Missouri Code of State Regulations › Title 13 - DEPARTMENT OF SOCIAL SERVICES › Division 70 - MO HealthNet Division › Chapter 15 - Hospital Program › Section 13 CSR 70-15.110 - Federal Reimbursement Allowance (FRA)

Current through Register Vol. 49, No. 14, July 15, 2024
PURPOSE: This proposed amendment provides for the
				  trend factor to be applied to the inpatient and outpatient adjusted net
				  revenues to determine the inpatient and outpatient net revenues subject to the
				  FRA assessment for SFY 2023. It also establishes the percentage of FRA that is
				  taxed to Missouri hospitals for SFY 2023.
(1) Federal Reimbursement Allowance (FRA).
				FRA shall be assessed as described in this section.
(A) Definitions.
1. Bad debts-Amounts considered to be
				uncollectible from accounts and notes receivable that were created or acquired
				in providing services. Allowable bad debts include the costs of caring for
				patients who have insurance, but their insurance does not cover the particular
				service procedures or treatment rendered.
2. Base year cost report-Audited Medicaid
				cost report from the third prior calendar year. If a hospital has more than one
				(1) cost report with periods ending in the third prior calendar year, the cost
				report covering a full twelve- (12-) month period will be used. If none of the
				cost reports covers a full twelve (12) months, the cost report with the latest
				period will be used. If a hospital's base year cost report is less than or
				greater than a twelve- (12-) month period, the data shall be adjusted, based on
				the number of days reflected in the base year cost report, to a twelve- (12-)
				month period. Any changes to the base year cost report after the division
				issues a final decision on assessment will not be included in the
				calculations.
3. Charity care-Those
				charges written off by a hospital based on the hospital's policy to provide
				health care services free of charge or at a reduced charge because of the
				indigence or medical indigence of the patient.
4. Contractual allowances-Difference between
				established rates for covered services and the amount paid by third-party
				payers under contractual agreements. The Federal Reimbursement Allowance (FRA)
				is a cost to the hospital, regardless of how the FRA is remitted to the MO
				HealthNet Division, and shall not be included in contractual allowances for
				determining revenues. Any redistributions of MO HealthNet payments by private
				entities acting at the request of participating health care providers shall not
				be included in contractual allowances or determining revenues or cost of
				patient care.
5.
				Department-Department of Social Services.
6. Director-Director of the Department of
				Social Services.
7. Division-MO
				HealthNet Division, Department of Social Services.
8. Engaging in the business of providing
				inpatient health care-Accepting payment for inpatient services
				rendered.
9. Federal Reimbursement
				Allowance (FRA)-The fee assessed to hospitals for the privilege of engaging in
				the business of providing inpatient health care in Missouri. The FRA is an
				allowable cost to the hospital.
10.
				Fiscal period-Twelve- (12-) month reporting period determined by each
				hospital.
11. Gross hospital
				service charges-Total charges made by the hospital for inpatient and outpatient
				hospital services that are covered under
				13 CSR
				70-15.010.
12. Hospital-A place devoted primarily to the
				maintenance and operation of facilities for the diagnosis, treatment, or care
				for not fewer than twenty-four (24) hours in any week of three (3) or more
				nonrelated individuals suffering from illness, disease, injury, deformity, or
				other abnormal physical conditions; or a place devoted primarily to provide,
				for not fewer than twenty-four (24) hours in any week, medical or nursing care
				for three (3) or more nonrelated individuals. The term hospital does not
				include convalescent, nursing, shelter, or boarding homes as defined in Chapter
				198, RSMo.
13. Hospital revenues
				subject to FRA assessment effective July 1, 2008-Each hospital's inpatient
				adjusted net revenues and outpatient adjusted net revenues subject to the FRA
				assessment will be determined as follows:
A.
				Obtain "Gross Total Charges" from Worksheet G-2, Line 25, Column 3 from CMS
				2552-96, or Worksheet G-2, Line 28, Column 3 from CMS 2552-10, of the third
				prior year cost report (i.e., FRA fiscal year cost report) for the hospital.
