Arkansas Administrative Code › Agency 016 - DEPARTMENT OF HUMAN SERVICES › Division 06 - Medical Services › Rule 016.06.07-034 - State Plan Amendment #2007-003 - Inpatient Hospital Services

Current through Register Vol. 49, No. 6, June, 2024
1. Inpatient
			 Hospital Services
The State has in place a public process, which complies with
				the requirements of Section 1902(a)(13)(A) of the Social Security Act.
In accordance with Section 1902(s) of the Social Security Act,
				we do not impose dollar limits on any inpatient hospital services for children
				under age one (or children that are hospitalized on their first birthday). This
				includes the $850.00 per diem cost limit, the TEFRA rate of increase limit, the
				customary charge upper limit or the $150,000 bone marrow transplant limit. This
				applies to all inpatient hospitals.
Effective for claims with dates of service on or after
January 1, 2007,
all acute care hospitals with the exception of
				Pediatric Hospitals,
Border City University-Affiliated Pediatric Teaching
				Hospitals,
Arkansas State Operated Teaching Hospitals, Rehabilitative
				Hospitals, Inpatient Psychiatric Hospitals, Out-Of-State Hospitals and Critical
				Access Hospitals will be reimbursed based on reasonable cost with interim per
				diem rates and year-end cost settlements, with a cost limit of $850 per
				day.
Arkansas Medicaid will use the lesser of cost or charges or the
				$850 per diem cost limit multiplied by total hospital Medicaid days to
				establish cost settlements. Except for malpractice insurance, graduate medical
				education costs and the base period for determining the TEFRA target limits,
				the interim per diem rates and the cost settlements are calculated in a manner
				consistent with the method used by the Medicare Program. The definition of
				allowable costs to be used is as follows:
(a) The State will use the Medicare allowable
			 costs as stated in the HIM-15/PRM-15.
The State will use the criteria referenced in
				42 CFR, Section
				413.89(e) - Criteria for
				allowable bad debt, to determine allowable bad debt.
(b) Physicians/Administrative/Teachers will
			 be included in costs as recognized by Medicare reimbursement principles.
At cost settlement, Arkansas Medicaid will limit reimbursement
				to the lowest of the following:
(a)
			 Allowable costs after application of the TEFRA rate of increase limit. The
			 TEFRA rate of increase limit is the hospital's TEFRA target rate multiplied by
			 its total number of Medicaid discharges.
Effective for cost reporting periods ending on or after June
				30, 2000, the TEFRA rate of increase limit will no longer be applied to
				Arkansas State Operated Teaching Hospitals.
(b) The hospital's customary charges to the
			 general public for the services. (This will be applied on an annual basis at
			 cost settlement.)
(c) A maximum
			 limit per Medicaid days. The maximum limit is the total number of Medicaid
			 inpatient days during the cost reporting period multiplied by the $850.00 per
			 diem cost limit.
Pediatric Hospitals
Refer to Attachment 4.19-A, Page 3, 3a
and
3b, for
				the reimbursement methodology for transplant services.
Arkansas' method of reimbursing malpractice insurance for
				pediatric hospitals will be a simple calculation made outside the cost report
				and the result added back on to the Medicaid settlement page of the report. The
				calculation would apply a Medicaid utilization factor based on cost to the
				portion of total malpractice expense (91.5%) which is reimbursed for Medicare
				on worksheet D-8 of the cost report. The remaining 8.5% remains on worksheet A
				of the cost report and flows through to be reimbursed like any other
				administrative cost. The final result would be to reimburse malpractice for
				Medicaid as though all malpractice expense remained on worksheet A and simply
				flowed through the cost report.
Direct medical education costs, including graduate medical
				education costs, are reimbursed based on Medicare reasonable cost rules in
				effect prior to the effective date of the September 29, 1989 rule.
Border City University-Affiliated Pediatric Teaching
				Hospitals
Special consideration is given to border city
				university-affiliated pediatric teaching hospitals due to the higher costs
				typically associated with such hospitals. Arkansas Medicaid cost-settles with
				enrolled Medicaid providers for inpatient services provided to patients age 1
				to 21 by border city university-affiliated pediatric teaching hospitals on a
				per diem basis. The per diem is the provider's actual allowable Medicaid per
				diem cost for all the inpatient Medicaid days for persons over age one that
				were furnished by the enrolled provider within the most recent completed cost
				reporting period. As a condition of the cost settlement, the provider shall
				certify the number of patient days for patients age 1 to 21 provided by the
				border city university-affiliated pediatric teaching hospital during the cost
				settlement period.
