AHA Supports Rural Hospital Protection Act

Alexandra Wilson Pecci, for HealthLeaders Media , April 13, 2011

She says CMS's reasoning for the clarification is that since "providers pay this tax, and in return, they might receive Medicaid DSH (disproportionate share hospital) payments, for example," it's not a real cost to the hospital. But Kim says that from AHA's perspective there is no quid pro quo; CAHs don't pay five dollars in taxes and get five dollars in DSH payments.

"They're two separate payments," she says. "We think that they're a legitimate tax cost that should be able to be reimbursed."

So if all of these taxes are legitimate, reviewing them on a case-by-case basis shouldn't be a problem, then, right?

"In theory," that's correct, Kim says. "But the problem is that it was sort of vague."

And the promise of case-by-case reviews doesn't bode well in itself.

"They don't say that unless they have a reason to," Kim says. Although she is careful not to speak for CMS, she adds that AHA thinks the addition of the clarification "does indicate some intent. And we have heard from some hospitals that there are reviews [of cost reports] going on, that there is action being taken."

The Rural Hospital Protection Act (H.R. 1398), was introduced last week by Reps. Sam Graves (R-MO) and Ron Kind (D- WI), and Kim urges CAHs to advocate for its passage.

"I would suggest that they contact their Congressman and tell them about the importance of the Medicare program and reimbursing them for their costs, tell them of much of their costs these taxes represent, and urge their Congressman to support the bill," she says. "We're optimistic that the Congress will pay attention to this."

Alexandra Wilson Pecci is a managing editor for HealthLeaders Media.

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