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The U.S. Supreme Court on Monday ruled that HHS improperly changed its Medicare disproportionate-share hospital payments when it made billions of dollars in cuts. In a 7-1 decision, the justices said HHS needed a notice-and-comment period for the Medicare DSH calculation change. Justice Neil Gorsuch wrote in the decision that HHS' position for not following the procedure was "ambiguous at best." (Luthi, 6/3)

The highly technical ruling and dispute involves billions of dollars in Medicare payments to hospitals. The court ruled for hospitals that had sued over the 2014 policy, which reduced their payments for serving low-income patients because of a change to the payment formula.“In 2014, the government revealed a new policy on its website that dramatically—and retroactively—reduced payments to hospitals serving low-income patients,” Gorsuch wrote. (Thomsen and Sullivan, 6/3)

Minneapolis-based Allina Health prevailed in a U.S. Supreme Court decision that reverses a move by federal Medicare authorities to cut billions of dollars in payments supporting hospital care for low-income patients. Three Allina hospitals were among a group of nine that challenged the change, which decreased their federal payments by about $49 million a year. But the ruling, issued Monday, affects all U.S. hospitals that serve high numbers of low-income patients. (Howatt, 6/3)