Virginia Regulatory Town Hall
Department of Medical Assistance Services
Board of Medical Assistance Services
Methods and Standards for Establishing Payment Rates; in-Patient Hospital Care [12 VAC 30 ‑ 70]
2016 Institutional Provider Reimbursement
Action 4876
[Withdrawn 8/8/2017]
General Information
Action Summary 1. The proposed amendments at 12 VAC 30-70-351 reduce state FY2017 inflation by 50% for inpatient and outpatient hospital operating (including freestanding psychiatric and long stay hospitals), graduate medical expenses (GME), indirect medical education (IME), and disproportionate share hospital (DSH) payments and outpatient hospital rates with the exception of inflation for inpatient and outpatient hospital operating, GME, and IME payments for Children’s Hospital of King’s Daughters. 2. The proposed amendments at 12 VAC 30-90-264 convert the specialized care rate methodology to a fully prospective state fiscal year rate, effective July 1, 2016. This would be accomplished consistent with the existing cost-based methodology by adding inflation to the per diem costs subject to existing ceilings for direct, indirect and ancillary costs from the most recent settled cost report prior to the state fiscal year for which the rates are being established. DMAS shall use the state fiscal year inflation rate recently adopted for regular nursing facilities. Partial year inflation shall be applied to per diem costs if the provider fiscal year end is different than the state fiscal year. Ceilings shall also be maintained by state fiscal year. 3. The proposed amendments at 12 VAC 30-70-221 and 12 VAC 30-70-381 change the methodology for costing claims used to rebase weights from a fee-for-service global cost-to-charge methodology to a methodology that uses per-diems and cost-to-charge ratios by cost center for the fee-for-service and managed care claims, effective July 1, 2016. In a similar fashion, each hospital’s total costs by claim using this methodology will be divided by the total charges for the hospital cost-to-charge ratio.
Chapters Affected
  VAC Chapter Name Action Type
Primary 12 VAC 30-70 Methods and Standards for Establishing Payment Rates; in-Patient Hospital Care Amend Existing Regulation
Other chapters
  12 VAC 30 - 90 Methods and Standards for Establishing Payment Rates for Long-Term Care Amend Existing Regulation
Executive Branch Review This action will go through the normal Executive Branch Review process.
RIS Project Yes  [005144]
New Periodic Review This action will not be used to conduct a new periodic review.
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Contact Information
Name / Title: Emily McClellan  / Regulatory Supervisor
Address: Policy Division, DMAS
600 E. Broad Street, Suite 1300
Richmond, VA 23219
Email Address:
Phone: (804)371-4300    FAX: (804)786-1680    TDD: ()-

This person is the primary contact for this chapter.