[Federal Register Volume 60, Number 170 (Friday, September 1, 1995)]
[Rules and Regulations]
[Pages 45778-45946]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-21541]
[[Page 45777]]
_______________________________________________________________________
Part II
Department of Health and Human Services
_______________________________________________________________________
Health Care Financing Administration
_______________________________________________________________________
42 CFR Part 412, et al.
Medicare Program; Changes to the Hospital Inpatient Prospective Payment
Systems and Fiscal Year 1996 Rates; Final Rule
Federal Register / Vol. 60, No. 170 / Friday, September 1, 1995 /
Rules and Regulations
[[Page 45778]]
DEPARTMENT OF HEALTH AND HUMAN SERVICES
Health Care Financing Administration
42 CFR Parts 412, 413, 424, 485, and 489
[BPD-825-FC]
RIN 0938-AG95
Medicare Program; Changes to the Hospital Inpatient Prospective
Payment Systems and Fiscal Year 1996 Rates
AGENCY: Health Care Financing Administration (HCFA), HHS.
ACTION: Final rule with comment period.
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SUMMARY: We are revising the Medicare hospital inpatient prospective
payment systems for operating costs and capital-related costs to
implement necessary changes arising from our continuing experience with
the system. In addition, in the addendum to this final rule, we are
describing changes in the amounts and factors necessary to determine
prospective payment rates for Medicare hospital inpatient services for
operating costs and capital-related costs. These changes are applicable
to discharges occurring on or after October 1, 1995. We are also
setting forth rate-of-increase limits as well as policy changes for
hospitals and hospital units excluded from the prospective payment
systems. Finally, we are setting forth several requirements concerning
Essential Access Community Hospitals (EACHs) and Rural Primary Care
Hospitals (RPCHs), in accordance with provisions of the Social Security
Act Amendments of 1994.
DATES: Effective Date: This final rule is effective on October 1, 1995,
except that revised Sec. 412.46 (concerning the physician attestation
requirement for inpatient claims) is effective September 1, 1995.
Comments: Comments on revised Sec. 485.645 (concerning the
requirements for RPCH providers of long-term care services (``swing
beds'')) will be considered if we receive them at the appropriate
address, as provided below, no later than 5 p.m. on October 31, 1995.
We will not consider comments concerning any other issue.
ADDRESSES: Mail written comments (1 original and 3 copies) to the
following address: Health Care Financing Administration, Department of
Health and Human Services, Attention: BPD-825-FC, P.O. Box 7517,
Baltimore, MD 21207-0517.
If you prefer, you may deliver your written comments (1 original
and 3 copies) to one of the following addresses: Room 309-G, Hubert H.
Humphrey Building, 200 Independence Avenue SW., Washington, DC 20201,
or Room C5-09-26, 7500 Security Boulevard, Baltimore, MD 21244-1850.
Because of staffing and resource limitations, we cannot accept
comments by facsimile (FAX) transmission. In commenting, please refer
to file code BPD-825-FC. Comments received timely will be available for
public inspection as they are received, generally beginning
approximately 3 weeks after publication of a document, in Room 309-G of
the Department's offices at 200 Independence Avenue SW., Washington,
DC, on Monday through Friday of each week from 8:30 a.m. to 5 p.m.
(phone: (202) 690-7890).
Copies: To order copies of the Federal Register containing this
document, send your request to: New Orders, Superintendent of
Documents, P.O. Box 371954, Pittsburgh, PA 15250-7954. Specify the date
of the issue requested and enclose a check or money order payable to
the Superintendent of Documents, or enclose your Visa or Master Card
number and expiration date. Credit card orders can also be placed by
calling the order desk at (202) 512-1800 or by faxing to (202) 512-
2250. The cost for each copy is $8.00. As an alternative, you can view
and photocopy the Federal Register document at most libraries
designated as Federal Depository Libraries and at many other public and
academic libraries throughout the country that receive the Federal
Register.
FOR FURTHER INFORMATION CONTACT:
Nancy Edwards, (410) 786-4531, Operating Prospective Payment, DRG, Wage
Index Issues.
Tzvi Hefter, (410) 786-4529, Capital Prospective Payment, Excluded
Hospitals, EACH, RPCH.
SUPPLEMENTARY INFORMATION:
I. Background
A. Summary
Under section 1886(d) of the Social Security Act (the Act), a
system of payment for the operating costs of acute care hospital
inpatient stays under Medicare Part A (Hospital Insurance) based on
prospectively-set rates was established effective with hospital cost
reporting periods beginning on or after October 1, 1983. Under this
system, Medicare payment for hospital inpatient operating costs is made
at a predetermined, specific rate for each hospital discharge. All
discharges are classified according to a list of diagnosis-related
groups (DRGs). The regulations governing the hospital inpatient
prospective payment system are located in 42 CFR part 412. On September
1, 1994, we published a final rule with comment period (59 FR 45330) to
implement changes to the prospective payment system for hospital
operating costs beginning with Federal fiscal year (FY) 1995.
For cost reporting periods beginning before October 1, 1991,
hospital inpatient operating costs were the only costs covered under
the prospective payment system. Payment for capital-related costs had
been made on a reasonable cost basis because, under sections 1886
(a)(4) and (d)(1)(A) of the Act, those costs had been specifically
excluded from the definition of inpatient operating costs. However,
section 4006(b) of the Omnibus Budget Reconciliation Act of 1987
(Public Law 100-203) revised section 1886(g)(1) of the Act to require
that, for hospitals paid under the prospective payment system for
operating costs, capital-related costs would also be paid under a
prospective payment system effective with cost reporting periods
beginning on or after October 1, 1991. As required by section 1886(g)
of the Act, we replaced the reasonable cost-based payment methodology
with a prospective payment methodology for hospital inpatient capital-
related costs. Under the new methodology, effective for cost reporting
periods beginning on or after October 1, 1991, a predetermined payment
amount per discharge is made for Medicare inpatient capital-related
costs. (See subpart M of 42 CFR part 412, and the August 30, 1991,
final rule (56 FR 43358) for a complete discussion of the prospective
payment system for hospital inpatient capital-related costs.)
B. Major Contents of the Provisions of the June 2, 1995 Proposed Rule
On June 2, 1995, we published a proposed rule in the Federal
Register (60 FR 29202) setting forth proposed changes to the Medicare
hospital inpatient prospective payment systems for both operating costs
and capital-related costs, as well as changes affecting hospitals
excluded from those payment systems. The following is a summary of the
major changes that we proposed to make:
We proposed changes for FY 1996 DRG classifications and
relative weighting factors as required by section 1886(d)(4)(C) of the
Act.
We proposed to update the wage index for FY 1996. Specific
issues included allocation of general service salaries and hours to
excluded areas, and revisions to the wage index based on hospital
redesignations.
[[Page 45779]]
We also proposed revisions to the criteria for seeking
MGCRB reclassification and discussed comments received on alternative
labor market areas.
We discussed several provisions of the regulations in 42
CFR parts 412, 424, and 485 and set forth certain proposed changes
concerning the following:
--Payment for transfer cases.
--Rural referral centers.
--Determination of number of beds in determining the indirect medical
education adjustment.
--Disproportionate share adjustment.
--Essential access community hospitals (EACHs) and rural primary care
hospitals (RPCHs).
--Rebasing the hospital market baskets.
We discussed several provisions of the regulations in 42
CFR part 412 concerning the prospective payment system for capital
related costs and set forth certain proposed changes concerning the
following:
--New update framework.
--Specific adjustment for taxes to the capital prospective payment
system Federal rate.
We discussed changes to the regulations at 42 CFR parts
412 and 413 for hospitals and hospital units excluded from the
prospective payment system. The proposed changes concerned the
following:
--Requirements for certain long-term care hospitals excluded from the
prospective payment systems.
--Payment window for preadmission services.
--Criteria for exclusion.
--Request for payment adjustment.
In the addendum to the proposed rule, we set forth
proposed changes to the amounts and factors for determining the FY 1996
prospective payment rates for operating costs and capital-related
costs. We also proposed new update factors for determining the rate-of-
increase limits for cost reporting periods beginning in FY 1996 for
hospitals and hospital units excluded from the prospective payment
system.
In Appendix A of the proposed rule, we set forth an
analysis of the impact that the proposed changes would have on affected
entities.
In Appendix B of the proposed rule, we set forth our
technical appendix on the proposed FY 1996 capital acquisition model.
In Appendix C to the proposed rule as corrected (60 FR
39304, August 2, 1995), we included our report to Congress on our
initial estimate of an update factor for FY 1996 for both hospitals
included in and hospitals excluded from the prospective payment systems
as required by section 1886(e)(3)(B) of the Act.
As required by sections 1886 (e)(4) and (e)(5) of the Act,
in Appendix D, we provided our recommendation of the appropriate
percentage change for FY 1996 for the following:
--Large urban area and other area average standardized amounts (and
hospital-specific rates applicable to sole community hospitals) for
hospital inpatient services paid for under the prospective payment
system for operating costs.
--Target rate-of-increase limits to the allowable operating costs of
hospital inpatient services furnished by hospitals and hospital units
excluded from the prospective payment system.
In the proposed rule, we discussed in detail the March 1,
1995 recommendations made by the Prospective Payment Assessment
Commission (ProPAC). ProPAC is directed by section 1886(e)(2)(A) of the
Act to make recommendations on the appropriate percentage change factor
to be used in updating the average standardized amounts. In addition,
section 1886(e)(2)(B) of the Act directs ProPAC to make recommendations
regarding changes in each of the Medicare payment policies under which
payments to an institution are prospectively determined. In particular,
the recommendations relating to the hospital inpatient prospective
payment systems are to include recommendations concerning the number of
DRGs used to classify patients, adjustments to the DRGs to reflect
severity of illness, and changes in the methods under which hospitals
are paid for capital-related costs. Under section 1886(e)(3)(A) of the
Act, the recommendations required of ProPAC under sections 1886(e)(2)
(A) and (B) of the Act are to be reported to Congress not later than
March 1 of each year.
We printed ProPAC's March 1, 1995 report, which included its
recommendations, as Appendix E of the proposed rule. The
recommendations, and the actions we proposed to take with regard to
them (when an action is recommended), were discussed in detail in the
appropriate sections of the preamble, the addendum, or the appendices
to the proposed rule. Set forth below in sections II, III, IV, V, VI,
and VII of this preamble, the addendum to this final rule, and the
appendices are detailed discussion of the June 2 proposed rule, the
public comments received in response to the proposed rule, and the
responses to those comments, as well as the changes we are making.
C. Public Comments Received in Response to the June 2 Proposed Rule
A total of 2,006 items of correspondence containing comments on the
proposed rule were received timely. Two issues, physician attestation
of hospital patient claims and the DRG classification of the procedure
for insertion of a coronary artery stent, were the subject of write-in
campaigns. We received close to 1,000 letters on physician attestation
and over 700 letters on coronary stent. Of the remaining letters, the
main areas of concern addressed by the commenters were the following:
The adjustment for taxes to the capital prospective
payment system Federal rate.
The new requirements for certain long-term hospitals
excluded from the prospective payment system.
The discussion on the definition of a transfer case.
II. Changes to DRG Classifications and Relative Weights
A. Background
Under the prospective payment system, we pay for inpatient hospital
services on the basis of a rate per discharge that varies by the DRG to
which a beneficiary's stay is assigned. The formula used to calculate
payment for a specific case takes an individual hospital's payment rate
per case and multiplies it by the weight of the DRG to which the case
is assigned. Each DRG weight represents the average resources required
to care for cases in that particular DRG relative to the average
resources used to treat cases in other DRGs.
Congress recognized that it would be necessary to recalculate the
DRG relative weights periodically to account for changes in resource
consumption. Accordingly, section 1886(d)(4)(C) of the Act requires
that the Secretary adjust the DRG classifications and relative weights
annually. These adjustments are made to reflect changes in treatment
patterns, technology, and any other factors that may change the
relative use of hospital resources. The changes to the DRG
classification system and the recalibration of the DRG weights for
discharges occurring on or after October 1, 1995, are discussed below.
B. DRG Reclassification
1. General
Cases are classified into DRGs for payment under the prospective
payment
[[Page 45780]]
system based on the principal diagnosis, up to eight additional
diagnoses, and up to six procedures performed during the stay, as well
as age, sex, and discharge status of the patient. The diagnosis and
procedure information is reported by the hospital using codes from the
International Classification of Diseases, Ninth Edition, Clinical
Modification (ICD-9-CM). The Medicare fiscal intermediary enters the
information into its claims system and subjects it to a series of
automated screens called the Medicare Code Editor (MCE). These screens
are designed to identify cases that require further review before
classification into a DRG can be accomplished.
After screening through the MCE and any further development of the
claims, cases are classified by the GROUPER software program into the
appropriate DRG. The GROUPER program was developed as a means of
classifying each case into a DRG on the basis of the diagnosis and
procedure codes and demographic information (that is, sex, age, and
discharge status). It is used both to classify past cases in order to
measure relative hospital resource consumption to establish the DRG
weights and to classify current cases for purposes of determining
payment. The records for all Medicare hospital inpatient discharges are
maintained in the Medicare Provider Analysis and Review (MedPAR) file.
The data in this file are used to evaluate possible DRG classification
changes and to recalibrate the DRG weights.
Currently, cases are assigned to one of 492 DRGs in 25 major
diagnostic categories (MDCs). Most MDCs are based on a particular organ
system of the body (for example, MDC 6, Diseases and Disorders of the
Digestive System); however, some MDCs are not constructed on this basis
since they involve multiple organ systems (for example, MDC 22, Burns).
In general, principal diagnosis determines MDC assignment. However,
there are five DRGs to which cases are assigned on the basis of
procedure codes rather than first assigning them to an MDC based on the
principal diagnosis. These are the DRGs for liver, bone marrow, and
lung transplant (DRGs 480, 481, and 495, respectively) and the two DRGs
for tracheostomies (DRGs 482 and 483). Cases are assigned to these DRGs
before classification to an MDC.
Within most MDCs, cases are then divided into surgical DRGs (based
on a surgical hierarchy that orders individual procedures or groups of
procedures by resource intensity) and medical DRGs. Medical DRGs
generally are differentiated on the basis of diagnosis and age. Some
surgical and medical DRGs are further differentiated based on the
presence or absence of complications or comorbidities (hereafter CC).
Generally, GROUPER does not consider other procedures; that is,
nonsurgical procedures or minor surgical procedures generally not
performed in an operating room are not listed as operating room (OR)
procedures in the GROUPER decision tables. However, there are a few
non-OR procedures that do affect DRG assignment for certain principal
diagnoses, such as extracorporeal shock wave lithotripsy for patients
with a principal diagnosis of urinary stones.
We proposed to make several changes to the DRG classification
system for FY 1996. These proposed changes, the comments we received
concerning them, our responses to those comments, and the final DRG
changes, are set forth below.
2. MDC 5 (Diseases and Disorders of the Circulatory System)
a. Automatic Implantable Cardioverter Defibrillator (AICD)
Procedures (DRG 116). For several years, we have received
correspondence regarding the appropriate DRG assignment of certain
procedures involving automatic implantable cardioverter defibrillators
(AICDs). When a patient whose principal diagnosis is classified to MDC
5 (Diseases and Disorders of the Circulatory System) receives a total
AICD system implant or replacement (procedure code 37.94), the case is
assigned to DRG 104 or 105 (Cardiac Valve Procedures With or Without
Cardiac Catheterization). However, for discharges occurring before
October 1, 1992, if a procedure was performed that involved the
implantation or replacement of only part of the AICD system (that is,
replacement or implant of either the leads or pulse generator only),
the case was assigned to DRG 120 (Other Circulatory System OR
Procedures). Effective with discharges occurring on or after October 1,
1992, these procedures were reclassified to DRG 116 (Other Permanent
Cardiac Pacemaker Implant or AICD Lead or Generator Procedure). In the
proposed rule, we presented our analysis of AICD cases based on FY 1994
MedPAR data. We concluded that these cases continue to be appropriately
assigned to DRG 116. Therefore, we did not propose any further changes
to the DRG assignment. We received two public comments on our analysis
and conclusion.
Comment: One commenter commended the continued assignment to DRG
116 of cases in which replacement or implantation of only part of the
AICD system is performed. However, the other commenter requested that
we change the DRG assignment for these cases to DRG 115 (Permanent
Cardiac Pacemaker Implantation with AMI, Heart Failure or Shock). The
second commenter stated that the resource use of these patients is
similar to those in DRG 115, even though the patients in DRG 115 have
much longer lengths of stay.
Response: Since reassignment of these procedures to DRG 116, we
have annually analyzed the cases based on the most recent data. Based
on data in the latest update of the FY 1994 MedPAR file (June 1995),
the average standardized charge for the 2,569 AICD cases assigned to
DRG 116 is $27,806. The average standardized charge for all cases in
DRG 116 is $19,637 and for DRG 115, is $29,086. The $8,169 difference
between the average charge for AICD cases in DRG 116 and all cases in
DRG 116 is within the normal range of charges for that DRG. (One
standard deviation from the mean of the charges for DRG 116 is
$10,512.) We note that, compared to last year's analysis using FY 1993
MedPAR data, the average charge for the AICD cases has decreased
slightly as has the difference in charges between all cases in DRG 116
and the AICD cases.
The average length of stay for the AICD cases in DRG 116 is 3.98
days compared to 5.89 days for all cases in DRG 116. However, the
length of stay for cases in DRG 115 is 11.8. In general, the patients
classified to DRG 115 are seriously ill and the long length of stay
supports this contention. We continue to believe that the AICD patients
are clinically much more similar to the patients classified to DRG 116
than to those in DRG 115 and that it is the cost of the AICD device
that is responsible for the high average charge for these cases and not
the intensity of hospital services required to treat the patient.
In the September 1, 1994 final rule (59 FR 45346), we stated our
belief that as new AICD devices were approved by the FDA and entered
the market, increased competition would result in a decrease in the
price of the devices and a corresponding drop in the average charge for
a hospital stay for AICD procedures. Second and third generations of
several manufacturers' devices are now on the market. In addition, we
believe that the slight decrease in average charges seen in the FY 1994
data compared to the FY 1993 data is a direct result of hospitals'
ability to obtain AICD devices from multiple sources. (The increase in
[[Page 45781]]
charges for AICD cases between the FY 1992 and FY 1993 data was
approximately $6,000.) Based on this evidence, we will continue to
assign the AICD implant cases to DRG 116 for FY 1996. However, we will
reassess this assignment as a part of our FY 1997 DRG analysis in order
to verify that the current pattern is maintained.
b. Sympathectomy Procedures. When performed in connection with a
principal diagnosis assigned to MDC 5, procedure code 05.24 (presacral
sympathectomy) is assigned to DRGs 478 and 479 (Other Vascular
Procedures) 1. However, the four other sympathectomy procedures
related to MDC 5 diagnoses are classified to DRG 120 (Other Circulatory
System OR Procedures). In order to improve clinical consistency, we
proposed to assign procedure code 05.24 to DRG 120 rather than to DRGs
478 and 479.
\1\ A single title combined with two DRG numbers is used to
signify pairs. Generally, the first DRG is for cases with CC and the
second DRG is for cases without CC. If a third number is included,
it represents cases of patients who are age 0-17. Occasionally, a
pair of DRGs is split on age >17 and age 0-17.
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We received one comment on this proposal, which supported our
proposed change. Therefore, we are adopting this change as final.
3. MDC 15 (Newborns and Other Neonates with Conditions Originating in
the Perinatal Period)
In the September 1, 1994, final rule (59 FR 45341), we stated our
intention to improve the classification and relative weights of the
DRGs that apply to newborns, children, and maternity patients. Because
the Medicare population does not include many of these individuals, the
original DRG classification system was developed from analysis of
claims data representative of the total inpatient population. Non-
Medicare discharge records from Maryland and Michigan hospitals were
used to calculate the original Medicare weights for the DRGs to which
newborns, children, and maternity patients are classified. Since that
time, because of the lack of Medicare data, these low-volume DRGs have
not been analyzed and refined, and the relative weights assigned to
them may no longer be entirely reflective of the resources needed to
treat patients.
Accordingly, we have acquired hospital claims data representative
of the total inpatient population for analysis and evaluation. These
data, collected and formatted by the Urban Institute under contract
with HCFA (Contract 500-92-0024), represent claims for non-Medicare
payers from 19 States. The data base contains approximately 17 million
discharge records. Using these data, we are evaluating possible
modifications to MDC 15 that would better address the requirements for
an all-patient population.
As we have not yet completed this evaluation, we did not propose an
MDC 15 DRG reclassification structure for FY 1996. However, we did
propose to adjust the DRG relative weights for 36 Medicare low-volume
DRGs (defined as those DRGs with fewer than 10 cases). These DRGs are
generally those assigned to patients age 0-17, many of the neonate and
newborn MDC 15 DRGs, and one DRG in MDC 14 (Pregnancy, Childbirth and
Puerperium). The proposed DRG relative weights for these low-volume
DRGs were calculated based on the non-Medicare data we acquired from
the 19 States. We note that, based on the June 1995 update to the FY
1994 MedPAR file, there are only 34 low-volume DRGs in the final
recalibration.
During the year, we have received suggestions from the public
concerning improvements for the neonate DRG classifications. Among
these suggestions have been recommendations concerning specific
diagnoses that are currently considered significant problems in
determining the assignment of a neonate case to DRG 390 (Neonate with
Other Significant Problems) rather than DRG 391 (Normal Newborn).
Another issue is the assignment to MDC 15 of discharges with a
principal diagnosis of certain congenital defects regardless of the age
of the patient. Because the MDC 15 modifications that we are
considering should resolve these concerns, we did not propose to revise
the assignment of these diagnoses and conditions. Rather, we indicated
that we would incorporate the necessary and appropriate assignment of
these cases with our overall modification of the neonate DRGs.
Comment: We received two comments on our proposal to base the
relative weights for low-volume DRGs on all patient data, both of which
supported our proposal. However, one of these commenters objected to
the proposed assignment of a weight of 0.1460 to DRG 391 (Normal
Newborn), the only DRG within MDC 15 for which the proposed relative
weight decreased compared to the previous year's weights. This
commenter stated that changes to the relative weight of DRG 391 should
be postponed until our evaluation of claims data has been completed.
Response: In previous years, we computed the weight for the low-
volume DRGs by adjusting the original weights of these DRGs as
calculated based on 1981 bills by the percentage change in the average
weight of the cases in the remaining DRGs. Thus, the weight for these
DRGs was not based solely on actual experience and was, in some cases,
artificially inflated. Using empirical data from more recent actual
claims resulted in figures that more accurately reflect current
utilization and resource use. We note that of the final 34 low-volume
DRGs, only 8 experienced an increase in relative weight based on the
all-patient data. Of these eight DRGs, four are in MDC 15. The decrease
in the relative weight for DRG 391 is the one exception within that
MDC. The decrease in weight is a function of the expanded data base and
the difference between applying an automatic percentage increase and
calculating a relative weight using an averaging process as we do for
the other DRGs. Taking into account the changes in practice for
treating normal newborns that have taken place over the last several
years, it is not surprising that the weight for DRG 391 has decreased.
In any case, we see no reason why we should adjust all the low-
volume weights to the new data except DRG 391. Therefore, we will
proceed with the proposed methodology for updating these weights.
4. MDC 24 (Multiple Significant Trauma)
Several years ago, we created a new MDC 24 to classify cases of
multiple significant trauma. In order to be assigned to this MDC, a
patient must have a principal diagnosis of trauma and at least two
significant trauma diagnosis codes from two different body sites
reported as either principal or secondary diagnoses. We recognize eight
different body site categories: head, chest, abdomen, kidney, urinary,
pelvis and spine, upper limb, and lower limb.
It was brought to our attention that diagnosis code 851.06
(Cerebral cortex contusion with loss of consciousness of unspecified
duration) was excluded from the list of diagnoses that count as
principal or secondary diagnoses in the significant head trauma section
of MDC 24. Because this code is clinically similar to those already on
the list of principal or secondary diagnoses that cause assignment to
DRG 487 (Other Multiple Significant Trauma), we proposed to add this
diagnosis to the significant head trauma list effective with discharges
occurring on or after October 1, 1995.
The one comment we received in response to this proposal stated
that the change was appropriate. Thus, we have
[[Page 45782]]
included this change in the final DRG classifications.
5. Surgical Hierarchies
Some inpatient stays entail multiple surgical procedures, each one
of which, occurring by itself, could result in assignment of the case
to a different DRG within the MDC to which the principal diagnosis is
assigned. It is, therefore, necessary to have a decision rule by which
these cases are assigned to a single DRG. The surgical hierarchy, an
ordering of surgical classes from most to least resource intensive,
performs that function. Its application ensures that cases involving
multiple surgical procedures are assigned to the DRG associated with
the most resource-intensive surgical class.
Because the relative resource intensity of surgical classes can
shift as a function of DRG reclassification and recalibration, we
reviewed the surgical hierarchy of each MDC, as we have for previous
reclassifications, to determine if the ordering of classes coincided
with the intensity of resource utilization, as measured by the same
billing data used to compute the DRG relative weights.
A surgical class can be composed of one or more DRGs. For example,
in MDC 5, the surgical class ``heart transplant'' consists of a single
DRG (DRG 103) and the class ``coronary bypass'' consists of two DRGs
(DRGs 106 and 107). Consequently, in many cases, the surgical hierarchy
has an impact on more than one DRG. The methodology for determining the
most resource-intensive surgical class, therefore, involves weighting
each DRG for frequency to determine the average resources for each
surgical class. For example, assume surgical class A includes DRGs 1
and 2 and surgical class B includes DRGs 3, 4, and 5, and that the
average charge of DRG 1 is higher than that of DRG 3, but the average
charges of DRGs 4 and 5 are higher than the average charge of DRG 2. To
determine whether surgical class A should be higher or lower than
surgical class B in the surgical hierarchy, we would weight the average
charge of each DRG by frequency (that is, by the number of cases in the
DRG) to determine average resource consumption for the surgical class.
The surgical classes would then be ordered from the class with the
highest average resource utilization to that with the lowest, with the
exception of ``other OR procedures'' as discussed below.
This methodology may occasionally result in a case involving
multiple procedures being assigned to the lower-weighted DRG (in the
highest, most resource-intensive surgical class) of the available
alternatives. However, given that the logic underlying the surgical
hierarchy provides that the GROUPER searches for the procedure in the
most resource-intensive surgical class, which may sometimes occur in
cases involving multiple procedures, this result is unavoidable.
We note that, notwithstanding the foregoing discussion, there are a
few instances when a surgical class with a lower average relative
weight is ordered above a surgical class with a higher average relative
weight. For example, the ``other OR procedures'' surgical class is
uniformly ordered last in the surgical hierarchy of each MDC in which
it occurs, regardless of the fact that the relative weight for the DRG
or DRGs in that surgical class may be higher than that for other
surgical classes in the MDC. The ``other OR procedures'' class is a
group of procedures that are least likely to be related to the
diagnoses in the MDC but are occasionally performed on patients with
these diagnoses. Therefore, these procedures should only be considered
if no other procedure more closely related to the diagnoses in the MDC
has been performed.
A second example occurs when the difference between the average
weights for two surgical classes is very small. We have found that
small differences generally do not warrant reordering of the hierarchy
since, by virtue of the hierarchy change, the relative weights are
likely to shift such that the higher-ordered surgical class has a lower
average weight than the class ordered below it.
Based on the preliminary recalibration of the DRGs, we proposed to
modify the surgical hierarchy as set forth below:
In MDC 2 (Diseases and Disorders of the Eye), we proposed
to reorder Extraocular Procedures Except Orbit (DRGs 40 and 41) above
Retinal Procedures (DRG 36).
In MDC 8 (Diseases and Disorders of the Musculoskeletal
System and Connective Tissue), we proposed to reorder Major Thumb or
Joint Procedures or Other Hand or Wrist Procedures with CC (DRG 228)
above Major Shoulder/Elbow Procedures or Other Upper Extremity
Procedures with CC (DRG 223).
We received one comment in support of both surgical hierarchy
changes. In addition, based on a test of the proposed changes using the
most recent MedPAR file and the revised GROUPER software, we have found
that the changes are still supported by the data and no additional
changes are indicated. Therefore, we are now incorporating the proposed
surgical hierarchy as final.
6. Refinement of Complications and Comorbidities List
a. Addition or Deletion of CCs. There is a standard list of
diagnoses that are considered complications or comorbidities (CCs). We
developed this list using physician panels to include those diagnoses
that, when present as a secondary condition, would be considered a
substantial complication or comorbidity. In preparing the original CC
list, a substantial CC was defined as a condition that, because of its
presence with a specific principal diagnosis, would increase the length
of stay by at least 1 day for at least 75 percent of the patients.
Based upon clinical review by our medical consultants and analysis
of charge data, we proposed to revise the list of diagnoses that are
considered CCs as follows:
We proposed to add diagnosis code 008.49 (Bacterial
enteritis) to the CC list. This diagnosis would be considered a CC for
any principal diagnosis not shown in Table 6f, Addition to the CC
Exclusions List (see discussion of CC Exclusions list in section V of
the addendum below).
We proposed to delete diagnosis code 276.8
(Hypopotassemia) from the CC list. This diagnosis would no longer be
considered a CC for any principal diagnosis.
Comment: We received one comment that supported our addition of
diagnosis code 008.49 to the list of CCs. However, two commenters
disagreed with our proposal to remove diagnosis code 276.8 from the
list. The commenters state that hypokalemia, which is one of the
conditions coded to 276.8, is a serious medical condition that can
complicate a patient's treatment and increase the length of stay.
Response: We agree that severe cases of hypokalemia can affect a
patient's clinical course. However, based on our analyses and the
judgment of our expert medical advisors, we believe that when a patient
has a case of hypokalemia severe enough to affect the clinical course
of treatment, there will be additional manifestations of the condition.
Thus, we expect that in such cases, in addition to an abnormal
laboratory report finding of low potassium, the patient will have other
manifestations of this condition, many of which are coded to diagnoses
considered to be CCs. Therefore, we believe that a patient with severe
hypoalemia will be classified to a CC DRG based on his other secondary
diagnoses. However, an abnormal
[[Page 45783]]
laboratory finding of low potassium, which is one of the conditions
coded to 276.8, does not by itself generally result in increased
resource use.
Comment: One commenter requested that we add the following
diagnoses to the CC list:
008.45 Clostridium difficile
331.0 Alzheimer's disease
423.9 Unspecified disease of the pericardium
348.5 Cerebral edema
333.4 Huntington's chorea
458.0 Orthostatic hypotension
458.9 Hypotension, not otherwise specified
In addition, the commenter suggested that the following diagnoses
be added as CCs for DRGs 121 and 122 only:
434.xx Occlusion of cerebral arteries
436 Acute but ill-defined, cerebrovascular disease
Response: Our analysis of FY 1994 MedPAR data did not support
granting CC status to these diagnoses. However, we have limited
Medicare data on several of these codes. We will reevaluate these codes
as part of our DRG analysis for FY 1997.
b. CC Exclusion List. We proposed a limited revision of the CC
Exclusions List to take into account the changes that will be made in
the ICD-9-CM diagnosis coding system effective October 1, 1995, as well
as the proposed CC changes in Section II.B.6.a. described above. (See
section II.B.8 for a discussion of the diagnosis coding system
changes.) The proposed revisions were made in accordance with the
principles established when we created the CC Exclusions List in 1987.
Tables 6G and 6H in section V of the addendum to this final rule
contain the revisions to the CC Exclusions List that will be effective
for discharges occurring on or after October 1, 1995. Each table shows
the principal diagnoses with changes to the excluded CCs. Each of these
principal diagnoses is shown with an asterisk, and the additions or
deletions to the CC Exclusions List are provided in an indented column
immediately following the affected principal diagnosis.
CCs that are added to the list are in Table 6G--Additions to the CC
Exclusions List. Beginning with discharges occurring on or after
October 1, 1995, the indented diagnoses will not be recognized by the
GROUPER as valid CCs for the asterisked principal diagnosis.
CCs that are deleted from the list are in Table 6H--Deletions from
the CC Exclusions List. Beginning with discharges occurring on or after
October 1, 1995, the indented diagnoses will be recognized by the
GROUPER as valid CCs for the asterisked principal diagnosis.
Copies of the original CC Exclusions List applicable to FY 1988 can
be obtained from the National Technical Information Service (NTIS) of
the Department of Commerce. It is available in hard copy for $84.00,
plus $6.00 for shipping and handling and on microfiche for $20.50, plus
$4.00 for shipping and handling. A request for the FY 1988 CC
Exclusions List (which should include the identification accession
number (PB) 88-133970) should be made to the following address:
National Technical Information Service; U.S. Department of Commerce;
5285 Port Royal Road, Springfield, VA 22161; or by calling (703) 487-
4650.
Users should be aware of the fact that all revisions to the CC
Exclusions List (FYs 1989, 1990, 1991, 1992, 1993, 1994, and 1995) and
those in Tables 6G and 6H of this document must be incorporated into
the list purchased from NTIS in order to obtain the CC Exclusions List
applicable for discharges occurring on or after October 1, 1995.
Alternatively, the complete documentation of the GROUPER logic,
including the current CC Exclusions List, is available from 3M/Health
Information Systems (HIS), which, under contract with HCFA, is
responsible for updating and maintaining the GROUPER program. The
current DRG Definitions Manual, Version 13.0, which includes the
changes set forth in this final rule, is available for $195.00, which
includes $15.00 for shipping and handling. Manuals may be obtained by
writing 3M/HIS at: 100 Barnes Road; Wallingford, CT 06492; or by
calling (203) 949-0303.
7. Review of Procedure Codes in DRGs 468, 476, and 477
Each year, we review cases assigned to DRG 468 (Extensive OR
Procedure Unrelated to Principal Diagnosis), DRG 476 (Prostatic OR
Procedure Unrelated to Principal Diagnosis), and DRG 477 (Nonextensive
OR Procedure Unrelated to Principal Diagnosis) in order to determine
whether it would be appropriate to change the procedures assigned among
these DRGs.
DRGs 468, 476, and 477 are reserved for those cases in which none
of the OR procedures performed is related to the principal diagnosis.
These DRGs are intended to capture atypical cases, that is, those cases
not occurring with sufficient frequency to represent a distinct,
recognizable clinical group. DRG 476 is assigned to those discharges in
which one or more of the following prostatic procedures are performed
and are unrelated to the principal diagnosis:
60.0 Incision of prostate
60.12 Open biopsy of prostate
60.15 Biopsy of periprostatic tissue
60.18 Other diagnostic procedures on prostate and periprostatic tissue
60.2 Transurethral prostatectomy
60.61 Local excision of lesion of prostate
60.69 Prostatectomy NEC
60.81 Incision of periprostatic tissue
60.82 Excision of periprostatic tissue
60.93 Repair of prostate
60.94 Control of (postoperative) hemorrhage of prostate
60.95 Transurethral balloon dilation of the prostatic urethra
60.99 Other operations on prostate
All remaining OR procedures are assigned to DRGs 468 and 477, with
DRG 477 assigned to those discharges in which the only procedures
performed are nonextensive procedures that are unrelated to the
principal diagnosis. The original list of the ICD-9-CM procedure codes
for the procedures we consider nonextensive procedures if performed
with an unrelated principal diagnosis was published in Table 6c in
section IV of the addendum to the September 30, 1988 final rule (53 FR
38591). As part of the final rules published on September 4, 1990,
August 30, 1991, September 1, 1992, September 1, 1993, and September 1,
1994, we moved several other procedures from DRG 468 to 477. (See 55 FR
36135, 56 FR 43212, 57 FR 23625, 58 FR 46279, and 59 FR 45336,
respectively.)
a. Adding Procedure Codes to MDCs. We annually conduct a review of
procedures producing DRG 468 or 477 assignments on the basis of volume
of cases in these DRGs with each procedure. Our medical consultants
then identify those procedures occurring in conjunction with certain
principal diagnoses with sufficient frequency to justify adding them to
one of the surgical DRGs for the MDC in which the diagnosis falls. This
year's review did not identify any necessary changes; therefore, we did
not propose to move any procedures from DRG 468 or DRG 477 to one of
the surgical DRGs.
b. Reassignment of Procedures Among DRGs 468, 476, and 477. We also
reviewed the list of procedures that produce assignments to each of DRG
468, 476, and 477 to ascertain if any of those procedures should be
moved to one of the other DRGs based on average charges and length of
stay. Generally, we move only those procedures for which we have an
adequate number of discharges to analyze the data. Based on
[[Page 45784]]
our review this year, we proposed to move a limited number of
procedures.
In reviewing the list of OR procedures that produce DRG 468
assignments, we analyzed the average charge and length of stay data for
cases assigned to that DRG to identify those procedures that are more
similar to the discharges that currently group to either DRG 476 or
477. We identified several procedures that are significantly less
resource intensive than the other procedures assigned to DRG 468. These
procedures occur in the same ``family'' (that is, they relate to
procedures on the same body part or system) and at least one of this
family of codes is already present within DRG 477. Therefore, we
proposed to move the following procedures to the list of procedures
that result in assignment to DRG 477:
18.21 Excision of preauricular sinus
18.31 Radical excision of lesion of external ear
18.39 Other excision of external ear
18.5 Surgical correction of prominent ear
18.6 Reconstruction of external auditory canal
18.71 Construction of auricle of ear
18.72 Reattachment of amputated ear
18.9 Other operations of external ear
We conducted a similar analysis of the procedures that are assigned
to DRG 477 to determine if any of those procedures might more
appropriately be classified to DRG 468. Again, we analyzed charge and
length of stay data to identify procedures that were more similar to
discharges assigned to DRG 468 than to those classified in DRG 477. We
did not identify any procedures in DRG 477 that should be assigned to
DRG 468.
Comment: We received one comment that objected to our proposed move
of procedure codes 18.21, 18.31, 18.39, 18.5, 18.6, 18.71, 18.72, 18.9
from DRG 468 to DRG 477. The commenter did not indicate the basis of
the objections.
Response: In analyzing the procedures that produce assignments to
each of DRG 468, 476, and 477 for possible reassignment, we evaluate
both average charge and length of stay, as well as clinical evaluation
to determine the appropriate classification. These procedure codes were
significantly less resource intensive than other procedures assigned to
DRG 468, and more closely resembled the average charge and length of
stay for procedures classified to DRG 477. Our data continue to support
the reclassification of these procedures to DRG 477. Therefore, we are
reassigning these procedures from DRG 468 to DRG 477 as proposed.
All of the reassignments of procedures in DRGs 468 and 477 will be
effective with discharges occurring on or after October 1, 1995.
8. Changes to the ICD-9-CM Coding System
As discussed above in section II.B.1 of this preamble, the ICD-9-CM
is a coding system that is used for the reporting of diagnoses and
procedures performed on a patient. The ICD-9-CM Coordination and
Maintenance Committee, a Federal interdepartmental committee formed in
1985, is charged with the mission of maintaining and updating the ICD-
9-CM. That mission includes approving coding changes, and developing
errata, addenda, and other modifications to the ICD-9-CM to reflect
newly developed procedures and technologies and newly identified
diseases. The Committee is also responsible for promoting the use of
Federal and non-Federal educational programs and other communication
techniques with a view toward standardizing coding applications and
upgrading the quality of the classification system.
The Committee is co-chaired by the National Center for Health
Statistics (NCHS) and HCFA. The NCHS has lead responsibility for the
ICD-9-CM diagnosis codes included in Volume 1--Diseases: Tabular List
and Volume 2--Diseases: Alphabetic Index, while HCFA has lead
responsibility for the ICD-9-CM procedure codes included in Volume 3--
Procedures: Tabular List and Alphabetic Index.
The Committee encourages participation in the above process by
health-related organizations. In this regard, the Committee holds
public meetings for discussion of educational issues and proposed
coding changes. These meetings provide an opportunity for
representatives of recognized organizations in the coding fields, such
as the American Health Information Management Association (AHIMA)
(formerly American Medical Record Association (AMRA)), the American
Hospital Association (AHA), and various physician specialty groups as
well as physicians, medical record administrators, health information
management professionals, and other members of the public to contribute
ideas on coding matters. After considering the opinions expressed at
the public meetings and in writing, the Committee formulates
recommendations, which then must be approved by the agencies.
The Committee presented proposals for FY 1996 coding changes at
public meetings held on May 5 and December 1 and 2, 1994, and finalized
the coding changes after consideration of comments received at the
meetings and in writing within 30 days following the December 1994
meeting. The initial meeting for consideration of coding issues for
implementation in FY 1997 was held on May 4, 1995. Copies of the
minutes of these meetings may be obtained by writing to one of the co-
chairpersons representing NCHS and HCFA. We encourage commenters to
address suggestions on coding issues involving diagnosis codes to: Sue
Meads, Co-Chairperson; ICD-9-CM Coordination and Maintenance Committee;
NCHS; Rm. 9-58; 6525 Belcrest Road; Hyattsville, MD 20782.
Questions and comments concerning the procedure codes should be
addressed to: Patricia E. Brooks, Co-Chairperson; ICD-9-CM Coordination
and Maintenance Committee; HCFA, Office of Hospital Policy; Division of
Prospective Payment System; Room C5-06-27; 7500 Security Boulevard;
Baltimore, MD 21244-1850.
The ICD-9-CM code changes that have been approved will become
effective October 1, 1995. The new ICD-9-CM codes are listed, along
with their DRG classifications, in Tables 6a and 6b (New Diagnosis
Codes and New Procedure Codes, respectively) in section V of the
addendum to this final rule. As we stated above, the code numbers and
their titles were presented for public comment in the ICD-9-CM
Coordination and Maintenance Committee meetings. Both oral and written
comments were considered before the codes were approved. Therefore, we
solicited comments on the proposed DRG classifications only.
Further, the Committee has approved the expansion of certain ICD-9-
CM codes to require an additional digit for valid code assignment.
Diagnosis codes that have been replaced by expanded codes, other codes,
or have been deleted, are in Table 6c (Invalid Diagnosis Codes). The
procedure codes that have been replaced by expanded codes or have been
deleted are in Table 6d (Invalid Procedure Codes). These invalid
diagnosis and procedure codes will not be recognized by the GROUPER
beginning with discharges occurring on or after October 1, 1995. The
corresponding new or expanded codes are included in Tables 6a and 6b.
Revisions to diagnosis and procedure code titles are in Tables 6e
(Revised Diagnosis Code Titles) and 6f (Revised Procedure Code Titles),
which also include the DRG assignments for these revised codes.
There are three new procedure codes that were previously included
in codes
[[Page 45785]]
classified as operating room procedures even though the specific
procedures specified by the new codes may not be routinely performed in
an operating room. The three codes are as follows:
48.36 [Endoscopic] polypectomy of rectum
59.72 Injection of implant into urethra and/or bladder neck
92.3 Stereotactic radiosurgery
In the proposed rule, these three new codes were classified as non-
OR procedures that affect DRG assignment and are indicated as such in
Table 6b--New Procedure Codes. We will continue to assign these three
codes to the surgical DRGs to which they are currently assigned.
Comment: We received over 700 comments requesting that we assign
cases involving the insertion of a coronary artery stent along with
percutaneous transluminal coronary angioplasty (PTCA) to a different
DRG than conventional PTCA. These cases are all currently assigned to
DRG 112 (Percutaneous Cardiovascular Procedures). The commenters stated
that hospital costs for inserting coronary stents along with an
angioplasty are significantly greater than those for conventional
angioplasty alone and the clinical results of the stent implantation
are significantly better, leading to a reduction in the need for repeat
interventions and to improved quality of care. These comments are based
on two studies that were published in the August 25, 1994, New England
Journal of Medicine as well the results of an analysis commissioned by
the manufacturer of one of the two stent devices currently approved by
the Food and Drug Administration (FDA).
In this latter analysis, the contractor used the Medicare cases
reported to DRG 112 in the FY 1994 MedPAR file and information provided
voluntarily by 19 hospitals on interventional catheter procedures
performed between July 1, 1994, and September 30, 1994, including
information on coronary stent implantation. By matching the individual
hospital data to the MedPAR file, the contractor identified 655 cases
of PTCA, 68 of which involved insertion of a stent device. The
following are the findings of the analysis:
The difference between the average length of stay for the
stent cases and the non-stent cases is 2.8 days (7.7 days versus 4.9
days).
The difference between the average standardized charges
for stent cases and non-stent cases was approximately $8,500 ($22,500
versus $14,000).
The contractor projects that approximately 10 percent of
the PTCA cases assigned to DRG 112 during FY 1996 will receive a stent,
resulting in approximately 10,000 stent cases.
One commenter stated that section 1886(d)(4)(C) of the Act gives
HCFA the authority to adjust the DRG classifications and relative
weights annually to ``reflect changes in treatment patterns,
technology, and other factors that may change the relative use of
hospital resources.'' Because insertion of the coronary stent is both a
new technology and a change in treatment patterns, the commenter
believes that we have a duty to revise the DRG classification for this
procedure.
The commenter also noted that we have used this authority in the
past, citing two other changes made in response to technology changes.
Effective for discharges occurring in FY 1993, we reclassified certain
automatic implantable cardiac defibrillator (AICD) cases from DRG 120
(Other Circulatory System OR Procedures) to DRG 116 (Other Permanent
Cardiac Pacemaker Implant or AICD Lead or Generator Procedure). (See 57
FR 39749, September 1, 1992.) The commenter stated that this change was
made in response to complaints that hospitals were not adequately
compensated for these procedures. Also, effective for discharges
occurring in FY 1987, we reclassified all extracorporeal shockwave
lithotripsy (ESWL) cases to DRG 323 (Urinary Stones with CC and/or
ESWL) even in the absence of a CC (which would have resulted in
classification to DRG 324 (Urinary Stones without CC)). (See 51 FR
31485, September 3, 1986.) The commenter stated that we made this
change even though we did not conduct an analysis of Medicare data and
instead relied on an outside source for the analysis. Thus, the
commenter believes that HCFA could make a change in the assignment of
stent cases even though HCFA cannot, at this time, conduct a complete
analysis based on Medicare data. The commenter requested that a
separate DRG be created for coronary stent implantation and that
payment be established at a level that is appropriate for the cost of
the procedure.
We received one comment supporting our proposed assignment of
coronary stent implant as non-OR. The commenter stated that the
published studies that were the basis for FDA approval do not show an
overwhelming improvement in any clinical event when a stent was used in
place of balloon PTCA. Thus, the commenter believes that it is obvious
that coronary stenting is not a ``good buy,'' and further studies are
needed.
Response: Currently, the insertion of coronary stents are included
in the codes for PTCA (procedure codes 36.01, 36.02, and 36.05). That
is, there is no separate code to indicate that a coronary stent was
inserted during a PTCA procedure. Therefore, at this time, we cannot
identify which PTCA cases in the MedPAR file include insertion of a
stent. Effective October 1, 1995, a new procedure code for insertion of
a coronary stent (code 36.06) will be introduced. We have designated
this code as non-OR and have not assigned it to a specific DRG (see
Table 6b in section V of the addendum to this final rule). However,
since it is always performed in connection with PTCA, the cases will
continue to be assigned to DRG 112.
When a new code is introduced, our longstanding practice is to
assign it to the same DRG category as its predecessor code. One
compelling reason for this practice is our inability to move the cases
associated with a new code to a new DRG assignment as part of DRG
reclassification and recalibration. We have discussed this policy in
several previous rules, most recently in the September 1, 1994, final
rule (59 FR 45340).
Since coronary angioplasty with stent is currently assigned
currently to the same DRG as those without stent, this classification
will continue until data on the new procedure code are available.
Hospitals will begin coding claims with procedure code 36.06 beginning
with discharges in FY 1996. Therefore, the resource use and other data
associated with that code will be available to us for analysis as part
of the FY 1998 DRG changes. We will evaluate the DRG assignment of
coronary stent insertion at that time.
We agree with the commenter who stated that section 1886(d)(4)(C)
of the Act gives HCFA the authority to adjust DRG classification and
relative weights. In fact, that section of the law requires that the
Secretary adjust the DRG classifications and relative weights annually.
However, we virtually always limit our adjustments to those that are
supported by Medicare data we have collected through the claims
submittal process. Although the change in DRG assignment for AICD
procedures was requested by commenters because they did not believe
that the payment associated with DRG 120 was adequate compensation, the
revision in DRG assignment was based on our analysis of the FY 1991
MedPAR data. In fact, we had conducted other analyses of these cases in
several previous years that did not support a DRG change. (See final
rules published September 1, 1989 (54
[[Page 45786]]
FR 36465), September 4, 1990 (55 FR 36023), and August 30, 1991 (56 FR
43216).)
Concerning the change for ESWL cases made effective October 1,
1986, we note that this revision was made in response to a ProPAC
recommendation and was based on ProPAC's analysis, which found that
payment under DRG 324 substantially understated the cost of ESWL. As
discussed in detail in the September 3, 1986 final rule, a commenter
had requested that the ESWL cases be assigned to a separate DRG based
on a study conducted by the National Health Services and Practice
Pattern Survey (51 FR 31486). Our response was that we are generally
opposed to the creation of a single procedure DRG and that ``. . . this
avenue should be employed only if there is substantial evidence of
inequity through classification in any of the existing clinically
consistent groupings.'' In addition, we stated that we intended ``. . .
to monitor ESWL closely as Medicare data become available. If it
becomes apparent that reclassification is necessary in the future, we
will consider the alternative of developing a specific DRG for ESWL
among the options for reclassification.'' We note that, since 1986, the
assignment of ESWL has never been revised.
We intend to maintain the non-OR designation of procedure code
36.06 until we have collected claims data from all hospitals performing
this procedure, which will be available in 1997. We will carefully
examine these data as part of our analysis of DRG changes for FY 1998
and we will discuss our findings in the FY 1998 proposed rule.
9. DRG Refinements
For several years, we have been analyzing major refinements to the
DRG classification system to compensate hospitals more equitably for
treating severely ill Medicare patients. These refinements, generally
referred to as severity of illness adjustments, would create DRGs
specifically for hospital discharges involving very ill patients who
consume far more resources than do other patients classified to the
same DRGs in the current system. This approach has been taken by
various other groups in refining the Medicare DRG system to include
severity measurements, most notably the research done for Yale, the
changes incorporated by the State of New York into its all patient (AP)
DRG system, and the all-patient refined (APR) DRGs, which are a joint
effort of 3M/HIS and the National Association of Children's Hospitals
and Related Institutions.
In the May 27, 1994, proposed rule, we announced the availability
of a paper we had prepared that describes our preliminary severity DRG
classification system as well as the analysis upon which our proposal
was formulated. Comments were due to HCFA by September 30, 1994. We
received 99 individual letters commenting on the DRG refinements. Many
of the commenters supported the change in theory, but there were
numerous specific comments on the methodology.
Our plan was to incorporate comments and suggestions we received
and to consider proposing the complete revised DRG system as part of
the FY 1996 prospective payment system proposed rule. However, as the
final rule published on September 1, 1992 (57 FR 39761) indicated, we
would not propose to make significant changes to the DRG classification
system unless we were able either to improve our ability to predict
coding changes by validating in advance the impact that potential DRG
changes may have on coding behavior, or to make methodological changes
to prevent building the inflationary effects of the coding changes into
future program payments.
Besides the mandate of section 1886(d)(4)(C)(iii) of the Act, which
provides that aggregate payments may not be affected by DRG
reclassification and recalibration changes, we do not believe it is
prudent policy to make changes for which we cannot predict the effect
on the case-mix index and, thus, payments. Our goal is to refine our
methodology so that we can fulfill, in the most appropriate manner,
both the statutory requirement to make appropriate DRG classification
changes and to recalibrate DRG relative weights (as mandated by section
1886(d)(4)(C) of the Act) as well as to make DRG changes in a budget
neutral manner.
One approach to this problem would be to maintain the average case
weight at 1.0 after recalibration, thereby eliminating the process of
normalization. In other words, after recalibration, we would not scale
the new relative weights upward to carry forward the cumulative effects
of past case-mix increases. We would, instead, make an adjustment or
include in the annual update factor a specific allowance for any real
case-mix change that occurred during the previous year. This is a
relatively simple and straightforward system for preventing the effects
of year-to-year increase in the case-mix index from accumulating in the
DRG weights and to account for expected changes in coding practice. In
addition, we are exploring a means of estimating anticipated case-mix
change due to changes in coding practice that are a result of DRG
classification revisions. (See section VII.E of this preamble for a
more detailed description of this process in response to a ProPAC
recommendation.) However, since we have not yet resolved these issues,
we were unable to propose our refined DRG severity system for FY 1996.
We will continue to analyze the comments we received and validate our
previous research with later MedPAR data. We remain committed to
proposing our revised system as soon as possible.
We received several comments on our plan to introduce refinements
to the DRG classification to include a measure of severity. In general,
these comments were supportive of the concept of a severity-adjusted
DRG system to improve compensation for the treatment of severely ill
patients.
Comment: One commenter supported HCFA's decision to postpone a
final proposal until all related issues were resolved. Another
commenter stated we should not postpone new refinements on the basis of
political reasons that arise due to shifts in payments. Other
commenters, while stating appreciation of our desire to predict
beforehand the effect of severity changes on coding behavior, urged us
to resolve the issues regarding the effect of severity-adjusted DRGs on
case mix, payment, and budget neutrality. One commenter stated we
should set standards for ``predictive accuracy'' that are reasonable
and attainable.
Response: We continue to maintain our position that, until we can
improve our ability to predict coding changes, or prevent inflationary
effects of coding change through methodological changes to DRG
recalibration, we will not propose any significant changes to the DRG
classification system. However, we note that we have continued to
evaluate approaches to resolve this issue.
One approach to improving our ability to predict coding changes is
to develop a data base of abstracted medical records to be used to
estimate the real and coding components of case-mix change and to
forecast future coding improvements. As we stated in the proposed rule
(60 FR 29247), HCFA has recently implemented a record reabstracting
process being conducted by two clinical data abstraction centers
(CDACs) under contract with the Health Standards and Quality Bureau
(HSQB). This will provide a data base consisting of 30,000 records per
year. When we have evaluated the results of this reabstracting effort,
we will determine if it is suitable for predicting coding
[[Page 45787]]
behavior. We believe we are proceeding at an appropriate pace that will
result in both reasonable and attainable predictive standards.
As to the statement that HCFA should not postpone DRG refinements
because of political reasons due to payment shifts, we note that we are
constricted by the mandate of section 1886(d)(4)(C)(iii) of the Act,
which provides that aggregate payments may not be affected by DRG
reclassification and recalibration changes. We have experienced severe
inflationary effects in prior years (see the September 1, 1989, final
rule for a discussion of the inflationary effect of the FY 1987 DRG
changes (54 FR 36468)), and reiterate our position that it would not be
prudent payment policy to make changes for which we cannot predict nor
control the effects.
Comment: One commenter recommended that HCFA issue a GROUPER that
includes the severity refinements for review and comment by the
industry.
Response: We believe it would be neither cost effective nor
efficient to issue a GROUPER preliminary to a decision to proceed with
the severity refinements. Thus, because the severity methodology is
still in the preliminary planning stages, we have not prepared a public
use GROUPER for release. The figures used in the initial analysis will
be subject to change based on more current data and to modification
based on comments received. At such time as the severity-adjusted
methodology is officially implemented, a GROUPER will be made
available. This is consistent with HCFA policy on the availability of
GROUPER software for other modifications to the DRG classification
system. We note that we made a complete FY 1992 MedPAR file with the
current and revised (severity) DRG designations available to the public
as part of the May 27, 1994 proposed rule (59 FR 27756).
10. Other Issues
a. Epilepsy (DRGs 24, 25, and 26). Comment: We received two
comments concerning the classification in DRGs 24, 25, and 26 (Seizure
and Headache) of patients with intractable epilepsy, specifically those
admitted for neurodiagnostic monitoring. The commenters believe that a
revision to the existing DRGs is necessary to account for the greater
resource use and length of stay for these patients. The commenters
stated that the financial risk is greatest in DRG 25, the DRG most
commonly used by specialized centers to evaluate patients, and that
these patients are typically under age 40.
The commenters referred to an analysis conducted by HCFA based on
FY 1993 Medicare data that indicated that the charges for cases
assigned to DRG 25 were twice as great per patient for intractable
epilepsy patients with monitoring than for all other patients in that
DRG. This analysis was discussed in the September 1, 1994, final rule
(59 FR 45343). Based on these results, the commenters argue that a
change in the DRG classification system for FY 1996 is imperative,
using the following criteria to classify patients into a separate DRG:
A diagnosis of intractable epilepsy (diagnosis codes 345.0
through 345.9, with a 5th digit of 1); and
Procedure code 89.19 for video and radio-telemetered
monitoring.
In addition, one commenter noted that the relatively low volume of
cases of intractable epilepsy with telemetered monitoring (fewer than
500) is not a valid objection to establishing a separate DRG for these
cases because there are currently over 70 DRGs with 500 or fewer cases.
Response: The epilepsy treatment community has for some time
expressed concern that the resources used to treat intractable epilepsy
patients far exceeded those needed for other patients in the same DRGs,
and that Medicare payment is inadequate to meet these costs. We have
addressed the issue of Medicare payment for intractable epilepsy cases
for the past 4 years. As a result of our previous analyses, we
concluded that although intractable epilepsy patients incur higher
average charges than other patients in the same DRGs, there is neither
sufficient differential in the charges nor sufficient volume to warrant
a DRG change.
We updated our most recent study and evaluated the March 1995
update of the FY 1994 MedPAR file. We identified 2,385 intractable
epilepsy cases with an average charge of $9,084, compared to an average
charge of $7,636 for all patients in the same DRGs (that is, DRGs 24,
25, and, 26).
We note that, although the incidence of inpatient admissions for
all cases of epilepsy decreased nearly 30 percent in FY 1993, in FY
1994 intractable epilepsy inpatient admissions increased by a little
over 4 percent, with nonintractable epilepsy admissions continuing to
decrease (down 21 percent). The largest increase in admissions occurred
in DRG 25, up more than 16 percent. Nonintractable epilepsy cases
incurred an average charge of $7,458, for 10,536 cases.
The following table summarizes our most recent epilepsy analysis
findings, comparing the average charges between epilepsy and other
cases assigned to the same DRG (the number of cases is included in
parentheses):
----------------------------------------------------------------------------------------------------------------
Intractable Nonintractable
DRG epilepsy epilepsy All epilepsy All cases
----------------------------------------------------------------------------------------------------------------
24.................................. $11,083 $8,626 $8,937 $8,649
(1,065) (7,342) (8,407) (58,726)
25.................................. 7,471 4,762 5,555 4,946
(1,320) (3,190) (4,510) (22,121)
26.................................. 0 $13,060 $13,060 7,834
(0) (4) (4) (43)
All cases........................... 9,084 7,458 7,758 7,636
(2,385) (10,536) (12,921) (80,890)
----------------------------------------------------------------------------------------------------------------
Based on the recommendation of the commenters, we focused our
analysis on DRG 25, with and without video-telemetered monitoring
(procedure code 89.19). Our results parallel the expectations of the
commenters. That is, patients with intractable epilepsy who receive
monitoring incur charges significantly higher than both intractable
cases without monitoring and nonintractable cases with monitoring.
Also, this differential is greatest in DRG 25, with an average charge
of $11,088 for intractable patients with monitoring compared to $5,397
for intractable patients not receiving monitoring. We note that the
number of intractable epilepsy inpatient admissions has increased over
last year; the number of cases with monitoring has increased almost 34
percent in DRG 25. Thus, it would appear that access to care is not
being jeopardized, particularly in this area over which
[[Page 45788]]
commenters expressed the greatest concern. It is notable, also, that
the charges for treating intractable epilepsy patients with monitoring
increased 9 percent, while the cost of treating these patients without
monitoring decreased 2 percent. The results of our analysis of DRG 25
are summarized in the following table:
------------------------------------------------------------------------
Intractable Nonintractable
DRG epilepsy epilepsy
------------------------------------------------------------------------
24 with 89.19.............................. $14,299 $9,826
(107) (35)
24 without 89.19........................... 10,724 8,620
(958) (7,307)
25 with 89.19.............................. 11,088 7,454
(481) (88)
25 without 89.19........................... 5,397 4,685
(839) (3,102)
26 with 89.19.............................. 0 0
(0) (0)
26 without 89.19........................... 0 13,060
(0) (4)
------------------------------------------------------------------------
As we did last year, we evaluated the experience of intractable
epilepsy patients under age 65 in DRG 25. These patients qualify for
Medicare benefits on the basis of disability rather than age. We
focused our analysis on DRG 25 because patients admitted for
neurodiagnostic monitoring must be relatively healthy and, thus, do not
usually have any complicating conditions. Again, we found that those
patients under 65 years of age with intractable epilepsy and
telemetered monitoring (454 cases) incurred higher average charges
($11,330) than similar patients (27 cases) over 65 ($7,030).
The results of our analysis of DRG 25 by age category are as
follows:
------------------------------------------------------------------------
DRG 25 Age <65 Age 65 All ages
------------------------------------------------------------------------
All Epilepsy... $6,002 $4,911 $5,555
(2,659) (1,851) (4,510)
All Intractable 7,757 5,383 7,470
(1,161) (159) (1,320)
Intractable
with 89.19.... 11,330 7,030 11,088
(454) (27) (481)
Intractable
without 89.19. 5,464 5,046 5,397
(707) (132) (839)
All
Nonintractable 4,643 4,867 4,762
(1,498) (1,692) (3,190)
Nonintractable
with 89.19.... 7,679 5,699 7,454
(78) (10) (88)
Nonintractable
without 89.19. 4,476 4,862 4,685
(1,420) (1,682) (3,102)
------------------------------------------------------------------------
We also reviewed the intractable cases where sphenoidal electrodes
were inserted and identified 62 cases, with an average charge of
$12,220. It is interesting to note that while there was more than a 14
percent increase in the incidence of these cases, the average charge
actually decreased. These patients continue to incur higher charges
than those with video-telemetered monitoring.
We note that, as a group, the intractable epilepsy cases are not
the most resource intensive set of cases assigned to DRGs 24, 25, and
26. The highest volume of epilepsy cases are coded 345.3 (Epilepsy,
Grand Mal status), with 5,608 cases and an average charge of $12,054.
Of the epilepsy diagnoses, the average charge for grand mal epilepsy is
exceeded only by intractable epilepsy partialis continua (diagnosis
code 345.71) with an average charge of $13,095, but only 94 cases.
In response to the commenters' contention that epilepsy centers are
at financial risk, we also evaluated the distribution of epilepsy cases
across hospitals. There were 740 hospitals treating intractable
epilepsy patients: approximately 55 percent treated only one patient;
an additional 20 percent treated 2 patients; and 7 percent treated 3
patients. Of the providers treating 10 or more cases of intractable
epilepsy (7 percent or 52 hospitals), 34 treated more than 20
intractable cases (approximately 5 percent of the total providers).
Recognized epilepsy specialty centers accounted for about 3 percent of
total intractable admissions (24 epilepsy center providers). As in our
prior analyses, we found that among the high volume hospitals, charges
for these cases were normally distributed, with only 21 percent
incurring charges greater than the average charge for intractable
epilepsy cases with telemetered monitoring, and 33 percent above the
average for all epilepsy cases. Accounting for those cases that fall
within the average range, 69 percent of the providers incurred average
charges below the overall average for intractable cases with
monitoring, and 61 percent incurred charges below the average for all
epilepsy cases.
Of the 30 recognized epilepsy treatment centers, only 24 reported
any intractable epilepsy discharges in FY 1994. Approximately 71
percent (17 of 24 centers) treated 10 or more cases. However, of the
total 2,385 intractable epilepsy cases, only 20 percent (477 cases)
were treated at epilepsy centers. There were 16 centers (67 percent)
with average charges at or below the average charge of $9,084 for all
intractable epilepsy cases; only 8 centers incurred average charges
above the intractable average charge for treating intractable epilepsy
cases.
As we have stated in previous final rules, we acknowledge that,
even though the volume of hospitals is small, many hospitals treating
high numbers of intractable epilepsy patients may incur charges above
the average. This is particularly true for the specialized treatment
centers. However, we note that these hospitals are, for the most part,
large urban or teaching hospitals or both and, as such, receive some of
the highest Medicare payment rates.
We are not recommending any DRG modification for epilepsy cases at
this time. Although the intractable epilepsy cases, especially those
using procedure 89.19, result in higher charges than other cases in the
same DRGs, neither the volume nor the differential in average charges
is sufficient to justify a separate DRG for these patients.
Concerning the comment that there are over 70 DRGs with fewer than
500 cases, we note that the vast majority of these lower volume DRGs
(59 out of 89 for FY 1994) are for patients age 0 to 17 years, or are
located in MDC 14 (Pregnancy, Childbirth, and Puerperium) or MDC 15
(Newborns and Other Neonates with Conditions Originating in the
Perinatal Period). None of these is reflective of the Medicare
population, who are primarily
[[Page 45789]]
age 65 or older. Many of the remaining lower volume DRGs are for cases
that are generally no longer performed in the hospital inpatient
setting. That is, they are assigned to surgical procedures that have
moved from being generally performed in the inpatient setting to being
performed in an outpatient setting. A few remaining DRGs were
established during the initial classification of cases and were
determined to have no other clinically appropriate DRG assignment (for
example, DRG 43 (Hyphema)). This is not true for epilepsy cases, which
are clinically similar to other cases in the DRGs to which they are
currently assigned.
Comment: One commenter expressed concern that, in order to ensure
access to care, DRG revisions must occur to account for the higher
charges incurred by intractable epilepsy patients receiving
neurodiagnostic monitoring.
Response: We believe that the increase in the number of intractable
epilepsy cases overall (up 4 percent) and the 27 percent increase in
intractable epilepsy admissions for video-telemetered monitoring are
evidence that access to care is adequate for these patients. Also, a
hospital may not refuse to provide a covered service to a Medicare
beneficiary if it provides that service to other patients.
Specifically, the Medicare regulations at 42 CFR 489.53(a)(2) provide
that HCFA may terminate a hospital's Medicare provider agreement if it
finds that the hospital places restrictions on the persons it accepts
for treatment and fails to apply them to Medicare beneficiaries the
same as to all other persons seeking care.
Comment: One commenter noted that many other payers utilize
Medicare's DRG classification system, causing an even greater financial
loss attributable to treating intractable epilepsy patients because of
an arguably inadequate DRG payment.
Response: We have regularly cautioned against the use of the DRG
classification system for populations other than the one for which it
was designed. Medicare serves a predominantly elderly population, and,
thus, the assignment of cases reflects the unique needs and conditions
of this age group. To attempt to classify other populations within this
structure may result in inappropriate designation of cases. We do not
believe that we should develop a system that reflects the experience of
another patient group and expect to apply such categorizations to the
elderly population. Nor can we assume responsibility for other payers
who may attempt to use the Medicare classification system for
populations for which it was not intended.
b. Cochlear Implants (DRG 49). Comment: We received one comment
regarding cochlear implants. The commenter expressed concern that the
proposed weight for DRG 49 (Major Head and Neck Procedures) is
insufficient to compensate hospitals for the cost of providing the
cochlear implant to Medicare patients. The commenter is concerned that
this will exacerbate a growing access problem for those who need the
device. The commenter stated that several hospitals each year have
determined that the loss suffered in providing the cochlear implant to
the Medicare population makes an ongoing cochlear implant program
unsustainable. The commenter quotes utilization figures for the past 4
years, indicating a steady decline in Medicare patient volume.
Because the cochlear implant is a technology-intensive rather than
a labor-intensive procedure, the commenter believes that the current
system, designed to encourage hospitals to control their costs,
suppresses the diffusion of the cochlear implant among the Medicare
population. In the absence of a payment policy that the commenter
believes will adequately reimburse technology intensive procedures,
they requested the following:
Cochlear implant procedures be placed in DRG 1 (Craniotomy
Age >17 except for Trauma).
HCFA allow separate payment of the speech processor which
is not provided during the hospital stay.
A separate, temporary DRG be created, with a weight of at
least 3.0, until such time that a more acceptable policy for
technology-intensive DRG's is implemented.
Response: Cochlear implants were first covered by Medicare in 1986
and were assigned to DRG 49 (Major Head & Neck Procedures), the highest
weighted surgical DRG in MDC 3 (Diseases and Disorders of the Ear,
Nose, Mouth and Throat). Since that time, the cochlear industry has
contended that the weight of DRG 49 is too low and does not adequately
reflect the resources necessary for the cochlear implant procedure. In
response to these concerns, we have analyzed Medicare data every year
since 1986.
Our latest analysis, using FY 1994 Medicare claims data, identified
a total of 76 cochlear implant cases. Of these cases, 67 were assigned
to DRG 49 (9 cases were assigned to DRG 468, Extensive OR Procedure
Unrelated to Principal Diagnosis), representing 3.3 percent of all
cases in DRG 49. These 67 cases incurred an average charge of $21,793,
compared to an average charge of $15,938 for all cases in DRG 49. The
average charge for cochlear implant cases is down slightly from FY 1993
claims ($22,386) while the average charge for all cases in DRG 49 shows
a small increase (up from $15,679). This increase is most likely a
function of the reclassification, effective October 1, 1993, of the low
charge procedure, partial glossectomy, from DRG 49 to DRGs 168 and 169
(Mouth Procedures).
Although there is a higher charge for the 67 cochlear cases than
for many of the other cases in DRG 49, we note that the cochlear cases
are distributed across 44 hospitals, with no more than 6 cases at any
one hospital. The majority of hospitals (30 of 44 hospitals, or 68
percent) have only one case.
We have repeatedly addressed the recommendation that we assign
cochlear implants to DRG 1, most recently in the September 1994
prospective payment final rule (59 FR 45342). Our rejection of this
suggestion continues to be based on our conclusion that the diagnosis
code associated with cochlear cases (diagnosis code 389, hearing loss)
is not clinically coherent with the diagnosis codes assigned to MDC 1.
A basic premise of DRG classification is the assignment of clinically
similar discharges within categories based on a common body system or
organ system. To reassign cochlear implant cases to MDC 1, we would
have to move the principal diagnosis code 389 from MDC 3, the
clinically appropriate MDC.
The commenter requested that HCFA allow separate payment of the
speech processor, which is typically provided to the patient 4 to 6
weeks after the surgery, thus ``unbundling'' these costs from other
inpatient supplies and services to be billed by the surgeon or
audiologist to Medicare Part B. Prior to implementation of the
prospective payment system, it was a practice for certain nonphysician
services and supplies furnished to hospital inpatients to be billed
directly to patients under Medicare Part B. However, with the enactment
of Public Law 98-21 and the implementation of the prospective payment
system, several statutory changes concerning the bundling policy were
made. Specifically, section 1862(a)(14) of the Act provides that, to
qualify for Medicare payment, all nonphysician services (with limited
exceptions) furnished to hospital inpatients must be provided directly
or arranged for by the hospital. Thus, these services become inpatient
hospital services payable under Medicare Part A. Section 1833(d) of the
Act, in turn, provides that services payable under
[[Page 45790]]
Part A may not be paid for under Part B. Therefore, all the services
provided to a Medicare beneficiary as part of the inpatient hospital
stay are covered under Part A and may not be billed under Part B. This
includes the external components of the cochlear device that are
implanted during an inpatient stay covered under Part A. Therefore, we
do not allow separate Part B payment for part of the cochlear device.
In response to the recommendation submitted by the commenter to
assign cochlear implant cases to a new DRG with a weight of at least
3.0, we believe the process for assigning cases as well as calculating
DRG relative weights needs to be clarified. HCFA does not assign
weights to DRGs arbitrarily, but, rather, calculates the weight for
each DRG based on the resources necessary to treat patients assigned to
that DRG relative to all other DRGs. A DRG weight cannot be adjusted or
a new DRG created without affecting the weight of other DRGs. It would
be inappropriate and inadvisable for us to create a new DRG with a
specified weight assigned, as such action would impact the weight and,
therefore, the payment, for other DRGs. The process by which DRG
weights are recalibrated is described in detail below in section II.C
of this preamble.
We acknowledge that the Medicare payment for cochlear implant
patients has been an issue for several years. However, we find no
justification for creating a special DRG for cochlear implants. We have
consistently classified clinically similar patients in DRGs who use
approximately the same amount of hospital resources. In addition, we
prefer to maintain DRGs with enough cases to ensure a normal
distribution and relative stability over time.
Although some technologies may not be flexible in their costs, and
thus, not lend themselves readily to cost control techniques, there are
other areas within the hospital's control that are responsive to cost
containment. Thus, the incentive to the hospital is to treat a mix of
patients and to manage its operations in such a way to offset lower
payment-to-cost cases with those where the payment is in excess of
cost.
We continue to believe that the low volume of these cases does not
justify the establishment of a new DRG specific to cochlear implants.
Nor do we generally create DRGs that are specific to a single
technology, especially those available through a single source
manufacturer.
In response to the commenter's concern that cochlear implants may
not be available to Medicare beneficiaries in the future, as stated
above in section II.B.10.a of this preamble, we note that a hospital
may not refuse to provide a covered service to a Medicare beneficiary
if it provides that service to other patients. Specifically, the
Medicare regulations at Sec. 489.53(a)(2) provide that HCFA may
terminate a hospital's Medicare provider agreement if it finds that the
hospital places restrictions on the number of Medicare beneficiaries it
will accept for a particular treatment without placing the same
restriction on the other populations it treats.
c. Bipolar Hip Replacement (DRG 209). We received a comment
concerning the DRG assignment of certain cases in MDC 8 (Diseases and
Disorders of the Musculoskeletal System and Connective Tissue).
Comment: The commenter believes that cases of bipolar hip
replacement should be assigned to DRGs 210, 211, and 212 (Hip and Femur
Procedures Except Major Joint) rather than to its current assignment,
DRG 209 (Major Joint and Limb Reattachment Procedures of Lower
Extremity). The commenter stated that procedure code 81.52 (partial hip
replacement) is very similar to procedure code 79.35 (open reduction of
fracture of the femur with internal fixation), which is already
assigned to DRGs 210, 211, and 212. Further, the commenter believes
that partial hip replacement patients are generally more frail
individuals as compared to the population that elects total hip
replacement surgery, and that they should, therefore, not be assigned
to the same DRG.
Response: In recent years, we have conducted several analyses of
the procedures assigned to the surgical DRGs in MDC 8. In the final
rules dated September 4, 1990 (56 FR 43205) and September 1, 1993 (58
FR 46286), we addressed two of those analyses in detail. Although the
specific issues that concern the commenter were not addressed, the
result of our analyses was to retain the current DRGs 209, and 210,
211, and 212 classifications. We will, however, reexamine these
assignments as part of our annual update and revision process for FY
1997.
d. Add-On Payment for Blood Clotting for Hemophiliacs. We received
one comment regarding payment for blood clotting factors administered
to hemophilia inpatients.
