Mechanics of The DSH Adjustment
The formulas to establish a hospital’s Medicare DSH payment adjustment are based on the following: hospital’s location; number of beds; and status as a Rural Referral Centers, Medicare-Dependent Hospitals, or sole community provider.
The value of the hospital’s DSH "index" determines the hospital’s eligibility for a DSH payment and the size of the payment. The index, whose definition has not changed since the original legislation, is the sum of two ratios: the proportion of all Medicare days that are attributable to beneficiaries of Supplemental Security Income, a means-tested cash benefit program for aged and disabled people, and the proportion of all patient days for which Medicaid is the primary payer.
Read more about this topic: Disproportionate Share Hospital
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