Medicaid Program; Final FY 2018, Final FY 2019, Preliminary FY 2020, and Preliminary FY 2021 Disproportionate Share Hospital Allotments, and Final FY 2018, Final FY 2019, Preliminary FY 2020, and Preliminary FY 2021 Institutions for Mental Diseases Disproportionate Share Hospital Limits
| Published date | 16 March 2022 |
| Citation | 87 FR 14858 |
| Record Number | 2022-05459 |
| Section | Notices |
| Court | Centers For Medicare & Medicaid Services |
Federal Register, Volume 87 Issue 51 (Wednesday, March 16, 2022)
[Federal Register Volume 87, Number 51 (Wednesday, March 16, 2022)]
[Notices]
[Pages 14858-14888]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2022-05459]
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DEPARTMENT OF HEALTH AND HUMAN SERVICES
Centers for Medicare & Medicaid Services
[CMS-2436-N]
RIN 0938-ZB62
Medicaid Program; Final FY 2018, Final FY 2019, Preliminary FY
2020, and Preliminary FY 2021 Disproportionate Share Hospital
Allotments, and Final FY 2018, Final FY 2019, Preliminary FY 2020, and
Preliminary FY 2021 Institutions for Mental Diseases Disproportionate
Share Hospital Limits
AGENCY: Centers for Medicare & Medicaid Services (CMS), Department of
Health and Human Services (HHS).
ACTION: Notice.
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SUMMARY: This notice announces the final Federal share (FS)
disproportionate share hospital (DSH) allotments for Federal fiscal
year (FY) 2018 and FY 2019, and the preliminary FS DSH allotments for
FY 2020 and FY 2021. This notice also announces the final FY 2018 and
FY 2019 and the preliminary FY 2020 and FY 2021 limitations on
aggregate DSH payments that States may make to institutions for mental
disease and other mental health facilities. In addition, this notice
includes background information describing the methodology for
determining the amounts of States' FY DSH allotments.
DATES: The allotments announced in this notice are effective April 15,
2022. The final allotments and limitations set forth in this notice are
applicable for the fiscal years specified.
FOR FURTHER INFORMATION CONTACT: Stuart Goldstein, (410) 786-0694 and
Richard Cuno, (410) 786-1111.
SUPPLEMENTARY INFORMATION:
I. Background
A. Fiscal Year DSH Allotments
A State's Federal fiscal year (FY) disproportionate share hospital
(DSH) allotment represents the aggregate limit on the Federal share
(FS) amount of the State's DSH payments to DSH hospitals in the State
for the FY. The amount of such allotment is determined in accordance
with the provisions of section 1923(f) of the Social Security Act (the
Act), with some State-specific exceptions as specified in section
1923(f) of the Act. Under such provisions, in general, a State's FY DSH
allotment is calculated by increasing the amount of its DSH allotment
for the preceding FY by the percentage change in the Consumer Price
Index for all Urban Consumers (CPI-U) for the previous FY.
The Patient Protection and Affordable Care Act of 2010 (Pub. L.
111-148), as amended by the Health Care and Education Reconciliation
Act of 2010 (Pub. L. 111-152) (collectively, the Affordable Care Act),
amended Medicaid DSH provisions, adding section 1923(f)(7) of the Act.
Section 1923(f)(7) of the Act would have required reductions to States'
FY DSH allotments from FY 2014 through FY 2020, the calculation of
which was described in the Disproportionate Share Hospital Payment
Reduction final rule published in the September 18, 2013 Federal
Register (78 FR 57293). Subsequent legislation, most recently the
Consolidated Appropriations Act, 2021 (Pub. L. 116-260, enacted
December 27, 2020), delayed the start of these reductions until FY
2024. The final rule delineating a revised methodology for the
calculation of DSH allotment reductions beginning in 2020 (subsequently
delayed by further statutory enactment) was published in the September
25, 2019 Federal Register (84 FR 50308).