A border city university-affiliated pediatric teaching
				hospital is defined as a hospital located within a bordering city (see
				Attachment 4.19-A page 3b) that submits to the Arkansas Medicaid Program a copy
				of a current and effective affiliation agreement with an accredited university,
				and documentation establishing that the hospital is university-affiliated, is
				licensed and designated as a pediatric hospital or pediatric primary hospital
				within its home state, maintains at least five different intern pediatric
				specialty training programs, and maintains at least one-hundred (100) operated
				beds dedicated exclusively for the treatment of patients under the age of
				21.
Limited Acute Care Hospital Inpatient Quality
				Incentive Payment
Effective for claims with dates of service on or after
January 1, 2007,
all acute care hospitals with the exception of
				Pediatric Hospitals,
Border City University-Affiliated Pediatric Teaching
				Hospitals,
Arkansas State Operated Teaching Hospitals, Rehabilitative
				Hospitals, Inpatient Psychiatric Hospitals, Critical Access Hospitals, and
				Out-of-State Hospitals may qualify for an Inpatient Quality Incentive Payment.
				The Inpatient Quality Incentive Payment shall be a per diem amount reimbursed
				in addition to the hospital's cost-based interim per diem rate and shall be
				payable for beneficiaries ages 1 and above only (does not include children
				hospitalized on their first birthday). The Inpatient Quality Incentive Payment
				shall equal $50 or 5.9% of the interim per diem rate, whichever is lower. The
				Inpatient Quality Incentive Payment reimbursement amounts shall not be included
				when calculating hospital year-end cost settlements.
The State Agency will determine which quality measures will be
				designated for the Inpatient Quality Incentive Payment for the upcoming year
				and the required compliance rate for each measure. The State Agency will
				utilize quality measures which are reported by hospitals under the Medicare
				program. In order to qualify for an Inpatient Quality Incentive Payment, a
				hospital must meet or exceed the compliance rate on two-thirds of the
				designated quality measures designated by the State Agency for the most
				recently completed reporting period. A hospital that meets or exceeds the
				compliance rate on two-thirds of the designated quality measures shall receive
				an Inpatient Quality Incentive Payment for that year.
Private Hospital Inpatient
				Adjustment
Effective April 19, 2001, all Arkansas private acute care and
				critical access hospitals (that is, all acute care and critical access
				hospitals within the state of Arkansas that are neither owned nor operated by
				state or local government), with the exception of private pediatric hospitals,
				shall qualify for a private hospital inpatient rate adjustment. Effective
				August 1, 2002, all Arkansas private inpatient psychiatric and rehabilitative
				hospitals (that is, all inpatient psychiatric and rehabilitative hospitals
				within the state of Arkansas that are neither owned nor operated by state or
				local government) shall qualify for a private hospital inpatient rate
				adjustment. The adjustment shall be equal to each eligible hospital=s pro rata
				share of a funding pool, based on the hospital=s Medicaid discharges. The
				adjustment shall be calculated as follows:
1. The amount of the funding pool shall be
			 $24,200,000 for State Fiscal Year (SFY) 2007 and $25,200,000 for SFY
			 2008.
2. For each private hospital
			 eligible for the adjustment, Arkansas shall determine the number of Medicaid
			 discharges for the hospital for the most recent audited fiscal year.
For hospitals who, for the most recently audited cost report
				year filed a partial year cost report, such partial year cost report data shall
				be annualized to determine their rate adjustment; provided that such hospital
				was licensed and providing services throughout the entire cost report year.
				Hospitals with partial year cost reports who were not licensed and providing
				services throughout the entire cost report year shall receive pro-rated
				adjustments based on the partial year data.
SUBJECT: Provider Manual Update Transmittal
				#117
REMOVE
INSERT
Section
Date
Section
Date
250.230
7-1-06
250.230
7-1-07
250.240
7-1-06
250.240
7-1-07
-
-
251.010
7-1-07