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HHS ordered to recalculate hospitals' Medicare DSH payments

January 8, 2013

The U.S. District Court for the District of Columbia last week ordered the Department of Health and Human Services to recalculate certain Medicare disproportionate share payments for more than 100 hospitals and pay interest on any additional amounts owed. U.S. District Judge Emmet Sullivan vacated and remanded the two combined cases back to the HHS secretary for further proceedings consistent with the D.C. Circuit Court's 2011 opinion in Northeast Hospital Corp. v. Sebelius, which held that HHS' decision to exclude Medicare Advantage patient days from the Medicaid fraction of the DSH calculation prior to Oct. 1, 2004 violates the rule against retroactive rulemaking.