On April 28, 2010, CMS issued a sweeping ruling that will affect many hundreds of hospitals, and thousands of cost years, with

disproportionate share hospital (DSH) reimbursement challenges. The Ruling, CMS-198-R, addresses three specific DSH issues: (1) the data matching process employed by CMS in calculating the days in the Supplemental Security Income (SSI) fraction; (2) prior to October 1, 2004, the exclusion from the Medicaid fraction of Medicare secondary payor (MSP) days and days for which a patient’s Part A inpatient hospital benefit days were exhausted (exhausted days); and (3) prior to October 1, 2009, the exclusion of labor/delivery room inpatient days from the DSH computation. For cases presenting these issues, the Ruling requires the administrative body – whether it be the Provider Reimbursement Review Board, the CMS Administrator, or the CMS reviewing official – to remand the appeal to the appropriate Medicare contractor for recomputation. Thomas W. Coons of Ober|Kaler discusses.