Comment: The commenter questioned why there was no reference in the
proposed rules to the continuation of the add-on payment for blood
clotting factors administered to Medicare hemophilia patients. The
commenter believes that if this additional payment program is not
continued, then some other mechanism should be developed to help
alleviate the financial burden of treating these patients.
Response: We did not include a discussion of the payment for blood
clotting factors provided to hemophilia inpatients in the proposed rule
because the legislation that required this add-on payment expired
effective with discharges beginning on or after October 1, 1994.
Section 6011 of the Omnibus Budget Reconciliation Act of 1989
(Public Law 101-239), as amended by section 13505 of the Omnibus Budget
Reconciliation Act of 1993 (Public Law 103-66), provided that
prospective payment hospitals receive an additional payment for blood
clotting factors furnished to Medicare hospital inpatients who are
hemophiliacs for discharges occurring on or after June 19, 1990, and
before October 1, 1994.
We discussed the issue of payment for Medicare inpatients with
hemophilia who require blood clotting factors in detail in the
September 1, 1992 final rule in response to a ProPAC recommendation
that the add-on payment was no longer necessary. Briefly, ProPAC found
that, even though hemophiliacs were more costly to treat than the
average case within a given DRG, there were insufficient data to
indicate that these differences were due to the administration of the
clotting factor. In addition, ProPAC found that not only was there a
low volume of patients receiving the blood clotting factor, there were
very few hospitals with a significant number of cases. Analyses
performed by HCFA resulted in similar findings. Thus, we agreed with
ProPAC's conclusion that this add-on payment for blood clotting factors
is not necessary.
e. Stem Cell Transplant. Comment: We received one comment
requesting that we classify procedure code 41.04 (autologous
hematopoietic stem cell transplant) as an OR procedure. The code was
effective beginning October 1, 1994, and was classified as a non-OR
procedure at that time. The commenter believes that we should
reconsider this policy based on the resource use associated with stem
cell transplant. In addition, the commenter requested that the code be
assigned to DRG 481 (Bone Marrow Transplant) along with the other codes
in category 41.0 (bone marrow transplant).
Response: As discussed in the September 1, 1994, final rule in
response to a similar comment, prior to the creation of procedure code
41.04 for stem cell transplants, this procedure
[[Page 45791]]
was included in procedure code 99.73 (therapeutic erythrocytapheresis),
a non-OR procedure (59 FR 45340). As we have noted several times, our
practice is to assign a new code to the same category as its
predecessor code. Because we could not separately identify the stem
cell transplant cases from the other cases coded with 99.73 in order to
reclassify them and their charges to another DRG, we were unable to
predict the resources required for this code and unable to calculate
the new weights of both the DRG in which this code was classified and
the DRG to which it would be assigned. Therefore, we were prevented
from redesignating code 41.04 as an OR procedure and assigning it to
another DRG.
Although it was requested that this code be reassigned to DRG 481,
we note that the procedure represented by this code is not a bone
marrow transplant procedure. While it may consume hospital resources
similar to those transplant procedures, we will be unable to verify
that assumption until we can evaluate the newly coded stem cell
transplant cases in the FY 1995 MedPAR file. That file will be
available in calendar year 1996 and we will analyze the cases with
procedure code 41.04 as a part of our DRG agenda for FY 1997.
C. Recalibration of DRG Weights
We proposed to use the same basic methodology for the FY 1996
recalibration as we did for FY 1995. (See the September 1, 1994, final
rule (59 FR 45347).) That is, we proposed to recalibrate the weights
based on charge data for Medicare discharges. However, we proposed to
use the most current charge information available, the FY 1994 MedPAR
file, rather than the FY 1993 MedPAR file. The MedPAR file includes
fully-coded diagnostic and surgical procedure data for all Medicare
inpatient hospital bills.
The proposed recalibrated DRG relative weights were constructed
from FY 1994 MedPAR data, based on bills received by HCFA through
December 1994, from all hospitals subject to the prospective payment
system and short-term acute care hospitals in waiver States. The FY
1994 MedPAR file at that time included data for approximately 10.9
million Medicare discharges. The MedPAR file updated through June 1995
includes data from approximately 11 million discharges and is the file
used to calculate the weights set forth in Table 5 of the addendum to
this final rule.
Although we are using the same basic methodology for recalibration,
we are making two revisions which are described below. The methodology
used to calculate the DRG relative weights from the FY 1994 MEDPAR file
is as follows:
To the extent possible, all the claims were regrouped
using the DRG classifications discussed above in section II.B of this
preamble. As noted in section II.B.4, due to the unavailability of
final GROUPER software, we must simulate some classification changes to
approximate the placement of cases under the revised reclassification.
However, there are some changes that cannot be modeled.
Charges were standardized to remove the effects of
differences in area wage levels, indirect medical education costs,
disproportionate share payments, and, for hospitals in Alaska and
Hawaii, the applicable cost-of-living adjustment.
The average standardized charge per DRG was calculated by
summing the standardized charges for all cases in the DRG and dividing
that amount by the number of cases classified in the DRG.
We then eliminated statistical outliers. In computing the
FY 1995 weights, we eliminated all cases outside of 3.0 standard
deviations from the mean of the log distribution of charges per case
for each DRG. For the FY 1996 relative weights, we proposed to
eliminate a case only if it met the current criterion and also was
outside of 3.0 standard deviations from the mean log of distribution of
charges per day. We believe that this refinement to the methodology
reduces the risk of eliminating cases with unusually low or high total
charges that are nevertheless accurately reported. For example, a case
with extremely high charges and a corresponding extremely long length
of stay would be less likely to be eliminated under the revised
methodology.
We received no comment on this refinement and we have identified
the statistical outliers in the final recalibration using this
methodology.
The average charge for each DRG was then recomputed
(excluding the statistical outliers) and divided by the national
average standardized charge per case to determine the relative weight.
The second revision we proposed to make is in the treatment of transfer
cases. In past recalibrations, we have counted transfer cases as full
cases. This may distort the average standardized charges, particularly
in DRGs with a high percentage of transfer cases, because the charges
associated with a transfer case often do not reflect the resources
necessary for a complete course of treatment. Therefore, in calculating
the proposed FY 1996 relative weights, a transfer case was counted as a
fraction of a case based on the ratio of its length of stay to the
geometric mean length of stay of the cases assigned to the DRG. That
is, a 5-day length of stay transfer case assigned to a DRG with a
geometric mean length of stay of 10 days was counted as 0.5 of a total
case.
We received one comment concerning this methodology, which
supported our change. Therefore, we have included it in the final
recalibration.
We established the relative weight for heart and liver
transplants (DRGs 103 and 480) in a manner consistent with the
methodology for all other DRGs except that the transplant cases that
were used to establish the weights were limited to those Medicare-
approved heart and liver transplant centers that have cases in the FY
1994 MedPAR file. (Medicare coverage for heart and liver transplants is
limited to those facilities that have received approval from HCFA as
transplant centers.) Similarly, we limited the lung transplant cases we
used to establish the weight for DRG 495 (Lung Transplant) to those
hospitals that are established lung transplant centers. (As discussed
in detail in the final notice with comment period of Medicare coverage
of lung transplants published in the Federal Register on February 2,
1995 (60 FR 6543), payment for lung transplants is limited to Medicare-
approved facilities, effective July 31, 1995.)
Acquisition costs for kidney, heart, liver, and lung
transplants continue to be paid on a reasonable cost basis. Unlike
other excluded costs, the acquisition costs are concentrated in
specific DRGs (DRG 302 (Kidney Transplant); DRG 103 (Heart Transplant);
DRG 480 (Liver Transplant); and DRG 495 (Lung Transplant)). Because
these costs are paid separately from the prospective payment rate, it
is necessary to make an adjustment to prevent the relative weights for
these DRGs from including the effect of the acquisition costs.
Therefore, we subtracted the acquisition charges from the total charges
on each transplant bill that showed acquisition charges before
computing the average charge for the DRG and before eliminating
statistical outliers.
When we recalibrated the DRG weights for previous years, we set a
threshold of 10 cases as the minimum number of cases required to
compute a reasonable weight. We proposed to use that same case
threshold in recalibrating the DRG weights for FY 1996. Using the final
FY 1994 MedPAR data set, there are 34 DRGs that contain fewer than 10
cases. As discussed in detail in section II.B.3 of this preamble, we
computed the
[[Page 45792]]
weight for the 34 low-volume DRGs using the non-Medicare cases from 19
States.
The weights developed according to the methodology described above,
using the DRG classification changes, result in an average case weight
that is different from the average case weight before recalibration.
Therefore, the new weights are normalized by an adjustment factor, so
that the average case weight after recalibration is equal to the
average case weight before recalibration. This adjustment is intended
to ensure that recalibration by itself neither increases nor decreases
total payments under the prospective payment system.
Section 1886(d)(4)(C)(iii) of the Act requires that, beginning with
FY 1991, reclassification and recalibration changes be made in a manner
that assures that the aggregate payments are neither greater than nor
less than the aggregate payments that would have been made without the
changes. Although normalization is intended to achieve this effect,
equating the average case weight after recalibration to the average
case weight before recalibration does not necessarily achieve budget
neutrality with respect to aggregate payments to hospitals because
payment to hospitals is affected by factors other than average case
weight. Therefore, as we have done in past years and as discussed in
section II.A.4.b of the Addendum to this final rule, we are making a
budget neutrality adjustment to implement that the requirement of
section 1886(d)(4)(C)(iii) of the Act.
III. Changes to the Hospital Wage Index
A. Background
Section 1886(d)(3)(E) of the Act requires that, as part of the
methodology for determining prospective payments to hospitals, the
Secretary must adjust the standardized amounts ``for area differences
in hospital wage levels by a factor (established by the Secretary)
reflecting the relative hospital wage level in the geographic area of
the hospital compared to the national average hospital wage level.'' In
accordance with the broad discretion conferred by this provision, we
currently define hospital labor market areas based on the definitions
of Metropolitan Statistical Areas (MSAs) issued by the Office of
Management and Budget (OMB). In addition, as discussed below, we adjust
the wage index to take into account the geographic reclassification of
hospitals in accordance with sections 1886(d)(8)(B) and 1886(d)(10) of
the Act.
Section 1886(d)(3)(E) of the Act also requires that the wage index
be updated annually beginning October 1, 1993. This section further
provides that the Secretary base the update on a survey of wages and
wage-related costs of short-term, acute care hospitals. The survey
should measure, to the extent feasible, the earnings and paid hours of
employment by occupational category and must exclude data with respect
to the wages and wage-related costs incurred in furnishing skilled
nursing services.
For determining prospective payments to hospitals in FY 1996, the
wage index is based on the data collected from the Medicare cost
reports submitted by short-term, acute care hospitals for cost
reporting periods beginning in FY 1992 (that is, cost reporting periods
beginning on or after October 1, 1991 and before October 1, 1992). The
FY 1996 wage index includes wages and salaries paid by a hospital, home
office salaries, fringe benefits, and certain contract labor costs. The
current computation for the wage index excludes salaries and wages
associated with nonhospital-type services, such as skilled nursing
facility services, home health agency services, or other subprovider
components that are not subject to the prospective payment system.
As discussed in detail below, we proposed to use updated wage data
to construct the wage index as required by section 1886(d)(3)(E) of the
Act. Set forth below is a discussion of that update as well as a
discussion of other wage index issues. In addition, we proposed to
change certain guidelines for hospital reclassification used by the
Medicare Geographic Classification Review Board (MGCRB). That change is
discussed in section III.E of this preamble.
B. FY 1996 Wage Index Update
We proposed to base the FY 1996 wage index, effective for hospital
discharges occurring on or after October 1, 1995 and before October 1,
1996, on the data collected from the Medicare cost report (Worksheet S-
3, Part II) submitted by hospitals for cost reporting periods beginning
in FY 1992.
We proposed to use all of the categories of data collected from
Worksheet S-3, Part II. Therefore, the FY 1996 wage index reflects the
following:
Total short-term, acute care hospital salaries and hours.
Home office costs and hours.
Fringe benefits associated with hospital and home office
salaries.
Direct patient care related contract labor costs and
hours.
The exclusion of salaries and hours for nonhospital
services such as skilled nursing facility services, home health
services, or other subprovider components that are not subject to the
prospective payment system.
Although we did not propose any changes in the reporting of
hospital wage index data, we received some comments on this issue.
Comment: One commenter noted that, in early 1995, HCFA distributed
special audit instructions to the fiscal intermediaries that defined
``direct patient care'' as ``hands on care.'' The commenter believes
that the ``hands on'' definition will create problems because it may be
subject to various interpretations. Also, the commenter objects to a
recent HCFA statement that ``travel time'' in connection with contract
labor is excluded in costs and hours if the information is specifically
identified, but otherwise is included. Again, the commenter believes
there will be inconsistencies when travel time cannot be identified.
Rather than continually refining the definition of direct patient care,
the commenter suggested that we adopt a different approach, such as
``chargeable services'' or ``services provided in revenue producing
cost centers.'' In addition, the commenter recommends that HCFA consult
with industry representatives before any special data requests or audit
instructions are issued that involve large numbers of hospitals.
Response: Before FY 1994, the wage index did not include any costs
associated with contract services because the data collected on
contract services as part of the 1988 wage survey were unreliable. (See
the September 1, 1993 final rule, 58 FR 46295.) However, many hospitals
indicated that they were inappropriately disadvantaged because they
were forced to contract out for nurses and technicians due to shortages
of these services in their areas. To alleviate this problem, we revised
the cost report effective for FY 1990 to collect the data associated
with any direct patient care service contracts such as service
contracts for nurses, therapists, and diagnostic imaging technicians.
We specifically excluded any Part B services, Part A physician
services, management contracts, or any contract for services not
directly involved with patient care.
The contract labor definition is limited to those services directly
related to hands-on patient care. This definition was adopted to
address the main concern expressed by hospitals with respect to the
inclusion of contract labor
[[Page 45793]]
in the wage index, that is, that many hospitals have problems hiring
nurses in areas experiencing nursing shortages and must rely on
contract labor sources. We believe that defining direct patient care as
``chargeable services'' or ``services provided in revenue producing
cost centers'' would result in confusion on the part of hospitals
attempting to exclude nonlabor-related expenses such as payments for
equipment and supplies and nonpatient care contract services such as
management and housekeeping services.
Regarding the exclusion of travel time in connection with contract
labor, we believe that it is appropriate to exclude from the wage data
those nonlabor costs associated with contract services that are billed
separately. Contract labor typically involves negotiating a dollar
amount for labor to be provided. This negotiated amount may include
other costs involved in providing the labor, such as travel costs for
lodging, mileage, and time. However, if these nonlabor costs are billed
separately from the negotiated contract, they are not to be included in
the contract labor wage data.
We believe that our definition of direct patient care is accurate
and clear. Special audit instructions were issued earlier this year
because we were receiving many inquiries regarding contract labor for
services such as pharmacy and clinical laboratory. In the instructions,
which were issued in February 1995, we provided all fiscal
intermediaries with written guidelines concerning our policy to exclude
payments and hours not attributable to direct patient care-related
contract services, which would include pharmacy and clinical laboratory
services.
We believe it is appropriate to issue clarifying instructions to
our fiscal intermediaries on policies without industry input, but we
agree with the commenter that we should consult with industry
representatives before making changes in the types of costs that are
included in the wage index. In fact, virtually all our recent proposals
were made in response to requests from hospital and industry
representatives. In addition, we have conducted special surveys and
task forces to address these issues. One example of our efforts to
involve industry representatives before making a change in policy is
the summer 1993 survey concerning which costs should be recognized as
fringe benefit costs. (See the September 1, 1994 final rule (59 FR
45356).)
Comment: The national representative of a group of fiscal
intermediaries requested that the February 1995 special instruction be
distributed to all fiscal intermediaries.
Response: The February 1995 instruction on direct patient care
related contract services was distributed to all fiscal intermediaries.
Therefore, there should be consistent application of this policy in
future data collection.
Comment: One commenter noted that the wage index for seven out of
eight MSAs in one State decreased between FY 1995 and the proposed FY
1996 values while other areas of the country experienced significant
increases. The commenter suggested that HCFA review in detail those
MSAs that experience significant increases in their wage index values
from the prior year in order to maintain consistency and equity of the
payment system.
Response: HCFA does review the percent change in the updated wage
index from the prior year wage index, by MSA and by urban and rural
hospital location. In addition, we review the wage data for any area
that experiences a wage index change of 10 percent or more to determine
the reason for the fluctuation. When necessary, we contact the
appropriate fiscal intermediary to ensure the validity of the data or
to obtain an explanation for the change. We note that none of the MSAs
referred to by the commenter experienced a change of 10 percent or
more. Therefore, they were not subject to any special review.
We also analyze the impact of the updated wage index on hospitals
using categories such as census division, teaching status, and
geographic reclassification status. This impact analysis is located in
section VI.C of Appendix A to this final rule. We include this impact
analysis in both the proposed and final rules.
1. Verification of Wage Data from the Medicare Cost Report
The data for the FY 1996 wage index were obtained from Worksheet S-
3, Part II, of the HCFA-2552 form submitted and certified for accuracy
by short-term, acute care hospitals for cost reporting periods
beginning during FY 1992 (October 1, 1991 through September 30, 1992).
The wage data are reported electronically to HCFA through the Hospital
Cost Report Information System (HCRIS). As in past years, we initiated
an intensive review of the wage data submitted by hospitals and
performed numerous edits to ensure quality and accuracy. Medicare
intermediaries were instructed to transmit any revisions in wage data
made as a result of their review through HCRIS by early January 1995.
In the proposed rule, we discussed in detail our review of the wage
data as well as the process that hospitals could use to verify their
wage data and to submit corrections if necessary (60 FR 29211).
The wage file used to construct the proposed wage index included
data obtained in late January 1995 from the HCRIS data base and
subsequent changes we received from intermediaries through March 21,
1995. To allow sufficient time to process changes, we instructed
hospitals to submit requests for corrections to their intermediaries by
May 15, 1995. To be reflected in the final wage index, wage data
corrections had to be reviewed, verified, and transmitted to HCFA
through HCRIS on or before June 15, 1995 (except for tabulation or data
entry errors). All data elements that failed edits have been resolved
and are reflected in this final rule.
Comment: One commenter stated that the fiscal intermediaries should
not be given as much discretion to make determinations regarding which
costs should be allowed as wage data for purposes of calculating the
wage index. The commenter believes that HCFA should clearly define
allowable items, and intermediaries should be required to use those
definitions. It is the commenter's opinion that this action would
greatly improve the comparability of wage data from one MSA to another.
Response: We promote consistency in the treatment of allowable wage
costs to the extent possible. We have provided the intermediaries with
the wage data cost report instructions and guidelines for allowable
wage data in the desk review, but it is not possible to define every
allowable wage data item. (See the September 1, 1993 final rule, 58 FR
46299.) We believe that the fiscal intermediaries are generally in the
best position to make determinations regarding the appropriateness of a
particular cost and whether it should be included in the wage index
data. We note that, effective October 1, 1994, hospital cost reports
were revised to further promote equitable and consistent treatment of
wage-related costs (59 FR 45357, September 1, 1994).
Comment: One commenter is concerned that HCFA's edits are not
adequate to ensure consistent treatment of the wage data by the fiscal
intermediaries and to produce wage index values that reflect the true
labor market situation. The commenter is also concerned about delays in
making changes to improve the wage index.
Response: In response to concerns voiced in the past about
inconsistent treatment of wage data, we have taken steps that we
believe should eliminate
[[Page 45794]]
most inconsistencies. Specifically, in November and December of each
year, the fiscal intermediaries perform desk reviews on the wage data
reported by each hospital. These reviews are conducted based on
reasonableness parameters (edits) established by HCFA. HCFA also edits
the wage data using additional edits, such as comparing each hospital's
current year wage data to the prior year wage data, comparing each
hospital's wage data to its MSA's data, and reviewing aggregate data
such as all hospitals with average hourly wages below the second
percentile for all hospitals nationally. The FY 1992 data that were
used to calculate the FY 1996 wage index were subjected to a total of
55 edits. We have also instructed fiscal intermediaries to contact HCFA
when questions arise. In addition, if a hospital disagrees with how a
fiscal intermediary deals with a particular issue, the hospital is
encouraged to bring it to our attention.
Regarding the fluctuations in the wage index by area, as discussed
in a previous response, we analyze the impact of the updated wage index
and review the data for any area that experienced a wage index value
change of 10 percent or more to determine the reason for the
fluctuation. When necessary, we contact the intermediary to determine
the validity of the data or to obtain an explanation for the change.
Regarding changes to improve the wage index, we note that the cost
report form for reporting wage data has been revised effective for FY
1995 (that is, for cost reporting periods that begin on or after
October 1, 1994 and before October 1, 1995). Because this revised cost
report form and instructions are more specific, we expect that the
reporting of wage data and the review of that data will be more
consistent across hospitals and fiscal intermediaries. However, because
of the 4-year time lag between improved data reporting and the use of
those data in the wage index, there is a necessary delay before the
changes can affect the wage index.
2. Requests for Wage Data Corrections
In the proposed rule, we noted that we would make a diskette
available in mid-August that would contain the finalized raw wage data
used to construct the wage index values in this final rule. As with the
diskette made available in March 1995, HCFA made the August diskette
available to hospital associations and the public. The August diskette
is available only for the limited purpose of identifying any potential
errors made by HCFA or the intermediary in the entry of the final wage
data that result from the process described above, not for the
initiation of new wage data correction requests (60 FR 29212).
If, after reviewing the data in the August diskette or in this
final rule, a hospital believes that its wage data are incorrect due to
a fiscal intermediary or HCFA error in the entry or tabulation of the
final wage data, it should send a letter to both its fiscal
intermediary and HCFA. These letters should outline why the hospital
believes an error exists. These requests must be received by the
intermediary and HCFA no later than September 21, 1995 to allow
inclusion in the wage index values effective October 1, 1995. Requests
should be sent to: Office of Hospital Policy; Attention: Nancy Edwards,
Director; Division of Prospective Payment System; Room C5-06-27; 7500
Security Boulevard; Baltimore, Maryland 21244-1850. The intermediary
will review requests upon receipt, and, if it is determined that an
intermediary or HCFA error exists, the fiscal intermediary will notify
HCFA immediately.
As noted in the proposed rule, after mid-August, we will make
changes to the hospital wage data only in those very limited situations
involving an error by the intermediary or HCFA that the hospital could
not have known about before its review of the August diskette.
Specifically, neither the intermediary nor HCFA will accept the
following types of requests in conjunction with this mid-August
process: requests for wage data corrections that were submitted too
late to be included in the data transmitted to the HCRIS system on or
before June 15, 1995; requests for correction of errors made by the
hospital that were not, but could have been, identified during the
hospital's review of the March 1995 data; or requests to revisit
factual determinations or policy interpretations made by the
intermediary or HCFA during the wage data correction process. Verified
corrections to the wage index made as a result of an intermediary or
HCFA error received timely (that is, by September 21, 1995) will be
effective October 1, 1995.
We believe the wage data correction process described above
provides hospitals with sufficient opportunity to bring errors made by
the hospital during the preparation of Worksheet S-3 to the
intermediary's attention. Moreover, because hospitals had access to the
raw wage data in mid-August, they will have had the opportunity to
detect any data entry or tabulation errors made by the intermediary or
HCFA before the implementation of the prospective payment rates on
October 1. We believe that if hospitals avail themselves of these
opportunities, the wage index implemented on October 1 should be free
of such errors. Nevertheless, in the unlikely event that such errors
should occur, we retain the right to make midyear changes to the wage
index under very limited circumstances.
Specifically, in accordance with Sec. 412.63(s)(2), we may make
midyear corrections to the wage index only in those limited
circumstances where a hospital can show: (1) that the intermediary or
HCFA made an error in tabulating its data, and (2) that the hospital
could not have known about the error, or did not have an opportunity to
correct the error, before the beginning of FY 1996 (that is, by the
September 21, 1995 deadline). As indicated earlier, since a hospital
will have the opportunity to verify its data, and the intermediary will
notify the hospital of any changes, we do not foresee any specific
circumstances under which midyear corrections would be made. However,
should a midyear correction be necessary, the wage index change for the
affected area will be made prospectively from the date the correction
is made. We received several comments concerning the collection and
verification of the wage data.
Comment: One commenter is concerned that the definition of ``HCFA
or intermediary error'' related to requests for wage data corrections
has been modified to mean only those errors relating to the entry or
tabulation of the wage data. The commenter also stated that it is not
clear if this would remove inconsistent applications or interpretations
of HCFA policy by the intermediary from the definition of an error. The
commenter disagrees with excluding an inconsistent application of
policy from the definition of errors.
Response: In the proposed rule, we stated that, after mid-August,
we would make changes to the hospital wage data only in those very
limited situations involving an error by the intermediary or HCFA that
the hospital could not have known about before its review of the
diskette we made available in August (60 FR 29212). We specified that
after the May 15 deadline for submission of requests for corrections,
hospitals would not be able to request that we reconsider factual
determinations or policy interpretations made by the intermediary or
HCFA. We believe that hospitals had sufficient opportunities to raise
these types of issues, including review of the March 1995 data. Thus,
after May 15, correctable errors to the wage data are limited to data
entry or tabulation errors made by HCFA or the intermediary.
[[Page 45795]]
Comment: One commenter believes that any wage data and wage index
changes made for one hospital after the final rule is published should
not have a negative impact on other hospitals. While acknowledging
budget neutrality limitations, the commenter stated that, last year,
several MSAs were subject to wage index changes even though only one
MSA had a hospital that made a mistake in reporting certain data.
Response: We do not believe it is appropriate to make a ``partial
correction,'' that is, correcting a hospital's wage data but not
incorporating the effects of the correction into the wage index value
for all hospitals in the MSA. We note that we make both types of
corrections--those that decrease the wage index value of an MSA as well
as those that result in an increase in the wage index value.
Comment: One commenter requested that we specify a date by which
intermediaries must notify hospitals regarding determinations on wage
data correction requests. The commenter believes the rules should be
changed to specify a date prior to the June 15 deadline, in order to
give hospitals the opportunity to appeal the intermediary decision to
HCFA.
Response: In order to allow sufficient time to review and process
the wage data so that the final wage index and prospective payment
rates can be published by September 1, it is necessary that the
intermediary transmit any wage data corrections to HCFA through HCRIS
on or before June 15. The raw hospital wage data become available to
the public in mid-March, and we allow hospitals 2 months to review
their wage data and submit wage data corrections, including all
documentation necessary to support the requested change. We then allow
the intermediary 1 month in which to review, verify and submit revised
data in response to these correction requests. We do not believe that
it would be appropriate to shorten the time available to the
intermediaries for these determinations.
In each of the past two years, a commenter has suggested that we
establish a formal appeals process for disputes over corrections
submitted by hospitals to intermediaries (58 FR 46301 and 59 FR 45351).
We continue to believe that a formal appeals process is neither
necessary nor feasible. We believe that maintaining the current
timeframes gives hospitals more flexibility in their review. We
encourage hospitals to submit their wage data correction requests to
the fiscal intermediary as soon as possible in order to allow the
intermediary sufficient time to review the request prior to June 15.
Comment: One commenter requested changes in the format of the wage
data diskette that we make available to the industry. The commenter
believes that HCFA should provide additional information on the wage
data diskette, such as each hospital's MSA, redesignated MSAs, and
inflation factors. This would allow purchasers of the diskette to group
hospitals by MSA in order to make comparisons and to verify the
published wage index.
Response: The purpose of the diskette that HCFA makes available is
to allow each hospital to review its wage data in order to verify that
it is correct before it is used in the calculation of the final wage
index. We agree with the commenter that the hospital's MSA should be
included in the diskette and we will revise the format accordingly.
However, we are unable to add any other data elements to the diskette
because of space limitations. That is, we would be forced to expand to
two diskettes, requiring the purchase of both diskettes to obtain all
wage data. We are, however, considering the possibility of providing
all of the requested data elements electronically (that is, on-line).
In the meantime, we note that there is a Payment Impact file available
for both the proposed and final rules. This file contains the data used
to estimate payments, and we suggest that members of the public who
wish to make comparisons order this disk. See our June 2, 1995 proposed
rule for ordering information (60 FR 29250).
3. Effect of Judicial Reversal of Wage Data Denial
It has been our longstanding policy to make midyear revisions to
wage index data prospectively only (see, for example, 49 FR 258
(January 3, 1984); 54 FR 36478 (September 1, 1989)), and we continue to
believe that, to the extent that midyear wage data revisions are
appropriate, those revisions should be made prospectively only. Some
hospitals whose requests for wage data revisions have been denied by
HCFA have sought relief in the Federal courts. While no court has yet
reversed an HCFA decision denying a hospital's wage data revision
request, these cases have the potential to present the question of what
effect we would give to such a final judicial decision.
Because we had not previously addressed this question in any
rulemaking, we proposed to clarify our position regarding the temporal
effect of a final judicial decision reversing an HCFA denial of a
hospital's request for a wage data revision. We proposed to add a new
Sec. 412.63(s)(5) to clarify that such a decision has limited
retroactive effect. If a final judicial decision reverses an HCFA
denial of a hospital's wage data revision request, we proposed to treat
the hospital as if HCFA's decision on the hospital's wage data revision
request had been favorable rather than unfavorable. HCFA would pay the
hospital by applying a revised wage index that reflects the revised
wage data at issue. The revised wage data would not be considered for
purposes of revisiting past adjudications of requests for geographic
reclassification under section 1886(d)(10) of the Act. Under the
statutory scheme established by Congress, decisions on applications for
MGCRB reclassification must be finalized prior to the Federal fiscal
year for which the reclassifications would take effect.
In some Federal fiscal years, wage data revision requests were
initially reviewed by the fiscal intermediaries and forwarded to HCFA
for a determination of whether a revision should be made. In other
years, the fiscal intermediaries themselves have made determinations on
wage data revision requests (with input from HCFA when necessary). The
latter is our current policy. In the foregoing discussion, the phrases
``HCFA denial of a hospital's wage data revision request'' and ``HCFA
decision on the hospital's wage data revision request'' mean the
decision by either HCFA's Office of Hospital Policy or the intermediary
denying a hospital's request for a wage data revision.
We considered proposing to apply a strict policy of prospectivity
to final judicial decisions reversing HCFA denials of wage data
revision requests--that is, adopting a policy to apply such judicial
decisions prospectively from the date they are made. While we continue
to believe that prospective-only changes are most appropriate under a
prospective rate-setting system such as the hospital inpatient
prospective payment system, we also recognize that hospitals have
sought, and will continue to seek, judicial review of unfavorable HCFA
decisions on hospitals' requests for wage data revisions. Applying a
policy of strict prospectivity to final judicial decisions reversing
HCFA denials of wage data revision requests might be viewed, in some
cases, as frustrating the purpose of judicial review, since such a
decision might not be made until after the close of the fiscal year or
years at issue. Therefore, on balance, we believe the better policy is
the one we proposed,
[[Page 45796]]
under which we would give effect to a final judicial decision reversing
a HCFA denial of a hospital's wage data revision request by applying a
revised wage index that reflects the revised wage data as if HCFA's
decision had been favorable rather than unfavorable.
No comments were received on this proposal. Therefore, we will
implement the change as proposed effective beginning FY 1996, that is,
October 1, 1995.
4. Computation of the Wage Index
As noted above, we are basing the FY 1996 wage index on wage data
reported on the FY 1992 cost report. The final wage index is based on
data from 5,269 hospitals paid under the prospective payment system and
short-term, acute care hospitals in waiver States. The method used to
compute the FY 1996 wage index is as follows:
Step 1--We gathered data from each of the non-Federal short-term,
acute care hospitals for which data were reported on the Worksheet S-3,
Part II of the Medicare cost report for the hospital's cost reporting
periods beginning on or after October 1, 1991, and before October 1,
1992.
Each hospital was assigned to its appropriate urban or rural area
prior to any reclassifications under section 1886(d)(8) or 1886(d)(10)
of the Act. In addition, we included data from a few hospitals that had
cost reporting periods beginning in September 1991 and had reported a
cost reporting period exceeding 52 weeks. The data were included
because no other data from these hospitals would be available for the
cost reporting period described above, and particular labor market
areas might be affected due to the omission of these hospitals.
However, we generally describe these wage data as FY 1992 data.
Step 2--For each hospital, we subtracted the excluded salaries
(that is, direct salaries attributable to skilled nursing facility
services, home health services, and other subprovider components not
subject to the prospective payment system) from gross hospital salaries
to determine net hospital salaries. To the net hospital salaries, we
added hospital contract labor costs, hospital fringe benefits, and any
home office salaries and fringe benefits reported by the hospital to
determine total salaries plus fringe benefits.
Step 3--For each hospital, we inflated or deflated, as appropriate,
the total salaries plus fringe benefits resulting from Step 2 to a
common period to determine total adjusted salaries. To make the wage
inflation adjustment, we used the percentage change in average hourly
earnings for each 30-day increment from October 15, 1991 through
September 14, 1993, for hospital industry workers from Standard
Industry Classification 806, Bureau of Labor Statistics Employment and
Earnings Bulletin. The annual inflation rates used were 5.6 percent for
FY 1991, 4.8 percent for FY 1992, and 3.6 percent for FY 1993. The
inflation factors used to inflate the hospital's data were based on the
midpoint of the cost reporting period as indicated below.
Midpoint of Cost Reporting Period
------------------------------------------------------------------------
Adjustment
After Before factor
------------------------------------------------------------------------
10/14/91...................................... 11/15/91 1.059411
11/14/91...................................... 12/15/91 1.055280
12/14/91...................................... 01/15/92 1.051165
01/14/92...................................... 02/15/92 1.047066
02/14/92...................................... 03/15/92 1.042983
03/14/92...................................... 04/15/92 1.038916
04/14/92...................................... 05/15/92 1.034865
05/14/92...................................... 06/15/92 1.030830
06/14/92...................................... 07/15/92 1.026810
07/14/92...................................... 08/15/92 1.022806
08/14/92...................................... 09/15/92 1.018818
09/14/92...................................... 10/15/92 1.014845
10/14/92...................................... 11/15/92 1.011859
11/14/92...................................... 12/15/92 1.008881
12/14/92...................................... 01/15/93 1.005912
01/14/93...................................... 02/15/93 1.002952
02/14/93...................................... 03/15/93 1.000000
03/14/93...................................... 04/15/93 0.997057
04/14/93...................................... 05/15/93 0.994123
05/14/93...................................... 06/15/93 0.991197
06/14/93...................................... 07/15/93 0.988280
07/14/93...................................... 08/15/93 0.985372
08/14/93...................................... 09/15/93 0.982472
------------------------------------------------------------------------
For example, the midpoint of a cost reporting period beginning
January 1, 1992 and ending December 31, 1992 is June 30, 1992. An
inflation adjustment factor of 1.026810 would be applied to the wages
of a hospital with such a cost reporting period. In addition, for the
data for any cost reporting period that began in FY 1992 and covers a
period of less than 360 days or greater than 370 days, we annualized
the data to reflect a 1-year cost report. Annualization is accomplished
by dividing the data by the number of days in the cost report and then
multiplying the results by 365.
Step 4--For each hospital, we subtracted the reported excluded
hours from the gross hospital hours to determine net hospital hours. We
increased the net hours by the addition of any reported contract labor
hours and home office hours to determine total hours.
Step 5--As part of our editing process, we deleted data for 37
hospitals for which we lacked sufficient documentation to verify data
that failed edits because the hospitals are no longer participating in
the Medicare program or are in bankruptcy status. We retained the data
for other hospitals that are no longer participating in the Medicare
program because these hospitals contributed to the relative wage levels
in their labor market areas during their FY 1992 cost reporting period.
Step 6--Within each urban or rural labor market area, we added the
total adjusted salaries plus fringe benefits obtained in Step 3 for all
hospitals in that area to determine the total adjusted salaries plus
fringe benefits for the labor market area.
Step 7--We divided the total adjusted salaries plus fringe benefits
obtained in Step 6 by the sum of the total hours (from Step 4) for all
hospitals in each labor market area to determine an average hourly wage
for the area.
Step 8--We added the total adjusted salaries plus fringe benefits
obtained in Step 3 for all hospitals in the nation and then divided the
sum by the national sum of total hours from Step 4 to arrive at a
national average hourly wage. Using the data as described above, the
national average hourly wage is $18.9296.
Step 9--For each urban or rural labor market area, we calculated
the hospital wage index value by dividing the area average hourly wage
obtained in Step 7 by the national average hourly wage computed in Step
8.
Comment: One commenter noted that Flagstaff, Arizona, a new MSA,
was not designated as an MSA for either wage index or hourly wage
purposes in the proposed rule. The commenter requested that we reflect
this change in the final rule.
Response: After publication of the proposed rule on June 2, Office
of Management and Budget (OMB) Bulletin Number 95-04 established two
new MSAs effective June 30, 1995: Flagstaff, Arizona-Utah MSA
(comprising Coconino County, Arizona and Kane County, Utah) and Grand
Junction, Colorado MSA (comprising Mesa County, Colorado). The bulletin
also changed the name of the Hickory-Morganton, North Carolina MSA to
Hickory-Morganton-Lenoir, North Carolina MSA. These new MSAs and the
revised designation are incorporated in the final wage index (see
Tables 4a and 4d).
Comment: One commenter requested that we establish a wage index
floor for each of the labor market areas in Puerto Rico equal to the
level of the wage index at the time Puerto Rico became subject to the
prospective payment system (October 1, 1987). An alternative proposal
made by the commenter was to
[[Page 45797]]
establish a wage index floor based on the current wage index for rural
Mississippi. The commenter also suggested that, after making either of
the two recommended wage index changes, we should adjust the Puerto
Rico standardized amounts to reflect the higher wage index values
leading to a decrease in the labor share percentage of the Puerto Rico
standardized amounts.
Response: At this time, we do not believe it would be appropriate
to set up a floor level for the wage index. The wage index measures
relative hospital wage levels, so that labor market areas that
experience slower wage growth than the national average wage growth (on
a percentage basis) experience wage index decreases while those who
experience faster growth receive wage index increases. Since the wages
in Puerto Rico have increased at a significantly slower level than
national wages, Puerto Rico's wage index values have decreased
accordingly. The average hourly wage for rural Puerto Rico has
increased 51.7 percent (from $5.40 to $8.19) from FY 1984 to FY 1992,
while the national average hourly wage has increased 94.0 percent (from
$9.76 to $18.93). Consequently, the wage index for rural Puerto Rico
has decreased from 0.5536 in FY 1988, which is based on the FY 1984
data, to 0.4326 in FY 1996, which is based on the FY 1992 wage data.
While we are concerned about the fall in the wage index values in
Puerto Rico, the implementation of a wage index floor would create new
problems. For example, we also must consider that the introduction of a
wage index floor would have to be executed in a budget neutral manner.
Thus, any wage index floor would deprive hospitals with wage index
values above the floor level of their appropriate payment level through
lower standardized amounts. We will continue to study this issue in the
hope of finding a solution that is equitable to hospitals in all areas.
Since we do not believe a wage index floor is appropriate, we will not
be making any changes to the labor share percentage for Puerto Rico
standardized amounts.
Comment: One commenter suggested that we eliminate the Puerto Rico
Rural Area classification and classify those hospitals to their nearest
geographic area (that is, one of the urban Puerto Rico areas). The
commenter's suggestion is based on the belief that there is no
socioeconomic difference between the rural hospitals and any other
hospital on the island.
Response: We do not believe it is appropriate to offer special
treatment for any rural area. Unless and until we decide to adopt a new
method for defining labor market areas, we will continue to use rural
areas for hospitals in counties that are not designated as part of
MSAs. We note that the Puerto Rico rural wage index value has increased
since publication of the proposed rule based on corrections we have
received. The final rural area wage index value is 0.4326, an increase
of 11 percent over the proposed value of 0.3888, and only a slight
decrease from the FY 1995 wage index value.
C. Allocation of General Service Salaries and Hours to Areas Excluded
From the Wage Index
In constructing the wage index, we exclude the direct wages and
hours associated with certain subprovider components of the hospital,
such as skilled nursing facilities and home health agencies. The cost
reporting form used to collect the FY 1992 wage data also includes
within the definition of excluded areas any rehabilitation and
psychiatric distinct part units of the hospital that are excluded from
the prospective payment system. Thus, the wage index is constructed by
including only the direct wages and hours associated with those areas
of the hospital subject to the prospective payment systems. However,
the general service hours associated with excluded areas are not
currently excluded from the wage index calculation.
In the May 26, 1993 proposed rule, we discussed our analysis of our
first attempt to allocate overhead salaries and hours to areas of the
hospital that are excluded from the prospective payment system (58 FR
30237). This analysis was prompted by several suggestions from hospital
representatives that, in addition to excluding the direct salaries and
hours for subprovider components of the hospital, HCFA should also
exclude the general service, or overhead, wages and hours that are
associated with these areas. For example, we currently include all of
the wage costs associated with housekeeping in the wage index data,
even if a facility has excluded subprovider components that receive
housekeeping services. As we discussed in detail in the May 26, 1993
proposed rule, we identified several problems with the data collected
that led us to the conclusion that it would be inappropriate to use the
data in allocating the overhead wages and hours. Thus, we did not
allocate general service salaries and hours to the excluded areas of
hospitals in calculating the FY 1994 wage index.
In the September 1, 1993 final rule, we indicated that we would
revisit this issue when the data for cost reporting periods beginning
in FY 1992 became available (58 FR 46298). We believed that the
retroactive determination of overhead hours for the FY 1990 cost
reports may have caused some of the problems with the data. We stated
that the FY 1992 cost report might allow a more accurate allocation
since both overhead salaries and overhead hours would be directly
reported on the cost report.
In calculating the FY 1996 wage index, we used data for cost
reporting periods beginning in FY 1992. We received general service
hour data for 4,356 of the 4,441 hospitals that reported excluded
salaries. We analyzed these data to determine whether we could
reasonably allocate the overhead wages and hours to the excluded areas
of the hospital. First, we determined the total general service wages
(including fringe benefits) from Worksheet A of the cost report. We
then developed a ratio of total indirect costs (net of capital costs)
allocated to the excluded areas of the hospital to total noncapital
general service costs (using Worksheet B, Parts I, II, and III from the
cost report). We call this the ``indirect cost ratio.'' We computed the
general service salaries and hours allocated to the excluded areas by
multiplying the indirect cost ratio by the total general service
salaries and by the total general service hours reported by the
hospital on the cost report.
For example, if 10 percent of a hospital's total indirect costs
were allocated to excluded areas, we allocated 10 percent of its
overhead salaries and 10 percent of its overhead hours to the excluded
areas.
In the June 2, 1995 proposed rule (60 FR 29214), we discussed in
detail our analysis of the general service allocation. We found that
after we completed the data edits, 4,199 hospitals still had overhead
allocations. Of these, 71 percent (2,978) had average hourly wages that
were lower after the overhead allocation was made to the excluded
areas. The average difference between the pre- and post-allocation
average hourly wage was -0.14 percent. Eighty-six hospitals had a
percentage change of more than 10 percent in their average hourly wage,
of which 45 were decreases. An additional 158 hospitals had a
percentage change of between 5 and 10 percent, of which 104 were
decreases. Thirty-seven of 49 rural labor market areas would experience
decreases in their wage index value if we performed the allocation,
while 195 of 317 urban areas would experience decreases. The average
wage index value for all hospitals would decrease
[[Page 45798]]
0.08 percentage points if we performed the overhead allocation.
Thus, we again concluded that it would not be appropriate to
perform the allocation of overhead salaries and hours to excluded areas
of the hospital in computing the wage index. The data still have the
same variations that were prevalent when we declined to use this
methodology in the proposed rule for FY 1994: many hospitals were
removed due to the edits, many have large swings in their average
hourly wages, and many more hospitals' average hourly wages would
decrease as a result of the allocation than would increase,
particularly for rural hospitals. As we noted in the September 1, 1993
final rule (58 FR 46297), if these allocations are accurate, it would
mean that for the majority of hospitals with excluded areas, the
average hourly wage for the overhead areas (such as laundry and
housekeeping) is higher than that for patient care areas (such as
nursing). We do not believe that this could be the case for such a
large number of hospitals, and we have therefore concluded that the
reported data regarding overhead hours are inaccurate. As a result, we
decided not to employ the allocation of general service salaries and
hours to excluded areas of the hospital in constructing the FY 1996
wage index.
We note that hospital representatives that support the allocation
of overhead salaries to excluded areas do so because they believe that,
for those hospitals with excluded areas, the current average hourly
wage is artificially weighted downward. (See the September 1, 1994
final rule (59 FR 45359).) They believe that the current methodology,
which removes the higher nursing costs in excluded areas from the
hospital's direct salaries, but leaves in the lower general services
salaries, distorts wages downward. The reported data, however, are not
consistent with this concern.
While we continue to believe that an allocation of overhead
salaries and hours to the excluded subprovider components may be
appropriate, it would not benefit the hospital industry or the Medicare
program to implement an allocation that is not reliable. Clearly, the
overhead hours reported by many hospitals did not accurately reflect
the salaries reported. In addition, we realize that the allocation
method described above may not necessarily be the most accurate method
to make this allocation. We invited public comment concerning
alternative methods that might produce a more accurate and uniform
allocation method and at the same time impose little or no additional
reporting burden on the hospital industry. We noted that, under any
acceptable allocation method, we would require that the method be used
by all hospitals with excluded areas and that the intermediary be able
to verify the accuracy of the reported data.
The cost report effective for FY 1995 (that is, for cost reporting
periods that begin on or after October 1, 1994 and before October 1,
1995) will collect overhead data, both paid hours and the related
salaries, by general service area. These data will be used to construct
the wage index for FY 1999. We proposed to reevaluate an allocation of
overhead salaries and hours to excluded areas of the hospital once the
data from this new cost report are available or possibly earlier if we
receive comments or suggestions from the public or otherwise determine
alternative methods to better allocate overhead salaries.
Comment: Three commenters expressed support for the exclusion of
overhead salaries and hours associated with excluded areas of the
hospital and made suggestions regarding allocation methods. One
commenter stated that HCFA's allocation method had merits in terms of
modeling the impact and collectability of the data and requested that
we continue to apply the same methodology in future studies. Another
commenter suggested that HCFA incorporate in this final rule the
collection of data on overhead dollars and hours separately and the
exclusion of overhead salaries and hours associated with excluded
subprovider components. A third commenter suggested a stepped-down cost
finding basis for the allocation of salaries and hours from general
service areas. This commenter believes that the data necessary to
perform the step-down would be readily available to the intermediary
and recommended that HCFA add cost center hours to Worksheet B-1 of the
HCFA 2552-89 to facilitate data collection.
Response: As discussed above, while we agree with the commenters
that an allocation of overhead salaries and hours to the excluded
subprovider components may be appropriate, we believe that it would not
benefit the hospital industry or the Medicare program to implement at
this time an allocation that is not reliable.
Both the commenters who suggested a change in methodology based
that change on the collection of new data. We do not agree with one
commenter's suggestion to employ an allocation method based on stepped-
down cost finding as it would impose additional reporting burden on the
hospital industry. The approach would require a new or revised cost
reporting form to allocate overhead hours and salaries to all of a
hospital's cost centers. In addition, hospitals would have to adopt
uniform statistics for allocating costs to cost centers to ensure data
comparability. As we noted above, any method we use should impose
little or no additional reporting burden. At this time, we do not
believe the merits of an allocation of general service salaries and
hours to excluded areas warrant the additional reporting burden. We
have implemented new cost reporting instructions concerning overhead
data. We will wait to evaluate those data (which will be available for
the FY 1999 wage index) before imposing any additional data
collections.
D. Revisions to the Wage Index Based on Hospital Redesignation
Under section 1886(d)(8)(B) of the Act, hospitals in certain rural
counties adjacent to one or more Metropolitan Statistical Areas (MSAs)
are considered to be located in one of the adjacent MSAs if certain
standards are met. Under section 1886(d)(10) of the Act, the Medicare
Geographic Classification Review Board (MGCRB) considers applications
by hospitals for geographic reclassification for purposes of payment
under the prospective payment system.
The methodology for determining the wage index values for
redesignated hospitals is applied jointly to the hospitals located in
those rural counties that were deemed urban under section 1886(d)(8)(B)
of the Act and those hospitals that were reclassified as a result of
the MGCRB decisions under section 1886(d)(10) of the Act. Section
1886(d)(8)(C) of the Act provides that the application of the wage
index to redesignated hospitals is dependent on the hypothetical impact
that the wage data from these hospitals would have on the wage index
value for the area to which they have been redesignated. Therefore,
pursuant to section 1886(d)(8)(C) of the Act, the wage index values
were determined by considering the following:
If including the wage data for the redesignated hospitals
reduces the MSA wage index value for the area to which the hospitals
are redesignated by 1 percentage point or less, the MSA wage index
value determined exclusive of the wage data for the redesignated
hospitals applies to the redesignated hospitals.
If including the wage data for the redesignated hospitals
reduces the wage index value for the area to which the hospitals are
redesignated by more than 1 percentage point, the hospitals that are
redesignated are subject to the wage index value of the area that
results from including the wage data of the
[[Page 45799]]
redesignated hospitals (the ``combined'' wage index value). However,
the wage index value for the redesignated hospitals cannot be reduced
below the wage index value for the rural areas of the State in which
the hospitals are located.
Rural areas whose wage index values would be reduced by
excluding the data for hospitals that have been redesignated to another
area continue to have their wage index calculated as if no
redesignation had occurred. Those rural areas whose wage index value
increases as a result of excluding the wage data for the hospitals that
have been redesignated to another area have their wage index calculated
exclusive of the redesignated hospitals.
The wage index value for an urban area is calculated
exclusive of the wage data for hospitals that have been reclassified to
another area. However, geographic reclassification may not reduce the
wage index for an urban area below the Statewide rural average,
provided the wage index prior to reclassification was greater than the
Statewide rural wage index value.
A change in classification of hospitals from one area to
another may not result in the reduction in the wage index for any urban
area whose wage index is below the rural wage index for the State. This
provision also applies to any urban area that encompasses an entire
State.
We note that, except for those rural areas where redesignation
would otherwise reduce the rural wage index value, and for urban areas
whose wage index values are already below the rural wage index and
would otherwise be reduced by redesignations, the wage index value for
each area is computed exclusive of the data for hospitals that have
been redesignated from the area for purposes of their wage index. As a
result, several MSAs listed in Table 4a have no hospitals remaining in
the MSA. This is because all the hospitals originally in these MSAs
have been reclassified to another area by the MGCRB. For those areas,
we have listed the Statewide rural wage index value.
Comment: We received one comment on our policy of assigning the
Statewide rural wage index value to MSAs where all of the hospitals
have been reclassified to another area. The commenter believes that our
policy is unfair to new hospitals that open in such an MSA, because
they would be automatically assigned the Statewide rural wage index
value, which is generally much lower than the pre-reclassified value
for the MSA. The commenter stated that the Statewide rural wage index
value would not reflect the labor costs in the labor market in which
the hospital would be operating. Therefore, the commenter requested
that we revise this policy and assign the MSA's pre-reclassified wage
index value to the empty MSA.
Response: We adopted our current policy in response to comments as
part of the August 30, 1991 final rule (56 FR 43222). Upon
reconsideration, we agree with the commenter that the wage levels a new
hospital must pay may be better reflected by the pre-reclassified wage
index value for the area than the State-wide rural wage index value.
Therefore, effective October 1, 1995, we will assign the pre-
reclassified wage index value for an MSA to any MSA where all of the
hospitals have been reclassified to another area. That value would
apply as long as the MSA remains empty or until the new hospital has
reported wage data that are used to calculate a wage index value
(approximately 4 years). This change has been incorporated into the
final wage index tables.
The final revised wage index values for FY 1996 are shown in Tables
4a, 4b, and 4c of the addendum to this final rule. Hospitals that are
redesignated should use the wage index values shown in Table 4c. For
some areas, more than one wage index value will be shown in Table 4c.
This occurs when hospitals from more than one State are included in the
group of redesignated hospitals, and one State has a higher Statewide
rural wage index value than the wage index value otherwise applicable
to the redesignated hospitals. Tables 4d and 4e list the average hourly
wage for each labor market area based on the FY 1992 wage data. In
addition, Table 3c (Hospital Case-Mix Indexes for Discharges) includes
the average hourly wage for each hospital based on the FY 1992 data.
Hospitals may use the average hourly wage published in this final rule
for purposes of applying to the MGCRB for wage index reclassifications
in FY 1997.
We note that in adjudicating these wage reclassification requests
during FY 1996, the MGCRB will use the average hourly wages for each
hospital and labor market area that are reflected in the final FY 1996
wage index. The FY 1996 wage index values incorporate all hospital
redesignations for FY 1996. At the time the final wage index was
constructed, the MGCRB had completed its review. Any changes to the
wage index that resulted from withdrawals of requests for
reclassification, wage index corrections, appeals, and the
Administrator's review process are incorporated into the wage index
values published in the final rule. For FY 1996, 420 hospitals are
redesignated for purposes of the wage index (including hospitals
redesignated under both sections 1886(d)(8)(B) and 1886(d)(10) of the
Act).
E. Changes to the MGCRB Guidelines
1. Limitations on Hospital Reclassification (Secs. 412.230, 412.232,
and 412.234)
a. Elimination of Individual Hospital Reclassification From Rural
to Other Urban Areas for Purposes of the Standardized Amount. Section
1886(d)(10)(C)(i)(I) of the Act requires the MGCRB to consider
applications of hospitals requesting reclassification for purposes of
the standardized amount. Section 1886(d)(10)(D)(i)(II) of the Act
requires that the MGCRB utilize guidelines published by the Secretary
for determining whether the county in which a particular hospital is
located should be treated as being a part of a particular MSA.
Accordingly, the MGCRB allows reclassifications for purposes of the
standardized amount for individual hospitals that meet the guidelines
under Sec. 412.230, and for groups of rural and urban hospitals that
represent an entire county and that meet the guidelines under
Secs. 412.232 and 412.234 respectively.
As required by section 1886(d)(3)(A)(iii) of the Act, effective for
discharges occurring on or after October 1, 1994, the average
standardized amount for hospitals located in a rural area was made
equal to the average standardized amount for hospitals located in other
urban areas. The standardized amount effective for those areas is now
known as the standardized amount for ``other areas.'' Large urban areas
continue to receive a separate, higher standardized amount. The effect
of this provision is that in FY 1995 or later, hospitals reclassified
from rural to other urban areas for purposes of the standardized amount
receive no increase in their standardized payment amount, since the two
rates are now the same.
However, we continue to receive applications from individual
hospitals seeking to be reclassified from rural to other urban areas
for the standardized amount because of certain payment advantages that
accompany the urban designation. When an individual hospital
reclassifies from a rural to an urban area for purposes of the
standardized amount, we consider the hospital urban for all purposes
except the wage index. For some rural hospitals, the urban designation
enables them to qualify as a disproportionate share hospital (DSH) and
to receive special payment adjustments. For other
[[Page 45800]]
rural hospitals that already qualify for DSH payments, the urban
designation qualifies them for a higher DSH adjustment than they would
receive as a rural hospital.
We proposed to provide under new Sec. 412.230(a)(5)(ii) that a
hospital may not be reclassified for purposes of the standardized
amount if the area to which the hospital seeks reclassification does
not have a higher standardized amount than that currently received by
the hospital. This change would be effective for hospital applications
due October 2, 1995, requesting reclassification for FY 1997. (Since
October 1 is a Sunday, the MGCRB will accept applications through
October 2, 1995.)
We note that, under this change, individual rural hospitals could
continue to receive reclassifications to large urban areas, since the
standardized amount for large urban areas is greater than that of rural
(or other urban) areas. Also, group applications from all hospitals in
a rural county for reclassification to urban areas would not be
affected, since these hospitals are required to meet a different
``metropolitan character'' criterion under Sec. 412.232(b) and would
receive the other area's wage index.
We received 15 comments in response to our proposal to eliminate
standardized amount reclassifications for individual hospitals from a
rural area to an other urban area. All of the commenters were opposed
to our proposed change. Four of the comments we received were from
individual hospitals that stated that they would no longer qualify for
higher DSH payments as a result of the change.
Comment: Several commenters raised questions about whether the
statute gives us the authority to eliminate standardized amount
reclassifications from rural to other urban areas and whether we are
interpreting the MGCRB provisions of the statute correctly. One
commenter stated that the statute contains no language that modifies or
limits the areas to which hospitals may seek reclassification, or
restricts the types of hospitals that may seek changes in the
standardized amount. The commenter believes that, because section
1886(d)(10)(C)(i) of the Act provides that the MGCRB shall consider
applications of hospitals seeking reclassification, rather than stating
that the MGCRB may consider such applications, the MGCRB is obligated
to consider applications from hospitals seeking to be reclassified from
rural areas to other urban areas. The commenter argues that the statute
gives the Secretary the authority only to establish guidelines for
evaluating hospital-specific facts, not to preclude specific classes of
hospitals from being reclassified. Another commenter stated that since
Congress had not specifically provided in legislation that rural to
other urban standardized amount reclassification would no longer be
allowed after the rural and other urban rates were made equal, HCFA
does not have the statutory authority to make this change.
Response: We believe the proposed policy of eliminating individual
hospital reclassifications from rural areas to other urban areas for
purposes of the standardized amount is fully consistent with the
language and purpose of the Medicare statute. Although the statute
states that the MGCRB ``shall'' consider applications for
reclassification, the statute does not require the Board to consider a
reclassification request for any purpose whatsoever. Instead, the
relevant terms of the statute provide that the Board ``shall consider''
applications for reclassification ``for purposes of determining * * *
the hospital's average standardized amount.'' Accordingly, the statute
requires the Board to consider requests for standardized amount
reclassification only if the ``purpose'' of the request is for the
hospital to receive the other area's standardized amount. Since the
standardized amount for rural areas now equals the standardized amount
for other urban areas, there is no reason for a rural hospital to be
reclassified to another urban area ``for purposes of'' the standardized
amount itself.
Under the proposed policy, qualifying rural hospitals (and other
urban hospitals too) may continue to seek standardized amount
reclassification to large urban areas because large urban areas have a
different standardized amount (base payment rate). Thus, consistent
with the statute, the Board ``shall consider'' applications for
standardized amount reclassification from hospitals seeking to receive
the other area's (higher) standardized amount. As explained further
below, we also believe that the proposed change is consistent with the
purpose of the statute, as well as the language of the statute.
Comment: Several commenters argued that the proposed policy is
contrary to the purpose of the geographic reclassification system. Some
commenters believe that our proposal is contrary to congressional
intent that geographic reclassification be available to hospitals to
address competitive inequities. One commenter stated that HCFA had
previously interpreted the purpose of geographic reclassification as
addressing those situations where a hospital is more like the hospitals
in a geographic adjacent area than the hospitals in its own geographic
area, and that the proposed policy of not allowing rural hospitals to
be reclassified to other urban areas contravened the agency's
interpretation of the statute and placed those hospitals at a
competitive disadvantage. Another commenter stated that we were
changing our standard as to the purpose of geographic reclassification
from providing hospitals with a more appropriate geographic
classification to providing only a more appropriate standardized
payment rate.
One commenter suggested that HCFA was interpreting the statute very
narrowly in this instance, but in other cases, such as allowing rural
to rural reclassification, HCFA had been more liberal. Another
commenter acknowledged that the statute addressed only the wage index
and standardized amount as reasons for reclassification, but said that
the intent of the MGCRB provisions was to provide an opportunity for
rural hospitals sharing certain characteristics with urban hospitals to
partially escape the disadvantage of their rural status. Still another
commenter believes Congress intended that, if a rural hospital
satisfied HCFA's criteria for standardized amount reclassification to
an other urban area, the hospital should be considered urban for
purposes of disproportionate share payments as well because the
hospital had proved that it was similar to urban hospitals.
Response: We believe the proposed policy is fully consistent with
the purpose of the statute, as well as the language. The geographic
reclassification process enables hospitals to be reclassified to
another geographic area for purposes of receiving the other area's
standardized amount or wage index, the two major components of a
hospital's prospective payment rate. As indicated in the June 4, 1991
final rule implementing the reclassification process, ``we believe
geographic reclassification should be limited to those hospitals which
are disadvantaged by their current geographic classification because
they compete with the hospitals that are located in the geographic area
to which they seek to be reclassified.'' (56 FR 25469.)
For purposes of determining an appropriate standardized amount, a
hospital is not disadvantaged by its ``current geographic
classification'' if the area to which it seeks reclassification has the
same
[[Page 45801]]
standardized amount. Rural hospitals requesting reclassification to
another urban area would receive the same standardized amount. We
believe it is appropriate to limit reclassifications ``for purposes
of'' the standardized amount to hospitals seeking reclassification to
an area with a higher standardized amount. We note that the statute
confers broad authority on the Secretary to determine the circumstances
under which reclassification is appropriate.
In essence, the commenters are arguing that hospitals should be
allowed to seek reclassification solely for purposes of the DSH
adjustment. However, the statute specifies only two purposes for which
hospitals may seek reclassification--the standardized amount and the
wage index, the two major components that determine a hospital's base
prospective payment rate. We believe that, if it is appropriate not to
reclassify a hospital for purposes of the base payment rate itself, as
contemplated by the statute, it is appropriate not to reclassify the
hospital solely for purposes of the DSH adjustment to the base payment
rate.
In response to the arguments that our proposed policy would place
rural hospitals unable to receive higher DSH payments at a competitive
disadvantage, any hospital unable to satisfy the criteria for
reclassification could claim it was placed at a competitive
disadvantage. For example, rural hospitals slightly beyond the
qualifying mileage requirement of 35 miles do not qualify for
reclassification even if they have costs like those of an urban
hospital. Almost every rural hospital in the country could argue that
it shares some characteristics with urban hospitals. However, a rural
hospital cannot argue now that it is disadvantaged because it is unable
to receive the standardized amount of an adjacent other urban area.
Since all hospitals pay for geographic reclassification through the
budget neutrality process, it is HCFA's responsibility to develop
guidelines to determine when reclassification is appropriate. We
believe it is appropriate not to reclassify individual rural hospitals
to other urban areas for purposes of the standardized amount.
Comment: Some commenters stated that the proposed change was
inconsistent with our previous policy of allowing rural hospitals to
reclassify to other urban areas and considering them urban for all
purposes (except the wage index). Many of the commenters were concerned
about the equity of our proposal since rural hospitals located near
large urban areas could continue to reclassify for the standardized
amount and receive higher DSH payments if they qualified, but rural
hospitals located next to other urban areas could not. Some of the
commenters also stated that since rural hospitals have proved that
their costs are similar to those of other urban hospitals they should
be eligible for any payments and adjustments that those hospitals
receive.
Response: We believe that our proposed policy is consistent with
the previous policy of allowing rural hospitals to reclassify to other
urban areas for purposes of the standardized amount and considering
such hospitals urban for all purposes, including DSH payments. It is
important to consider the circumstances underlying each policy. At the
time the previous policy was implemented, the standardized amount for
rural areas was different from the standardized amount for other urban
areas, so it was appropriate to reclassify qualifying rural hospitals
to other urban areas and to consider them urban for purposes of the
standardized amount. We decided that, once a hospital was reclassified
as urban for purposes of the standardized amount, the hospital would
also be considered to be urban for all purposes (except the wage
index).
As this analysis suggests, there is a two-step inquiry in
determining whether a rural hospital should be considered urban for a
purpose other than the standardized amount. The first, and threshold,
question is whether it is appropriate to reclassify the hospital for
purposes of the standardized amount itself, as contemplated by the
statutory language? Only if this threshold question is answered
affirmatively does one reach the second question: should the hospital
be considered urban for other purposes as well?
Applying this analysis, rural hospitals seeking standardized amount
reclassification to other urban areas would now receive the same
standardized amount. Therefore, as explained earlier, we believe it is
appropriate not to reclassify these rural hospitals as urban ``for
purposes of'' the standardized amount. Since there is now no reason to
consider these hospitals as urban for purposes of the standardized
amount, we do not reach the second question of whether the hospitals
should be considered urban for other purposes as well.
We recognize that there may be some possible inequity between rural
hospitals seeking reclassification to other urban areas and rural
hospitals seeking reclassification to large urban areas. However, the
statute does not mandate that hospitals reclassified as urban for
purposes of the standardized amount also be considered urban for
purposes of DSH. We could have decided initially that rural hospitals
reclassified to large urban areas for purposes of the standardized
amount would not be considered urban for other purposes. But then
arguably there would be some inequity between hospitals located in
urban areas and rural hospitals reclassified as urban for purposes of
the standardized amount.
As explained above, we believe the most appropriate policy is to
first address the threshold question: whether it is appropriate to
reclassify certain rural hospitals for purposes of the standardized
amount. If the answer is yes, then we reach the second question:
whether the hospitals should be considered urban for other purposes. We
believe that all of our policies are consistent with this analysis.
Comment: One commenter suggested that we were continuing to allow
rural hospitals adjacent to large urban areas to seek reclassification
because the large urban standardized amount is much higher than the
other standardized amount and few hospitals would be able to qualify
for such reclassification.
Response: As stated earlier, we believe, consistent with the
statutory language and purpose, that it is appropriate for hospitals to
seek reclassification from rural areas to large urban areas for
purposes of the standardized amount because the other area has a higher
standardized amount.
Comment: Two commenters mentioned the impact that this change would
have on rural referral centers. One commenter stated that many
hospitals had voluntarily relinquished their rural referral center
status in order to qualify for higher DSH payments and that HCFA had
previously acknowledged the benefit of such reclassification to these
hospitals. The commenters also stated that 18 hospitals eligible for
rural referral center status were reclassified to other urban areas in
FY 1995 and would lose $13.8 million if the proposal were implemented.
Response: While we recognize that many hospitals voluntarily
relinquished their rural referral center status in the past to qualify
for DSH as an urban hospital and we are sympathetic to the financial
impact that the loss of higher DSH payments will have on these
hospitals, we believe it is appropriate not to allow these hospitals to
be reclassified for purposes of the standardized amount to another area
with the same standardized amount. Eligible hospitals may seek to have
rural referral center status reinstated. Although these hospitals would
not be considered urban for purposes of DSH
[[Page 45802]]
payments, we note that, under section 1886(d)(5)(F)(iv) of the Act,
rural referral centers receive special treatment for purposes of DSH.
In addition, we have previously recognized the role that sole community
hospitals and rural referral centers play in preserving access to care
for rural Medicare beneficiaries by means of the MGCRB special access
rule, which waives the mileage requirement for such hospitals seeking
reclassification. (See 42 CFR 412.230(a)(3).)
Comment: One commenter claims that our proposed change contravenes
the rationale behind HCFA's requirement that DSH be included in the
standardized amount reclassification test. The commenter asserts that
since HCFA has noted that DSH payments change depending on whether or
not a hospital is urban or rural and should be included in the
standardized amount calculation, hospitals that can qualify to
reclassify based upon including their DSH payments and costs should be
allowed to do so.
Response: Again, there is a two-step analysis: first, is it
appropriate to reclassify rural hospitals to other urban areas (or
large urban areas) for purposes of the standardized amount; second, if
the answer to that threshold question is yes, then should the hospitals
be considered urban for purposes other than the standardized amount? As
indicated above, we believe it is appropriate not to reclassify a rural
hospital to an other urban area for purposes of the standardized amount
because the hospital would receive the same standardized amount. In
contrast, it is appropriate to reclassify rural hospitals to large
urban areas for purposes of the standardized amount, and when a rural
hospital qualifies to be considered urban for purposes of the
standardized amount, we believe it is appropriate to consider the
hospital urban for purposes of DSH. Applying this policy in determining
the geographic area (rural or large urban) to which a hospital should
be classified for purposes of the standardized amount, we believe that
applicable DSH payments and costs should be included in the qualifying
cost test because they reflect the costs and payments of the hospital
under the alternative scenarios.
After considering the comments, we have decided to adopt the change
as proposed.
b. Reclassification for Purposes of the Wage Index. Section
1886(d)(10)(C)(i)(II) of the Act requires the MGCRB to consider the
application of any prospective payment hospital for purposes of
changing its applicable wage index. Sections 412.230, 412.232, and
412.234 set forth the types of individual and group reclassifications
that are currently allowed. An individual rural hospital may reclassify
to another rural area or to an urban area. An individual urban hospital
may reclassify to another urban area for purposes of the wage index,
the standardized amount or both. A rural group may reclassify to an
urban area and an urban group may reclassify to another urban area, but
only for purposes of both the wage index and the standardized amount.
In the proposed rule we stated that we do not believe it is appropriate
for hospitals to seek reclassification to an area with a lower wage
index in an effort to use the MGCRB system inequitably (60 FR 29217).
Therefore, under the proposed rule, a hospital that seeks to
reclassify for the purpose of the wage index may apply for
reclassification only to an area that has a higher pre-reclassified
average hourly wage than the pre-reclassified average hourly wage in
the hospital's original geographic area. We proposed revisions to
Secs. 412.230, 412.232, and 412.234 to reflect these changes.
For group reclassifications, we proposed that either the pre-
reclassified average hourly wage or the standardized amount of the area
to which the hospitals seek reclassification must be higher than the
corresponding figure of the area in which the hospitals are located for
the group to qualify for reclassification. These revisions are
effective for applications for reclassification due by October 2, 1995,
for reclassifications effective October 1, 1996. We received two
comments on our proposal to prohibit a hospital from reclassifying to
an area in which the pre-reclassification average hourly wage is lower
than the pre-reclassification average hourly wage in the hospital's
current area, both of which agreed with our changes. Therefore, we will
implement this requirement beginning with MGCRB applications due
October 2, 1995, effective for reclassifications for FY 1997.
Comment: Although we made no proposal regarding the 108 percent
criterion, two commenters wrote to state their concern about the impact
of that criterion in relation to hospital reclassification for wage
index purposes. The current regulations require that among other
criteria, a hospital that seeks to be reclassified must have an average
hourly wage that equals or exceeds 108 percent of the average hourly
wage of the area in which it is located. One commenter believes that
this test is inappropriate, especially for hospitals that are the
predominant wage payers in an area. The commenter states that as a
hospital's wage influence in a labor market area increases, it becomes
proportionately less likely to satisfy the 108 percent rule.
Response: We continue to believe that the 108 percent test is a
reliable measure for determining whether hospitals are truly aberrant
within their labor market areas and merit reclassification. We also do
not believe that it would be appropriate to exclude a hospital from its
labor market area in order for the hospital to qualify for
reclassification. Our policy has been that the wage data for all
hospitals located in a labor market area is to be used when determining
reclassification qualification. If one hospital is so dominant as to
affect the labor market area to the extent noted by the commenter, the
resulting average hourly wage (and thus the wage index value of the
area) is also affected by that hospital. Removing the dominant
hospital's data from the hourly wage calculation for purposes of
meeting the 108 percent test would, in our view, lead to inappropriate
reclassifications.
2. Hospital Requests for Wage Data from HCFA
Currently, regulations at Sec. 412.266 provide that a hospital may
request from HCFA certain wage data that are necessary for a complete
reclassification application to the MGCRB. The regulations also set
forth dates by which HCFA must respond to such requests. Before 1994,
hospitals needed to obtain data on average hourly wages directly from
HCFA, since the data were not available from any other source.
Beginning with the May 27, 1994, proposed rule, we have included the
average hourly wage data for each hospital in the proposed and final
rules as part of Table 3c. Therefore, hospitals no longer need to
contact HCFA to obtain the data necessary to apply for
reclassification. Thus, we are revising Sec. 412.266 to indicate that
hospitals are to obtain the necessary data from the Federal Register
document. We received no comments on this change and are adopting it as
proposed.
3. Elimination of the MGCRB
As discussed above, under section 1886(d)(10) of the Act, the MGCRB
is charged with reviewing and making decisions on hospital requests for
geographic reclassification. Since implementation of this process 5
years ago, many changes have been made to the criteria that hospitals
must meet in order to qualify for reclassification. The majority of
these criteria are now
[[Page 45803]]
objective standards that are easily assessed. However, the MGCRB
application process remains essentially unchanged. We solicited
comments concerning alternatives for revising and simplifying the
reclassification system (60 FR 29218) including the possibility of
eliminating the MGCRB and transferring its decisionmaking authority to
HCFA. In addition, we suggested that if the reclassification process
was revised and simplified, it might be possible to use more current
wage data in making reclassification decisions.
Comment: We received seven comments in response to our suggestion
that the MGCRB could be eliminated. Five of the commenters were opposed
to this suggestion and two stated that they were not opposed to such a
change. One of the latter two commenters agreed with us that the
criteria for reclassification are essentially mechanical and can be
applied unambiguously by an administering agency.
The commenters opposed to the elimination of the MGCRB believe that
the Board remains the appropriate entity for reviewing reclassification
applications and should be preserved. Commenters stated that the
independent administrative review offered by the MGCRB is necessary to
counterbalance the authority that HCFA holds over the process through
its implementation of strict numerical standards and the statutory
prohibition on judicial review of MGCRB and Administrator decisions.
Several commenters requested that, rather than eliminate the Board
because of the more mechanical nature of its review, HCFA should
restructure the qualifying criteria for reclassification to allow the
MGCRB the ability to consider a wide range of hospital-specific facts
in determining whether geographic reclassification would be appropriate
for a particular hospital or group of hospitals.
One commenter stated that in proposing to use more current wage
data HCFA must not have examined its own time line. Using more current
data would require either not allowing hospitals time to review their
wage data prior to reclassification, or moving the fiscal intermediary
review of wage data to earlier in the wage data verification process.
The commenter believes that it is essential not to limit the amount of
time hospitals have to review their own wage data before it is
implemented.
Another commenter noted that it might be possible to improve the
MGCRB process without transferring the Board's functions to HCFA. The
commenter stated that they would support a legislative proposal to
change the March 30 deadline for MGCRB decisions if it would allow for
the improvement of the process and the use of more accurate data.
Response: We will take the commenters' suggestions into account as
we consider whether to pursue statutory changes in the law governing
the reclassification process. Regarding the comments that eliminating
the Board would grant too much authority to HCFA, we believe that
instituting a process in which HCFA rather than the MGCRB makes the
geographic reclassification decisions would not result in a
significantly different outcome. This is because of the basically
objective nature of the current reclassification criteria and provision
for the Administrator's discretionary review as set forth in the
regulations at Sec. 412.278(c). In addition, we believe that a process
that is handled entirely by HCFA could lead to some administrative
simplification in the application process. We understand the concerns
about using more recent wage data that has not been thoroughly verified
through the process described in section III. B of this preamble and
will bear these concerns in mind as we further analyze potential
changes.
