Stephanie Webster Comments on DSH Overpayment Skrimish between Hospitals and CMS

Stephanie Webster, a partner in Akin Gump’s health practice, is quoted in an Inside Health Policy article that looks at a battle between four hospitals in Oklahoma and the Centers for Medicare & Medicaid Services (CMS). At issue is whether the hospitals were overpaid under the Disproportionate Hospital Share (DSH) program, which provides funding to hospitals that treat indigent patients. CMS is trying to recoup $250 million.

Webster says hospitals are supposed to file a cost report five months after the year ends and Medicare then has one year to tell those hospitals whether they owe money, but that hasn’t been happening in recent years. Instead, she says, they were “held up across the board for four years, from 2009 to 2013, for Medicare DSH hospitals for cost reporting periods ending 2007 and later.”

While hospitals can file appeals, Webster says they cannot rely on a bad decision by a Medicare administrative contractor as their defense. Still, she adds the backlog hurts the hospitals since they end up going several years without knowing whether they owe money, which could eventually affect their credit rating and their ability to get new bonds.