the COVID-19 PHE.
  • Worksheet D-4 Organ Acquisition updates and additions. 
    • CMS updates cost reporting instructions to reflect the codification for Medicare organ acquisition payment policies at transplant hospitals as included in FR 73416 (December 27, 2021).
    • For cost reporting periods beginning on or after October 1, 2022, CMS proposes providers separately identify revenue for organs sold associated with Medicare Secondary Payer (MSP organs, subscript of line 66) and a separate subscripted line (informational only) for the transplant payment portion.
    • For cost reporting periods beginning on or after October 1, 2022, CMS proposes providers separately identify organs transplanted into Medicare beneficiaries, kidneys transplanted into Medicare Advantage (MA) beneficiaries, organs transplanted as Medicare Secondary Payer, and organs transplanted for all other payers (subscript line 75).    
  • Worksheet D-6 Allogeneic Hematopoietic Stem Cell Transplant (HSCT) Acquisition Costs
    • CMS proposes further changes to this new worksheet series to calculate inpatient reimbursement for allogeneic stem cell acquisition costs associated with Federal Fiscal Year 2021 cost reports (beginning on or after 10/1/2020).
    • CMS proposes to apply key changes (from the initial PRA package issued in November 2020) which include basing payment on the ratio of Medicare transplants to total transplants and reporting all-payer charges related to donors (follows the same methodology as solid organ transplants).
Please feel free to share questions or suggestions for comments to Fred Fisher, fred.fisher@toyonsassociates.com. Specific to organ acquisition, please contact Robert Howey, robert.howey@toyonassociates.com.
 
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