4. MGCRB Address Change
The MGCRB has recently moved its offices to a new location.
Therefore, hospitals that wish to apply to the MGCRB for geographic
reclassification for FY 1997 should submit their applications to the
following new mailing address: MGCRB; P.O. Box 31713; Baltimore, MD,
21207-8713. The address for deliveries is: MGCRB; 7500 Security
Boulevard; Room C1-09-13; Baltimore, MD 21244-1850.
F. Alternative Labor Market Areas
In the proposed rule, we summarized our position with regard to
further research into changing labor market areas and summarized the
major comments we received in response to last year's proposals for
potential revisions to labor market areas. There was no consensus among
the commenters on the potential options for new labor market areas.
Many individual hospitals that commented expressed dissatisfaction with
all of the proposals.
One of the options for revising labor market areas was a blended
wage index that used the MSA-based system but generally gave a
hospital's own wages a higher weight than under the current system.
Under this option the wage index of each hospital would be based on a
average of that hospital's own average hourly wages and the average
hourly wages of other hospitals in its labor area (either an MSA or
Statewide rural area). We stated that while we believed a blended wage
index might have merit, we were not planning to propose it given the
generally negative comments we received on changes in the labor market
areas.
Comment: We received two comments in response to our summary of
labor market comments in the proposed rule. One commenter endorsed our
statement that there was no clear ``best'' labor market option to
pursue. The commenter also stated that the current wage areas coupled
with the reclassification process best measures hospital labor market
areas. The other commenter expressed disappointment that we had decided
not to endorse an alternative labor market classification system such
as the blended wage index. This commenter asserted that a blended wage
index, in which a hospital's wages would generally be given greater
weight in developing the hospital's wage index than under the current
system, would not cause hospitals to increase their wages in order to
increase payments. The commenter also expressed disappointment that we
did not propose a method for redefining the Boston New England County
Metropolitan Area (NECMA) which the commenter believes is too large to
encompass the actual Boston labor market area.
Response: The Boston NECMA was expanded by OMB as part of its
revised MSA definitions based on 1990 data. As we noted in the
September 1, 1993 final rule (58 FR 46292) in response to a similar
comment, pursuant to our broad discretion under section 1886(d)(3)(E)
of the Act, we currently define labor market areas for purposes of the
wage index on the basis of MSAs and NECMAs. Thus, until alternative
labor market areas are established we believe the MSA definitions
should be applied consistently for purposes of the wage index. Since
there does not appear to be a consensus among hospitals on new labor
market areas, we have not made any proposals in this area. As we stated
in the proposed rule, we are willing to conduct additional research if
we receive recommendations of feasible options that we have not
explored previously.
IV. Other Decisions and Changes to the Prospective Payment System for
Inpatient Operating Costs
A. Payment for Transfer Cases (Section 412.4)
The prospective payment system distinguishes between
``discharges,''
[[Page 45804]]
situations in which a patient leaves an acute-care hospital after
receiving complete treatment, and ``transfers,'' situations in which
the patient is transferred to another acute-care hospital for related
care. If a full DRG payment were made to each hospital involved in a
transfer situation irrespective of the length of time the patient spent
in the ``sending'' hospital before transfer, this would create a strong
incentive to increase transfers, thereby unnecessarily endangering
patients' health. Therefore, the regulations at Sec. 412.4(d) provide
that, in a transfer situation, full payment is made to the final
discharging hospital and each transferring hospital is paid a per diem
rate for each day of the stay, not to exceed the full DRG payment that
would have been made if the patient had been discharged without being
transferred.
Currently, the per diem rate paid to a transferring hospital is
determined by dividing the full DRG payment that would have been paid
in a nontransfer situation by the geometric mean length-of-stay for the
DRG into which the case falls. Transferring hospitals are also eligible
for outlier payments for cases that meet the cost outlier criteria
established for all cases (nontransfer and transfer cases alike)
classified to the DRG. They are not, however, eligible for day outlier
payments. Two exceptions to the transfer payment policy are transfer
cases classified into DRG 385 (Neonates, Died or Transferred to Another
Acute Care Facility) or DRG 456 (Burns, Transferred to Another Acute
Care Facility), which are not paid on a per diem basis but instead
receive the full DRG payment.
In the May 27, 1994 proposed rule, we proposed to revise our
payment methodology for transfer cases. Under the proposal, for the
first day of a transfer, the per diem amount would be doubled, while a
flat per diem amount would be paid for each succeeding day, up to the
full DRG payment (59 FR 27734). We also proposed at that time to change
our definition of a transfer case to include cases transferred from an
acute-care setting paid under the prospective payment system to a
hospital or unit excluded from the prospective payment system. When we
published the September 1, 1994 final rule with comment period, we
withdrew these proposals for FY 1995 (59 FR 45362) based on negative
comments and further analysis. In that final rule, however, we stated
our intention to continue to evaluate the appropriateness of our
transfer policy.
For FY 1996, we again proposed to adopt a graduated per diem
payment methodology for transfer cases. Again, under this methodology,
we would pay double the per diem amount for the first day and the per
diem amount for subsequent days (up to the full DRG amount). We did not
propose to revise our definition of transfers. However, we noted that
we were concerned about an accelerating trend toward earlier discharges
to postacute settings. Therefore, we solicited public comments
regarding this trend and the implications this has for the design of
our payment systems. In its March 1, 1995 report, ProPAC supported our
proposed payment methodology (Recommendation 11) and expressed its
concern ``about the continuity of care across treatment settings.'' The
Commission also indicated its willingness to work with the Secretary to
explore this issue. The following discussion describes our change to
the transfer payment methodology and some of the issues identified by
our further analysis of transfer cases.
1. Payment for Transfer Cases
As part of a study of Medicare transfer cases funded by HCFA
(``Transfers of Medicare Hospital Patients under the Prospective
Payment System'', PM-191-HCFA, January 1994), RAND found that among
cases transferred before reaching the geometric mean length-of-stay, 1-
day stays cost 2.096 times the per diem payment amount for cases in
nonsurgical DRGs and 2.576 times the per diem for surgical DRGs (based
on FY 1991 data). Among nonsurgical transfer cases, the costs of 2-day
stays were about 1.215 times the per diem payment amount, and cases
transferred after 2 days cost about 10 percent more than the applicable
per diem amount. Among surgical cases, the costs of stays of 2 or more
days were actually about 7 percent below the applicable per diem
amount.
In order to pay hospitals more appropriately for the treatment they
furnish to patients before transfer, we proposed to revise
Sec. 412.4(d)(1) to pay transfers twice the per diem amount for the
first day of any transfer stay plus the per diem amount for each of the
remaining days before transfer, up to the full DRG amount. (Our
concerns about basing the gradation of the per diem scale on the actual
coefficients as estimated by RAND were described in last year's
proposed and final rules, as referenced above.) This change will apply
uniformly for both medical and surgical transfer cases; although
surgical transfer cases appear to be more costly on average for the
first day, they are relatively less costly for the second day and
beyond.
If the patient is transferred again before final discharge, then,
under this change, all sending hospitals involved would be paid using
the graduated per diem methodology rather than the flat per diem rate
they currently receive. For example, a case transferred from a
community hospital to a tertiary care hospital for a procedure that is
not performed at the community hospital, may subsequently be
transferred back to the community hospital, which ultimately discharges
the patient home. In such a case, the community hospital and the
tertiary care hospital would be paid using the transfer payment
methodology for the first two phases of the hospitalization, and the
community hospital would also receive a DRG amount for the final phase
when it discharges the patient. This is our current policy, as well.
Each phase of the hospitalization is assigned a DRG based on the
diagnosis and procedures applicable to that particular phase;
therefore, a different DRG could be assigned to each phase.
Transfer cases would continue to be eligible for additional
payments as cost outliers. In the September 1, 1993 final rule, we set
forth revised qualifying criteria for transfer cases to be eligible for
cost outlier payments (58 FR 46305). Before that change, transfer cases
were required to meet the same criteria to qualify for cost outliers as
were discharges. The revised policy adjusts the outlier threshold for
transfer cases to reflect the fact that transfer cases were receiving a
reduced payment amount under the per diem methodology. Last year, when
we revised the cost outlier qualifying criteria so that it was based on
a fixed loss threshold, the qualifying criteria for transfers continued
to reflect the fact that their payment amounts are reduced relative to
the full DRG amount. Although we did not state this explicitly in the
September 1, 1994 final rule, it is the policy we have employed, and
intend to continue to employ, since the fixed loss threshold was
implemented October 1, 1994. In the proposed rule, we described the
cost outlier threshold for transfer cases as equal to the fixed loss
amount (for FY 1995, the prospective payment rate for the DRG plus
$20,500), divided by the geometric mean for the DRG, multiplied by the
length of stay before transfer. In order to maintain the correct
relationship between the payment received under the new graduated per
diem methodology and the outlier threshold, for FY 1996, the per diem
outlier threshold should be multiplied by the length of stay before
transfer plus one day. Of course, the threshold is limited
[[Page 45805]]
to the prospective payment rate for the DRG plus the fixed loss amount.
Using the graduated per diem methodology, RAND estimated the
payment-to-cost ratio of transfer cases that were transferred before
reaching the geometric mean length of stay would be 0.9321. While this
is somewhat less than the payment-to-cost ratio for nontransfer cases
(0.9645), it represented a significant improvement over the current
ratio for transfer cases (0.7224). Using more recent data (FY 1993
MedPAR) and payment policies (FY 1995), we estimated the improvement in
the payment-to-cost ratio for transfer cases to be from 0.7548 under
the current flat per diem policy to 0.9701 under the graduated per diem
policy.
Section 109 of the Social Security Act Amendments of 1994 (Public
Law 103-432), which amended section 1886(d)(5)(I) of the Act,
authorized the Secretary to make adjustments to the prospective payment
system standardized amounts so that adjustments to the payment policy
for transfer cases do not affect aggregate payments. In light of this
authority, we believe the benefits of the graduated per diem
methodology now outweigh the concerns that we expressed in the
September 1, 1994 final rule. Our methodology for applying this
adjustment was described in section II of the Addendum to the proposed
rule and is included in this final rule as well.
Finally, we proposed to revise the DRG recalibration methodology so
that transfer cases are treated as a proportion of a full case based on
the transfer payment amount (as discussed above in section II.C of this
preamble). Specifically, we proposed to weight transfer cases as less
than a full discharge based on the proportion of the total DRG amount
the hospital receives under the graduated per diem transfer payment
methodology. This has the effect of increasing the relative weights of
the DRGs with a high number of short-stay transfer cases.
Comment: All of the comments we received regarding our revision to
the transfer payment methodology were in support of the proposal.
ProPAC wrote that ``(t)his policy will improve payment equity for
hospitals that must transfer a large number of patients to other
hospitals.''
Response: All of the comments favored our proposal, and we have
adopted the proposal without change. We appreciate ProPAC's valuable
contribution to the analysis of the transfer payment methodology. We
share its conclusion that this change will appropriately benefit
hospitals that transfer large numbers of patients.
2. Definition of a Transfer Case
Under current policy, cases that are transferred from an acute-care
hospital paid under the prospective payment system to another type of
provider or unit are considered to be discharges (as opposed to
transfers) from the acute-care hospital. As a discharge, payment for
the case is the full DRG amount.
As noted above, we are concerned that the current trend of
declining average lengths of stay as hospitals transfer Medicare
patients into alternative health care settings (other than acute care)
in less time may result in a misalignment of payments and costs under
our existing payment systems. In particular, we are concerned that
hospitals paid under the prospective payment system may be shifting
costs (for which they are compensated through the DRG payments) to
alternative settings, which in turn may be paid on a cost basis.
In the September 1, 1994 final rule, we explained our rationale for
proposing to consider patients transferred to excluded hospitals or
units as transfers rather than discharges. Briefly, our proposal was
``based upon the premise that an increasing number of patients are
being transferred to excluded hospitals or units and that these
patients are still in the acute care phase of treatment when they are
transferred.'' (See 59 FR 45364.) We also explained our reason for
continuing to consider patients going to a skilled nursing facility
(SNF) as discharges. In that regard, we stated that ``(w)e did not
propose to consider discharges to SNFs as transfers because we do not
consider SNFs to be hospital settings; thus, there is generally little
overlap with acute care hospitals in the services provided.'' Based
upon further analysis of patient discharge trends and research on the
type and outcomes of care provided in SNFs, as well as anecdotal
evidence drawn from the health care industry, we no longer believe
there is a clear distinction between the type of care provided in SNFs
and the type of care provided in hospitals or units excluded from the
prospective payment system, such as rehabilitation and long-term care
facilities.
Therefore, we considered proposing to expand our definition of
transfers to include not only cases going from one hospital paid under
the prospective payment system to another but also cases transferred to
excluded hospitals and units as well as SNFs. However, as discussed
below, our analysis has identified problems that need to be addressed.
Nevertheless, once we are convinced these problems can be effectively
handled, we intend to proceed with implementing policy changes designed
to remedy this issue.
First, our analysis (as well as anecdotal evidence) indicates that
the settings where acute care is now being delivered are rapidly
expanding and evolving. To the extent that payment is affected by where
a patient goes after an acute hospitalization, it is critical to
understand the clinical capabilities of different types of settings, so
that the incentives created by the payment system do not unduly
influence the choice of where to send a patient for postacute care.
That is, all like provider settings should be treated equally in terms
of payment incentives. Currently, the settings that are considered as
alternatives to acute care are expanding rapidly, and we want to be
sure that we do not create unforeseen financial incentives toward one
alternative over another by any redefinition of transfers.
In addition, as discussed in last year's final rule, hip
replacement cases (which, as a group, constitute one of the largest
sources of Medicare cases moving from acute to postacute settings)
would be systematically underpaid under either the current or the
proposed per diem methodology. This is because the cost of the surgery
including the prosthetic device, which is incurred in the first day or
two of the stay, constitutes a large percentage of the total cost of
the stay. A graduated per diem would have to be skewed greatly toward
the first day to approximate the daily cost distribution.
We, therefore, solicited public comment with regard to these
issues. Specifically, we were interested in suggestions on how best to
adapt our payment methodologies for hospitals and units (both acute
care paid under the prospective payment system and those excluded from
this system), SNFs, and home health agencies in response to the
evolving integrated delivery systems. We were particularly interested
in comments and suggestions on how to design a comprehensive payment
system that better matches payments with the costs providers actually
incur in furnishing care (that is, reducing hospital payments when a
significant phase of a patient's acute episode is treated in other than
an acute hospital inpatient setting). A major issue in developing such
an integrated payment system is to neutralize the incentives that arise
in terms of where patients are treated. For example, hospitals should
continue to be adequately compensated for acute inpatient
hospitalization where appropriate, so that there will not
[[Page 45806]]
be an adverse incentive to move patients prematurely to alternative
settings.
We appreciate the numerous comments we received in response to this
solicitation. Many of them shed new light on our understanding of the
complicated issues involved, and will serve to enhance our analysis as
we grapple with these issues in the future.
Comment: Many commenters misinterpreted our discussion related to
the definition of transfer cases as a proposal to expand the definition
to include patients moving from an acute care hospital to a hospital or
unit excluded from the prospective payment system or to an SNF.
Response: We wish to make clear that we did not propose a change to
the definition of transfers. We identified an expanded definition (one
that would encompass patients going to SNFs) as one possible approach.
We went on, however, to discuss why we were not proposing to make such
a change to the definition at this time. Furthermore, we did not
suggest that we would pay postacute care providers on the basis of the
hospital DRGs.
Comment: The majority of the commenters who discussed an expanded
definition of transfers as one approach to address the blurring
distinction between different sites of care were opposed to it. Several
commenters argued that there remains a clear distinction between the
care provided in acute care hospitals and that provided by postacute
care providers, and therefore it would be inappropriate to consider
these cases as transfers. The point was also raised that defining these
cases as transfers would create a financial incentive to hold them in
the acute care hospital longer, in order to avoid a reduction in
payment. On the other hand, some commenters pointed to ``perverse
incentives'' under the current system that encourage early discharges.
Some commenters who argued against last year's proposal wrote to
support a redefinition of transfers that includes SNFs. These
commenters indicated they were in favor of an expanded definition if it
included cases going to SNFs as transfers. Conversely, several
commenters opposed including cases going to SNFs, arguing that ``HCFA
will not accomplish its goal since it will effectively remove any
incentive for hospitals to move patients into a more cost-effective
setting for subacute care.'' Not surprisingly, opinions on whether any
redefinition of transfers should include cases going to SNFs divided
along lines of whether the commenter represented SNFs or excluded
hospitals.
Response: We would like to make clear that we recognize the
importance of rehabilitative care as a necessary and distinct phase of
the episode of care for many patients. Similarly, we recognize the
historical distinctions between different providers of postacute care,
as evidenced, for example, by our different payment policies for
excluded hospitals and SNFs. Nevertheless, we are convinced these
distinctions have recently become increasingly ill-defined. Part of the
difficulty in addressing this issue, however, is that, while some
providers have taken great strides toward integrating their health care
delivery systems, many others continue to operate under the more
traditional approach, with clear distinctions existing between the
providers at different phases of patients' care.
We have repeatedly indicated our belief that the incentives created
by our payment policy should be neutral in terms of the settings where
patients receive care. That is, the payment received should correspond
to the costs of the care provided, so that decisions regarding the
appropriate site of care are based on clinical, not economic, concerns.
As noted above, our concern stems from increasing indications that in
certain contexts our present payment system no longer reflects provider
costs as accurately as it once did. On the other hand, we believe that,
for the most part, our per diem payment methodology for transfer cases
does meet this test. Although payments for transfer cases are reduced
relative to full discharges, they reflect the reduction in resources
hospitals commit to these cases (particularly under our graduated per
diem methodology). However, one of the issues of expanding this
transfer payment methodology to cases going to excluded hospitals and
units, as well as SNFs, is the underpayment for hip replacements. To
the extent that the transfer payment is below costs, economic
considerations are more likely to enter into the decision of when to
release a patient and to which type of setting.
Finally, with regard to whether any redefinition of transfers
should or should not include SNFs, we noted in the proposed rule (and
reiterated above) that patients appear to be going to SNFs sooner from
acute care settings. On the whole, the comments we received reinforced
this belief. We will, however, continue to evaluate this issue.
Comment: Some commenters indicated that the redefinition of
transfers should apply only to hospital-based distinct part units or in
the case of long-term care hospitals, to a ``hospital within a
hospital,'' where the incentive to transfer early is strongest. In the
words of two commenters: ``(t)his perverse situation is becoming more
common as States make it easier for hospitals to circumvent the normal
health planning process to convert excess acute care beds to cost-
based, distinct part units.''
Response: We share many of the concerns expressed in these comments
regarding the special potential for abuse that exists in such
situations, and have addressed some of the potential abuses inherent in
the ``hospital within a hospital'' arrangements in section IV of this
preamble. However, we have historically recognized that many of the
distinct part unit situations arise from legitimate efficiency
incentives on the part of hospital administrators. In addition,
implementing such a proposal would likely multiply the types of
problems arising in the ``hospital within a hospital'' issue, as
hospitals devise new relationships for postacute care.
Comment: It was suggested that, if we redefine transfers to include
cases moving to excluded hospitals and units as well as SNFs, one State
should be exempted because, among other reasons, the State's hospitals
cannot establish exempt units without receiving a State Certificate of
Need.
Response: One of the major factors leading us to pursue refinements
with respect to this issue is the fact that not all areas of the
country have equal access to postacute care alternatives. Currently,
among those DRGs experiencing the most dramatic declines in length of
stay, the relative weights are declining as the resources expended for
these cases by acute care hospitals around the country decline.
Because, effective for FY 1996, for purposes of recalibrating the DRGs,
transfer cases are weighted in proportion to their payments, expanding
the definition of transfer cases would alleviate some of the downward
impact these cases have on the DRG weights. Hospitals lacking the
opportunity to decrease their lengths of stay by transferring patients
to postacute care settings would thereby benefit.
Comment: A number of commenters suggested that the appropriate
means to address the issue of declining lengths of stay was through the
DRGs and the prospective payment system, not the definition of a
transfer. One commenter, for example, correctly asserts that the
reduced resources attributable to cases discharged early from the acute
hospital would ultimately result in lower DRG weights. Others called
for the system to be rebased in order to capture the savings from the
shorter lengths of stay.
[[Page 45807]]
Many commenters argued that it would be inappropriate to reduce
payments for cases discharged prior to the mean without simultaneously
increasing payments for cases discharged after the mean.
Response: An integral concept of the prospective payment system is
that a predetermined payment can be made for an identifiable and
distinct phase of care. To the extent that hospitals can provide this
acute phase of patients' care at costs below average, they profit under
this system. In response to this incentive, lengths of stay declined
dramatically in the first few years after implementation of the
prospective payment system.
Our concern regarding the misalignment of payments and costs arises
when the acute phase of care may no longer be completed within the
hospital. At that point, it is no longer sufficient to rely on the
recalibration of the relative weights of the DRGs to correct the
balance between payments and costs. Recalibration is, by definition, a
budget neutral process. While payments will decline for the DRGs with
cases that are being moved earlier out of the hospital, this decline
will necessarily be offset by relative increases for other DRGs. The
net result is that total payments systemwide are the same despite the
cost reductions.
One way of potentially capturing these reductions would be to
rebase the standardized amounts using more recent cost data. We are not
convinced at this time, however, that such a dramatic approach is
warranted. In addition, due to the need to use audited cost data in any
such rebasing, it is questionable to what extent rebasing at this time
would capture these savings, since this trend has apparently begun to
accelerate only in the last year or two.
We disagree with the comments that it is inappropriate to reduce
payments for cases discharged prior to the mean without simultaneously
increasing payments for cases discharged after the mean. Cases with
long lengths of stay may be eligible for outlier payments. In addition,
as we pointed out in last year's final rule, generally fewer than 10
percent of cases in the DRGs most likely to receive postacute care
leave the acute care hospital before the geometric mean length of stay,
minus one day, and would therefore receive payment under the per diem
methodology (59 FR 45365).
Comment: Several commenters noted that our current payment
methodologies are predominately fee-for-service, and that this method
of paying for health care will become much less prevalent in the near
future. These commenters suggested that under a Medicare capitated
payment methodology many of the issues with which we are concerned will
resolve themselves.
Response: We agree that issues pertaining to properly allocating
payments among service providers is significantly a function of our
fee-for-service payment systems, which are largely required by the
Medicare law. Nevertheless, given the amount of money currently paid
through our fee-for-service systems, and the projections from the
Office of the Actuary regarding the Medicare Trust Fund, the need to
address this issue is pressing. Therefore, given the uncertainty about
major legislative changes to our payment systems, we intend to pursue a
solution that can be implemented relatively soon.
Comment: In response to our request, we received numerous
suggestions for alternative approaches to address the evolving
integration of the various phases of a patient's care across different
provider settings. In the timeframe we are under to publish this final
rule, we cannot appropriately analyze and respond to all of them.
Additional comments we received included the following:
There is no current infrastructure to accommodate a
bundled payment system for acute and postacute care.
HCFA should rely on the utilization review process to
identify individual abusive providers and deal with them on an
individual basis.
HCFA should pursue its stated intention to better
understand the clinical capabilities of various postacute settings.
All types of providers of inpatient rehabilitation
services should be under the same payment system (the Functional
Related Groups concept was suggested).
Hospital outpatient services should be included in the
analysis of postacute care.
HCFA should establish a commission to consider both the
financial and clinical aspects of postacute care.
A new discharge status code should be established for
patients transferred for subacute, rather than postacute, care.
A number of revisions to SNF payment policy were also recommended,
including a more stringent review of cost limit exception requests, a
cap on exceptions based on like providers, elimination of the 3-day
hospital stay requirement for Medicare SNF coverage, permitting
providers to establish multiple distinct parts, and applying the
hospital-based routine cost limits to freestanding SNFs.
Response: As noted above, we appreciate the many suggestions we
received and will take each into consideration as we pursue our
options. In addition, we anticipate that we will continue to work with
the hospital industry as we proceed in our efforts to address this
problem.
B. Physician Attestation (Section 412.46)
Under current Medicare regulations at Sec. 412.46(a), physicians
are required to sign an attestation statement for each hospital
discharge before the claim can be submitted to the intermediary for
payment. With this attestation, the physician is certifying the
accuracy of the principal and secondary diagnoses and the major
procedures performed for each patient during the inpatient stay.
Because this information dictates which DRG is assigned to a case, it
is extremely important that it be correct so that proper Medicare
payment can be made.
The attestation statement the physicians sign reads as follows:
I certify that the narrative descriptions of the principal and
secondary diagnoses and the major procedures performed are accurate
and complete to the best of my knowledge. (Sec. 412.46(a).)
Although a hospital official is required to certify on each Medicare
claim form that all the data are correct, when the prospective payment
system was first implemented, we believed that we needed a clear
statement for each claim concerning the validity of that data. At the
time, we believed that the physician was in the best position to attest
to the information.
The hospital must also have on file a signed and dated
acknowledgement from the attending physician that the physician has
received the following notice:
Notice to Physicians: Medicare payment to hospitals is based in
part on each patient's principal and secondary diagnoses and the
major procedures performed on the patients, as attested to by the
patient's attending physician by virtue of his or her signature in
the medical record. Anyone who misrepresents, falsifies, or conceals
essential information required for payment of Federal funds, may be
subject to fine, imprisonment, or civil penalty under applicable
Federal laws. (Sec. 412.46(c)(1).)
We implemented these requirements to ensure a means of holding
hospitals and physicians accountable for the information they submit on
the Medicare claims form. At the time, we believed that these
statements were valuable tools for ensuring the validity of DRG claims.
Over the years, we have received many complaints from both
hospitals
[[Page 45808]]
and physicians concerning the administrative burden of completing the
attestation and acknowledgement statements. In a final rule with
comment period published in the Federal Register on March 9, 1994 (59
FR 11003), we revised the regulations to require that a physician need
sign the acknowledgement statement only upon receiving admitting
privileges at a hospital and no longer was required to sign the
statement every year.
In practice, review of attestation statements by the Peer Review
Organizations (PROs) as a part of DRG validation review has resulted in
less than a 0.01 percent denial rate of sampled claims. Therefore, in
an effort to reduce burden, we are revising the regulations to
eliminate the physician attestation requirement.
We believe that this will reduce the burden on both physicians, who
must sign an attestation on each of the approximately 11 million
Medicare inpatient claims a year, and on hospitals, which are
responsible for obtaining the signatures before they can submit
completed claims for payment. In addition, the hospital claim form (UB-
92), which must be signed by a hospital representative, contains a
certification statement that reads as follows:
Anyone who misrepresents or falsifies essential information
requested by this form may upon conviction be subject to fine and
imprisonment under Federal or State law.
Because the hospital remains responsible for certifying that the
hospital claim is accurate, we believe that we can hold the hospital
responsible for the accuracy of the diagnostic and procedural
information. We are revising revise Sec. 412.46 by eliminating
paragraphs (a), (b), (d), and (e). We note that on January 20, 1995,
HCFA notified its Regional Offices that the PROs would no longer be
responsible for performing attestation review.
Although this revision was not included in the proposed rule, we
did receive many comments requesting that we eliminate the physician
attestation requirement. In addition, this change was announced in July
by Vice President Albert Gore, as one of the Administration's health
care regulatory reforms.
C. Rural Referral Centers (Section 412.96)
Under the authority of section 1886(d)(5)(C)(i) of the Act,
Sec. 412.96 sets forth the criteria a hospital must meet in order to
receive special treatment under the prospective payment system as a
rural referral center. For discharges occurring before October 1, 1994,
rural referral centers received the benefit of payment based on the
other urban payment rate rather than the rural payment rate. As of that
date, the other urban and rural payment rates are the same. However,
rural referral centers continue to receive special treatment under both
the disproportionate share hospital payment adjustment and the criteria
for geographic reclassification.
One of the criteria under which a rural hospital may qualify as a
referral center is to have 275 or more beds available for use. A rural
hospital that does not meet the bed size criterion can qualify as a
rural referral center if the hospital meets two mandatory criteria
(number of discharges and case-mix index) and at least one of three
optional criteria (medical staff, source of inpatients, or volume of
referrals). With respect to the two mandatory criteria, a hospital may
be classified as a rural referral center if its--
Case-mix index is at least equal to the lower of the
median case-mix index for urban hospitals in its census region,
excluding hospitals with approved teaching programs, or the median
case-mix index for all urban hospitals nationally; and
Number of discharges is at least 5,000 discharges per year
or, if fewer, the median number of discharges for urban hospitals in
the census region in which the hospital is located. (The number of
discharges criterion for an osteopathic hospital is at least 3,000
discharges per year.)
1. Case-Mix Index
Section 412.96(c)(1) provides that HCFA will establish updated
national and regional case-mix index values in each year's annual
notice of prospective payment rates for purposes of determining rural
referral center status. In determining the proposed national and
regional case-mix index values, we followed the same methodology we
used in the November 24, 1986 final rule, as set forth in regulations
at Sec. 412.96(c)(1)(ii). Therefore, the proposed national case-mix
index value included all urban hospitals nationwide, and the proposed
regional values were the median values of urban hospitals within each
census region, excluding those with approved teaching programs (that
is, those hospitals receiving indirect medical education payments as
provided in Sec. 412.105).
The values in the proposed rule were based on discharges occurring
during FY 1994 (October 1, 1993 through September 30, 1994) and
included bills posted to HCFA's records through December 1994.
Therefore, in addition to meeting other criteria, we proposed that to
qualify for initial rural referral center status or to meet the
triennial review standards for cost reporting periods beginning on or
after October 1, 1995, a hospital's case-mix index value for FY 1994
would have to be at least--
1.3165; or
Equal to the median case-mix index value for urban
hospitals (excluding hospitals with approved teaching programs as
identified in Sec. 412.105) calculated by HCFA for the census region in
which the hospital is located. (See the table set forth in the June 2,
1995 proposed rule at 60 FR 29222.)
Based on the latest data available (FY 1994 bills received through
June 1995), the final national case-mix value is 1.3184 and the median
case-mix values by region are set forth in the table below:
------------------------------------------------------------------------
Case-mix
Region index
value
------------------------------------------------------------------------
1. New England (CT, ME, MA, NH, RI, VT)...................... 1.2135
2. Middle Atlantic (PA, NJ, NY).............................. 1.2077
3. South Atlantic (DE, DC, FL, GA, MD, NC, SC, VA, WV)....... 1.3141
4. East North Central (IL, IN, MI, OH, WI)................... 1.2288
5. East South Central (AL, KY, MS, TN)....................... 1.2814
6. West North Central (IA, KS, MN, MO, NE, ND, SD)........... 1.1892
7. West South Central (AR, LA, OK, TX)....................... 1.2986
8. Mountain (AZ, CO, ID, MT, NV, NM, UT, WY)................. 1.3630
9. Pacific (AK, CA, HI, OR, WA).............................. 1.3300
------------------------------------------------------------------------
For the benefit of hospitals seeking to qualify as referral centers
or those wishing to know how their case-mix index value compares to the
criteria, we are publishing each hospital's FY 1994 case-mix index
value in Table 3C in section V of the addendum to this final rule. In
keeping with our policy on discharges, these case-mix index values are
computed based on all Medicare patient discharges subject to DRG-based
payment.
2. Discharges
Section 412.96(c)(2)(i) provides that HCFA will set forth the
national and regional numbers of discharges in each year's annual
notice of prospective payment rates for purposes of determining
referral center status. As specified in section 1886(d)(5)(C)(ii) of
the Act, the national standard is set at 5,000 discharges. However, we
proposed to update the regional standards. The proposed regional
standards were based on discharges for
[[Page 45809]]
urban hospitals' cost reporting periods that began during FY 1993 (that
is, October 1, 1992 through September 30, 1993). That is the latest
year for which we have complete discharge data available.
Therefore, in addition to meeting other criteria, we proposed that
to qualify for initial rural referral center status or to meet the
triennial review standards for cost reporting periods beginning on or
after October 1, 1995, the number of discharges a hospital must have
for its cost reporting period that began during FY 1994 would have to
be at least--
5,000; or
Equal to the median number of discharges for urban
hospitals in the census region in which the hospital is located. (See
the table set forth in the June 2, 1995 proposed rule at 60 FR 29222.)
Based on the latest discharge data available, the final median
numbers of discharges for urban hospitals by census regions are as
follows:
------------------------------------------------------------------------
No. of
Region discharges
------------------------------------------------------------------------
1. New England (CT, ME, MA, NH, RI, VT)..................... 6815
2. Middle Atlantic (PA, NJ, NY)............................. 8618
3. South Atlantic (DE, DC, FL, GA, MD, NC, SC, VA, WV)...... 7500
4. East North Central (IL, IN, MI, OH, WI).................. 7155
5. East South Central (AL, KY, MS, TN)...................... 5582
6. West North Central (IA, KS, MN, MO, NE, ND, SD).......... 5135
7. West South Central (AR, LA, OK, TX)...................... 4464
8. Mountain (AZ, CO, ID, MT, NV, NM, UT, WY)................ 8179
9. Pacific (AK, CA, HI, OR, WA)............................. 5594
------------------------------------------------------------------------
We reiterate that, to qualify for rural referral center status for
cost reporting periods beginning on or after October 1, 1995, an
osteopathic hospital's number of discharges for its cost reporting
period that began during FY 1994 would have to be at least 3,000.
3. Retention of Referral Center Status
Section 412.96(f) states the general rule that each hospital
receiving the referral center adjustment is reviewed every 3 years to
determine if the hospital continues to meet the criteria for referral
center status. To retain status as a referral center, a hospital must
meet the criteria for classification as a referral center specified in
Sec. 412.96 (b)(1) or (b)(2) or (c) for 2 of the last 3 years, or for
the current year. A hospital may meet any one of the three sets of
criteria for individual years during the 3-year period or the current
year. For example, a hospital may meet the two mandatory requirements
in Sec. 412.96(c)(1) (case-mix index) and (c)(2) (number of discharges)
and the optional criterion in paragraph (c)(3) (medical staff) during
the first year. During the second or third year, the hospital may meet
the criteria under Sec. 412.96(b)(1) (rural location and appropriate
bed size).
A hospital must meet all of the criteria within any one of these
three sections of the regulations in order to meet the retention
requirement for a given year. That is, it will have to meet all of the
criteria of Sec. 412.96(b)(1) or Sec. 412.96(b)(2) or Sec. 412.96(c).
For example, if a hospital meets the case-mix index standards in
Sec. 412.96(c)(1) in years 1 and 3 and the number of discharge
standards in Sec. 412.96(c)(2) in years 2 and 3, it will not meet the
retention criteria. All of the standards would have to be met in the
same year.
In accordance with Sec. 412.96(f)(2), the review process is limited
to the hospital's compliance during the last 3 years. Thus, if a
hospital meets the criteria in effect for at least 2 of the last 3
years or if it meets the criteria in effect for the current year (that
is, the criteria for FY 1996 outlined above in this section of the
preamble), it will retain its status for another 3 years. We have
constructed the following chart and example to aid hospitals that
qualify as referral centers under the criteria in Sec. 412.96(c) in
projecting whether they will retain their status as a referral center.
Under Sec. 412.96(f), to qualify for a 3-year extension effective
with cost reporting periods beginning in FY 1996, a hospital must meet
the criteria in Sec. 412.96(c) for FY 1996 or it must meet the criteria
for 2 of the last 3 years as follows:
----------------------------------------------------------------------------------------------------------------
Use the
discharges for
Use hospital's the hospital's Use numerical standards as
For the cost reporting period beginning during case-mix index cost reporting published in the Federal
FY for FY period Register on
beginning
during FY
----------------------------------------------------------------------------------------------------------------
1995............................................ 1993 1993 September 1, 1994.
1994............................................ 1992 1992 September 1, 1993.
1993............................................ 1991 1991 September 1, 1992.
----------------------------------------------------------------------------------------------------------------
Example: A hospital with a cost reporting period beginning July 1
qualified as a referral center effective July 1, 1993. The hospital has
fewer than 275 beds. Its 3-year status as a referral center is
protected through June 30, 1996 (the end of its cost reporting period
beginning July 1, 1995). To determine if the hospital should retain its
status as a referral center for an additional 3-year period, we will
review its compliance with the applicable criteria for its cost
reporting periods beginning July 1, 1993, July 1, 1994, and July 1,
1995. The hospital must meet the criteria in effect either for its cost
reporting period beginning July 1, 1996, or for two out of the three
past periods. For example, to be found to have met the criteria at
Sec. 412.96(c) for its cost reporting period beginning July 1, 1994,
the hospital's case-mix index value during FY 1992 must have equaled or
exceeded the lower of the national or the appropriate regional standard
as published in the September 1, 1993 final rule with comment period.
The hospital's total number of discharges during its cost reporting
year beginning July 1, 1992, must have equaled or exceeded 5,000 or the
regional standard as published in the September 1, 1993 final rule with
comment period.
For those hospitals that seek to retain referral center status by
meeting the criteria of Sec. 412.96(b)(1)(i) and (ii) (that is, rural
location and at least 275 beds), we will look at the number of beds
shown for indirect medical education purposes (as defined at
Sec. 412.105(b)) on the hospital's cost report for the appropriate
year. We will consider only full cost reporting periods when
determining a hospital's status under Sec. 412.96(b)(1)(ii). This
definition varies from the number of beds criterion used to determine a
hospital's initial status as
[[Page 45810]]
a referral center because we believe it is important for a hospital to
demonstrate that it has maintained at least 275 beds throughout its
entire cost reporting period, not just for a particular portion of the
year.
Comment: One commenter noted that the American Osteopathic Hospital
Association had changed its name to the American Osteopathic Healthcare
Association and requested that Sec. 412.96(c)(2)(B)(ii) be revised to
reflect this change.
Response: Section 412.96(c)(2)(B)(ii) specifies that a rural
osteopathic hospital that is recognized by the American Osteopathic
Hospital Association can meet the number of discharges criterion at
Sec. 412.96(c)(2) if it has at least 3,000 discharges for the
hospital's most recently completed cost reporting period. As requested,
we are revising Sec. 412.96(c)(2)(B)(ii) to reflect the organization's
new name. To qualify as an osteopathic hospital, the hospital must be
recognized by the American Osteopathic Healthcare Association (or any
successor organizations).
D. Determination of Number of Beds Used in Calculating the Indirect
Medical Education Adjustment (Section 412.105)
In the September 1, 1994 final rule (59 FR 45373), in an effort to
clarify our policy, we amended the regulations at Sec. 412.105(b), that
describe how to determine the number of beds in a hospital for purposes
of the indirect medical education adjustment. At that time, we added
language to the regulations that specifically excludes ``nursery'' beds
assigned to newborns ``that are not in intensive care areas'' from the
bed count. This change was supposed to clarify that, with regard to
infants, only beds in a nursery used for newborns (see section 2815 of
the Provider Reimbursement Manual-Part 2) are excluded from the count.
As we stated in the May 27, 1994 proposed rule (59 FR 27741), we made
this revision ``to exclude specifically only beds assigned to newborns
in the nursery'' (emphasis added). Furthermore, when we published the
final rule, we added the reference to nursery beds directly into the
text of Sec. 412.105(b) ``(t)o prevent any future confusion about the
term `newborn' '' (59 FR 45374).
Although we received no comments in response to the May 27, 1994
proposed rule as to whether beds occupied by sick infants in areas
other than a neonatal intensive care area or a nursery could be
counted, we continue to receive questions on this issue. Therefore, in
the June 2, 1995 proposed rule, we proposed to revise Sec. 412.105(b)
to further clarify our bed counting policy. This year, rather than
specifically identifying intensive care beds occupied by infants as
eligible to be counted, we proposed to delete that phrase and insert
the phrase ``beds in the healthy newborn nursery.'' As we stated in the
June 2 proposed rule, our policy is and has been that only beds in a
healthy, or regular, baby nursery are excluded from the count. All
other beds available for occupancy by a newborn are to be counted. We
received a number of comments on our policy clarification.
Comment: Several commenters believe that, rather than a policy
clarification, the proposed language represents a policy shift in how
we count beds. Several of these commenters indicated that the proposed
language was not supported within the construct of current regulations
and manual instructions. Specifically, commenters stated that the
current Sec. 412.105(b) and the manual instructions at section
2202.7.II of the Provider Reimbursement Manual-Part 2 (which defines
intensive care units) indicate that the only beds assigned to infants
that are to be counted are those in a neonatal intensive care unit.
Response: This change to the regulation language does not represent
a policy shift. While the manual section referenced by the commenters
does distinguish explicitly between neonatal intensive care units and a
regular well-baby unit, this distinction clearly is not exhaustive of
all of the possibilities for counting beds assigned to infants. In
fact, the same manual section goes on to indicate that subintensive
care type units, that is, those not meeting the criteria for intensive
care units, are considered as general routine care areas. Although this
discussion does not specifically mention neonatal subintensive care
units, we believe it is applicable for these units as well.
In addition, section 2815 of the Provider Reimbursement Manual-Part
2 has long included a definition of newborn inpatient days that
indicates that our policy for including inpatient days attributable to
sick infants is not restricted to the neonatal intensive care unit in
describing the days that are to be included in the completion of
Worksheet D-1 of the Provider Cost Reporting Form 2552.
``Newborn inpatient days are the days that an infant occupies a
newborn bed in the nursery. Include [as inpatient days] an infant
remaining in the hospital after the mother is discharged who does
not occupy a newborn bed in the nursery, an infant delivered outside
the hospital and later admitted to the hospital but not occupying a
newborn bed in the nursery, or an infant admitted or transferred out
of the nursery for an illness in inpatient days. Also, include an
infant born in and remaining in the hospital and occupying a newborn
bed in the nursery after the mother is discharged in newborn
inpatient days.''
Total inpatient days reported on that form exclude those days
applicable to newborn days. However, as clearly stated, days of care
for newborns outside the nursery are not considered to be newborn days.
We believe this decades-old manual instruction (in place since
1975) supports our position that all references to the exclusion of the
costs, days, or beds of nursery units refer only to the regular,
healthy baby nursery, and that the proposed language represents a
clarification rather than a shift in policy. We recognize that some of
these references may not have been as precise as they could have been
when they refer only to ``newborn beds'' or ``nursery beds,'' and this
imprecision occasionally has led to confusion both within and outside
the agency. However, where the instructions are specific, these terms
are sufficiently well-defined so that they can reasonably be
interpreted to refer only to a regular, healthy baby nursery.
Comment: Commenters suggested that past practice on the part of
Medicare's fiscal intermediaries with regard to counting these beds has
been inconsistent. That is, some intermediaries have allowed hospitals
to exclude only those days that a newborn is in the nursery, while
other intermediaries have allowed hospitals to exclude any day a
newborn is not in a certified-intensive care unit. Therefore, the
commenters believe it would be improper to begin to exclude them now.
Commenters questioned whether we would require intermediaries to adjust
unsettled past cost reports where these beds were excluded incorrectly.
It was suggested that doing so would constitute retroactive rulemaking.
Response: We recognize that there have been inconsistencies in the
application of this policy. We believe this has stemmed from the
absence of a specific provision in the instructions on the treatment of
subintensive/intermediate care beds, which this clarification should
remedy. In light of these previous inconsistencies, we expect that all
fiscal intermediaries that have not been correctly counting newborn
beds consistent with our policy, as clarified in this final rule, must
ensure that they revise their practices effective for cost reporting
periods beginning on or after October 1, 1995. We expect that those
fiscal
[[Page 45811]]
intermediaries that have been applying our policy appropriately will
continue that practice.
Comment: Several commenters questioned whether the costs of these
neonatal intermediate units were included in the calculation of the
prospective payment system standardized amounts. They stated that
unless we could demonstrate that the costs of these units were included
in the base year used to calculate the standardized amounts, there is
no basis for counting these beds when determining the resident-to-bed
ratio.
Response: As indicated above in a previous response to comment, our
policy to include the days, costs, and beds of these units predates the
prospective payment system, as well as the base year (1981) that was
used to set the standardized payment amounts. Consequently, we disagree
that we should be prohibited from clarifying this policy due to
apparent inconsistencies in its implementation.
Comment: Additional comments related specifically to how we
differentiate between healthy baby nursery beds and special care beds.
Commenters requested guidance on the status of those beds that are
occasionally used to treat less healthy newborns, but that are actually
located within a regular, healthy baby nursery. The commenters noted
that currently there is no clear definition in the regulations or
manual instructions that could be used to identify an intermediate
level of special care between a healthy, or regular, nursery and a
neonatal intensive care unit. Finally, one commenter suggested that we
consider licensure criteria for distinguishing between treatment units.
Response: Our bed counting policy essentially is determined by our
policies for including or excluding costs and days from the calculation
of Medicare costs on the cost report. These policies have consistently
followed the general principle that we do not attribute costs or days
to individual beds, but rather to units or departments. Therefore,
individual beds that are occasionally used to treat less healthy
infants, but that are located within a regular, healthy baby nursery,
continue to be treated as part of the unit in which they are located,
that is, as part of the healthy baby nursery. In considering whether
the beds used to treat sick infants constitute an intermediate neonatal
care unit, one must consider the cost center concept. Section 2302.8 of
the Provider Reimbursement Manual-Part 2 describes a cost center ``as
an organizational unit, generally a department or its subunit, having a
common functional purpose for which direct and indirect costs are
accumulated * * *.'' A regular, healthy baby nursery serves as a
custodian of healthy infants, whereas the intermediate or subintensive
neonatal care unit provides medical care to sick infants with very
different types of costs being incurred. Therefore, the appropriate
cost center with which to count the beds of an intermediate neonatal
care unit is the Adults and Pediatrics cost center.
While there is a great deal of variation in the types of units that
exist to care for infants, the Medicare fiscal intermediaries have been
required for some time to distinguish between nurseries and
intermediate units for cost reporting purposes.
Also, concerning the suggestion that we rely on licensure
designations to differentiate between units, we do not believe this
would be a feasible alternative due to variations in licensing criteria
across the country.
Comment: A representative of a group of Medicare's fiscal
intermediaries requested that we retain the language in Sec. 412.105(b)
specifically including neonatal intensive care beds in the bed count.
This commenter also pointed out that what we refer to as beds are often
referred to instead as bassinets, and that we should include both
phrases in the regulations. Finally, we were asked to clarify our
policy regarding the counting of beds or bassinets kept in the mother's
room, for example, in an alternative birthing center.
Response: We proposed deleting the reference to the inclusion of
neonatal intensive care unit beds from the regulations because we
believe that reference led to confusion concerning the beds excluded
from the hospital bed count. We continue to believe that the proposed
wording, combined with the policy clarification published in last
year's proposed and final rules, sufficiently defines our intentions as
to which beds are to be excluded. We agree that ``bassinets'' should be
included in the definition for determination of the number of beds.
Therefore, we are revising Sec. 412.105(b) accordingly.
With regard to beds placed in the mother's room rather than in a
healthy baby nursery, these beds or bassinets are not counted in
addition to the mother's bed already present in that room. We do not
believe, however, that it is necessary at this time to add a reference
to this issue in Sec. 412.105. Nevertheless, we will continue to
evaluate the policy implications of these arrangements in the future.
E. Disproportionate Share Adjustment (Section 412.106)
Section 1886(d)(5)(F) of the Act provides for additional payments
for hospitals that serve a disproportionate share of low income
patients. A hospital's disproportionate share adjustment is determined
by calculating two patient percentages (Medicare Part A/Supplemental
Security Income (SSI) covered days to total Medicare covered days, and
Medicaid but not Medicare Part A covered days to total inpatient
hospital days), adding them together, and comparing that total
percentage to the hospital's qualifying criteria. These calculations
are done by HCFA and the fiscal intermediary on a Federal fiscal year
basis. However, Sec. 412.106(b)(3) currently states that if a hospital
prefers that HCFA use its cost reporting period instead of the Federal
fiscal year, it must furnish to its intermediary, in machine-readable
format as prescribed by HCFA, data on its Medicare Part A patients for
its cost reporting period. These data take the place of the Federal
fiscal year MedPAR file data in obtaining the Medicare Part A/SSI
percentage. To ensure that the hospital is reporting actual Medicare
Part A patient days, we match the hospital's data to the HCFA MedPAR
data. In addition, we have required that a hospital accept the
recalculated percentage, even if it is lower than the Federal fiscal
year percentage.
In the last few years, this process has proven to be unsatisfactory
for several reasons. First, it is an administrative burden for the
hospital to prepare a tape that includes all its Medicare Part A
inpatient days. In addition, the hospital's tape data have seldom
exactly matched the MedPAR data. In that case, we can use only the data
that match. Finally, and probably often due to this second problem, the
resulting disproportionate patient percentages are invariably lower
than the original HCFA determined percentage. We proposed to alleviate
these problems by continuing to provide hospitals an alternative to
base their percentage on their cost reporting year, but relieving them
of the tape requirement.
Therefore, we proposed that if a hospital wishes a recalculation
based on its cost reporting period, the hospital would notify HCFA in
writing of its request that the Medicare Part A/SSI percentage be
calculated based on its own cost reporting year. The hospital would be
required to provide HCFA with its name, provider number, and cost
report period end date. HCFA, in turn, would use all MedPAR records for
that hospital from the requested time
[[Page 45812]]
period, as opposed to only those records that matched between the
MedPAR file and the hospital's tape data. This should provide hospitals
with more appropriate Medicare Part A/SSI percentages.
In addition, we proposed to process these requests on a quarterly
basis. Processing these individual requests for recalculation on a flow
basis has become an administrative burden on the available HCFA
computer processing resources. Therefore, we believe it is necessary to
batch these requests and run the MedPAR data on a set schedule. This
will be much more efficient and predictable.
Accordingly, we proposed to revise Sec. 412.106(b)(3) to provide
that HCFA will accept a hospital's written request, transmitted through
its fiscal intermediary, for a recalculation of its Medicare Part A/SSI
percentage based on its cost reporting period. The written request
should include the hospital's name, provider number, and cost report
period end date. We would perform a recalculation only once per
hospital per cost report period, and the resulting percentage becomes
the hospital's official Medicare Part A/SSI percentage for that period.
Comment: We received three comments, all of which supported our
proposal to use the MedPAR file data to recalculate Medicare Part A/SSI
percentages rather than continuing the requirement that hospitals
submit a tape of their Medicare Part A data based on their cost
reporting periods. However, one commenter was concerned that HCFA
provide an opportunity for hospitals to verify the data, and another
commenter requested that we add a provision that would hold a hospital
harmless if the Medicare Part A/SSI percentages decreased when this
alternative was requested. The latter commenter suggested that a
hospital affected by the ``hold harmless'' provision be subject to a
processing fee for the unused cost reporting period.
Response: Since there was no opposition to the proposed change, we
are adopting it in this final rule. Because the SSI data used in the
calculation are protected by the Privacy Act, we cannot provide an
opportunity for hospitals to verify these data. The data that the
Social Security Administration (SSA) uses to determine the Medicare
Part A/SSI percentage are not released to HCFA and therefore we are
unable to produce these data for hospitals. We must accept the data
that are officially collected and compiled by the SSA on a monthly
basis. The SSA is responsible for administering the SSI program and
keeps track, on a monthly basis, of those individuals who receive SSI
benefits.
Concerning the request for a ``hold harmless'' provision, it has
been our consistent policy that a hospital that requests a
recalculation of its Medicare Part A/SSI percentage based on its cost
reporting period must accept the result of that calculation in place of
the Federal fiscal year calculation. We believe that this policy
prevents hospitals from taking advantage of the opportunity to request
this procedure merely so that they can choose the higher percentage.
Ideally, a hospital will request a recalculation only if it has not
qualified for a disproportionate share adjustment but believes it is
close to qualifying.
F. Essential Access Community Hospitals (EACHs) and Rural Primary Care
Hospitals (RPCHs) (Sections 412.109, 413.70, 424.15, 485.603, 485.606,
485.614, 485.620, and 485.639, 485.645)
On May 26, 1993, we published a final rule to implement the EACH
program (58 FR 30630). The rule set forth the requirements for
designating certain hospitals as EACHs or RPCHs, the conditions that an
RPCH must meet to participate in Medicare, and the rules for Medicare
payment for services furnished by EACHs and RPCHs. The final rule
implemented section 1820 of the Act, as added by sections 6003(g) and
6116(b)(2) of Public Law 101-239 and revised by section 4008(d) of
Public Law 101-508. The amendments were intended to promote
regionalization of rural health services in grant States, improve
access to hospital and other health services for rural residents, and
enhance the provision of emergency and other transportation services
related to health care.
Section 102 of the Social Security Act Amendments of 1994, Public
Law 103-432 (SSAA '94), made significant changes in the provisions of
the Medicare law governing the EACH/RPCH program. To implement these
changes, we proposed to revise the regulations as follows:
1. Designation of Urban Hospitals as EACHs (Section 412.109)
Section 1820(e) of the Act previously provided that only rural
facilities could be designated as EACHs, and all EACHs were to be paid
as sole community hospitals (SCHs). Section 102(b)(1) of SSAA '94
revised section 1820(e) of the Act to allow hospitals located in urban
areas to be designated as EACHs if they have entered into network
agreements with RPCHs and meet other applicable requirements. As EACHs,
these urban facilities may qualify for EACH grants. However, they are
not eligible for the special payment methodology afforded rural EACHs.
For payment purposes, rural EACHs are treated as sole community
hospitals (SCH). Section 1886(d)(5)(D) of the Act was amended to
clarify that only hospitals designated as EACHs and located in rural
areas are treated as SCHs for payment purposes. Urban EACHs will
therefore continue to be paid at the applicable urban rates.
To implement this provision, we proposed to revise Sec. 412.109 to
remove the current rural location requirement for EACH designation, and
to provide that payment as an SCH is limited to EACHs in rural areas.
As explained below, we also proposed to revise that section to allow a
State that has received an EACH grant to designate an otherwise
qualified hospital in an adjoining State as an EACH.
In conjunction with this change, we proposed to make a technical
correction to a reference in Sec. 485.603.
We received no comments in response to these proposals, and are,
therefore, adopting them as proposed.
2. Designation of EACHs and RPCHs in States Adjoining Grant States
(Sections 412.109 and 485.606)
Section 1820(c) of the Act previously provided that hospitals could
be designated as EACHs only if they were located in States receiving
EACH grants. Section 1820(i)(2) of the Act did authorize designation of
RPCHs outside the grant States; however, the number of facilities
designated under this authority was limited to 15 nationally, and only
the Secretary, not individual grant States, could make the designation.
Section 1820(i)(2) of the Act further requires the Secretary, in making
the special designations, to give preference to facilities that have
entered into network agreements with other facilities in grant States,
thus indicating a strong preference for designation of RPCHs in States
adjoining grant States. Section 102(b)(2) of SSAA '94 amended section
1820 of the Act to authorize the individual grant States to make
designations of both EACHs and RPCHs in adjoining States, if the
facilities so designated are otherwise qualified and have entered into
network agreements with EACHs or RPCHs in the grant State. The
legislation does not limit the number of such designations. To
implement this change, we proposed to revise Secs. 412.109 and 485.606
to permit these new designations of EACHs and RPCHs by adjacent States
that have received grants. We proposed that hospitals designated in
this way will be required to meet other applicable requirements, and we
plan to make such designations subject to review and
[[Page 45813]]
approval by the HCFA regional offices on the same basis as designations
of facilities in the grant State. That is, the designation will not
result in recognition of a facility as an EACH or RPCH for Medicare or
Medicaid purposes until HCFA has determined that the requirements are
met.
We received no comments in response to these proposals, and are,
therefore, adopting them as proposed.
3. Designation of EACHs and RPCHs by States That Have Received Grants
(Sections 412.109 and 485.606)
Section 1820(a)(1) of the Act establishes a program under which the
Secretary makes grants available to not more than seven States to carry
out certain activities, including designating hospitals or facilities
in the State as either an EACH or an RPCH. Because there is no
assurance that funding of this grant program will continue, some or all
of the seven States may not receive grants under section 1820(a)(1) of
the Act in the future. Since States may not continue to ``receive''
grants, we proposed to revise the regulations pertaining to EACHs and
RPCHs by replacing references to ``States receiving grants'' with
references to ``States that have received grants'' or ``a State that
has received a grant,'' as appropriate. Specifically, we proposed to
revise the designation of EACHs and RPCHs under current Sec. 412.109(b)
and (c), and Sec. 485.606, respectively, to include these revised
references. Should the grant program expire, these proposed revisions
would prevent any uncertainty that may arise as to the status of
designations made by States that have received grants.
We received no comments in response to these proposals, and are,
therefore, adopting them as proposed.
4. Change in Payment for Outpatient RPCH Services (Section 413.70)
Previously, section 1834(g) of the Act provided that payments to
RPCHs for outpatient services under the cost-based facility fee plus
professional charges method were to be determined under section
1833(a)(2)(B) of the Act. That section states that payment is to be
made at the lesser of the reasonable cost of the services or the
customary charges for the services. (This is commonly referred to as
``LCC,'' that is, the lesser of costs or charges.) Current regulations
at Sec. 413.70(b)(2)(i) require that payment to RPCHs under the cost-
based facility fee plus professional services be made in accordance
with the LCC principle. This principle is set forth under Sec. 413.13.
Section 102(e)(2) of SSAA '94 amended section 1834(g)(1) of the Act
to provide that payment for outpatient RPCH services under the cost-
based facility fee plus professional charges method are to be
determined without regard to the amount of the customary charge. To
implement this change, we proposed to amend Sec. 413.70(b)(2)(i) to
provide that for payment for RPCH outpatient services made under the
cost-based RPCH payment plus professional services method, the
principle of the lesser of costs or charges does not apply.
We received no comments in response to these proposals, and are,
therefore, adopting them as proposed.
5. Content of Required Physician Certification (Section 424.15)
Section 1814(a)(8) of the Act previously provided that Medicare
Part A could pay for inpatient RPCH services only if a physician
certified that the services were required to be furnished immediately
on a temporary, inpatient basis. Section 102(a)(3) of SSAA '94 deleted
this requirement and provided instead that Medicare Part A will pay for
the inpatient RPCH services only if a physician certifies that the
individual may reasonably be expected to be discharged or transferred
to a hospital within 72 hours after admission to the RPCH. We proposed
to revise Sec. 424.15 to reflect the new requirement.
We received no comments in response to this proposal, and are,
therefore, adopting it as proposed.
6. Length-of-Stay Requirement for RPCHs (Sections 485.614 and 485.620)
Section 1820(f)(1)(F) of the Act previously allowed all RPCHs to
keep inpatients no longer than 72 hours before discharging them or
transferring them to a full-service hospital, unless discharge or
transfer was precluded by inclement weather or other emergency
conditions. Section 102(a)(1) of SSAA '94 removed the per-stay
limitation and substituted for it a provision under which the Secretary
may terminate the designation of a facility as an RPCH if the Secretary
finds that the average length of stay in the preceding year exceeded 72
hours. The provision further states that periods of stay in excess of
72 hours that occurred because discharge or transfer were precluded by
inclement weather or other emergency conditions are not to be taken
into account in computing a facility's average length of stay for this
purpose.
To implement this change, we proposed to revise Secs. 485.614 and
485.620 to delete the current per-stay limitation, and to replace it
with a requirement for a facility-wide average length of stay that does
not exceed 72 hours, excluding parts of stays in excess of 72 hours
that occurred because of inclement weather or other emergencies. In the
case of a currently participating RPCH, termination of the RPCH
designation can be made effective only by ending Medicare
participation. Therefore, we proposed to revise Sec. 489.53 to
authorize termination of the provider agreement of an RPCH if HCFA
finds that it does not maintain the required average length of stay.
We received no comments in response to these proposals, and are,
therefore, adopting them as proposed.
7. Restriction on Scope of Surgical Services to RPCH Inpatients
(Section 485.614 and new Section 485.639)
Before the Social Security Act Amendments of 1994 were enacted,
there were no explicit restrictions on the type or extent of surgical
activity that could be performed in a RPCH. These facilities and their
practitioners were, however, required to conform to applicable State
licensure and scope of practice laws. Section 102(a)(1) of SSAA '94
added an explicit restriction on surgical activity by RPCHs.
Specifically, a State may not designate a facility as an RPCH if the
facility provides inpatient hospital services consisting of surgery or
any other service requiring the use of general anesthesia (other than
surgical procedures specified by the Secretary under section
1833(i)(1)(A) of the Act), unless the attending physician certifies
that the risk associated with transferring the patient to a hospital
for such services outweighs the benefits of transferring the patient to
a hospital for such services. The procedures specified by the Secretary
under section 1833(i)(1)(A) of the Act are those that are performed on
an inpatient basis in a hospital but which also can be performed safely
on an ambulatory basis in an ambulatory surgical center (ASC) or in a
hospital outpatient department. Implementing regulations for section
1833(i)(1)(A) of the Act are set forth at Sec. 416.65. HCFA also
publishes a list of covered surgical procedures in Addendum A to Part 3
of the Medicare Carriers Manual.
To implement this change, we proposed to revise Sec. 485.614 to
reflect the new statutory provision. We note that the law still does
not limit the scope of surgical procedures that can be performed for
RPCH outpatients, and that both hospitals and ASCs, the other two
facilities in which ASC procedures can be performed, are subject to
specific health and safety rules on administration of anesthesia and
performance of the surgery. To ensure
[[Page 45814]]
adequate health and safety protection for RPCH patients and to apply
Medicare standards uniformly to ASC-type procedures, we also proposed
to add, at Sec. 485.639, a new RPCH condition of participation for
surgical services. We note that the new condition would apply the same
rules in the RPCH as now apply in an ASC, and that it would apply to
both inpatient and outpatient surgery. Given the similarities between
RPCHs and ASCs and the fact that identical procedures can be performed
in each, we believe uniform health and safety rules are needed.
We received no comments in response to these proposals, and are,
therefore, adopting them as proposed.
G. New Provision Subject to Public Comment To Allow Provision of
Skilled Nursing Facility (SNF) Services by RPCHs (Section 485.645)
When we issued regulations (Sec. 485.645) to implement the RPCH
provisions in section 1820 of the Social Security Act (see 58 FR 30630,
May 26, 1993), we made a number of interpretations or elaborations to
deal with situations that were not explicitly dealt with by the
statute. Among them were these two policies: an RPCH with a swing-bed
agreement could have no more than 12 beds for the use of inpatients
(Sec. 485.645(a)(1)); and all 12 beds could ``swing,'' that is, could
be used to furnish both RPCH-level (acute) care as well as a SNF-level
of care, as the individual patient required.
Congress changed those policies when it enacted section 102 of the
Social Security Act Amendments of 1994. First, Congress rejected the
12-bed limit. Section 102(c) of SSAA '94 amended section 1820(f)(3) of
the Act to provide instead that in the case of a hospital with a swing-
bed agreement under section 1883 of the Act that applies to become a
RPCH, the number of beds that the RPCH can use for furnishing SNF-level
services may not exceed the total number of beds that were licensed
beds at the time the hospital applies to become an RPCH, minus the
number of inpatient RPCH beds. (Thus, the number of beds an RPCH may
have for SNF-level care could be more or fewer than 12.)
Second, amended section 1820(f)(3) now refers only to ``the number
of beds used [by the RPCH] for the furnishing of such [SNF-level]
services.'' This language does not also refer to using those beds to
furnish such SNF-level services along with RPCH-level services.
Third, Congress provided that the six RPCH-level beds could not
also be used to furnish SNF-level services. Specifically, section
1820(f)(3) now explicitly states that the number of beds an RPCH can
use for furnishing SNF-level services must be calculated ``minus the
number of inpatient beds used for providing inpatient [RPCH-level
(acute)] care.'' The latter indicates that Congress did not anticipate
the six RPCH-level beds would also be used to furnish SNF-level
services.
Further, in section 102(g) of SSAA '94, Congress enacted a number
of conforming technical amendments to make explicit that various
provisions applicable to hospitals should also be applicable to RPCHs.
In doing so, however, it conspicuously failed similarly to amend
section 1883 of the Act, ``Hospital Providers of Extended Care
Services.'' That is the provision that permits hospitals to have swing
beds. Not amending section 1883 is consistent with our conclusion that
Congress intended to permit certain RPCHs to have a limited number of
beds for furnishing SNF-level services, but not dual-purpose swing
beds.
We believe these Congressional policy changes are based on sound
policy reasons. First, the six-bed limit for inpatient RPCH-level care
is reconfirmed. That was a major element in Congress' decision in the
original legislation to encourage small rural hospitals to convert from
being full service hospitals to become limited purpose facilities.
Second, all RPCHs are now treated the same with respect to the limit on
the number of RPCH-level inpatient beds. Third, hospitals that had
swing-bed agreements can continue to furnish SNF-level services when
they become RPCHs, without interfering with the other RPCH provisions.
As noted, although section 1820 of the Act, as amended by section
102(c) of SSAA '94, does not provide for an RPCH to continue to use its
beds interchangeably to provide RPCH-level and SNF-level services, it
does provide for an existing swing-bed hospital to be designated as an
RPCH (with up to 6 beds used exclusively for inpatient RPCH-level
services) and retain its remaining beds to be used exclusively for SNF-
level services. Payment for the RPCH-level care provided by the RPCH
would be determined in accordance with 42 CFR 413.70(a). In
establishing the payment methodology for the SNF-level services
provided by the RPCH, we have concluded that since SNF-level services
provided by the hospital had previously been paid under the methodology
specified for swing-bed hospitals at 42 CFR 413.114, it is consistent
with sound application of these reasonable cost principles to continue
to pay for those services under that methodology.
In this final rule, we are revising Sec. 485.645 accordingly to set
forth the eligibility and payment policies described above. We
recognize that there may be concerns about the implementation of this
provision with respect to facilities originally designated as RPCHs
before the effective date of the new amendments, and are providing a
60-day public comment period on the Sec. 485.645 changes only. (As
discussed above in section IV.F of this preamble, the other changes
needed to implement section 102 of SSAA '94 were included in the
proposed rule and, in the absence of public comment, are being adopted
without change.) Because we did not include these changes in the
proposed rule, we considered delaying the implementation of section
102(c) further in order to allow time for full notice-and-comment
rulemaking. However, the statutory effective date is October 31, 1994,
and several facilities have indicated an interest in being designated
as RPCHs under the new provisions. Moreover, we believe these changes
may be necessary to assure access to SNF-level care in rural areas. In
this context, we believe it would be contrary to the public interest to
further delay implementation by the amount of time needed for proposed
rulemaking. We will consider carefully all comments we receive, and
make any further changes needed as the result of them in a final rule.
We also are considering whether other, more stringent health and safety
rules may be needed in light of the new provisions, and may propose
further changes in this area in the future.
H. Rebasing the Hospital Market Basket
Our practice has been to update or rebase the market basket about
every 5 years. Occasionally, we have adjusted this timing to coincide
with the Department of Commerce, Bureau of Economic Analysis' schedule
for updating the interindustry model of the United States (U.S.)
economy, which is released every 5 to 7 years. The interindustry model
includes detailed cost analyses of the entire U.S. economy including
the hospital industry. In developing the current market basket,
effective beginning October 1, 1990, we used 1987 hospital data from
the American Hospital Association's (AHA's) 1988 Annual Survey for six
major expense categories (wages and salaries, employee benefits,
professional fees, depreciation, interest, and a residual ``all other''
category). We used AHA's Hospital Administrative Services (HAS) data
from 1987 to derive the weights for professional liability
[[Page 45815]]
insurance, food, and pharmaceutical products. Weights for most of the
remaining subcategories were derived from Department of Commerce,
Bureau of Economic Analysis data trended forward to 1987. For a
detailed description of the rebased market basket effective October 1,
1990, see the September 1, 1990 final rule (55 FR 36043).
Although it has been 5 years since the most recent rebasing of the
market basket, in the proposed rule we announced our intention to
schedule market basket rebasing for FY 1997. We believe that a 1-year
delay in the usual schedule is advantageous for the following reasons.
First, it provides an opportunity to review and incorporate two
important new data sources that are not available at this time. The
first of these, the FY 1992 and 1993 Medicare cost report data, contain
more detailed data on labor-related and capital-related costs. We are
planning on replacing the AHA Annual Survey data with Medicare cost
report data for the main operating and capital cost weights. In the
next several months, we are planning to compare and analyze the impact
of this change to ensure the validity and consistency of the rebased
market baskets for operating and capital costs. We believe that using
the Medicare data would be an improvement since these data are reported
directly to HCFA by Medicare participating hospitals, are readily
available to us in a timely manner, and would free us from relying on
data that is collected by outside organizations.
The second new data source we anticipate obtaining and analyzing is
the 1992 Bureau of the Census' Assets and Expenditures Survey, which
will be available later this year. The Census survey will provide much
more detailed operating and capital cost data, and we anticipate that
we will be able to use this survey to allocate the main cost category
weights into more detailed subcategory weights for both operating and
capital costs.
In addition to using the market basket to update the payment rates,
we also use the percentages of the labor-related items (that is, wages
and salaries, employee benefits, professional fees, business services,
computer and data processing, blood services, postage, and all other
labor-intensive services) to determine the labor-related portion of the
standardized amounts. The labor-related portion of the standardized
amounts is that portion that is subject to adjustment by the hospital
wage index. In order to estimate if postponement of the market basket
rebasing would adversely affect hospital payments due to a potential
change in the labor-related portion of the payment amounts, we
conducted an analysis using the 1987 index rebasing methodology (with
1992 equivalents of the data sources used in 1987). This analysis
indicates only a minor difference in the 1987 and 1992 AHA cost shares
for compensation costs, which are the major portion of labor-related
costs. Therefore, we believe that delaying the market basket rebasing
until FY 1997 will not disadvantage hospitals and will allow us to use
more detailed and current data. We did not receive any comments
opposing this plan, and we intend to rebase the market basket as a part
of our FY 1997 changes to the prospective payment system.
V. Changes and Clarifications to the Prospective Payment System for
Capital-Related Costs
A. Update Framework for Prospective Payment System for Inpatient
Hospital Capital-Related Costs and Possible Revisions to the Federal
Rate (Section 412.308(c)(1)(ii))
1. Introduction
For FY 1992 through FY 1995, Sec. 412.308(c)(1) provides that the
update for the capital prospective payment rates (Federal rate and
hospital-specific rate) will be based on a 2-year moving average of
actual increases in Medicare inpatient capital costs per discharge. The
regulations provide that, beginning in FY 1996, HCFA will determine the
update in the capital prospective payment rates based on an analytical
framework that will take into account (1) changes in the price of
capital (which we will incorporate into a capital input price index),
and (2) appropriate changes in capital requirements resulting from
development of new technologies and other factors (such as existing
hospital capacity and utilization). The objective of the capital update
framework is to determine a rate of increase in aggregate capital
prospective payments that, along with a rate of increase in DRG
operating payments, ensures a flow of capital and operating services
for efficient and effective care for Medicare patients.
In the June 2, 1995 proposed rule we presented a formal proposal
for an update framework for the prospective payment system for hospital
inpatient capital-related costs (60 FR 29227). The proposal followed a
series of preliminary models of an update framework in our FY 1992, FY
1993, FY 1994, and FY 1995 rulemaking documents. We received numerous
public comments on the proposed framework, and we present our responses
to those comments below.
The proposed update framework included a capital input price index
(CIPI) that parallels the operating input price index. The CIPI
measures the pure price changes associated with changes in capital-
related costs (prices x ``quantities''). The composition of capital-
related costs is maintained at base-year FY 1987 proportions in the
CIPI. As such, the composition of capital reflects the underlying
capital acquisition process. We employ FY 1987 as the base year for
this preliminary CIPI for consistency with the operating input price
index. We will periodically update both the operating and the capital
input price indexes to reflect the changing composition of inputs for
capital and operating costs.
The proposed capital update framework, like the operating update
framework, incorporated several policy adjustments in addition to the
CIPI. We proposed to adjust the CIPI rate of increase for case-mix
index-related changes, for intensity, and for error in previous CIPI
forecasts. We also discussed a possible adjustment for the efficient
and cost-effective use of capital (such as movable equipment, buildings
and fixed equipment) in the hospital industry.
In the proposed framework, we attempted to maximize consistency
with the current operating framework, in order to facilitate the
eventual development of a single prospective payment system update
framework. We also attempted to promote the goals that motivated the
adoption of the capital prospective payment system, especially the
goals of promoting more effective and efficient utilization of capital
resources in the hospital industry and establishing incentives for
hospitals to make cost-effective decisions regarding acquisition of new
capital resources.
We invited comments and recommendations on all aspects of the
proposed framework. We expressed interest in suggestions regarding the
CIPI, the proposed policy adjustment factors, and alternative
methodologies for deriving the factors. We were especially interested
in comments on a possible efficiency adjustment.
2. ProPAC Recommendation for Updating the Capital Prospective Payment
System Federal Rate
In its March 1, 1995 report to Congress, ProPAC recommended the use
of an update framework that includes a capital market basket component.
The ProPAC market basket measures 1-year changes in the purchase prices
of a fixed basket of capital goods purchased by
[[Page 45816]]
hospitals. The ProPAC framework also includes several policy adjustment
factors. A forecast error correction factor adjusts payment rates so
that the effects of past errors are not perpetuated. A financing policy
adjustment accounts for the effects of substantial deviations from
long-term trends in interest rates on hospital capital costs. The
ProPAC capital update framework also includes adjustments for
scientific and technological advances, productivity, and case-mix
change similar to those employed in the ProPAC operating update
framework. ProPAC also recommends the adoption of a single update
framework for adjusting operating and capital prospective payment rates
when the transition to full Federal rate capital payments is complete.
ProPAC believes that using a simplified approach comparing annual price
changes in capital would facilitate the development of such a unified
framework.
Our long-term goal is to develop a single prospective payment
system update framework. We will soon begin to study development of a
unified framework. In the meantime, we will continue to maintain as
much consistency as possible with the current operating framework in
order to facilitate the eventual development of a unified framework.
The ProPAC and HCFA update frameworks share certain goals. The goal
of each framework is to provide a rate of increase in capital
prospective payments that, along with the rate of increase in operating
prospective payments, will ensure a flow of capital and operating
resources that will allow for efficient and effective care for Medicare
patients. Both frameworks are designed to provide increases for the
purchase of quality-enhancing new technologies. Both frameworks provide
for case-mix adjustments to remove the effects of upcoding and to
adjust for changes in within-DRG severity. Both frameworks also seek to
encourage efficient capital spending behavior. Although the frameworks
adopt different methodologies for promoting some of these goals, they
are compatible to the degree that they share these goals.
