Safety Net & DSH Hospital Financial Strategy Consulting

Safety Net & DSH Hospital Financial Strategy Consulting

Disproportionate share hospitals serve patient populations with high rates of Medicaid coverage and uninsurance — populations that generate lower reimbursement per encounter and higher rates of uncompensated care than commercially insured populations. In recognition of this burden, the Medicare and Medicaid programs provide DSH adjustment payments that supplement base reimbursement. But these supplemental payments are calculated using complex methodologies, subject to annual audits, and increasingly threatened by legislative proposals to reduce or restructure them.

Understanding the full landscape of supplemental funding available to safety net hospitals — and ensuring that your hospital is capturing every dollar it is entitled to — requires specialized expertise in DSH payment methodology, Medicaid supplemental payment programs, uncompensated care management, and the intersection of safety net funding with 340B and graduate medical education payments.

Service Areas

DSH Payment Optimization

Medicare DSH payments are calculated based on the hospital's proportion of low-income patients — including both Medicaid patients and SSI recipients. We assess your current DSH calculation for accuracy, identify opportunities to improve your DSH percentage through data completeness, and help you navigate the Medicare DSH payment methodology to ensure you are receiving the full DSH supplement your patient population justifies.

Medicaid Supplemental Payment Programs

Most states operate supplemental payment programs — including Uncompensated Care Pools, Graduate Medical Education supplemental payments, directed payments, and intergovernmental transfer arrangements — that provide additional Medicaid funding to qualifying hospitals. We help safety net hospitals identify all available supplemental payment opportunities in their state, meet the eligibility and documentation requirements for each program, and maximize their supplemental payment receipts.

Uncompensated Care Management

Uncompensated care — the combination of charity care and bad debt — is the defining financial challenge of safety net hospital operations. We assess your current charity care program, financial counseling processes, eligibility screening for Medicaid and other coverage programs, and uncompensated care cost reporting to ensure that your uncompensated care is accurately documented for both financial reporting and supplemental payment purposes.

340B Program Maximization

Safety net hospitals — particularly DSH hospitals with high Medicaid and uninsured patient volumes — are among the largest beneficiaries of the 340B drug pricing program. We help safety net hospitals maximize their 340B program savings within compliance boundaries and reinvest those savings in patient care programs that serve their mission.

Graduate Medical Education (GME) Payment Optimization

Teaching hospitals that have residency programs receive Medicare GME payments — both direct GME payments for the costs of training and indirect medical education payments for the higher cost of care in teaching environments. We assess GME payment calculations for accuracy and help teaching hospitals understand and optimize their GME payment position.