The Medicaid disproportionate share hospital program is a federal-state program that awards safety-net hospitals with supplemental payments. Medicaid DSH funds, however, may not exceed the hospitals’ uncompensated care costs for services provided to Medicaid and uninsured patients in a given year.
In 2007, New Jersey overpaid three hospitals — Raritan Bay Medical Center in Perth Amboy, Jersey City Medical Center and Capital Health Regional Medical Center in Trenton — and a home health facility, Mount Carmel Guild in Trenton. JCMC received $94.9 million in Medicaid DSH funds that year, which was $38.8 million above its hospital-specific limit for uncompensated care. Mount Carmel Guild and Capital Health were overpaid $3.8 million and $1.3 million, respectively, while RBMC received $10,206 more than its limit. In all, the overpayments amounted to a shade more than $44 million.
The OIG said the overpayments occurred because New Jersey officials “had not established procedures for reconciling and adjusting DSH payments to hospital-specific limits.” The agency said New Jersey should refund the federal government’s share of the overpayments, which equal $22 million, and improve its Medicaid DSH program.
New Jersey officials argued it should not have to repay the funds after they provided additional information explaining how and why it made the original payments. However, the OIG stood by its findings.
More Articles on Medicaid DSH Payments:
Obama’s Budget for 2015: 10 Points for Hospitals Know
CMS Announces 2014 Funding for Medicaid Disproportionate Share Hospitals
Georgia Hospital CFO: Loss of DSH Payments Will Sting