The major difference between the ProPAC and HCFA frameworks
concerns the purpose and structure of the capital input price index, or
market basket. ProPAC's framework is based on the premise that capital
prospective payments are only for future capital purchases and should
not reflect the vintage nature of capital. Thus, ProPAC's proposed
capital market basket reflects the projected increase in the purchase
price of capital goods from one year to the next. HCFA's framework is
based on the premise that capital prospective payments are for
hospitals' capital-related expenses, which include the expenses related
to future capital-related purchases. That is, HCFA's framework
addresses the input price component of expenses associated with
hospitals' given stock of capital in a particular fiscal year; ProPAC's
framework ignores hospitals' present stock of capital and focuses on
changes in input prices associated with capital purchases that
hospitals will make in a particular fiscal year.
The HCFA CIPI projects the price changes associated with the
accounting or vintage costs of capital assets. The HCFA CIPI is based
on a definition of capital-related expenses and associated capital-
related prices derived from accounting practice (including required
HCFA prospective payment system accounting practice) and consistent
with economic theory. HCFA believes that the concept of capital-related
prices incorporated into the HCFA CIPI is more appropriate than the
concept incorporated into the ProPAC market basket because the
consumption of capital is not just what is purchased in one year. The
consumption of capital has a time-dimension: Capital is not used up
immediately but rather over time. This feature of capital is reflected
in the accounting definition of capital cost, and it should be
reflected as well in the concept of capital prices in the CIPI. The
transition from reasonable cost reimbursement to payment under a
prospective system does not cancel the applicability of general
accounting practice or the HCFA accounting practice derived from it.
Thus the concepts of capital-related expenses and capital-related
prices continue to be appropriate. Furthermore, the base capital rates
were computed on the basis of accounting costs. HCFA believes that it
is more consistent to update those rates on the basis of the changes in
prices associated with those costs rather than on the basis of changes
in current year purchase prices alone.
The HCFA CIPI captures the vintage feature of capital price by
using a vintage average approach, that is, weighted averages of
purchase prices and interest rates up to and including the current
year. The use of vintage averages as the measure of price changes
tracks the flow of consumption of capital. The vintage approach better
reflects what hospital cash-flow needs are as new assets are brought
on, since hospitals still bear the costs of older assets as the new
assets are brought on.
HCFA believes that the CIPI appropriately reflects the prices
associated with past and current period purchases of capital. Under the
HCFA approach, the price change associated with the capital costs for
any year is a weighted average of the prices associated with
depreciation, interest and other capital costs for that year. The
prices associated with the depreciation costs during the year are an
average of the prorated purchase prices for the assets in use during
that year (25 years for buildings and fixed equipment, 10 years for
movable equipment, including current year purchases). The prices
associated with the interest costs during the year are an average of
the interest rates on debt instruments in effect during that year (22
years, including debt instruments that are new in the current year).
Capital-related costs for insurance have an annual time dimension, and
therefore the prices associated with those expenses are current year
prices only.
In addition to the disagreement over whether the CIPI should
reflect the vintage nature of capital, HCFA and ProPAC also disagree
over the treatment of interest. ProPAC proposes to account for interest
rate changes through a separate financing policy adjustment that would
account for significant changes in long-term interest rates. This
adjustment would increase the update in case of significant long-term
interest rate increases, and decrease the update in cases of
significant interest rate decreases. (ProPAC has not identified the
threshold that constitutes ``significant'' interest rate changes.)
HCFA believes that there must be an interest rate component in a
capital input price index. Sound accounting practice includes interest,
along with depreciation, as a component of capital cost. The interest
and depreciation components of capital cost track the flow of
consumption of capital inputs. Price is a component factor of cost
(that is, cost is the product of price and quantity), and capital cost
has both depreciation and interest components. There must therefore be
an interest component of capital price just as there is an interest
component of capital cost.
Furthermore, ProPAC's treatment of interest assumes that only
current year interest rate changes need to be measured to capture the
relevant price effects of interest rate changes. HCFA believes that the
price aspects of interest costs, like the price aspects of depreciation
costs, have a time dimension that must be captured in the CIPI. Whether
the current year interest rate reflects a net lower price of financing
to the hospital depends not on comparison of the current year's
interest rate to the previous year's interest rate,
[[Page 45817]]
but on the effect of the current year interest rate on all the
hospital's debt instruments. For example, assume that the previous
year's interest rate was 8 percent, and the current year's interest
rate is 5 percent. However, as the hospital enters new financing
arrangements at the current rate of 5 percent, it retires debt
instruments from 20 years earlier that bore an interest rate of 3
percent. The price effect of the current year's interest rate is thus
higher, not lower, as new debt instruments at 5 percent replace old
debt instruments at 3 percent. HCFA believes it to be a great advantage
of its CIPI that it directly tracks price effects such as these.
Finally, the pure price aspects of interest costs (that is, the
interest rate and the purchase price that is represented in the amount
of loan principal) are typically beyond the control of the hospital
industry. To be sure, the actual decision to purchase capital assets or
acquire debt is a ``quantity'' decision and typically is discretionary
for a particular span of time. However, in measuring the actual
expected price per unit of real capital, independently of any
evaluation of the propriety of any actual purchase decisions, it is
essential to recognize that the industry has some control over the
amount of capital it purchases but little or no control over the price
it pays for capital. Thus, the pure price aspect of interest cost
changes must be incorporated into the CIPI. Otherwise, the CIPI will
not accurately reflect the prices faced by hospitals who must borrow to
finance necessary capital acquisitions. Limitations on the quantity of
capital are appropriately implemented through policy adjustment
factors. The ProPAC approach artificially eliminates pure price changes
related to interest costs from the CIPI and incorporates them into a
discretionary adjustment factor. The HCFA CIPI retains all price
components of increases in interest costs as one measure of inflation
in capital-related expenses. It thereby keeps price and quantity
aspects distinct, allowing separate analysis of each factor of
increases in capital expenses.
We do not agree with the ProPAC that the approach of comparing
annual price changes in capital is more conducive to a single update
factor. We believe that price changes in current hospital capital
expenses are analogous to price changes in current hospital operating
expenses. The HCFA CIPI measures the price change in capital expenses,
and is, therefore, the appropriate analog to the input price index used
to update operating payments under prospective payment. We provide
further comments on particular ProPAC recommendations in section V.A.3
of this preamble.
3. Measurement of Capital Input Price Increases
a. Introduction. HCFA discussed a capital input price index as one
component in developing future update factors for the Federal rate in
the September 1, 1992 Federal Register (57 FR 40016). We have presented
revised versions of the capital input price index in the May 26, 1993
(58 FR 30448), September 1, 1993 (58 FR 46490), May 27, 1994 (59 FR
27876), and September 1, 1994 (59 FR 45517) issues of the Federal
Register.
In the June 2, 1995 proposed rule (60 FR 29229), we formally
presented a capital input price index for public comments prior to
adoption of this final rule. The proposed CIPI parallels the operating
input price index. Both the CIPI and the operating input price index
are designed to measure input price changes for hospitals' current year
expenses, that is, to separate pure price changes from quantity and
expenditure changes. The operating sector input price index measures
input price changes for operating-related expenses. The capital input
price index measures input price changes for capital-related expenses,
which include depreciation, interest, and other expenses (such as
insurance related to capital goods).
b. HCFA Capital Input Price Index Methodology. The CIPI is based on
the following assumptions:
The Federal rate is based on the concept of capital-
related expenses of capital assets used for patient care in the fiscal
year and, therefore, any change in the Federal rate should take into
account expected changes in the input price aspects of capital-related
expenses.
Capital-related expenses are defined as the sum of
depreciation expense, capital-related interest costs, and other
capital-related costs, including insurance and leases.
The input prices related to capital-related expenses are
typically beyond the control of the hospital industry (that is, the
hospital is a price-taker, not a price-setter).
These assumptions lead directly to a definition of a CIPI that
takes into account the price aspects of changes in depreciation
expense, interest costs, and other capital-related costs. Thus, the
CIPI includes three categories of capital-related expenses:
depreciation, interest, and other capital-related costs (such as
insurance). Further, the assumptions lead directly to input prices for
depreciation and interest costs that, unlike operating costs, have a
time dimension that must be captured in the CIPI.
Comment: A commenter suggested that the HCFA CIPI is flawed because
it relies excessively on assumptions that could cause the update to be
more likely to overstate or understate the true changes in prices than
an input price index measuring year-to-year changes.
Response: We believe that the HCFA CIPI appropriately and
accurately reflects the ``pure'' price change in capital expenses for
the current year as well as other years or vintages. The CIPI was
developed based on accepted accounting definitions of capital expenses
and conceptually sound methodologies using appropriate data. We have
continually improved the index by using more relevant data, as well as
implementing comments received on three prior rulemaking documents. The
assumptions we have made regarding price proxies, base year weights,
and expected lives have been explained thoroughly and refined in the
prospective payment system rulemaking documents for the last three
fiscal years. These assumptions are based on accepted accounting,
economic, and financial reasoning. Thus, we believe that those
assumptions lead to valid results.
Current depreciation costs represent the summed depreciation for
all purchases of capital assets that are still depreciable in the
current period. The input prices associated with these depreciation
expenses are the purchase prices attached to all past and current
capital purchases for capital still depreciable in the current period.
A weighted average of these purchase prices thus represents the input
price associated with depreciation expenses in the current period.
Thus, the depreciation input price for the current period measures
price aspects of current depreciation expenses for capital, just as the
operating input price index for the current period measures price
aspects of current operating expenses for labor and non-capital goods
and services. The depreciation input price appropriately differs from
the operating input price in that the depreciation input price is a
vintage-weighted composite of all past capital purchase prices, while
the operating index input price measures purchase prices for current
periods only.
Comment: Two commenters contended that HCFA's vintage-weighting
approach will not provide sufficient updates to allow for replacement
of capital. They conclude that the CIPI should therefore include only
increases in current year purchase
[[Page 45818]]
prices. One of the commenters submitted a detailed technical analysis
concluding that the HCFA CIPI will allow HCFA to match payment
increases for depreciation and interest with increases in depreciation
and interest expenses, but will not allow HCFA to match increases in
replacement costs of assets. This commenter questioned whether a focus
solely on depreciation and interest is a necessary requirement for
prospective payment for capital. The other commenter implied that the
non-vintage approach will provide sufficient capital reimbursement to
replace needed capital assets, while the HCFA CIPI looks at the current
capital stock that has already been acquired and paid for.
Response: We concur with the comment that the HCFA CIPI captures
increases in the price component of depreciation expenses, and, under
reasonable assumption, will match price increases in interest rates.
The issue of providing for replacement of capital assets is a difficult
one. We agree with the commenters that an adequate update framework
should be able to provide updates to payment rates sufficient to fund
replacement of capital assets, where it is appropriate to do so. We do
not necessarily believe, however, that it is appropriate for the
Medicare program to support full replacement of assets where excess
capital capacity exists.
As in the case of other issues regarding the update framework, the
issue of replacement costs has both price and quantity aspects. Full
replacement cost involves increases reflecting both price and quantity
sufficient to replace existing assets. In this section, we discuss the
replacement issue from the price aspect: that is, whether the vintage-
weighting approach in the HCFA CIPI can provide, where appropriate,
updates sufficient to fund full replacement. In this analysis, we make
the assumption that it is appropriate to set the policy adjustments
within the update framework at levels to provide for the quantities
necessary to provide full replacement. In section V.A. below, we
discuss our continuing analysis of capital cost increases during the
period just prior to the implementation of prospective payment for
capital. During that period, the Medicare program paid for operating
costs on a prospective basis, but hospitals continued to receive cost-
based payment for capital. That analysis suggests that an excess
capacity of capital assets over efficient levels may exist. If that is
the case, then adjustments to provide for less than full replacement of
capital assets may be appropriate since underused capacity implies
inefficient use of social resources.
We do not agree with the suggestion that the HCFA CIPI cannot
adequately provide for replacement of assets. The HCFA CIPI provides
increases in the price component of replacement costs for new capital
by adequately reflecting price increases in capital expenses.
Medicare's payment for capital has changed from retrospective cost-
based reimbursement to prospective payment for an efficient level of
capital. However, the concept of paying for capital expenses remains
the same under capital prospective payment, just as the concept of
paying for operating expenses has not changed. That is, under
prospective payment, hospitals will be paid for an efficient level of
operating and capital expenses.
The HCFA CIPI provides a conceptually sound measure of price
changes associated with the capital expenses incurred by hospitals. The
level of capital expenses incurred by a hospital in a given year is not
a function merely of the annual percent change in the new capital
purchase prices, but rather of the purchase prices and interest rates
associated with all capital assets that are still in use for patient
care and that are not yet fully depreciated. Because of the vintage
nature of the CIPI, the percent change in the CIPI can appropriately be
above, below, or equal to the annual percent change in capital purchase
prices in any given year.
Analysis by the HCFA Office of the Actuary suggests that the CIPI
should provide updates adequate to finance replacement of capital under
reasonable assumptions about prudent hospital financial management.
Industry sources and Medicare cost report data indicate that capital is
not typically paid for in full when it is acquired. Rather, debt
funding is the major form of capital financing used by hospitals.
Actual cash outlays for capital thus consist primarily of payments for
principal and interest on loans. The interest component inherent in the
capital prospective payment system should cover interest costs for an
efficient hospital.
The issue concerning replacement of assets is thus whether the
depreciation component implicit in the prospective capital payment can,
assuming an allowance for replacement of the full quantity of assets,
cover the principal costs of debt for an efficient hospital while
allowing accumulation of a reserve adequate to provide the necessary
down payment for future capital purchases. In the early years of debt
repayment, principal payments are relatively small. During that period,
the portion of the rate payment related to depreciation in excess of
principal costs of debt can be accumulated in a sinking fund. Sound
financial management suggests that payments for capital expenses
(depreciation and interest) that are in excess of the hospital's actual
capital cash outlays (principal and interest) be accumulated and
invested to provide for adequate replacement of assets. In other words,
prudent hospitals would invest the sinking fund to earn interest. Based
on examination of historical relationships and projected trends, we
believe that accumulation of the sinking fund over the life of the
asset will, on average, provide an adequate amount for asset
replacement.
Current interest expenses represent the total interest costs for
all still-active past debt instruments associated with past and current
purchases of all capital assets currently used for patient care. The
input prices associated with these interest expenses are the interest
rates associated with all past debt instruments that are still active
in the current period. A weighted average of these interest rates thus
represents the input price associated with interest expenses in the
current period. Thus, the interest input price for the current period
measures price aspects of current interest expenses, just as the
operating input price index for the current period measures price
aspects of current operating expenses for labor and non-capital goods
and services. The interest input price appropriately differs from the
operating input price in that the interest input price is a vintage-
weighted composite of all interest rates for debt instruments that are
still active in the current period, while the operating index input
price measures purchase prices for current periods only.
Comment: A commenter agreed with HCFA's inclusion of interest in
the CIPI. However, the commenter did not agree with the HCFA vintage
approach to determining the interest component. The commenter instead
recommended measuring annual price changes in financing costs.
Response: We agree with this commenter that the price increases in
interest are an integral and accepted component of capital costs and
therefore should be included in the CIPI. However, we do not believe
that using annual price changes in interest rates will appropriately
measure the price change for interest expenses that have a vintage
nature. The HCFA CIPI measures the price aspects associated with
current interest expense, which include interest costs for all still-
active past debt instruments appropriately
[[Page 45819]]
weighted. It would be inappropriate to update the interest expense
component of the CIPI by the annual change in the current year interest
rate when current year interest expense reflects interest rates on debt
in various years, or vintages. Also, using the change in the current
year interest rate would create a volatile series in the CIPI that
would lack predictability, as well as inappropriately measure price
increases in current year interest expense. The HCFA CIPI should
include a vintage-weighted interest component, appropriately weighted,
to validly measure price increases in current year interest expense.
Comment: One commenter stated that once the negative interest
adjustment proposed by HCFA is eliminated, ProPAC's CIPI and HCFA's
CIPI show very little difference.
Response: HCFA has not proposed a negative adjustment for interest,
but merely requires that the price aspect of interest expense be
appropriately measured in the CIPI. In the most recent historical and
forecasted periods, it is true that the interest component is negative;
however, it is correctly negative because the effect of interest rate
decreases in recent years has been to decrease the interest price faced
by hospitals for all the debt instruments that are still in effect. In
addition, the commenter's contention about the result of removing the
interest component from the CIPI is erroneous. In many of the years
from 1979 to 1994, removal of the interest component creates larger
differences between the HCFA CIPI and the ProPAC CIPI.
Our original version of the CIPI employed proportional annual
weights in determining the moving averages of the purchase prices
associated with depreciation and interest. A commenter on a previous
version of the CIPI recommended that proportional annual vintage
weights for capital price proxies be replaced by non-proportional
annual vintage weights that reflect the relative vintage purchases of
capital. The commenter pointed out that annual purchases of real
capital tend to increase over time. As annual purchases of real capital
increase, the later years in the moving average of depreciation and
interest costs should be weighted more heavily than the earlier years.
We agree with this comment. Accordingly, a special data base was
prepared to provide appropriate historical vintage weights for
depreciation and interest input prices. The non-proportional vintage
weights in the CIPI appropriately reflect the relative contributions of
current capital purchase prices and current interest rates to total
capital price in the current year.
Current year other capital-related expenses (for example,
insurance) have an annual time dimension and, therefore, prices
associated with these expenses are, like operating input prices,
current year prices only.
Comment: One commenter recommended that HCFA use a more recent year
as the base year for the CIPI to increase consistency with current
hospital capital expenditure patterns. Another commenter agreed that
delaying the rebasing will improve the market basket and, therefore, is
appropriate.
Response: We agree that using a more recent base year is desirable
and, as we discussed in the June 2, 1995 (60 FR 29229) proposed rule,
we have done preliminary research into the effects of changing the base
year from FY 1987 to FY 1992. The initial results from currently
available data sources have shown small differences between the FY 1987
and FY 1992 base year weights, resulting in a minimal effect on the
CIPI. We intend to use expanded capital-related data in the FY 1992 and
FY 1993 Medicare cost reports in the rebasing effort. The expanded
capital-related data is available beginning with FY 1992 cost reports;
therefore, we are examining the data thoroughly for reliability and
accuracy using FY 1993 as a validity check. To ensure that the data is
reasonable, we plan to compare data from other sources, some of which
are not available at this time, to the expanded capital-related data in
the Medicare cost reports. Exercising this added discretion before
using the expanded capital Medicare data will not only produce more
representative and reliable data, but would also ensure that the data
are less subject to interpretation and error. It is for these reasons
that we delayed the rebasing originally planned for FY 1996.
The FY 1987 composite data base starts with financial variables
from the American Hospital Association (AHA) Panel Survey. These data
are augmented by data from the Medicare cost reports and from the
Department of Commerce Capital Expenditure Survey. The composite data
base provides annual estimates of nominal purchases for building and
fixed equipment and for movable equipment. Leasing amounts were
distributed among building and fixed equipment and movable equipment
nominal purchases by first computing the percentage of total owner-
operated nominal purchases attributable to each type of equipment, and
then applying these percentages to total leasing amounts. Nominal
purchases were then converted to annual real (that is, constant dollar)
purchases by dividing nominal expenditures by an appropriate purchase
price proxy.
Expected life for building and fixed equipment and for movable
equipment were derived from Medicare cost reports by dividing the book
value of assets by current year depreciation amounts. The relative
distribution of real capital purchases within the respective life for
building and fixed equipment (25 years) and for movable equipment (10
years) were derived from the special data base. These relative
distributions are shown in Table 1. Relative distributions for a number
of different time periods were averaged to obtain the distributions in
Table 1. These distributions were all very similar regardless of the
periods chosen and, therefore, we selected an average of the
distributions in order to simplify the calculations.
Table 1.--Relative Weights for Capital-Related Price Proxies
Building and Fixed Equipment Expected Life: 25 years:
1............................................................ 0.015
2............................................................ 0.019
3............................................................ 0.022
4............................................................ 0.024
5............................................................ 0.023
6............................................................ 0.022
7............................................................ 0.020
8............................................................ 0.021
9............................................................ 0.025
10........................................................... 0.030
11........................................................... 0.033
12........................................................... 0.034
13........................................................... 0.034
14........................................................... 0.035
15........................................................... 0.038
16........................................................... 0.043
17........................................................... 0.049
18........................................................... 0.053
19........................................................... 0.056
20........................................................... 0.057
21........................................................... 0.060
22........................................................... 0.066
23........................................................... 0.071
24........................................................... 0.075
25........................................................... 0.077
------------------------------------------------------------------------
Total...................................................... 1.000
========================================================================
Movable Equipment Expected Life: 10 years:
1............................................................ 0.064
2............................................................ 0.072
3............................................................ 0.077
4............................................................ 0.085
5............................................................ 0.095
6............................................................ 0.101
7............................................................ 0.109
8............................................................ 0.122
9............................................................ 0.132
10........................................................... 0.142
------------------------------------------------------------------------
Total...................................................... 1.000
========================================================================
[[Page 45820]]
Interest Expected Life: 22 years:
1............................................................ 0.007
2............................................................ 0.009
3............................................................ 0.010
4............................................................ 0.011
5............................................................ 0.013
6............................................................ 0.015
7............................................................ 0.017
8............................................................ 0.020
9............................................................ 0.023
10........................................................... 0.027
11........................................................... 0.032
12........................................................... 0.038
13........................................................... 0.043
14........................................................... 0.050
15........................................................... 0.057
16........................................................... 0.064
17........................................................... 0.074
18........................................................... 0.083
19........................................................... 0.090
20........................................................... 0.098
21........................................................... 0.105
22........................................................... 0.114
------------------------------------------------------------------------
Total...................................................... 1.000
Source: Health Care Financing Administration, Office of the Actuary
(Medicare Cost Reports, AHA Panel Survey, Securities Data Inc.)
Table 2 shows the historical, annual percentage changes in the
capital-related price proxies employed in the CIPI prior to vintage-
weighting. These proxies are as follows: the institutional construction
index maintained by Boeckh for the unit prices of fixed assets; the
machinery and equipment component of the Producer Price Index (PPI-11)
for movable equipment; the average yield on domestic municipal bonds
from the Bond Buyer index of 20 bonds (Muni); the average yield on
Moody's corporate bonds (AAA); a composite of Muni and AAA indexes
(Combined Muni/AAA); and the residential rent component of the Consumer
Price Index (CPI Rent) for other capital costs.
We previously used the Engineering News-Record (ENR) building cost
index as a price proxy for the unit price of fixed assets. However, we
believe that the Boeckh institutional construction index is more
applicable to the industry. The variation between the two indexes is
minimal.
We applied the relative vintage depreciation weights from Table 1
to the appropriate non-vintage weighted historical, annual index levels
(base year FY 1987) of depreciation price proxies to generate the
current year, vintage-weighted component index levels for the CIPI
depreciation sector. The annual percentage change between the non-
vintage weighted historical, annual depreciation index levels are
listed in Table 2. The annual percentage changes between the annual,
vintage-weighted depreciation component index levels (base year FY
1987) are listed in Table 3. For example, the FY 1996 movable equipment
index component percentage change of 1.8 percent in Table 3 was
computed as the percentage change between the FY 1995 and FY 1996
vintage-weighted movable equipment component index levels. The FY 1996
movable equipment component index (base year FY 1987) represents the
weighted-average of the index levels in the movable equipment price
proxy (PPI-11 in Table 2) for the previous 10 years (that is, FY 1987
through 1996), weighted by the relative vintage weights listed for
movable equipment in Table 1. These calculations are slightly different
than prior versions of the CIPI in the Federal Register, and reflect a
more refined weighting methodology.
Table 2.--Annual Percent Changes for Non-Vintage Weighted Capital Input Price Proxies, Fiscal Years 1949 to 2000
[Proxy name--BOECKH--institutional construction, PPI-11-machinery and equipment, Muni--average yield on domestic
municipal bonds--bond buyer (20 bonds), AAA--average yield on moody's AAA corporate bonds, CPI rent (all urban)--
residential rent]
----------------------------------------------------------------------------------------------------------------
Combined
Fiscal year BOECKH PPI-11 Muni AAA Muni/AAA CPI rent
----------------------------------------------------------------------------------------------------------------
1949.............................. 3.3 7.4 -4.4 -3.1 -4.2 4.4
1950.............................. 1.4 0.5 -9.4 -4.2 -8.4 3.9
1951.............................. 8.6 13.6 -5.8 7.1 -3.4 3.7
1952.............................. 3.7 1.6 12.9 5.7 11.4 4.2
1953.............................. 3.5 0.8 25.9 7.3 22.2 4.7
1954.............................. 1.5 2.7 -8.2 -6.3 -7.9 4.8
1955.............................. 1.8 1.9 -0.4 1.1 -0.1 1.4
1956.............................. 4.8 7.5 7.8 7.6 7.8 1.7
1957.............................. 3.6 8.0 24.0 18.0 23.0 1.9
1958.............................. 1.8 3.2 -3.7 -1.1 -3.3 1.9
1959.............................. 3.1 1.6 11.5 13.3 11.8 1.3
1960.............................. 2.7 1.5 1.7 4.9 2.3 1.6
1961.............................. 1.1 -0.3 -3.1 -3.2 -3.2 1.3
1962.............................. 2.2 0.0 -6.4 0.8 -5.1 1.3
1963.............................. 2.3 0.0 -3.4 -2.8 -3.3 1.0
1964.............................. 2.8 0.9 3.2 3.3 3.2 1.0
1965.............................. 3.1 0.6 -0.5 1.6 -0.1 1.0
1966.............................. 3.8 2.7 16.5 11.0 15.4 1.2
1967.............................. 5.3 3.8 2.4 8.3 3.5 1.7
1968.............................. 7.3 2.8 14.7 14.5 14.6 2.4
1969.............................. 8.4 3.3 21.5 9.8 19.2 2.8
1970.............................. 7.0 4.2 22.2 18.0 21.4 4.1
1971.............................. 8.7 4.2 -13.9 -4.9 -12.3 4.7
1972.............................. 8.0 2.2 -5.8 -3.8 -5.4 3.6
1973.............................. 6.0 2.6 -1.8 0.8 -1.3 4.0
1974.............................. 8.0 9.9 12.6 12.5 12.6 4.9
1975.............................. 11.1 19.5 19.2 7.9 16.9 5.2
1976.............................. 7.6 6.7 -1.2 -3.2 -1.5 5.3
1977.............................. 8.5 6.0 -15.8 -6.4 -14.1 5.8
1978.............................. 6.6 7.6 1.1 5.6 2.0 6.7
1979.............................. 7.5 8.7 7.3 8.9 7.6 7.1
1980.............................. 8.6 11.5 26.9 22.9 26.1 8.6
1981.............................. 9.8 10.6 32.9 20.7 30.5 8.8
[[Page 45821]]
1982.............................. 9.6 7.1 16.2 5.5 14.2 8.0
1983.............................. 7.0 3.2 -22.5 -17.7 -21.7 6.3
1984.............................. 5.2 2.3 4.8 6.9 5.1 5.0
1985.............................. 2.0 2.2 -5.3 -7.1 -5.6 5.9
1986.............................. 1.6 1.5 -18.1 -19.6 -18.4 6.2
1987.............................. 2.1 1.5 -5.5 -5.3 -5.5 4.5
1988.............................. 2.3 2.2 7.1 9.9 7.6 3.8
1989.............................. 3.6 3.5 -6.7 -4.8 -6.3 3.8
1990.............................. 2.5 3.1 -1.2 -2.0 -1.3 4.2
1991.............................. 2.7 2.2 -2.7 -2.6 -2.7 3.9
1992.............................. 3.1 0.5 -7.4 -8.2 -7.5 2.6
1993.............................. 2.4 0.4 -10.6 -8.9 -10.3 2.4
1994.............................. 2.8 0.8 0.0 0.2 0.0 2.3
1995.............................. 3.1 1.4 6.2 8.1 6.5 2.7
1996.............................. 2.8 3.0 -6.9 -6.0 -6.7 3.0
1997.............................. 3.4 2.4 4.2 1.5 3.7 2.2
1998.............................. 3.4 2.5 -2.3 1.3 2.1 3.6
1999.............................. 3.2 2.4 -1.3 -0.6 -1.2 2.5
2000.............................. 3.2 2.5 0.5 0.6 0.5 2.7
----------------------------------------------------------------------------------------------------------------
Source: DRI/McGraw-Hill HCC, 2nd Qtr 1995; @USSIM/TRENDLONG0595; @CISSIM/CCONTROL952.
Released By: HCFA, OACT, Office of National Health Statistics.
Table 3.--HCFA Capital Input Price Index Percent Changes, Total and Components, Fiscal Years 1979 to 2000
----------------------------------------------------------------------------------------------------------------
Depreciation
---------------------------------------
Fiscal year Total Building Interest Other
Total and fixed Movable
equipment equipment
----------------------------------------------------------------------------------------------------------------
Weights (FY1987).................. 1.0000 0.6510 0.3054 0.3456 0.3274 0.0216
----------------------------------------------------------------------------------------------------------------
Price Changes
----------------------------------------------------------------------------------------------------------------
1979.............................. 5.6 7.4 6.9 7.7 2.6 7.1
1980.............................. 7.1 7.9 7.2 8.6 5.6 8.6
1981.............................. 8.8 8.4 7.6 9.1 9.5 8.8
1982.............................. 9.3 8.5 7.9 9.0 10.6 8.0
1983.............................. 6.7 8.0 7.8 8.1 4.7 6.3
1984.............................. 6.3 7.2 7.5 6.9 4.8 5.0
1985.............................. 5.1 6.2 6.7 5.7 3.3 5.9
1986.............................. 3.7 5.5 6.1 5.0 0.4 6.2
1987.............................. 3.1 4.9 5.6 4.3 -0.5 4.5
1988.............................. 3.0 4.5 5.3 3.8 0.1 3.8
1989.............................. 2.7 4.3 5.1 3.6 -0.7 3.8
1990.............................. 2.4 3.9 4.8 3.2 -1.0 4.2
1991.............................. 2.1 3.6 4.5 2.7 -1.3 3.9
1992.............................. 1.7 3.2 4.3 2.1 -2.1 2.6
1993.............................. 1.3 2.9 4.1 1.8 -2.9 2.4
1994.............................. 1.3 2.8 4.0 1.6 -2.7 2.3
1995.............................. 1.5 2.7 3.9 1.6 -1.9 2.7
1996.............................. 1.5 2.8 3.8 1.8 -2.5 3.0
1997.............................. 1.7 2.8 3.7 1.9 -2.0 2.2
1998.............................. 1.9 2.8 3.6 2.0 -1.5 3.6
1999.............................. 1.9 2.8 3.5 2.0 -1.4 2.5
2000.............................. 1.9 2.8 3.5 2.0 -1.2 2.7
----------------------------------------------------------------------------------------------------------------
Source: DRI/McGraw-Hill HCC, 2nd Qtr 1995; @USSIM/TRENDLONG0595;
@CISSIM/CONTROL952.
Released By: HCFA, OACT, Office of National Health Statistics.
As we have discussed in connection with previous versions of the
CIPI, stability is an important criterion for evaluating such an index.
Stability is an inherent characteristic of capital because of its
vintage nature; since capital assets are consumed over time, they are
replaced at a relatively slow rate. An input price index for capital
[[Page 45822]]
should reflect the relative stability of capital assets themselves.
Furthermore, excessive volatility in a price index deprives the index
of predictability, thus inhibiting the ability of institutions to plan
for changes in capital payments resulting from changes in the CIPI. We
graphically demonstrated (using the projections available at that time)
the stability of the annual HCFA vintage-weighted CIPI compared to
annual changes in non-vintage-weighted capital purchase prices in
Figures 1 and 2 in our discussion of May 27, 1994 (59 FR 27882).
ProPAC recommends a capital input price index based on annual
changes in current capital purchase prices excluding consideration of
weighted historical capital purchase prices (that is, not vintage
weighted). We previously argued that the ProPAC index was not
consistent with the operating input price index that is currently used
to assist in updating DRG payment rates. We would add that the greater
volatility in annual purchase prices would introduce an unacceptable
degree of volatility in prospective capital payments and does not
reflect the inherent stability that comes from the vintage nature of
capital.
Comment: One commenter contended that the HCFA CIPI is excessively
complicated, considering that its purpose is to update just a small
portion (approximately 10 percent) of payments to hospitals for
inpatient services. The commenter recommended that a simpler approach
be adopted.
Response: Capital expenses for prospective payment hospitals are
expected to be about $7.8 billion in FY 1996, a significant amount that
warrants an appropriate input price index. While the HCFA CIPI does
include vintage-weighting of both depreciation and interest prices, the
HCFA CIPI is actually a simplification of the complicated capital
accumulation process it is measuring. It would not be appropriate to
accept an index that does not measure capital prices as well just
because it is simpler. The HCFA CIPI is complicated only to the point
that it accurately measures price increases for capital purchased in a
financial world that is itself inherently complicated by the vintage
nature of capital. Despite its necessary complexities, the HCFA CIPI
provides an accurate, less volatile measure of price increases than
annual price changes, providing hospitals with the ability to plan for
changes in capital payments. As stated earlier, the vintage nature of
capital requires that the index reflect the stability of capital
assets.
Another commenter on a previous version of the CIPI recommended
that data from Securities Data Corporation be incorporated into the
CIPI interest computations. This source provides information on
hospital issuances of municipal and commercial bonds. From this data
base, we incorporated information showing that the average expected
life of hospital bond debt instruments (that is, the time interval
between the issue date and the maturation date) was about 13 years for
municipal serial bonds and about 25 years for municipal term bonds. The
weighted average life for the 2 types of bonds was 22 years.
The relative nominal capital purchases within various 22-year
periods provided appropriate vintage weights for annual changes in
interest rates. Not all capital purchases are funded by debt. Medicare
cost reports suggest that about 80 percent of new capital acquisitions
are financed by debt and about 20 percent by equity financing. However,
if the proportion of total purchases financed by debt does not change
substantially from year to year, then it is irrelevant whether we use
the full amount or a constant proportion of the full amount of nominal
capital acquisitions as weights for relative amounts of the debt
instruments still active in the current period.
A third commenter on a previous version of the CIPI recommended
that we investigate the effects on interest rate changes of changing
structures of hospital bond ratings. If bond ratings are deteriorating,
hospitals incur higher interest rate charges; if bond ratings improve,
hospitals incur lower interest rates. Our CIPI currently recognizes
only changes in pure interest rates and does not recognize changes in
effective interest rates due to changes in bond ratings.
We reviewed a hospital municipal-bond data base from Securities
Data Corporation to examine that issue. The data showed that serial
bonds continue to dominate short-term financing and that term bonds
dominate long-term financing. We classified all bond amounts by ratings
found in the data base for years 1980 to 1993. The distribution of
those issues described with a Moody's Quality Rating, shown in Table 4
(portions are applied to dollar amount of debt issued), indicates a
trend toward higher quality issues since 1984. Although the annual,
aggregate issue amounts in Moody's quality range Aaa through A have
remained approximately constant since 1980, issue amounts in the
highest quality band have become substantially higher since inception
of the prospective payment system. Both issue amounts in the Aaa-Aa3
ranges and those in the Aaa-A range are greater in 1993 than at any
time since 1980. We conclude there is not sufficient evidence to
justify a component for deteriorating bond ratings in the CIPI.
Table 4.--Percent Distribution of Hospital Municipal Bond Amounts by
Moody's Quality Rating.*
------------------------------------------------------------------------
Pre- Post-prospective payment
prospective system
payment system -------------------------------
---------------- 1984-1988 1989-1993
1980-1983 -------------------------------
----------------
(percent) (percent) (percent)
------------------------------------------------------------------------
Aaa-Aa3................. 7.1 36.8 49.0
Aa-A.................... 50.6 24.1 21.7
Baa1-Ba................. 9.6 3.6 8.0
Not Rated............... 31.0 32.7 17.9
------------------------------------------------------------------------
* Distributions do not sum to 100 percent due to a residual category of
missing data.
Notes:
(1) Aggregate issues from Aaa-A have remained fairly constant since
1980.
(2) Issue amounts in the highest quality band have become substantially
higher since inception of the prospective payment system.
(3) Both issue amounts in the Aaa-Aa3 ranges and those in the Aa-A
ranges are greater in 1993 than at any time since 1980.
[[Page 45823]]
Relative vintage interest weights derived from our procedure are
shown in Table 1. When combined with index levels (base year FY 1987)
of annual, non-vintage weighted interest rate proxies, the relative
interest weights provide current year, vintage-weighted component index
levels for interest rates in the CIPI. The annual percentage change
between the non-vintage-weighted historical, annual interest index
levels are listed in Table 2. The annual percentage change between the
annual, vintage-weighted interest component index levels (base year FY
1987) are listed in Table 3. Thus, for example, the interest rate
component change of -2.5 percent in Table 3 for FY 1996 represents the
annual percentage change between the 1995 and 1996 vintage-weighted
interest component index levels. The 1996 interest component index
level (base year FY 1987) is computed as the vintage-weighted average
of the previous 22 years in the interest rate proxy index level
(Combined Muni/AAA) in Table 2, weighted by the interest weights listed
in Table 1. We use an index level for a combined municipal and AAA
commercial bond interest rate (percent changes shown in Table 2 as
Combined Muni/AAA), giving the municipal rate an 85 percent weight and
the AAA rate a 15 percent weight, reflecting the relative hospital
debts of the government/non-profit hospital sector and the for-profit
sector.
Although Medicare cost reports show that only 60 percent of current
hospital debt is in the form of notes or bonds (about 40 percent is in
the form of mortgages), we assumed that the relative annual weights for
all debt and the relative annual changes in interest rates for all debt
were the same as bond-related weights and price changes. We are still
searching for an appropriate source of information on hospital
commercial mortgage data. We do not expect that the discovery of such
data will materially alter our current conclusions about trends in
effective interest rates over time.
c. Projection of the CIPI for Fiscal Year 1996. DRI projects a 1.5
percent increase in the CIPI for FY 1996 (Table 3). This is the outcome
of a 2.8 percent increase in projected weighted depreciation prices in
FY 1996, partially offset by a 2.5 percent decline in vintage-weighted
interest rates in FY 1996.
d. ProPAC Input Price Index.
i. Introduction. Three major differences distinguish ProPAC's CIPI
from HCFA's CIPI:
The ProPAC CIPI measures changes in capital asset purchase
prices in the year the asset is purchased (that is, not vintage-
weighted). HCFA's CIPI is designed to measure changes in a vintage-
weighted composite of capital asset purchase prices.
The ProPAC CIPI uses the Marshall and Swift hospital
equipment index as the movable equipment purchase price proxy while
HCFA uses the Producer Price Index for machinery and equipment.
The ProPAC CIPI has no interest component. ProPAC treats
interest rate changes as an optional separate update policy adjustment
factor.
Through 1996, for example, ProPAC expects that long term interest
rates will remain relatively stable and, therefore, believes that it is
not appropriate to adjust capital input prices for forecasted changes
in interest rates in the target year.
HCFA incorporates a vintage-weighted composite of interest rates in
its CIPI for the target year.
ii. Depreciation. ProPAC states that its CIPI is analogous to the
prospective payment operating price index. We disagree. The components
of the operating index represent price changes in ongoing hospital
expenses for labor and non-capital goods and services. The analogous
capital expenses in this context are current depreciation costs,
interest costs, and other capital-related expenses (such as insurance).
Current depreciation and interest costs, according to HCFA, IRS, and
accounting principles, are a cumulative composite of segments of
expenses incurred in current and prior periods. Current interest costs
are a cumulative composite of segments of past and current year debt
costs. Since both depreciation and interest costs have a vintage
component, the price aspect of these costs must have a vintage
component as well. The HCFA CIPI attempts to capture these vintage
components.
Differences between HCFA and ProPAC with respect to choices for
annual non-vintage-weighted rates of change in alternative price
proxies for movable equipment are small for much of the historical
period. (We illustrated this fact in Figure 8 (Inset) in the May 27,
1994 proposed rule (59 FR 27890), using earlier projections.) As noted
in our September 1, 1992 final rule, one basic criterion for accepting
price proxies is public availability of documentation on data sources
and methodology (57 FR 40018-40019). Despite repeated efforts, neither
we nor Data Resources Inc. have been able to obtain documentation on
the movable price proxy recommended by ProPAC (Marshall and Swift
hospital equipment index) that explains how it is derived and what
sampling frame and sampling error attach to the estimates. In the
absence of such information we cannot adopt the ProPAC alternative.
HCFA's assumption is that prices for movable equipment purchased by
hospitals change at about the same rate as prices for machinery and
equipment generally. This assumption is justified in part by the fact
that not all movable equipment purchased by hospitals is medical
equipment; it stands to reason that the prices for non-medical movable
equipment purchased by hospitals, such as automobiles, desks, chairs,
etc., would change at about the same rate as prices for all machinery
and equipment. To examine this assumption further, we measured the rate
of change in the HCFA movable price proxy relative to prices for
medical equipment only by preparing a composite index of medical prices
from the Bureau of Labor Statistics Producer Price Index (PPI) for two
commodity categories--medical instruments/equipment and X-ray/electro-
medical equipment. The two PPI commodity indexes were then merged using
their respective PPI weights. Price changes for this index are not
available for years prior to 1984. Annual price changes for medical
equipment follow the annual HCFA price proxy more closely than the
ProPAC price proxy for most of the historical period. We will continue
to monitor trends in these indexes to ensure that appropriate price
proxies are incorporated in the CIPI.
iii. Interest. ProPAC has proposed to project annual interest rates
to future periods and then to decide whether to allow an add-on to the
Federal capital rate depending on the magnitude of the projection.
ProPAC has presented no objective criteria for determining when an
interest adjustment is appropriate. We previously noted that a single-
year projection for interest rates is conceptually inappropriate since
interest costs must be vintage-weighted. In addition to this conceptual
problem, the ProPAC approach is impractical because future annual
interest rates are volatile, vulnerable to unpredictable market forces,
and subject to exogenous influences (such as Federal Reserve Board
decisions) that are difficult to anticipate. Thus, any projection of
future annual interest rates is likely to be inaccurate, resulting in
underpayment or overpayment of the Federal capital rate relative to the
capital-related expenses that the rate is supposed to reflect. The
resulting uncertainty in payments under future Federal capital rates
further complicates future capital expenditure decisions by hospitals.
On the other hand, the
[[Page 45824]]
projected HCFA CIPI interest component for the target year is the
weighted average change over 22 years of interest rate history, of
which 20 years experience in the non-vintage weighted price proxy is
appropriately historical. The projected annual, non-vintage weighted
experience in the price proxy for the most recent 2 years may be as
inaccurate as any ProPAC projection, but any error will have minimal
effects on Federal rates due to the appropriately weighted effect of
the historical data in the HCFA CIPI. This stability in the interest
rate component of the HCFA CIPI provides hospital planners with a
degree of certainty about future Federal rate payments, other things
remaining equal.
iv. The Composite CIPI. Annual percentage changes in the historical
and projected HCFA and ProPAC CIPIs differ markedly as shown in Table
5. The 2.9 percent increase for the ProPAC capital market basket in
Table 5 for FY 1996 is lower than the 4.1 percent increase presented in
ProPAC's March 1995 Report and Recommendation to the Congress. In the
ProPAC March report, ProPAC used the 4th quarter 1994 DRI forecasts,
while the figure in this final rule represents 2nd quarter 1995 DRI
forecasts. Between 4th quarter 1994 and 2nd quarter 1995, DRI revised
its forecast downward by 1.2 percentage points to reflect slower price
growth in 1996 than originally expected. A lower forecast for the
movable equipment price proxy (Marshall and Swift) was responsible for
roughly 60 percent of the 1.2 percentage point decline between
forecasts. The remaining 40 percent of the decline was the result of
lower forecasts in the fixed equipment price proxy (Boeckh) and the
other capital-related expenses price proxy (CPI-residential rent),
which accounted for roughly 23 percent and 12 percent, respectively. We
emphasize that the later forecast was not available when ProPAC
released its March report.
The ProPAC CIPI is much more volatile than the HCFA CIPI in the
historical period through 1994 because it does not reflect vintage-
weighted capital input price factors for depreciation. Further, the
ProPAC CIPI omits conceptually relevant interest rates. The cumulative
effect of declining interest rates for all debt instruments in recent
years has driven the rate of change in the HCFA vintage-weighted
interest rate component downward, a trend projected by DRI into future
rate years. The declining interest rate component appropriately brings
the HCFA CIPI below the ProPAC CIPI in the projection period. Other
things being equal, the ProPAC index would result in overpayment
through the Federal rate because anticipated actual capital-related
expenses will be less than ProPAC projects due to the effects of lower
interest rates on capital-related expenses.
Table 5.--Annual Percent Changes in HCFA Capital Input Price Index and
the ProPAC Capital Market Basket, 1979 to 2000
------------------------------------------------------------------------
HCFA
capital ProPAC
Fiscal year input capital
price market
index basket
------------------------------------------------------------------------
1979................................................ 5.6 8.3
1980................................................ 7.1 9.2
1981................................................ 8.8 10.0
1982................................................ 9.3 7.7
1983................................................ 6.7 4.6
1984................................................ 6.3 3.9
1985................................................ 5.1 2.2
1986................................................ 3.7 1.7
1987................................................ 3.1 2.1
1988................................................ 3.0 3.5
1989................................................ 2.7 4.6
1990................................................ 2.4 2.3
1991................................................ 2.1 3.0
1992................................................ 1.7 2.2
1993................................................ 1.3 2.1
1994................................................ 1.3 2.8
1995................................................ 1.5 3.4
1996................................................ 1.5 2.9
1997................................................ 1.7 3.4
1998................................................ 1.9 3.3
1999................................................ 1.9 3.2
2000................................................ 1.9 3.4
------------------------------------------------------------------------
Source: DRI/McGraw-Hill HCC, 2nd Qtr 1995; @USSIM/TRENDLONG0595; @CISSIM/
CONTROL952.
Released By: HCFA, OACT, Office of National Health Statistics.
ProPAC believes that Medicare program payments should reflect both
savings from low interest rate levels on new debt instruments and the
additional costs of high interest rate levels. As explained above, the
Commission has proposed accomplishing this through an interest policy
adjustment. However, ProPAC has neither presented a threshold level for
making an interest adjustment nor established a process for determining
the amount of the adjustment. The HCFA CIPI, on the other hand,
automatically registers the price effects of interest rate changes on
new debt instruments that carry over into future periods, although
those effects are appropriately registered only very gradually.
When interest rate levels decline, hospitals may refinance their
existing debt. Refinancing has a price effect as new debt instruments
with lower prices (interest rate levels) replace older debt instruments
with higher prices (interest rate levels). ProPAC believes its interest
policy adjustment can and should capture this behavior. In this way,
Medicare can share in the savings from refinancing. The HCFA CIPI does
not now automatically register the price effects of refinancing.
Whether to do so or not is a policy judgment concerning whether HCFA
should share in refinancing savings or allow hospitals to realize the
full effects of refinancing. A refinancing adjustment would not only
reflect actual hospital behavior, but would also add to the existing
incentives of a rate-based system for hospitals to replace high
interest debt instruments with lower interest debt instruments.
However, the absence of a refinancing adjustment could allow individual
hospitals to refinance and keep the savings, just as individual
hospitals who become relatively more efficient in furnishing care for
specific DRGs are rewarded for the more efficient behavior.
Since refinancing is a price matter, the adjustment would
appropriately be on the price side of the framework, rather than on the
policy adjustment side, which deals with quantities. However, the
adjustment would not be included directly within the CIPI because the
price effect of refinancing involves a shift in the vintage weights
applied to index levels. That is, interest expense associated with
prices (interest rate levels) in the year the debt is originated would
be shifted to reflect interest expense associated with prices in the
year the debt is refinanced. This essentially would reduce the relative
vintage weights for interest in the CIPI (Table 1) in some years and
increase the relative vintage weights for interest in other years. Yet
by definition, the fixed-weight CIPI holds all weights constant.
However, a discretionary adjustment could be made on the relative
vintage weights. This is analogous to the separate adjustments for real
case-mix changes in the update framework.
In the June 2, 1995 proposed rule we invited comments on whether to
incorporate a refinancing adjustment within the HCFA framework. A
refinancing adjustment would present specific problems because HCFA has
not been able to obtain data to accurately determine refinancing
amounts. Whether HCFA can ultimately propose a refinancing adjustment
depends upon whether the necessary data can be obtained.
Comment: Two commenters stated that a proposed refinancing
adjustment is not necessary. One commenter indicated that hospitals
should be rewarded by keeping savings from
[[Page 45825]]
efficient behavior such as refinancing high interest debt. The other
commenter indicated that it would not be proper for hospitals to be
penalized or rewarded based on a theoretical refinancing threshold that
would trigger an adjustment.
Response: These comments are useful in analyzing the merits and
technical difficulties of including a refinancing adjustment in the
HCFA update framework. We are continuing to determine whether a
refinancing adjustment is appropriate, and, if so, how to implement
one. We will provide any additional findings in upcoming notices. We
encourage comments and suggestions, like those we have received, or
recommendations of any studies or data sources that would be useful in
assessing and/or implementing a refinancing adjustment.
4. Case-Mix Adjustment and Adjustment for Forecast Error
We proposed that the update framework contain adjustments for
changes in the case-mix index and for forecast error.
The case-mix index (CMI) is the measure of the average DRG weight
for cases paid under the prospective payment system. Because the DRG
weight determines the prospective payment for each case, any percentage
increase in the CMI corresponds to an equal percentage increase in
hospital payments.
The CMI can change for any of several reasons: because the average
resource use of Medicare patients changes (``real'' case-mix change);
because changes in hospital coding of patient records result in higher
weight DRG assignments (``coding effects''); and because the annual DRG
reclassification and recalibration changes may not be budget neutral
(``reclassification effect''). We define real case-mix change as actual
changes in the mix (and resource requirements) of Medicare patients as
opposed to changes in coding behavior that result in assignment of
cases to higher-weighted DRGs but do not reflect higher resource
requirements. In the update framework for the prospective payment
system for operating costs, we adjust the update upwards to allow for
real case-mix change, but remove the effects of coding changes on the
CMI. We also remove the effect on total payments of prior changes to
the DRG classifications and relative weights, in order to retain budget
neutrality for all CMI-related changes other than patient severity.
(For example, we adjusted for the effects of the FY 1992 DRG
reclassification and recalibration as part of our FY 1994 update
recommendation.) The operating adjustment consists of a reduction for
total observed case-mix change, an increase for the portion of case-mix
change that we determine is due to real case-mix change rather than
coding modifications, and an adjustment for the effect of prior DRG
reclassification and recalibration changes. We proposed to adopt this
CMI adjustment as well in the capital update framework.
For FY 1996, we are projecting a 0.8 percent increase in the case-
mix index. We estimate that real case-mix increase will equal projected
case-mix increase in FY 1996. We do not anticipate any changes in
coding behavior in our projected case-mix change. The proposed net
adjustment for case-mix change in FY 1996 is therefore 0.0 percentage
points.
The -1.0 percent figure used in the ProPAC framework represents
ProPAC's projection for observed case-mix change. ProPAC projects a 0.8
percent increase in real case-mix change across DRGs and a 0.2 percent
increase in within-DRG complexity. ProPAC's net adjustment for case mix
is therefore zero.
We estimate that FY 1994 DRG reclassification and recalibration
resulted in a 0.3 percent increase in the case mix when compared with
the case-mix index that would have resulted if we had not made the
reclassification and recalibration changes to the DRGs. ProPAC does not
make an adjustment for DRG reclassification and recalibration in its
update recommendation.
The current operating update framework contains an adjustment for
forecast error. The input price index forecast is based on historical
trends and relationships ascertainable at the time the update factor is
established for the following year. In any given year there can be
unanticipated price fluctuations that can result in differences between
the actual increase in prices faced by hospitals and the forecast used
in calculating the update factors. We continue to believe that the
capital update framework should include a forecast error adjustment
factor. In setting a prospective payment rate under the proposed
framework, we proposed to make an adjustment for forecast error only if
our estimate of the capital input price index rate of increase for any
year is off by 0.25 percentage points or more. There is a 2-year lag
between the forecast and the measurement of the forecast error. Thus,
for example, we would adjust for a forecast error made in FY 1996
through an adjustment to the FY 1998 update.
We received no comments on our proposed adjustments for case-mix
increase and for forecast error. In this final rule, we are therefore
adopting those adjustments as proposed.
5. Policy Adjustment Factors
The capital input price index measures the pure price changes
associated with changes in capital-related costs (prices x
``quantities''). The composition of capital-related costs is maintained
at base-year 1987 proportions in the capital input price index. We
proposed to address appropriate changes in the amount and composition
of capital stock through the policy adjustment factors.
The current update framework for the prospective payment system for
operating costs includes factors designed to adjust the input price
index rate of increase for policy considerations. Under the revised
operating framework, we adjust for service productivity (the efficiency
with which providers produce individual services such as laboratory
tests and diagnostic procedures) and intensity (the amount of services
used to produce a discharge). The service productivity factor for the
operating update framework reflects a forward-looking adjustment for
the changes that hospitals can be expected to make in service-level
productivity during the year. A hospital retains any productivity
increases above the average.
The intensity factor for the operating update framework reflects
how hospital services are utilized to produce the final product, that
is, the discharge. This component accounts for changes in the use of
quality-enhancing services, changes in within-DRG severity, and
expected modification of practice patterns to remove cost-ineffective
services. We proposed that the intensity adjustment factor in the
operating framework be adopted in the capital update framework. Under
the operating update framework, we calculate case-mix constant
intensity as the change in total charges per admission, adjusted for
price level changes (the CPI hospital component) and changes in real
case mix. The use of total charges in the calculation of the proposed
intensity factor makes it a total intensity factor, that is, charges
for capital services are already built into the calculation of the
factor. We therefore proposed to incorporate the intensity adjustment
from the operating update framework into the capital update framework.
In the absence of reliable estimates of the proportions of the overall
annual intensity increases that are due, respectively, to ineffective
practice
[[Page 45826]]
patterns and to the combination of quality-enhancing new technologies
and within-DRG complexity, we proposed to assume, as in the revised
operating update framework, that one-half of the annual increase is due
to each of these factors. The proposed capital update framework would
thus provide an add-on to the input price index rate of increase of
one-half of the estimated annual increase in intensity to allow for
within-DRG severity increases and the adoption of quality-enhancing
technology.
Comment: Several commenters objected that we derive the estimate of
allowable intensity as a function of observed intensity, so that any
level of intensity is presumptively 100 percent too high.
Response: Our analysis does derive allowable intensity from
observed intensity. However, we do not believe that doing so involves
an assumption that any level of intensity increase is 100 percent too
high. In our analysis, and in determining the level of the intensity
adjustment in the framework, we assume that half of observed intensity
is due to the combination of quality-enhancing new technology and
within-DRG complexity, and half to ineffective practice patterns. We
adopted this assumption in the absence of any estimates of the
comparative contributions of those factors to the observed level of
intensity increases. Under such circumstances, we believe the
assumption that half of observed intensity is allowable to be
reasonable because it minimizes error.
We have decided to adopt the intensity measure as proposed. For FY
1996, we have developed a Medicare-specific intensity measure based on
a 5-year average using FY 1990-1994. In determining case-mix constant
intensity, we found that observed case-mix increase was 2.2 percent in
FY 1990, 2.8 percent in FY 1991, 1.5 percent in FY 1992, 0.8 percent in
FY 1993, and 0.8 percent in FY 1994. For FY 1990 through FY 1992, we
estimate that 1.0 to 1.4 percent of the case-mix increase was real.
(This estimate is supported by past studies of case-mix change by the
RAND Corporation. The most recent study was ``Has DRG Creep Crept Up?
Decomposing the Case Mix Index Change Between 1987 and 1988'' by G.M.
Carter, J.P. Newhouse, and D.A. Relles, R-4098-HCFA/ProPAC (1991). The
study suggested that real case-mix change was not dependent on total
change, but was rather a fairly steady 1.0 to 1.5 percent per year. We
use 1.4 percent as the upper bound because the RAND study did not take
into account that hospitals may have induced doctors to document
medical records more completely in order to improve payment.) We
assumed that all of the observed case-mix increase of 0.9 percent for
FY 1993 and 0.8 percent for FY 1994 was real. (This assumption is
consistent with the FY 1996 CMI projections described above.) If we
assume that real case-mix increase was 1.0 percent per year during FY
1990 through FY 1992 (but 0.9 percent in FY 1993 and 0.8 percent in FY
1994), case-mix constant intensity declined by an average 1.2 percent
during FY 1990 through FY 1994, for a cumulative decrease of 6.1
percent. If we assume that real case-mix increase was 1.4 percent per
year during FY 1990 through FY 1992 (but 0.9 percent in FY 1993 and 0.8
percent in FY 1994), case-mix constant intensity declined by an average
1.5 percent during FY 1990 through FY 1994, for a cumulative decrease
of 7.2 percent. Since we estimate that intensity has declined during
the FY 1990-1994 period, the intensity adjustment for FY 1996 is 0.0
percent.
In our discussion of a possible efficiency adjustment, we suggested
that such an adjustment should take into account two considerations.
One is that capital inputs, unlike operating inputs, are generally
fixed in the short run. The productivity target in the revised
operating framework operates on a short-term, year-to-year basis.
Targets for capital efficiency and cost-effectiveness, however, must
operate on a longer term basis. The other consideration is that, prior
to the adoption of the capital prospective payment system, Medicare
payment policy for capital-related costs, as well as the policies of
other payers, did not provide sufficient incentives for efficient and
cost-effective capital spending. Economic theory suggests that an
industry with a guaranteed return on capital (such as the hospital
industry prior to prospective payment for capital-related costs) would
have a tendency to be overly capitalized relative to more competitive
industries. This is because the incentive for firms in such an industry
is to compete on the basis of more capital-intensive production
processes than firms in other industries. As a result, capital costs
per case, and therefore base year prospective capital rates, may be
higher than would have been consistent with capital acquisition policy
in more efficiency-oriented markets. A guiding principle in devising an
efficiency adjustment is therefore that Medicare capital prospective
payment rates should not provide for maintenance of capital in excess
of the level that would be produced in an efficiency-oriented
competitive market.
To examine this issue, we analyzed the change in actual Medicare
capital cost per case for FY 1986 through FY 1992 in relation to the
change in the capital input price index (which accounts for change in
the input prices for capital-related costs), and the other adjustment
factors that we were then proposing to include in the framework. (The
other adjustment factors are the increase in real case mix and the
increase in intensity due to quality-enhancing technological change and
within-DRG complexity.) We found rates of increase in actual spending
per case that exceeded the rate of increase attributable to inflation
in capital input prices, quality-enhancing intensity increases, and
real case-mix growth.
Our analysis was designed to examine whether hospitals had in fact
responded to the incentives of the cost-based payment system for
capital by expanding beyond what was necessary for efficient and cost-
effective delivery of services. The analysis confirmed that volume and
intensity of capital acquisition far outpaced the increase in capital
input prices during the years between the implementation of the
prospective payment system for operating costs and the introduction of
the capital prospective payment system. Even accounting for real CMI
increases and increases in intensity attributable to cost-increasing
but quality-enhancing new technologies, there remains a large excess of
capital-related spending.
The following table shows the results of our most recent analysis,
based on the most current data available and the most recent
projections. Differences between this table and the tables in previous
discussions in the Federal Register reflect updated figures for average
capital cost per case increases, based on the most recent data and
projections, and our revised CIPI. This analysis encompasses all but 1
year of the period from the implementation of the prospective payment
system for operating costs to the implementation of the prospective
payment system for capital costs. (For FY 1984, sufficient data is not
available to compute capital cost per case increases and intensity
increases.) The results of the analysis in Table 6 are substantially
similar to the results of previous analyses. In Table 6, real case-mix
increase is assumed to be 1.0 percent annually.
[[Page 45827]]
Table 6.--Cumulative Percentage Change in Capital-Related Cost per Case Due to Inflation, Real CMI, and
Intensity, 1985-1992
----------------------------------------------------------------------------------------------------------------
Percent
Year CIPI \1\ Real CMI Allowable Resulting change cost/ Residual
\2\ intensity increase case \5\ \6\
------------------------------------------------------------------\3\----------\4\------------------------------
1985............................... 5.1 1.0 3.7 10.1 12.5 2.2
1986............................... 3.7 1.0 2.1 6.9 19.9 12.2
1987............................... 3.1 1.0 2.5 6.7 14.9 7.6
1988............................... 3.0 1.0 1.5 5.5 7.1 1.5
1989............................... 2.7 1.0 0.5 4.3 7.8 3.4
1990............................... 2.4 1.0 0.2 3.6 6.9 3.1
1991............................... 2.1 1.0 0.1 3.2 5.5 2.3
1992............................... 1.7 1.0 0.1 2.8 4.6 1.8
Cumulative (compounded)............ .......... .......... ............ 52.0 111.3 39.0
----------------------------------------------------------------------------------------------------------------
\1\ Figures from Table 1, section V.A.3 of this preamble.
\2\ Assuming that real CMI increase is 1.0 percent annually.
\3\ One half of observed intensity increase, as determined by the joint operating/capital intensity measure.
\4\ The increase attributable to inflation, real CMI, and allowable intensity, calculated as the product of the
rates of increase of those factors (that is, 1.031 x 1.01 x 1.025 = 1.067 for 1987).
\5\ Figures supplied by HCFA's Office of the Actuary.
\6\ The actual increase in average cost per case divided by the increase attributable to inflation, real CMI,
and allowable intensity (that is, 1.149 /1.067 = 1.076, a 7.6 percent residual for 1987).
We believe that an adjustment for capital efficiency and cost-
effectiveness should take into account the efficiency and effectiveness
of the capital resources present in the base year for the capital
prospective payment system. We do not believe that Medicare capital
payment rates should provide for maintenance of capital in excess of
the level that would be produced in an efficiency-oriented competitive
market. A capital efficiency adjustment should be designed to give
hospitals an incentive to reduce inefficiency and ineffectiveness in
capital resources. The analysis in Table 6 suggests that, in order to
restore the Federal rate to the level at which it would have been if
capital costs had not been excessive in the years before the
implementation of capital prospective payment, a cumulative reduction
in the rate of as much as 28.1 percent (1.52/2.113=0.7194, or -28.1
percent) would be necessary.
We stated in the proposed rule that we were considering a range of
options for such an efficiency adjustment. In particular, we have
considered whether to provide, in the design of such an adjustment, for
eventually reducing the rate by the entire 28.1 percent suggested by
the above analysis. Alternatively, the eventual reduction to the rate
could reflect some part, but not all, of the excess of actual capital
cost increases over the identified factors. We have also considered the
appropriate rate at which an adjustment based on the above analysis
should be applied to the update factors. On the assumption that the
updates to the rate should be reduced by the full 28.1 percent, such an
adjustment could be accomplished over a shorter or longer period of
time. For example, HCFA could adjust the updates to the rate over a
period of 20 years at the rate of 1.4 percent per year. Similarly, the
adjustment could be made over 5 years at the rate of 5.6 percent per
year.
We proposed that HCFA have the discretion to apply an efficiency
adjustment to the capital input price rate of change in determining the
annual update factor. We invited comment on the advisability of such an
adjustment, on the proportion of the residual that should be employed
in adjustments to the update, and on the rate at which such an
adjustment should be applied. We also solicited information on possible
sources of data that would be useful in developing or refining such an
adjustment, and on the possible effects of such an adjustment on
various segments of the hospital industry.
Comment: Many commenters objected to a possible efficiency
adjustment. Several commenters asserted that such an adjustment would
be punitive because it would inappropriately punish hospitals for
behavior in response to the incentives of the cost-based system. One of
those commenters recommended that HCFA adopt positive incentives to
motivate future behavior rather than an adjustment based on past
behavior.
Response: We do not believe that an efficiency adjustment based on
the analysis we have presented would necessarily be punitive. Hospitals
received reasonable cost payments based on the costs we examined during
the period just prior to the introduction of prospective payment for
capital. We believe that the capital rates should not permanently
reflect a level of cost in excess of an efficient use of capital
inputs. However, we also believe that an adjustment to return the rates
to a level reflecting greater efficiency in capital resources should
not necessarily involve a drastic and precipitous reduction of the
rates. We note for example, that with the expiration in FY 1996 of the
requirement that capital prospective payments equal 90 percent of what
would have been payable on a reasonable cost basis, the Federal rate is
projected to increase by 22.59 percent. Thus, a substantial efficiency
adjustment could be made without a net reduction in the Federal rate.
Comment: One commenter objected that the assumptions behind the
analysis were not identified. Other commenters argued the analysis
behind the proposed adjustment did not sufficiently account for the
costs of quality improvements and other factors such as the need for
design changes and features that attract patients. Several commenters
objected that the analysis provided no empirical evidence that
inefficiency accounts for capital expenses in excess of the expected
levels.
Response: We attempted to explain all the assumptions behind our
analysis. The basic assumption, which derives from economic theory, is
simply that cost-based payment for capital, or any input, provides an
incentive for the use of inefficiently high levels of that input. We
also presented the available empirical data concerning capital cost per
case increases during the period prior to the introduction of
prospective payment for capital. The result of comparing actual capital
cost increases during that period with the identifiable factors that
contribute to cost increases, is consistent with that assumption: Cost
[[Page 45828]]
increases exceeded the level that can be accounted for on the basis of
price increases, intensity increases, and case-mix increases. We
believe the factors that we have identified already account for quality
increases, design changes, and the other factors mentioned by
commenters. Our intensity measure, for example, accounts for any factor
that affects the level of hospital charges. Presumably, hospitals
account for the costs, including quality improvements and design
changes to attract patients, that they face when they set the level of
charges. As we discuss below, a large residual remains even when we
allow for all the measured intensity changes during the period we
examined. We believe that this analysis is certainly suggestive of a
significant measure of inefficiency in capital costs in the pre-
prospective payment period.
Comment: Several commenters from states with certificate of need
(CON) requirements argued that those requirements prevent inefficient
capital purchases.
Response: Our analysis was based on national figures, and it did
not consider regional differences, such as the existence of CON
requirements in various States, since we are evaluating an efficiency
adjustment in the Federal rate.
Comment: Several commenters objected that rate reductions of the
size contemplated in the discussion of a possible efficiency adjustment
would jeopardize the ability of many hospitals to meet obligations
entered under the existing rate levels. One commenter objected that the
proposed 27.7 percent reduction in capital payments would have a
devastating impact on hospitals.
Response: We did not suggest that capital payments would be reduced
by 27.7 percent. Our proposal, in fact, called for a 20.5 percent
increase in payments in FY 1996 compared to FY 1995. We did suggest
that the rate of increase in the rates, and hence in payments, might
appropriately be reduced by an adjustment to account for inefficiency
in the level of costs on which the rates were based.
Comment: One commenter contended that the prospective payment
system already has sufficient measures to promote efficiency and
restrain the growth in capital expenditure.
Response: We agree that there are substantial incentives under the
capital prospective payment system to promote efficiency and to
restrain the growth of capital expenditures. However, the existence of
these incentives does not resolve the problem that motivated our
discussion of a possible efficiency adjustment. That problem is that
the level of the capital prospective rates may reflect an inefficiently
high level of capital costs. We do believe that the rates should not
permanently reflect a level of capital costs in excess of an efficient
use of capital inputs.
Comment: Several commenters objected that the estimate of
inefficiency partially derives ``efficient'' capital growth due to
allowable intensity as a function of observed intensity, so that any
level of intensity is presumptively 100 percent too high.
Response: Our analysis does derive allowable intensity from
observed intensity. However, we do not believe that doing so involves
an assumption that any level of intensity increase is 100 percent too
high. In our analysis, and in determining the level of the intensity
adjustment in the framework, we assume that half of observed intensity
is due to the combination of quality-enhancing new technology and
within-DRG complexity, and half to ineffective practice patterns. We
adopted this assumption in the absence of any estimates of the
comparative contributions of those factors to the observed level
intensity increases. This assumption does not undermine the validity of
our analysis of capital cost increases before the introduction of the
capital prospective payment system. On the contrary, varying our
assumption about the level of allowable intensity increases yields
substantially the same result. If we allow 100 percent of observed
intensity increases, there remains a residual of 25.7 percent, as the
following table shows:
Table 7.--Cumulative Percentage Change in Capital-Related Cost per Case Due to Inflation, Real CMI, and
Intensity, 1985-1992
----------------------------------------------------------------------------------------------------------------
Percent
Year CIPI \1\ Real CMI Allowable Resulting change cost/ Residual
\2\ intensity increase case \5\ \6\
------------------------------------------------------------------\3\----------\4\------------------------------
1985............................... 5.1 1.0 7.4 14.0 12.5 -1.3
1986............................... 3.7 1.0 4.1 9.0 19.9 10.0
1987............................... 3.1 1.0 5.0 9.3 14.9 5.1
1988............................... 3.0 1.0 2.9 7.0 7.1 0.1
1989............................... 2.7 1.0 1.0 4.8 7.8 2.9
1990............................... 2.4 1.0 0.4 3.8 6.9 2.9
1991............................... 2.1 1.0 0.1 3.2 5.5 2.3
1992............................... 1.7 1.0 0.2 2.9 4.6 1.7
Cumulative (compounded)............ .......... .......... ............ 68.0 111.3 25.7
----------------------------------------------------------------------------------------------------------------
\1\ Figures from Table 1, section V.A.3 of this preamble.
\2\ Assuming that real CMI increase is 1.0 percent annually.
\3\ Total observed intensity increase, as determined by the joint operating/capital intensity measure.
\4\ The increase attributable to inflation, real CMI, and allowable intensity, calculated as the product of the
rates of increase of those factors (that is, 1.031 x 1.01 x 1.05 = 1.093 for 1987).
\5\ Figures supplied by HCFA's Office of the Actuary.
\6\ The actual increase in average cost per case divided by the increase attributable to inflation, real CMI,
and allowable intensity (that is, 1.149/1.093 = 1.051, a 5.1 percent residual for 1987).
Therefore, even under the assumption that all intensity increases
are allowable, this analysis suggests that, in order to restore the
Federal rate to the level at which it would have been if capital costs
had not been excessive in the years before the implementation of
capital prospective payment, a cumulative reduction in the rate of as
much as 20.5 percent (1.68/2.113=0.7951, or -20.5 percent) would be
necessary.
Comment: One commenter denied that cost-based payment for capital
would influence the decision to purchase capital assets. According to
the commenter, the decision to add capital resources is driven
primarily by patient care needs, and not by the availability of
additional reimbursement. At the same time, the
[[Page 45829]]
commenter asserted that low payment rates for capital often force
hospitals to defer needed capital investments.
Response: The commenter's assertion that cost-based payment would
not influence the decision to purchase capital assets is inconsistent
with widely accepted economic theory. Several other commenters, in
fact, agreed that economic theory does suggest incentives for overuse
of capital under cost-based reimbursement.
Comment: Several commenters agreed that economic theory would
suggest incentives for the overuse of capital during a period in which
capital was paid on a cost basis while operating costs were paid on the
basis of a prospective rate. However, the commenters contended that
economic theory would also suggest that, if hospitals overpurchased
capital, they conversely had to underemploy operating inputs. As a
result, the commenters believe that reductions to the capital Federal
rate to account for the inefficient overuse of capital should be
matched by increases in the operating rates to account for inefficient
underutilization of operating inputs.
Response: We agree with the commenters that the conjunction of
rate-based payment for operating costs and cost-based payment for
capital encouraged hospitals to substitute capital inputs for labor and
other operating inputs. However, we do not agree that an inefficiently
high level of capital inputs under those conditions necessarily implies
an inefficiently low level of operating inputs. Rather, the conjunction
of rate-based payment for operating costs and cost-based payment for
capital could also lead to the substitution of inefficient capital
inputs for inefficient operating inputs. Indeed, our previous analysis
of efficient operating costs for hospitals during FY 1985 through FY
1991 (57 FR 40014), indicates that operating prospective payments
during that period were sufficient for the efficient and cost-effective
delivery of quality care. In conjunction with the analysis of capital
spending during FY 1985 to FY 1992, these results suggest that
hospitals may indeed have responded to the existing incentives by
substituting an inefficiently high level of capital inputs for
inefficient operating inputs. Under these circumstances, it would not
be appropriate to increase operating rates in conjunction with a
decrease in capital rates. Decreased capital rates, along with the
existing level of operating rates, would provide the appropriate
incentives for hospitals to achieve efficient levels of both capital
and operating inputs.
Comment: One commenter objected that it is inappropriate to
evaluate hospital behavior during a period of cost-based reimbursement
for capital on the basis of standards characteristic of a more
efficiency-oriented market system. Prior to the capital prospective
payment system, hospitals operated within a system that did not reward
efficiency. Providers should not be penalized by reducing future rates
to account for their response to poor incentives in the past.
Response: We understand the commenter's concern about the use of a
retrospective standard. At the same time, we do not believe that the
Medicare program should necessarily base payments permanently on rates
that reflect a known level of inefficiency in the use of capital
inputs. We believe a solution that is fair both to hospitals and to the
Medicare program can be found within the available range of options. As
we have stated, an efficiency adjustment need not remove all the
identified residual from the rates, nor need it do so precipitously.
Comment: One commenter argued that, since capital expenditures are
associated with binding legal contracts that fix payments for capital
assets, hospitals would actually be forced to reduce costs in areas
other than capital in response to reductions in capital rates. The
result, according to the commenter, would not be capital efficiency,
but inefficiently low levels of spending in other areas. In addition,
the commenter contended that rate reductions would result in
inefficiencies on the capital side as hospitals delayed needed capital
improvements.
Response: Implementation of an inefficiency adjustment would not
necessarily produce an actual decrease in Medicare payments for
capital. Rather, an efficiency adjustment could be implemented
gradually so that the rate of increase in the rates and payments is
reduced. Under those circumstances, the consequences that the commenter
describes would not arise.
Comment: Several commenters suggested that the excess of actual
capital costs over the levels accounted for in our analysis may be the
result of substitution of debt financing for equity. Such substitution
may have occurred as a response to negative margins under the
prospective payment system. Debt financing may have increased capital
costs, and the commenters urged that we test this possibility
empirically.
Response: Cost report data (along with data from other sources)
suggest that hospitals steadily have financed approximately 80 percent
of their capital acquisitions by debt, and the remaining 20 percent by
equity. We have seen no evidence that these proportions have been
changing in recent years. We will continue to monitor the data,
however.
Comment: ProPAC expressed concern about implementing a retroactive
standard of efficient capital spending, and about the absence of a
widely accepted definition of hospital efficiency.
Response: We recognize that there is not a widely accepted
definition of hospital efficiency. However, we believe that the
analysis we have presented suggests a significant measure of
inefficiency in capital costs in the pre-prospective payment period.
