(Medicare Claims Processing Manual)

Excluded Days   Many States operate programs that include both State -only and Federal -State eligibility groups in an integrated program.  For example, some States provide medical assistance to beneficiaries of State- funded income support programs.  These beneficiaries, ho wever, are not eligible for Medicaid under a State plan approved under Title XIX, and, therefore, days utilized by these beneficiaries do not count in the Medicare disproportionate share adjustment calculation.  If a hospital is unable to distinguish betwe en Medicaid beneficiaries and other medical assistance beneficiaries, then it must contact the State for assistance in doing so.  In addition, if a given patient day affects the level of Medicaid DSH payments to the hospital but the patient is not eligible for Medicaid under a State plan approved under Title XIX on that day, the day is not included in the Medicare DSH calculation.   It should be noted that the types of days discussed above are not necessarily the only types of excluded days.  Please see the chart  in 140.2.4.1, which summarizes some, but not necessarily all, of the types of days to be excluded from (or included in) the Medicare DSH adjustment calculation.   To provide consistency in both components of the calculation, any days that are added to the Medicaid day count must also be added to the total day count, to the extent that they have not been previously so added.  Regardless of the type of allowable Medicaid day, the hospital bears the burden of proof and must verify with the State that the patient was eligible under one of the allowable categories during each day of the patient's stay.  The hospital is responsible for and must provide adequate documentation to substantiate the number of Medicaid days claimed.  Days for patients that cannot be verified by State records to have fallen within a period wherein the patient was eligible for Medicaid as described in this m emorandum cannot be counted.  20.3.1.2 - Hold Harmless for Cost Reporting Periods Beginning Before January 1, 2000  (Rev. 1, 10- 01-03)  In accordance with the hold harmless position communicated by CMS on October 15, 1999, for cost reporting periods beginning before January 1, 2000, hospitals are not to disallow, within the parameters discussed below, the portion of Medicare DSH adjustment  payments previously made to hospitals attributable to the erroneous inclusion of general assistance or other State -only health program, charity care, Medicaid DSH, and/or ineligible waiver or demonstration population days in the Medicaid days factor used in the Medicare DSH formula.  This is consistent with CMS' determination that hospitals and A/B MACs (A) relied, for the most part, on Medicaid days data obtained from State Medicaid agencies to compute Medicare DSH payments and that some of those agencies  commingled the types of otherwise ineligible days listed above with Medicaid Title XIX days in the data transmitted to hospitals and/or A/B MACs (A).  Although CMS has decided to allow the hospitals to be held harmless for receiving additional payments re sulting from the erroneous inclusion of these types of otherwise ineligible days, this decision is not intended to hold hospitals harmless for any other aspect of the calculation of Medicare DSH payments or any other Medicare payments.   Hospitals That Received Payments Reflecting the Erroneous Inclusion of Days at Issue   In practical terms this means that the A/B MAC (A) is not to reopen any cost reports for cost reporting periods beginning before January 1, 2000, to disallow the portions of Medicare DSH payments attributable to the erroneous inclusion of general assistanc e or other State -only health program charity care, Medicaid DSH, and/or ineligible waiver or demonstration population days if the hospital received payments for those days based on those cost reports.  If, prior to the issuance of this Program Memorandum, a hospital reopened a settled cost report to disallow the portion of Medicare DSH payment attributable to the inclusion of these types of days, reopen that cost report again and refund the amounts (including interest) collected.  Do not, however, pay the hospitals interest on the amounts previously recouped as result of the disallowance.  Furthermore, on or after October 15, 1999, the A/B MAC (A) is not to accept reopening requests for previously settled cost reports or amendments to previously submitted cost reports pertaining to the inclusion of these types of days in the Medicare DSH formula.  For cost reporting periods beginning before January 1, 2000, hospitals are to continue to allow these types of days in the Medicare DSH calculation for all open cost reports only in accordance with the practice followed for the hospital at issue before October 15, 1999, (i.e., for open cost reports, the A/B MAC (A) allows only those types of otherwise ineligible days that the hospital received payment for in previous cost reporting periods settled before October 15, 1999).  For example, if, for a given hospital, a portion of Medicare  DSH payment was attributable to the erroneous inclusion of general assistance days for only the out -of-State or HMO population in cost reports settled before October 15, 1999, the A/B MAC (A) is to include the ineligible waiver days for only that populati on when settling open cost reports for cost reporting periods beginning before January 1, 2000.  However, the actual number of general assistance and other State -only health program, charity care, Medicaid DSH, and/or ineligible waiver or demonstration days, as well as Medicaid Title XIX days that the A/B MAC (A) allows for the open cost reports must be supported by auditable documentation provided by the hospital.  Hospitals That Did Not Receive Payments Reflecting the Erroneous Inclusion of Days at Issue   If a hospital did not receive any payment based on the erroneous inclusion of general assistance or other State -only health program, charity care, Medicaid DSH, and/or waiver or demonstration population days for cost reports that were settled before October 15, 1999, and the hospital never filed a jurisdictionally proper appeal to the Provider Reimbursement Review Board (PRRB) on this issue, the A/B MAC (A) is not to pay the hospital based on the inclusion of these types of days for any open cost reports for cost reporting periods beginning before January 1, 2000.  