Because there are no reductions to DSH allotments for FY 2018
through FY 2023 under section 1923(f)(7) of the Act, as amended, this
notice contains only the State-specific final FY 2018 and FY 2019 DSH
allotments and preliminary FY 2020 and FY 2021 DSH allotments, as
calculated under the statute without application of the reductions that
would have been imposed beginning as early as FY 2014 under prior
versions of section 1923(f)(7) of the Act. This notice also provides
information on the calculation of the FY DSH allotments, the
calculation of the States' institution for mental diseases (IMD) DSH
limits, and the amounts of States' final FY 2018 and FY 2019 IMD DSH
limits and preliminary FY 2020 and FY 2021 IMD DSH limits.
B. Determination of Fiscal Year DSH Allotments
Generally, in accordance with the methodology specified under
section 1923(f)(3) of the Act, a State's FY DSH allotment is calculated
by increasing the amount of its DSH allotment for the preceding FY by
the percentage change in the CPI-U for the previous FY. Also, in
accordance with section 1923(f)(3) of
[[Page 14859]]
the Act, a State's DSH allotment for a FY is subject to the limitation
that an increase to a State's DSH allotment for a FY cannot result in
the DSH allotment exceeding the greater of the State's DSH allotment
for the previous FY or 12 percent of the State's total medical
assistance expenditures for the allotment year (this is referred to as
the 12 percent limit).
Furthermore, under section 1923(h) of the Act, Federal financial
participation (FFP) for DSH payments to IMDs and other mental health
facilities is limited to State-specific aggregate amounts. Under this
provision, the aggregate limit for DSH payments to IMDs and other
mental health facilities is the lesser of a State's FY 1995 total
computable (State and FS) IMD and other mental health facility DSH
expenditures applicable to the State's FY 1995 DSH allotment (as
reported on the Form CMS-64 as of January 1, 1997), or the amount equal
to the product of the State's current year total computable DSH
allotment and the applicable percentage specified in section 1923(h) of
the Act.
C. Determination of Fiscal Year DSH Allotments for FY 2020 and FY 2021
The Families First Coronavirus Response Act's (FFCRA) (Pub. L. 116-
127, enacted March 18, 2020) temporary Federal medical assistance
percentage (FMAP) increase of 6.2 percentage points went into effect on
January 1, 2020 for eligible States, as provided in section 6008 of the
FFCRA. As relevant to this notice, this FMAP increase applies to
eligible Medicaid expenditures including DSH payments for FY 2020 (with
the exception of the 1st quarter, from October 1, 2019 through December
31, 2019), and FY 2021, and all States currently are receiving the
temporary FFCRA FMAP increase. For States that exhaust their entire DSH
allotment, the FFCRA FMAP increase would effectively reduce the amount
of total computable (TC) DSH payments that such States could pay to
qualifying providers.
To avoid this reduction in TC DSH allotments, section 9819 of the
American Rescue Plan Act of 2021 (ARP) (Pub. L. 117-2, enacted March
11, 2021) added section 1923(f)(3)(F) of the Act, adjusting FS DSH
allotments during periods when and for States where the temporary 6.2
percentage point FMAP increase under section 6008 of the FFCRA is in
effect. As directed by the ARP, we are required to recalculate FS DSH
allotments to an amount that will allow States to make the same amount
of TC DSH payments as they would have been otherwise able to make in
the absence of the FFCRA FMAP increase.