Nevertheless, we have decided not to implement an efficiency adjustment
at this time. We will, however, continue to study the issue and attempt
to refine the analysis we have presented. We continue to believe that
an adjustment for capital efficiency, parallel to the productivity
adjustment employed in the operating framework, would be an appropriate
feature of the capital framework.
6. FY 1996 Update Factor
Table 8 summarizes HCFA's FY 1996 update factor under the framework
adopted in this final rule, in comparison with the recommendation of
ProPAC.
In its March 1995 report to Congress ProPAC recommended a 4.1
percent update for FY 1996. Based on more recent projections, ProPAC's
recommended update would be 2.9 percent. On the basis of the
projections and data available for this final rule, HCFA's update is
1.2 percent. As Table 5 shows, the different update methodologies
adopted by ProPAC and HCFA, respectively, can be expected to result in
higher ProPAC update recommendations during some years, and higher HCFA
update recommendations during other years.
[[Page 45830]]
Table 8.--HCFA's FY 1996 Update Factor and ProPAC's Recommendations
------------------------------------------------------------------------
HCFA update ProPAC
factor recommendation
------------------------------------------------------------------------
Capital input price index......... 1.5 2.9
Policy adjustment factors:
Productivity.................. ................. (\1\)
Efficiency.................... (\2\) .................
Intensity:........................ 0.0 .................
Science and technology........ ................. (\1\)
Intensity..................... ................. (\3\)
Real within DRG change........ ................. (\4\)
-------------------------------------
Subtotal.................. 0.0 0.0
Case mix adjustment factors:
Projected case Mix change..... -0.8 -1.0
Real across DRG change........ 0.8 0.8
Real within DRG change........ (\5\) 0.2
-------------------------------------
Subtotal.................. 0.0 0.0
Effect of FY 1994 reclassification
and recalibration................ -0.3 .................
Forecast error correction......... 0.0 0.0
-------------------------------------
Total update.............. 1.2 2.9
------------------------------------------------------------------------
\1\ Adjustments for scientific and technological advance and
productivity offset each other. No specific values were recommended.
\2\ Efficiency adjustment may be adopted after public comment.
\3\ Included in ProPAC's Productivity Measure.
\4\ Included in ProPAC's Case Mix Adjustment.
\5\ Included in HCFA'S Intensity Factor.
7. Possible Adjustments to the Federal Rate and the Hospital-Specific
Rates
In the June 2, 1995 proposed rule, we discussed the effects of the
expiration of the statutory budget neutrality provision on rates and
aggregate payments under the capital-prospective payment system. Under
that provision, we set the capital-prospective payment system rates
during FY 1992 through FY 1995 so that payments would equal 90 percent
of estimated Medicare payments that would have been made on a
reasonable cost basis for the fiscal year. As a result of the
provision's expiration, both the capital-prospective payment system
rates and payments under the transition system will increase
significantly. The proposed FY 1996 Federal rate was 21.3 percent
higher than the FY 1995 Federal rate. We estimated that payments under
the proposed rule would increase by 20.45 percent in FY 1996 compared
to FY 1995, and that FY 1996 payments would exceed projected FY 1996
Medicare hospital inpatient capital costs by 4.52 percent.
In the proposed rule, we presented a discussion of possible
revisions to the capital-prospective payment rates that would moderate
these substantial increases in payments. These revisions could be made
in conjunction with, or in place of, an update framework adjustment to
account for possible inefficiency in capital spending prior to the
capital-prospective payment system base period. While these possible
revisions to the rate are not, strictly speaking, elements of the
update framework, we presented them within the context of the proposed
update framework in order to allow commenters the opportunity to
consider all the possible rate revisions that might affect the future
levels of rates and payments. We solicited comment on whether to make
any of the possible revisions that we discussed. We expressed our
belief that reductions in Medicare spending should be addressed in the
context of health care reform.
Under Sec. 412.308 of the regulations, HCFA determined the standard
Federal rate, which is used to determine the Federal rate for each
fiscal year, on the basis of an estimate of the FY 1992 national
average Medicare capital cost per discharge. The FY 1992 national
average Medicare capital cost per discharge was estimated by updating
the FY 1989 national average Medicare capital cost per discharge by the
estimated increase in Medicare inpatient capital cost per discharge. As
we discussed in the August 30, 1991 capital prospective payment system
final rule (56 FR 43366-43384), HCFA used the July 1991 update of HCRIS
data to estimate an FY 1989 national average Medicare cost per case of
$527.22. HCFA then updated that amount to FY 1992 by using an actuarial
projection of a 31.3 percent increase in Medicare capital cost per
discharge from FY 1989 to FY 1992. The standard Federal rate was thus
based on an estimated FY 1992 national average Medicare capital cost
per discharge of $692.24 (before the application of a transfer
adjustment and a payment parameter adjustment).
Section 13501(a)(3) of Public Law 103-66 amended section
1886(g)(1)(A) of the Social Security Act to require that, for
discharges occurring after September 30, 1993, the unadjusted standard
Federal rate be reduced by 7.4 percent. As we discussed in the
September 1, 1993 final rule for FY 1994 (58 FR 46316), the purpose of
that reduction was to reflect revised inflation forecasts, as of May
1993, for the increases in Medicare capital cost per discharge during
FY 1989 through FY 1992. By that time, the estimate of increases in
Medicare inpatient capital costs per discharge from FY 1989 through FY
1992 had declined from 31.3 percent to 21.57 percent. The 7.4 percent
reduction to the Federal rate was calculated to account for these
revised forecasts (1.2157/1.313=.926, a 7.4 percent decrease). That
provision of Public Law 103-66 also required that, for cost reporting
periods beginning on or after October 1, 1993, the Secretary
redetermine which hospital payment methodology should be applied under
the capital prospective payment system transition rules to take into
account the 7.4 percent reduction to the Federal rate.
As a result of the reduction required by Public 103-66, the
standard Federal rate is now based on an estimated FY 1992 Medicare
inpatient capital cost per case of $641.01 ($692.24 x 0.926). At the
[[Page 45831]]
time of the Public Law 103-66 reduction to the Federal rate, actual
cost report data on the FY 1992 Medicare capital cost per discharge
were not yet available. The reduction was based on cost report data for
FY 1990 and FY 1991, and a revised projection of the rate of increase
in Medicare capital costs per discharge during FY 1992.
We now have extensive cost report data for FY 1992. The December
1994 update of HCRIS data showed an audit-adjusted FY 1992 Medicare
inpatient capital cost per discharge of $593.15, or 7.47 percent lower
than the estimate (reflecting the 7.4 percent reduction mandated by
Public Law 103-66) on which the Federal rate is currently based. We do
not believe that the Federal rate should necessarily remain at a level
that reflects a known over-estimation of base year costs. We therefore
invited comment on the appropriateness of an estimated 7.47 percent
reduction to the unadjusted standard Federal rate to account for that
over-estimation. (The June 1995 update of HCRIS data shows an audit-
adjusted FY 1992 Medicare inpatient capital cost per discharge of
$596.28, or 6.98 percent lower than the estimate on which the Federal
rate is currently based.)
Under Sec. 412.328, HCFA determined the FY 1992 hospital-specific
rate by using a process similar to the process for determining the FY
1992 Federal rate. The intermediary determined each hospital's
allowable Medicare inpatient capital cost per discharge for the
hospital's latest cost reporting period ending on or before December
31, 1990. The intermediary then updated each hospital's FY 1990
allowable Medicare capital cost per discharge to FY 1992 based on the
estimated increase in Medicare inpatient capital cost per case. As in
the case with the Federal rate updates, current data demonstrate that
the estimates used to update the hospital specific rates from FY 1990
to FY 1992 were overstated. On the basis of the data available in the
proposed rule, we indicated that we were also considering whether to
correct for the original rate of increase estimates by prospectively
decreasing the hospital-specific rates by 8.27 percent. Such a
reduction would not apply to hospital-specific rates that have been
redetermined for a later cost reporting period. This is because the
rate of increase estimates were not employed for redeterminations after
FY 1992.
Finally, we suggested that the analysis of capital cost increases
prior to the implementation of the prospective payment system for
capital-related costs could be the basis for an immediate adjustment to
the Federal rate to compensate for the effects of the expiration of
budget neutrality. At the time of the proposed rule, the available data
suggested that a reduction to the Federal rate of up to 27.7 percent
would be necessary to restore the rate to the level at which it would
have been if capital costs had not exceeded the level that can be
accounted for on the basis of known factors. (As discussed in section
V.A.5 above, the current data suggest that a reduction of up to 28.1
percent would be necessary to restore the Federal rate to that level.)
Such an adjustment could be accomplished gradually over a number of
years within the context of the update framework. We suggested in the
proposed rule that some large part of the residual could be removed
from the rate in a single adjustment. For example, we suggested that
retaining the FY 1995 budget neutrality adjustment of 0.8432 in the
standard Federal rate would have the effect of recapturing a large part
of the residual of capital cost increase over the identifiable factors.
The remainder of the residual, if appropriate, could be removed from
the rate on a gradual basis through an adjustment to the update factor,
as discussed in section V.A.6 above. We therefore requested comments on
the appropriateness of such measures, particularly on the
appropriateness of retaining the FY 1995 budget neutrality adjustment
in the rate as an efficiency measure.
Comment: Many commenters objected to possible measures to reduce
the Federal rate. Some commenters contended that the error in
forecasting the FY 1992 cost per case likely resulted from a
substantial decline in the rate of growth in capital expenditures as
hospitals anticipated the introduction of prospective payment for
capital. Under these circumstances, the commenters contended, reduction
to the rates would punish providers for responding to the new
incentives of prospective payment.
Response: Current cost report data show a modest decline in the
rate of increase in Medicare capital cost per case immediately before
the introduction of the capital prospective payment system. (See Table
6 above.) From the information at our disposal, however, it is
impossible to determine the degree to which this modest decline is due
to behavioral changes induced by anticipation of prospective payment
for capital as opposed to other factors. For example, during the last
years under reasonable cost payment, the payment for capital costs was
discounted; that is, the program paid 85 percent of Medicare capital
costs. It is likely that the discounting of reasonable cost payment
contributed to the modest decrease in the rate of increase in capital
cost during that time. In any event, we intended to base the Federal
capital rate on the FY 1992 Medicare capital cost per case. We do not
believe it is reasonable to expect that the rate permanently reflect
the level of cost that would have existed if the poor incentives that
existed prior to the implementation of capital prospective payment had
remained in place.
Comment: Other commenters contended that continued retrospective
lookbacks to FY 1992 are inappropriate in a prospective payment system.
Response: The core notion of prospective payment is that the
payment rate be set in advance of the actual payment. None of the
measures that we discussed would violate that principle. In each case,
rate revisions would apply prospectively, that is, only to payments in
the future. Under a prospective system, prior period rates are the
basis for determining rates in subsequent years. However, we believe
that future rates should not be based permanently on initial estimates
that we now know to be incorrect. Our intention was always to base the
capital rates on FY 1992 costs per case. At the time of the final rule
establishing the prospective payment system for capital-related costs,
we estimated FY 1992 costs on the basis of the best data and
projections then available.
Comment: Several commenters argued that retaining the FY 1995
budget neutrality adjustment in the rate would disadvantage hospitals
after they have responded to the incentives under the capital
prospective payment system.
Response: The purpose of retaining the FY 1995 budget neutrality
adjustment in the rate would be to address a known overestimation in
the costs used to establish the rate, and possibly excessive costs that
may be inappropriate to include permanently in the rate. While it is
true that hospitals should be able to gain from responding to the
incentives of prospective payment, it does not follow that this should
include permanent benefit from excessively high rate levels.
Comment: Several commenters contended that it would be illegal for
HCFA to retain the FY 1995 budget neutrality adjustment in the base
rate. These commenters observed that Congress mandated the sunset of
budget neutrality for capital, and asserted that retaining the budget
neutrality adjustment in the rate was a covert way of attempting to
extend the provision beyond the statutory sunset.
Response: The purpose of the measure we discussed would not be to
extend the budget neutrality provision. Rather
[[Page 45832]]
it would be to set the rate at an appropriate level in the light of
information that is now available concerning cost increases in the
years up to and including FY 1992. Retaining the budget neutrality
adjustment factor would simultaneously address our original
overestimation of FY 1992 costs and some significant proportion of the
inefficiency represented in the FY 1992 cost per case. The use of the
FY 1995 budget neutrality adjustment factor would merely accomplish a
major rate revision in a manner that provides substantial stability in
the level of payments. As such, the adjustment would not be a budget
neutrality adjustment per se, but rather an adjustment to address past
estimates. Section 1886(g) of the Social Security Act confers broad
authority on the Secretary to establish a prospective payment system
for capital-related costs.
Comment: A number of commenters contended that the reductions
discussed in the proposed rule would jeopardize the ability of many
hospitals to meet current obligations and reduce their ability to meet
future capital needs.
Response: The measures discussed in the proposed rule would not
necessarily result in actual reductions in capital payments compared to
the level of FY 1995. For example, the reduction to account for the
overestimation of FY 1992 costs per case would still allow annual
increases in rates and payments of over 10 percent in FY 1996, and
approximately 3 to 5 percent per year through the rest of the
transition.
Comment: One hospital association observed that Congress may choose
to enact one or more of the measures discussed in the proposed rule.
The commenter suggested that any measures to reduce the growth of
Medicare expenditures would create the need for HCFA to increase the
protections for hospitals that undertake major capital projects during
the transition period to fully prospective capital payment. The
commenter emphasized that its recommendation was budget neutral.
Response: We do not yet know what if any action Congress will take
with respect to the capital prospective payment system. Thus, it would
be premature to consider proposals that, under a budget neutrality
provision, would involve redistribution of funds from hospitals
generally to those hospitals that might benefit from expanded
exceptions protection.
Comment: Several commenters contended that it would be illegal for
HCFA to implement any of the identified reductions to the rates
(including an efficiency adjustment). Two commenters characterized the
rate reduction options as thinly disguised attempts to rebase
hospitals' base year capital costs, and asserted that Congress has not
given the Secretary of Health and Human Services the authority to
rebase hospital capital costs. One commenter stated that the rate
revisions discussed in the proposed rule would violate a fundamental
principle of prospective payment: that the system provide certain and
predictable payment rates.
Response: Section 1886(g) of the Social Security Act requires
payment for capital-related costs under a prospective payment system
``established by the Secretary.'' (Emphasis added.) The statute
prescribes only that the system provide for payment on a per discharge
basis, employ appropriate weighting of payment rates by classification
of discharge, and reduce payments during FY 1992 through FY 1995 by an
amount estimated to equal 10 percent of what would have been paid on
the basis of reasonable costs. The statute gives the Secretary wide
discretion in determining the particular features of the system,
including the appropriate level of payment rates. We believe that any
rate revision implemented prospectively would satisfy the principle of
certainty and predictability under a prospective system.
Comment: One commenter argued that reducing the rate to account for
overestimation of FY 1992 cost per case amounts to rebasing the capital
rates from FY 1989 to FY 1992. The commenter contended that such a
measure would amount to more than a technical correction and would, in
fact, require revisiting the entire discussion that gave rise to
prospective payment for capital. Finally, the commenter objected that
there is no evidence that FY 1992 represents a typical year in capital
spending as opposed to a ``trough'' in capital expenses.
Response: The methodology that we adopted in the September 1, 1992
final rule provided for using the FY 1989 cost per case as the basis
for estimating the FY 1992 cost per case. We used FY 1989 as the basis
for estimating because it was at that time the most recent year for
which substantial cost report information was available. Thus FY 1992,
not FY 1989, has always been the base year for the rate. The issue is
not rebasing the rate but only the appropriateness of addressing
previous estimates of base year costs. We believe that the commenter's
concern about whether FY 1992 was a ``trough'' year in capital spending
is misguided. The Medicare accounting rules, which were used to
determine the capital costs on which the capital Federal rate is based,
count depreciation costs for all capital still in use and interest on
loans for depreciable assets. Current year purchases thus have only a
small effect on the accounting of capital costs for the year. Capital
costs for FY 1992 include depreciation and interest costs related to
capital purchases over many previous years. There is no evidence that
the period up to FY 1992 represented a ``trough'' in capital spending.
Comment: One commenter objected that making the rate reductions
under consideration would be inconsistent with HCFA's refusal over the
years to ``make up'' for shortfalls in actual outlier payments compared
to estimates.
Response: We believe that we have been completely consistent in our
policies regarding rate-setting and issues of revising prior year
payments under the prospective payment system. As discussed earlier, we
believe that prospective adjustments to the rates may be appropriate to
address errors in estimating base year costs that would otherwise be
built into the rates for future fiscal years. In contrast, any
difference between actual outlier payments and estimated outlier
payments are not built into the rates for future years; thus, for
example, if actual outlier payments in a fiscal year were 4.0 percent
rather than the projected 5.1 percent, the 1.1 percent difference does
not mean that prospective payment rates would be 1.1 percent lower than
if we had accurately projected outliers.
The case of the outlier offset cited by the commenter is more
analogous to the budget neutrality adjustments under the capital
prospective system than it is to the reductions to the base capital
rate that we discussed. In the cases of outliers and budget neutrality,
temporary annual adjustments to the rates have been made to meet
certain payment targets (that is, a designated percentage of outlier
payments, in the one case, and 90 percent of what would have been paid
for capital costs on a reasonable cost basis, in the other). In both
cases, we have refused to make any changes in the level of the rates or
payments during subsequent years to account for differences between
actual and estimated payments. Thus, we have not decreased subsequent
year payments to account for actual payments that have apparently
exceeded the payment target of 90 percent of estimated capital costs
under the expiring budget neutrality provision. We do, however, examine
past experience for purposes of refining the estimation methodology
used to set the outlier offsets and budget neutrality adjustments for
subsequent years.
[[Page 45833]]
As in the case of outlier payments and budget neutrality, none of
the rate changes that we discussed in the proposed rule would ``make
up'' for past payments. In making any of those revisions, we would
instead be employing better data that is now available in order to set
the permanent base rate more accurately for future years.
Comment: ProPAC commented that the large increase in rates with the
expiration of budget neutrality raises two sets of questions. First, it
raises the issue of an appropriate update mechanism, about which HCFA
and ProPAC have conducted a vigorous discussion. (See section V.A
above.) The second and perhaps more important issue is the need to
determine the appropriate base rate to which the update is to be
applied. ProPAC believes that, because updates during the first four
years of the prospective payment system were based on historical cost
increases rather than on an analytical framework reflecting current
factors, the updated payment rates grew more rapidly than estimated
reasonable costs. The result was a widening gap between the updated
base rate and the rates actually used for payment under the budget
neutrality provision. The expiration of budget neutrality thus results
in a 21 percent increase in both rates and payments. ProPAC believes
that the appropriate level of the base payment rate is an issue that
merits attention by the Secretary and Congress. The Commission
identifies several possible approaches to setting the base rate at an
appropriate level, including those identified in this year's proposed
rule. They identify one approach that we did not discuss: updating
actual FY 1992 costs to FY 1996 on the basis of an analytical
framework, rather than actual cost increases.
Response: We agree with ProPAC that the appropriate level of the
capital base payment rate is an important issue. We presented the
discussion of possible rate revisions in the proposed rule precisely in
order to initiate a discussion of that issue.
Comment: Several commenters contended that rate revisions with the
potential magnitude of those discussed in the proposed rule should not
be implemented through rulemaking. The commenters argued that proposals
of this scope should require enabling legislation.
Response: We do not believe that it would be inappropriate for
HCFA to implement rate revisions of the kind under discussion after
appropriate notice and comment rulemaking. As we have previously
stated, the statute gives the Secretary broad discretion in the design
of the system in general and in the determination of the appropriate
rate level in particular. Nevertheless, it is clear that Congress will
be considering major changes in the Medicare program, including
substantial budget savings proposals, during the coming months. Under
the circumstances, we have decided not to proceed at this time with any
possible capital rate revisions through the rulemaking process while
Congress considers whether to include any such measures within more
comprehensive legislation dealing with Medicare and the Federal budget.
B. Adjustment to the Capital Prospective Payment System Federal Rate
for Capital-Related Taxes
In our June 2, 1995 proposed rule, we discussed an adjustment to
the capital prospective payment system for capital-related tax costs.
As we noted in that discussion, such an adjustment would be designed to
remove a possible inequity in the capital prospective payment system.
While capital-related taxes constitute a cost imposed on an
identifiable group of hospitals, those costs are currently reflected in
the Federal capital rate paid to all hospitals. Since the inception of
the prospective payment system for capital-related costs, several
commenters have pointed out that all hospitals are thus being
reimbursed for costs that only some hospitals pay.
In the proposed rule, we presented a proposal for an adjustment for
capital-related tax costs. However, we noted in the proposed rule that
introducing an adjustment posed several serious problems which we had
not been able to resolve. These issues involve equity to hospitals that
may become subject to capital-related taxes in the future. They also
involve our responsibility to protect the Medicare Trust Fund from
possible manipulation as well as from any new open-ended commitments to
increase Medicare payments. We presented a formal proposal in order to
facilitate discussion of the merits of implementing a special tax
adjustment. We believed that presentation and analysis of a proposal
provided the best opportunity for a full and public discussion of all
the issues surrounding a possible adjustment for capital-related tax
costs. We presented our proposal in the hope that the process of public
comment would produce a solution that could simultaneously protect the
Trust Fund and satisfy the equity concerns of all hospitals.
In order to facilitate discussion of the issues surrounding the
treatment of capital-related taxes, we proposed to provide for a
special adjustment for the capital-related tax costs of hospitals that
paid such taxes for cost reporting periods beginning in FY 1992. The
tax costs of those hospitals were included in the computation of the
capital Federal rate. Under our proposal, hospitals that began
operation after FY 1992 would also be eligible for an adjustment. We
further proposed an adjustment of the Federal rate to offset the amount
of capital-related tax costs originally included in the computation of
the rate. In this way, adoption of the tax adjustment would be budget
neutral: Aggregate capital payments would neither increase nor decrease
merely because of the tax adjustment.
For those hospitals that would be eligible for an adjustment, we
proposed to apply a hospital-specific Medicare tax cost per discharge
amount to the Federal rate portion of each payment for each discharge
from the hospital, beginning October 1, 1995. Under our proposal, the
hospital-specific Medicare tax cost per discharge was to be determined
on the basis of the updated FY 1992 base year cost.
Some of the serious issues that arose in connection with the
implementation of a tax adjustment concern hospitals whose tax-paying
status has changed since FY 1992. Some hospitals that paid capital-
related taxes in FY 1992 may no longer be subject to such taxes (for
example, because they converted to non-proprietary status in a taxing
jurisdiction that does not tax non-proprietary hospitals). Other
hospitals may have been in operation during FY 1992, but have only
become subject to tax payments since that time, either by a change in
status (that is, from non-proprietary to proprietary) or by the action
of State or local authorities to impose capital-related taxes on
entities that had not previously been subject to such taxes.
Hospitals that subsequently become subject to taxes through the
action of State or local authorities pose the most serious issues of
equity and protection of the Trust Fund. On the one hand, it may seem
unfair to prohibit hospitals on whom a tax cost is imposed after FY
1992 from receiving an adjustment available to hospitals on whom a tax
cost was imposed in FY 1992. On the other hand, a capital Federal rate
tax adjustment should not be vulnerable to possible efforts by state or
local authorities to gain revenues from increased Medicare payments to
hospitals. Nor should a tax adjustment provide an open-ended commitment
to increase the overall level of Medicare capital payments as State and
local
[[Page 45834]]
governments extend taxation to previously tax-exempt facilities. The
capital Federal rate tax adjustment that we proposed reflected only the
FY 1992 capital-related tax costs included in the original computation
of the Federal rate. It could not reflect costs imposed on hospitals by
the extension of State and local capital-related taxes after FY 1992.
Therefore, in the absence of some additional budget neutrality
provision, extending the tax adjustment to hospitals that become
subject to capital-related taxes after FY 1992 could significantly
increase the overall level of Medicare capital payments.
We proposed that hospitals would not qualify for the adjustment if
they became subject to tax payments because of state or local action to
change tax laws (for example, by extending taxation to non-proprietary
hospitals) since FY 1992. We did so both to prevent the possibility
that State and local authorities could inappropriately gain revenues
through increased Medicare payments, and to prevent the adoption of a
tax adjustment from producing large increases in Medicare capital
payments if additional jurisdictions impose taxes on non-proprietary
hospitals. We recognized, however, that this policy might be viewed as
penalizing newly taxed hospitals for changes in circumstances over
which they have no control. We invited comment on the appropriateness
of this proposal, which raised issues of equity between hospitals
subject to capital-related taxes in FY 1992 and those newly subject to
such taxes after FY 1992. We specifically invited suggestions and
comments on other approaches to dealing with the situation of hospitals
that become subject to taxes after FY 1992. We stated our belief that
any proposal to deal with the situation of such hospitals should
protect the Medicare Trust Fund against an open-ended commitment to
increase Medicare payments in order to reimburse hospitals for
Medicare's share of newly imposed capital-related tax obligations.
In particular, we invited comment on the possibility of providing
an adjustment to such hospitals on a budget-neutral basis. Under such
an approach, an annual tax adjustment budget neutrality factor would be
applied to the Federal rate to account for the estimated cost of the
tax adjustment over and above the costs attributable to capital-related
taxes in the FY 1992 base year. In this way, aggregate payments,
including tax adjustments to hospitals that have become subject to
taxes since FY 1992, would not exceed the amount of payments in the
absence of extending the adjustment to such hospitals. Such an approach
would prevent the tax adjustment from becoming an open-ended drain on
the Medicare Trust Fund. However, such an approach necessarily involves
reducing the Federal rate beyond the level accounted for by the
capital-related tax costs originally included in the rate computation.
In other words, such a budget neutrality adjustment would reduce the
amount of other capital-related costs incorporated in the original rate
computation. Under such an approach, the reductions in payments to
hospitals that do not pay taxes would exceed the amount of capital-
related taxes included in the original rate computation; arguably,
then, this approach would inappropriately disadvantage hospitals that
do not pay capital-related taxes.
With regard to the situation of other hospitals whose tax status
has changed since FY 1992, we stated our belief that hospitals that are
no longer subject to capital-related taxes should not receive an
adjustment to their capital Federal rate payments. Therefore, we
proposed that a hospital (or a related organization) must be directly
subject to capital-related taxes in order to qualify for the capital
Federal rate tax adjustment.
In addition, we proposed that no adjustment would be made for
hospitals whose status changed from non-proprietary to proprietary
after FY 1992. The decision to change status to a proprietary hospital
is a voluntary decision of the hospital's management, and we therefore
believe that an adjustment to allow special payment for additional
taxes that result from such a decision is not warranted.
However, we also proposed that hospitals that were not in operation
in FY 1992 should be able to qualify for the adjustment. We therefore
provided that intermediaries should accept data on capital-related tax
payments from hospitals that have begun operation since FY 1992. Such
hospitals were to contact their intermediaries as soon as possible, but
in any case no later than July 31, 1995, to submit the appropriate data
and documentation.
Comment: In Opposition: We received comments opposed to the
proposed property tax adjustment from six associations representing a
large number of hospitals and from two individual providers. These
commenters were opposed to a tax adjustment for several related
reasons. Several commenters argued that tax-exempt hospitals incur
substantial costs for services they must provide to maintain tax-exempt
status. They pointed out that the Internal Revenue Code requires tax-
exempt hospitals to satisfy a community benefit standard. This standard
requires the operation of a full-time emergency room open to all
persons without regard to their ability to pay. It also requires
provision of care for every person in the community regardless of
ability to pay. The commenters asserted that costs faced by hospitals
to provide these services may be higher than property tax levels. They
objected that our proposal did not offer any special adjustment to
compensate for the cost of community benefit services.
One commenter characterized the proposal as an attempt to address a
perceived inequity for one group of hospitals that in turn creates new
inequities for many other hospitals. In particular, the commenter
objected to our suggestion that extending the adjustment to hospitals
newly subject to taxes could be financed by further reducing the
Federal rate paid to all hospitals. The commenter suggested that, in
light of the acknowledged problems in treating all hospitals equitably
in implementing an adjustment, the most equitable solution would be to
maintain the integrity of the prospective payment system by refusing to
provide special treatment for this cost.
Another commenter objected that the proposed tax adjustment would
shift payments from hospitals that exist to serve the needs of the
community to those whose primary purpose is to return a profit to its
shareholders. The commenter expressed concern that this shift could
aggravate existing access problems.
Several commenters objected to the proposal based on reasons
related to Medicare reimbursement principles. One commenter argued that
the proposed tax adjustment contradicted an established policy of the
Medicare program, that organizational decisions made by a hospital
should not affect payments. Another commenter contended that the
proposed adjustment would subsidize the decision to become a for-profit
entity. The same commenter termed the proposed adjustment a return to a
cost-based reimbursement system, and thus a retreat from the principles
of prospective payment. Another commenter contended that tinkering with
a prospective payment system to reflect a specific component of cost
may invite requests for further adjustments. One commenter specifically
requested that we provide an adjustment for capital-related interest
costs in the same manner as we proposed to adjust for capital-related
property taxes.
[[Page 45835]]
Several commenters raised questions of fairness among tax-paying
and tax-exempt providers. The commenter contends that for-profit
hospitals do not share equally in the burden of providing care to
indigent patients. Furthermore, payment reductions will affect the
ability of the non-profit hospitals to maintain current service levels
to Medicare beneficiaries.
Several commenters recommended either that we drop the proposal to
institute a capital-related property tax adjustment, or that we
introduce a tax adjustment only in conjunction with an adjustment for
the costs of charity care.
In Favor: We also received numerous comments in favor of the
proposed adjustment for capital-related property taxes. Most comments
(129) came from tax-paying proprietary hospitals who supported the tax
adjustment as proposed. Another 38 commenters supported the concept of
the proposed rule, but advocated revisions to the proposal, such as
expansion of the eligibility criteria.
Two hospital associations responded generally in favor of the
proposed adjustment, but also requested some modifications of the
proposed provisions. In particular, those commenters requested the
inclusion of hospitals that did not pay property taxes in 1992, but are
now paying property taxes. To prevent gaming, the commenters suggested
the adoption of a 3-year waiting period before hospitals newly subject
to taxes could become eligible for an adjustment. To protect the Trust
Fund, the commenters recommended that future capital rate updates be
reduced to provide the funds for extending the adjustment to hospitals
newly subject to taxes. The commenters also suggested that hospitals
should only qualify for an adjustment if they pay bona-fide taxes that
apply to all businesses in an area.
Other commenters contended that we should include taxes paid on
leased property or equipment in the adjustment, at least in cases where
the lease provided for direct payment to taxing authorities. One
commenter agreed that a level playing field exists for leases on fixed
equipment, but recommended that an adjustment be provided for taxes
paid on leased facilities. Another commenter requested that we allow an
adjustment for municipal hospitals that have city services allocated to
their facility rather than a direct property tax bill.
Two commenters pointed out that they provide charity care and
community services, as the tax-exempt hospitals do, but they must also
pay taxes.
Response: We have decided not to proceed with implementation of a
tax adjustment at this time. Two considerations motivated this
decision. First, we have not been able to resolve the problems with
implementing a tax adjustment that we identified in the proposed rule.
Those commenters in favor of an adjustment did suggest several means
for preventing gaming by states and to protect the Medicare Trust Fund
from expenditure increases. Several of the suggestions for preventing
gaming have some merit. We agree with the commenters, for example, that
requiring hospitals newly subject to taxes to wait 3 years before
qualifying for an adjustment may reduce the possibilities for gaming.
At the same time, we are concerned that some of their other
suggestions, such as the adoption of rules to determine bona fide
taxes, would prove difficult to administer. Even if these measures
could prevent gaming, however, we have not been able to determine a
method for protecting the Trust Fund that does not create possible new
inequities. Commenters in favor of a tax adjustment have suggested
reducing future rate updates by an amount sufficient to fund the
extension of adjustments to hospitals newly subject to taxes. Under
such a measure, however, hospitals that do not pay taxes would
necessarily receive lower payments than they would in the absence of a
tax adjustment. (Even some hospitals that pay taxes would receive lower
payments, if the amount of the Federal rate reduction exceeds the
amount of the hospital-specific adjustment.) If the problem that
motivated our consideration of an adjustment is an inequity, such a
measure would certainly create an inequity as well. As several
commenters noted, it would not be appropriate to proceed with a
proposal that replaces one possible inequity with another.
The second consideration in our decision not to implement a tax
adjustment at this time is that, in the light of the comments, we
believe the proposed adjustment may be incompatible with a prospective
payment system for capital-related costs. Prospective payment involves
an averaging system under which differences in costs among hospitals
are generally not accorded special treatment. Many hospitals and groups
of hospitals can cite costs which may be unique to them. Among the
commenters on the proposed adjustment, for example, some claimed that
capital-related tax costs deserve special treatment because they are
unique to one group, while others cited charity care as a unique cost
to another group of hospitals. By ignoring such differences, a
prospective system provides incentives for realizing greater efficiency
in the provision of services than can be achieved under a cost-based
payment system. Such a system is not inequitable as long as it is
consistent in rejecting special treatment for specific costs.
It is true, as the commenters in favor of a tax adjustment pointed
out, that the prospective system does provide adjustments for several
costs. For example, adjustments are provided under both the operating
and capital systems to those hospitals that have graduate medical
education programs for the costs associated with that activity.
However, the adjustment for the indirect cost of graduate medical
education (as well as the disproportionate share adjustment) ultimately
reflects a decision specifically to encourage the activity associated
with those costs. As several commenters pointed out, adoption of a tax
adjustment would have amounted to subsidizing a decision about hospital
organizational structure (that is, the choice of proprietary status).
While many nonproprietary hospitals would have qualified for a tax
adjustment, our final data showed that those hospitals would have
received, on average, a capital-related tax adjustment of $6.42 per
discharge. As a result, tax-paying nonproprietary hospitals would, on
average, have gained only slightly more from the tax adjustment than
they would have lost from the reduction to the Federal rate. This is
because the amounts that voluntary hospitals pay in taxes is relatively
small. In contrast, tax-paying proprietary hospitals would have
received, on average, a tax adjustment of $70.47 per discharge. As a
result, those hospitals would have gained much more from the adjustment
than they would have lost from the reduction to the Federal rate. A tax
adjustment would have subsidized proprietary hospitals that pay
capital-related taxes at the expense of all other groups. Therefore, we
believe that the proposed tax adjustment may not be consistent with the
principles behind prospective payment.
We recognize that many hospitals that might have benefited from the
implementation of a tax adjustment have been inconvenienced by the time
and effort required to comply with our requests for documentation of
their tax costs. Because of our decision, those hospitals will now
receive no benefit in return for complying with our requests. We regret
that it was not possible to
[[Page 45836]]
make a final determination about the merits of implementing a tax
adjustment before proceeding with data collection and verification. It
was necessary to collect and verify data on tax costs in order to
determine the dimensions of the issue before proceeding with any
proposal to make an adjustment. Without verified data, we would not
have been able to inform interested parties of the estimated size of
the change in payments for hospitals that do not pay taxes. Once we
published the proposal, it was necessary to complete data collection
and verification in order to be prepared for possible implementation of
the adjustment following comments. On the one hand, then, we could not
proceed with a proposal without data. On the other hand, we also could
not decide to implement the proposal in the final rule simply because
the data had been collected. It would be inconsistent with the
integrity of the rulemaking process to allow preparations necessary for
the possible implementation of a proposal to dictate the results of the
notice and comment process.
The issue of taking capital-related tax payments into account when
determining capital-related prospective payments is an important one in
the effort to create a payment system that is both fair and feasible.
Providers that submitted data needed in the analysis of this issue and
for the design of a payment system made an indispensable contribution
toward informing the debate, influencing the formulation of this
important public policy, and reaching the decision that the proposed
change in the capital-related prospective payment system should not be
made at this time.
As noted, we received numerous other comments about the specific
features of a possible tax adjustment. Since we have decided not to
proceed with such an adjustment, we will not respond to those comments
at this time.
VI. Changes for Hospitals and Units Excluded From the Prospective
Payment Systems
A. New Requirements for Certain Long-Term Care Hospitals Excluded From
the Prospective Payment Systems (Secs. 412.23(e))
1. Effect of Change of Ownership on Exclusion of Long-Term Care
Hospitals
As discussed in the June 2, 1995 proposed rule, some questions have
arisen as to whether a hospital's compliance with the length-of-stay
requirement for long-term care (LTC) hospitals is affected by its sale
to a new owner. After reviewing this issue, we concluded that if a
change of ownership occurs at the start of a cost reporting period, or
at any time during the 6 months immediately preceding the start of that
period, the hospital should not be required to begin a new qualifying
period. Therefore, we proposed to clarify current regulations by
specifying under Sec. 412.23(e)(2) that if a hospital undergoes a
change of ownership at the start of a cost reporting period, or at any
time within the preceding 6 months, it may be excluded from the
prospective payment system as an LTC hospital if it is otherwise
qualified and maintained an average length of stay in excess of 25
days, under both current and previous ownership, for that 6-month
period (60 FR 29244). To qualify for the exclusion, the hospital must
have been continuously in operation for all of the qualifying period
and participated continuously in Medicare as a hospital. That is,
periods during which the hospital was closed or did not participate in
Medicare could not be counted toward the required experience.
We received no public comments on this proposal and are, therefore,
adopting the regulations as proposed.
2. Revised Criterion on Purchase of Services by LTC ``Hospitals Within
Hospitals''
Recently, some entities began to organize themselves under what
they refer to as the ``hospital within a hospital'' model. Under this
model, an entity may operate in space leased from a hospital and have
most or all services furnished under arrangements by employees of the
lessor hospital. The newly organized entity may be operated by a
corporation formed and controlled by the lessor hospital, or by a third
entity that controls both. In either case, the new entity seeks State
licensure and Medicare participation as a hospital, demonstrates that
it has an average length of stay of over 25 days, and seeks to obtain
an exclusion from the prospective payment systems. As explained in the
rulemaking documents for FY 1995, we believe it would be inappropriate
to extend the LTC hospital exclusion to what is for all practical
purposes a LTC hospital unit.
To avoid granting LTC hospital exclusions inappropriately to
hospital units while still allowing adequate flexibility for legitimate
networking and sharing of services, we set forth additional exclusion
criteria for these ``hospitals within hospitals'' in our September 1,
1994 final rule (59 FR 45389-45393). These regulations provide that, in
addition to meeting the other LTC hospital exclusion requirements set
forth in Sec. 412.23, to be excluded from the prospective payment
systems, a hospital located in the same building or in one or more
entire buildings located on the same campus as another hospital must
have a separate governing body, a separate chief medical officer, a
separate medical staff, and a separate chief executive officer. These
criteria are stated in regulations at Secs. 412.23(e)(3)(i)(A) through
412.23(e)(3)(i)(D). In addition, the hospital must either perform most
basic hospital functions without any assistance from the hospital with
which it shares space (or from a third entity that controls both)
(Sec. 412.23(e)(3)(i)(E)) or receive at least 75 percent of its
inpatient referrals from a source other than the other hospital during
the period used to demonstrate compliance with the length-of-stay
criterion (Sec. 412.23(e)(3)(ii)). The criterion under
Sec. 412.23(e)(3)(i)(E) does permit a hospital seeking exclusion to
obtain certain services from a hospital occupying space in the same
building, including food and dietetic services and housekeeping,
maintenance, and other services necessary to maintain a clean and safe
physical environment.
Since publication of the September 1, 1994 final rule, hospital
representatives have stated that there are some situations in which
basic hospital services other than those related to dietetic,
housekeeping and maintenance functions could be furnished in a more
cost-effective manner, or more conveniently for patients, if they were
provided by the hospital in which the LTC hospital is located. As
discussed in the June 2, 1995 proposed rule, we recognize the need to
allow LTC hospitals within hospitals greater discretion to purchase
services like these from their ``host'' facilities, when it is done in
a cost-effective and convenient way. However, it is also important that
the LTC hospital exclusion criteria be clear and definite enough to
limit LTC exclusions to bona fide separate hospitals. To balance these
competing objectives, we proposed to revise the exclusion criteria to
describe the scope of services that can be obtained from the host
hospital in financial terms, rather than by type of service (60 FR
29244).
Under our proposal, an otherwise qualified hospital could obtain a
LTC hospital exclusion if the operating cost of services that it
furnishes directly or obtains from a source other than the hospital
with which it shares a building or campus (or from a third entity which
controls both hospitals) constitutes at least 85 percent of its total
inpatient operating costs. This test would be applied with respect to
the cost
[[Page 45837]]
reporting period or other time period used to establish the hospital's
compliance with the length of stay criterion. (If a period other than a
full cost reporting period is used, the LTC hospital must provide HCFA
with verifiable information on its costs for that part of the period.)
We proposed a criterion of 85 percent of total inpatient operating
costs as an appropriate test of separateness based on the level of
dietetic, housekeeping, and maintenance expenses incurred by a small
sample of LTC hospitals for which we have readily available data. Our
review showed that these expenses generally ranged from 5 to 17 percent
of total inpatient operating costs for the periods under review. By
setting the maximum acceptable level at 15 percent, we believe that we
would allow hospitals an adequate margin for purchase of a limited
range of services, without encouraging a level of dependence that calls
into question the LTC hospital's status as a separate institution.
To implement this policy, we proposed to specify under
Sec. 412.23(e)(3)(i)(E) that the costs of any services a hospital
obtains under contract or other agreements with a hospital occupying
space in the same building or campus, or with a third entity that
controls both hospitals, may not exceed 15 percent of the hospital's
total inpatient operating costs, as defined under Sec. 412.2(c). Thus,
a LTC hospital would be permitted to obtain dietetic, housekeeping,
maintenance or other services from another hospital with which it
shares a building or campus (or from a controlling third entity),
provided that the aggregate cost of these services is no more than 15
percent of its total inpatient operating costs.
Public comments on this proposal are addressed below.
Comment: One commenter objected to an exclusion criterion for LTC
hospitals within hospitals that is stated in terms of the cost, rather
than the type, of services purchased from the host facility. This
commenter stated that hospitals within hospitals are units of acute
care hospitals and should be treated as such. The commenter also stated
that the proposed criterion will further complicate an already complex
system, encourage more facilities to reorganize themselves in an
attempt to gain exclusions from the prospective payment system, and
increase Medicare administrative costs. For all of these reasons, the
commenter recommended that we not only abandon the proposed change but
also revise the regulations to prohibit LTC hospitals within hospitals
from being excluded from the prospective payment system.
Response: Although we share the commenter's concern about possible
abuse of the exclusion provisions, we do not believe that either our
current regulations or our proposals encourage inappropriate
exclusions. On the contrary, the current regulations provide reasonable
assurance that facilities excluded as LTC hospitals are functioning as
separate hospitals, and we believe that our proposed changes will
preserve our ability to achieve this result. Moreover, we expect that
the shift from a type-based to a volume-based standard will reduce,
rather than add to, the complexity and cost of our regulations. Thus,
we do not agree that it is necessary to prohibit all LTC hospitals
within hospitals from being excluded from the prospective payment
system, nor do we believe that the proposed changes will encourage more
facilities to pursue exclusions. For these reasons, we did not adopt
this commenter's suggestions.
Comment: One commenter stated that hospitals within hospitals
typically are set up to serve only the LTC needs of patients of the
host hospital, and are unlikely to receive referrals from other
sources. A hospital of this type also may have a low occupancy level,
thus leading to very high per-stay costs, which will be paid for by
Medicare. To prevent this situation from occurring, the commenter
recommended that the 75 percent alternative criterion in
Sec. 412.23(e)(3)(ii) be made a basic requirement for exclusion. Under
this commenter's recommendation, a hospital within a hospital would be
excluded as a LTC hospital only if it met the 75 percent criterion and
also provided all basic services without assistance from the host
hospital. The commenter argued that this approach will limit the
exclusion of LTC hospitals within hospitals to those that meet
legitimate community needs.
Response: Although we agree that an approach of this kind might
help to prevent abuse of the exclusion provisions, we are concerned
that such a standard might deny exclusion to some legitimately separate
institutions. We believe that the revised criteria are sufficiently
rigorous to identify only situations when exclusion is appropriate, yet
flexible enough to recognize legitimate variations in the ways
hospitals obtain needed services and supplies. Therefore, we did not
adopt this comment.
Comment: Several commenters expressed support for our proposal to
focus on the volume, rather than the type, of services purchased from
the host hospital. However, these commenters also stated that a
criterion set at 15 percent of total inpatient operating costs is too
restrictive. One commenter favored setting the criterion at 25 percent
of the LTC hospital's total inpatient operating costs, with an
exception for higher levels of purchases where the LTC hospital can
show that obtaining services in this way is cost-effective. Another
commenter suggested setting the criterion at 35 percent of total
inpatient operating costs. Still another commenter favored retaining
the requirement that hospitals provide most basic hospital services but
allowing some percentage of basic hospital services, as measured by
cost, to be purchased from the host hospital.
Several commenters expressed concern about the range of costs
considered in arriving at the 15 percent figure. One commenter stated
that the 15 percent threshold is too low because it does not include
those services that were prohibited in the prior years, and recommended
eliminating any limit on the type or cost of services that a LTC
hospital can purchase from its host hospital. Another commenter asked
for more detailed information on how the 15 percent figure was derived
and how the measurement will be implemented. The commenter believes the
15 percent figure is necessarily too low since several categories of
costs (telephone, administrative and general, laundry and linen, social
services, and physical, recreational, and respiratory therapy costs)
were not included in the costs sampled to arrive at that figure. One
commenter stated that the methodology used to arrive at the 15 percent
figure appears to be inadequate, in that it assessed only dietetic,
housekeeping, and maintenance expenses, and did not take into account
services such as hyperbaric oxygen therapy, surgical services, physical
therapy, and security, which can often be obtained most cost-
effectively from the host hospital. Because of concern about these
issues, the commenter recommended that we revise the regulations to
base exclusion on the level of patient needs, rather than the volume of
costs, met by services obtained from the host hospital. Two commenters
recommended that the regulations be revised to state that the inpatient
operating costs to which the 15 percent criterion is applied will not
include any costs of leased space or of equipment rental, maintenance,
or utilities for the space.
Finally, one commenter noted that some new hospitals have
structured their operations for their initial 6-month period of
operation to comply with the requirement that they furnish basic
[[Page 45838]]
hospital services without assistance from the host facility, and have
not held the inpatient operating costs of services purchased from the
host hospital within the 15 percent ceiling allowed by the proposed
regulations. The commenter stated that by shifting to a cost-based
standard, we would in effect be denying exclusion to facilities that
operated in compliance with the exclusion criteria in effect when they
began to provide services. To avoid this scenario, the commenter
suggested that we delay the effective date of the 15 percent rule by an
additional year (that is, until cost reporting periods beginning on or
after October 1, 1996) for hospitals meeting the criterion related to
provision of basic hospital services without assistance from the host
hospital.
Response: These comments appear to reflect some misunderstanding of
the purpose of our proposed change to an exclusion criterion based on
volume of services (as measured by costs) rather than type of services.
The purpose of the proposal is not to identify the most cost-effective
way for a hospital within a hospital to obtain services, but to
describe a pattern of functioning that provides reasonable assurance
that a facility seeking to be excluded from the prospective payment
system as a LTC hospital actually functions as a separate hospital.
Clearly, when a facility operates within another institution, it may be
more cost-effective in many cases to obtain services from the
surrounding institution. It may be even more cost-effective to
integrate the governance and medical direction of the hospital and the
entity. A hospital component that wishes to organize itself in this way
may do so, but it would not constitute a separate hospital under
section 1886(d)(1)(B) of the Act, which provides for the exclusion of
LTC hospitals, but not LTC units, from the prospective payment system.
In assessing the level of dietetic, housekeeping, and maintenance
expenses incurred by a sample of LTC hospitals, our goal was not to set
the criterion at a level that could easily be met by all potential
hospitals within hospitals, but to assess the proportion of costs that
a separate hospital may need to spend for the range of services it can
buy under current exclusion rules. Thus, our intent was to devise a
criterion that would properly assess the level of independence of a
hospital within a hospital, but would allow more discretion as to the
types of services to be supplied by the host facilities. We recognize
that not all hospitals located within hospitals may be able to meet the
criterion, and that in some cases hospitals may need to reduce their
level of purchases from host facilities to qualify for exclusion under
the criterion.
In response to the comments asking for the basis for establishing
the threshold at 15 percent, the proposed 15 percent criterion was
based on our analysis of the best available data. The Hospital Cost
Report Information System (HCRIS), the automated cost report data base
submitted by the fiscal intermediaries, does not contain cost data for
the specific general service cost centers, such as dietary,
housekeeping and maintenance costs, that represent a large portion of
the costs of shared services. As a result, we instead analyzed cost
report data from the hard copies of cost reports that we had on file.
Specifically, we analyzed data for LTC hospitals that had requested a
review of costs in relation to the TEFRA limits. This data showed that
the aggregate of these specific operating costs, in comparison to total
operating costs, ranged from a low of 5 percent to a high of 17
percent. Based on this range, we concluded that 15 percent was a
reasonable level at which to establish the standard, as we proposed in
our June 2, 1995 rule.
In response to public comments on this proposal, we conducted
further analysis of the cost reports aimed at estimating more precisely
the proportion of total inpatient operating costs that is attributable
to basic hospital services. To do so, we refined our analysis to
include additional costs (that is, maintenance and repairs, operation
of plant, and laundry and linen services), to account for ancillary
costs of inpatient hospital services, and to exclude ancillary costs
related to nonhospital components of the institution, such as distinct
part skilled nursing facilities. The new analysis indicated a range of
7 percent to 27 percent, with an average of slightly below 15 percent.
Thus, based on this analysis, we continue to believe that a 15
percent standard represents a valid and reasonable basis for
identifying hospitals within hospitals that actually function
independently. However, we are concerned that some hospitals that have
been excluded appropriately under criteria related to the types of
services they provide independently from their hosts may not be able to
meet the new criterion by the time it becomes effective (that is, by
the start of cost reporting periods beginning on or after October 1,
1995). To avoid this problem as well as to widen, as appropriate, the
range of compliance options available to hospitals within hospitals, we
have decided to make the 15 percent standard an alternative to, rather
than a replacement for, our current criterion on provision of basic
hospital services. This approach will enable hospitals the flexibility
to buy whatever services they wish from the host, subject to the 15
percent limit, but will not require hospitals that qualify for
exclusion under current rules to alter their operations to meet a new
requirement. We note that because we are making the 15 percent rule an
alternative to the current criterion rather than a replacement for it,
a new hospital that has organized itself to meet the current
requirements will not be disadvantaged. Thus, there is no need to delay
application of the 15 percent rule.
With respect to the costs to which the 15 percent criterion will
apply, we are clarifying proposed Sec. 412.23(e)(3) to state that the
criterion apply to total inpatient operating costs, as defined under
Sec. 412.2(c), except that, for purposes of the prospective payment
system exclusion provisions, the costs of preadmission services are
those specified at Sec. 413.40(c)(2), not those described in
Sec. 412.2(c). Costs incurred under leases or rental agreements are
taken into account only to the extent they fall within the
Sec. 412.2(c) definition of operating costs.
Finally, concerning the suggestion on patient needs, we note that
those needs often can be defined only subjectively, and we believe that
any test or measurement used for exclusion should be an objective one
that is susceptible to verification by both the provider and HCFA.
Thus, we did not adopt this suggestion.
Comment: One commenter stated that current rules relating to the
types of services obtained by an LTC hospital within a hospital from
its host are clear and adequate for distinguishing a separate hospital
from a hospital unit, and that a separate rule relating to the volume
of services is not needed. This commenter suggested that instead of
shifting to a volume-based standard, another way to allow greater
flexibility for cost-effective purchasing from the host hospital would
be to allow specific types of basic hospital services, such as
laboratory services, to be purchased from the host facility. Another
commenter recommended that the 15 percent limitation be applied only to
basic hospital services as defined under current regulations, and that
an LTC hospital within a hospital be allowed to buy other services
without limitation from the host hospital.
Response: We agree that either proposed approach would increase
hospital flexibility. However, the types of services available from
host facilities
[[Page 45839]]
and from other sources vary from one community to another, and from
hospital to hospital within a community, and it would be difficult to
specify a range of basic hospital services that could acceptably be
obtained from the host facility in all cases, without permitting so
many types of services to be obtained from the host facility that the
criterion would no longer be a useful measure of independent
functioning. With regard to the second comment, we are concerned that
applying the 15 percent criterion only to basic hospital services would
effectively lower the level of independent functioning necessary for a
hospital to qualify for exclusion, relative to our current
requirements, and thus might permit inappropriate exclusions.
Therefore, we are not adopting either of these suggestions.
Comment: A commenter suggested that the creation of a hospital
within a hospital is potentially abusive only where the LTC hospital is
operated by a corporation owned and controlled by the host hospital, or
by a third entity that controls both the host and the LTC hospitals.
The commenter recommended that the 15 percent rule be applied only
where operational control of this kind exists.
Response: We do not agree with this commenter that simply
satisfying the structural criteria (those related to having a separate
governing body, medical staff, chief executive officer, and chief
medical officer) and average length of stay criteria should be
sufficient to support exclusion of an LTC hospital within a hospital.
On the contrary, we believe it is essential for such an entity to show
that it actually functions as a separate hospital. If the two
facilities meet only the separate control criteria but the LTC facility
either receives fewer than 75 percent of its inpatients from sources
other than the host or receives more services, or different types of
services, from the host than allowed under our regulations, we question
the validity of excluding the facility from the prospective payment
system as a separate LTC hospital. Under these circumstances, the
facility would in reality be a unit of the host hospital. Therefore, we
did not adopt this comment.
Comment: Two commenters stated that the regulations on hospitals
within hospitals should be revised to apply only when an LTC hospital
wishes to share a building or campus with a prospective payment
hospital, not to comparable situations involving a long-term care
hospital and a rehabilitation hospital.
Response: Although the ``hospital within a hospital'' rules were
designed primarily in response to situations involving LTC and
prospective payment hospitals, the possibility of inappropriate
exclusion of a hospital unit can also arise if an excluded hospital
such as a psychiatric or rehabilitation hospital seeks to set up an LTC
hospital within itself. In both situations, our concern is that an
entity that is in essence a hospital unit may seek to obtain an
inappropriate exclusion from the prospective payment system. Section
1886(d)(1)(B) of the Act provides for exclusion of LTC hospitals but
not of LTC units. Because newly created hospitals within hospitals are
eligible for a separate TEFRA target rate and may be eligible for a new
hospital exemption from the rate-of-increase ceiling under
Sec. 413.40(f), we believe it is important to prevent inappropriate
exclusions in all circumstances, not merely those involving prospective
payment hospitals. Thus, we do not believe it is appropriate to limit
the criteria as the commenter suggested.
Comment: One commenter recommended that we revise the regulations
to include a ``grandfather'' clause under which LTC hospitals within
hospitals that were excluded from the prospective payment system before
October 1, 1994, would not need to meet the current exclusion criteria
in order to continue to qualify for exclusion.
Response: The adoption of the 15 percent criterion as an
alternative to the existing exclusion criteria under Sec. 412.23(e)
gives hospitals within hospitals three alternatives for showing that
they function as separate hospitals. Moreover, Sec. 412.23(e)(4)
specifies that the criteria concerning the performance of basic
hospital functions (under Sec. 412.23(e)(3)) do not apply to any
previously excluded hospital until the hospital's first cost reporting
period beginning on or after October 1, 1995. In view of the three
options available to hospitals for establishing eligibility to be
excluded from the prospective payment system, and the delayed effective
date already provided for in regulations, we believe we have
established equitable policies for previously excluded LTC hospitals
within hospitals. Thus, a grandfather clause is unnecessary. Moreover,
we are concerned that indefinitely exempting a set of previously
excluded hospitals from the regulations would be both inequitable to
newer hospitals, and difficult to administer, since similar facilities
would be subject to different payment rules, based only on their
initial date of exclusion. Finally, it would be contrary to the
statutory scheme to exclude LTC units from the prospective payment
system. Thus, we have not adopted this suggestion.
Comment: One commenter asked whether the revised criterion on
purchase of services would apply to the initial qualifying period of 6
months that is used to establish length of stay for a new LTC hospital.
Response: As stated in proposed Sec. 412.23(e)(3)(i)(E), the new
criterion on purchase of services applies to the same period of at
least 6 months used to determine compliance with the length-of-stay
criterion in Sec. 412.23(e)(2).
Comment: One commenter stated that if an acute care hospital is
allowed to set up a LTC hospital within a hospital, it may have a
financial incentive to discharge patients prematurely from the acute
hospital to the long-term care hospital. The commenter suggested that
we adopt further regulations limiting the acute care hospital's ability
to discharge a patient to a LTC hospital that it owns or controls.
Response: We understand and share this commenter's concern, and the
LTC exclusion criteria are designed to prevent inappropriate
exclusions. However, HCFA has no authority to restrict the range of
hospitals to which a patient may be referred following discharge from
acute care. We intend to review this issue, and may propose further
payment changes to avoid financial incentives for inappropriate
placement of patients.
B. Clarifying Changes for Excluded Hospitals and Units (Secs. 412.23,
412.29, 412.30 and 412.130)
For clarity, we proposed to revise Sec. 412.23(e)(3) to state more
clearly that a hospital sharing space with another can qualify for
exclusion only if it meets all of the requirements of paragraphs
(e)(3)(i)(A) through (e)(3)(i)(D) of that section and, in addition,
those in either paragraph (e)(3)(i)(E), which deals with separate
performance of services, or Sec. 412.23(e)(3)(ii), which deals with the
source of the hospital's patients.
In addition, we proposed to restate the rules in Secs. 412.29 and
412.30 to differentiate more clearly between criteria that apply when a
hospital seeks exclusion of a rehabilitation unit that is created
through an addition to its existing bed capacity, and the criteria that
apply when a hospital seeks exclusion of a unit that has been created
by converting existing bed capacity from other uses. We also proposed
to clarify the rules that apply when a hospital expands an existing
rehabilitation unit by increasing its bed capacity or by converting
existing capacity. These
[[Page 45840]]
revisions were developed in response to complaints from some hospital
representatives that the current regulations do not state our criteria
clearly. We emphasized that these proposals merely restate, and do not
change, existing rules. In conjunction with this proposed change, we
also stated that we would make a technical change to a reference in
Sec. 412.130.
Comment: One commenter objected to the provision of
Sec. 412.30(c)(1)(ii) under which the beds a hospital seeks to add to
its existing rehabilitation unit will be considered new only if over 50
percent of the beds represent newly licensed and certified beds. The
commenter stated that this represents a substantive change in the rules
which inappropriately restricts the ability of a hospital to convert
acute care capacity to uses excluded from the prospective payment
system.
Response: As the commenter noted, Sec. 412.30(b) does not deal
explicitly with situations in which a hospital seeks to expand an
excluded rehabilitation unit by adding bed capacity that is made up
partly of newly licensed capacity and partly of existing capacity. One
purpose of the revision was to clarify our policy on this issue.
However, Sec. 412.30(a)(2) does state explicitly that ``a unit that
includes some beds that were previously licensed and certified and some
new beds is recognized as new only if more than one half of the beds
are new.'' Thus, the revision merely restates a current rule as to what
will be considered ``new'' when an existing facility adds a mixture of
newly licensed and existing capacity.
C. Changes to the Regulations Addressing Limitations on Reimbursable
Costs (Secs. 413.30 (e) and (f), and 413.35(b))
We proposed to remove obsolete material from the regulations.
Specifically, we proposed to remove Sec. 413.30 (e)(1), (e)(3), and
(e)(4), since sole community hospitals, risk-basis HMOs, and rural
hospitals with less than 50 beds are included under 42 CFR part 412,
which governs the prospective payment system for operating costs. In
addition, we proposed to remove Sec. 413.30(f)(5), (f)(6), (f)(7) (a
reserved paragraph), and (f)(9), concerning exceptions for hospital
routine care, essential community hospital services, and hospital case-
mix changes for cost reporting periods beginning before October 1,
1983. In conjunction with these proposed changes, we stated that we
would incorporate the exemption requirements for new providers into
paragraph (e) of Sec. 413.30, redesignate subparagraphs under paragraph
(f) of Sec. 413.30, and make technical changes to references in
Secs. 413.30(f) and 413.35(b)(2).
We received no comments on these proposals, and are therefore
adopting the changes as proposed.
D. Payment Window for Hospitals and Hospital Units Excluded from the
Prospective Payment Systems (Sec. 413.40(c))
On January 12, 1994, we published an interim final rule with
comment period to specify that inpatient hospital operating costs
include costs of certain preadmission services furnished by the
hospital (or by an entity that is wholly owned or operated by the
hospital) to the patient up to 3 days before the date of the patient's
admission to the hospital (59 FR 1654). The interim final rule
implemented section 4003 of the Omnibus Budget Reconciliation Act of
1990 (Public Law 101-508), which amended section 1886(a)(4) of the Act.
Because the definition of inpatient operating costs in section
1886(a)(4) of the Act applies to both prospective payment system
hospitals and hospitals excluded from the system, the January 12, 1994
interim final rule revised the regulations governing excluded hospitals
as well as those governing prospective payment hospitals. Specifically,
we revised Sec. 413.40(c)(2) of the regulations to reflect the 3-day
payment window as required by the statute. We received 11 comments in
response to this issue. Although we stated in the proposed rule that we
intended to address these comments in this final rule, we have revised
our plans. We will instead issue the final rule addressing the 3-day
payment window as a separate document to be published in the Federal
Register.
On October 31, 1994, Congress enacted the Social Security Act
Amendments of 1994. Section 110 of that legislation amended section
1886(a)(4) of the Act to state that, for hospitals excluded from the
prospective payment system, the preadmission services to be included
are those furnished during the 1 day (not 3 days) before a patient's
admission.
To implement this provision, we proposed to revise
Sec. 413.40(c)(2) to provide for a 1-day payment window for hospitals
and hospital units excluded from the prospective payment system. We
note that the term ``day'' refers to the calendar day immediately
preceding the date of admission, not the 24-hour time period that
immediately precedes the hour of admission.
We received no comments on this proposal, and are therefore
adopting the changes as proposed.
E. Ceiling on the Rate of Increase in Hospital Inpatient Costs
(Sec. 413.40(e) and (g))
We proposed to revise Sec. 413.40(e)(1) to clarify that a request
for a payment adjustment must be received by a hospital's fiscal
intermediary no later than 180 days from the date of the notice of
program reimbursement (NPR). Currently, this section states that a
request must be ``made'' rather than ``received.'' We have consistently
interpreted the word ``made'' to mean ``received by the fiscal
intermediary'' since the original regulation was promulgated (47 FR
43282, September 30, 1982). However, use of the word ``made'' in
Sec. 413.40(e)(1) has resulted in varying interpretations of the timely
filing requirement by hospitals and their fiscal intermediaries. In the
interest of a uniform and consistent application of our policy, we
proposed to clarify the regulation by substituting ``received by the
hospital's fiscal intermediary'' for ``made'' in Sec. 413.40(e)(1).
In Sec. 413.40(g)(1), we proposed to clarify the determination of
the amount of payment made to a hospital that receives a TEFRA
adjustment. Since October 1, 1991, a hospital with operating costs in
excess of its ceiling has been paid the ceiling plus an additional
amount, as provided at Sec. 413.40(d)(3). For these cost reporting
periods, a hospital receives some payment for costs in excess of the
ceiling. We also proposed to add a sentence to clarify that the amount
of payment made after a TEFRA adjustment may not exceed the difference
between a hospital's operating costs and the payment previously
allowed.
Comment: We received two comments requesting that the postmark date
of the request be used as the determinant of whether the comment is
received timely. One commenter expressed concern about problems with
the intermediary's delivery procedures and delays in the mail room.
Both commenters requested that we use the postmark date to determine
timely filing of an exception request because it provides
``incontrovertible proof'' that a request was made timely and is
consistent with a final rule published in the Federal Register on June
27, 1995 (60 FR 33137) with regard to timely filing of the cost report.
One of the commenters also objected to our proposed policy of using
the receipt date by the intermediary, stating that HCFA often takes 18
months or longer to respond to exception requests. The commenter added
that a request based on sound merits should be
[[Page 45841]]
considered whether it is received on the 180th or 181st day after the
notice of program reimbursement.
Response: The commenter's statement regarding the use of a postmark
date for determining whether cost reports are considered timely filed
is based on language from our response to a comment in a final
regulation published in the Federal Register on June 27, 1995 (60 FR
33139) that extended the due dates for filing cost reports to five
months from the end of the cost reporting period. In that response, we
explained that we use the postmark date in the cost report context in
accordance with section 2219.4C of the Medicare Intermediary Manual.
In the appeals context, however, there are certain statutes and
regulations that impact on our decision as to when payment exceptions
must be requested to be considered timely. While section 1886(b)(4)(A)
of the Act, which provides the Secretary with the authority to grant
exceptions to the per discharge limit, does not specify requirements
with regard to timely filing of an exception request, we believe it is
appropriate to examine section 1878 of the Act. That section addresses
timely filing of a hearing request with the Provider Reimbursement
Review Board (PRRB). Such a request, like an exception request,
involves a provider seeking reimbursement in addition to that set forth
in its notice of program reimbursement. For that reason, we believe
that our policy with regard to the timely filing of an exception
request should be consistent with section 1878 of the Act.
Section 1878(a)(3) of the Act states that if a provider files a
request for a hearing within 180 days after notice of the
intermediary's final determination, the provider can obtain a hearing
with the PRRB. We note that Black's Law Dictionary defines the term
``file'' as follows:
To deposit in the custody or among the records of a court. To
deliver an instrument or other paper to the proper officer or
official for the purpose of being kept on file by him as a matter of
record or reference in the proper place.
Accordingly, we are continuing to use the date received by the
intermediary to determine timely filing of an adjustment request by a
provider. Under this policy, intermediaries will date stamp requests
upon receipt, and we will consider the date stamped on the exception
request by the intermediary as the receipt date to determine timely
filing, unless the provider demonstrates that the intermediary received
the request on some other date. For example, a provider may mail
through an overnight delivery service a request that is not stamped
until the day after delivery. Where the provider can show that it was
delivered on the previous day the request will be considered timely.
With regard to the comment that HCFA often takes 18 months or
longer to respond to exception requests, we regret these delays, which
have resulted from the significant volume of exception requests we have
received. We are making efforts to reduce the backlog and expedite
processing of exception requests. However, we do not agree that all
exception requests should be evaluated on their merits regardless of
whether they are received on the 180th or 181st day after the NPR. To
ensure effective administration of the program, intermediaries must
consistently apply the timely filing requirements.
Comment: One commenter interprets our proposal to clarify that the
amount of payment made after a TEFRA adjustment may not exceed the
difference between a hospital's operating costs and the payment
previously allowed to mean that the TEFRA penalty payment would not
apply.
Response: The commenter's interpretation is not correct. Our
proposal was intended only to ensure that total payments to an excluded
hospital or unit that receives an exception do not exceed total
inpatient operating costs. Currently, hospitals with costs above the
TEFRA limit receive their per discharge limit plus 50 percent of costs
in excess of the limit, up to 110 percent of the target amount. If the
hospital receives an adjustment to its TEFRA target amount, the amount
of penalty payment is recalculated based on the adjusted target amount.
Under our policy, the hospital could continue to receive the TEFRA
penalty payment and any additional adjustment amounts, but only up to
its total inpatient operating costs. Accordingly, the total payment
would not exceed total inpatient operating costs.
VII. ProPAC Recommendations
As required by law, we reviewed the March 1, 1995 report submitted
by ProPAC to Congress and gave its recommendations careful
consideration in conjunction with the proposals set forth in the
proposed rule. We also responded to the individual recommendations in
the proposed rule. The comments we received on the treatment of the
ProPAC recommendations are set forth below along with our responses to
those comments. However, if we received no comments from the public
concerning a ProPAC recommendation or our response to that
recommendation, we have not repeated the recommendation and response in
the discussion below. Recommendations 1, 4, and 5, concerning the
update factors for inpatient operating costs, the update factor for
hospitals paid on the basis of hospital-specific rates, and the update
factor for hospitals excluded from the prospective payment system and
distinct-part units, respectively, are discussed in Appendix C to this
final rule. Recommendations 2 and 3, concerning the update factors for
inpatient capital costs and the single operating and capital update
factor, respectively, are discussed in Section V of this final rule.
Recommendation 11, concerning improving Medicare transfer payment
policy, is discussed in section IV.A of the preamble. The remaining
recommendations on which we received comments are discussed below.
A. Update to the Composite Rate for Dialysis Services (Recommendation
6)
Recommendation: For FY 1996, the composite rate for dialysis
services should be updated to account for the following:
The projected increase in the market basket index for
dialysis services, currently estimated at 3.7 percent;
A net adjustment of zero percentage points for scientific
and technological advances and productivity; and
A negative discretionary adjustment of 3.7 percentage
points to reflect the relationship between payments and estimated
fiscal year 1995 costs.
This would result in an update of zero percent.
Response in the Proposed Rule: We agree with ProPAC's
recommendation not to propose a payment rate increase for dialysis
services. ProPAC's cost analysis indicates that, in aggregate, Medicare
payments to independent dialysis facilities were about 12 percent
higher than their Medicare allowable costs, and thus there is no basis
to increase the composite rate. Furthermore, ProPAC concludes that
without documented explanations for reported higher costs in hospital-
based facilities, it cannot justify a differential update for these
facilities.
ProPAC's analysis of the 1993 unaudited cost data shows that
Medicare allowable costs for independent facilities are less than their
payment rate. Since 1983, the number of independent facilities has
continued to increase in response to growing patient demand, even
though payment rates have remained constant. As noted by ProPAC, the
margin between
[[Page 45842]]
independent facilities' composite payment rates and their Medicare
allowable costs continues to decrease. Because of this trend, we will
closely monitor the costs of dialysis treatments as reported by
facilities on their cost reports. Further, if Medicare's conditions of
coverage are revised to include an adequacy of dialysis standard, we
will examine the need to adjust composite payment rates. The current
composite payment rates are mandated by statute.
To improve the quality of the cost report data and to address
concerns about the cost report, we have revised the independent
facilities' cost report, Form HCFA 265-94. The new cost report
eliminates the allocation of the facility's overhead to the drug
recombinant human erythropoietin (EPO). In addition, we are revising
the independent cost reports edits. These edits would screen cost
report data to ensure that data elements outside edit ranges are
investigated by intermediaries.
Comment: One commenter asserted that the difference in cost levels
between freestanding facilities and hospital-based renal facilities is
obvious; hospital-based renal facilities treat a more resource
intensive and complicated patient base. The commenter recommended
updating the composite payment rates using the hospital market basket
index.
Response: ProPAC addressed this issue in its report. Its analysis
did not attribute the difference in cost to factors such as patient
mix, for which the composite payment rate system should compensate
renal facilities. Rather, it showed that the higher cost per treatment
in hospital-based facilities was due to higher labor expenses and the
method by which costs are allocated between inpatient and outpatient
departments. Differences between independent and hospital-based
facilities in quality of care and patient outcomes have not been
demonstrated. Patient data showed in the aggregate that there is no
difference between hospital and independent renal patient medical
populations. For renal facilities treating an atypical patient
population, there is an exception process. This process gives renal
facilities an opportunity, on a case by case basis, to demonstrate that
their payment rates should be adjusted to account for higher costs
attributable to differences in patient mix.
Comment: ProPAC commends the Secretary's efforts to improve the
quality of cost report data by eliminating the allocation of
facilities' overhead to the drug recombinant human erythropoietin (EPO)
and by revising the independent cost report edits to screen cost report
data more effectively. The Commission believes, however, that annual
audits are necessary to develop the quality data needed to monitor
dialysis costs over time and to ensure that payments for dialysis
services are updated appropriately.
Response: Audits are important to ensure the quality of cost
reporting data and would improve the quality of the data. However,
audits are expensive for HCFA and for renal facilities, and they only
correct the data being audited. The best way to improve the quality of
cost data is through education, such as that being conducted by the
National Renal Administrator Association. We are in the process of
developing a national standard to measure the adequacy of dialysis. We
will conduct audits once this standard is implemented. These audits
should then document the costs associated with improved dialysis care.
B. Level of the Indirect Medical Education (IME) Adjustment to
Prospective Payment System Operating Payments (Recommendation 7)
Recommendation: For FY 1996, the IME adjustment to prospective
payment system operating payments should be reduced by 13 percent, from
a 7.7 percent to a 6.7 percent increase for every 10 percent increment
in teaching intensity. Ultimately, the IME adjustment should be reduced
by about 40 percent, to a 4.5 percent increase for every 10 percent
increment in teaching intensity.
Response in the Proposed Rule: ProPAC's IME estimate of 4.5 percent
represents a significant acceleration in the downward trend of its
estimates in the last several years (5.7 percent in 1992, 5.4 percent
in 1993, and 5.2 percent in 1994). Coupled with FY 1993 cost report
data showing major teaching hospitals' Medicare operating margins
(difference between payments and costs as a percentage of payments)
rising to over 11 percent, this declining IME estimate adds to the
argument that the current adjustment is too high. Legislation would be
required to reduce the IME adjustment. However, savings proposals of
this sort would only be appropriate in the context of health care
reform.
Comment: ProPAC's comment largely reiterated the discussion
contained in its March 1995 report. ProPAC did indicate that, contrary
to our assertion that its IME estimate of 4.5 percent represents an
acceleration in the downward trend of its recent estimates, this
apparent downward trend reflects its ``continuing efforts to improve
both the methods used to analyze this relationship and the accuracy of
the resulting estimates.'' The Commission's comment goes on to indicate
that, applying its current estimating methodology to prior year's data,
``the results do not vary much from the current 4.5 percent estimate.
Response: We agree that, in our June 2, 1995 response to ProPAC's
recommendation, we may have misinterpreted ProPAC's most recent IME
estimates as indicating an accelerating downward trend. Upon further
discussion with ProPAC, it appears that, rather than a declining
relationship over time, the decline in the most recent estimate results
from a change in how ProPAC controls for cost differences resulting
from hospital location (that is, large urban, other urban or rural).
Specifically, in its most recent estimate, ProPAC included dummy
variables in the regression to indicate that a hospital is located in a
large or other urban area, rather than standardizing the dependent
variable costs per discharge for differences in the standardized
amounts.
C. Making DRG Payment Rates More Accurate (Recommendation 9)
Recommendation: The Secretary should implement, as soon as
practicable, the DRG severity refinements developed by HCFA. At the
same time, she should improve the accuracy of basic DRG payment rates
and outlier payments by changing the methods used to calculate the DRG
relative weights. The weights should be based on the national average
of hospital-specific relative values for all cases in each DRG, rather
than the national average standardized charge per case.
