The key measurements in this section provide a convenient summary of adjustments to Medicare revenue that are reported on a hospital's annual cost report. The cost report contains information such as facility characteristics, utilization data, cost and charges by cost center (in total and for Medicare), Medicare settlement data, and financial statement data. CMS maintains the cost report data in the Healthcare Provider Cost Reporting Information System (HCRIS) which is updated quarterly and is based on a hospital's fiscal year

HIT Payment

CMS developed an Electronic Health Records (EHR) Incentive Program to encourage eligible hospitals to adopt certified EHR technology. These incentives included payments to hospitals for qualifying Health Information Technology (HIT). These payments are reported on Worksheet E-1, part II of a hospital's cost report.

VBP Adjustment

CMS developed a Value Based Purchasing (VBP) program to provide hospitals with financial incentives for IPPS patients based on selected quality metrics. These incentives are given as adjustments to the DRG payment amount each fiscal year. The adjustment amount is reported on Worksheet E, part A, line 70.93 of a hospital's cost report.

DSH Ratio

Hospitals that treat relatively high numbers of low income patients are designated as Disproportionate Share Hospitals (DSH) and are eligible for additional Medicare payment. A DSH ratio is calculated in determining whether a hospital is designated. In general, it is the sum of the percentage of SSI recipient patient days to total inpatient days plus the percentage of Medicaid days to total inpatient days. The ratio is reported on Worksheet E, part A, line 33 of a hospital's cost report.

DSH Amount

Hospitals that treat relatively high numbers of low income patients are designated as Disproportionate Share Hospitals (DSH) and are eligible for additional Medicare payment. The DSH Amount is reported on Worksheet E, part A, line 44 of a hospital's cost report.

Uncompensated Care

Beginning in 2015, CMS has been publishing rulings that effect DSH Payments (above) and Uncompensated Care. Additional payment for Uncompensated Care is reported on Worksheet E, part A, line 36 of a hospital's cost report.

IME Amount

IPPS hospitals that have residents in an approved graduate medical education (GME) program receive an additional payment for a Medicare discharge to reflect the higher patient care costs of teaching hospitals relative to non-teaching hospitals. The amount of this adjustment is reported on Worksheet E, part A, line 29 of a hospital's cost report.

Readmission Adjustment

CMS developed a Hospital Readmission Reduction program that reduces payments to hospitals with excessive 30-day readmission rates. As defined, a readmission may be to the same hospital or to a different hospital or acute care facility. Patients may be readmitted for the same condition that necessitated his or her recent hospital stay, or for a different reason. The Readmission Reduction amount is reported on Worksheet E, part A, line 70.94 of a hospital's cost report.

HAC Adjustment

Beginning in FY15, CMS has begun reducing Medicare payments for Inpatient Prospective Payment System hospitals with a high rate of complications occurring after admission. Hospital-Acquired Conditions (HACs) are a group of reasonably preventable conditions that patients did not have upon admission to a hospital, but which developed during the hospital stay. Hospital performance under the HAC Reduction Program is determined based on a hospital's Total HAC Score, which can range from 1 to 10. Hospitals in the highest quartile receive a 1% payment reduction. The HAC Adjustment amount is reported on Worksheet E, part A, line 70.99 of a hospital's cost report.