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Public Notice of Final Action for Rural Hospital Payment Methodology

The South Carolina Department of Health and Human Services (SCDHHS), pursuant to the requirements of Section 1902(a)(13)(A) of the Social Security Act, gives notice of the following actions regarding rates for rural hospital services under the State Plan under Title XIX of the Social Security Act Medical Assistance Program (Medicaid).

Effective for services on or after July 1, 2023, SCDHHS will amend the South Carolina Title XIX State Plan as follows:

  1. 1. The agency will eliminate retrospective cost settlements for all South Carolina-defined rural hospitals (as defined in the State Plan), which are becoming increasingly administratively burdensome on the rural provider community and the state.
  2. 2. The agency will develop cost-based prospective payment rates based on the two-year average of each hospital’s 2020 and 2021 payment data and applied as a percentage base rate adjustment to the current inpatient and outpatient fee schedules. Notices of individual base rate adjustments will be administered by SCDHHS.

The agency estimates this conversion will result in no additional state spending. Copies of this notice are available at each South Carolina Healthy Connections Medicaid county eligibility office and at for public review. Additional information regarding these actions is available upon request at the address cited below.

Any written comments submitted may be reviewed by the public at SCDHHS, Division of Acute Care/Ancillary Reimbursements, Room 400-52, 1801 Maain Street, Columbia, South Carolina, Monday through Friday between the hours of 9 a.m. and 5 p.m.

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