Response in the Proposed Rule: In the May 27, 1994 proposed rule
(59 FR 27716), we announced the availability of a paper we prepared
that describes our preliminary severity DRG classification system and
the analysis upon which our proposal was formulated. Based on the 100
comments we received on that paper, we are further analyzing and
adjusting the severity DRG classifications. We are also examining the
stability of the severity classifications over time. We agree with the
Commission's judgment that adopting the severity DRGs would tend to
reduce current discrepancies between payments and costs for individual
cases and thereby improve payment equity among hospitals. We therefore
remain committed to implementing the severity DRG classification system
as soon as possible. (See discussion in Section II.B of this preamble.)
[[Page 45843]]
We also agree with the Commission that basing DRG weights on
standardized charges results in weights that are somewhat distorted as
measures of the relative costliness of treating a typical case in each
DRG. The Commission notes several sources of distortion, including the
following: systematic differences among hospitals in cost-to-charge
ratios; variation in mark-ups for services across hospitals; variation
among DRGs in the average mark-up implicit in case level charges;
standardization factors that inaccurately represent cost differences
among hospitals; and the absence of adjustments to account for factors
such as variations in practice patterns and efficiency. We recognize
that the hospital-specific relative value method of setting weights may
reduce or eliminate distortions from these sources, and we are studying
its effect on DRG weights and hospital payments.
The Commission also addresses two issues regarding current outlier
financing policies: (1) how to account for outlier payments in setting
a DRG weight that accurately reflects the relative costliness of
treatment for typical cases; and (2) how to finance outlier payments so
that the burden of treating such cases is spread fairly among all
hospitals. We are studying these issues and look forward to working
with ProPAC to find solutions.
Because the effects on DRG weights of implementing DRG severity
refinements and changing the methods used to calculate DRG relative
weights are interactive, we believe that appropriate changes should be
adopted concurrently. However, as stated in the final rule published on
September 1, 1992 (57 FR 39761) and in subsequent rules, as well as in
this rule, we would not make significant changes to the DRG
classification system unless we are able either to improve our ability
to predict coding changes by validating in advance the impact that
potential DRG changes may have on coding behavior, or to make
methodological changes to prevent building the inflationary effects of
the coding changes into future program payments. (See comment and
response following Recommendation 10 below).
D. Improving Annual Update Policies (Recommendation 10):
Recommendation: The Secretary should be given authority to adjust
the standardized amounts if anticipated coding improvements would
increase aggregate payments by more than 0.25 percent during the coming
year. This adjustment should be separate from the annual update. It
should be based on findings from empirical analysis of the new HCFA
data base of reabstracted medical records. Once sufficient data are
available, the Secretary should also make a correction if there is more
than a 0.1 percentage point error in a previous adjustment.
Response in the Proposed Rule: We agree with ProPAC that
anticipated coding changes should be taken into account and that the
most appropriate method for recognizing valid increases in case mix as
a result of improved coding practices is within the framework of the
standardized payment amount. We acknowledge, with ProPAC, that shifts
in the mix of cases among DRGs may result from changes in practice
patterns, new technology, or variations in the incidence of illness, as
well as changes in the coding of diagnoses and procedures.
As ProPAC states, under section 1886(d)(4)(C) of the Act, we are
required to make DRG reclassification and recalibration changes in a
budget neutral manner. To meet this requirement, we normalize the DRG
relative weights so that, for the discharges in the data base, the
average DRG weights before and after reclassification and recalibration
are equal. The recalibration of the DRG weights is accompanied by a
budget neutrality adjustment to the standardized payment amount to
ensure that estimated aggregate payments remain unchanged.
We share ProPAC's concern that introduction of any major
modification to the DRG classification system will result in major
shifts in the distribution of cases among the DRGs. Because the
severity refinements to the DRGs would create many new DRGs with
relatively high weights, there will be increased incentive to hospitals
to report those secondary diagnoses that result in assignment to the
higher weighted DRG. We agree with ProPAC that this is not
inappropriate and is indeed anticipated. We further agree that we need
to ensure that hospitals are fairly compensated for increases in costs
that reflect real increases in the level of severity of illness of
their patient population.
In order to protect the Medicare program from payment increases
that are a consequence of improved coding practices that do not reflect
a real increase in case mix, we have developed a methodology that would
recalibrate the DRG relative weight to 1.0 each year, thus eliminating
the normalization process and the concomitant inflationary adjustment
to the DRG weights. This would prohibit upcoding and other coding
improvements from having an impact on the DRG relative weight. To
account for real case-mix increases, we have recommended an annual
upward adjustment to the standardized amounts equal to the lesser of
the total observed case-mix increase or 1.0 percent. Anticipated case-
mix change due to upcoding would be accounted for through a prospective
adjustment to the standardized amounts. This adjustment would be for
one year at a time and would not be cumulative.
ProPAC recommends that an ongoing data base of reabstracted medical
records be used to estimate the real and coding components of case-mix
change and provide the basis for forecasting future coding changes.
HCFA has recently implemented a record reabstracting process being
conducted by two clinical data abstraction centers (CDACs) under
contract with the Health Standards and Quality Bureau (HSQB). The CDACs
will review a national random sample of 30,000 records per year from
the National Case History file, gathered on a monthly basis. Registered
Record Administrators (RRAs) and Associate Record Technicians (ARTs)
will reabstract the medical record and perform complete record medical
coding, which will be stored with the original coding.
We will evaluate the results of this reabstracting process before
making a decision to base adjustments for anticipated coding changes
only on this data base. Our estimate of an annual real case-mix
increase of 1.0 percent is supported by past studies of case-mix change
by the Rand Corporation. The most recent study by RAND, ``Has DRG Creep
Crept Up? Decomposing the Case Mix Index Change Between 1987 and
1988'', by G.M. Carter, J.P. Newhouse and D.A. Relles, R-4098-HCFA/
ProPAC (1991), uses medical records from those Federal fiscal years,
using consistent standards, to determine real case-mix change.
As we pursue options and alternatives to payment adjustments to
account for real case-mix increases, we will take into consideration
ProPAC's recommendations to limit adjustments to those occasions in
which coding changes would increase aggregate payments by more than
0.25 percent or when forecasts differ from observed, actual experience
by more than 0.1 percent. We note, also, that we are considering a
number of related modifications to the calculation of the DRG relative
weights that will have an impact on the prospective payment rates. (See
response to ProPAC Recommendation 9, above.)
Comment: In its comment on our response to ProPAC Recommendation 9
[[Page 45844]]
and 10 (Improvements in the DRG Payment Rates and Annual Update
Policies), the Commission indicated that it continues to believe that
refinements to the DRG definitions and relative weights should be
implemented as soon as possible. While the Commission agrees that
adopting the refined DRGs could lead to changes in hospital coding
behavior, it states that recalibrating the weights annually to 1.0 in
not necessary to protect Medicare from the effects of coding change.
ProPAC believes this may actually interfere with reducing the program's
financial risk if it is perceived as an arbitrary means of reducing
spending. Additionally, it does not believe that limiting future
increases in payments to the lesser of the measured real change or 1.0
percent is plausible if the real change turns out to be higher.
The Commission, although stating appreciation of our desire to
evaluate the new reabstracted data base, states that this data base
exceeds the size and representativeness of any data base previously
used to determine adjustments for coding change. ProPAC reiterates its
recommendation that an adjustment, separate from the annual update, be
applied in situations when changes in coding, anticipated in response
to major revisions in the DRG definitions or the relative weights, are
expected to lead to an increase in aggregate payments of at least 0.25
percent. The projected effect of changes in coding would be based on
empirical analysis of the reabstracted medical records available to
HCFA, and corrections would be made when significant forecast errors
are detected.
Response: Although we agree with the Commission that these policy
changes will improve equitable payment across hospitals, we believe it
would be irresponsible for HCFA to implement the severity adjustment to
the DRGs before we are able to predict or control the impact of coding
changes on final DRG assignment and, thus, on payment. We do not agree
that recalibration of the DRG relative weights to 1.0 will be perceived
as arbitrary. With sufficient understanding of the rationale and
results, as well as of the other modifications to the payment rate and
DRG weights, the health care community should appreciate our efforts to
identify and measure real case-mix increases. Nor do we agree that our
rationale for limiting adjustments to the standardized amounts for real
change in case mix to the lesser of the measured real change or 1.0
percent is not plausible. As stated in the proposed rule (60 FR 29247),
our estimate of annual real case-mix increase of 1.0 percent is
supported by past studies of case-mix change by RAND. We are willing to
re-examine this issue, if empirical evidence provided through analysis
of the reabstracted data from the clinical data abstraction centers
(CDACs) demonstrates that real case-mix change is significantly more or
less than 1.0 percent.
As discussed in section II.B. of this preamble, collection of data
from the CDACs has recently been implemented, and we will evaluate the
results of this reabstracting process. Only through this evaluation
will we be able to confirm the reliability and validity of these data
as a basis for predicting case-mix increases. We will consider ProPAC's
recommendations to adjust the standardized amount only when coding
changes increase aggregate payments by more than 0.25 percent. However,
we believe it is prudent and responsible policy to defer DRG changes,
as well as adjustments in anticipation of coding changes, until such
adjustments can be based on empirical analysis of the reabstracted
medical records. As noted by ProPAC in its recommendations, the current
statute prevents us from making any adjustment to the standardized
amount to account for coding improvements.
VIII. Other Required Information
A. Paperwork Reduction Act
Under the Paperwork Reduction Act of 1995, agencies are required to
provide 60-day notice in the Federal Register and solicit public
comment before a collection of information requirement is submitted to
the Office of Management and Budget (OMB) for review and approval. In
order to fairly evaluate whether an information collection should be
approved by OMB, section 3506(c)(2)(A) of the Paperwork Reduction Act
of 1995 requires that we solicit comment on the following issues:
Whether the information collection is necessary and useful
to carry out the proper functions of the agency;
The accuracy of the agency's estimate of the information
collection burden;
The quality, utility, and clarity of the information to be
collected; and
Recommendations to minimize the information collection
burden on the affected public, including automated collection
techniques.
Therefore, we are soliciting public comment on each of these issues for
the two information collection requirements discussed below.
As discussed in detail in section IV.B of this preamble, we are
eliminating the requirement under Sec. 412.46(a) that a physician sign
an attestation statement for each Medicare patient discharged from a
hospital. When the prospective payment system for hospitals was
established in 1983, we believed that the physician attestation
statement was a valuable tool for ensuring the validity of DRG claims.
Over the years, however, we have received many complaints from both
hospitals and physicians concerning the administrative burden of
completing the attestation statements. Moreover, in practice, review of
attestation statements by the Peer Review Organizations (PROs) as a
part of DRG validation review has resulted in less than a 0.01 percent
denial rate of sampled claims. Therefore, we believe it is now
appropriate to eliminate the physician attestation requirement. Also,
we note that the Administration has identified the elimination of
physician attestation as one of its health care regulatory reforms.
This change would reduce significantly the paperwork and
information collection burden on physicians and hospitals. We estimate
that currently physicians spend about 192,000 hours per year completing
attestations. This estimate is based on 11,500,000 hospital inpatient
claims per year and 1 minute of physician time per claim. In addition,
any time that hospitals spend following up on overdue and unsigned
attestations would also be saved.
The only remaining requirement under Sec. 412.46 is that a hospital
have on file a signed statement from each attending physician
acknowledging that he or she has received a notice from the hospital
explaining the penalties applicable for misrepresenting, falsifying, or
concealing essential information required for payment. We estimate that
this requirement imposes on physicians and hospitals a shared one-time
burden of 5 minutes for acknowledgement for each physician that gains
admitting privileges. We further estimate that no more than 1-2 percent
of the nation's roughly 700,000 active physicians gain admitting
privileges at a hospital each year, resulting in an estimated annual
burden of approximately 1,200 hours.
Under Sec. 412.106(b)(3), for purposes of the DSH adjustment, a
hospital's Medicare Part A/SSI percentage may be calculated based on
its cost reporting period rather than the Federal fiscal year. (See
section IV.E of the preamble.) Under current policy, a hospital must
submit, in machine-readable format, data on its Medicare Part A
patients for its cost reporting period. As discussed in detail in the
preamble, this process has not resulted in accurate recalculations of
the disproportionate
[[Page 45845]]
patient percentages, and thus requiring hospitals to submit data has
not proven useful or necessary. Therefore, we are revising this
requirement to provide that hospitals need only make a written request
for the recalculation and need not submit the data. We estimate that
the current burden associated with submitting the data is approximately
24 hours per request. Under the revision, we estimate a burden of 1
hour per request. Based on an estimate of 12 requests per year, the
total burden will be 12 hours, in comparison to the current total
burden of approximately 288 hours.
These information collection and recordkeeping requirements are not
effective until they have been approved by OMB. A notice will be
published in the Federal Register when approval is obtained.
Organizations and individuals desiring to submit comments on these
information collection and recordkeeping requirements should direct
them to the Office of Management and Budget, Human Resources and
Housing Branch, Room 10235, New Executive Office Building, Washington,
D.C., 20503, Attention: Allison Eydt, HCFA Desk Officer.
B. Requests for Data From the Public
In order to respond promptly to public requests for data related to
the prospective payment system, we have set up a process under which
commenters can gain access to the raw data on an expedited basis.
Generally, the data are available in computer tape format or
cartridges; however, some files are available on diskette. In our June
2, 1995 proposed rule, we published a list of data sets that are
available for purchase (60 FR 29249). We received no comments
concerning this process.
C. Waiver of Notice of Proposed Rulemaking and 30-Day Delay in the
Effective Date for the Elimination of the Physician Attestation
Requirement
We ordinarily publish a notice of proposed rulemaking for a rule to
provide a period for public comment. However, we may waive that
procedure if we find good cause that prior notice and comment are
impractical, unnecessary, or contrary to public interest. We find good
cause to implement this rule as a final rule because the delay involved
in prior notice and comment procedures for the new provisions of this
rule would be contrary to the public interest.
One provision of this rule that was not part of our June 2, 1995
proposed rule is the elimination of the requirement in 42 CFR
Sec. 412.46(a) that a physician sign an attestation statement for each
Medicare patient discharged from a hospital. Although this change was
not part of the proposed rule, we received close to 1,000 letters from
physicians and hospitals requesting that we eliminate the physician
attestation requirement. As discussed above, this change will reduce
significantly the paperwork and information collection burden on
physicians and hospitals. We believe that it is appropriate to
implement this revision as part of this final rule as the most
expeditious means of removing this burden on physicians and hospitals.
Thus, particularly in view of the many unsolicited letters we have
already received on this subject, we find that the delay involved in
prior notice and comment would be contrary to the public interest.
Therefore, we have concluded that it is appropriate to implement the
revisions to Sec. 412.46 as final in this instance.
We also normally provide a delay of 30 days in the effective date
of a regulation. However, if adherence to this procedure would be
impractical, unnecessary, or contrary to public interest, we may waive
the delay in the effective date. We may also waive the delay in the
case of a rule that grants an exemption or relieves a restriction. We
find good cause to waive the usual 30-day delay in this instance. As
explained above, it is in the public interest for the elimination of
the physician attestation requirement to take effect as soon as
possible. A 30-day delay in the effective date would only extend
unnecessarily an onerous requirement on physicians and hospitals.
Therefore, we believe that a 30-day delay in the effective date for
this provision would be contrary to the public interest, and we find
good cause to waive the usual 30-day delay in the effective date.
D. Waiver of Notice of Proposed Rulemaking for Allowing the Provision
of Skilled Nursing Facility (SNF) Services by Rural Primary Care
Hospitals (RPCHs)
In addition to the elimination of the physician attestation
requirement under Sec. 412.46, this final rule contains one other
provision that was not included in the June 2, 1995 proposed rule.
Specifically, the proposed rule did not include the changes contained
in this final rule to Sec. 485.645, Special requirements for RPCH
providers of long-term care services (``swing beds''). As noted above,
we ordinarily publish a notice of proposed rulemaking for a substantive
rule to provide a period of public comment. Again, however, we may
waive that procedure if we find good cause that prior notice and
comment are impractical, unnecessary, or contrary to public interest.
As explained in detail in section IV.G of this preamble, effective
October 31, 1994, section 102(c) of the Social Security Act Amendments
of 1994 (SSAA '94) allows a hospital with a swing-bed agreement in
effect when it applies for RPCH designation to maintain as many beds
for the furnishing of SNF-level services as it had on its hospital
license when it applied to the State for designation as a RPCH, minus
the number of inpatient beds (not to exceed six) used for the provision
of RPCH inpatient care. The new legislation further states that the
number of beds the facility uses for SNF-level care is not to include
any beds of a unit of the facility that is licensed as a distinct-part
SNF at the time the facility applies to the State for designation as a
RPCH. To implement this provision, we are amending Sec. 485.645 to
reflect the new statutory language. We also are providing that swing-
bed RPCHs that applied for RPCH designation before October 31, 1994,
may either continue to provide care in accordance with the prior
provisions of the regulations or request redesignation under the new
provisions.
The regulations published in final in this rule implement the
provisions of section 102(c) of SSAA '94 as the statute intends. The
statutory effective date of the provisions of section 102(c) is October
31, 1994, and several facilities have indicated an interest in being
designated as RPCHs under the new provisions. Moreover, we believe
these changes may be necessary to assure access to SNF-level care in
rural areas. Thus, we believe that it is both unnecessary and contrary
to the public interest to delay implementation of these provisions
until the process of publishing both a proposed and a final rule can be
completed. Therefore, we find good cause to waive proposed rulemaking
for the revised requirements set forth under Sec. 485.645 and to issue
these regulations as final. However, we are providing a 60-day period
for public comment, as indicated at the beginning of this rule, on the
changes to Sec. 485.645.
E. Response to Comments
Because of the large number of items of correspondence we normally
receive on Federal Register documents published for comment, we are not
able to acknowledge or respond to them individually. We will consider
all comments we receive by the date and time specified in the DATES
section of this preamble, and we will respond to these comments in
subsequent rulemaking document. Comments on
[[Page 45846]]
changes to the revised requirements under Sec. 485.645 will be
considered if we receive them by the date specified in the DATES
section of this preamble. We will not consider comments concerning
provisions that remain unchanged from the June 2, 1995 proposed rule or
that were changed based on public comments.
List of Subjects
42 CFR Part 412
Administrative practice and procedure, Health facilities, Medicare,
Puerto Rico, Reporting and recordkeeping requirements.
42 CFR Part 413
Health facilities, Kidney diseases, Medicare, Puerto Rico,
Reporting and recordkeeping requirements.
42 CFR Part 424
Emergency medical services, Health facilities, Health professions,
Medicare.
42 CFR Part 485
Grant programs-health, Health facilities, Medicaid, Medicare,
Reporting and recordkeeping requirements.
42 CFR Part 489
Health facilities, Medicare, Reporting and recordkeeping
requirements.
42 CFR chapter IV is amended as set forth below:
A. Part 412 is amended as follows:
PART 412--PROSPECTIVE PAYMENT SYSTEMS FOR INPATIENT HOSPITAL
SERVICES
1. The authority citation for part 412 continues to read as
follows:
Authority: Secs. 1102, 1815(e), 1820, 1871, and 1886 of the
Social Security Act (42 U.S.C. 1302, 1395g(e), 1395i-4, 1395hh, and
1395ww).
Subpart A--General Provisions
2. Section 412.4 is amended as follows:
a. In the first sentence of paragraph (d)(1), the phrase ``is paid
a per diem rate'' is removed and the phrase ``is paid a graduated per
diem rate'' is added in its place.
b. In paragraph (d)(1), a new sentence is added at the end of the
paragraph.
The addition reads as follows:
Sec. 412.4 Discharges and transfers.
* * * * *
(d) Payment to a hospital transferring an inpatient to another
hospital. (1) * * * Payment is graduated by paying twice the per diem
amount for the first day of the stay, and the per diem amount for each
subsequent day, up to the limit as described in paragraph (d)(1) of
this section.
* * * * *
Subpart B--Hospital Services Subject to and Excluded from the
Prospective Payment Systems for Inpatient Operating Costs and
Inpatient Capital-Related Costs
3. Section 412.23 is amended as follows:
a. Paragraphs (e)(2) and (e)(3) are revised.
b. In paragraph (e)(4), the phrase ``in paragraphs (e)(3) of this
section'' is removed and the phrase ``in paragraph (e)(3) of this
section'' is added in its place.
The revisions read as follows:
Sec. 412.23 Excluded hospitals: Classifications.
* * * * *
(e) Long-term care hospitals. * * *
(2) The hospital must have an average length of inpatient stay
greater than 25 days--
(i) As computed by dividing the number of total inpatient days
(less leave or pass days) by the number of total discharges for the
hospital's most recent complete cost reporting period;
(ii) If a change in the hospital's average length of stay is
indicated, as computed by the same method for the immediately preceding
6-month period; or
(iii) If a hospital has undergone a change of ownership (as
described in Sec. 489.18 of this chapter) at the start of a cost
reporting period or at any time within the preceding 6 months, the
hospital may be excluded from the prospective payment system as a long-
term care hospital for a cost reporting period if, for the 6 months
immediately preceding the start of the period (including time before
the change of ownership), the hospital has the required average length
of stay, continuously operated as a hospital, and continuously
participated as a hospital in Medicare.
(3) Except as provided in paragraph (e)(4) of this section, for
cost reporting periods beginning on or after October 1, 1994, a
hospital that occupies space in a building also used by another
hospital, or in one or more entire buildings located on the same campus
as buildings used by another hospital, must meet the following
criteria:
(i) Separate governing body. The hospital has a governing body that
is separate from the governing body of the hospital occupying space in
the same building or on the same campus. The hospital's governing body
is not under the control of the hospital occupying space in the same
building or on the same campus, or of any third entity that controls
both hospitals.
(ii) Separate chief medical officer. The hospital has a single
chief medical officer who reports directly to the governing body and
who is responsible for all medical staff activities of the hospital.
The chief medical officer of the hospital is not employed by or under
contract with either the hospital occupying space in the same building
or on the same campus or any third entity that controls both hospitals.
(iii) Separate medical staff. The hospital has a medical staff that
is separate from the medical staff of the hospital occupying space in
the same building or on the same campus. The hospital's medical staff
is directly accountable to the governing body for the quality of
medical care provided in the hospital, and adopts and enforces bylaws
governing medical staff activities, including criteria and procedures
for recommending to the governing body the privileges to be granted to
individual practitioners.
(iv) Chief executive officer. The hospital has a single chief
executive officer through whom all administrative authority flows, and
who exercises control and surveillance over all administrative
activities of the hospital. The chief executive office is not employed
by, or under contract with, either the hospital occupying space in the
same building or on the same campus or any third entity that controls
both hospitals.
(v) Performance of basic hospital functions. The hospital meets one
of the following criteria:
(A) The hospital performs the basic functions specified in
Secs. 482.21 through 482.27, 482.30, and 482.42 of this chapter through
the use of employees or under contracts or other agreements with
entities other than the hospital occupying space in the same building
or on the same campus, or a third entity that controls both hospitals.
Food and dietetic services and housekeeping, maintenance, and other
services necessary to maintain a clean and safe physical environment
could be obtained under contracts or other agreements with the hospital
occupying space in the same building or on the same campus, or with a
third entity that controls both hospitals.
(B) For the same period of at least 6 months used to determine
compliance with the length-of-stay criterion in paragraph (e)(2) of
this section, the cost of the services that the hospital obtained under
contracts or other agreements
[[Page 45847]]
with the hospital occupying space in the same building or on the same
campus, or with a third entity that controls both hospitals, is no more
than 15 percent of the hospital's total inpatient operating costs, as
defined in Sec. 412.2(c). For purposes of this paragraph, however, the
costs of preadmission services are those specified under
Sec. 413.40(c)(2) rather than those specified under Sec. 412.2(b)(5).
(C) For the same period of at least 6 months used to determine
compliance with the length-of-stay criterion in paragraph (e)(2) of
this section, the hospital has an inpatient population of whom at least
75 percent were referred to the hospital from a source other than
another hospital occupying space in the same building or on the same
campus.
* * * * *
4. In Sec. 412.29, the introductory text is republished, and
paragraph (a) is revised to read as follows:
Sec. 412.29 Excluded rehabilitation units: Additional requirements.
In order to be excluded from the prospective payment systems, a
rehabilitation unit must meet the following requirements:
(a) Have met either the requirements for--
(1) New units under Sec. 412.30(a); or
(2) Converted units under Sec. 412.30(b).
* * * * *
5. Section 412.30 is amended as follows:
a. Paragraph (a) is revised.
b. Paragraphs (b) and (c) are redesignated as paragraphs (c) and
(d).
c. A new paragraph (b) is added.
d. Redesignated paragraph (c) is revised.
e. In redesignated paragraph (d), the phrase ``under paragraph (b)
of this section,'' is removed and the phrase ``under paragraph (c) of
this section,'' is added in its place.
The revisions and addition read as follows:
Sec. 412.30 Exclusion of new rehabilitation units and expansion of
units already excluded.
(a) New units. (1) A hospital unit is considered a new unit if the
hospital--
(i) Has not previously sought exclusion for any rehabilitation
unit; and
(ii) Has obtained approval, under State licensure and Medicare
certification, for an increase in its hospital bed capacity that is
greater than 50 percent of the number of beds in the unit.
(2) A hospital that seeks exclusion of a new rehabilitation unit
may provide a written certification that the inpatient population the
hospital intends the unit to serve meets the requirements of
Sec. 412.23(b)(2) instead of showing that the unit has treated such a
population during the hospital's most recent cost reporting period.
(3) The written certification described in paragraph (a)(2) of this
section is effective for the first full cost reporting period during
which the unit is used to provide hospital inpatient care. If the
hospital has not previously participated in the Medicare program as a
hospital, the written certification also is effective for any cost
reporting period of not less than 1 month and not more than 11 months
occurring between the date the hospital began participating in Medicare
and the start of the hospital's regular 12-month cost reporting period.
(4) A hospital that has undergone a change of ownership or leasing
as defined in Sec. 489.18 of this chapter is not considered to have
participated previously in the Medicare program.
(b) Converted units. A hospital unit is considered a converted unit
if it does not qualify as a new unit under paragraph (a) of this
section. A converted unit must have treated, for the hospital's most
recent 12-month cost reporting period, an inpatient population of which
at least 75 percent required intensive rehabilitation services for the
treatment of one or more conditions listed under Sec. 412.23(b)(2).
(c) Expansion of excluded rehabilitation units.
(1) New bed capacity. The beds that a hospital seeks to add to its
excluded rehabilitation unit are considered new beds only if--
(i) The hospital's State-licensed and Medicare-certified bed
capacity increases at the start of the cost reporting period for which
the hospital seeks to increase the size of its excluded rehabilitation
unit, or at any time after the start of the preceding cost reporting
period; and
(ii) The number of beds the hospital seeks to add to its excluded
rehabilitation unit is greater than 50 percent of the number of beds by
which the hospital's State licensed and Medicare certified bed capacity
increased under paragraph (c)(1)(i) of this section.
(2) Conversion of existing bed capacity.
(i) Bed capacity is considered to be existing bed capacity if it
does not meet the definition of new bed capacity under paragraph (c)(1)
of this section.
(ii) A hospital may increase the size of its excluded
rehabilitation unit through conversion of existing bed capacity only if
it shows that, for all of the hospital's most recent cost reporting
period of at least 12 months, the beds have been used to treat an
inpatient population meeting the requirements of Sec. 412.23(b)(2).
* * * * *
Subpart C--Conditions for Payment Under the Prospective Payment
Systems for Inpatient Operating Costs and Inpatient Capital-Related
Costs
6. Section 412.46 is revised to read as follows:
Sec. 412.46 Medical review requirements: Physician acknowledgement.
(a) Basis. Because payment under the prospective payment system is
based in part on each patient's principal and secondary diagnoses and
major procedures performed, as evidenced by the physician's entries in
the patient's medical record, physicians must complete an
acknowledgement statement to this effect.
(b) Content of physician acknowledgement statement. When a claim is
submitted, the hospital must have on file a signed and dated
acknowledgement from the attending physician that the physician has
received the following notice:
Notice to Physicians: Medicare payment to hospitals is based in
part on each patient's principal and secondary diagnoses and the
major procedures performed on the patient, as attested to by the
patient's attending physician by virtue of his or her signature in
the medical record. Anyone who misrepresents, falsifies, or conceals
essential information required for payment of Federal funds, may be
subject to fine, imprisonment, or civil penalty under applicable
Federal laws.
(c) Completion of acknowledgement. The acknowledgement must be
completed by the physician at the time that the physician is granted
admitting privileges at the hospital, or before or at the time the
physician admits his or her first patient. Existing acknowledgements
signed by physicians already on staff remain in effect as long as the
physician has admitting privileges at the hospital.
Subpart D--Basic Methodology for Determining Prospective Payment
Federal Rates for Inpatient Operating Costs
7. In Sec. 412.63, a new paragraph (s)(5) is added to read as
follows:
Sec. 412.63 Federal rates for inpatient operating costs for fiscal
years after Federal fiscal year 1984.
* * * * *
(s) * * *
(5) If a judicial decision reverses a HCFA denial of a hospital's
wage data revision request, HCFA pays the
[[Page 45848]]
hospital by applying a revised wage index that reflects the revised
wage data as if HCFA's decision had been favorable rather than
unfavorable.
Subpart G--Special Treatment of Certain Facilities Under the
Prospective Payment System for Inpatient Operating Costs
Sec. 412.92 [Amended]
8. In paragraph (b)(5) of Sec. 412.92, remove the phrase ``under
Sec. 413.30(e)(1) of this chapter'', wherever it appears.
9. In Sec. 412.96, the first sentence of paragraph (c)(2)(ii) is
revised to read as follows:
Sec. 412.96 Special treatment: Referral centers.
* * * * *
(c) * * *
(2) * * *
(ii) For cost reporting periods beginning on or after January 1,
1986, an osteopathic hospital, recognized by the American Osteopathic
Healthcare Association (or any successor organization), that is located
in a rural area must have at least 3,000 discharges during its most
recently completed cost reporting period to meet the number of
discharges criterion. * * *
* * * * *
10. In Sec. 412.105, paragraph (b) is revised to read as follows:
Sec. 412.105 Special treatment: Hospitals that incur indirect costs
for graduate medical education programs.
* * * * *
(b) Determination of number of beds. For purposes of this section,
the number of beds in a hospital is determined by counting the number
of available bed days during the cost reporting period, not including
beds or bassinets in the healthy newborn nursery, custodial care beds,
or beds in excluded distinct part hospital units, and dividing that
number by the number of days in the cost reporting period.
* * * * *
11. In Sec. 412.106, paragraph (b)(3) is revised to read as
follows:
Sec. 412.106 Special treatment: Hospitals that serve a disproportionate
share of low-income patients.
* * * * *
(b) * * *
(3) First computation: Cost reporting period. If a hospital prefers
that HCFA use its cost reporting period instead of the Federal fiscal
year, it must furnish to HCFA, through its intermediary, a written
request including the hospital's name, provider number, and cost
reporting period end date. This exception will be performed once per
hospital per cost reporting period, and the resulting percentage
becomes the hospital's official Medicare Part A/SSI percentage for that
period.
* * * * *
12. Section 412.109 is amended as follows:
a. Paragraph (a) is revised.
b. Paragraphs (b) through (e) are redesignated as paragraphs (c)
through (f).
c. A new paragraph (b) is added.
d. Redesignated paragraphs (c)(1), (c)(2)(ii), (d) introductory
text, and (d)(1) are revised.
e. The paragraph heading of redesignated paragraph (e) and
redesignated paragraph (e)(1) are revised.
The revisions and addition read as follows:
Sec. 412.109 Special treatment: Essential access community hospitals
(EACHs).
(a) General rule. For payment purposes, HCFA treats as a sole
community hospital any hospital that is located in a rural area as
described in paragraph (b) of this section and that HCFA designates as
an EACH under the criteria in paragraph (c) of this section. The
payment methodology for sole community hospitals is set forth at
Sec. 412.92(d).
(b) Location in a rural area. For purposes of this section, a
hospital is located in a rural area if it--
(1) Is located outside any area that is a Metropolitan Statistical
Area as defined by the Office of Management and Budget or that has been
recognized as urban under Sec. 412.62;
(2) Is not deemed to be located in an urban area under Sec. 412.63;
(3) Is not classified as an urban hospital for purposes of the
standardized payment amount by HCFA or the Medicare Geographic
Classification Review Board; or
(4) Is not located in a rural county that has been redesignated to
an adjacent urban area under Sec. 412.232.
(c) Criteria for HCFA designation. (1) HCFA designates a hospital
as an EACH if the hospital is located in a State that has received a
grant under section 1820(a)(1) of the Act or in an adjacent State and
is designated as an EACH by the State that has received the grant.
* * * * *
(2) * * *
(ii) Is not eligible for State designation solely because the
hospital is located in a rural area, has fewer than 75 beds and is
located 35 miles or less from any other hospital; and
* * * * *
(d) Criteria for State designation. A State that has received a
grant under section 1820(a)(1) of the Act may designate as an EACH any
hospital in the State or in an adjoining State that meets the criteria
of this paragraph (d).
(1) Geographic location. The hospital meets one of the following
requirements:
(i) If it is located in a rural area as described in paragraph (b)
of this section, the hospital is located more than 35 miles from any
hospital that either has been designated as an EACH, or has been
classified as a rural referral center under Sec. 412.96.
(ii) The hospital meets other criteria relating to geographic
location, imposed by the State with HCFA's approval.
* * * * *
(e) Adjustment to the hospital-specific rate for rural EACH's
experiencing increased costs--(1) General rule. HCFA increases the
applicable hospital-specific rate of an EACH that it treats as a sole
community hospital if, during a cost reporting period, the hospital
experiences an increase in its Medicare inpatient operating costs per
discharge that is directly attributable to activities related to its
membership in a rural health network.
* * * * *
Subpart H--Payments to Hospitals Under the Prospective Payment
Systems
Sec. 412.130 [Amended]
13. In paragraph (a)(3) of Sec. 412.130, remove the reference
``Sec. 412.30(b)'' wherever it appears and add, in its place, the
reference ``Sec. 412.30(c)''.
Subpart L--The Medicare Geographic Classification Review Board
14. In Sec. 412.230, paragraph (a)(1) is revised and a new
paragraph (a)(5) is added to read as follows:
Sec. 412.230 Criteria for an individual hospital seeking redesignation
to another rural area or an urban area.
(a) General--(1) Purpose. Except as provided in paragraph (a)(5) of
this section, an individual hospital may be redesignated from a rural
area to an urban area, from a rural area to another rural area, or from
an urban area to another urban area for the purposes of using the other
area's standardized amount for inpatient operating costs, wage index
value, or both.
* * * * *
(5) Limitations on redesignation. The following limitations apply
to redesignation:
(i) An individual hospital may not be redesignated to another area
for purposes of the wage index if the pre-
[[Page 45849]]
reclassified average hourly wage for that area is lower than the pre-
reclassified average hourly wage for the area in which the hospital is
located.
(ii) A hospital may not be redesignated for purposes of the
standardized amount if the area to which the hospital seeks
redesignation does not have a higher standardized amount than the
standardized amount the hospital currently receives.
(iii) A hospital may not be redesignated to more than one area.
* * * * *
15. In Sec. 412.232, a new paragraph (a)(4) is added to read as
follows:
Sec. 412.232 Criteria for all hospitals in a rural county seeking
urban redesignation.
(a) * * *
(4) The hospitals may be redesignated only if one of the following
conditions is met:
(i) The pre-reclassified average hourly wage for the area to which
they seek redesignation is higher than the pre-reclassified average
hourly wage for the area in which they are currently located.
(ii) The standardized amount for the area to which they seek
redesignation is higher than the standardized amount for the area in
which they are located.
* * * * *
16. In Sec. 412.234, a new paragraph (a)(4) is added to read as
follows:
Sec. 412.234 Criteria for all hospitals in an urban county seeking
redesignation to another urban area.
(a) * * *
(4) The hospitals may be redesignated only if one of the following
conditions is met.
(i) The pre-reclassified average hourly wage for the area to which
they seek redesignation is higher than the pre-reclassified average
hourly wage for the area in which they are currently located.
(ii) The standardized amount for the area to which they seek
redesignation is higher than the standardized amount for the area in
which they are currently located.
* * * * *
17. Section 412.266 is revised to read as follows:
Sec. 412.266 Availability of wage data.
A hospital may obtain the average hourly wage data necessary to
prepare its application to the MGCRB from Federal Register documents
published in accordance with the provisions of Sec. 412.8(b).
Subpart M--Prospective Payment System for Inpatient Hospital
Capital Costs
18. In Sec. 412.308, a new paragraph (b)(3) is added and paragraph
(c)(1)(ii) is revised to read as follows:
Sec. 412.308 Determining and updating the Federal rate.
* * * * *
(b) * * *
(3) Effective FY 1996, the standard Federal rate used to determine
the Federal rate each year under paragraph (c) of this section is
reduced by 0.28 percent to account for the effect of the revised policy
for payment of transfers under Sec. 412.4(d).
(c) * * *
(1) * * *
(ii) Effective FY 1996. Effective FY 1996, the standard Federal
rate is updated based on an analytical framework. The framework
includes a capital input price index, which measures the annual change
in the prices associated with capital-related costs during the year.
HCFA adjusts the capital input price index rate of change to take into
account forecast errors, changes in the case mix index, the effect of
changes to DRG classification and relative weights, and allowable
changes in the intensity of hospital services.
* * * * *
19. In Sec. 412.328, a new paragraph (e)(4) is added to read as
follows:
Sec. 412.328 Determining and updating the hospital-specific rate.
* * * * *
(e) * * *
(4) Effective FY 1996, the intermediary reduces the updated amount
determined in paragraph (d) of this section by 0.28 percent to account
for the effect of the revised policy for payment of transfers under
Sec. 412.4(d).
* * * * *
B. Part 413 is amended as follows:
PART 413--PRINCIPLES OF REASONABLE COST REIMBURSEMENT; PAYMENT FOR
END-STAGE RENAL DISEASE SERVICES; OPTIONAL PROSPECTIVELY DETERMINED
PAYMENT RATES FOR SKILLED NURSING FACILITIES
1. The authority citation for part 413 is revised to read as
follows:
Authority: Secs. 1102, 1122, 1814(b), 1815, 1833 (a), (i), and
(n), 1861(v), 1871, 1881, 1883, and 1886 of the Social Security Act
(42 U.S.C. 1302, 1320a-1, 1395f(b), 1395g, 1395l (a), (i), and (n),
1395x(v), 1395hh, 1395rr, 1395tt, and 1395ww).
Subpart C--Limits on Cost Reimbursement
2. Section 413.30 is amended as follows:
a. Paragraph (e) is revised.
b. In paragraph (f) introductory text, the first sentence is
revised.
c. Paragraphs (f)(5), (f)(6), (f)(7), and (f)(9) are removed and
paragraph (f)(8) is redesignated as paragraph (f)(5).
The revisions read as follows:
Sec. 413.30 Limitations on reimbursable costs.
* * * * *
(e) Exemptions. Exemptions from the limits imposed under this
section may be granted to a new provider. A new provider is a provider
of inpatient services that has operated as the type of provider (or the
equivalent) for which it is certified for Medicare, under present and
previous ownership, for less than three full years. An exemption
granted under this paragraph expires at the end of the provider's first
cost reporting period beginning at least two years after the provider
accepts its first patient.
(f) Exceptions. Limits established under this section may be
adjusted upward for a provider under the circumstances specified in
paragraphs (f)(1) through (f)(5) of this section. * * *
* * * * *
Sec. 413.35 [Amended]
3. In paragraph (b)(2) of Sec. 413.35, remove the reference
``Sec. 413.30(e)(2)'' wherever it appears in the paragraph and add, in
its place, the reference ``Sec. 413.30(e)''.
4. Section 413.40 is amended as follows:
a. In Sec. 413.40(c)(2), remove the phrase ``during the 3 days''
wherever it appears in the paragraph and add, in its place, the phrase
``on the calendar day''.
b. Paragraph (e)(1) is revised.
c. A new sentence is added at the end of paragraph (g)(1).
The revision and addition read as follows:
Sec. 413.40 Ceiling on the rate of increase in hospital inpatient
costs.
* * * * *
(e) Hospital requests regarding adjustments to the payment allowed
under the rate-of-increase ceiling--(1) Timing of application. A
hospital may request an adjustment to the rate-of-increase ceiling
imposed under this section. The hospital's request must be received by
the hospital's fiscal intermediary no later than 180 days after the
date on the intermediary's initial notice of amount of program
reimbursement (NPR) for the cost
[[Page 45850]]
reporting period for which the hospital requests an adjustment.
* * * * *
(g) * * *
(1) * * * The amount of payment made to a hospital after an
adjustment under paragraph (e) of this section may not exceed the
difference between the hospital's operating costs and the payment
previously allowed.
* * * * *
Subpart E--Payments to Providers
5. In Sec. 413.70, the first sentence of paragraph (b)(2)(i) is
revised to read as follows:
Sec. 413.70 Payment for services of an RPCH.
* * * * *
(b) * * *
(2) * * * (i) RPCH services. Payment under this method for
outpatient RPCH services is equal to the amounts described in section
1833(a)(2)(B) of the Act (which describes amounts paid for hospital
outpatient services) and subject to the applicable principles of cost
reimbursement in this part and in part 405, subpart D of this chapter,
except for the principle of the lesser of costs or charges in
Sec. 413.13. * * *
* * * * *
C. Part 424 is amended as follows:
PART 424--CONDITIONS FOR MEDICARE PAYMENT
1. The authority citation for part 424 continues to read as
follows:
Authority: Secs. 216(j), 1102, 1814, 1815(c), 1835, 1842(b),
1861, 1866(d), 1870(e) and (f), 1871, 1872 and 1883(d) of the Social
Security Act (42 U.S.C. 416(j), 1302, 1395f, 1395g(c), 1395n,
1395u(b), 1395x, 1395cc(d), 1395gg(e) and (f), 1395hh, 1395ii and
1395tt(d)).
Subpart B--Physician Certification Requirements
2. In Sec. 424.15, paragraph (a) is revised to read as follows:
Sec. 424.15 Requirements for inpatient RPCH services.
(a) Content of certification. Medicare Part A pays for inpatient
RPCH services only if a physician certifies that the individual may
reasonably be expected to be discharged or transferred to a hospital
within 72 hours after admission to the RPCH.
* * * * *
D. Part 485 is amended as follows:
PART 485--CONDITIONS OF PARTICIPATION: SPECIALIZED PROVIDERS
1. The authority citation for part 485 continues to read as
follows:
Authority: Secs. 1102 and 1871 of the Social Security Act (42
U.S.C. 1302 and 1395hh).
Subpart F--Conditions of Participation: Rural Primary Care
Hospitals (RPCHs)
Sec. 485.603 [Amended]
2. In paragraph (a)(2)(i) of Sec. 485.603, remove the reference
``Sec. 412.109(c)'' wherever it appears in the paragraph and add, in
its place, the reference ``Sec. 412.109(d)''.
3. In Sec. 485.606, paragraphs (a)(1), (b)(1), (b)(3), the
paragraph heading of paragraph (c), (c)(1) introductory text,
(c)(1)(i), (c)(2) introductory text, and (c)(2)(ii) are revised to read
as follows:
Sec. 485.606 Designation of RPCHs.
(a) Criteria for State designation--(1) A State that has received a
grant under section 1820(a)(1) of the Act may designate as an RPCH any
hospital that--
(i) Is located in the State that has received the grant, or is
located in an adjoining State and is a member of a rural health network
that also includes one or more facilities located in the State that has
received the grant;
(ii) Meets the RPCH conditions of participation in this subpart F;
and
(iii) Applies to the State that has received the grant for
designation as an RPCH.
* * * * *
(b) Criteria for HCFA designation--(1) HCFA designates a hospital
as an RPCH if the hospital is designated as an RPCH by the State in
which it is located or by an adjoining State that has received a grant.
* * * * *
(3) HCFA may also designate not more than 15 hospitals as RPCHs if
the hospitals are not located in States that have received grants under
section 1820(a)(1) of the Act and meet the requirements of paragraph
(c)(1) of this section.
(c) Special rule: Hospitals not designated by a State as RPCHs--(1)
HCFA may designate not more than 15 hospitals as RPCHs under this
paragraph (c)(1). These hospitals must be located in a State that has
not received a grant under section 1820(a)(1) of the Act, must not have
been designated as RPCHs by a State that has received a grant under
paragraph (a)(1) of this section, and must meet the requirements with
regard to location, participation in the Medicare program, and
emergency services as defined in Secs. 485.610, 485.612, and 485.618,
respectively. In designating a hospital as an RPCH under this paragraph
(c)(1), HCFA--
(i) Gives preference to a hospital that has entered into an
agreement with a rural health network as defined in Sec. 485.603 that
is located in a State that has received a grant under section
1820(a)(1) of the Act; and
* * * * *
(2) HCFA may designate a hospital as an RPCH if the hospital is
located in a State that has received a grant under section 1820(a)(1)
of the Act and is not eligible for State designation under paragraph
(a) of this section solely because the hospital--
* * * * *
(ii) Has more than six inpatient beds or does not maintain an
average length of stay for inpatients not greater than 72 hours for
each 12-month cost reporting period, excluding periods of stays that
exceeded 72 hours because transfer was precluded because of inclement
weather or other emergency conditions, as described in Sec. 485.620; or
* * * * *
4. Section 485.614 is revised to read as follows:
Sec. 485.614 Condition of participation: Termination of inpatient care
services.
(a) General rule. The hospital has ceased providing inpatient
hospital care or has agreed to cease providing inpatient hospital care
upon approval of its application for designation as an RPCH except to
the extent permitted under paragraph (b) of this section.
(b) Limitations on inpatient care--(1) If the RPCH does not have a
swing-bed agreement under Sec. 485.645, it provides not more than six
inpatient beds for providing inpatient RPCH care to patients, but only
if--
(i) The patient requires stabilization before discharge or transfer
to a hospital;
(ii) The patient's attending physician certifies that the patient
may reasonably be expected to be discharged or transferred to a
hospital within 72 hours of admission to the facility; and
(iii) The RPCH complies with the limitation on inpatient surgery
set forth in paragraph (b)(3) of this section.
(2) If the RPCH has a swing-bed agreement under Sec. 485.645, it
provides inpatient RPCH care as described under paragraph (b)(1) of
this section and, under the swing-bed agreement, provides posthospital
SNF care.
(3) The RPCH does not provide any inpatient hospital services
consisting of surgery or any other service requiring the use of general
anesthesia (other than surgical procedures specified by HCFA under
Sec. 416.65 of this chapter), unless the attending physician certifies
that the risk associated with transferring the
[[Page 45851]]
patient to a hospital for such services outweighs the benefits of
transferring the patient to a hospital for such services.
(c) Exception for RPCHs designated by HCFA. If an RPCH is
designated by HCFA under the specific criteria in Sec. 485.606(c), the
RPCH is not subject to the requirements in this section.
5. In Sec. 485.620, paragraph (b) is revised to read as follows:
Sec. 485.620 Condition of participation: Number of beds and length of
stay.
* * * * *
(b) Standard: Length of stay. The RPCH maintains an average length
of stay for inpatients that is not greater than 72 hours for each 12-
month cost reporting period. In determining the average length of stay,
periods of stay of inpatients in excess of 72 hours are not taken into
account to the extent such periods exceed 72 hours because transfer to
a hospital is precluded because of inclement weather or other emergency
conditions.
6. A new Sec. 485.639 is added to read as follows:
Sec. 485.639 Condition of participation: Surgical services.
Surgical procedures must be performed in a safe manner by qualified
practitioners who have been granted clinical privileges by the
governing body of the RPCH in accordance with the designation
requirements under paragraph (a) of this section.
(a) Designation of qualified practitioners. The RPCH designates the
practitioners who are allowed to perform surgery for RPCH patients, in
accordance with its approved policies and procedures, and with State
scope of practice laws. Surgery is performed only by--
(1) A doctor of medicine or osteopathy, including an osteopathic
practitioner recognized under section 1101(a)(7) of the Act;
(2) A doctor of dental surgery or dental medicine; or
(3) A doctor of podiatric medicine.
(b) Anesthetic risk and evaluation. A qualified practitioner, as
described in paragraph (a) of this section, must examine the patient
immediately before surgery to evaluate the risk of anesthesia and of
the procedure to be performed. Before discharge from the RPCH, each
patient must be evaluated for proper anesthesia recovery by a qualified
practitioner as described in paragraph (a) of this section.
(c) Administration of anesthesia. The RPCH designates the person
who is allowed to administer anesthesia to RPCH patients in accordance
with its approved policies and procedures and with State scope of
practice laws.
(1) Anesthetics must be administered only by--
(i) A qualified anesthesiologist;
(ii) A doctor of medicine or osteopathy other than an
anesthesiologist, including an osteopathic practitioner recognized
under section 1101(a)(7) of the Act;
(iii) A doctor of dental surgery or dental medicine;
(iv) A doctor of podiatric medicine;
(v) A certified registered nurse anesthetist, as defined in
Sec. 410.69(b) of this chapter;
(vi) An anesthesiologist's assistant, as defined in Sec. 410.69(b)
of this chapter; or
(vii) A supervised trainee in an approved educational program, as
described in Secs. 413.85 or 413.86 of this chapter.
(2) In those cases in which a certified registered nurse
anesthetist administers the anesthesia, the anesthetist must be under
the supervision of the operating practitioner. An anesthesiologist's
assistant who administers anesthesia must be under the supervision of
an anesthesiologist.
(d) Discharge. All patients are discharged in the company of a
responsible adult, except those exempted by the practitioner who
performed the surgical procedure.
7. In Sec. 485.645, the introductory text and paragraph (a) are
revised, paragraph (b) is redesignated as paragraph (c), and a new
paragraph (b) is added to read as follows:
Sec. 485.645 Special requirements for RPCH providers of long-term care
services.
An RPCH that has a Medicare provider agreement to participate in
Medicare as an RPCH must meet the following requirements in order to be
granted an approval from HCFA to provide post-hospital SNF care, as
specified in Sec. 409.30 of this chapter, and to be paid for SNF-level
services, in accordance with paragraph (b) of this section.
(a) Eligibility. An RPCH must meet the following eligibility
requirements:
(1) Effective October 31, 1994, if an RPCH meets all other
requirements of this section, and applies for approval as a provider of
post-hospital SNF care, the RPCH uses no more beds for providing post-
hospital SNF care than the total number of licensed hospital inpatient
beds at the time it applied to the State for RPCH designation, minus
the number of beds, not to exceed six, used for providing inpatient
RPCH care in accordance with Sec. 485.620(a).
(2) (i) Notwithstanding paragraph (a)(1) of this section, a
hospital that applied for RPCH status before October 31, 1994, and was
designated by the State (or HCFA), and that applied for swing-bed
approval before October 31, 1994, and received approval from HCFA, may
continue in that status under the same terms, conditions, and
limitations that were applicable at the time those approvals were
granted.
(ii) An RPCH that was granted swing-bed approval under paragraph
(a)(2)(i) of this section may request that its application to be an
RPCH and a swing-bed provider be re-evaluated under paragraph (a)(1) of
this section. If this request is approved, the approval is effective
not earlier than October 1994. As of the date of approval, the RPCH no
longer has any status under paragraph (a)(2)(i) of this section, and
may not request re-instatement under paragraph (a)(2)(i) of this
section.
(3) Beds used for post-hospital SNF care in a separately
participating ``distinct part'' unit may not be included in any
determination under this section.
(b) Payment. Payment for inpatient RPCH services to an RPCH that
has qualified as an RPCH under the provisions in paragraph (a) of this
section is made in accordance with Sec. 413.70(a) of this chapter.
Payment for post-hospital SNF-level of care services is made in
accordance with the payment provisions in Sec. 413.114 of this chapter.
* * * * *
E. Part 489 is amended as follows:
PART 489--PROVIDER AGREEMENTS AND SUPPLIER APPROVAL
1. The authority citation for part 489 continues to read as
follows:
Authority: Secs. 1102, 1819, 1861, 1864(m), 1866, and 1871 of
the Social Security Act (42 U.S.C. 1302, 1395i-3, 1395x, 1395aa(m),
1395cc, and 1395hh).
Subpart E--Termination of Agreement and Reinstatement After
Termination
2. In Sec. 489.53, a new paragraph (a)(14) is added to read as
follows:
Sec. 489.53 Termination by HCFA.
(a) * * *
(14) In the case of a rural primary care hospital as defined in
part 485, subpart F of this chapter, the rural primary care hospital
maintains an average length of stay for inpatients in its most recent
12-month cost reporting period that is in excess of 72 hours. In
determining the length of stay of a rural primary care hospital for
purposes of this paragraph, HCFA does not take into account periods of
stay in excess of 72 hours that occurred because transfer to a hospital
[[Page 45852]]
was precluded because of inclement weather or other emergency
conditions.
* * * * *
(Catalog of Federal Domestic Assistance Program No. 93.773,
Medicare--Hospital Insurance; and Program No. 93.774, Medicare--
Supplementary Medical Insurance Program)
Dated: August 23, 1995.
Bruce C. Vladeck,
Administrator, Health Care Financing Administration.
Dated: August 23, 1995.
Donna E. Shalala,
Secretary.
[Editorial Note: The following addendum and appendixes will not
appear in the Code of Federal Regulations.]
Addendum--Schedule of Standardized Amounts Effective with Discharges On
or After October 1, 1995 and Update Factors and Rate-of-Increase
Percentages Effective With Cost Reporting Periods Beginning On or After
October 1, 1995
I. Summary and Background
In this addendum, we are setting forth the amounts and factors for
determining prospective payment rates for Medicare inpatient operating
costs and Medicare inpatient capital-related costs. We are also setting
forth new rate-of-increase percentages for updating the target amounts
for hospitals and hospital units excluded from the prospective payment
system.
For discharges occurring on or after October 1, 1995, except for
sole community hospitals and hospitals located in Puerto Rico, each
hospital's payment per discharge under the prospective payment system
will be based on 100 percent of the Federal national rate.
Sole community hospitals are paid based on whichever of the
following rates yields the greatest aggregate payment: the Federal
national rate, the updated hospital-specific rate based on FY 1982 cost
per discharge, or the updated hospital-specific rate based on FY 1987
cost per discharge. For hospitals in Puerto Rico, the payment per
discharge is based on the sum of 75 percent of a Puerto Rico rate and
25 percent of a national rate (section 1886(d)(9)(A) of the Act).
As discussed below in section II, we are making changes to the
prospective payment rates for Medicare inpatient operating costs. The
changes, to be applied prospectively, will affect the calculation of
the Federal rates. In section III, we discuss changes we are making in
determining the prospective payment rates for Medicare inpatient
capital-related costs. Section IV sets forth our changes for
determining the rate-of-increase limits for hospitals excluded from the
prospective payment system. The tables to which we refer in the
preamble to the final rule are presented at the end of this addendum in
section V.
II. Changes to Prospective Payment Rates For Inpatient Operating Costs
for FY 1996
The basic methodology for determining prospective payment rates for
inpatient operating costs is set forth at Sec. 412.63 for hospitals
located outside of Puerto Rico. The basic methodology for determining
the prospective payment rates for inpatient operating costs for
hospitals located in Puerto Rico is set forth at Secs. 412.210 and
412.212. Below, we discuss the manner in which we are changing some of
the factors used for determining the prospective payment rates. The
Federal and Puerto Rico rate changes are effective for discharges
occurring on or after October 1, 1995. As required by section
1886(d)(4)(C) of the Act, we must also adjust the DRG classifications
and weighting factors for discharges in FY 1996.
In summary, the standardized amounts set forth in Tables 1a, 1b,
and 1c of section V of this addendum reflect--
Updates of 1.5 percent for all areas (that is, the market
basket percentage increase of 3.5 percent minus 2.0 percentage points);
An adjustment to ensure budget neutrality as provided for
in sections 1886(d)(4)(C)(iii) and (d)(3)(E) of the Act by applying new
budget neutrality adjustment factors to the large urban and other
standardized amounts;
An adjustment to ensure budget neutrality as provided for
in section 1886(d)(8)(D) of the Act by removing the FY 1995 budget
neutrality factor and applying a revised factor;
An adjustment to apply the revised outlier offset by
removing the FY 1995 outlier offsets and applying a new offset; and
An adjustment to apply a budget neutrality factor for the
change in the payment methodology for transfer cases.
A. Calculation of Adjusted Standardized Amounts
1. Standardization of Base-Year Costs or Target Amounts
Section 1886(d)(2)(A) of the Act required the establishment of
base-year cost data containing allowable operating costs per discharge
of inpatient hospital services for each hospital. The preamble to the
September 1, 1983 interim final rule (48 FR 39763) contains a detailed
explanation of how base-year cost data were established in the initial
development of standardized amounts for the prospective payment system
and how they are used in computing the Federal rates.
Section 1886(d)(9)(B)(i) of the Act required that Medicare target
amounts be determined for each hospital located in Puerto Rico for its
cost reporting period beginning in FY 1987. The September 1, 1987 final
rule contains a detailed explanation of how the target amounts were
determined and how they are used in computing the Puerto Rico rates (52
FR 33043, 33066).
The standardized amounts are based on per discharge averages of
adjusted hospital costs from a base period or, for Puerto Rico,
adjusted target amounts from a base period, updated and otherwise
adjusted in accordance with the provisions of section 1886(d) of the
Act. Sections 1886(d)(2)(C) and (d)(9)(B)(ii) of the Act required that
the updated base-year per discharge costs and, for Puerto Rico, the
updated target amounts, respectively, be standardized in order to
remove from the cost data the effects of certain sources of variation
in cost among hospitals. These include case mix, differences in area
wage levels, cost of living adjustments for Alaska and Hawaii, indirect
medical education costs, and payments to hospitals serving a
disproportionate share of low-income patients.
Since the standardized amounts have already been adjusted for
differences in case mix, wages, cost-of-living, indirect medical
education costs, and payments to hospitals serving a disproportionate
share of low-income patients, no additional adjustments for these
factors for FY 1996 were made. That is, the standardization adjustments
reflected in the FY 1996 standardized amounts are the same as those
reflected in the FY 1995 standardized amounts.
Sections 1886(d)(2)(H) and (d)(3)(E) of the Act require that, in
making payments under the prospective payment system, the Secretary
adjust the proportion (as estimated by the Secretary from time to time)
of costs that are wages and wage-related costs. Beginning October 1,
1990, when the market basket was rebased, we have considered 71.40
percent of costs to be labor-related for purposes of the prospective
payment system.
2. Computing Large Urban and Other Averages Within Geographic Areas
Section 1886(d)(3) of the Act requires the Secretary to compute two
average standardized amounts for discharges occurring in a fiscal year:
one for
[[Page 45853]]
hospitals located in large urban areas and one for hospitals located in
other areas. In addition, under sections 1886(d)(9)(B)(iii) and (C)(i)
of the Act, the average standardized amount per discharge must be
determined for hospitals located in large urban and other areas in
Puerto Rico. Hospitals in Puerto Rico are paid a blend of 75 percent of
the applicable Puerto Rico standardized amount and 25 percent of a
national standardized payment amount.
Section 1886(d)(2)(D) of the Act defines ``urban areas'' as those
areas within a Metropolitan Statistical Area (MSA). A ``large urban
area'' is defined as an urban area with a population of more than
1,000,000. In addition, section 4009(i) of Public Law 100-203 provides
that a New England County Metropolitan Area (NECMA) with a population
of more than 970,000 is classified as a large urban area. As required
by section 1886(d)(2)(D) of the Act, population size is determined by
the Secretary based on the latest population data published by the
Bureau of the Census. Urban areas that do not meet the definition of a
``large urban area'' are referred to as ``other urban areas.'' Areas
that are not included in MSAs are considered ``rural areas'' under
section 1886(d)(2)(D). Payment for discharges from hospitals located in
large urban areas will be based on the large urban standardized amount.
Payment for discharges from hospitals located in other urban and rural
areas will be based on the other standardized amount.
Based on 1994 population estimates published by the Bureau of the
Census, 57 areas meet the criteria to be defined as large urban areas
for FY 1996. These areas are identified by an asterisk in Table 4a.
Table 1a contains the two national standardized amounts that are
applicable to most hospitals. Table 1b sets forth the 18 regional
standardized amounts that will continue to be applicable for hospitals
located in census areas subject to the regional floor. Under section
1886(d)(9)(A)(ii) of the Act, the national standardized payment amount
applicable to hospitals in Puerto Rico consists of the discharge-
weighted average of the national large urban standardized amount and
the national other standardized amount (as set forth in Table 1a). The
national average standardized amount for Puerto Rico is set forth in
Table 1c. Table 1c also includes the standardized amounts that will be
applicable to most hospitals in Puerto Rico.
We note that on June 30, 1995, the Office of Management and Budget
announced the designation of the Flagstaff, Arizona-Utah MSA and the
Grand Junction, Colorado MSA.
3. Updating the Average Standardized Amounts
In accordance with section 1886(d)(3)(A)(iv) of the Act, we are
updating the large urban and the other areas average standardized
amounts for FY 1996 using the applicable percentage increases specified
in section 1886(b)(3)(B)(i) of the Act. Section 1886(b)(3)(B)(i)(XI) of
the Act specifies that, for hospitals in all areas, the update factor
for the standardized amounts for FY 1996 is the market basket
percentage increase minus 2.0 percentage points.
The percentage change in the market basket reflects the average
change in the price of goods and services purchased by hospitals to
furnish inpatient care. The most recent forecast of the hospital market
basket increase for FY 1996 is 3.5 percent. For FY 1996, this yields an
update to the average standardized amounts of 1.5 percent (3.5 percent
minus 2.0 percent).
As in the past, we are adjusting the FY 1995 standardized amounts
to remove the effects of the FY 1995 geographic reclassifications and
outlier payments before applying the FY 1996 updates. That is, we are
increasing the standardized amounts to restore the reductions that were
made for the effects of geographic reclassification and outliers. After
including the FY 1996 offsets to the standardized amounts for outliers
and geographic reclassification, we estimate that there will be an
actual increase of 1.2 percent to the large urban and other area
standardized amounts.
Beginning in FY 1995, we revised the national average standardized
amounts based on national average labor/nonlabor shares. In FY 1996, we
will continue to adjust the labor and nonlabor proportions of the
standardized amount to reflect the national average. As a result, the
national average labor share (as reflected in the hospital market
basket) will equal 71.4 percent of the standardized payment amounts.
(We are revising the Puerto Rico standardized amounts by the average
labor share in Puerto Rico of 82.8 percent.)
Although the update factor for FY 1996 is set by law, we were
required by section 1886(e)(3)(B) of the Act to report to Congress on
our initial recommendation of update factors for FY 1996 for both
prospective payment hospitals and hospitals excluded from the
prospective payment system. For general information purposes, we
published the report to Congress as Appendix C to the proposed rule, as
revised in the correction notice published on August 2, 1995 (60 FR
39305). That recommendation was based on an earlier forecast of the
market basket increase. Our final recommendation on the update factors
(which is required by sections 1886(e)(4)(A) and (e)(5)(A) of the Act)
is set forth as Appendix C to this final rule.
Comment: One commenter urged that an add-on adjustment of not less
than 7 percent be made to the Puerto Rico standardized amounts to
account for the penalty resulting from the use of temporary cost
allocation methods by government hospitals in Puerto Rico with a
noncharge structure.
Response: At this time, we do not believe it is appropriate to
adjust the standardized amounts of Puerto Rico for those government
hospitals with a noncharge structure. However, as noted in section
III.B.4, we will continue to study the issue of payments to Puerto
Rico.
4. Other Adjustments to the Average Standardized Amounts
a. Recalibration of DRG Weights and Updated Wage Index--Budget
Neutrality Adjustment.
Section 1886(d)(4)(C)(iii) of the Act specifies that beginning in
FY 1991, the annual DRG reclassification and recalibration of the
relative weights must be made in a manner that ensures that aggregate
payments to hospitals are not affected. As discussed in section II of
the preamble, we normalized the recalibrated DRG weights by an
adjustment factor, so that the average case weight after recalibration
is equal to the average case weight prior to recalibration.
Section 1886(d)(3)(E) of the Act specifies that the hospital wage
index must be updated on an annual basis beginning October 1, 1993.
This provision also requires that any updates or adjustments to the
wage index must be made in a manner that ensures that aggregate
payments to hospitals are not affected by the change in the wage index.
To comply with the requirement of section 1886(d)(4)(C)(iii) of the
Act that DRG reclassification and recalibration of the relative weights
be budget neutral and the requirement in section 1886(d)(3)(E) of the
Act that the updated wage index be budget neutral, we compared
aggregate payments using the FY 1995 relative weights and the wage
index effective October 1, 1994, to aggregate payments using the FY
1996 relative weights and wage index. The same methodology was used for
the FYs
[[Page 45854]]
1993, 1994, and 1995 budget neutrality adjustment. Based on this
comparison, we computed a proposed budget neutrality adjustment factor
equal to 0.999174. Based on the final FY 1996 relative weights and wage
index, the final budget neutrality adjustment factor is equal to
0.999306. This budget neutrality adjustment factor is applied to the
standardized amounts without removing the effects of the FY 1995 budget
neutrality adjustment. We do not remove the prior budget neutrality
adjustment because estimated aggregate payments after the changes in
the DRG relative weights and wage index should equal estimated
aggregate payments prior to the changes. If we removed the prior year
adjustment, we would not satisfy this condition.
In addition, we will apply the same FY 1996 adjustment factor to
the hospital-specific rates that are effective for cost reporting
periods beginning on or after October 1, 1995, in order to ensure that
we meet the statutory requirement that aggregate payments neither
increase nor decrease as a result of the implementation of the FY 1996
DRG weights and updated wage index. (See the discussion in the
September 4, 1990 final rule (55 FR 36073).)
Section 1886(d)(5)(I) of the Act, as amended by section 109 of the
Social Security Act Amendments of 1994 (Public Law 103-432), authorizes
the Secretary to make adjustments to the prospective payment system
standardized amounts so that adjustments to the payment policy for
transfer cases do not affect aggregate payments. As discussed in
section IV.A of the preamble of this final rule, we are revising our
payment methodology for transfer cases, so that we will pay double the
per diem amount for the first day of a transfer case, and the per diem
amount for each day after the first, up to the full DRG amount. For the
data that we analyzed, this would result in additional payments for
transfer cases of $159 million. To implement this change in a budget
neutral manner, we adjusted the standardized amounts by applying a
budget neutrality adjustment of 0.997583 in the proposed rule. The
final budget neutrality adjustment factor for this transfer change is
equal to 0.997575. This adjustment will be applied on a one-time basis
to the FY 1996 standardized amounts. After FY 1996, there will be no
need for a further budget neutrality adjustment unless or until we make
further changes to the transfer payment methodology.
b. Reclassified Hospitals--Budget Neutrality Adjustment.
Section 1886(d)(8)(B) of the Act provides that certain rural
hospitals are deemed urban effective with discharges occurring on or
after October 1, 1988. In addition, section 1886(d)(10) of the Act
provides for the reclassification of hospitals based on determinations
by the Medicare Geographic Classification Review Board (MGCRB). Under
section 1886(d)(10), a hospital may be reclassified for purposes of the
standardized amount or the wage index, or both.
Under section 1886(d)(8)(D) of the Act, the Secretary is required
to adjust the standardized amounts so as to ensure that estimated
aggregate payments under the prospective payment system after
implementation of the provisions of sections 1886(d)(8) (B) and (C) and
1886(d)(10) of the Act are equal to the estimated aggregate prospective
payments that would have been made absent these provisions. In the
proposed rule, we applied an adjustment of 0.994125 to ensure that the
effects of reclassification are budget neutral. The final budget
neutrality adjustment factor is 0.994011.
The adjustment factor is applied to the standardized amounts after
removing the effects of the FY 1995 budget neutrality adjustment
factor. We note that the proposed FY 1996 adjustment reflected wage
index and standardized amount reclassifications approved by the MGCRB
or the Administrator as of March 14, 1995. The final budget neutrality
adjustment factor reflects the effects of all reclassification
decisions and changes in these decisions resulting from appeals and
reviews of the MGCRB decisions for FY 1996 or from requests for
withdrawal of a reclassification.
c. Outliers.
Section 1886(d)(5)(A) of the Act provides that, in addition to the
basic prospective payment rates, for discharges occurring before
October 1, 1997, payments must be made for discharges involving day
outliers and may be made for cost outliers. Section 1886(d)(3)(B) of
the Act requires the Secretary to adjust both the large urban and other
areas national standardized amounts by the same factor to account for
the estimated proportion of total DRG payments made to outlier cases.
Section 1886(d)(9)(B)(iv) of the Act requires that the large urban and
other standardized amounts applicable to hospitals in Puerto Rico be
reduced by the proportion of estimated total DRG payments attributable
to estimated outlier payments. Furthermore, under section
1886(d)(5)(A)(iv) of the Act, estimated outlier payments in any year
may not be less than 5 percent nor more than 6 percent of total
payments projected or estimated to be made based on DRG prospective
payment rates.
Beginning with FY 1995, section 1886(d)(5)(A) of the Act requires
the Secretary to reduce the proportion of total outlier payments paid
under the day outlier methodology. Under the requirements of section
1886(d)(5)(A)(v) of the Act, the proportion of outlier payments made
under the day outlier methodology, relative to the proportion of
outlier payments made under the day outlier methodology in FY 1994
(which we estimated at 31.3 percent in our September 1, 1993 final rule
(58 FR 46348)), will be 75 percent in FY 1995, 50 percent in FY 1996,
and 25 percent in FY 1997. For discharges occurring after September 30,
1997, the Secretary will no longer pay for day outliers under the
provisions of section 1886(d)(5)(A)(i) of the Act.
i. FY 1996 Outlier Thresholds.
For FY 1995, the day outlier threshold is the geometric mean length
of stay for each DRG plus the lesser of 22 days or 3.0 standard
deviations. The marginal cost factor for day outliers (or the percent
of Medicare's average per diem payment paid for each outlier day) is
equal to 47 percent in FY 1995. The fixed loss cost outlier threshold
is equal to the prospective payment for the DRG plus $20,500 ($18,800
for hospitals that have not yet entered the prospective payment system
for capital-related costs). The marginal cost factor for cost outliers
(or the percent of costs paid after costs for the case exceed the
threshold) is 80 percent. We applied an outlier adjustment to the FY
1995 standardized amounts of 0.948940 for the large urban and other
areas rates and 0.9414 for the capital Federal rate.
For FY 1996, we proposed to set the day outlier threshold at the
geometric mean length of stay for each DRG plus the lesser of 23 days
or 3.0 standard deviations. We also proposed to reduce the marginal
cost factor for each outlier day from 47 percent to 45 percent in FY
1996. The thresholds that we are establishing in this final rule
continue to be the geometric mean length of stay for each DRG plus the
lesser of 23 days or 3.0 standard deviations. However, based on updated
simulations, we are establishing in this final rule a marginal cost
factor of 44 percent for each outlier day in FY 1996. We estimate that
these policies will reduce the proportion of outlier payments paid to
day outliers to approximately 16 percent in accordance with section
1886(d)(5)(A) of the Act.
We proposed a fixed loss cost outlier threshold in FY 1996 equal to
the prospective payment rate for the DRG plus $16,700 ($15,200 for
hospitals that have not yet entered the prospective
[[Page 45855]]
payment system for capital-related costs). In addition, we proposed to
maintain the marginal cost factor for cost outliers at 80 percent. In
this final rule, based on updated simulations, we are establishing a
fixed loss cost outlier threshold in FY 1996 equal to the prospective
payment rate for the DRG plus $15,150 ($13,800 for hospitals that have
not yet entered the prospective payment system for capital-related
costs). We are also establishing a marginal cost factor for cost
outliers of 80 percent for FY 1996, as proposed.
As provided in section 1886(d)(5)(A)(iv) of the Act, we calculated
outlier thresholds so that estimated outlier payments equal 5.1 percent
of estimated total payments based on DRGs. The model that we use to
determine the outlier thresholds necessary to meet the estimated
outlier payment percentage for FY 1996 uses the June 1995 update of the
FY 1994 MedPAR file and the July 1995 update of the provider-specific
file used in the PRICER program, which contains information on
hospital-specific payment parameters (such as the cost-to-charge
ratios).
In simulating payments, we convert billed charges to costs for
purposes of estimating cost outlier payments. As we explained in the
September 1, 1993 final rule (58 FR 46347), prior to FY 1994, we used a
charge inflation factor to adjust charges to costs; beginning with FY
1994, we are using a cost inflation factor to estimate costs. In other
words, instead of inflating the FY 1994 charge data by a charge
inflation factor for 2 years in order to estimate FY 1996 charge data
and then applying the cost-to-charge ratio, we adjust the charges by
the cost-to-charge ratio and then inflate the estimated costs for 2
years of cost inflation. In this manner, we automatically adjust for
any changes in the cost-to-charge ratios that may occur, since the
relevant variable is the costs estimated for a given case.
In setting the proposed FY 1996 outlier thresholds, we used a cost
inflation factor of 1.02009. In setting the final FY 1996 outlier
thresholds, we used a cost inflation factor of 1.00871. The difference
is attributable to the use of the cost per case increase in cost
reporting periods beginning in FY 1993 (referred to as PPS-X data) in
setting the final FY 1996 outlier thresholds instead of the average
increase in cost per case for cost reporting periods beginning in FY
1991 (PPS-VIII) through PPS-X. This modification was introduced after a
review of the cost per case increase for 2700 hospitals in cost
reporting periods beginning in FY 1994 (PPS-XI). The cost per case
increase from PPS-X to PPS-XI was much closer to the increase from PPS-
IX to PPS-X than the average increase between PPS-VIII through PPS-X.
We believe it is more appropriate to use the increase from PPS-IX to
PPS-X as our cost inflation factor in setting the final FY 1996 outlier
thresholds. In the future, we still plan to use 2-year averages in
computing the cost inflation factors, unless preliminary data from more
recent years indicate that the 2-year average may be inaccurate.
When we modeled the combined operating and capital outlier
payments, we found that using a common set of thresholds resulted in a
lower percentage of outlier payments for capital-related costs than for
operating costs. We estimate the final thresholds for FY 1996 will
result in outlier payments equal to 5.1 percent of operating DRG
payments and 4.6 percent of capital payments based on the Federal rate.
