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FFY 2019 Uncompensated Care Payments to Come From 2014, 2015 Worksheet S-10 Data

Worksheet S-10 audits have begun for select hospitals

In the federal fiscal year (FFY) 2019 inpatient prospective payment system final rule, the Centers for Medicare & Medicaid Services (CMS) finalized its second year of a three-year transition to use Worksheet S-10 data for distributing Medicare disproportionate share hospital (DSH) uncompensated care payments. CMS will use two years (FFYs 2014 and 2015) of Worksheet S-10 cost report data and one year of proxy data to distribute the uncompensated care payments for FFY 2019.

In response to comments from CHA, CMS noted in the final rule that it planned audits of the data in fall 2018. In late August, CMS began audits of selected hospitals’ FFY 2015 cost reports. A number of hospitals in California have received this data request, and must respond by Sept. 28.  

Because CMS has given the Medicare administrative contractors (MACs) only until the end of January to complete the audits, providers have a short timeline to complete this work with their MACs. Though CHA acknowledges that this presents a challenge from both technical and resource perspectives, CHA highly encourages hospitals that have received a request to respond as quickly as possible. Early communication with Noridian (or its subcontractor, Figliozzi & Company) is critical under this short timeline. A copy of the letter Noridian sent to select providers requesting documentation is attached; these letters are consistent across all MACs.

Toyon Associates, on CHA’s behalf, recently conducted an analysis of the June Health Care Provider Cost Report Information System files for FFY 2014, 2015 and 2016 Medicare cost reports. This analysis demonstrates the continued need to audit Worksheet S-10 data to ensure they are reliable and valid for purposes of payment. CHA recommends that hospitals review the Toyon analysis, along with their most recently identified cost reports, to determine whether they need to make additional changes for future years. CHA anticipates that any adjustments made through the audit process will affect FFY 2020 Medicare DSH uncompensated care payments, and that CMS will continue to audit Worksheet S-10 data for future years.      

In the final rule, CMS noted that it will continue to work with stakeholders — through provider education and further refinement of the instructions for the Worksheet S-10 — to address concerns over reported data accuracy and consistency. CHA is committed to working with CMS on this effort. In addition, CHA is working with Noridian and its subcontractor to help ensure shared understanding of expectations related to the data request and subsequent audit. CHA will reconvene its Medicare DSH workgroup to identify opportunities in which CHA can promote clarity in the process and offer solutions to problems that may arise. CHA is collecting information from the field in an effort to help CMS standardize the process going forward. To review CHA’s Worksheet S-10 resources, visit www.calhospital.org/s-10.