In accordance with section 1923(f)(3)(B) of the Act, a State's DSH
allotment for a FY is subject to the limitation that an increase to a
State's DSH allotment for a FY cannot result in the DSH allotment
exceeding the greater of the State's DSH allotment for the previous FY
or 12 percent of the State's total medical assistance expenditures for
the allotment year. Because States incur medical assistance
expenditures throughout the fiscal year, the calculations for the 12
percent limit under section 1923(f)(3)(B)(ii) of the Act were performed
using a prorated FMAP for FY 2020. To arrive at the stated limits, we
prorated each State's FY 2020 FMAP rate because the temporary 6.2
percentage point FMAP increase under section 6008 of the FFCRA does not
apply to the 1st quarter of FY 2020. For the calculation of the 12
percent limit for FY 2021, we used the FFCRA FMAP rate (that is, the
otherwise applicable FMAP rate plus the temporary 6.2 percentage point
FFCRA FMAP increase), because the FFCRA FMAP rate applies to the entire
FY for qualifying States, and medical assistance expenditures are made
throughout the year.
Section 1923(f)(3)(F)(i) of the Act requires us to recalculate the
annual DSH allotment, including the DSH allotment specified under
paragraph (6)(A)(vi), to ensure that the total DSH payments (including
both Federal and State shares) that a State may make related to a
fiscal year is equal to the total DSH payments that the State could
have made for such fiscal year without such FMAP increase. To meet the
statutory requirement to enable States to make the same amount of TC
DSH payments as if the FFCRA FMAP increase were not in effect, we have
used the full (non-prorated) FFCRA-increased FMAP rate in the
calculation of the increased FY 2020 and FY 2021 FS DSH allotments. We
used the full FFCRA-increased FMAP rate rather than a prorated FMAP
rate for the FY 2020 calculation, despite it not being applicable to
the 1st quarter of FY 2020, to ensure this provision applies to all
States consistent with the statutory requirement, including a State
that made all DSH payments for FY 2020 in quarters other than the first
fiscal quarter of that fiscal year.
While States have distinct payment methodologies that specify when
DSH payments are made to providers, States may not claim TC DSH
payments in excess of the amount they would have otherwise been able to
claim without the application of the temporary 6.2 percentage point
FFCRA FMAP rate increase. This is regardless of whether a portion of
unspent FS DSH allotment as adjusted to account for section
1923(f)(3)(F) of the Act, as added by section 9819 of the ARP, remains.
For example, if the State made all DSH payments for FY 2020 during the
first quarter of that FY, then no increase to the State's DSH allotment
is available for that year, since the temporary 6.2 percentage point
FMAP increase under section 6008 of the FFCRA was not available for
that quarter and section 1923(f)(3)(F) therefore has no effect. We will
monitor both the FS and TC DSH allotments to ensure that States do not
exceed statutory authority to claim DSH payments. Consistent with
previous guidance by CMS during the public health emergency, States
should follow existing Federal requirements regarding the applicability
of a particular match rate available for a given quarter, including
reporting prior period adjustments.
For calculation of the FY 2020 and FY 2021 IMD limits determined
under section 1923(h) of the Act, we used the ARP-adjusted DSH
allotments and the associated non-prorated FFCRA-increased FMAP rates
for FY 2020 and FY 2021, to reflect the maximum DSH allotment amount
and IMD limit that might be available to a State, for FY 2020,
depending on the State's timing of DSH payments.
In general, we determine States' DSH allotments for a FY and the
IMD DSH limits for the same FY using the most recent available
estimates of or actual medical assistance expenditures, including DSH
expenditures and the most recent available CPI-U data for the FY in
accordance with the methodology prescribed in the statute. The
indicated estimated or actual expenditures are obtained from States for
each relevant FY from the most recent available quarterly Medicaid
budget reports (Form CMS-37) or quarterly Medicaid expenditure reports
(Form CMS-64), respectively, submitted by the States. For example, as
part of the initial determination of a State's FY DSH allotment
(referred to as the preliminary DSH allotments) that is determined
before the beginning of the FY for which the DSH allotments and IMD DSH
limits are being determined, we use estimated expenditures for the FY
obtained from the August submission of the CMS-37 submitted by States
prior to the beginning of the FY; such estimated expenditures are
subject to update and revision during the FY before actual expenditure
data become available. We also use the most recent available estimated
CPI-U percentage change that
[[Page 14860]]
is available before the beginning of the FY for determining the States'
preliminary FY DSH allotments; such estimated CPI-U percentage change
is subject to update and revision during the FY before the actual CPI-U
percentage change becomes available. In determining the final DSH
allotments and IMD DSH limits for a FY we use the actual expenditures
for the FY and actual CPI-U percentage change for the previous FY.
