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Enhanced Medicare Low Volume Adjustment

Written by Warren Averett on March 1, 2018

On February 9, 2018, the President signed into law the Bipartisan Budget Act (BBA) of 2018. The Act renewed many Medicare Extenders that impact most rural providers and had previously expired. Among them is the Enhanced Medicare Low Volume Adjustment.
Providers that met certain mileage requirements and had less than 1,600 Medicare discharges had been eligible for an add-on payment to the normal DRG payment based on a sliding scale. The enhancement has expired and has been renewed several times over the last decade; it last expired on September 30, 2017.

The BBA not only renews this add-on payment for an additional five years through 2022, but it also increases the ceiling on the sliding scale from 1,600 Medicare discharges to 3,800 Medicare discharges. Current low volume payments will continue unchanged through September 30, 2018, with the modified payment adjustments beginning October 1, 2018.

The increase in the ceiling of the sliding scale will open this additional payment to many providers that may not have previously qualified due to their numbers of Medicare discharges; it should also increase the payment to providers that are currently receiving it and have not been capped at the 25% maximum. The add-on will begin at 25% for hospitals with fewer than 500 Medicare discharges and decrease to 0% for hospitals with more than 3,800 Medicare discharges.

In past years, providers that had previously received the payment were only required to attest to the intermediary that nothing had changed which would affect their qualifications under the mileage requirements. Providers making an initial application had to attest to mileage and include documentation proving such information. While we await guidance from the intermediary as to how and when providers should apply for this additional payment as it has been extended, we do know that the applications for providers in Jurisdiction J (Alabama, Georgia and Tennessee) under Palmetto should submit the attestations to:

Part A Provider Reimbursement
Mail Code: AG-390
P.O. Box 100307
Columbia, SC 29202-3307

Please contact your Warren Averett advisor with any questions.

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