				Charges shall exclude revenues for physician services. Charges related to
				activities subject to the Missouri taxes assessed for outpatient retail
				pharmacies and nursing facility services shall also be excluded. "Gross Total
				Charges" will be reduced by the following:
(I)
				"Nursing Facility Charges" from Worksheet C, Part I, Line 35, Column 6 from CMS
				2552-96, or Worksheet C, Part I, Line 45, Column 6 from CMS 2552-10;
(II) "Swing Bed Nursing Facility Charges"
				from Worksheet G-2, Line 5, Column 1 from CMS 2552-96, or Worksheet G-2, Line
				6, Column 1 from CMS 2552-10;
(III)
				"Nursing Facility Ancillary Charges" as determined from the Department of
				Social Services, MO HealthNet Division, nursing home cost report. (Note: To the
				extent that the gross hospital charges, as specified in subparagraph
				(1)(A)13.A. above, include long-term care charges, the charges to be excluded
				through this step shall include all long-term care ancillary charges including
				skilled nursing facility, nursing facility, and other long-term care providers
				based at the hospital that are subject to the state's provider tax on nursing
				facility services.);
(IV) "Distinct
				Part Ambulatory Surgical Center Charges" from Worksheet G-2, Line 22, Column 2
				from CMS 2552-96, or Worksheet G-2, Line 25, Column 2 from CMS
				255210;
(V) "Ambulance Charges"
				from Worksheet C, Part I, Line 65, Column 7 from CMS 2552-96, or Worksheet C,
				Part I, Line 95, Column 7 from CMS 2552-10;
(VI) "Home Health Charges" from Worksheet
				G-2, Line 19, Column 2 from CMS 2552-96, or Worksheet G-2, Line 22, Column 2
				from CMS 2552-10;
(VII) "Total
				Rural Health Clinic Charges" from Worksheet C, Part I, Column 7, Lines
				63.50-63.59 from CMS 2552-96, or Worksheet C, Part I, Column 7, Line 88 and
				subsets from CMS 2552-10; and
(VIII) "Other Non-Hospital Component Charges"
				from Worksheet G-2, Lines 6, 8, 21, 21.02, 23, and 24 from CMS 255296, or
				Worksheet G-2, Lines 5, 7, 9, 21, 24, 26, and 27 from CMS
				2552-10;
B. Obtain "Net
				Revenue" from Worksheet G-3, Line 3, Column 1. The state will ensure this
				amount is net of bad debts and other uncollectible charges by survey
				methodology;
C. "Adjusted Gross
				Total Charges" (the result of the computations in subparagraph (1)(A)13.A.)
				will then be further adjusted by a hospital-specific collection-to-charge ratio
				determined as follows:
(I) Divide "Net
				Revenue" by "Gross Total Charges"; and
(II) "Adjusted Gross Total Charges" will be
				multiplied by the result of part (1)(A)13.C.(I) to yield "Adjusted Net
				Revenue";
D. Obtain
				"Gross Inpatient Charges" from Worksheet G-2, Line 25, Column 1 from CMS
				2552-96, or Worksheet G-2, Line 28, Column 1 from CMS 2552-10, of the most
				recent cost report that is available for a hospital;
E. Obtain "Gross Outpatient Charges" from
				Worksheet G-2, Line 25, Column 2 from CMS 2552-96, or Worksheet G-2, Line 28,
				Column 2 from CMS 2552-10, of the most recent cost report that is available for
				a hospital;
F. Total "Adjusted Net
				Revenue" will be allocated between "Net Inpatient Revenue" and "Net Outpatient
				Revenue" as follows:
(I) "Gross Inpatient
				Charges" will be divided by "Gross Total Charges";
(II) "Adjusted Net Revenue" will then be
				multiplied by the result to yield "Net Inpatient Revenue"; and
(III) The remainder will be allocated to "Net
				Outpatient Revenue"; and
G. The trend indices, if greater than 0%,
				will be determined based on the Health Care Costs index as published in
				Healthcare Cost Review by Institute of Health Systems (IHS), or equivalent
				publication, regardless of any changes in the name of the publication or
				publisher, for each state fiscal year (SFY). The trend indices listed below
				will be applied to the apportioned inpatient adjusted net revenue and
				outpatient adjusted net revenue in order to inflate or trend forward the
				adjusted net revenues from the FRA fiscal year cost report to the current state
				fiscal year to determine the inpatient and outpatient adjusted net revenues
				subject to the FRA assessment.
(I) SFY 2021 =
(a) Inpatient Adjusted Net
				Revenues-3.2%
(b) Outpatient
				Adjusted Net Revenues-0%
(II) SFY 2022 =
(a)
				Inpatient Adjusted Net Revenues-4.2%
(b) Outpatient Adjusted Net
				Revenues-0%
(III) SFY
				2023 =
(a) Inpatient Adjusted Net
				Revenues-3.8%
(b) Outpatient
				Adjusted Net Revenues-0%
(IV) SFY 2024 =
(a) Inpatient Adjusted Net
				Revenues-0%
(b) Outpatient Adjusted
				Net Revenues-0%