II. Provisions of the Notice
A. Calculation of the Final FY 2018 and FY 2019 FS State DSH Allotments
and the Preliminary FY 2020 and FY 2021 FS State DSH Allotments
1. Final FY 2018 FS State DSH Allotments
Addendum 1 to this notice provides the States' final FY 2018 DSH
allotments determined in accordance with section 1923(f)(3) of the Act.
As described in the background section, in general, the DSH allotment
for a FY is calculated by increasing the FY DSH allotment for the
preceding FY by the CPI-U increase for the previous fiscal year. For
purposes of calculating the States' final FY 2018 DSH allotments, the
preceding final fiscal year DSH allotments (for FY 2017) were published
in the February 11, 2019 Federal Register (84 FR 3169). For purposes of
calculating the States' final FY 2018 DSH allotments we are using the
actual Medicaid expenditures for FY 2018. Finally, for purposes of
calculating the States' final FY 2018 DSH allotments, the applicable
historical percentage change in the CPI-U for the previous FY (FY 2017)
was 2.1 percent; we note that this is lower than the estimated 2.4
percentage change in the CPI-U for FY 2017 that was available and used
in the calculation of the preliminary FY 2018 DSH allotments which were
published in the July 6, 2018 Federal Register (83 FR 31536).
2. Final FY 2019 FS State DSH Allotments
Addendum 2 to this notice provides the States' final FY 2019 DSH
allotments determined in accordance with section 1923(f)(3) of the Act.
As described in the background section, in general, the DSH allotment
for a FY is calculated by increasing the FY DSH allotment for the
preceding FY by the CPI-U increase for the previous fiscal year. For
purposes of calculating the States' final FY 2019 DSH allotments, the
preceding final fiscal year DSH allotments (for FY 2018) are being
published in this notice. For purposes of calculating the States' final
FY 2019 DSH allotments we are using the actual Medicaid expenditures
for FY 2019. Finally, for purposes of calculating the States' final FY
2019 DSH allotments, the applicable historical percentage change in the
CPI-U for the previous FY (FY 2018) was 2.4 percent; we note that this
is the same as the estimated 2.4 percentage change in the CPI-U for FY
2018 that was available and used in the calculation of the preliminary
FY 2019 DSH allotments which were published in the February 11, 2019
Federal Register (84 FR 3169).
3. Calculation of the Preliminary FY 2020 FS State DSH Allotments
Addendum 3 to this notice provides the preliminary FY 2020 DSH
allotments determined in accordance with section 1923(f)(3) of the Act.
The preliminary FY 2020 DSH allotments contained in this notice were
determined based on the most recent available estimates from States of
their FY 2020 total computable Medicaid expenditures and by increasing
the preliminary FY 2019 DSH allotments. The applicable historical
percentage change in the CPI-U for FY 2019 was 1.9 percent (we
originally published the preliminary FY 2019 DSH allotments in the
February 11, 2019 Federal Register (84 FR 3169)). We then used each
State's FS DSH allotment divided by its respective regular FMAP rate in
order to determine the TC amount of DSH payments each State would have
otherwise been able to make without application of the FFCRA-increased
FMAP rate. We then multiplied each State's TC DSH payment amount by its
respective FFCRA-increased FMAP rate in order to calculate the
increased FY 2020 DSH allotment.
We will publish States' final FY 2020 DSH allotments in a future
notice based on the States' four quarterly Medicaid expenditure reports
(Form CMS-64) for FY 2020 available following the end of FY 2020
utilizing the actual change in the CPI-U for FY 2019.
