Fifteen years ago, a federal court ruled that the Centers for Medicare & Medicaid Services was calculating Medicare disproportionate share payments (Medicare DSH) incorrectly and ordered the agency to fix the problem and reimburse eligible hospitals for the underpayments they had experienced.

Now, after 15 years of waiting, 40 of those hospitals are suing for their money.

In a suit filed in federal court, the hospitals outline the actions CMS has and has not taken to correct the problem and write that

The agency’s contractors have not performed the revised determinations required under the ruling and the rule and have not paid the plaintiff hospitals any of the additional amounts due them for the periods at issue.

In seeking back payment and damages, the plaintiffs also write that

The agency’s unreasonable delay has cost the plaintiff hospitals tens of millions of dollars in funds that should have been paid to them many years ago for the higher costs that they incurred to treat low-income patients more than a decade ago. 

The purpose of Medicare DSH payments is to help hospitals that care for unusually large numbers of low-income and uninsured patients with the cost of caring for those patients.   All community safety-net hospitals qualify for Medicare DSH payments and view those payments as a vital tool in helping them pursue health equity and ensure access to care in the generally diverse, low-income communities they serve.

Learn more about the 15 years that have passed since the problem was supposedly settled and where matters stand today from the Becker’s Hospital Review article “HHS sued by hospitals over ‘delayed’ Medicare DSH payments.”