LEGAL NOTICE

COMMONWEALTH OF VIRGINIA

DEPARTMENT OF MEDICAL ASSISTANCE SERVICES

NOTICE OF INTENT TO AMEND

(Pursuant to §1902(a)(13) of the Act (U.S.C. 1396a(a)(13))

THE VIRGINIA STATE PLAN FOR MEDICAL ASSISTANCE

This Notice was posted on August 27, 2026

The Virginia Department of Medical Assistance Services (DMAS) hereby affords the public notice of its intention to amend the Virginia State Plan for Medical Assistance to provide for changes to the Methods and Standards for Establishing Payment Rates —  In-Patient Hospital Care (12 VAC 30-70) and Methods and Standards for Establishing Payment Rates — Other Types of Care (12 VAC 30-80).  

This notice is intended to satisfy the requirements of 42 C.F.R. § 447.205 and of § 1902(a)(13) of the Social Security Act, 42 U.S.C. § 1396a(a)(13).  A copy of this notice is available for public review from Meredith Lee, DMAS, 600 Broad Street, Suite 1300, Richmond, VA  23219, or via e-mail at: Meredith.Lee@dmas.virginia.gov. 

DMAS is specifically soliciting input from stakeholders, providers and beneficiaries, on the potential impact of the proposed changes discussed in this notice.  Comments or inquiries may be submitted, in writing, within 30 days of this notice publication to Meredith Lee and such comments are available for review at the same address.  Comments may also be submitted, in writing, on the Town Hall public comment forum attached to this notice.

This notice is available for public review on the Regulatory Town Hall (https://townhall.virginia.gov) on the General Notices page, found at:  https://townhall.virginia.gov/L/generalnotice.cfm

In accordance with the 2025 Appropriations Act, DMAS will be making the following changes:

Methods & Standards for Establishing Payment Rates-In-Patient Hospital Care (12 VAC 30-70) & Methods & Standards for Establishing Payment Rates-Other Types of Care (12 VAC 30-80)

• Item 291.LL.2: The state plan is being revised to modify supplemental payments for freestanding children’s hospitals to equal the greater of what would have been paid to the freestanding children's hospitals under the current disproportionate share hospital (DSH) formula or annually the DSH formula effective in fiscal year 2026. These additional hospital supplemental payments shall take precedence over supplemental payments for private hospitals.

There are no expected increases or decreases in annual fee-for-service aggregate expenditures in federal fiscal year 2027 or federal fiscal year 2028. 

• Item 291.QQ.2: The state plan is being revised to make supplemental payments for each new qualifying residency slot $145,000 annually minus any Medicare residency payment for which the sponsoring institution is eligible.  For any residency program at a facility whose number of residency slots are above the cap set by the Centers for Medicare and Medicaid Services or have exceeded the Upper Payment Limit (UPL) set by CMS, the supplemental payments for each qualifying residency slot shall be $72,500 from the general fund annually. 

The expected increase in annual fee-for-service aggregate expenditures is $2,698,920 in state general funds and $2,701,080 in federal funds in federal fiscal year 2027, and $2,698,920 in state general funds and $2,701,080 in federal funds in federal fiscal year 2028.

• Item 3-5.14.J: The state plan is being revised to require rural hospitals receiving enhanced payments to retain labor and delivery units. DMAS shall not provide private enhanced payments in the form of state directed payments to any rural hospital that does not currently operate a labor and delivery unit but such unit was operational in the rural hospital on January 1, 2026. For the purposes of this item, rural hospital is the same as defined by the Centers for Medicare and Medicaid Services.

There are no expected increases or decreases in annual fee-for-service aggregate expenditures in federal fiscal year 2027 or federal fiscal year 2028.