As stated in the September 1, 1993 final rule (58 FR 46348), we
have established outlier thresholds that will be applicable to both
inpatient operating costs and inpatient capital-related costs. As
explained earlier, we are applying a reduction of approximately 5.1
percent to the FY 1996 standardized amounts to account for the
estimated proportion of outliers payments. The proposed outlier
adjustment factors applied to the standardized amounts and the capital
Federal rate for FY 1996 were as follows:
------------------------------------------------------------------------
Capital
Operating standardized amounts Federal
rate
------------------------------------------------------------------------
0.949054..................................................... 0.9526
------------------------------------------------------------------------
The final outlier adjustment factors applied to the standardized
amounts and the capital Federal rate for FY 1996 are as follows:
------------------------------------------------------------------------
Capital
Operating standardized amounts Federal
rate
------------------------------------------------------------------------
0.948950..................................................... 0.9536
------------------------------------------------------------------------
As in the proposed rule, we apply the final outlier adjustment
factors after removing the effects of the FY 1995 outlier adjustment
factors on the standardized amounts and the capital Federal rate.
ii. Other Changes Concerning Outliers.
Table 5 of section V of this addendum contains the DRG relative
weights, geometric and arithmetic mean lengths of stay, as well as the
day outlier threshold for each DRG. When we recalibrate DRG weights, we
set a threshold of 10 cases as the minimum number of cases required to
compute a reasonable weight and geometric mean length of stay. DRGs
that do not have at least 10 cases are considered to be low volume
DRGs. For the low volume DRGs, we use the original geometric mean
lengths of stay, because no arithmetic mean length of stay was
calculated based on the original data.
Table 8a in section V of this addendum contains the updated
Statewide average operating cost-to-charge ratios for urban hospitals
and for rural hospitals to be used in calculating cost outlier payments
for those hospitals for which the intermediary is unable to compute a
reasonable hospital-specific cost-to-charge ratio. Effective October 1,
1995, these Statewide average ratios will replace the ratios published
in the September 1, 1994 final rule (59 FR 45480). Table 8b contains
comparable Statewide average capital cost-to-charge ratios. These
average ratios will be used to calculate cost outlier payments for
those hospitals for which the intermediary computes operating cost-to-
charge ratios lower than 0.25218 or greater than 1.32569 and capital
cost-to-charge ratios lower than 0.012998 or greater than 0.21483. This
range represents 3.0 standard deviations (plus or minus) from the mean
of the log distribution of cost-to-charge ratios for all hospitals. The
cost-to-charge ratios in Tables 8a and 8b will be applied to all
hospital-specific cost-to-charge ratios based on cost report
settlements occurring during FY 1996.
iii. FY 1994 and FY 1995 Outlier Payments.
In the proposed rule, we estimated that actual FY 1994 outlier
payments were approximately 3.5 percent of total DRG payments (60 FR
29260). Our estimates of actual outlier payments and actual total DRG
payments were computed by simulating payments using actual FY 1994 bill
data available at the time of the proposed rule. Our current estimate
remains the same; that is, we estimate that actual FY 1994 outlier
payments were approximately 3.5 percent of actual total DRG payments.
These estimates are based on simulations using the July 1995 update of
the provider-specific file and the June 1995 update of the MedPAR file.
In setting outlier policies for FY 1994, we began using a cost
inflation factor rather than a charge inflation factor to update billed
charges for purposes of estimating outlier payments. This refinement
was made in order to improve our estimation methodology. We believe
that actual FY 1994 outlier payments as a percentage of actual total
[[Page 45856]]
DRG payments may be lower than estimated because actual hospital costs
may be lower than reflected in the estimation methodology. Our most
recent data on hospital costs show a significant trend in declining
rates of increase. Thus, the cost inflation factor of 8.3 percent used
to estimate FY 1994 outlier payments (based on the best available data)
appears to have been overstated. For FY 1995, we used a cost inflation
factor of 2.5 percent. Based on more recent data, we are using a cost
inflation factor of 0.871 percent to calculate outlier payments for FY
1996. Also, although we estimate that FY 1994 outlier payments will
approximate 3.5 percent of total DRG payments, we note that the
estimate of the market basket rate of increase used to set the FY 1994
rates was 4.3 percentage points, while the latest FY 1994 market basket
rate of increase forecast is 2.5 percent. Thus, the net effect is that
total FY 1994 payments are higher than they would have been if the
market basket rate of increase and the outlier percentage were
estimated with precise accuracy.
In the proposed rule (60 FR 29260), we estimated that actual FY
1995 outlier payments would be approximately 4.2 percent of actual FY
1995 total DRG payments. We currently estimate that FY 1995 outlier
payments will approximate 4.0 percent of total DRG payment. This
current estimate is based on simulations using the July 1995 update of
the provider-specific file and the June 1995 update of the FY 1994
MedPAR file.
We believe that there are two main reasons why our current estimate
of FY 1995 outlier payments is below 5.1 percent. First, in setting the
outlier thresholds for FY 1995, we used 2.5 percent as our cost
inflation factor to inflate FY 1993 bills to FY 1995 levels. Our
current estimate of cost inflation is 0.871 percent. Thus, the rate of
increase in costs continues to slow. We note that this factor is
reflected in the estimation methodology used to set thresholds. Thus,
the final FY 1996 cost outlier threshold is lower than the proposed
cost outlier threshold.
Second, in setting the outlier thresholds for FY 1995, we used
cost-to-charge ratios that had a mean value of 0.618. Our current
estimate of cost-to-charge ratios for FY 1995 is down to 0.600. Thus,
not only are costs not rising as fast as we estimated, but they also
make up a lower percentage of charges than we estimated in setting FY
1995 thresholds. We are continuing to explore better ways to forecast
the changes in cost inflation.
Comment: We received a number of comments expressing concern that
the projected percentages of outlier payments for FYs 1994 and 1995 are
lower than estimated when we set the thresholds. Some of the commenters
requested that any difference between outlier payments and the amount
set aside be used to offset the amount required in the next year. Other
commenters requested that we monitor outlier payments during a fiscal
year, so that we can change the thresholds in the middle of the year in
the event that projected outlier payments are not between 5 and 6
percent of total DRG payments.
Response: We responded to similar comments in the final rules for
FY 1993 (57 FR 39784), FY 1994 (58 FR 46347), and FY 1995 (59 FR
45404). In accordance with section 1886(d)(5)(A)(iv) of the Act, we set
the FY 1994 and FY 1995 outlier thresholds so that the estimated
proportion of outlier payments relative to total DRG payments is 5.1
percent. We used the most recent Medicare discharge and hospital-
specific data available to estimate payments. This is necessarily a
prospective process and the resulting estimate may prove to be
inaccurate.
We believe that it would be inappropriate to revise in midyear any
of the payment policies based on estimates. These policies include not
only the outlier thresholds, but also factors such as the market basket
rate of increase used to establish the update factors, the
recalibration of the DRG weights, and the various required budget
neutrality provisions. We also believe it would be inappropriate to
reduce the standardized amounts to account for outlier cases in a
fiscal year by an amount that differs from the estimated proportion of
outlier payments in that fiscal year. Section 1886(d)(3)(B) of the Act
requires the Secretary to ``reduce each of the standardized amounts * *
* by the factor equal to the proportion of payments under this
subsection (as estimated by the Secretary) based on DRG prospective
payment amounts which are additional payments described in paragraph
(5)(A) (relating to outlier payments).'' (Emphasis added.) Thus, if we
estimate that outlier payments will be 5.1 percent of total DRG
payments in an upcoming fiscal year, we must reduce the standardized
amounts by an ``equal'' percentage, not by some lower or higher
percentage.
We believe the more appropriate action is to continue to examine
the outlier policy and try to refine the methodology for setting
outlier thresholds. To that end, as we did in FY 1995, we have
attempted to improve our outlier projections in FY 1996. Normally, we
would use the average increase in cost per case between PPS-VIII and
PPS-X as the cost inflation factor in setting the FY 1996 outlier
thresholds. However, as noted above, after reviewing the preliminary
data for 2700 hospitals from PPS-XI, we found the cost per case
increase of PPS-XI data to be much closer to the PPS-X data than the
PPS-VIII data, indicating a continued downward trend in the rate of
increase in hospital costs. Thus, for FY 1996, we have decided to use
solely the PPS-X cost per case increase of 0.871 percent.
B. Adjustments for Area Wage Levels and Cost of Living
The adjusted standardized amounts are divided into labor and
nonlabor portions. Tables 1a, 1b, and 1c, as set forth in this
addendum, contain the labor-related and nonlabor-related shares used to
calculate the prospective payment rates for hospitals located in the 50
States, the District of Columbia, and Puerto Rico. This section
addresses two types of adjustments to the standardized amounts that are
made in determining the prospective payment rates as described in this
addendum.
1. Adjustment for Area Wage Levels
Sections 1886(d)(3)(E) and 1886(d)(9)(C)(iv) of the Act require
that an adjustment be made to the labor-related portion of the
prospective payment rates to account for area differences in hospital
wage levels. This adjustment is made by multiplying the labor-related
portion of the adjusted standardized amounts by the appropriate wage
index for the area in which the hospital is located. In section III of
the preamble to this final rule, we discuss certain revisions we are
making to the wage index. This index is set forth in Tables 4a through
4e of this addendum.
2. Adjustment for Cost of Living in Alaska and Hawaii
Section 1886(d)(5)(H) of the Act authorizes an adjustment to take
into account the unique circumstances of hospitals in Alaska and
Hawaii. Higher labor-related costs for these two States are taken into
account in the adjustment for area wages described above. For FY 1996,
we are adjusting the payments for hospitals in Alaska and Hawaii by
multiplying the nonlabor portion of the standardized amounts by the
appropriate adjustment factor contained in the table below.
[[Page 45857]]
Table of Cost-of-Living Adjustment Factors, Alaska and Hawaii
Hospitals
Alaska--All areas . . . . . . . . . . . ......................... 1.25
Hawaii:
County of Honolulu . . . . . . . . . .......................... 1.225
County of Hawaii . . . . . . . . . . .......................... 1.15
County of Kauai . . . . . . . . . . ........................... 1.20
County of Maui . . . . . . . . . . . .......................... 1.225
County of Kalawao . . . . . . . . . ........................... 1.225
(The above factors are based on data obtained from the U.S. Office of
Personnel Management.)
C. DRG Relative Weights
As discussed in section II of the preamble to this final rule, we
have developed a classification system for all hospital discharges,
assigning them into DRGs, and have calculated relative weights for each
DRG that reflect the resource utilization of cases in each DRG relative
to Medicare cases in other DRGs.
Table 5 of section V of this addendum contains the relative weights
that we will use for discharges occurring in FY 1996. These factors
have been recalibrated as explained in section II.C of the preamble to
this final rule.
D. Calculation of Prospective Payment Rates for FY 1996
General Formula for Calculation of Prospective Payment Rates for FY
1996
Prospective payment rate for all hospitals located outside Puerto Rico
except sole community hospitals = Federal rate.
Prospective payment rate for sole community hospitals = Whichever of
the following rates yields the greatest aggregate payment: 100 percent
of the Federal rate, 100 percent of the updated FY 1982 hospital-
specific rate, or 100 percent of the updated FY 1987 hospital-specific
rate.
Prospective payment rate for Puerto Rico = 75 percent of the Puerto
Rico rate + 25 percent of a discharge-weighted average of the national
large urban standardized amount and the national other standardized
amount.
1. Federal Rate
For discharges occurring on or after October 1, 1995 and before
October 1, 1996, except for sole community hospitals and hospitals in
Puerto Rico, the hospital's payment is based exclusively on the Federal
rate. Section 1866(d)(1)(A)(iii) of the Act provides that the Federal
rate is comprised of 100 percent of the Federal national rate except
for those hospitals in census regions that have a regional rate that is
higher than the national rate. The Federal rate for hospitals located
in census regions that have a regional rate that is higher than the
national rate equals 85 percent of the Federal national rate plus 15
percent of the Federal regional rate. Based on the final rates, for
discharges occurring on or after October 1, 1995, hospitals in regions
I, IV, and VI are affected by the regional floor.
The Federal rates are determined as follows:
Step 1--Select the appropriate national adjusted standardized
amount considering the type of hospital and designation of the hospital
as large urban or other (see Tables 1a and 1b, section V of this
addendum).
Step 2--Multiply the labor-related portion of the standardized
amount by the applicable wage index for the geographic area in which
the hospital is located (see Tables 4a, 4b, and 4c, section V of this
addendum).
Step 3--For hospitals in Alaska and Hawaii, multiply the nonlabor-
related portion of the standardized amount by the appropriate cost-of-
living adjustment factor.
Step 4--Add the amount from Step 2 and the nonlabor-related portion
of the standardized amount (adjusted if appropriate under Step 3).
Step 5--Multiply the final amount from Step 4 by the relative
weight corresponding to the appropriate DRG (see Table 5, section V of
this addendum).
2. Hospital-Specific Rate (Applicable Only to Sole Community Hospitals)
Sections 1886(d)(5)(D)(i) and (b)(3)(C) of the Act provide that
sole community hospitals are paid based on whichever of the following
rates yields the greatest aggregate payment: the Federal rate, the
updated hospital-specific rate based on FY 1982 cost per discharge, or
the updated hospital-specific rate based on FY 1987 cost per discharge.
Hospital-specific rates have been determined for each of these
hospitals based on both the FY 1982 cost per discharge and the FY 1987
cost per discharge. For a more detailed discussion of the calculation
of the FY 1982 hospital-specific rate and the FY 1987 hospital-specific
rate, we refer the reader to the September 1, 1983 interim final rule
(48 FR 39772); the April 20, 1990 final rule with comment (55 FR
15150); and the September 4, 1990 final rule (55 FR 35994).
a. Updating the FY 1982 and FY 1987 Hospital-Specific Rates for FY
1996.
We are increasing the hospital-specific rates by 1.5 percent (the
hospital market basket percentage increase minus 2.0 percentage points)
for sole community hospitals located in all areas in FY 1996. Section
1886(b)(3)(C)(ii) of the Act provides that the update factor applicable
to the hospital-specific rates for sole community hospitals equals the
update factor provided under section 1886(b)(3)(B)(ii) of the Act,
which, for FY 1996, is the market basket rate of increase minus 2.0
percentage points.
b. Calculation of Hospital-Specific Rate.
For sole community hospitals, the applicable FY 1996 hospital-
specific rate will be calculated by multiplying a hospital's hospital-
specific rate for the preceding fiscal year by the applicable update
factor (1.5 percent), which is the same as the update for all
prospective payment hospitals. In addition, the hospital-specific rate
will be adjusted by the budget neutrality adjustment factor (that is,
0.999306) as discussed in section II.A.4.a of this addendum. This
resulting rate will be used in determining under which rate a sole
community hospital is paid for its discharges beginning on or after
October 1, 1995, based on the formula set forth above.
3. General Formula for Calculation of Prospective Payment Rates for
Hospitals Located in Puerto Rico Beginning On or After October 1, 1995
and Before October 1, 1996
a. Puerto Rico Rate.
The Puerto Rico prospective payment rate is determined as follows:
Step 1--Select the appropriate adjusted average standardized amount
considering the large urban or other designation of the hospital (see
Table 1c, section V of the addendum).
Step 2--Multiply the labor-related portion of the standardized
amount by the appropriate wage index (see Tables 4a and 4b, section V
of the addendum).
Step 3--Add the amount from Step 2 and the nonlabor-related portion
of the standardized amount.
Step 4--Multiply the result in Step 3 by 75 percent.
Step 5--Multiply the amount from Step 4 by the appropriate DRG
relative weight (see Table 5, section V of the addendum).
b. National Rate.
The national prospective payment rate is determined as follows:
Step 1--Multiply the labor-related portion of the national average
standardized amount (see Table 1c, section V of the addendum) by the
appropriate wage index.
[[Page 45858]]
Step 2--Add the amount from Step 1 and the nonlabor-related portion
of the national average standardized amount.
Step 3--Multiply the result in Step 2 by 25 percent.
Step 4--Multiply the amount from Step 3 by the appropriate DRG
relative weight (see Table 5, section V of the addendum).
The sum of the Puerto Rico rate and the national rate computed
above equals the prospective payment for a given discharge for a
hospital located in Puerto Rico.
III. Changes to Payment Rates for Inpatient Capital-Related Costs for
FY 1996
The prospective payment system for hospital inpatient capital-
related costs was implemented for cost reporting periods beginning on
or after October 1, 1991. Effective with that cost reporting period and
during a 10-year transition period extending through FY 2001, hospital
inpatient capital-related costs are paid on the basis of an increasing
proportion of the capital prospective payment system Federal rate and a
decreasing proportion of the hospital's historical costs for capital.
The basic methodology for determining Federal capital prospective
rates is set forth at Secs. 412.308 through 412.352. Below we discuss
the factors that we used to determine the Federal rate and the
hospital-specific rates for FY 1996. The rates will be effective for
discharges occurring on or after October 1, 1995.
For FY 1992, we computed the standard Federal payment rate for
capital-related costs under the prospective payment system by updating
the FY 1989 Medicare inpatient capital cost per case by an actuarial
estimate of the increase in Medicare inpatient capital costs per case.
Each year after FY 1992 we update the standard Federal rate, as
provided in Sec. 412.308(c)(1), to account for capital input price
increases and other factors. Also, Sec. 412.308(c)(2) provides that the
Federal rate is adjusted annually by a factor equal to the estimated
additional payments under the Federal rate for outlier cases,
determined as a proportion of total capital payments under the Federal
rate. Section 412.308(c)(3) further requires that the Federal rate be
reduced by an adjustment factor equal to the estimated additional
payments made for exceptions under Sec. 412.348, and
Sec. 412.308(c)(4)(ii) requires that the Federal rate be adjusted so
that the annual DRG reclassification and the recalibration of DRG
weights and changes in the geographic adjustment factor are budget
neutral. For FY 1992 through FY 1995, Sec. 412.352 required that the
Federal rate also be adjusted by a budget neutrality factor so that
estimated aggregate payments for inpatient hospital capital costs will
equal 90 percent of the estimated payments that would have been made
for capital-related costs on a reasonable cost basis during the fiscal
year. As discussed below, that provision has now expired.
The hospital-specific rate for each hospital was calculated by
dividing the hospital's Medicare inpatient capital-related costs for a
specified base year by its Medicare discharges (adjusted for
transfers), and dividing the result by the hospital's case mix index
(also adjusted for transfers). The resulting case-mix adjusted average
cost per discharge was then updated to FY 1992 based on the national
average increase in Medicare's inpatient capital cost per discharge and
adjusted by the exceptions payment adjustment factor and the budget
neutrality adjustment factor to yield the FY 1992 hospital-specific
rate. The hospital-specific rate is updated each year after FY 1992 for
inflation and for changes in the exceptions payment adjustment factor.
For FY 1992 through FY 1995, the hospital-specific rate was also
adjusted by a budget neutrality adjustment factor.
To determine the appropriate budget neutrality adjustment factors
and the exceptions payment adjustment factor, we developed a dynamic
model of Medicare inpatient capital-related costs, that is, a model
that projects changes in Medicare inpatient capital-related costs over
time. With the expiration of the budget neutrality provision, the model
is still used to estimate the exceptions payment adjustment and other
factors. The model and its application are described more fully in
Appendix B.
In accordance with section 1886(d)(9)(A) of the Act, under the
prospective payment system for inpatient operating costs, hospitals
located in Puerto Rico are paid under a special payment formula. These
hospitals are paid a blended rate that is comprised of 75 percent of
the applicable standardized amount specific to Puerto Rico hospitals
and 25 percent of the applicable national average standardized amount.
Section 412.374 provides for the use of this blended payment system for
payments to Puerto Rico hospitals under the prospective payment system
for inpatient capital-related costs. Accordingly, for capital-related
costs we compute a separate payment rate specific to Puerto Rico
hospitals using the same methodology used to compute the national
Federal rate for capital. Hospitals in Puerto Rico are paid based on 75
percent of the Puerto Rico rate and 25 percent of the Federal rate.
A. Determination of Federal Inpatient Capital-Related Prospective
Payment Rate Update
For FY 1995, the Federal rate was $376.83. In the proposed rule, we
stated that the proposed FY 1996 Federal rate was $457.11. In this
final rule, we are establishing an FY 1996 Federal rate of $461.96.
In the discussion that follows, we explain the factors that were
used to determine the FY 1996 Federal rate. In particular, we explain
why the FY 1996 Federal rate has increased 22.59 percent compared to
the FY 1995 Federal rate. We also explain that aggregate payments for
capital in FY 1996 are estimated to increase by 20.56 percent.
The major factor contributing to the increase in the FY 1996 rate
in comparison to FY 1995 is the expiration of the budget neutrality
requirement. Section 412.352 required that estimated payments each year
from FY 1992 through FY 1995 for capital costs equal 90 percent of the
amount that would have been payable that year on a reasonable cost
basis. Accordingly, each year from FY 1992 through FY 1995, we applied
an adjustment to the Federal rate and the hospital-specific rate so
that estimated capital prospective payments would equal 90 percent of
estimated Medicare hospital inpatient capital-related costs.
Based on the most recent data, we now estimate that capital
payments equalled 95.77 percent of reasonable costs in FY 1992, 90.99
percent of reasonable costs in FY 1993, 90.43 percent of reasonable
costs in FY 1994, and 90.58 percent of reasonable costs in FY 1995.
Thus, the data indicate that the budget neutrality adjustment for FY
1992 was not sufficient to meet the 90-percent target and,
consequently, the Federal rate for FY 1992 was higher than it should
have been. For FY 1993, FY 1994 and FY 1995, however, our estimates are
that payments exceeded the budget neutrality target by less than one
percentage point. We do not retroactively adjust the budget neutrality
factor and the Federal rate for previous years to account for revised
estimates. For FY 1996, we estimate that payments will exceed costs by
3.97 percent as a result of the expiration of the budget neutrality
provision.
As we explain in section III.A.8 below, the predominant factor in
the 22.59 percent increase in the Federal rate, as well as the 20.56
percent increase in payments, is the expiration
[[Page 45859]]
of the budget neutrality provision. For FY 1995, the budget neutrality
adjustment was 0.8432, a 15.68 percent reduction to the rates. The
expiration of that provision alone accounts for an 18.6 percent
increase (1.00/.8432 = 1.186, or 18.6 percent) in the rate. The FY 1996
update factor and changes in the outlier and exceptions factors also
contribute to the increase in the rate. The factors contributing to the
increase in the rate were partially offset by a special adjustment to
the rate to account for the effects of the new transfer policy, and by
the effect of the DRG/GAF reduction factor.
Total payments to hospitals under the prospective payment system
are relatively insensitive even to changes of such magnitude in the
capital Federal rate. Since capital payments constitute about 10
percent of hospital payments, a 1 percent change in the capital Federal
rate yields only about 0.1 percent change in actual payments to
hospitals. Therefore, the large increase in the FY 1996 Federal rate
can be expected to increase total payments to hospitals under the
prospective payment system by only about 2.06 percent.
1. Special Federal Rate Adjustment for the Effects of the New Transfer
Payment Policy
Section 412.312(d) provides that payment under the capital
prospective payment system for transfer cases is made under the same
rules governing transfer payments under the operating prospective
payment system. Transfer cases under the prospective payment system for
capital-related costs have been paid on a per diem basis, using the
full prospective payment amount for the DRG (both Federal rate and
hospital-specific rate, if appropriate) divided by the geometric mean
length of stay for the DRG, but not to exceed the full prospective
payment. Section IV.A of the preamble describes the implementation of a
graduated per diem payment methodology for transfer cases. Beginning in
FY 1996, we will pay double the per diem amount for the first day and
the per diem amount for subsequent days, up to the full prospective
payment amount. Section 109 of the Social Security Amendments of 1994
(Public Law 103-432) authorizes the Secretary to make adjustments to
the operating prospective payment system rates so that adjustments to
the payment policy for transfer cases do not affect aggregate payments.
Section II of the addendum describes the methodology for making the
adjustment to the operating rates.
In order to maintain consistency with the prospective payment
system for operating costs, we believe that a parallel adjustment to
the Federal capital rate and the hospital-specific capital rates is
warranted. In this way, revision of the payment policy for transfer
cases will not affect aggregate payments under the prospective payment
system for capital-related costs. We describe the methodology for
making this adjustment in Appendix B of this final rule. Following that
methodology, we have determined that a special adjustment of .9972
(-0.28 percent) to the standard Federal rate and the hospital-specific
rates is required.
2. Standard Federal Rate Update
Section 412.308(c)(1)(ii) provides that, effective FY 1996, the
standard Federal rate is updated on the basis of an analytical
framework that takes into account changes in a capital input price
index and other factors. We discuss the analytical framework and the
derivation of the final FY 1996 update factor under that framework in
section V.A of the preamble to this final rule. The final update factor
for FY 1996 is 1.2 percent.
3. Outlier Payment Adjustment Factor
Section 412.312(c) establishes a unified outlier methodology for
inpatient operating and inpatient capital-related costs. A single set
of thresholds is used to identify outlier cases for both inpatient
operating and inpatient capital-related payments. Outlier payments are
made only on the portion of the Federal rate that is used to calculate
the hospital's inpatient capital-related payments (for example, 50
percent for cost reporting periods beginning in FY 1996 for hospitals
paid under the fully prospective methodology). Section 412.308(c)(2)
provides that the standard Federal rate for inpatient capital-related
costs be reduced by an adjustment factor equal to the estimated
additional payments under the Federal rate for outlier cases,
determined as a proportion of inpatient capital-related payments under
the Federal rate. The outlier thresholds are set so that estimated
outlier payments are 5.1 percent of estimated total DRG payments. The
inpatient capital-related outlier reduction factor is then set
according to the estimated inpatient capital-related outlier payments
that would be made if all hospitals were paid according to 100 percent
of the Federal rate. For purposes of calculating the outlier thresholds
and the outlier reduction factor, we model all hospitals as if paid 100
percent of the Federal rate because, as explained above, outlier
payments are made only on the portion of the Federal rate that is
included in the hospital's inpatient capital-related payments.
In the September 1, 1994 final rule, we estimated that outlier
payments for capital in FY 1995 would equal 5.86 percent of inpatient
capital-related payments based on the Federal rate. Accordingly, we
applied an outlier adjustment factor of 0.9414 to the Federal rate.
Based on the thresholds as set forth in section II.A.4.d of the
addendum, we estimate that outlier payments will equal 4.64 percent of
inpatient capital-related payments based on the Federal rate in FY
1996. We are, therefore, applying an outlier adjustment factor of
0.9536 to the Federal rate. Thus, estimated capital outlier payments
for FY 1996 represent a lower percentage of total capital payments than
in FY 1995.
The outlier reduction factors are not built permanently into the
rates; that is, they are not applied cumulatively in determining the
Federal rate. Therefore, the net change in the outlier adjustment to
the Federal rate for FY 1996 is 1.0129 (.9536/.9414). Thus, the outlier
adjustment increases the FY 1996 Federal rate by 1.29 percent (1.0129-
1) compared with the FY 1995 outlier adjustment.
4. Budget Neutrality Adjustment Factor for Changes in DRG
Classifications and Weights and the Geographic Adjustment Factor
Section 412.308(c)(4)(ii) requires that the Federal rate be
adjusted so that estimated aggregate payments for the fiscal year based
on the Federal rate after any changes resulting from the annual DRG
reclassification and recalibration and changes in the geographic
adjustment factor equal estimated aggregate payments that would have
been made on the basis of the Federal rate without such changes. We use
the actuarial model described in Appendix B to estimate the aggregate
payments that would have been made on the basis of the Federal rate
without changes in the DRG classifications and weights and in the
geographic adjustment factor. We also use the model to estimate
aggregate payments that would be made on the basis of the Federal rate
as a result of those changes. We then use these figures to compute the
adjustment required to maintain budget neutrality for changes in DRG
weights and in the geographic adjustment factor.
For FY 1995, we calculated a GAF/DRG budget neutrality factor of
0.9998. In the proposed rule for FY 1996, we proposed a GAF/DRG budget
neutrality factor of 0.9993. In this final rule, based on calculations
using updated data, we
[[Page 45860]]
are applying a factor of 0.9994 to meet this requirement. The GAF/DRG
budget neutrality factors are built permanently into the rates; that
is, they are applied cumulatively in determining the Federal rate. This
follows from the requirement that estimated aggregate payments each
year be no more than they would have been in the absence of the annual
DRG reclassification and recalibration and changes in the geographic
adjustment factor. The incremental change in the adjustment from FY
1995 to FY 1996 is 0.9994. The cumulative change in the rate due to
this adjustment is 1.0025 (the product of the incremental factors for
FY 1993, FY 1994, FY 1995, and FY 1996: .9980 x 1.0053 x .9998 x
.9994 = 1.0025).
This factor accounts for DRG reclassifications and recalibration
and for changes in the geographic adjustment factor. It also
incorporates the effects on the geographic adjustment factor of FY 1996
geographic reclassification decisions made by the MGCRB compared to FY
1995 decisions. However, it does not account for changes in payments
due to changes in the disproportionate share and indirect medical
education adjustment factors or in the large urban add-on.
5. Exceptions Payment Adjustment Factor
Section 412.308(c)(3) requires that the standard Federal rate for
inpatient capital-related costs be reduced by an adjustment factor
equal to the estimated additional payments for exceptions under
Sec. 412.348 determined as a proportion of total payments under the
hospital-specific rate and Federal rate. We use the model originally
developed for determining the budget neutrality adjustment factor to
estimate payments under the exceptions payment process and to determine
the exceptions payment adjustment factor. We describe that model in
Appendix B to this final rule.
For FY 1995, we estimated that exceptions payments would equal 2.66
percent of aggregate payments based on the Federal rate and the
hospital-specific rate. Therefore, we applied an exceptions reduction
factor of 0.9734 (1-.0266) in determining the Federal rate. For FY
1996, we estimated in the June 2, 1995, proposed rule that exceptions
payments would equal 1.60 percent of aggregate payments based on the
Federal rate and the hospital-specific rate. Therefore, we proposed to
apply an exceptions reduction factor of 0.9840 (1-0.0160) to determine
the FY 1996 Federal rate. For this final rule, we estimate that
exceptions payments for FY 1996 will equal 1.51 percent of aggregate
payments based on the Federal rate and the hospital-specific rate. We
are, therefore, applying an exceptions payment reduction factor of
0.9849 to the Federal rate for FY 1996.
The final exceptions reduction factor for FY 1996 is thus 1.18
percent higher than the factor for FY 1995, and 0.09 percent higher
than the factor in the FY 1996 proposed rule. The reduced level of
estimated exceptions payments for FY 1996 compared to FY 1995 is a
result of the significant increases in the capital rates and in
aggregate capital payments.
The exceptions reduction factors are not built permanently into the
rates; that is, the factors are not applied cumulatively in determining
the Federal rate. Therefore, the net adjustment to the FY 1996 Federal
rate is .9849/.9734, or 1.0118.
6. Expiration of Budget Neutrality Provision
For FY 1992 through FY 1995, Sec. 412.352 required that the Federal
rate also be adjusted by a budget neutrality factor so that estimated
aggregate payments for inpatient hospital capital costs would equal 90
percent of the estimated payments that would have been made for
capital-related costs on a reasonable cost basis during the fiscal
year. That provision has now expired. The expiration of the budget
neutrality provision is the predominant factor in the 22.59 percent
increase in the Federal rate, as well as the 20.56 percent increase in
payments.
For FY 1995, the budget neutrality adjustment was 0.8432, a 15.68
percent reduction to the rates. The budget neutrality factors were not
built permanently into the rates; that is, the factors were not applied
cumulatively in determining the Federal rate. With the expiration of
the budget neutrality provision, the net adjustment to the rate is thus
1.186 (1.00/.8432=1.186), or 18.6 percent. The expiration of the
provision, therefore, accounts for an 18.6 percent increase in the
rate.
7. Standard Capital Federal Rate for FY 1996
For FY 1995, the capital Federal rate was $376.83. With the changes
we proposed to the factors used to establish the Federal rate, we
proposed that the FY 1996 Federal rate would be $457.11. In this final
rule, we are establishing an FY 1996 Federal rate of $461.96. The final
Federal rate for FY 1996 was calculated as follows:
The FY 1996 special adjustment to the standard Federal
rate to account for the change in transfer payment policy is 0.9972.
The FY 1996 update factor is 1.0120.
The FY 1996 outlier adjustment factor is 0.9536.
The FY 1996 budget neutrality adjustment factor that is
applied to the standard Federal payment rate for changes in the DRG
relative weights and in the geographic adjustment factor is 0.9994.
The FY 1996 exceptions payments adjustment factor is
0.9849.
The expiration of the budget neutrality provision requires
that the FY 1995 budget neutrality adjustment be removed from the rate
without further incremental adjustment.
Since the Federal rate has already been adjusted for differences in
case mix, wages, cost of living, indirect medical education costs, and
payments to hospitals serving a disproportionate share of low-income
patients, we are making no additional adjustments in the standard
Federal rate for these factors other than the budget neutrality factor
for changes in the DRG relative weights and the geographic adjustment
factor.
We are providing a chart that shows how each of the factors and
adjustments for FY 1996 affected the computation of the final FY 1996
Federal rate in comparison to the FY 1995 Federal rate. The special
adjustment to account for the effects of changes in transfer payment
policy has the effect of reducing the rate by 0.28 percent. The final
FY 1996 update factor has the effect of increasing the Federal rate
1.20 percent compared to the rate in FY 1995, while the final
geographic and DRG budget neutrality factor has the effect of
decreasing the Federal rate by 0.06 percent. The final FY 1996 outlier
adjustment factor has the effect of increasing the Federal rate by 1.29
percent compared to FY 1995. The final FY 1996 exceptions reduction
factor has the effect of increasing the Federal rate by 1.18 percent
compared to the exceptions reduction for FY 1995. Finally, the
expiration of the budget neutrality provision has the effect of
increasing the final FY 1996 rate by 18.60 percent compared to the
effect of the budget neutrality reduction in FY 1995. The combined
effect of all the changes is to increase the Federal rate by 22.59
percent compared to the Federal rate for FY 1995.
[[Page 45861]]
Comparison of Factors and Adjustments: FY 1995 Federal Rate and FY 1996
Federal Rate
------------------------------------------------------------------------
Percent
Change change
------------------------------------------------------------------------
Transfer adjustment:
FY 1995......................... N/A ..........
FY 1996......................... 0.9972 0.9972 -0.28
Update factor \1\:
FY 1995......................... 1.0344 .......... ..........
FY 1996......................... 1.0120 1.0120 1.20
GAF/DRG adjustment factor: \1\
FY 1995......................... 0.9998 .......... ..........
FY 1996......................... 0.9994 0.9994 -0.06
Outlier adjustment factor:\2\
FY 1995......................... 0.9414 .......... ..........
FY 1996......................... 0.9536 1.0129 1.29
Exceptions adjustment factor: \2\
FY 1995......................... 0.9734 .......... ..........
FY 1996......................... 0.9849 1.0118 1.18
Budget neutrality adjustment factor:
\2\
FY 1995......................... 0.8432 .......... ..........
FY 1996......................... 1.0000 1.1860 18.60
Federal Rate:
FY 1995......................... $376.83 .......... ..........
FY 1996......................... $461.96 1.2259 22.59
------------------------------------------------------------------------
\1\ The update factor and the GAF/DRG budget neutrality factors are
built permanently into the rates. Thus, for example, the incremental
change from FY 1995 to FY 1996 resulting from the application of the
0.9994 GAF/DRG budget neutrality factor for FY 1996 is 0.9994.
\2\ The outlier reduction factor and the exceptions reduction factor are
not built permanently into the rates; that is, these factors are not
applied cumulatively in determining the rates. Thus, for example, the
net change resulting from the application of the FY 1996 exceptions
reduction factor is 0.9849/0.9734, or 1.0118. The result of the
expiration of budget neutrality is that the FY 1995 budget neutrality
factor is removed from the rate without further incremental adjustment
(i.e., the FY 1996 adjustment of .8432 is divided out of the rate
without further adjustment, for a net adjustment of 1.0000/.8432, or
1.1860).
We are also providing a chart that shows how the final FY 1996
Federal rate differs from the proposed FY 1996 Federal rate.
This chart shows that the major factor in the 1.06 percent increase
in the rate since the proposed rule is the 1.15 percent increase due to
our decision not to implement the proposed tax adjustment factor at
this time. We discuss our reasons for this decision in section V.B. of
the preamble. As the chart shows, the effect of this change, when
compared to the proposed FY 1996 Federal rate, is to increase the rate
by 1.15 percent. In addition, there have been small changes in the
outlier and exceptions factors that contribute to the small increase in
the rate. As the chart also shows, the effect of these changes was
partially offset by a decrease in the final update factor compared to
the update factor in the proposed rule.
Comparison of Factors and Adjustments: Proposed FY 1996 Federal Rate and
Final FY 1996 Federal Rate
------------------------------------------------------------------------
Net Percent
adjustment change
------------------------------------------------------------------------
Update factor:
Proposed FY 1996............... 1.0150 ........... ..........
Final FY 1996.................. 1.0120 0.9970 -0.30
Transfer adjustment:
Proposed FY 1996............... 0.9972 ........... ..........
Final FY 1996.................. 0.9972 1.0000 0.00
Tax adjustment:
Proposed FY 1996............... 0.9886 ........... ..........
Final FY 1996.................. 1.0000 1.0115 1.15
Outlier reduction factor:
Proposed FY 1996............... 0.9526 ........... ..........
Final FY 1996.................. 0.9536 1.0010 0.10
GAF/DRG reduction factor:
Proposed FY 1996............... 0.9993 ........... ..........
Final FY 1996.................. 0.9994 1.0001 0.01
Exceptions reduction factor:
Proposed FY 1996............... 0.9840 ........... ..........
Final FY 1996.................. 0.9849 1.0009 0.09
Budget neutrality adjustment
factor:
Proposed FY 1996............... 1.0000 ........... ..........
Final FY 1996.................. 1.0000 1.0000 0.00
Federal rate:
Proposed FY 1996............... $457.11 ........... ..........
Final FY 1996.................. $461.96 1.0106 1.06
------------------------------------------------------------------------
[[Page 45862]]
8. Special Rate for Puerto Rico Hospitals
For FY 1995, the special rate for Puerto Rico hospitals was
$289.87. With the changes we proposed making to the factors used to
determine the rate, the proposed FY 1996 special rate for Puerto Rico
was $351.61. In this final rule, the FY 1996 capital rate for Puerto
Rico is $355.35.
B. Determination of Hospital-Specific Rate Update
Section 412.328(e) of the regulations provides that the hospital-
specific rate for FY 1996 be determined by adjusting the FY 1995
hospital-specific rate by the following factors:
1. Special Adjustment for the Effects of the New Transfer Policy
Section 412.312(d) of the regulations provides that payment under
the capital prospective payment system for transfer cases is made under
the same rules governing transfer payments under the operating
prospective payment system. Transfer cases under the prospective
payment system for capital-related costs have been paid on a per diem
basis, using the full prospective payment amount for the DRG (both
Federal rate and hospital-specific rate, if appropriate) divided by the
geometric mean length of stay for the DRG, but not to exceed the full
prospective payment. Section IV.A of the preamble to this final rule
describes our adoption of a graduated per diem payment methodology for
transfer cases. Under this policy, we will pay double the per diem
amount for the first day and the per diem amount for subsequent days,
up to the full prospective payment amount. Section 109 of the Social
Security Amendments of 1994 (Public Law 103-432) authorizes the
Secretary to make adjustments to the operating prospective payment
system rates so that adjustments to the payment policy for transfer
cases do not affect aggregate payments. Section II of this Addendum
describes the methodology for making the adjustment to the operating
rates.
In order to maintain consistency with the prospective payment
system for operating costs, we believe that a parallel adjustment to
the Federal capital rate and the hospital-specific capital rates is
warranted. In this way, revision of the payment policy for transfer
cases will not affect aggregate payments under the prospective payment
system for capital-related costs. We describe the methodology for
making this adjustment in Appendix B of this proposed rule. Following
that methodology, we have determined that a special adjustment of
0.9972 (-0.28 percent) to the standard Federal rate and the hospital-
specific rates is required. We have revised Sec. 412.328(e)
accordingly.
2. Hospital-Specific Rate Update Factor
The hospital-specific rate is updated in accordance with the update
factor for the standard Federal rate determined under
Sec. 412.308(c)(1). For FY 1996, the hospital-specific rate will be
updated by a factor of 1.012.
3. Exceptions Payment Adjustment Factor
For FY 1992 through FY 2001, the updated hospital-specific rate is
multiplied by an adjustment factor to account for estimated exceptions
payments for capital-related costs under Sec. 412.348, determined as a
proportion of the total amount of payments under the hospital-specific
rate and the Federal rate. For FY 1996, we estimated in the proposed
rule that exceptions payments would be 1.60 percent of aggregate
payments based on the Federal rate and the hospital-specific rate. We
therefore proposed that the updated hospital-specific rate be reduced
by a factor of 0.9840. In this final rule, we estimate that exceptions
payments will be 1.51 percent of aggregate payments based on the
Federal rate and the hospital-specific rate. We are therefore applying
an exceptions reduction factor of 0.9849 to the hospital-specific rate.
The exceptions reduction factors are not built permanently into the
rates; that is, the factors are not applied cumulatively in determining
the hospital-specific rate. Therefore, the proposed net adjustment to
the FY 1996 hospital-specific rate is .9849/.9734, or 1.0118.
4. Expiration of the Budget Neutrality Provision
For FY 1992 through FY 1995, the updated hospital-specific rate was
adjusted by a budget neutrality adjustment factor determined under
Sec. 412.352, so that estimated aggregate payments under the capital
prospective payment system would equal 90 percent of estimated payments
that would have been made on a reasonable cost basis. (The budget
neutrality adjustment for changes in the DRG classifications and
relative weights and in the geographic adjustment factor is not applied
to the hospital-specific rate.) For FY 1995, the budget neutrality
adjustment was 0.8432. The budget neutrality provision has now expired.
Therefore, for FY 1996 there is no budget neutrality adjustment. The
budget neutrality factor was not built permanently into the rates; that
is, the factor was not applied cumulatively in determining the
hospital-specific rate. Therefore, the net adjustment to the FY 1996
hospital-specific rate as a result of the expiration of the budget
neutrality provision is 1.0000/.8432, or 1.1860.
5. Net Change to Hospital-Specific Rate
We are providing a chart to show the net change to the hospital-
specific rate. The chart shows the factors for FY 1995 and FY 1996 and
the net adjustment for each factor. It also shows that the proposed
cumulative net adjustment from FY 1995 to FY 1996 is 1.2110, which
represents an increase of 21.10 percent to the hospital-specific rate.
The FY 1996 hospital-specific rate for each hospital is determined by
multiplying the FY 1995 hospital-specific rate by the cumulative net
adjustment of 1.2110.
FY 1996 Update and Adjustments to Hospital-Specific Rates
------------------------------------------------------------------------
Net Percent
adjustment change
------------------------------------------------------------------------
Update factor:
FY 1995........................ 1.0344 ........... ..........
FY 1996........................ 1.0120 1.0120 1.20
Transfer adjustment:
FY 1995........................ N/A
FY 1996........................ 0.9972 0.9972 -0.28
Exceptions payment adjustment
factor:
FY 1995........................ 0.9734 ........... ..........
FY 1996........................ 0.9849 1.0118 1.18
Budget neutrality factor:
FY 1995........................ 0.8432 ........... ..........
[[Page 45863]]
FY 1996........................ 1.0000 1.1860 18.60
Cumulative adjustments:
FY 1995........................ 0.8457 ........... ..........
FY 1996........................ 1.0241 1.2110 21.10
------------------------------------------------------------------------
Note: The update factor for the hospital-specific rate is
applied cumulatively in determining the rates. Thus, the incremental
increase in the update factor from FY 1995 to FY 1996 is 1.0120. In
contrast, the exceptions payment adjustment factor and the budget
neutrality factor are not applied cumulatively. Thus, for example,
the incremental increase in the exceptions reduction factor from FY
1995 to FY 1996 is .9849/.9734, or 1.0118.
C. Calculation of Inpatient Capital-Related Prospective Payments for FY
1996
During the capital prospective payment system transition period, a
hospital is paid for inpatient capital-related costs under one of two
alternative payment methodologies: the fully prospective payment
methodology or the hold-harmless methodology. The payment methodology
applicable to a particular hospital is determined when a hospital comes
under the prospective payment system for capital-related costs by
comparing its hospital-specific rate to the Federal rate applicable to
the hospital's first cost reporting period under the prospective
payment system. The applicable Federal rate was determined by
adjusting:
For outliers by dividing the standard Federal rate by the
outlier reduction factor for that fiscal year; and,
For the payment adjustment factors applicable to the
hospital (that is, the hospital's geographic adjustment factor, the
disproportionate share adjustment factor, and the indirect medical
education adjustment factor, when appropriate).
If the hospital-specific rate is above the applicable Federal rate,
the hospital is paid under the hold-harmless methodology. If the
hospital-specific rate is below the applicable Federal rate, the
hospital is paid under the fully prospective methodology.
For purposes of calculating payments for each discharge under both
the hold-harmless payment methodology and the fully prospective payment
methodology, the standard Federal rate is adjusted as follows:
(Standard Federal Rate) x (DRG weight) x (Geographic Adjustment
Factor) x (Large Urban Add-on, if applicable) x (COLA adjustment
for hospitals located in Alaska and Hawaii) x (1 + Disproportionate
Share Adjustment Factor + Indirect Medical Education Adjustment Factor,
if applicable).
The result is termed the adjusted Federal rate.
Payments under the hold-harmless methodology are determined under
one of two formulas. A hold-harmless hospital is paid the higher of:
100 percent of the adjusted Federal rate for each
discharge; or
An old capital payment equal to 85 percent (100 percent
for sole community hospitals) of the hospital's allowable Medicare
inpatient old capital costs per discharge for the cost reporting period
plus a new capital payment based on a percentage of the adjusted
Federal rate for each discharge. The percentage of the adjusted Federal
rate equals the ratio of the hospital's allowable Medicare new capital
costs to its total Medicare inpatient capital-related costs in the cost
reporting period.
Once a hospital receives payment based on 100 percent of the
adjusted Federal rate in a cost reporting period beginning on or after
October 1, 1994 (or the first cost reporting period after obligated
capital that is recognized as old capital under Sec. 412.302(c) is put
in use for patient care, if later), the hospital continues to receive
capital prospective payment system payments on that basis for the
remainder of the transition period.
Payment for each discharge under the fully prospective methodology
is the sum of:
The hospital-specific rate multiplied by the DRG relative
weight for the discharge and by the applicable hospital-specific
transition blend percentage for the cost reporting period; and
The adjusted Federal rate multiplied by the Federal
transition blend percentage.
The blend percentages for cost reporting periods beginning in FY
1996 are 50 percent of the adjusted Federal rate and 50 percent of the
hospital-specific rate.
Hospitals may also receive outlier payments for those cases that
qualify under the thresholds established for each fiscal year. Section
412.312(c) provides for a single set of thresholds to identify outlier
cases for both inpatient operating and inpatient capital-related
payments. Outlier payments are made only on that portion of the
hospital's inpatient capital-related payments that is based on the
Federal rate. For fully prospective hospitals, that portion is 50
percent Federal rate for discharges occurring in cost reporting periods
beginning during FY 1996. Thus, a fully prospective hospital will
receive 50 percent of the capital-related outlier payment calculated
for the case for discharges occurring in cost reporting periods
beginning in FY 1996. For hold-harmless hospitals paid 85 percent of
their reasonable costs for old inpatient capital, the portion of the
Federal rate that is included in the hospital's outlier payments is
based on the hospital's ratio of Medicare inpatient costs for new
capital to total Medicare inpatient capital costs. For hold-harmless
hospitals that are paid based on 100 percent of the Federal rate, 100
percent of the Federal rate is included in the hospital's outlier
payments.
The outlier thresholds for FY 1996 are published in section
II.A.4.c of this Addendum. For FY 1996, a case qualifies as a cost
outlier if the cost for the case (after standardization for the
indirect teaching adjustment and disproportionate share adjustment) is
greater than the prospective payment rate for the DRG plus $15,150. A
case qualifies as a day outlier for FY 1996 if the length of stay is
greater than the geometric mean length of stay for the DRG plus the
lesser of three standard deviations of the length of stay or 23 days.
During the capital prospective payment system transition period, a
hospital may also receive an additional payment under an exceptions
process if its total inpatient capital-related payments are less than a
minimum percentage of its allowable Medicare inpatient capital-related
costs. The minimum payment level is established by class of hospital
under Sec. 412.348. The minimum payment levels for portions of cost
reporting periods occurring in FY 1996 are:
[[Page 45864]]
Sole community hospitals (located in either an urban or
rural area), 90 percent;
Urban hospitals with at least 100 beds and a
disproportionate share patient percentage of at least 20.2 percent and
urban hospitals with at least 100 beds that qualify for
disproportionate share payments under Sec. 412.106(c)(2), 80 percent;
and,
All other hospitals, 70 percent.
Under Sec. 412.348(d), the amount of the exceptions payment is
determined by comparing the cumulative payments made to the hospital
under the capital prospective payment system to the cumulative minimum
payment levels applicable to the hospital for each cost reporting
period subject to that system. Any amount by which the hospital's
cumulative payments exceed its cumulative minimum payment is deducted
from the additional payment that would otherwise be payable for a cost
reporting period.
New hospitals are exempted from the capital prospective payment
system for their first 2 years of operation and are paid 85 percent of
their reasonable costs during that period. A new hospital's old capital
costs are its allowable costs for capital assets that were put in use
for patient care on or before the later of December 31, 1990 or the
last day of the hospital's base year cost reporting period, and are
subject to the rules pertaining to old capital and obligated capital as
of the applicable date. Effective with the third year of operation, we
will pay the hospital under either the fully prospective methodology,
using the appropriate transition blend in that Federal fiscal year, or
the hold-harmless methodology. If the hold-harmless methodology is
applicable, the hold-harmless payment for assets in use during the base
period would extend for 8 years, even if the hold-harmless payments
extend beyond the normal transition period.
IV. Changes for Excluded Hospitals and Units
A. Rate-of-Increase Percentages for Excluded Hospitals and Units
The inpatient operating costs of hospitals and hospital units
excluded from the prospective payment system are subject to rate-of-
increase limits established under the authority of section 1886(b) of
the Act, which is implemented in Sec. 413.40 of the regulations. Under
these limits, an annual target amount (expressed in terms of the
inpatient operating cost per discharge) is set for each hospital, based
on the hospital's own historical cost experience trended forward by the
applicable rate-of-increase percentages (update factors). The target
amount is multiplied by the number of Medicare discharges in a
hospital's cost reporting period, yielding the ceiling on aggregate
Medicare inpatient operating costs for the cost reporting period.
Effective with cost reporting periods beginning on or after October
1, 1991, a hospital that has Medicare inpatient operating costs in
excess of its ceiling is paid its ceiling plus 50 percent of its costs
in excess of the ceiling. Total payment may not exceed 110 percent of
the ceiling. A hospital that has inpatient operating costs less than
its ceiling will continue to be paid its costs plus the lower of--
Fifty percent of the difference between the allowable
inpatient operating costs and the ceiling; or
Five percent of the ceiling.
Each hospital's target amount is adjusted annually, at the
beginning of its cost reporting period, by an applicable rate-of-
increase percentage. Section 13502 of Public Law 103-66 amended section
1886(b)(3)(B) of the Act to provide that for cost reporting periods
beginning on or after October 1, 1993 and before October 1, 1994, the
applicable rate-of-increase percentage is the market basket percentage
increase minus the lesser of one percentage point, or the percentage
point difference between 10 percent and the hospital's ``update
adjustment percentage'' except for hospitals with an ``update
adjustment percentage'' of at least 10 percent. The rate-of-increase
percentage for hospitals in the latter case will be the market basket
percentage increase. The ``update adjustment percentage'' is the
percentage by which a hospital's allowable inpatient operating costs
exceeds the hospital's ceiling for the cost reporting period beginning
in Federal fiscal year 1990. For cost reporting periods beginning on or
after October 1, 1994 and before October 1, 1997, the update adjustment
percentage is the update adjustment percentage from the previous year
plus the previous year's applicable reduction. The applicable reduction
and applicable rate-of-increase percentage are then determined in the
same manner as for FY 1994. The most recent forecasted market basket
increase for FY 1996 for hospitals and hospital units excluded from the
prospective payment system is 3.4 percent.
B. Wage Index Exceptions for Excluded Hospitals and Units
In the August 30, 1991 final rule (56 FR 43232), we set forth our
policy for target amount adjustments for significant wage increases.
Effective with cost reporting periods beginning on or after April 1,
1990, significant increases in wages since the base period are
recognized as a basis for an adjustment in the target amount under
Sec. 413.40(g).
To qualify for an adjustment, the excluded hospital or hospital
unit must be located in a labor market area for which the average
hourly wage increased significantly more than the national average
hourly wage between the hospital's base period and the period subject
to the ceiling. We use the hospital wage index for prospective payment
hospitals to determine the rate of increase in the average hourly wage
in the labor market area. For a hospital to qualify for an adjustment,
the wage index value for the cost reporting period subject to the
ceiling must be at least 8 percent higher than the wage index based on
wage survey data collected for the base year cost reporting period. If
survey data are not available for one (or both) of the cost reporting
periods used in the comparison, the wage index based on the latest
available survey data collected before that cost reporting period will
be used. For example, to make the comparison between a 1983 base period
and a hospital's cost reporting period beginning in FY 1993, we would
use the rate of increase between the wage index based on 1982 wage data
and the wage index based on the FY 1992 data, since the FY 1992 data
are the most recent data that are currently available. Further, the
comparison is made without regard to geographic reclassifications made
by the MGCRB under sections 1886(d) (8) and (10) of the Act. Therefore,
the comparison is made based on the wage index value of the labor
market area in which the hospital is actually located.
We determine the amount of the adjustment for wage increases by
considering three factors for the time between the base period and the
period for which an adjustment is requested: the rate of increase in
the hospital's average hourly wage; the rate of increase in the average
hourly wage in the labor market area in which the hospital is located;
and, the rate of increase in the national average hourly wage for
hospital workers. The adjustment is limited to the amount by which the
lower of the hospital's or the labor market area's rate of increase in
average hourly wages significantly exceeds the national increase (that
is, exceeds the national rate of increase by more than 8 percent). For
purposes of computing the adjustment, the relative rate of increase in
the average hourly wage for the labor market area is assumed to have
been the
[[Page 45865]]
same over each of the intervening years between the wage surveys.
To determine the rate of increase in the national average hourly
wage, we use the average hourly earnings (AHE) component of the wages
and salaries portion of the market basket. This measure is derived from
the 1982-based market basket since the 1987-based market basket uses
the employment cost index (ECI) for hospital workers as the price proxy
for this component. Unlike the AHE, the ECI for hospital workers can be
measured historically only back to 1986. In addition, the ECI does not
adjust for skill-mix shifts and, therefore, measures only the change in
wage rates per hour.
The average hourly earnings for hospital workers as measured by the
market basket show the following increases:
1992 = 4.8 percent
1993 = 3.7 percent
1994 = 2.8 percent
1995 = 3.4 percent
1996 = 4.3 percent
We note that this section merely provides updated information with
respect to areas that would qualify for the wage index adjustment under
Sec. 413.30(g). This information was calculated in accordance with
established policy and does not reflect any change in that policy. The
geographic areas in which the percentage difference in wage indexes was
sufficient to qualify for a wage index adjustment are listed in Table
10 of section V of the addendum to this final rule. The table is
constructed with old MSAs instead of the revised MSAs effective October
1, 1993 because current adjustment requests are for years prior to FY
1995.
V. Tables
This section contains the tables referred to throughout the
preamble to this final rule and in this addendum. For purposes of this
final rule, and to avoid confusion, we have retained the designations
of Tables 1 through 5 that were first used in the September 1, 1983
initial prospective payment final rule (48 FR 39844). Tables 1a, 1b,
1c, 1d, 3C, 4a, 4b, 4c, 4d, 4e, 5, 6a, 6b, 6c, 6d, 6e, 6f, 6G, 6H, 7A,
7B, 8A, 8B, and 10 are presented below. The tables presented below are
as follows:
Table 1a--National Adjusted Operating Standardized Amounts, Labor/
Nonlabor
Table 1b--Regional Adjusted Operating Standardized Amounts, Labor/
Nonlabor
Table 1c--Adjusted Operating Standardized Amounts for Puerto Rico,
Labor/Nonlabor
Table 1d--Capital Standard Federal Payment Rate
Table 3C--Hospital Case Mix Indexes for Discharges Occurring in Federal
Fiscal Year 1994 and Hospital Average Hourly Wage for Federal Fiscal
Year 1996 Wage Index
Table 4a--Wage Index and Capital Geographic Adjustment Factor (GAF) for
Urban Areas
Table 4b--Wage Index and Capital Geographic Adjustment Factor (GAF) for
Rural Areas
Table 4c--Wage Index and Capital Geographic Adjustment Factor (GAF) for
Hospitals That Are Reclassified
Table 4d--Average Hourly Wage for Urban Areas
Table 4e--Average Hourly Wage for Rural Areas
Table 5--List of Diagnosis Related Groups (DRGs), Relative Weighting
Factors, Geometric Mean Length of Stay, and Length of Stay Outlier
Cutoff Points Used in the Prospective Payment System
Table 6a--New Diagnosis Codes
Table 6b--New Procedure Codes
Table 6c--Invalid Diagnosis Codes
Table 6d--Invalid Procedure Codes
Table 6e--Revised Diagnosis Code Titles
Table 6f--Revised Procedure Code Titles
Table 6G--Additions to the CC Exclusions List
Table 6H--Deletions to the CC Exclusions List
Table 7A--Medicare Prospective Payment System Selected Percentile
Lengths of Stay FY 95 MEDPAR Update 06/95 GROUPER V12.0
Table 7B--Medicare Prospective Payment System Selected Percentile
Lengths of Stay FY 94 MEDPAR Update 06/95 GROUPER V13.0
Table 8A--Statewide Average Operating Cost-to-Charge Ratios for Urban
and Rural Hospitals (Case Weighted) August 1995
Table 8B--Statewide Average Capital Cost-to-Charge Ratios for Urban and
Rural Hospitals (Case Weighted) August 1995
Table 10--Percentage Difference in Wage Indexes for Areas That Qualify
for a Wage Index Exception for Excluded Hospitals and Units
Table 1a.--National Adjusted Operating Standardized Amounts, Labor/
Nonlabor
------------------------------------------------------------------------
Large urban areas Other areas
------------------------------------------------------------------------
Labor-related Nonlabor-related Labor-related Nonlabor-related
------------------------------------------------------------------------
$2,741.39........ $1,098.09 $2,697.99 $1,080.71
------------------------------------------------------------------------
Table 1b.--Regional Adjusted Operating Standardized Amounts, Labor/Nonlabor
----------------------------------------------------------------------------------------------------------------
Large urban areas Other areas
---------------------------------------------------------------
Nonlabor- Nonlabor-
Labor- related related Labor- related related
----------------------------------------------------------------------------------------------------------------
1. New England (CT, ME, MA, NH, RI, VT)......... $2,874.14 $1,151.27 $2,828.62 $1,133.04
2. Middle Atlantic (PA, NJ, NY)................. 2,623.06 1,050.69 2,581.53 1,034.06
3. South Atlantic (DE, DC, FL, GA, MD, NC, SC,
VA, WV)........................................ 2,685.62 1,075.75 2,643.11 1,058.72
4. East North Central (IL, IN, MI, OH, WI)...... 2,926.45 1,172.22 2,880.12 1,153.66
5. East South Central (AL, KY, MS, TN).......... 2,537.85 1,016.56 2,497.67 1,000.47
6. West North Central (IA, KS, MN, MO, NE, ND,
SD)............................................ 2,743.19 1,098.81 2,699.76 1,081.41
7. West South Central (AR, LA, OK, TX).......... 2,669.98 1,069.49 2,627.71 1,052.55
8. Mountain (AZ, CO, ID, MT, NV, NM, UT, WY).... 2,652.82 1,062.62 2,610.82 1,045.79
9. Pacific (AK, CA, HI, OR, WA)................. 2,712.20 1,086.40 2,669.27 1,069.20
----------------------------------------------------------------------------------------------------------------
[[Page 45866]]
Table 1c.--Adjusted Operating Standardized Amounts for Puerto Rico, Labor/Nonlabor
----------------------------------------------------------------------------------------------------------------
Large urban areas Other areas
---------------------------------------------------------------
Nonlabor-- Nonlabor--
Labor- related related Labor- related related
----------------------------------------------------------------------------------------------------------------
National........................................ $2,714.63 $1,087.37 $2,714.63 $1,087.37
Puerto Rico..................................... 2,444.77 509.50 2,406.07 501.43
----------------------------------------------------------------------------------------------------------------
Table 1d.--Capital Standard Federal Payment Rate
------------------------------------------------------------------------
Rate
------------------------------------------------------------------------
National.................................................... $461.96
Puerto Rico................................................. 355.35
------------------------------------------------------------------------
[[Page 45867]]
Table 3c.--Hospital Case Mix Indexes for Discharges Occurring in Federal Fiscal Year 1994, Hospital Average Hourly Wage for Federal Fiscal Year 1996 Wage Index
Page 1 of 16
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Avg. Avg. Avg. Avg. Avg.
Provider Case mix hour Provider Case mix hour Provider Case mix hour Provider Case mix hour Provider Case mix hour
index wage index wage index wage index wage index wage
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
010001............ 01.3968 14.70 010095............ 01.0332 10.66 030004............ 01.0179 13.13 040003............ 01.0705 13.33 040105............ 01.0662 11.86
010004............ 01.0413 11.54 010097............ 00.9261 12.23 030006............ 01.5839 17.32 040004............ 01.4025 13.86 040106............ 01.2166 11.16
010005............ 01.1775 13.61 010098............ 01.0799 11.19 030007............ 01.2521 16.55 040005............ 00.9579 11.37 040107............ 01.1231 15.18
010006............ 01.3889 14.23 010099............ 01.0329 14.74 030008............ 01.9610 20.06 040007............ 01.7232 16.81 040109............ 01.0766 12.13
010007............ 01.0911 12.03 010100............ 01.1814 13.72 030009............ 01.2256 15.42 040008............ 01.1067 10.45 040114............ 01.8042 16.23
010008............ 01.0538 09.78 010101............ 01.1089 12.72 030010............ 01.4044 17.40 040010............ 01.1910 13.08 040116............ 01.3377 18.71
010009............ 01.0803 15.47 010102............ 00.9127 11.42 030011............ 01.4903 20.19 040011............ 00.9909 10.41 040118............ 01.1197 13.58
010010............ 01.0761 13.64 010103............ 01.7143 16.47 030012............ 01.2311 15.06 040013............ 00.8034 11.75 040119............ 01.1364 13.45
010011............ 01.5164 19.89 010104............ 01.6688 16.63 030013............ 01.2419 19.04 040014............ 01.2134 15.72 040124............ 01.1769 13.61
010012............ 01.2603 14.67 010108............ 01.2172 11.76 030014............ 01.4902 17.79 040015............ 01.2060 11.77 040126............ 00.9480 11.00
010015............ 01.0453 15.13 010109............ 01.0546 11.54 030016............ 01.3304 16.82 040016............ 01.7332 15.81 040132............ 00.3512 14.00
010016............ 01.1906 15.10 010110............ 00.9496 12.21 030017............ 01.3986 18.43 040017............ 01.2172 10.52 050002............ 01.5615 26.17
010018............ 00.9544 15.60 010112............ 01.0969 13.96 030018............ 01.7243 17.74 040018............ 01.2122 15.74 050006............ 01.4001 19.22
010019............ 01.2751 13.87 010113............ 01.6285 13.09 030019............ 01.2442 18.78 040019............ 01.1123 11.20 050007............ 01.5879 26.63
010021............ 01.2588 13.21 010114............ 01.3117 15.41 030022............ 01.4806 17.27 040020............ 01.5105 13.74 050008............ 01.4323 24.86
010022............ 01.0256 15.65 010115............ 00.8513 10.12 030023............ 01.2911 16.24 040021............ 01.2130 15.42 050009............ 01.6649 26.93
010023............ 01.3805 14.44 010117............ 00.9347 18.73 030024............ 01.7625 18.77 040022............ 01.8066 14.21 050013............ 01.8480 20.87
010024............ 01.3726 15.01 010118............ 01.2246 15.42 030025............ 01.1006 13.38 040024............ 01.0180 11.62 050014............ 01.1446 22.82
010025............ 01.3813 12.75 010119............ 01.2015 15.12 030027............ 01.1208 14.29 040025............ 00.9354 10.69 050015............ 01.4331 20.74
010027............ 00.8467 13.11 010120............ 00.9965 14.36 030030............ 01.6996 20.88 040026............ 01.5494 15.05 050016............ 01.1496 14.51
010029............ 01.4704 14.06 010121............ 01.1896 14.23 030033............ 01.2155 15.50 040027............ 01.2685 12.06 050017............ 02.0952 24.17
010031............ 01.2567 13.51 010123............ 01.2321 16.17 030034............ 01.1710 15.72 040028............ 01.0217 10.19 050018............ 01.2508 18.71
010032............ 00.9701 13.69 010124............ 01.2794 15.36 030035............ 01.3011 19.44 040029............ 01.2031 13.07 050021............ 01.3600 21.85
010033............ 01.8757 17.51 010125............ 01.0446 12.25 030036............ 01.1317 17.49 040030............ 00.8998 11.86 050022............ 01.5018 22.19
010034............ 01.0149 12.69 010126............ 01.1157 12.54 030037............ 01.9258 19.15 040032............ 01.0062 10.37 050024............ 01.3482 23.48
010035............ 01.2169 14.72 010127............ 01.4863 16.01 030038............ 01.5022 17.78 040035............ 00.9926 09.69 050025............ 01.7235 21.46
010036............ 01.1364 15.26 010128............ 01.0313 10.97 030040............ 00.9810 15.24 040036............ 01.4043 15.86 050026............ 01.4341 20.43
010038............ 01.2308 16.94 010129............ 01.0641 13.39 030041............ 00.9523 16.41 040037............ 01.1119 11.56 050028............ 01.4066 15.18
010039............ 01.6205 15.05 010130............ 01.0484 15.47 030043............ 01.1729 17.72 040039............ 01.2264 11.89 050029............ 01.2872 25.93
010040............ 01.4682 17.28 010131............ 01.2518 17.42 030044............ 00.9940 13.57 040040............ 01.1993 17.12 050030............ 01.2790 19.28
010043............ 01.0564 12.55 010134............ 00.8447 12.38 030046............ 01.0471 16.87 040041............ 01.3374 14.18 050032............ 01.2640 22.74
010044............ 00.9582 12.54 010137............ 01.2210 15.71 030047............ 00.9475 18.93 040042............ 01.2984 12.26 050033............ 01.3994 24.02
010045............ 01.1387 11.95 010138............ 00.9878 09.88 030049............ 00.9609 14.29 040044............ 00.8731 10.10 050036............ 01.7580 20.22
010046............ 01.4552 13.93 010139............ 01.6156 20.00 030054............ 00.9290 12.19 040045............ 01.0710 13.23 050038............ 01.3353 28.61
010047............ 01.0735 08.72 010143............ 01.1710 16.12 030055............ 01.2152 16.00 040047............ 01.0339 14.05 050039............ 01.5925 20.33
010049............ 01.1096 14.18 010144............ 01.3054 15.54 030059............ 01.3347 20.15 040048............ 01.1791 13.54 050040............ 01.2773 22.38
010050............ 01.0179 11.94 010145............ 01.2130 15.36 030060............ 01.1092 13.06 040050............ 01.1429 11.01 050041............ 01.3654 21.68
010051............ 00.8267 09.81 010146............ 01.1608 15.74 030061............ 01.5941 16.25 040051............ 01.1125 10.19 050042............ 01.2517 20.06
010052............ 00.9528 11.56 010148............ 00.9487 10.54 030062............ 01.2600 14.57 040053............ 01.1313 12.40 050043............ 01.5396 27.78
010053............ 01.0421 12.58 010149............ 01.3465 15.90 030064............ 01.6330 16.62 040054............ 01.0770 11.90 050045............ 01.3028 17.13
010054............ 01.1530 15.11 010150............ 01.0127 13.86 030065............ 01.6023 18.78 040055............ 01.4478 14.04 050046............ 01.1768 24.46
010055............ 01.4397 14.98 010152............ 01.3346 15.42 030067............ 01.0531 15.23 040058............ 01.2358 13.05 050047............ 01.6769 28.05
010056............ 01.4021 17.64 010155............ 00.9590 09.48 030068............ 00.9663 13.92 040060............ 00.9532 12.70 050051............ 01.0947 17.01
010058............ 01.0147 12.39 020001............ 01.5075 25.13 030069............ 01.3595 16.55 040062............ 01.5209 14.64 050052............ 01.1447 ......
010059............ 01.0348 13.89 020002............ 01.0097 24.19 030071............ 00.9416 ....... 040063............ 01.4946 14.95 050054............ 01.1528 19.64
010061............ 00.9669 13.39 020004............ 01.1323 23.34 030072............ 00.8611 ....... 040064............ 00.9489 09.57 050055............ 01.4117 29.68
010062............ 01.0039 11.97 020005............ 00.9083 23.80 030073............ 01.0810 ....... 040066............ 01.0779 13.90 050056............ 01.3677 23.16
010064............ 01.7903 17.53 020006............ 01.1710 21.93 030074............ 00.8502 ....... 040067............ 01.1361 11.31 050057............ 01.4622 19.73
010065............ 01.3665 14.14 020007............ 00.8393 17.74 030075............ 00.8573 ....... 040069............ 01.0798 13.04 050058............ 01.4523 21.90
010066............ 00.9197 09.11 020008............ 00.9996 26.65 030076............ 00.8694 ....... 040070............ 00.9387 13.28 050060............ 01.5727 19.17
010068............ 01.2297 18.14 020009............ 00.9280 19.88 030077............ 00.8113 ....... 040071............ 01.4674 15.11 050061............ 01.3814 22.35
010069............ 01.0778 13.08 020010............ 01.0303 18.60 030078............ 01.1209 ....... 040072............ 01.1259 14.24 050063............ 01.4300 21.08
010072............ 01.2032 12.45 020011............ 01.1331 21.26 030079............ 00.7942 ....... 040074............ 01.3112 13.79 050065............ 01.6178 22.56
010073............ 00.9006 10.82 020012............ 01.2973 22.82 030080............ 01.6610 21.27 040075............ 01.0563 10.99 050066............ 01.2551 24.33
010078............ 01.1694 15.06 020013............ 00.8540 21.66 030083............ 01.3676 21.02 040076............ 01.0433 13.39 050067............ 01.4056 21.52
010079............ 01.1115 14.56 020014............ 01.2972 19.97 030084............ 00.9965 ....... 040077............ 00.8759 10.34 050068............ 01.2515 18.27
010080............ 00.9621 13.13 020017............ 01.3934 25.88 030085............ 01.4980 17.85 040078............ 01.4179 15.29 050069............ 01.5984 23.54
010081............ 01.9629 16.46 020018............ 00.9100 ....... 030086............ 01.2409 18.35 040080............ 01.0214 14.94 050070............ 01.3123 28.83
010083............ 01.0402 12.57 020019............ 00.8722 ....... 030087............ 01.5981 17.23 040081............ 00.8802 09.81 050071............ 01.3070 28.37
010084............ 01.3687 15.98 020020............ 00.8894 ....... 030088............ 01.3666 18.08 040082............ 01.2322 12.53 050072............ 01.3191 29.11
010085............ 01.2525 15.87 020021............ 00.8976 ....... 030089............ 01.4360 18.51 040084............ 01.0970 14.26 050073............ 01.2552 29.08
010086............ 00.9830 13.22 020024............ 01.0720 22.25 030092............ 01.5477 18.71 040085............ 01.2523 14.29 050074............ 01.0875 31.87
010087............ 01.7658 16.49 020025............ 01.0426 21.61 030093............ 01.3513 17.76 040088............ 01.3551 13.14 050075............ 01.3402 28.71
010089............ 01.1268 15.32 020026............ 01.2538 ....... 030094............ 01.3531 17.83 040090............ 00.9673 11.94 050076............ 01.6600 28.90
010090............ 01.5515 15.76 020027............ 00.9528 ....... 030095............ 01.1298 14.39 040091............ 01.2662 17.58 050077............ 01.5894 22.97
010091............ 00.9581 12.37 030001............ 01.3021 19.25 030097............ 01.0287 ....... 040093............ 00.9748 10.17 050078............ 01.3994 22.74
010092............ 01.3781 15.31 030002............ 01.8140 20.27 040001............ 01.1696 11.25 040095............ 00.8388 11.17 050079............ 01.5499 29.43
010094............ 01.1698 17.54 030003............ 01.7302 19.73 040002............ 01.1882 12.09 040100............ 01.1610 13.63 050080............ 01.2743 23.03
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
[[Page 45868]]
Page 2 of 16
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Avg. Avg. Avg. Avg. Avg.