Furthermore, on or after October 15, 1999, the A/B MAC (A) is not to accept reopening requests for previously settled cost reports or amendments to previously submitted cost reports pertaining to the inclusion of these types of days in the Medicare DSH formula.   If, for cost reporting periods beginning before January 1, 2000, a hospital that did not receive payments reflecting the erroneous inclusion of otherwise ineligible days filed a jurisdictionally proper appeal to the PRRB on the issue of the exclusion of these types of days from the Medicare DSH formula before October 15, 1999, the A/B MAC (A) will reopen the cost report at issue and revise the Medicare DSH payment to reflect the inclusion of these types of days as Medicaid days.  If there are any questions or concerns regarding the qualifications for a "jurisdictionally proper appeal," the A/B MAC (A) submits them in writing before rendering a decision in a specific case to:   Centers for Medicare & Medicaid Services  7500 Security Boulevard  Office of Financial Management  Financial Services Group  Location C3- 14-16 Baltimore, Maryland 21244- 1850.  Where, for cost reporting periods beginning before January 1, 2000, a hospital filed a jurisdictionally proper appeal to the PRRB on the issue of the exclusion of these types of days from the Medicare DSH formula on or after October 15, 1999, reopen the se ttled cost report at issue and revise the Medicare DSH payment to reflect the inclusion of these types of days as Medicaid days, but only if the hospital appealed, before October 15, 1999, the denial of payment for the days in question in previous cost reporting periods.  The actual number of these types of days that are used in this revision must be properly supported by adequate documentation provided by the hospital.  Do not reopen a cost report and revise the Medicare DSH payment to reflect the inclusion of these types of days as Medicaid days if, on or after October 15, 1999, a hospital added the issue of the exclusion of these types of days to a jurisdictionally proper appeal already pending before PRRB on other Medicare DSH issues or other unrelated i ssues.   Continue to pay the Medicare DSH adjustment reflecting the inclusion of general assistance or other State -only health program, charity care, Medicaid DSH, and/or waiver or demonstration population days for all open cost reports for cost reporting periods beginning before January 1, 2000, to any hospital that, before October 15, 1999, filed a jurisdictionally proper appeal to the PRRB specifically for this issue on previously settled cost reports.   Finally, if a hospital has filed a jurisdictionally proper appeal with respect to the CMS  97-2 ruling and the hospital has otherwise received payment for the portion of Medicare DSH adjustment attributable to the inclusion of general assistance or other St ate-only health programs, charity care, Medicaid DSH, and/or ineligible waiver or demonstration population days based on its paid Medicaid days, include these types of  unpaid days in the Medicare DSH formula when revising the cost reports affected by the CMS 97- 2 appeal.   TYPE OF DAY DESCRIPTION ELIGIBLE  TITLE XIX DAY  General Assistance Patient Days  Days for patients covered under a State -only (or county-only) general assistance program (whether or not any payment is available for health care services under the program).  These patients are not Medicaid -eligible under the State plan.  No. Other State -Only Health Program Patient Days  Days for patients covered under a State- only health program.  These patients are not Medicaid- eligible under the State plan.  No. Charity Care Patient Days  Days for patients not eligible for Medicaid or any other third -party payer, and claimed as uncompensated care by a hospital.  These patients are not Medicaid- eligible under the State plan.  No. Actual 1902(r)(2) and 1931(b) Days  Days for patients eligible under a State plan based on a 1902(r)(2) or 1931(b) election.  These patients are Medicaid -eligible under the Title XIX State plan under the authority of these provisions, which is exercised by the State in the context of the approved State plan.   Yes. Medicaid Optional Targeted Low -Income Children (CHIP -related) Days  Days for patients who are Title XIX -eligible and who meet the definition of "optional targeted low -income children" under 1905(u)(2) .  The difference between these children and other Title XIX children is the enhanced FMAP rate available to the State.  These children are fully Medicaid -eligible under the State plan.  Yes. TYPE OF DAY DESCRIPTION ELIGIBLE  TITLE XIX DAY  Separate CHIP Days Days for patients who are eligible for benefits under a non-Medicaid State program furnishing child health assistance to targeted low -income children.  These children are, by definition, not Medicaid- eligible under a State plan.  No. 1915(c)  Eligible Patient (the "217" group) Days  Days for patients in the eligibility group under the State plan for individuals under a Home and Community Based Services waiver.  This group includes individuals who would be Medicaid- eligible if they were in a medical institution.  Under this special eli gibility group, they are Medicaid -eligible under the State plan.  Yes. Retroactive Eligible Days  Days for patients not enrolled in the Medicaid program at the time of service, but found retroactively eligible for Medicaid benefits for the days at issue.  These patients are Medicaid -eligible under the State plan.  Yes. Medicaid Managed Care Organization Days  Days for patients who are eligible for Medicaid under a State plan when the payment to the hospital is made by an MCO for the service.  An MCO is the financing mechanism for Medicaid benefits, and payment for the service through the MCO does not affect eli gibility.  Yes. Medicaid DSH Days  Days for patients who are not eligible for Medicaid benefits, but are considered in the calculation of Medicaid DSH payments by the State.  These patients are not Medicaid -eligible.  Sometimes Medicaid State plans specify that Medicaid DSH payments are based upon a hospital's amount of charity care or general assistance days.  This, however, is not "payment" for those days, and does not mean that the patient is eligible for Medicaid benefits or can be counted as such in the Medicare formula.  No.  20.3.1.3  Disproportionate Share Hospital (DSH) Policy Changes Effective for Cost Reporting Periods beginning on or after October 1, 2009  (Rev. 2627, Issued 01- 04-13, Effective 10- 01-12, Implementation 10- 01-12)  Observation Days