Virginia Administrative Code › Title 12 - HEALTH › Agency 30 - DEPARTMENT OF MEDICAL ASSISTANCE SERVICES › Chapter 70 - METHODS AND STANDARDS FOR ESTABLISHING PAYMENT RATES - INPATIENT HOSPITAL SERVICES › Part V - Inpatient Hospital Payment System › Article 1 - Application of Payment Methodologies › Section 12VAC30-70-201 - Application of payment methodologies

Current through Register Vol. 40, No. 24, July 15, 2024
A. The state agency will pay for inpatient
					 hospital services in general acute care hospitals, rehabilitation hospitals,
					 and freestanding psychiatric facilities licensed as hospitals under a
					 prospective payment methodology. This methodology uses both per case and per
					 diem payment methods. Article 2 (12VAC30-70-221 et
					 seq.) of this part describes the prospective payment methodology, including
					 both the per case and the per diem methods.
B. Article 3 (12VAC30-70-400 et seq.) of this
					 part describes a per diem methodology that applied to a portion of payment to
					 general acute care hospitals during state fiscal years 1997 and 1998 and that
					 will continue to apply to patient stays with admission dates prior to July 1,
					 1996. Inpatient hospital services that are provided in long stay hospitals
					 shall be subject to the provisions of Supplement 3 (12VAC30-70-10 through
					 12VAC30-70-130).
C. Inpatient hospital facilities operated by
					 the Department of Behavioral Health and Developmental Services (DBHDS) shall be
					 reimbursed costs except for inpatient psychiatric services furnished under
					 early and periodic screening, diagnosis, and treatment (EPSDT) services for
					 individuals younger than age 21. These inpatient services shall be reimbursed
					 according to 12VAC30-70-415 and shall be provided according to the requirements
					 set forth in
					 12VAC30-50-130 and
					 12VAC30-60-25 H. Facilities may
					 also receive disproportionate share hospital (DSH) payments. The criteria for
					 DSH eligibility and the payment amount shall be based on subsection F of
					 12VAC30-70-50. If the DSH limit is
					 exceeded by any facility, the excess DSH payments shall be distributed to all
					 other qualifying DBHDS facilities in proportion to the amount of DSH they
					 otherwise receive.
D. Transplant
					 services shall not be subject to the provisions of this part. Reimbursement for
					 covered liver, heart, and bone marrow/stem cell transplant services and any
					 other medically necessary transplantation procedures that are determined to not
					 be experimental or investigational shall be a fee based upon the greater of a
					 prospectively determined, procedure-specific flat fee determined by the agency
					 or a prospectively determined, procedure-specific percentage of usual and
					 customary charges. The flat fee reimbursement will cover procurement costs; all
					 hospital costs from admission to discharge for the transplant procedure; and
					 total physician costs for all physicians providing services during the hospital
					 stay, including radiologists, pathologists, oncologists, surgeons, etc. The
					 flat fee reimbursement does not include pre-hospitalization and
					 post-hospitalization for the transplant procedure or pretransplant evaluation.
					 If the actual charges are lower than the fee, the agency shall reimburse the
					 actual charges. Reimbursement for approved transplant procedures that are
					 performed out of state will be made in the same manner as reimbursement for
					 transplant procedures performed in the Commonwealth. Reimbursement for covered
					 kidney and cornea transplants is at the allowed Medicaid rate. Standards for
					 coverage of organ transplant services are in
					 12VAC30-50-540 through
					 12VAC30-50-580.
E. Reduction of payments methodology.
1. For state fiscal years 2003 and 2004, the
					 Department of Medical Assistance Services (DMAS) shall reduce payments to
					 hospitals participating in the Virginia Medicaid Program by $8,935,825 total
					 funds, and $9,227,815 total funds respectively. For purposes of distribution,
					 each hospital's share of the total reduction amount shall be determined as
					 provided in this subsection.
2.
					 Determine base for revenue forecast.
a. DMAS
					 shall use, as a base for determining the payment reduction distribution for
					 hospitals Type I and Type II, net Medicaid inpatient operating reimbursement
					 and outpatient reimbursed cost, as recorded by DMAS for state fiscal year 1999
					 from each individual hospital settled cost reports. This figure is further
					 reduced by 18.73%, which represents the estimated statewide HMO average
					 percentage of Medicaid business for those hospitals engaged in HMO contracts,
					 to arrive at net baseline proportion of non-HMO hospital Medicaid
					 business.
b. For freestanding
					 psychiatric hospitals, DMAS shall use estimated Medicaid revenues for the
					 six-month period (January 1, 2001, through June 30, 2001), times two, and
					 adjusted for inflation by 4.3% for state fiscal year 2002, 3.1% for state
					 fiscal year 2003, and 3.7% for state fiscal year 2004, as reported by DRI-WEFA,
					 Inc.'s, hospital input price level percentage moving average.
3. Determine forecast revenue.
a. Each Type I hospital's individual state
					 fiscal year 2003 and 2004 forecast reimbursement is based on the proportion of
					 non-HMO business (see subdivision 2 a of this subsection) with respect to the
					 DMAS forecast of SFY 2003 and 2004 inpatient and outpatient operating revenue
					 for Type I hospitals.
b. Each Type
					 II, including freestanding psychiatric, hospital's individual state fiscal year
					 2003 and 2004 forecast reimbursement is based on the proportion of non-HMO
					 business (see subdivision 2 of this subsection) with respect to the DMAS
					 forecast of SFY 2003 and 2004 inpatient and outpatient operating revenue for
					 Type II hospitals.
4.
					 Each hospital's total yearly reduction amount is equal to its respective state
					 fiscal year 2003 and 2004 forecast reimbursement as described in subdivision 3
					 of this subsection, times 3.235857% for state fiscal year 2003, and 3.235857%,
					 for the first two quarters of state fiscal year 2004 and 2.88572% for the last
					 two quarters of state fiscal year 2004, not to be reduced by more than $500,000
					 per year.
5. Reductions shall occur
					 quarterly in four amounts as offsets to remittances. Each hospital's payment
					 reduction shall not exceed that calculated in subdivision 4 of this subsection.
					 Payment reduction offsets not covered by claims remittance by May 15, 2003, and
					 2004, will be billed by invoice to each provider with the remaining balances
					 payable by check to the Department of Medical Assistance Services before June
					 30, 2003, or 2004, as applicable.