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TITLE 1ADMINISTRATION
PART 15TEXAS HEALTH AND HUMAN SERVICES COMMISSION
CHAPTER 355REIMBURSEMENT RATES
SUBCHAPTER JPURCHASED HEALTH SERVICES
DIVISION 4MEDICAID HOSPITAL SERVICES
RULE §355.8065Disproportionate Share Hospital Reimbursement Methodology

    (A) To calculate a weight that will be applied to all non-state providers, HHSC will divide the final hospital-specific limit described in §355.8066(c)(2) of this division by the final hospital-specific limit described in §355.8066(c)(2) of this division that has not offset payments for third-party and Medicare claims and encounters where Medicaid was a secondary payer. HHSC will add 1 to the quotient. Any non-state provider that has a resulting weight of less than 1 will receive a weight of 1.

    (B) HHSC will make a first pass allocation by multiplying the weight described in subsection (p)(2)(A) of this section by the final remaining HSL calculated in the audit findings described in subsection (o) of this section. HHSC will divide the product by the total remaining HSLs for all non-state providers. HHSC will multiply the quotient by the total amount of recouped dollars available for redistribution described in subsection (p)(1) of this section.

    (C) After the first pass allocation, HHSC will cap non-state providers at its final remaining HSL. A second pass allocation will occur in the event non-state providers were paid over its final remaining HSL after the weight in subsection (p)(2)(A) of this section was applied. HHSC will calculate the second pass by dividing the final remaining HSL calculated in the audit findings described in subsection (o) of this section by the total remaining HSLs for all non-state providers after accounting for first pass payments. HHSC will multiply the quotient by the total amount of funds in excess of total HSLs for non-state providers capped at its total HSL.

(q) Advance Payments

  (1) In a DSH program year in which payments will be delayed pending data submission or for other reasons, HHSC may make advance payments to hospitals that meet the eligibility requirements described in subsection (c) of this section, meet a qualification in subsection (d) of this section, meet the conditions of participation in subsection (e) of this section, and submitted an acceptable disproportionate share hospital application for the preceding DSH program year from which HHSC calculated an annual maximum disproportionate share hospital payment amount for that year.

  (2) Advance payments are considered to be prior period payments.

  (3) A hospital that did not submit an acceptable disproportionate share hospital application for the preceding DSH program year is not eligible for an advance payment.

  (4) If a partial year disproportionate share hospital application was used to determine the preceding DSH program year's payments, data from that application may be annualized for use in computation of an advance payment amount.

  (5) The amount of the advance payments:

    (A) are divided into three payments prior to a hospital receiving its final DSH payment amount;

    (B) in DSH program years 2020 and after a provider that received a payment in the previous DSH program year is eligible to receive an advanced payment, and the calculations for advanced payment 1, 2, and 3 are as follows:

      (i) HHSC determines a percentage of the pool to pay out in the advanced payments; and

      (ii) the pool amount is fed through the previous DSH program year calculation to determine the advanced payments;

    (C) in DSH program year 2024, HHSC will run the application data for hospital applications through an updated DSH qualification and calculation file to determine advanced payment eligibility and amount to account for rule changes between program year 2023 and 2024 to prevent recoupments; and

    (D) HHSC will determine the payment allocation for the advances for 2025 and subsequent years by calculating a percentage based on a hospital's payment in the preceding year divided by the sum of all other hospitals' payment in the preceding year that are eligible for an advance payment.


Source Note: The provisions of this §355.8065 adopted to be effective September 1, 2009, 34 TexReg 5662; amended to be effective August 22, 2010, 35 TexReg 7035; amended to be effective October 1, 2011, 36 TexReg 6146; amended to be effective September 19, 2012, 37 TexReg 7273; amended to be effective September 11, 2013, 38 TexReg 5859; amended to be effective September 1, 2014, 39 TexReg 6407; amended to be effective May 3, 2015, 40 TexReg 2259; amended to be effective June 25, 2019, 44 TexReg 3091; amended to be effective February 1, 2020, 45 TexReg 525; amended to be effective June 28,2021,46 TexReg 3857; amended to be effective June 20, 2023, 48 TexReg 3187

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