4. Calculation of the Preliminary FY 2021 FS State DSH Allotments
Addendum 4 to this notice provides the preliminary FY 2021 DSH
allotments determined in accordance with section 1923(f)(3) of the Act.
The preliminary FY 2021 DSH allotments contained in this notice were
determined based on the most recent available estimates from States of
their FY 2021 total computable Medicaid expenditures and by increasing
the preliminary FY 2020 DSH allotments calculated prior to the
application of the ARP adjustment. The applicable historical percentage
change in the CPI-U for FY 2020 was 1.5 percent (we are publishing the
preliminary FY 2020 DSH allotments in this notice). We then used each
State's FS DSH allotment divided by its respective regular FMAP rate in
order to determine the TC amount of DSH payments each State would have
otherwise been able to make without application of the FFCRA-increased
FMAP rate. We then multiplied each State's TC DSH payment amount by its
respective FFCRA-increased FMAP rate in order to calculate the ARP-
adjusted FY 2021 DSH allotment.
We will publish States' final FY 2021 DSH allotments in a future
notice based on the States' four quarterly Medicaid expenditure reports
(Form CMS-64) for FY 2021 available following the end of FY 2021.
B. Calculation of the Final FY 2018 and FY 2019 and Preliminary FY 2020
and FY 2021 IMD DSH Limits
Section 1923(h) of the Act specifies the methodology to be used to
establish the limits on the amount of DSH payments that a State can
make to IMDs and other mental health facilities. FFP is not available
for DSH payments to IMDs or other mental health facilities that exceed
the IMD DSH limits. In this notice, we are publishing the final FY 2018
and FY 2019 and the preliminary FY 2020 and FY 2021 IMD DSH limits
determined in accordance with the provisions discussed above.
Addendums 5 through 8 to this notice detail each State's final FY
2018 and FY 2019 and preliminary FY 2020 and FY 2021 IMD DSH limits,
respectively, determined in accordance with section 1923(h) of the Act.
III. Collection of Information Requirements
As it relates to the Paperwork Reduction Act of 1995 (PRA; 44
U.S.C. 3501 et seq.), this notice does not impose any new or revised
``collection of information'' requirements or burden. With respect to
the PRA and this section of the preamble, collection of information is
defined under 5 CFR 1320.3(c) of the PRA's implementing regulations.
While discussed in sections I.B., I.C., II.A.3., II.A.4., and in
Addendums 3 through 8 of this notice, the requirements and burden
associated with form CMS-37 and form CMS-64 are unaffected by this
notice. Both forms are approved by the Office of Management and Budget
(OMB) under control number 0938-1265, which expires on April 30, 2024.
Since this notice will not impose any new or revised collection of
information requirements/burden, we are not
[[Page 14861]]
making any changes under that control number.
IV. Regulatory Impact Analysis
We have examined the impact of this notice as required by Executive
Order 12866 on Regulatory Planning and Review (September 1993), the
Regulatory Flexibility Act (RFA) (September 19, 1980, Pub. L. 96-354),
section 1102(b) of the Act, section 202 of the Unfunded Mandates Reform
Act of 1995 (Pub. L. 104-4; enacted on March 22, 1995) (UMRA `95),
Executive Order 13132 on Federalism (August 4, 1999) and the
Congressional Review Act (5 U.S.C. 804(2)).
Executive Order 12866 directs agencies to assess all costs and
benefits of available regulatory alternatives and, if regulation is
necessary, to select regulatory approaches that maximize net benefits
(including potential economic, environmental, public health and safety
effects, distributive impacts, and equity). A regulatory impact
analysis (RIA) must be prepared for major rules with economically
significant effects ($100 million or more in any 1 year). This notice
reaches the $100 million economic threshold and thus has been
designated a major rule under the Congressional Review Act by the
Office of Information and Regulatory Affairs.
