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This proposed rule aims to increase accountability, transparency, and clarity through improved reporting of Medicaid payments.

Statement of Need:

To improve the operation and oversight of the Medicaid program, CMS needs more complete, reliable, and timely information regarding the distribution and funding of supplemental payments authorized in a State’s Medicaid State plan, including Medicaid Disproportionate Share Hospital (DSH) payments. This proposed rule would increase the agency’s capacity to evaluate payments at a provider-specific level for both State plan services and demonstration programs, improve efforts to provide technical assistance to States, further the agency’s program integrity goals, and aid in developing future policies to increase transparency and accountability.The requirements proposed within this rule will also improve our ability to evaluate the necessity, effectiveness, and impact of supplemental provider payments and DSH payments.

Summary of the Legal Basis:

The authority for oversight of Medicaid payments for services is derived from section 1902(a) of the Social Security Act (the Act), particularly, 1902(a)(2), 1902(a)(4), 1902(a)(6) and 1902(a)(30)(A) of the Act. The authority for oversight of Medicaid program financing is defined in sections 1902(a)(2) and 1906(w) of the Act.  DSH payments and the oversight of such payments is authorized in section 1923(g) of the Act.

Alternatives:

We considered not publishing this rule. However, we believe this rule would lead to better accountability and transparency with regard to supplemental payments, Medicaid financing and the reporting of payments associated with DSH. Currently, we do not have the necessary data at the provider level to perform adequate analysis and oversight of supplemental payments. Other alternatives considered will be included in the rule.

Anticipated Costs and Benefits:

The rule is not expected to be economically significant. Estimates of the cost and benefits of these provisions will be included in the rule.

Risks:

Risks will be included in the published rule for comment.