Hospital Low Volume Payment

To receive the low-volume payment adjustment (LVPA), a hospital must submit a written request each year to its Part A/Part B Medicare Administrative Contractor (MAC) by September 1. This statement must address that the hospital meets the criteria in the regulation as found on the Code of Federal Regulations, Section 412.101.

The Current Requirements to Qualify for Fiscal Year (FY) 2026

• A hospital must have fewer than 200 total discharges, which include Medicare and non-Medicare discharges, during the fiscal year, based on the hospital's most recently submitted cost report
• A hospital also must be located more than 25 road miles (as defined in paragraph [a] of this section) from the nearest subsection (d) hospital*

Prior FY 2025 Requirements

For FY 2019 through FY 2024 and the portion of FY 2025 beginning on October 1, 2024, and ending on December 31, 2024:

• A hospital must have fewer than 3,800 total discharges, which includes Medicare and non-Medicare discharges, during the fiscal year, based on the hospital's most recently submitted cost report
• A hospital also must be located more than 15 road miles (as defined in paragraph [a] of this section) from the nearest subsection (d) hospital*

* See Section 1886(d) of the Social Security Act (the ACT)

In order to qualify for the adjustment, a hospital must provide its fiscal intermediary or Medicare administrative contractor with sufficient evidence that it meets the distance requirement specified under paragraph (b)(2) of this section. The fiscal intermediary or Medicare administrative contractor will base its determination of whether the distance requirement is satisfied upon the evidence presented by the hospital and other relevant evidence, such as maps, mapping software and inquiries to State and local police, transportation officials or other government officials.

The Adjustment Calculation

For FY 2019 through FY 2024 and the portion of FY 2025 beginning on October 1, 2024, and ending on December 31, 2024, the adjustment is as follows:

1. For low-volume hospitals with 500 or fewer total discharges, which includes Medicare and non-Medicare discharges, during the fiscal year, based on the hospital's most recently submitted cost report, the adjustment is an additional 25 percent for each Medicare discharge.
    
2. For low-volume hospitals with more than 500 and fewer than 3,800 total discharges, which includes Medicare and non-Medicare discharges, during the fiscal year, based on the hospital's most recently submitted cost report, the adjustment for each Medicare discharge is an additional percent calculated using the formula [(95/330)−(number of total discharges/13,200)]. “Total discharges” is determined as described in paragraph (b)(2)(iii) of this section.

Eligibility of new hospitals for the adjustment. For FYs 2005 through 2010 and FY 2019 and subsequent fiscal years, a new hospital will be eligible for a low-volume adjustment under this section once it has submitted a cost report for a cost reporting period that indicates that it meets discharge requirements during the applicable fiscal year and has provided its Medicare administrative contractor with sufficient evidence that it meets the distance requirement, as specified in paragraph (b)(2) of this section.

Email, Fax or Mail Your Request to Palmetto GBA

Email is preferred.

• Jurisdiction J: JJIRR@PalmettoGBA.com 
• Jurisdiction M: JMReimbursement@PalmettoGBA.com
• JJ and JM fax number: (803) 935–0262

Due to the nature of change that occurs with these requirements and timelines, please feel free to submit requests that match the old requirements, and we will review based on current instructions from CMS.