The final FY 2018 DSH allotments being published in this notice are
$36 million less than the preliminary FY 2018 DSH allotments published
in the July 6, 2018 Federal Register (83 FR 31536). This is due to the
actual percentage change in the CPI-U for FY 2017 used in the
calculation of the final FY 2018 allotments (2.1 percent) being less
than the estimated percentage change in the CPI-U for FY 2017 used in
the calculation of the preliminary FY 2018 allotments (2.4 percent).
The final FY 2018 IMD DSH limits being published in this notice are
$2.4 million less than the preliminary FY 2018 IMD DSH limits published
in the July 6, 2018 Federal Register (83 FR 31536). Since the final FY
2018 DSH allotments were less than the preliminary FY 2018 DSH
allotments, the associated FY 2018 IMD DSH limits also decreased.
The final FY 2019 DSH allotments being published in this notice are
$36 million less than the preliminary FY 2019 DSH allotments published
in the February 11, 2019 Federal Register (84 FR 3169). The decrease in
the final FY 2019 DSH allotments is a result of being calculated by
multiplying the actual increase in the CPI-U for 2018 by the final FY
2018 DSH allotments, while the preliminary FY 2019 DSH allotments were
calculated by multiplying the estimated CPI-U for 2018 by the
preliminary FY 2018 DSH allotments. Although the estimated and actual
increase in the CPI-U remained the same at 2.4 percent, the preliminary
FY 2018 DSH allotments were higher than the final FY 2018 DSH
allotments and therefore the final FY 2019 DSH allotments are lower
than the preliminary FY 2019 DSH allotments. The final FY 2019 IMD DSH
limits being published in this notice are approximately $2 million
lower than the preliminary FY 2019 IMD DSH limits published in the
February 11, 2019 Federal Register (84 FR 3169). The decreases in the
IMD DSH limits are because the DSH allotment for a FY is a factor in
the determination of the IMD DSH limit for the FY. Since the final FY
2019 DSH allotments were decreased as compared to the preliminary FY
2019 DSH allotments, the associated FY 2019 IMD DSH limits for some
States were also decreased. This is a result of statutory provision,
discussed above, that the aggregate limit for DSH payments to IMDs and
other mental health facilities is the lesser of a State's FY 1995 total
computable IMD and other mental health facility DSH expenditures
applicable to the State's FY 1995 DSH allotment or the amount equal to
the product of the State's current year total computable DSH allotment
and the applicable percentage specified in section 1923(h) of the Act.
As a result of the final FY 2019 DSH allotments decreasing from the
preliminary FY 2019 DSH allotments, States that had applicable
percentages of their current year's total computable DSH allotments
lower than FY 1995 total computable IMD and other mental health
facility DSH expenditures had their IMD limits decreased as a result.
The preliminary FY 2020 DSH allotments being published in this
notice have been increased by approximately $1.6 billion more than the
preliminary FY 2019 DSH allotments published in the February 11, 2019
Federal Register (84 FR 3169). The increase in the DSH allotments is
due to the application of the statutory formula for calculating DSH
allotments under which the prior fiscal year allotments are increased
by the percentage increase in the CPI-U for the prior fiscal year, and
to the ARP adjustment, as discussed in more detail in the next
paragraph. The preliminary FY 2020 IMD DSH limits being published in
this notice are approximately $246 million more than the preliminary FY
2019 IMD DSH limits published in the February 11, 2019 Federal Register
(84 FR 3169). The increases in the IMD DSH limits are because the DSH
allotment for a FY is a factor in the determination of the IMD DSH
limit for the FY. Since the preliminary FY 2020 DSH allotments are
greater than the preliminary FY 2019 DSH allotments, the associated
preliminary FY 2020 IMD DSH limits for some States also increased.
