Low volume adjustment expires October 1, 2017 with $5M South Dakota impact

The Affordable Care Act (ACA) improved the low-volume adjustment for FYs 2011 and 2012, and MACRA extended the adjustment through the end of FY 2017.

For these years, a low volume hospital is defined as one that is more than 15 road miles (rather than 35 miles) from another comparable hospital and has up to 1,600 Medicare discharges (rather than 800 total discharges). An add-on payment is given to qualifying hospitals, ranging from 25 percent for hospitals with fewer than 200 Medicare discharges to no adjustment for hospitals with more than1,600 Medicare discharges.

Currently, 8 South Dakota facilities and about 500 rural hospitals receive the low-volume adjustment; the adjustment in the ACA better accounts for the relationship between cost and volume and helps sustains and improves access to care in rural areas.

SDAHO & AHA strongly urge Congress to pass the Rural Hospital Access Act (S. 332/H.R. 663), bipartisan legislation to permanently extend the enhanced low-volume adjustment payment.  Similar to the last extension, we can expect the CHIP reauthorization to be a key driver in the upcoming health care minibus discussions.