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HOSPITALS: How many DSH hospitals are there?

Hospitals that serve a higher proportion of low-income patients are eligible to receive disproportionate share payments from state Medicaid programs.

DSH hospital: A hospital that receives disproportionate share hospital (DSH) payments and meets the minimum statutory requirements to be eligible for DSH payments: a Medicaid inpatient utilization rate of at least 1 percent and at least two obstetricians with staff privileges that treat Medicaid enrollees (with certain exceptions” (page 57)

In this report from the Medicaid and CHIP Payment and Access Commission (MACPAC), there is a table that quantifies the number of disproportionate share hospitals (DSH) in the United States as of 2012.

DSH Hospitals: Counts by Type of Hospital

  • 1,865 (55 percent) of Short-term acute care hospitals
  •    565 (42 percent) of Critical access hospitals
  •    129 (26 percent) of Psychiatric hospitals
  •      47 (58 percent) of Children’s hospitals
  •      32 (  7 percent) of Long-term hospitals
  •      32 (13 percent) of Rehabilitation hospitals

Counts by Location

  • 1,681 (40 percent) of urban hospitals
  •    989 (54 percent) of rural hospitals

Counts by Teaching Status

  • 1,921 (39 percent) of non-teaching hospitals
  •    392 (59 percent) of “low-teaching” hospitals
  •    357 (79 percent) of “high-teaching” hospitals

Source: Medicaid and CHIP Payment and Access Commission. (2017, March). Report to Congress on Medicaid and CHIP (pp. 57, 59). Washington, D.C.: MACPAC.  Click here for access: https://www.macpac.gov/wp-content/uploads/2017/03/March-2017-Report-to-Congress-on-Medicaid-and-CHIP.pdf  Posted by AHA Resource Center (312) 422-2050, rc@aha.org


Health Care Payment Methods: How They Work

Health care is undergoing a shift from volume to value-based payment methods, although a blend of both volume and value reimbursement mechanisms are typically used together. Each payment method has its pros and cons and can affect both providers and consumers differently. Insurance benefit design also has an influential role on payment.

A new collaborative report from the Urban Institute and Catalyst for Payment Reform examines the intersection of payment and benefit design. It looks at different payment methods and identifies the key objectives, strengths, weaknesses, design choices to mitigate weaknesses, compatibility with other payment methods and benefit designs, the focus on performance measurement, and the potential impact on provider prices for each method. The following payment methods are covered:

  • Fee schedules for physicians and other health professionals
  • Primary care capitation
  • Per diem payment to hospitals for inpatient stays
  • Diagnosis Related Groups-based payment to hospitals for inpatient stays
  • Global budgets for hospitals
  • Bundled episode payment
  • Global capitation to an organization
  • Shared savings
  • Pay-for-performance

Source: Berenson RA and others. Payment methods: how they work. Payment methods and benefit designs: how they work and how they work together to improve health care. Urban Institute; Catalyst for Payment Reform, updated May 17, 2016. http://www.urban.org/sites/default/files/alfresco/publication-pdfs/2000776-Payment-Methods-How-They-Work.pdf

Posted by AHA Resource Center (312) 422-2050, rc@aha.org

HIP REPLACEMENT: You might have to go to school first

Total joint replacement procedures – hips and knees – are commonly performed on Medicare patients, costing an estimated $7 billion annually for the hospital care alone.  The Centers for Medicare & Medicaid Services (CMS) has developed a bundled payment pilot initiative with mandatory participation for 67 selected health care markets nationwide.  One cost-reduction approach that is being tried by several providers is the idea of having elective hip and knee patients go to an “academy,” or otherwise receive patient education, before surgery to remove or lessen risk factors that might complicate their recovery.  Among the hospitals and health systems trying this out are: DCH Regional Health System (Tuscaloosa, Ala.), Catholic Health Initiatives (Englewood, Colo.), and BayCare Health (Clearwater, Fla.).

For more information about the CMS initiative, click here: https://innovation.cms.gov/initiatives/cjr

Source: Evans, M. (2016, Mar. 28). Ready or not, the bundled-payment challenge is about to start. Modern Healthcare, 46(13), 8-9.  Click here for publisher’s website: http://www.modernhealthcare.com/article/20160326/MAGAZINE/303269996  Posted by AHA Resource Center (312) 422-2050, rc@aha.org

FORECASTING: Hospital payer mix 2014 and 2024, U.S.