The preliminary FY 2020 DSH allotments (before application of the
ARP adjustment) being published in this in this notice are
approximately $238 million more than the final FY 2019 DSH allotments
being published in this notice. This increase is attributable to the
application of the statutory formula for calculating DSH allotments
under which the prior fiscal year allotments are increased by the
percentage increase in the CPI-U for the prior fiscal year. The
applicable historical percentage change in the CPI-U for FY 2019 was
1.9 percent. The preliminary FY 2020 DSH allotments were further
increased by approximately $1.4 billion in order to comply with the
statutory provisions of the ARP requiring us to recalculate FS DSH
allotments to an amount that will allow States to make the same amount
of TC DSH payments as they would have been otherwise able to make in
the absence of the FFCRA FMAP increase.
The preliminary FY 2021 DSH allotments (before application of the
ARP adjustment) being published in this notice are approximately $192
million more than the preliminary FY 2020 DSH allotments published in
this notice. The increase in the DSH allotments is due to the
application of the statutory formula for calculating DSH allotments
under which the prior fiscal year allotments are increased by the
percentage increase in the CPI-U for the prior fiscal year. The
applicable historical percentage change in the CPI-U for FY 2020 was
1.5 percent. The preliminary FY 2020 DSH allotments were increased by
approximately $1.4 billion in order to comply with the statutory
provisions of the ARP requiring us to recalculate FS DSH allotments to
an amount that will allow States to make the same amount of TC DSH
payments as they would have been otherwise able to make in the absence
of the FFCRA FMAP increase. The preliminary FY 2021 DSH allotments were
further increased by approximately $1.4 billion in order to comply with
the statutory provisions of the ARP requiring us to recalculate FS DSH
allotments to an amount that will allow States to make the same amount
of TC DSH payments as they would have been otherwise able to make in
the absence of the FFCRA FMAP increase.
[[Page 14862]]
The preliminary FY 2021 IMD DSH limits being published in this
notice are approximately $16 million more than the preliminary FY 2020
IMD DSH limits published in this notice. The increases in the IMD DSH
limits are because the DSH allotment for a FY is a factor in the
determination of the IMD DSH limit for the FY. Since the preliminary FY
2021 DSH allotments are greater than the preliminary FY 2020 DSH
allotments, the associated preliminary FY 2021 IMD DSH limits for some
States also increased.
The RFA requires agencies to analyze options for regulatory relief
of small businesses, if a rule has a significant impact on a
substantial number of small entities. For purposes of the RFA, small
entities include small businesses, nonprofit organizations, and small
governmental jurisdictions. Most hospitals and most other providers and
suppliers are small entities, either by nonprofit status or by having
revenues of less than $8.0 million to $41.5 million in any one year.
Individuals and States are not included in the definition of a small
entity. We are not preparing an analysis for the RFA because the
Secretary has determined that this notice will not have significant
economic impact on a substantial number of small entities.
Specifically, any impact on providers is due to the effect of the
various controlling statutes; providers are not impacted as a result of
the independent regulatory action in publishing this notice. The
purpose of the notice is to announce the latest DSH allotments and IMD
DSH limits, as required by the statute.
In addition, section 1102(b) of the Act requires us to prepare a
regulatory impact analysis if a rule may have a significant impact on
the operations of a substantial number of small rural hospitals. This
analysis must conform to the provisions of section 604 of the RFA. For
purposes of section 1102(b) of the Act, we define a small rural
hospital as a hospital that is located outside of a Core-Based
Statistical Area for Medicaid payment regulations and has fewer than
100 beds. We are not preparing analysis for section 1102(b) of the Act
because the Secretary has determined that this notice will not have a
significant impact on the operations of a substantial number of small
rural hospitals.
The Medicaid statute specifies the methodology for determining the
amounts of States' DSH allotments and IMD DSH limits; and as described
previously, the application of the methodology specified in statute
results in the decreases or increases in States' DSH allotments and IMD
DSH limits for the applicable FYs. The statute applicable to these
allotments and limits does not apply to the determination of the
amounts of DSH payments made to specific DSH hospitals; rather, these
allotments and limits represent an overall limit on the total of such
DSH payments. For this reason, we do not believe that this notice will
have a significant economic impact on a substantial number of small
entities.
