Hospital Services: Definitions

01. Administratively Necessary Day (AND). An Administratively Necessary Day (AND) is covered for an orderly transfer or discharge of participant inpatients who are no longer in need of a continued acute level of care. ANDs may be authorized for inpatients who are awaiting placement for NF level of care, or in-home services that are not available, or when catastrophic events prevent the scheduled discharge of an inpatient. (7-1-26) 02. All-Patient Refined Diagnosis Related Group (APR-DRG). A payment methodology outlined in the Medicaid Provider Agreement. (7-1-26) 03. Allowable Costs. The current year's Medicaid apportionment of a hospital's allowable costs determined at final or interim settlement if cost settlements are applicable or determined using the version of the cost report used for prospective payment system (PPS) rate setting, consist of those costs permitted by the principles of reimbursement contained in the PRM and do not include costs already having payment limited by Medicaid rate file or any other Medicaid charge limitation. (7-1-26) IDAHO ADMINISTRATIVE CODE IDAPA 16.03.26 Department of Health & Welfare Medicaid Plan Benefits Section 070 Page 41 04. Capital Costs. For the purposes of hospital reimbursement, capital costs are those allowable costs considered in the settlement that represent the cost to each hospital for its reasonable property related and financing expense, and property taxes. (7-1-26) 05. Charity Care. Charity care is care provided to individuals who have no source of payment, third- party or personal resources. (7-1-26) 06. Critical Access Hospitals (CAH). A rural hospital as set forth in 42 CFR Section 485.620. (7-1-26) 07. Current Year. Any hospital cost reporting period for which reasonable cost is being determined will be termed the current year. (7-1-26) 08. Inpatient Customary Hospital Charges. Customary inpatient hospital charges reflect the regular rates for inpatient services charged to patient(s) liable for payment for their services on a charge basis. Implicit in the use of charges as the basis for comparability (or for apportionment under certain apportionment methods) is the objective that services are related to the cost of services billed to the Department. (7-1-26) a. All in-state providers not described in b. through d. below will be paid a final prospective payment rate using the APR-DRG classification system as described in these rules. (7-1-26) b. Idaho state-owned hospitals and the Department of Veteran’s Affairs Medical Center will be reimbursed at one hundred percent (100%) of allowable cost using a retrospective cost settlement upon receipt of a final Medicare cost report. (7-1-26) c. In-state and those out-of-state within thirty-five (35) miles of the Idaho border, CAHs will be reimbursed at one hundred one percent (101%) of allowable cost using a retrospective cost settlement upon receipt of a final Medicare cost report. (7-1-26) d. All out-of-state providers not described in a. through c. above will be paid a final prospective payment rate with no retrospective cost settlement using the APR-DRG classification system as described in these rules. The out-of-state APR-DRG rates were developed to provide a combined cost coverage of eighty-seven percent (87%) when all out-of-state providers are averaged together in keeping with Section 56-265(6)(b), Idaho Code. (7-1-26) 09. Outpatient Services Customary Hospital Charges. Customary outpatient hospital charges reflect the regular rates for outpatient services charged to patient(s) liable for payment for their services on a charge basis. Implicit in the use of charges as the basis for comparability (or for apportionment under certain apportionment methods) is the objective that services be related to the cost of services billed to the Department. (7-1-26) a. Idaho state-owned hospitals and the Department of Veteran’s Affairs Medical Center will be reimbursed at one hundred percent (100%) of allowable cost. (7-1-26) b. In-state and those out-of-state within thirty-five (35) miles of the Idaho border, CAHs will be reimbursed at one hundred one percent (101%) of allowable cost. (7-1-26) c. All hospitals that are not described in a. through b. above will be subject to the outpatient reimbursement parameters outlined in the Medicaid Provider Agreement and Section 56-265, Idaho Code. (7-1-26) 10. Disproportionate Share Hospital (DSH) Allotment Amount. The DSH allotment amount determined by CMS that is eligible for federal matching funds in any federal fiscal period for disproportionate share payments. (7-1-26) 11. Disproportionate Share Hospital (DSH) Survey. The DSH survey is an annual data request from the Department to the hospitals to obtain the information necessary to compute DSH payments. (7-1-26) IDAHO ADMINISTRATIVE CODE IDAPA 16.03.26 Department of Health & Welfare Medicaid Plan Benefits Section 071 Page 42 12. Disproportionate Share Threshold. The disproportionate share threshold is: (7-1-26) a. The arithmetic mean plus one (1) standard deviation of the Medicaid Utilization Rates of all Idaho Hospitals; or (7-1-26) b. A Low-Income Revenue Rate exceeding twenty-five percent (25%). (7-1-26) 13. Hospital Inflation Index. An index calculated through Department studies and used to adjust inpatient operating cost limits and interim rates for the current year. (7-1-26) 14. Low-Income Revenue Rate. The Low-Income Revenue Rate is the sum of the following fractions, expressed as a percentage, calculated as follows: (7-1-26) a. Total Medicaid inpatient and outpatient revenues paid to the hospital, plus the amount of the cash subsidies received directly from state and local governments in a cost reporting period, divided by the total amount of revenues and cash subsidies of the hospital in the same cost reporting period; plus (7-1-26) b. The total amount of the hospital's charges for inpatient hospital services attributable to charity care in the same cost reporting period, divided by the total amount of the hospital's charges for inpatient services in the hospital in the same period. The total inpatient charges attributed to charity care must not include contractual allowances and discounts and reduction in charges given to Medicare, Medicaid, other third-party payors, or cash for patient services received directly from state and local governments’ county assistance programs. (7-1-26) 15. Medicaid Inpatient Day. For purposes of DSH payments, an inpatient day is defined as a Medicaid inpatient day in a hospital for which there is also no Medicare inpatient day counted. (7-1-26) 16. Medicaid Utilization Rate (MUR). The MUR for each hospital will be computed using the Department's record of paid inpatient days for the fiscal year divided by the total inpatient days for the same fiscal year as reported in the DSH survey. Inpatient days includes ANDs, newborn days, days in specialized wards, days provided at an inappropriate level of care, and Medicaid inpatient days from other states. (7-1-26) 17. Obstetricians. For purposes of an adjustment for hospitals serving a disproportionate share of low- income patients, and in the case of a hospital located in a rural area, as defined by the federal Executive Office of Management and Budget, the term “obstetrician” includes any physician with staff privileges at the hospital to perform nonemergency obstetric procedures. (7-1-26) 18. On-Site. A service location over which the hospital exercises financial and administrative control. “Financial and administrative control” means a location whose relation to budgeting, cost reporting, staffing, policy- making, record keeping, business licensure, goodwill and decision-making are so interrelated to those of the hospital that the hospital has ultimate financial and administrative control over the service location. The service location must be near the hospital where it is based, and both facilities serve the same patient population (e.g., from the same area, or catchment, within Medicare's defined Metropolitan Statistical Area (MSA) for urban hospitals or thirty-five (35) miles from a rural hospital). (7-1-26) 19. Reasonable Costs. Reasonable costs include all necessary and ordinary costs incurred in rendering the services related to patient care that a prudent and cost-conscious hospital would pay for a given item or service. (7-1-26) 20. Uninsured Patient Costs. For the purposes of determining the additional costs beyond uncompensated Medicaid costs that may be reimbursed as a DSH payment without exceeding the state Allotment Amount, both inpatient and outpatient costs of uninsured patients will be considered. (7-1-26) 21. Upper Payment Limit. The Upper Payment Limit for hospital services is defined in the Code of Federal Regulations. (7-1-26)