What are the projections for U.S. hospitals’ Medicare margins over the next 10 years?  This brief article by a staff specialist at the Healthcare Financial Management Association takes a look at data from the Congressional Budget Office and the Medicare Payment Advisory Commission to address this issue.  I especially like the inclusion of payer mix statistics for the two endpoint years.  Here they are:


  • 37.8 percent  Commercial
  • 35.1 percent Medicare
  • 18.2 percent Medicaid
  •   5.8 percent Other governmental
  •   3.1 percent Self-pay


  • 40.0 percent Medicare
  • 33.0 percent Commercial
  • 18.4 percent Medicaid
  •   5.7 percent Other governmental
  •   2.9 percent Self-pay

Source: Mulvany, C. (2016, Apr.). Margins under pressure. HFM. Healthcare Financial Management, 70(4), 30-33. Click here: https://www.hfma.org/Content.aspx?id=47230 Posted by AHA Resource Center (312) 422-2050, rc@aha.org

Top 10 Issues Facing Community Hospital CEOs

Last month the American College of Healthcare Executives released the results of its annual CEO survey on the top concerns confronting community hospitals. The most pressing concerns of the CEOs in 2015 were:

  1. Financial challenges
  2. Patient safety and quality
  3. Governmental mandates
  4. Personnel shortages
  5. Patient satisfaction
  6. Physician-hospital relations
  7. Access to care
  8. Population health management
  9. Technology
  10. Reorganization [mergers, acquisitions, restructuring, partnerships]

Financial challenges has remained the top concern when compared to 2013 and 2014 surveys. Transition from volume to value, Medicaid reimbursement, bad debt, and increasing costs were among the financial challenges most often mentioned. Engaging physicians in improving the culture of safety/quality and in reducing clinically unnecessary tests and procedures were top concerns related to patient safety and quality.

Access to care and reorganization were new to the top 10 list in 2015, and personnel shortages rose to 4th place on the list, up from the 10th spot in 2014.

Source: Top issues confronting hospitals in 2015. American College of Healthcare Executives, Feb. 2, 1016. http://ache.org/pubs/research/ceoissues.cfm [press release: http://ache.org/pubs/Releases/2016/top-issues-confronting-hospitals-2015.cfm]

Posted by AHA Resource Center (312) 422-2050, rc@aha.org

The Burden of Medical Debt: Survey Results

A quarter of U.S adults under age 65 report they or their household have had a problem paying a medical bill within the past year. While over half of the uninsured had medical bill difficulties, health insurance was no panacea against the problem. Around 20% of those with insurance also reported a problem paying medical bills. In fact, for households with medical bill payment issues, over 60% had health insurance.  Insurance deductibles make a difference in ability to pay a bill.

While those with low or moderate incomes are more commonly affected by the difficulty or inability to pay medical bills, people from all walks of life experience the problem. These are the findings from a survey jointly conducted by the Kaiser Family Foundation and the New York Times.

The report on the findings covers the circumstances leading to medical bill problems, the financial status of those with the problem, and the consequences that have resulted from the issue.


Hamel L and others. The burden of medical debt: results from the Kaiser Family Foundation/New York Times medical bills survey. Kaiser Family Foundation, Dec. 2015. https://kaiserfamilyfoundation.files.wordpress.com/2016/12/8806-the-burden-of-medical-debt-results-from-the-kaiser-family-foundation-new-york-times-medical-bills-survey1.pdf

Sanger-Katz M. Even insured can face crushing medical debt, study finds. New York Times, Jan. 5, 2016. http://www.nytimes.com/2016/01/06/upshot/lost-jobs-houses-savings-even-insured-often-face-crushing-medical-debt.html

Related: Cohen RA. Problems paying medical bills among persons under age 65: early release of estimates from the National Health Interview Survey, 2011-June 2014. National Center for Health Statistics, Feb. 2015. http://www.cdc.gov/nchs/data/nhis/earlyrelease/probs_paying_medical_bills_jan_2011_jun_2014.pdf

Posted by AHA Resource Center (312) 422-2050 rc@aha.org

HFMA Survey: Value-Based Payment Readiness

Earlier this year the Healthcare Financial Management Association surveying a sampling of senior financial executives in hospitals and health systems to learn more about healthcare’s readiness for value-based care. The survey probed for the current state of readiness, projected needs, anticipated gaps and penetration, the financial impact to date of their efforts, and perceptions on enabling risk-based contracting.

Here are some of the key findings:

  • Over half of respondents said their system had achieved a positive return on investment from a value-based program.
  • Yet nearly 40% don’t feel their organization has the needed capabilities to succeed within 3 years in risk-based value arrangements when if comes to interoperability, business intelligence, real-time data access, and effective chronic care management.
  • Such gaps are of concern when respondents expect 30-70% of their payments will include value-based mechanisms with 3 years.
  • Competencies involving data analytics ranked highest among respondents in the likelihood of enabling value-based payment success.


HFMA’s executive survey: value-based payment readiness. Healthcare Financial Management Association; Humana, May 2015. http://www.hfma.org/WorkArea/DownloadAsset.aspx?id=30969

Value-based payment readiness; HFMA research highlight. Healthcare Financial Management Association, June 3, 2015. http://www.hfma.org/value-basedpaymentreadiness/

Posted by AHA Resource Center (312) 422-2050 rc@aha.org