Section 202 of the Unfunded Mandates Reform Act of 1995 also
requires that agencies assess anticipated costs and benefits before
issuing any rule whose mandates require spending in any 1 year of $100
million in 1995 dollars, updated annually for inflation. In 2021, that
threshold is approximately $158 million. This notice will have no
consequential effect on spending by State, local, or tribal
governments, in the aggregate, or on the private sector.
Executive Order 13132 establishes certain requirements that an
agency must meet when it issues a proposed rule (and subsequent final
rule) that imposes substantial direct requirement costs on State and
local governments, preempts State law, or otherwise has Federalism
implications. Since this notice does not impose any costs on State or
local governments or otherwise have Federalism implications, the
requirements of E.O. 13132 are not applicable.
A. Alternatives Considered
Because the FFCRA temporary FMAP increase of 6.2 percentage points
was not applicable to the 1st quarter of FY 2020, we considered
utilizing prorated FMAP rates in the calculation of the ARP-adjusted FY
2020 DSH allotments. However, this could have been contrary to the
statutory language at section 1923(f)(3)(F) of the Act requiring us to
recalculate FS DSH allotments to an amount to allow for States to make
the same amount of TC DSH payments as they would have been otherwise
able to make in the absence of the FFCRA FMAP increase, depending on
States' timing of their DSH payments to eligible providers. The
methodologies for determining the States' fiscal year DSH allotments
and IMD DSH limits, as reflected in this notice, were established in
accordance with the methodologies and formula for determining States'
allotments and limits as specified in statute. This notice does not put
forward any further discretionary administrative policies for
determining such allotments and limits, or otherwise.
B. Accounting Statement
As required by OMB Circular A-4 (available at https://obamawhitehouse.archives.gov/omb/circulars_a004_a-4/), in Tables 1 and
2, we have prepared an accounting statement showing the classification
of the estimated expenditures associated with the provisions of this
notice. Table 1 provides our best estimate of the change (decrease) in
the FS of States' Medicaid DSH payments resulting from the application
of the provisions of the Medicaid statute relating to the calculation
of States' FY DSH allotments and the increase in the FY DSH allotments
from FY 2019 to FY 2020. Table 2 provides our best estimate of the
change (decrease) in the FS of States' Medicaid DSH payments resulting
from the application of the provisions of the Medicaid statute relating
to the calculation of States' FY DSH allotments and the increase in the
FY DSH allotments from FY 2020 to FY 2021.
Table 1--Accounting Statement: Classification of Estimated Expenditures,
From the FY 2019 to FY 2020
[In millions]
------------------------------------------------------------------------
Category Transfers
------------------------------------------------------------------------
Annualized Monetized Transfers............ $238.
From Whom To Whom? Federal Government to
States.
------------------------------------------------------------------------
Table 2--Accounting Statement: Classification of Estimated Expenditures,
From the FY 2020 to FY 2021
[In millions]
------------------------------------------------------------------------
Category Transfers
------------------------------------------------------------------------
Annualized Monetized Transfers............ $192.
From Whom To Whom? Federal Government to
States.
------------------------------------------------------------------------
C. Congressional Review Act
This document is subject to the Congressional Review Act provisions
of the Small Business Regulatory Enforcement Fairness Act of 1996 (5
U.S.C. 801 et seq.) and has been transmitted to the Congress and the
Comptroller General for review.
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In accordance with the provisions of Executive Order 12866, this
notice was reviewed by the Office of Management and Budget.
Chiquita Brooks-LaSure, Administrator of the Centers for Medicare &
Medicaid Services, approved this document on February 1, 2022.
Dated: March 9, 2022.
Xavier Becerra,
Secretary, Department of Health and Human Services.
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[FR Doc. 2022-05459 Filed 3-14-22; 4:15 pm]
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