Provider Case mix hour Provider Case mix hour Provider Case mix hour Provider Case mix hour Provider Case mix hour
index wage index wage index wage index wage index wage
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
050081............ 01.6679 21.10 050177............ 01.2282 18.24 050286............ 00.9265 26.63 050407............ 01.3626 26.56 050528............ 01.2336 16.76
050082............ 01.4770 21.26 050179............ 01.2418 18.28 050289............ 01.7527 25.91 050410............ 01.1100 16.16 050531............ 01.2049 19.81
050084............ 01.5885 21.52 050180............ 01.5435 30.93 050290............ 01.5196 24.38 050411............ 01.3968 27.93 050534............ 01.3893 23.99
050088............ 01.0729 21.32 050181............ 01.2989 ....... 050291............ 01.2685 24.17 050414............ 01.2954 24.04 050535............ 01.4946 22.35
050089............ 01.3265 19.83 050183............ 01.2255 19.25 050292............ 01.1333 21.25 050417............ 01.2300 18.53 050537............ 01.2230 21.28
050090............ 01.3257 20.02 050186............ 01.3277 24.64 050293............ 00.8257 19.92 050418............ 01.3467 24.11 050539............ 01.1557 22.82
050091............ 01.1739 21.63 050188............ 01.4107 25.19 050295............ 01.4056 20.72 050419............ 01.2985 18.33 050541............ 01.5428 28.93
050092............ 00.9075 16.84 050189............ 00.9558 22.45 050296............ 01.2987 23.78 050420............ 01.4723 24.85 050542............ 01.1764 15.76
050093............ 01.5560 20.79 050191............ 01.5886 21.31 050298............ 01.2369 16.65 050421............ 01.4309 24.17 050543............ 00.9034 24.18
050095............ 00.9989 29.05 050192............ 01.2153 18.66 050299............ 01.2994 22.49 050423............ 01.0348 17.53 050545............ 00.8899 21.07
050096............ 01.1224 18.14 050193............ 01.4095 23.10 050300............ 01.2676 18.73 050424............ 01.7320 24.12 050546............ 00.8228 21.43
050097............ 01.4238 16.13 050194............ 01.1999 25.22 050301............ 01.4347 21.30 050425............ 01.2512 27.91 050547............ 00.9096 22.13
050099............ 01.4808 22.03 050195............ 01.5632 29.15 050302............ 01.3531 23.57 050426............ 01.3324 22.18 050549............ 01.7694 25.56
050100............ 01.8779 22.92 050196............ 01.4143 18.09 050305............ 01.6085 28.25 050427............ 00.9421 22.53 050550............ 02.3252 21.44
050101............ 01.4198 24.98 050197............ 01.8868 27.85 050307............ 01.3897 20.66 050430............ 00.9277 15.31 050551............ 01.3390 23.83
050102............ 01.5195 21.67 050199............ 01.0425 22.19 050308............ 01.5405 28.06 050431............ 01.1250 20.82 050552............ 01.3328 20.13
050103............ 01.6052 28.01 050204............ 01.3887 22.44 050309............ 01.3839 23.19 050432............ 01.5930 23.40 050557............ 01.5817 21.45
050104............ 01.3567 21.95 050205............ 01.4014 19.74 050310............ 01.2782 20.36 050433............ 01.0404 17.20 050559............ 01.3762 22.56
050107............ 01.4065 20.13 050207............ 01.3154 20.06 050312............ 01.8592 23.07 050434............ 01.1767 17.00 050560............ 01.5959 22.35
050108............ 01.5751 22.50 050208............ 01.2787 27.22 050313............ 01.2419 20.05 050435............ 01.2922 16.47 050561............ 01.2104 28.42
050109............ 02.2189 23.93 050211............ 01.3765 25.67 050315............ 01.3025 20.58 050436............ 00.9928 15.70 050564............ 01.2887 25.38
050110............ 01.2585 20.72 050213............ 01.4588 19.75 050317............ 01.2356 19.58 050438............ 01.6084 23.36 050565............ 01.2006 21.03
050111............ 01.3024 18.52 050214............ 01.5542 22.70 050320............ 01.3287 32.07 050440............ 01.3911 18.93 050566............ 00.9865 13.94
050112............ 01.5233 22.95 050215............ 01.5360 25.76 050324............ 01.8053 23.27 050441............ 01.8493 27.68 050567............ 01.6027 21.00
050113............ 01.3013 26.77 050217............ 01.3147 17.43 050325............ 01.2332 20.65 050443............ 00.9409 14.95 050568............ 01.3231 22.17
050114............ 01.4336 25.49 050219............ 01.2947 20.45 050327............ 01.5955 21.01 050444............ 01.3535 23.83 050569............ 01.4307 21.89
050115............ 01.5153 21.57 050222............ 01.5416 25.04 050328............ 01.5394 27.69 050446............ 00.9957 17.23 050570............ 01.5835 24.67
050116............ 01.4747 22.94 050224............ 01.5576 21.12 050329............ 01.2920 15.93 050447............ 01.0895 16.92 050571............ 01.3222 26.14
050117............ 01.3259 18.74 050225............ 01.3801 20.48 050331............ 01.4400 28.29 050448............ 01.0625 18.59 050573............ 01.6210 22.10
050118............ 01.2218 23.13 050226............ 01.3631 21.59 050333............ 00.9684 17.95 050449............ 01.3118 20.99 050575............ 01.2532 23.34
050121............ 01.5400 20.07 050228............ 01.4464 28.72 050334............ 01.5816 28.97 050454............ 01.8126 26.37 050577............ 01.3920 21.47
050122............ 01.6430 23.24 050230............ 01.3603 26.71 050335............ 01.2433 20.84 050455............ 01.8486 21.11 050578............ 01.2616 24.09
050124............ 01.2701 22.93 050231............ 01.6538 22.19 050336............ 01.2893 19.40 050456............ 01.2190 21.52 050579............ 01.5452 27.06
050125............ 01.3509 24.50 050232............ 01.8167 25.50 050337............ 01.2628 26.55 050457............ 01.9322 28.03 050580............ 01.4027 22.40
050126............ 01.4205 24.72 050233............ 01.2148 23.64 050342............ 01.3993 17.43 050458............ 00.7146 23.76 050581............ 01.4171 24.32
050127............ 01.2797 22.28 050234............ 01.3556 18.84 050343............ 01.1120 16.91 050459............ 01.1585 28.15 050583............ 01.6137 21.83
050128............ 01.5377 20.73 050235............ 01.4868 23.84 050348............ 01.6361 24.26 050464............ 01.8498 22.87 050584............ 01.2738 22.37
050129............ 01.5022 21.49 050236............ 01.5367 24.67 050349............ 00.9483 13.96 050468............ 01.3417 15.80 050585............ 01.3347 22.76
050131............ 01.2906 25.95 050238............ 01.5043 19.87 050350............ 01.3833 21.49 050469............ 01.1376 17.19 050586............ 01.3449 22.75
050132............ 01.3632 19.85 050239............ 01.5179 21.99 050351............ 01.4824 27.25 050470............ 01.1109 19.37 050587............ 01.2709 20.16
050133............ 01.3704 20.11 050240............ 01.4428 23.58 050352............ 01.2933 22.36 050471............ 01.6780 23.33 050588............ 01.2785 27.21
050135............ 01.2507 26.85 050241............ 01.3170 26.52 050353............ 01.5831 20.14 050476............ 01.2475 19.26 050589............ 01.3320 24.60
050136............ 01.4215 21.96 050242............ 01.3730 26.92 050355............ 00.9653 15.90 050477............ 01.4106 27.66 050590............ 01.4053 23.13
050137............ 01.3803 29.95 050243............ 01.5537 24.82 050357............ 01.7895 22.17 050478............ 00.9938 22.01 050591............ 01.1739 20.64
050138............ 01.7766 30.59 050245............ 01.3655 21.94 050359............ 01.0386 19.35 050481............ 01.4268 25.61 050592............ 01.3816 23.45
050139............ 01.3303 29.15 050248............ 01.1103 24.57 050360............ 01.5164 31.61 050482............ 00.9597 18.35 050593............ 01.5525 25.60
050140............ 01.4148 29.23 050251............ 01.1099 16.23 050366............ 01.2747 20.46 050483............ 01.1904 26.34 050594............ 02.0551 22.74
050144............ 01.6499 22.42 050253............ 00.8763 18.00 050367............ 01.2967 26.14 050485............ 01.6004 21.94 050597............ 01.2322 21.75
050145............ 01.3454 26.85 050254............ 01.1399 22.76 050369............ 01.3062 23.37 050486............ 01.4342 23.44 050598............ 01.4335 25.33
050146............ 01.3466 ....... 050256............ 01.8935 19.43 050373............ 01.3703 23.22 050488............ 01.4138 27.49 050599............ 01.7122 22.85
050147............ 00.7123 20.96 050257............ 01.1982 17.90 050376............ 01.3429 25.07 050489............ 01.0669 23.36 050601............ 01.3033 30.28
050148............ 01.0691 17.09 050260............ 00.9782 21.22 050377............ 00.9475 16.99 050491............ 01.1810 26.44 050603............ 01.4452 22.96
050149............ 01.3651 22.42 050261............ 01.1624 17.18 050378............ 01.1675 22.91 050492............ 01.1874 20.52 050604............ 01.5474 27.40
050150............ 01.3121 21.41 050262............ 01.8406 25.72 050379............ 01.0648 18.39 050494............ 01.1616 23.56 050607............ 01.3481 19.27
050152............ 01.4075 25.02 050263............ 01.2553 26.81 050380............ 01.6428 26.54 050496............ 01.7182 29.82 050608............ 01.1805 15.26
050153............ 01.6199 29.55 050264............ 01.4300 26.35 050382............ 01.3947 23.92 050497............ 00.9065 11.78 050609............ 01.3393 30.07
050154............ 01.0949 21.63 050267............ 01.5691 24.29 050385............ 01.4407 24.00 050498............ 01.2744 21.87 050613............ 01.1025 22.87
050155............ 01.1562 19.97 050270............ 01.3246 22.68 050388............ 00.9432 14.21 050502............ 01.6692 21.87 050615............ 01.4503 21.15
050158............ 01.5592 26.71 050272............ 01.3615 19.69 050390............ 01.2350 21.04 050503............ 01.3323 22.11 050616............ 01.2735 20.76
050159............ 01.2369 21.78 050274............ 01.0960 18.11 050391............ 01.3409 19.68 050506............ 01.4708 24.09 050618............ 01.0205 16.48
050167............ 01.3568 22.09 050276............ 01.2591 28.37 050392............ 00.9821 16.53 050510............ 01.3648 28.70 050623............ 01.2040 23.19
050168............ 01.5962 23.78 050277............ 01.3622 21.80 050393............ 01.3945 22.22 050512............ 01.3749 29.35 050624............ 01.2514 26.72
050169............ 01.5252 23.32 050278............ 01.5011 21.16 050394............ 01.5281 22.04 050515............ 01.3295 28.65 050625............ 01.5858 23.29
050170............ 01.5054 21.35 050279............ 01.2210 20.42 050396............ 01.5525 21.13 050516............ 01.6481 23.36 050630............ 01.2448 21.58
050172............ 01.3087 20.41 050280............ 01.6345 22.36 050397............ 01.0703 17.88 050517............ 01.2673 19.52 050633............ 01.2660 21.41
050173............ 01.2190 22.01 050281............ 01.4865 ....... 050401............ 01.2008 15.64 050522............ 01.3936 29.90 050635............ 01.3393 29.56
050174............ 01.7090 25.94 050282............ 01.3481 22.82 050404............ 01.1331 13.84 050523............ 01.2175 25.91 050636............ 01.3336 21.81
050175............ 01.3262 23.42 050283............ 01.3344 26.60 050406............ 01.1195 14.65 050526............ 01.3612 25.43 050637............ 01.0646 22.10
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Avg. Avg. Avg. Avg. Avg.
Provider Case mix hour Provider Case mix hour Provider Case mix hour Provider Case mix hour Provider Case mix hour
index wage index wage index wage index wage index wage
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
050638............ 00.9513 24.17 060033............ 01.1476 11.24 070030............ 01.2535 23.06 100055............ 01.3743 17.82 100146............ 01.1447 14.10
050641............ 01.2117 15.92 060034............ 01.4987 19.01 070031............ 01.3049 19.23 100056............ 01.4899 20.15 100147............ 01.0930 13.00
050643............ 00.8711 ....... 060036............ 01.1813 12.48 070033............ 01.3033 24.24 100057............ 01.3746 15.39 100150............ 01.2948 16.60
050644............ 00.9872 24.48 060037............ 01.0516 12.26 070034............ 01.3458 24.14 100059............ 00.9153 16.60 100151............ 01.7793 18.68
050660............ 01.2866 ....... 060038............ 01.0530 11.85 070035............ 01.3917 22.12 100060............ 01.7354 16.88 100154............ 01.6427 18.00
050661............ 00.9135 20.77 060041............ 00.8964 15.38 070036............ 01.3278 25.69 100061............ 01.5117 20.28 100156............ 01.1459 17.50
050662............ 00.8619 21.30 060042............ 00.9425 17.68 070038............ 00.9919 ....... 100062............ 01.7513 16.20 100157............ 01.6054 18.71
050663............ 01.1139 22.11 060043............ 00.9975 14.76 080001............ 01.6573 23.28 100063............ 01.2214 15.65 100159............ 01.0322 14.28
050666............ 00.7638 23.70 060044............ 01.1525 14.89 080002............ 01.2698 16.99 100067............ 01.3722 15.72 100160............ 01.0625 17.34
050667............ 01.1809 23.89 060046............ 01.1237 15.46 080003............ 01.3084 19.43 100068............ 01.4318 17.17 100161............ 01.5648 19.20
050668............ 01.2274 26.93 060047............ 01.1030 09.96 080004............ 01.3271 16.96 100069............ 01.5169 15.21 100162............ 01.4159 16.74
050671............ 01.6203 27.00 060049............ 01.2107 17.19 080005............ 01.3183 15.82 100070............ 01.4353 17.16 100165............ 01.2363 13.51
050672............ 00.6349 21.17 060050............ 01.2676 13.15 080006............ 01.3653 16.48 100071............ 01.2737 15.51 100166............ 01.4690 19.88
050674............ 01.2495 28.26 060052............ 01.1344 12.88 080007............ 01.2784 17.63 100072............ 01.2463 16.34 100167............ 01.4139 20.48
050675............ 01.7051 15.00 060053............ 00.9301 12.60 090001............ 01.4960 19.94 100073............ 01.7678 20.14 100168............ 01.3765 18.12
050676............ 00.9870 13.25 060054............ 01.3476 15.54 090002............ 01.1416 15.96 100074............ 01.2361 19.00 100169............ 01.8741 18.22
050677............ 01.3405 31.12 060056............ 00.8988 12.65 090003............ 01.3455 21.55 100075............ 01.6388 16.40 100170............ 01.4112 15.90
050678............ 01.1794 24.63 060057............ 01.0220 20.40 090004............ 01.6239 22.47 100076............ 01.4024 16.43 100172............ 01.3624 13.54
050680............ 01.2553 25.39 060058............ 00.8994 10.18 090005............ 01.2725 25.88 100077............ 01.3380 15.83 100173............ 01.5814 15.59
050682............ 00.9270 13.61 060060............ 00.9656 12.38 090006............ 01.3232 19.62 100078............ 01.1723 14.56 100174............ 01.4758 18.74
050684............ 01.1759 21.43 060062............ 00.9881 14.10 090007............ 01.4799 19.96 100079............ 01.4619 18.80 100175............ 01.1062 15.14
050685............ 01.2662 27.06 060063............ 01.0031 11.07 090008............ 01.5653 19.96 100080............ 01.5393 18.32 100176............ 01.9867 25.81
050686............ 01.3631 29.52 060064............ 01.3900 20.49 090010............ 00.9357 20.65 100081............ 01.1737 12.91 100177............ 01.3286 17.48
050688............ 01.2056 28.71 060065............ 01.3782 17.83 090011............ 01.9895 24.31 100082............ 01.5720 16.76 100179............ 01.6306 17.87
050689............ 01.4343 28.59 060066............ 00.9691 12.11 100001............ 01.5587 17.27 100083............ 01.3813 16.09 100180............ 01.4820 16.54
050690............ 01.3986 28.26 060068............ 01.1369 14.76 100002............ 01.4599 18.36 100084............ 01.5159 16.83 100181............ 01.4152 15.91
050693............ 01.5106 27.22 060070............ 01.1233 15.55 100004............ 01.0642 11.43 100085............ 01.3516 19.23 100183............ 01.3405 17.45
050694............ 01.4369 21.73 060071............ 01.2613 13.96 100005............ 01.0143 17.36 100086............ 01.3887 20.43 100186............ 01.3865 14.90
050695............ 01.1047 24.12 060072............ 00.9310 ....... 100006............ 01.6473 18.18 100087............ 01.7370 19.99 100187............ 01.4505 19.93
050696............ 02.1885 26.95 060073............ 01.0637 14.30 100007............ 01.8060 18.70 100088............ 01.7194 16.94 100189............ 01.2663 21.83
050697............ 01.1355 16.30 060075............ 01.2280 18.89 100008............ 01.7161 19.32 100090............ 01.3598 15.22 100191............ 01.3230 18.97
050698............ 01.4891 21.28 060076............ 01.3825 16.07 100009............ 01.5540 19.83 100092............ 01.5115 16.62 100199............ 01.2982 18.97
050699............ 00.7489 25.39 060085............ 00.9265 10.79 100010............ 01.4427 19.21 100093............ 01.4388 14.09 100200............ 01.3820 21.22
050700............ 01.5233 30.13 060087............ 01.6314 20.20 100012............ 01.6373 17.94 100098............ 01.1755 16.49 100203............ 01.1492 18.76
050701............ 01.3466 27.27 060088............ 00.9716 13.54 100014............ 01.2434 17.55 100099............ 01.2245 15.33 100204............ 01.5986 17.77
050702............ 00.9229 16.26 060090............ 00.9339 14.20 100015............ 01.3079 16.81 100102............ 01.0695 15.80 100206............ 01.3467 20.26
050704............ 01.1765 ....... 060096............ 00.9593 19.72 100017............ 01.5767 16.31 100103............ 01.1072 15.50 100207............ 01.4218 23.04
050705............ 00.6755 ....... 060100............ 01.3764 20.85 100018............ 01.3236 18.69 100105............ 01.4167 17.66 100208............ 01.5597 21.28
050706............ 00.8631 ....... 060103............ 01.2065 20.37 100019............ 01.5037 18.79 100106............ 01.0533 14.76 100209............ 01.6023 22.01
050707............ 00.8651 ....... 060104............ 01.3098 19.86 100020............ 01.3154 19.55 100107............ 01.3184 17.58 100210............ 01.7086 15.89
050708............ 00.9092 ....... 060106............ 01.3945 ....... 100022............ 01.6583 22.47 100108............ 01.1084 15.65 100211............ 01.3203 17.57
050709............ 01.2686 ....... 070001............ 01.7362 23.62 100023............ 01.3773 15.61 100109............ 01.3226 16.41 100212............ 01.6271 18.04
060001............ 01.5030 17.31 070002............ 01.8127 24.21 100024............ 01.4214 18.53 100110............ 01.4002 16.69 100213............ 01.5981 17.94
060003............ 01.3096 16.54 070003............ 01.1701 24.23 100025............ 01.6538 15.42 100112............ 01.0009 11.56 100217............ 01.2339 18.31
060004............ 01.1473 18.71 070004............ 01.1546 23.01 100026............ 01.6173 15.46 100113............ 02.1328 16.92 100220............ 01.8434 19.78
060006............ 01.1401 16.47 070005............ 01.3231 24.75 100027............ 00.9427 10.01 100114............ 01.4707 17.68 100221............ 01.4373 18.35
060007............ 01.2317 12.87 070006............ 01.3732 25.94 100028............ 01.3008 16.01 100117............ 01.3068 17.02 100222............ 01.3493 16.57
060008............ 00.9879 13.68 070007............ 01.3763 22.95 100029............ 01.3803 18.94 100118............ 01.3114 16.43 100223............ 01.4700 16.34
060009............ 01.4330 19.83 070008............ 01.2804 22.85 100030............ 01.3109 17.44 100121............ 01.2688 14.78 100224............ 01.4555 18.76
060010............ 01.5768 21.01 070009............ 01.2496 23.96 100032............ 01.9713 17.17 100122............ 01.3418 15.71 100225............ 01.3723 19.52
060011............ 01.2375 18.74 070010............ 01.4502 22.35 100034............ 01.7876 17.67 100124............ 01.4069 18.25 100226............ 01.3627 17.20
060012............ 01.4260 16.50 070011............ 01.2736 22.16 100035............ 01.6278 16.30 100125............ 01.0866 16.78 100227............ 01.0034 17.78
060013............ 01.2804 17.06 070012............ 01.1874 22.30 100038............ 01.6744 20.22 100126............ 01.4434 18.61 100228............ 01.2587 18.85
060014............ 01.7292 20.66 070013............ 01.3474 23.92 100039............ 01.7057 20.59 100127............ 01.5845 18.03 100229............ 01.3333 17.11
060015............ 01.6044 18.45 070015............ 01.3807 23.42 100040............ 01.6897 16.11 100128............ 02.1609 19.42 100230............ 01.3649 18.43
060016............ 01.1611 12.48 070016............ 01.3213 24.30 100042............ 01.6015 20.23 100129............ 01.3096 17.71 100231............ 01.6877 17.03
060018............ 01.2240 14.91 070017............ 01.4158 23.47 100043............ 01.4283 19.94 100130............ 01.1928 17.18 100232............ 01.2221 17.96
060020............ 01.4952 15.53 070018............ 01.4256 25.83 100044............ 01.4447 19.01 100131............ 01.3138 19.27 100234............ 01.6152 18.45
060022............ 01.7419 16.71 070019............ 01.2680 23.06 100045............ 01.4428 16.70 100132............ 01.4097 15.18 100235............ 01.4317 16.20
060023............ 01.5247 17.84 070020............ 01.4289 23.68 100046............ 01.5106 16.91 100134............ 01.2156 14.50 100236............ 01.4542 17.71
060024............ 01.7207 21.41 070021............ 01.2994 25.55 100047............ 01.7854 20.80 100135............ 01.4709 15.53 100237............ 02.1813 22.74
060026............ 01.4299 18.52 070022............ 01.6980 24.10 100048............ 00.9565 11.55 100137............ 01.2745 16.08 100238............ 01.4226 16.85
060027............ 01.5313 19.14 070024............ 01.3199 21.90 100049............ 01.3153 16.74 100138............ 00.9682 11.92 100239............ 01.4527 18.66
060028............ 01.4606 20.00 070025............ 01.6953 23.66 100050............ 01.2729 15.06 100139............ 01.0334 15.70 100240............ 00.8556 14.86
060029............ 01.0333 14.09 070026............ 01.1185 23.44 100051............ 01.2310 16.21 100140............ 01.1773 16.00 100241............ 00.9113 12.29
060030............ 01.3159 18.40 070027............ 01.2450 24.05 100052............ 01.4041 14.82 100142............ 01.1827 16.26 100242............ 01.4018 15.55
060031............ 01.5071 18.31 070028............ 01.4651 22.94 100053............ 01.3238 16.23 100144............ 01.2243 11.94 100243............ 01.4662 16.92
060032............ 01.4381 20.01 070029............ 01.2874 20.71 100054............ 01.2994 17.88 100145............ 01.4725 12.24 100244............ 01.3863 17.40
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[[Page 45870]]
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Avg. Avg. Avg. Avg. Avg.
Provider Case mix hour Provider Case mix hour Provider Case mix hour Provider Case mix hour Provider Case mix hour
index wage index wage index wage index wage index wage
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
100246............ 01.3230 20.75 110042............ 01.1790 14.31 110134............ 00.8704 10.30 120015............ 00.8598 20.16 140026............ 01.1449 14.78
100248............ 01.6328 18.68 110043............ 01.6250 15.19 110135............ 01.1388 12.78 120016............ 00.8970 20.47 140027............ 01.2762 15.39
100249............ 01.3119 18.19 110044............ 01.1797 13.21 110136............ 01.1520 17.56 120018............ 00.9883 19.81 140029............ 01.2988 18.41
100252............ 01.1810 18.33 110045............ 01.2493 21.95 110140............ 00.8058 16.43 120019............ 01.1558 18.50 140030............ 01.5387 20.92
100253............ 01.3866 18.25 110046............ 01.1838 15.37 110141............ 00.8796 10.46 120021............ 00.9286 20.79 140031............ 01.1847 12.51
100254............ 01.5036 16.89 110048............ 01.2613 13.55 110142............ 01.0386 11.73 120022............ 01.6897 16.62 140032............ 01.2774 15.20
100255............ 01.2985 20.20 110049............ 01.0212 14.46 110143............ 01.3255 18.71 120025............ 00.9278 18.26 140033............ 01.2441 17.93
100256............ 01.8114 19.59 110050............ 01.0553 12.45 110144............ 01.1549 12.85 120026............ 01.2765 21.37 140034............ 01.1618 15.80
100258............ 01.6527 21.05 110051............ 00.9820 16.34 110146............ 00.9561 12.45 120027............ 01.4535 20.92 140035............ 01.0554 11.09
100259............ 01.4100 16.77 110052............ 00.8726 14.34 110149............ 01.0717 11.53 130001............ 00.9695 15.35 140036............ 01.1506 14.74
100260............ 01.4001 19.49 110054............ 01.2733 16.58 110150............ 01.3285 15.62 130002............ 01.3383 14.89 140037............ 00.9955 11.93
100262............ 01.4017 18.35 110056............ 01.0644 11.70 110152............ 01.1220 12.64 130003............ 01.2345 17.34 140038............ 01.1754 15.57
100263............ 01.4215 16.60 110059............ 01.2402 13.14 110153............ 00.9568 16.74 130005............ 01.4022 17.25 140039............ 00.9621 12.57
100264............ 01.3949 16.86 110061............ 01.0319 10.55 110154............ 00.9795 13.79 130006............ 01.8193 16.88 140040............ 01.2404 13.67
100265............ 01.2985 17.52 110062............ 00.9472 10.27 110155............ 01.1836 14.04 130007............ 01.5553 17.89 140041............ 01.1593 15.42
100266............ 01.2182 15.99 110063............ 01.0362 11.52 110156............ 00.9738 12.03 130008............ 00.9091 11.92 140042............ 01.0276 13.28
100267............ 01.2953 19.12 110064............ 01.2695 15.88 110157............ 01.0805 15.98 130009............ 00.9481 15.96 140043............ 01.2443 15.96
100268............ 01.2190 22.57 110065............ 01.0563 11.99 110161............ 01.2316 19.75 130010............ 01.0134 14.43 140045............ 00.9734 12.36
100269............ 01.3820 21.84 110066............ 01.3146 15.99 110162............ 00.8777 ....... 130011............ 01.2663 15.29 140046............ 01.2920 15.06
100270............ 00.8854 08.60 110069............ 01.1375 16.05 110163............ 01.3592 18.05 130012............ 01.0033 17.91 140047............ 01.1556 12.83
100271............ 01.7876 16.19 110070............ 00.9918 10.92 110164............ 01.4399 18.67 130013............ 01.2907 16.78 140048............ 01.3210 21.62
100273............ 01.1555 16.72 110071............ 00.9799 09.13 110165............ 01.3380 16.78 130014............ 01.3583 16.02 140049............ 01.5612 18.55
100275............ 01.5128 21.10 110072............ 01.0385 11.97 110166............ 01.5044 16.62 130015............ 00.8456 11.94 140051............ 01.4159 19.71
100276............ 01.3266 21.04 110073............ 01.2536 12.73 110168............ 01.6390 19.01 130016............ 00.8863 16.82 140052............ 01.3254 15.64
100277............ 01.0704 13.45 110074............ 01.4550 17.30 110169............ 00.6684 19.82 130017............ 01.1662 14.08 140053............ 01.8281 17.25
100278............ 00.8470 17.64 110075............ 01.1944 14.67 110171............ 01.3974 21.21 130018............ 01.6857 18.13 140054............ 01.3179 22.79
100279............ 01.4017 19.25 110076............ 01.3738 18.20 110172............ 01.2170 ....... 130019............ 01.1462 13.98 140055............ 00.9762 13.01
100280............ 01.4128 17.83 110078............ 01.6419 20.48 110174............ 00.9987 13.50 130021............ 00.9430 10.36 140058............ 01.1683 14.76
100281............ 01.2713 19.04 110079............ 01.3867 19.71 110176............ 01.0961 19.01 130022............ 01.2896 15.71 140059............ 01.1460 13.34
100282............ 01.1035 ....... 110080............ 01.1510 15.47 110177............ 01.4732 18.73 130024............ 01.0074 15.03 140061............ 01.0905 13.15
100283............ 01.4423 ....... 110082............ 02.0423 20.22 110178............ 01.0701 19.58 130025............ 01.1165 16.20 140062............ 01.2773 21.56
110001............ 01.2829 16.74 110083............ 01.6304 20.25 110179............ 01.2084 21.20 130026............ 01.1560 16.79 140063............ 01.3587 20.34
110002............ 01.2029 14.85 110086............ 01.1579 13.70 110181............ 00.9605 11.66 130027............ 00.8922 16.96 140064............ 01.2366 15.63
110003............ 01.3085 12.29 110087............ 01.2659 18.36 110183............ 01.4004 18.69 130028............ 01.2052 15.05 140065............ 01.4654 23.04
110004............ 01.2453 16.00 110088............ 01.0863 10.58 110184............ 01.1402 17.71 130029............ 01.0312 15.58 140066............ 01.2979 13.08
110005............ 01.2307 17.68 110089............ 01.1961 14.54 110185............ 01.1390 12.05 130030............ 01.0209 14.67 140067............ 01.8106 17.15
110006............ 01.3275 17.10 110091............ 01.3517 17.32 110186............ 01.2511 15.58 130031............ 01.0486 11.89 140068............ 01.3772 17.79
110007............ 01.4301 15.73 110092............ 01.0992 12.26 110187............ 01.1357 17.43 130034............ 01.0508 14.58 140069............ 01.0914 14.27
110008............ 01.1769 14.50 110093............ 00.9452 09.30 110188............ 01.4760 17.46 130035............ 00.9454 13.51 140070............ 01.3464 15.36
110009............ 01.0443 15.28 110094............ 01.0216 11.93 110189............ 01.2039 18.59 130036............ 01.2470 09.19 140074............ 01.0354 15.11
110010............ 02.0526 23.06 110095............ 01.2630 12.81 110190............ 01.1387 13.01 130037............ 01.1733 15.01 140075............ 01.4482 17.74
110011............ 01.2551 15.54 110096............ 01.0913 12.34 110191............ 01.3062 17.97 130043............ 01.0364 14.00 140077............ 01.1222 14.95
110013............ 01.1134 13.82 110097............ 01.0512 14.03 110192............ 01.3434 20.20 130044............ 01.0674 10.65 140079............ 01.2611 20.63
110014............ 01.0738 13.26 110098............ 01.0322 12.30 110193............ 01.1627 15.60 130045............ 01.0030 12.30 140080............ 01.6786 18.56
110015............ 01.2788 16.72 110100............ 01.0601 11.30 110194............ 00.9472 12.58 130048............ 01.0330 10.31 140081............ 01.1023 12.45
110016............ 01.2194 14.43 110101............ 01.0740 10.28 110195............ 01.1321 10.00 130049............ 01.2151 16.73 140082............ 01.5490 20.34
110017............ 00.9514 11.20 110103............ 00.9390 09.39 110198............ 01.3765 22.76 130054............ 00.9330 18.69 140083............ 01.2899 15.67
110018............ 01.1881 15.66 110104............ 01.1922 12.01 110200............ 01.9396 15.32 130056............ 00.9020 09.97 140084............ 01.2165 18.03
110020............ 01.2051 17.27 110105............ 01.0766 14.09 110201............ 01.3759 16.18 130058............ 01.0275 13.32 140086............ 01.1518 11.92
110023............ 01.2964 16.89 110107............ 01.7532 17.13 110203............ 00.9931 15.24 130060............ 01.2292 17.97 140087............ 01.2902 17.36
110024............ 01.4085 16.46 110108............ 01.0779 10.44 110204............ 00.7983 16.64 140001............ 01.2446 14.00 140088............ 01.5977 23.06
110025............ 01.4202 15.36 110109............ 01.1110 13.54 110205............ 01.0713 13.28 140002............ 01.3090 16.16 140089............ 01.2351 15.16
110026............ 01.1955 13.12 110111............ 01.1008 13.66 110207............ 01.0576 13.48 140003............ 01.0231 12.69 140090............ 01.4626 24.80
110027............ 01.0801 14.33 110112............ 00.9810 15.61 110208............ 00.9109 12.52 140004............ 01.0152 14.64 140091............ 01.7797 16.35
110028............ 01.6087 17.60 110113............ 01.0754 12.69 110209............ 00.9130 ....... 140005............ 00.9445 09.86 140093............ 01.1615 15.98
110029............ 01.3243 17.70 110114............ 01.1082 13.17 110210............ 01.0869 ....... 140007............ 01.4546 20.34 140094............ 01.2618 17.89
110030............ 01.2231 17.52 110115............ 01.6517 18.21 120001............ 01.7122 23.07 140008............ 01.4279 20.25 140095............ 01.5124 18.79
110031............ 01.3455 20.47 110118............ 01.0138 11.40 120002............ 01.2031 17.55 140010............ 01.3181 21.78 140097............ 00.9517 12.93
110032............ 01.2138 14.40 110120............ 01.1050 11.39 120003............ 01.1117 21.38 140011............ 01.0968 13.89 140098............ 01.6019 18.91
110033............ 01.4241 20.02 110121............ 01.1562 12.05 120004............ 01.2411 19.86 140012............ 01.2725 15.85 140100............ 01.3360 17.74
110034............ 01.5155 15.82 110122............ 01.2984 15.88 120005............ 01.2737 18.43 140013............ 01.6368 15.47 140101............ 01.1394 17.56
110035............ 01.3200 18.11 110124............ 01.0454 14.58 120006............ 01.1713 22.51 140014............ 01.1626 15.87 140102............ 01.0394 13.57
110036............ 01.6154 18.45 110125............ 01.2007 15.34 120007............ 01.6238 19.33 140015............ 01.2858 13.12 140103............ 01.3496 17.19
110037............ 01.0626 09.72 110127............ 00.9893 12.30 120009............ 01.0106 18.94 140016............ 00.9209 10.97 140105............ 01.2716 19.12
110038............ 01.4567 14.12 110128............ 01.1836 17.25 120010............ 01.8065 21.30 140018............ 01.3546 18.18 140107............ 01.0636 11.30
110039............ 01.3732 17.07 110129............ 01.6398 12.75 120011............ 01.2612 28.18 140019............ 00.9450 12.11 140108............ 01.3514 20.09
110040............ 01.0515 15.13 110130............ 01.0589 09.58 120012............ 00.9554 19.45 140024............ 01.0061 13.82 140109............ 01.0897 12.38
110041............ 01.2778 13.87 110132............ 01.1404 12.55 120014............ 01.2507 20.16 140025............ 01.0811 15.57 140110............ 01.2892 15.34
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Avg. Avg. Avg. Avg. Avg.
Provider Case mix hour Provider Case mix hour Provider Case mix hour Provider Case mix hour Provider Case mix hour
index wage index wage index wage index wage index wage
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
140112............ 01.0965 13.56 140202............ 01.3426 19.33 150022............ 01.0980 17.53 150101............ 01.1104 15.07 160048............ 01.1233 11.75
140113............ 01.4687 17.23 140203............ 01.1739 17.40 150023............ 01.4769 16.92 150102............ 01.0650 13.94 160049............ 00.9284 11.56
140114............ 01.3274 17.70 140205............ 00.9214 13.44 150024............ 01.3035 15.60 150103............ 01.0279 15.64 160050............ 01.0311 13.62
140115............ 01.2848 16.57 140206............ 00.9779 18.13 150025............ 01.4971 17.14 150104............ 01.1084 14.82 160051............ 01.1187 14.21
140116............ 01.2435 17.79 140207............ 01.3688 19.80 150026............ 01.1675 16.48 150105............ 01.3107 15.63 160052............ 01.0489 12.86
140117............ 01.4090 16.72 140208............ 01.5927 22.03 150027............ 01.0157 15.66 150106............ 01.0815 15.53 160054............ 00.9694 11.05
140118............ 01.6957 21.24 140209............ 01.7149 16.20 150029............ 01.2769 17.73 150109............ 01.4210 14.54 160055............ 01.0271 12.02
140119............ 01.6578 20.94 140210............ 01.0283 11.46 150030............ 01.0675 15.26 150110............ 00.9954 14.35 160056............ 01.0362 12.73
140120............ 01.4814 14.18 140211............ 01.1928 18.69 150031............ 01.0304 13.82 150111............ 01.2159 13.31 160057............ 01.3290 14.53
140121............ 01.4762 10.01 140212............ 01.1562 21.62 150032............ 01.8129 18.37 150112............ 01.2079 16.65 160058............ 01.6641 17.91
140122............ 01.5373 20.90 140213............ 01.2707 21.23 150033............ 01.5682 18.86 150113............ 01.1647 16.07 160060............ 01.0516 13.01
140124............ 01.1333 21.99 140215............ 01.1481 13.29 150034............ 01.3594 18.13 150114............ 01.0006 12.64 160061............ 01.0052 12.04
140125............ 01.3141 14.30 140217............ 01.2000 20.19 150035............ 01.4091 17.89 150115............ 01.3358 16.31 160062............ 01.0359 11.11
140127............ 01.3094 16.12 140218............ 00.9759 13.27 150036............ 01.0182 16.72 150122............ 01.1316 16.92 160063............ 01.1735 12.72
140128............ 01.0912 15.47 140220............ 01.1237 14.02 150037............ 01.2532 16.88 150123............ 01.2559 13.21 160064............ 01.5804 16.66
140129............ 01.0377 13.55 140223............ 01.5250 21.42 150038............ 01.3406 15.77 150124............ 01.1502 14.29 160065............ 01.0796 13.11
140130............ 01.1725 19.93 140224............ 01.3763 20.01 150039............ 00.9542 14.21 150125............ 01.3991 17.70 160066............ 01.1325 13.51
140132............ 01.4217 18.36 140228............ 01.5757 16.72 150042............ 01.2377 14.39 150126............ 01.5033 18.93 160067............ 01.4111 15.81
140133............ 01.3843 19.25 140230............ 00.9812 14.89 150043............ 01.0398 18.18 150127............ 01.1534 12.34 160068............ 00.9913 13.55
140135............ 01.2412 13.86 140231............ 01.5483 19.72 150044............ 01.2436 17.15 150128............ 01.2294 17.33 160069............ 01.3977 15.53
140137............ 01.0158 13.42 140233............ 01.7552 15.55 150045............ 01.1638 15.56 150129............ 01.1748 19.71 160070............ 00.9804 13.02
140138............ 00.9707 11.80 140234............ 01.1921 15.04 150046............ 01.4977 16.06 150130............ 01.0588 13.99 160072............ 01.0797 12.24
140139............ 01.0718 13.33 140236............ 00.9891 11.86 150047............ 01.6539 17.32 150132............ 01.3503 18.09 160073............ 00.9651 10.93
140140............ 01.1676 12.45 140239............ 01.5695 17.90 150048............ 01.1741 15.68 150133............ 01.1933 15.64 160074............ 00.9967 12.64
140141............ 00.9239 12.09 140240............ 01.4712 21.75 150049............ 01.1587 12.40 150134............ 01.2884 15.24 160075............ 01.0724 13.49
140143............ 01.1190 15.80 140242............ 01.5193 20.44 150050............ 01.1485 14.30 150136............ 00.9179 18.60 160076............ 01.0566 15.24
140144............ 01.0202 13.85 140245............ 01.1141 12.96 150051............ 01.2735 15.96 150137............ 03.1313 ....... 160077............ 01.2005 10.22
140145............ 01.1235 15.06 140246............ 01.0607 11.58 150052............ 01.1241 11.23 150138............ 01.1910 ....... 160079............ 01.4063 15.08
140146............ 00.9399 14.65 140250............ 01.2721 21.19 150053............ 01.0216 15.93 150140............ 02.4842 ....... 160080............ 01.2127 15.51
140147............ 01.1689 13.02 140251............ 01.3111 17.14 150054............ 01.1266 13.30 150141............ 00.9198 ....... 160081............ 01.0831 13.91
140148............ 01.7026 16.79 140252............ 01.4481 21.67 150056............ 01.6530 19.66 150897............ 05.1218 ....... 160082............ 01.6924 16.88
140150............ 01.5334 22.42 140253............ 01.4610 14.43 150057............ 02.4338 14.55 160001............ 01.2439 16.04 160083............ 01.5064 16.82
140151............ 01.1688 16.06 140258............ 01.5165 20.74 150058............ 01.6757 17.54 160002............ 01.2061 12.61 160085............ 01.0754 11.90
140152............ 01.0932 21.14 140271............ 01.0467 13.77 150059............ 01.3249 18.15 160003............ 01.0308 12.40 160086............ 00.9602 12.15
140155............ 01.2094 16.91 140275............ 01.2155 15.26 150060............ 01.1564 15.01 160005............ 01.0538 12.42 160088............ 01.0433 13.89
140158............ 01.3335 20.44 140276............ 01.9959 19.03 150061............ 01.2447 14.90 160007............ 01.0184 12.24 160089............ 01.2073 13.54
140160............ 01.2063 14.61 140280............ 01.2762 16.62 150062............ 01.0233 14.82 160008............ 01.1335 14.26 160090............ 01.0580 14.34
140161............ 01.1250 16.18 140281............ 01.5943 19.85 150063............ 01.0873 19.83 160009............ 01.2106 13.13 160091............ 01.1695 10.55
140162............ 01.6805 17.28 140285............ 01.2309 14.65 150064............ 01.0346 16.55 160012............ 01.1292 13.88 160092............ 00.9649 12.70
140164............ 01.2497 15.27 140286............ 01.0922 16.58 150065............ 01.0989 16.08 160013............ 01.2580 14.28 160093............ 01.1424 12.92
140165............ 01.0894 12.83 140288............ 01.6787 21.28 150066............ 00.9891 13.07 160014............ 00.9703 12.72 160094............ 01.2097 14.65
140166............ 01.2670 15.81 140289............ 01.2885 14.43 150067............ 01.0729 13.96 160016............ 01.2622 15.22 160095............ 01.0123 15.81
140167............ 01.1570 13.88 140290............ 01.3203 19.56 150069............ 01.2194 16.18 160018............ 00.9108 12.92 160097............ 01.1814 13.10
140168............ 01.2012 14.64 140291............ 01.3419 22.01 150070............ 01.0530 14.00 160020............ 01.0625 11.57 160098............ 01.0188 12.41
140170............ 01.1306 11.77 140292............ 01.1778 18.63 150071............ 01.2019 11.71 160021............ 01.0819 14.23 160099............ 00.9949 11.94
140171............ 00.8944 10.42 140294............ 01.1511 15.03 150072............ 01.1576 15.53 160023............ 01.0941 13.47 160101............ 01.1236 17.13
140172............ 01.5026 17.11 140297............ 01.1950 21.49 150073............ 00.9918 17.12 160024............ 01.5923 16.25 160102............ 01.3050 15.06
140173............ 00.9836 12.88 140300............ 01.0367 ....... 150074............ 01.5594 18.05 160025............ 01.7778 15.89 160103............ 00.9911 12.23
140174............ 01.4124 17.67 150001............ 01.0972 16.90 150075............ 01.1754 13.29 160026............ 01.1442 14.15 160104............ 01.1581 16.70
140176............ 01.2493 19.10 150002............ 01.4373 17.08 150076............ 01.0745 16.60 160027............ 01.1974 12.61 160106............ 01.0904 13.40
140177............ 01.2799 15.29 150003............ 01.7331 16.59 150077............ 01.3123 15.22 160028............ 01.3029 17.45 160107............ 01.1461 14.31
140179............ 01.3034 18.61 150004............ 01.4468 18.37 150078............ 01.0196 18.19 160029............ 01.4799 16.57 160108............ 01.1020 13.59
140180............ 01.4730 20.05 150005............ 01.2178 16.87 150079............ 01.2034 13.37 160030............ 01.2650 15.65 160109............ 00.9338 11.85
140181............ 01.3412 17.28 150006............ 01.1904 15.77 150082............ 01.4896 16.98 160031............ 01.1968 12.60 160110............ 01.5430 17.18
140182............ 01.3058 19.45 150007............ 01.2625 17.48 150084............ 01.8655 21.52 160032............ 01.1969 14.22 160111............ 00.9992 10.53
140184............ 01.1675 13.87 150008............ 01.3341 18.07 150086............ 01.2770 15.03 160033............ 01.5017 15.45 160112............ 01.4460 14.36
140185............ 01.4725 15.34 150009............ 01.2833 16.85 150088............ 01.1849 16.25 160034............ 01.0027 13.04 160113............ 01.0071 11.13
140186............ 01.2813 17.46 150010............ 01.1806 16.38 150089............ 01.3686 17.27 160035............ 00.9960 11.50 160114............ 01.0526 13.89
140187............ 01.4143 15.70 150011............ 01.2160 15.65 150090............ 01.2297 17.84 160036............ 01.0488 13.58 160115............ 00.9897 12.83
140188............ 00.9687 10.93 150012............ 01.6434 18.77 150091............ 01.0696 15.33 160037............ 01.1651 14.19 160116............ 01.1879 14.80
140189............ 01.1508 15.87 150013............ 01.1117 12.68 150092............ 01.0246 12.84 160039............ 01.0370 14.71 160117............ 01.2924 14.70
140190............ 01.1530 13.53 150014............ 01.4271 18.85 150094............ 01.0291 16.14 160040............ 01.3268 15.44 160118............ 01.0051 11.77
140191............ 01.4154 20.56 150015............ 01.2677 16.77 150095............ 01.0866 15.17 160041............ 01.0084 12.61 160120............ 00.9931 09.44
140192............ 01.1322 16.11 150017............ 01.7977 15.68 150096............ 01.0528 17.76 160043............ 01.0207 13.56 160122............ 01.1748 14.31
140193............ 01.0104 11.79 150018............ 01.2591 16.65 150097............ 01.0892 16.38 160044............ 01.1698 12.51 160123............ 01.1808 14.15
140197............ 01.3690 16.76 150019............ 01.0382 13.59 150098............ 01.1575 11.86 160045............ 01.6667 16.35 160124............ 01.2394 14.80
140199............ 01.0260 14.73 150020............ 01.1643 12.34 150099............ 01.2997 16.16 160046............ 01.0636 11.86 160126............ 01.0838 16.15
140200............ 01.4494 20.10 150021............ 01.6412 17.52 150100............ 01.6382 17.23 160047............ 01.3421 15.29 160129............ 01.0127 12.82
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[[Page 45872]]
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Avg. Avg. Avg. Avg. Avg.
Provider Case mix hour Provider Case mix hour Provider Case mix hour Provider Case mix hour Provider Case mix hour
index wage index wage index wage index wage index wage
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
160130............ 01.0625 12.49 170067............ 00.9103 11.65 170160............ 01.0407 11.13 180067............ 01.9277 15.27 190034............ 01.1602 14.41
160131............ 01.1371 12.28 170068............ 01.3094 14.11 170164............ 00.9906 13.92 180069............ 01.0350 15.39 190035............ 01.4469 17.61
160133............ 01.1892 17.39 170069............ 01.1645 13.12 170166............ 01.1623 13.71 180070............ 01.0759 13.59 190036............ 01.6233 18.08
160134............ 01.0327 12.24 170070............ 01.0065 12.24 170168............ 00.8805 10.83 180072............ 00.9953 14.39 190037............ 01.0251 10.21
160135............ 00.9953 10.69 170072............ 00.9187 10.54 170171............ 01.0870 10.44 180075............ 00.9673 12.29 190039............ 01.4452 17.58
160138............ 01.1205 12.71 170073............ 01.0171 12.99 170172............ 00.9598 12.70 180078............ 01.0960 16.85 190040............ 01.3872 17.91
160140............ 01.0812 14.30 170074............ 01.1095 12.85 170174............ 01.0175 10.87 180079............ 01.2252 13.16 190041............ 01.4886 16.84
160142............ 01.0411 13.08 170075............ 00.8614 10.41 170175............ 01.2756 17.46 180080............ 01.0560 13.90 190043............ 01.0919 12.42
160143............ 01.0401 12.58 170076............ 01.0513 10.87 170176............ 01.5076 19.27 180085............ 01.2867 16.89 190044............ 01.1587 17.86
160145............ 01.1178 11.55 170077............ 00.9750 10.85 170181............ 01.1767 ....... 180087............ 01.0977 13.07 190045............ 01.3452 18.67
160146............ 01.3788 14.96 170079............ 01.0894 10.45 180001............ 01.2221 15.86 180088............ 01.6293 18.09 190046............ 01.4675 16.26
160147............ 01.2215 14.07 170080............ 00.9829 11.16 180002............ 01.0469 16.25 180092............ 01.0862 13.78 190047............ 01.0592 16.48
160151............ 01.0912 13.10 170081............ 00.9978 10.32 180004............ 01.1119 13.38 180093............ 01.3382 14.08 190048............ 01.0642 13.69
160152............ 00.9447 12.41 170082............ 00.9942 10.30 180005............ 01.0618 17.26 180094............ 00.9419 11.42 190049............ 01.0172 13.95
160153............ 01.7242 16.90 170084............ 00.9622 10.65 180006............ 00.9274 08.63 180095............ 01.1899 12.50 190050............ 01.0694 13.14
170001............ 01.2131 14.88 170085............ 00.8999 11.95 180007............ 01.3845 14.33 180099............ 01.2077 10.89 190053............ 01.0354 12.25
170004............ 01.0693 12.69 170086............ 01.6679 17.55 180009............ 01.3240 16.50 180101............ 01.3186 18.68 190054............ 01.3615 13.23
170006............ 01.2010 15.19 170087............ 01.4303 18.81 180010............ 01.8396 16.23 180102............ 01.4368 14.54 190059............ 00.9426 13.39
170008............ 00.9801 12.92 170088............ 00.8977 09.76 180011............ 01.1454 15.42 180103............ 02.0493 17.52 190060............ 01.4785 15.16
170009............ 01.1155 17.18 170089............ 01.0612 12.95 180012............ 01.3085 16.85 180104............ 01.4735 15.55 190064............ 01.4974 16.92
170010............ 01.1763 14.08 170090............ 01.0082 09.95 180013............ 01.4626 15.12 180105............ 00.9012 12.43 190065............ 01.4931 17.04
170011............ 01.3537 14.19 170092............ 00.8129 11.15 180014............ 01.5910 17.73 180106............ 00.9012 11.83 190071............ 00.8498 11.85
170012............ 01.4645 15.64 170093............ 00.8838 11.10 180015............ 01.1845 14.35 180108............ 00.8747 12.16 190075............ 01.4543 18.92
170013............ 01.3540 13.97 170094............ 01.0632 13.44 180016............ 01.2633 14.75 180115............ 00.9720 14.02 190077............ 00.9541 11.73
170014............ 01.0794 14.53 170095............ 01.1095 13.17 180017............ 01.2913 13.27 180116............ 01.3169 15.01 190078............ 01.1817 11.43
170015............ 00.9806 13.60 170097............ 00.9789 10.48 180018............ 01.1740 13.63 180117............ 01.2367 15.41 190079............ 01.2300 14.73
170016............ 01.6091 19.51 170098............ 01.0225 15.18 180019............ 01.3293 16.80 180118............ 01.0391 11.92 190081............ 00.9047 08.99
170017............ 01.1922 15.10 170099............ 01.3189 10.77 180020............ 01.0556 15.49 180120............ 00.9822 12.26 190083............ 00.9672 11.08
170018............ 01.0161 11.92 170100............ 01.0247 13.48 180021............ 01.1618 12.98 180121............ 01.0719 12.71 190086............ 01.3024 14.53
170019............ 01.1399 14.63 170101............ 00.9913 13.45 180023............ 00.8798 10.99 180122............ 01.0623 12.63 190088............ 01.2370 16.36
170020............ 01.3110 14.68 170102............ 00.9680 12.36 180024............ 01.2590 15.48 180123............ 01.4446 17.30 190089............ 01.0711 09.26
170022............ 01.1413 13.47 170103............ 01.2817 14.83 180025............ 01.1179 15.19 180124............ 01.4142 15.91 190090............ 01.1668 14.43
170023............ 01.3799 15.56 170104............ 01.4279 19.34 180026............ 01.1606 11.76 180125............ 00.9599 15.97 190092............ 01.2573 12.24
170024............ 01.2165 11.95 170105............ 00.9750 13.23 180027............ 01.2141 14.17 180126............ 01.2179 11.31 190095............ 01.0284 13.52
170025............ 01.3789 14.29 170106............ 00.8751 12.19 180028............ 00.9833 16.46 180127............ 01.2600 16.63 190098............ 01.5166 17.10
170026............ 01.0526 13.40 170108............ 00.9812 10.51 180029............ 01.2220 15.43 180128............ 01.1607 13.00 190099............ 01.1300 17.03
170027............ 01.2573 14.72 170109............ 01.0068 13.96 180030............ 01.1336 09.54 180129............ 01.0456 15.03 190102............ 01.5245 15.33
170030............ 01.0235 13.67 170110............ 00.9179 15.29 180031............ 00.9296 12.11 180130............ 01.4167 17.27 190103............ 00.8384 09.39
170031............ 00.9325 11.65 170112............ 00.9238 12.74 180032............ 01.0559 15.53 180132............ 01.1821 14.40 190106............ 01.1220 15.42
170032............ 01.1074 13.49 170113............ 01.1925 13.04 180033............ 01.1073 12.13 180133............ 01.2386 17.31 190109............ 01.2162 14.04
170033............ 01.2882 14.68 170114............ 01.0133 12.48 180034............ 00.9890 14.93 180134............ 00.9786 12.39 190110............ 01.0315 11.76
170034............ 00.9131 13.26 170115............ 01.0216 10.73 180035............ 01.4971 16.92 180136............ 01.4161 16.84 190111............ 01.5568 17.17
170035............ 00.8750 12.11 170116............ 01.0387 13.57 180036............ 01.1477 16.65 180137............ 01.6839 17.08 190112............ 01.4902 17.35
170036............ 00.8821 11.44 170117............ 00.9050 12.83 180037............ 01.2434 19.20 180138............ 01.1826 16.52 190113............ 01.3396 17.08
170037............ 01.1169 15.23 170119............ 00.9649 10.20 180038............ 01.3562 14.14 180139............ 01.1051 15.33 190114............ 00.9851 12.28
170038............ 00.9551 11.29 170120............ 01.3299 14.75 180040............ 01.9301 19.09 190001............ 00.9644 16.01 190115............ 01.2542 17.60
170039............ 01.0968 12.22 170121............ 00.9411 11.71 180041............ 01.0478 13.28 190002............ 01.6374 18.16 190116............ 01.2858 13.30
170040............ 01.4401 16.25 170122............ 01.8098 18.62 180042............ 01.1672 12.00 190003............ 01.4074 18.23 190118............ 01.0092 12.00
170041............ 01.0143 11.04 170123............ 01.7901 18.27 180043............ 01.0935 15.39 190004............ 01.3544 14.02 190120............ 01.0309 13.37
170043............ 01.0640 12.94 170124............ 00.9830 12.46 180044............ 01.0544 13.83 190005............ 01.5020 15.78 190122............ 01.2919 13.38
170044............ 01.1084 14.61 170126............ 00.9847 10.58 180045............ 01.2217 16.28 190006............ 01.2258 13.74 190124............ 01.4639 18.66
170045............ 00.9976 12.44 170128............ 00.9854 13.53 180046............ 01.0915 16.36 190007............ 01.0434 12.27 190125............ 01.4620 15.18
170049............ 01.3162 17.80 170131............ 01.1350 09.38 180047............ 01.0650 13.71 190008............ 01.6475 16.82 190127............ 01.4558 19.90
170050............ 01.0199 10.54 170133............ 01.1703 14.32 180048............ 01.1869 15.40 190009............ 01.1425 13.81 190128............ 01.0642 16.60
170051............ 00.9951 12.83 170134............ 00.9502 12.07 180049............ 01.3278 14.26 190010............ 01.1244 13.57 190130............ 01.0520 11.86
170052............ 01.1045 12.81 170137............ 01.1506 16.18 180050............ 01.2987 15.06 190011............ 01.1585 13.25 190131............ 01.2964 14.32
170053............ 00.8956 11.99 170139............ 01.0518 11.91 180051............ 01.3456 13.60 190013............ 01.3692 15.51 190133............ 01.0540 10.90
170054............ 01.0671 12.27 170140............ 01.0645 11.61 180053............ 01.2163 13.52 190014............ 01.0595 13.49 190134............ 00.9924 11.85
170055............ 01.1158 14.16 170142............ 01.2551 15.60 180054............ 01.0523 12.43 190015............ 01.2040 16.70 190135............ 01.4554 20.08
170056............ 00.9899 10.07 170143............ 01.1521 13.23 180055............ 01.1054 13.29 190017............ 01.2604 14.98 190136............ 01.1399 12.08
170057............ 01.0076 14.13 170144............ 01.6074 14.82 180056............ 01.0784 15.70 190018............ 01.2232 15.07 190138............ 00.7376 18.82
170058............ 01.1368 16.33 170145............ 01.1826 13.74 180058............ 00.9120 12.01 190019............ 01.4599 15.79 190140............ 00.9870 11.41
170060............ 01.0095 12.67 170146............ 01.3553 17.87 180059............ 00.8790 11.19 190020............ 01.1434 16.43 190142............ 00.9693 13.12
170061............ 01.2333 11.89 170147............ 01.1927 17.94 180060............ 00.9768 11.01 190025............ 01.2407 12.09 190144............ 01.1976 14.30
170062............ 00.9532 11.22 170148............ 01.4374 17.40 180063............ 01.0505 09.44 190026............ 01.4204 14.85 190145............ 00.9489 13.28
170063............ 00.9660 09.03 170150............ 01.1431 14.56 180064............ 01.2302 12.70 190027............ 01.4175 15.44 190146............ 01.5725 17.87
170064............ 00.9331 11.28 170151............ 01.0535 11.47 180065............ 01.0596 09.61 190029............ 01.1868 15.59 190147............ 00.9619 12.68
170066............ 00.9185 11.39 170152............ 00.9490 13.46 180066............ 01.2304 17.26 190033............ 00.8818 09.88 190148............ 00.9425 11.65
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Avg. Avg. Avg. Avg. Avg.
Provider Case mix hour Provider Case mix hour Provider Case mix hour Provider Case mix hour Provider Case mix hour
index wage index wage index wage index wage index wage
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
190149............ 00.9929 10.60 200021............ 01.1487 17.17 210055............ 01.2113 26.02 220090............ 01.1993 20.51 230058............ 01.1252 15.97
190151............ 01.0876 11.14 200023............ 00.8912 15.25 210056............ 01.4275 15.73 220092............ 01.2503 20.92 230059............ 01.4661 18.12
190152............ 01.4102 19.90 200024............ 01.2557 18.55 210057............ 01.3256 22.58 220094............ 01.2099 18.76 230060............ 01.3317 16.27
190155............ 00.9849 14.75 200025............ 01.1783 18.48 210058............ 01.7447 17.53 220095............ 01.2315 17.94 230062............ 01.1130 14.71
190156............ 00.8862 11.37 200026............ 01.0457 15.56 210059............ 01.3134 21.97 220097............ 01.1025 19.24 230063............ 01.3458 17.81
190158............ 01.3048 20.92 200027............ 01.2207 15.52 210060............ 01.0967 21.07 220098............ 01.2361 17.34 230065............ 01.4526 18.13
190160............ 01.2539 14.82 200028............ 00.9634 15.57 210061............ 01.0430 ....... 220099............ 01.1392 16.77 230066............ 01.3152 18.55
190161............ 01.0117 13.12 200031............ 01.2310 14.32 220001............ 01.1976 20.13 220100............ 01.2219 21.66 230068............ 01.4296 20.00
190162............ 01.2364 21.67 200032............ 01.2057 17.73 220002............ 01.5483 21.50 220101............ 01.4460 23.37 230069............ 01.1205 18.20
190164............ 01.0920 16.49 200033............ 01.6964 19.02 220003............ 01.0701 16.57 220104............ 01.2209 22.59 230070............ 01.4620 18.67
190166............ 01.0211 13.69 200034............ 01.2233 16.82 220004............ 01.1907 19.23 220105............ 01.1869 21.38 230071............ 00.8421 20.02
190167............ 01.2466 17.25 200037............ 01.1715 15.27 220006............ 01.3611 20.97 220106............ 01.2377 21.02 230072............ 01.2440 17.55
190170............ 00.9827 12.41 200038............ 01.0836 17.59 220008............ 01.2043 18.57 220107............ 01.1978 18.62 230075............ 01.5034 18.69
190173............ 01.4630 20.83 200039............ 01.2581 16.94 220010............ 01.2376 20.19 220108............ 01.1328 20.00 230076............ 01.3257 18.86
190175............ 01.4110 ....... 200040............ 01.0808 15.62 220011............ 01.1200 28.03 220110............ 02.0106 29.37 230077............ 02.0001 18.35
190176............ 01.6417 17.06 200041............ 01.1404 16.98 220012............ 01.3024 26.53 220111............ 01.2194 19.33 230078............ 01.2068 14.77
190177............ 01.6197 20.78 200043............ 00.6087 16.71 220015............ 01.1897 19.96 220114............ 01.4568 18.43 230080............ 01.1882 18.22
190178............ 00.9582 10.79 200050............ 01.1492 15.77 220016............ 01.2459 19.14 220116............ 01.8553 23.87 230081............ 01.1626 16.37
190182............ 00.9566 20.15 200051............ 00.9912 17.33 220017............ 01.3072 23.11 220118............ 02.0244 25.34 230082............ 01.1171 14.65
190183............ 01.1614 12.24 200052............ 01.0230 13.59 220019............ 01.1584 18.25 220119............ 01.3055 23.40 230085............ 01.0995 16.38
190184............ 01.0158 11.69 200055............ 01.0929 15.03 220020............ 01.1232 17.89 220120............ 01.2446 18.85 230086............ 01.0390 14.27
190185............ 01.2193 19.21 200062............ 00.9693 14.32 220021............ 01.3770 22.08 220123............ 00.9948 22.88 230087............ 01.0361 13.82
190186............ 00.9482 12.11 200063............ 01.1759 16.86 220023............ 01.1947 18.44 220126............ 01.2639 17.78 230089............ 01.3695 21.88
190187............ 00.9318 12.65 200066............ 01.2341 14.87 220024............ 01.1843 18.45 220128............ 01.1216 22.23 230092............ 01.2787 17.42
190189............ 00.7764 16.06 210001............ 01.3646 17.18 220025............ 01.1360 17.91 220133............ 00.8589 28.96 230093............ 01.2534 18.00
190190............ 01.0161 18.85 210002............ 02.0515 16.27 220028............ 01.4387 20.23 220135............ 01.1607 22.89 230095............ 01.1863 15.62
190191............ 01.2715 20.41 210003............ 01.5173 26.44 220029............ 01.1282 21.86 220153............ 00.9800 17.41 230096............ 01.1620 18.32
190193............ 01.2707 19.19 210004............ 01.3041 24.62 220030............ 01.0843 15.28 220154............ 00.9489 19.60 230097............ 01.5679 17.19
190194............ 01.1518 18.53 210005............ 01.1988 18.75 220031............ 01.6928 25.43 220156............ 01.3161 19.38 230099............ 01.2435 18.35
190196............ 00.8489 16.88 210006............ 01.0805 16.17 220033............ 01.3632 19.43 220162............ 01.4775 ....... 230100............ 01.2387 14.49
190197............ 01.2858 17.69 210007............ 01.5575 19.41 220035............ 01.2434 20.33 220163............ 01.9504 22.98 230101............ 01.0969 15.97
190199............ 01.3781 12.37 210008............ 01.3734 19.80 220036............ 01.6474 21.93 220171............ 01.7211 22.19 230102............ 00.7834 ......
190200............ 01.5574 18.93 210009............ 01.7273 18.18 220038............ 01.3326 20.40 220897............ 04.8013 ....... 230103............ 01.0500 16.10
190201............ 01.2697 17.92 210010............ 01.2191 15.74 220041............ 01.1978 20.15 230001............ 01.2107 15.09 230104............ 01.6245 19.92
190202............ 01.5201 18.78 210011............ 01.2655 19.58 220042............ 01.2521 22.65 230002............ 01.2674 18.51 230105............ 01.5944 18.07
190203............ 01.5031 19.57 210012............ 01.5475 20.57 220046............ 01.4143 21.28 230003............ 01.1446 17.63 230106............ 01.1545 16.99
190204............ 01.4792 20.13 210013............ 01.2654 20.26 220049............ 01.2639 21.92 230004............ 01.6481 20.75 230107............ 00.8769 11.85
190205............ 01.8112 16.91 210015............ 01.1746 18.47 220050............ 01.0680 16.72 230005............ 01.2896 17.44 230108............ 01.2212 15.90
190206............ 01.4616 20.80 210016............ 01.7430 19.90 220051............ 01.2295 20.11 230006............ 01.1046 15.62 230110............ 01.2393 16.49
190207............ 01.1994 18.41 210017............ 01.1089 15.93 220052............ 01.2703 23.12 230007............ 01.0047 16.93 230111............ 01.0595 14.14
190208............ 00.8324 09.96 210018............ 01.2700 20.00 220053............ 01.2871 19.36 230012............ 00.6001 12.54 230113............ 00.9922 17.34
190211............ 00.6056 11.52 210019............ 01.3205 16.54 220055............ 01.3639 19.25 230013............ 01.3303 19.57 230114............ 00.6287 20.38
190212............ 00.7321 12.23 210022............ 01.4198 19.43 220057............ 01.3603 22.51 230015............ 01.1594 18.65 230115............ 00.9767 14.41
190216............ 00.6297 18.37 210023............ 01.3483 19.46 220058............ 01.0610 18.83 230017............ 01.5654 20.01 230116............ 00.9194 14.42
190217............ 00.9191 ....... 210024............ 01.3754 17.35 220060............ 01.1489 23.11 230019............ 01.4946 20.56 230117............ 01.8754 22.68
190218............ 01.0516 ....... 210025............ 01.3202 17.00 220062............ 00.6790 18.68 230020............ 01.6382 19.60 230118............ 01.2164 15.76
190223............ 00.5207 ....... 210026............ 01.3603 22.97 220063............ 01.2217 18.81 230021............ 01.5867 16.12 230119............ 01.3453 22.01
190226............ 00.8135 ....... 210027............ 01.2333 15.59 220064............ 01.1869 20.35 230022............ 01.3133 16.98 230120............ 01.1522 23.67
190227............ 00.8873 ....... 210028............ 01.2118 16.10 220065............ 01.1891 19.93 230024............ 01.4936 23.87 230121............ 01.3023 18.60
190229............ 02.4642 ....... 210029............ 01.3271 17.21 220066............ 01.3085 18.74 230027............ 01.1037 14.80 230122............ 01.3015 17.81
190230............ 00.8400 ....... 210030............ 01.0685 18.36 220067............ 01.2643 22.39 230029............ 01.5937 20.50 230124............ 01.1111 16.69
190231............ 01.1981 ....... 210031............ 01.6197 17.91 220068............ 00.5785 15.96 230030............ 01.2668 16.14 230125............ 01.3058 13.25
190232............ 01.7205 ....... 210032............ 01.1992 18.14 220070............ 01.2733 17.86 230031............ 01.4708 18.10 230128............ 01.4402 19.92
200001............ 01.2566 14.52 210033............ 01.1728 17.70 220071............ 01.8242 24.13 230032............ 01.7439 18.41 230129............ 01.9293 19.58
200002............ 01.0559 16.63 210034............ 01.3497 19.13 220073............ 01.3852 23.80 230034............ 01.1872 15.14 230130............ 01.6340 21.89
200003............ 01.1171 15.66 210035............ 01.2142 20.18 220074............ 01.2794 20.97 230035............ 01.1903 16.81 230132............ 01.4283 21.06
200006............ 01.1701 15.38 210037............ 01.2548 15.17 220075............ 01.2079 18.15 230036............ 01.2920 18.69 230133............ 01.2463 14.88
200007............ 00.9811 14.93 210038............ 01.4342 19.79 220076............ 01.1689 21.63 230037............ 01.1725 16.35 230134............ 01.1369 16.43
200008............ 01.2424 18.02 210039............ 01.1532 15.16 220077............ 01.6349 21.71 230038............ 01.6738 20.24 230135............ 01.2139 19.52
200009............ 01.7323 19.47 210040............ 01.3767 19.85 220079............ 01.0974 20.24 230040............ 01.2196 17.05 230137............ 01.1843 17.53
200012............ 01.1162 15.58 210043............ 01.2576 20.43 220080............ 01.2793 17.64 230041............ 01.1727 17.55 230141............ 01.6069 20.25
200013............ 01.1207 14.58 210044............ 01.2302 20.56 220081............ 01.0455 21.45 230042............ 01.1831 18.66 230142............ 01.1826 19.33
200015............ 01.2633 16.46 210045............ 00.9736 11.99 220082............ 01.2554 17.24 230046............ 01.7722 25.27 230143............ 01.2154 15.80
200016............ 01.0159 16.05 210046............ 01.1333 12.11 220083............ 01.1952 19.46 230047............ 01.2937 19.18 230144............ 01.1448 20.99
200017............ 01.2461 17.38 210048............ 01.2058 21.96 220084............ 01.2206 23.28 230053............ 01.5048 23.90 230145............ 01.1262 14.78
200018............ 01.1752 14.04 210049............ 01.1165 16.76 220086............ 01.5367 24.89 230054............ 01.7859 18.80 230146............ 01.2901 19.28
200019............ 01.2513 17.59 210051............ 01.3824 13.41 220088............ 01.5488 21.94 230055............ 01.1569 16.59 230147............ 01.5230 19.33
200020............ 01.1539 19.52 210054............ 01.2555 19.16 220089............ 01.2981 23.19 230056............ 00.9682 13.06 230149............ 01.2085 14.21
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[[Page 45874]]
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Avg. Avg. Avg. Avg. Avg.
Provider Case mix hour Provider Case mix hour Provider Case mix hour Provider Case mix hour Provider Case mix hour
index wage index wage index wage index wage index wage
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
230151............ 01.3233 19.88 240002............ 01.6725 19.53 240090............ 01.0732 13.12 240193............ 01.0606 14.44 250081............ 01.2292 14.24
230153............ 01.0349 14.92 240003............ 01.1479 23.37 240091............ 01.0937 10.92 240196............ 00.6031 18.69 250082............ 01.2324 12.01
230154............ 00.9714 12.93 240004............ 01.4625 19.26 240093............ 01.3102 15.75 240200............ 00.8656 12.36 250083............ 01.0859 11.71
230155............ 01.0761 13.24 240005............ 00.8750 13.13 240094............ 00.9900 16.21 240205............ 00.9024 ....... 250084............ 01.1326 12.46
230156............ 01.6534 21.08 240006............ 01.0912 18.30 240096............ 01.0972 15.05 240206............ 00.8925 ....... 250085............ 01.0384 11.38
230157............ 01.2631 18.67 240007............ 01.1001 14.77 240097............ 01.0203 16.73 240207............ 01.2148 20.96 250088............ 00.9623 14.19
230159............ 01.3273 18.09 240008............ 01.1026 13.42 240098............ 00.9520 14.88 240210............ 01.2573 21.49 250089............ 01.1194 11.05
230161............ 00.9933 12.75 240009............ 01.0008 15.30 240099............ 01.0626 11.12 240211............ 00.9051 11.55 250093............ 01.1480 12.10
230162............ 00.9084 14.55 240010............ 01.9591 20.03 240100............ 01.2660 18.09 250001............ 01.6028 15.00 250094............ 01.2904 13.80
230165............ 01.8106 20.30 240011............ 01.1175 15.51 240101............ 01.2004 16.22 250002............ 00.7930 12.37 250095............ 00.9758 12.64
230167............ 01.2554 18.08 240013............ 01.2838 15.46 240102............ 00.9699 13.30 250003............ 01.0075 12.86 250096............ 01.2819 15.13
230169............ 01.3305 20.76 240014............ 01.0662 16.73 240103............ 01.1370 14.12 250004............ 01.4407 14.26 250097............ 01.1086 13.52
230171............ 01.0332 14.03 240016............ 01.3937 14.72 240104............ 01.1893 19.56 250005............ 00.9885 09.59 250098............ 00.8759 11.22
230172............ 01.2727 22.25 240017............ 01.1536 14.77 240105............ 01.0763 13.71 250006............ 00.9874 13.07 250099............ 01.2391 11.86
230174............ 01.2418 17.96 240018............ 01.2886 15.31 240106............ 01.2773 22.45 250007............ 01.2429 16.54 250100............ 01.2131 12.66
230175............ 02.6753 14.23 240019............ 01.2248 19.80 240107............ 00.9785 13.40 250008............ 00.9665 10.63 250101............ 00.9434 09.57
230176............ 01.2043 19.69 240020............ 01.1723 17.23 240108............ 00.9827 11.10 250009............ 01.1540 12.76 250102............ 01.4660 13.97
230178............ 01.0119 14.97 240021............ 00.9716 12.83 240109............ 00.9555 13.75 250010............ 01.0241 11.13 250104............ 01.2793 14.47
230180............ 01.1001 14.82 240022............ 01.1386 16.66 240110............ 00.9468 14.99 250012............ 00.9571 14.17 250105............ 00.8550 11.42
230184............ 01.1705 16.11 240023............ 01.0863 15.38 240111............ 00.9794 12.94 250015............ 01.0999 12.36 250107............ 00.8983 13.99
230186............ 01.3015 15.69 240025............ 01.2377 13.94 240112............ 01.0860 13.13 250017............ 00.9522 12.98 250109............ 00.9693 12.07
230188............ 01.1288 15.61 240027............ 01.0029 12.39 240114............ 01.0045 10.23 250018............ 00.9424 10.22 250112............ 00.9521 12.65
230189............ 00.9168 14.34 240028............ 01.1422 15.53 240115............ 01.6327 21.28 250019............ 01.3283 16.89 250117............ 01.0319 12.65
230190............ 01.0148 20.60 240029............ 01.2204 15.39 240116............ 00.8833 12.64 250020............ 00.9812 09.79 250119............ 01.2539 11.54
230191............ 00.9038 14.34 240030............ 01.3116 16.01 240117............ 01.0892 16.56 250021............ 00.8899 07.83 250120............ 01.0502 11.96
230193............ 01.2146 16.81 240031............ 00.9538 12.78 240119............ 00.8532 16.27 250023............ 00.8958 09.70 250122............ 01.3088 14.29
230194............ 01.1621 13.35 240036............ 01.4871 18.61 240121............ 00.8919 17.30 250024............ 00.9704 08.93 250123............ 01.4131 18.33
230195............ 01.2654 21.05 240037............ 01.0790 15.12 240122............ 01.0333 16.04 250025............ 01.1605 14.21 250124............ 00.8930 11.34
230197............ 01.2729 20.03 240038............ 01.4674 21.40 240123............ 01.0160 12.31 250027............ 01.0442 10.04 250125............ 01.3329 15.75
230199............ 01.1844 16.77 240040............ 01.2418 18.94 240124............ 01.0500 15.19 250029............ 00.8985 11.10 250126............ 01.0024 12.25
230201............ 01.0422 13.64 240041............ 01.1943 14.12 240125............ 00.9073 10.62 250030............ 00.9668 11.80 250127............ 00.7908 ......
230204............ 01.3354 19.61 240043............ 01.2025 16.03 240127............ 00.9941 11.24 250031............ 01.3816 17.69 250128............ 00.9436 10.61
230205............ 01.1139 15.36 240044............ 01.1743 15.76 240128............ 01.0878 13.49 250032............ 01.2589 15.96 250131............ 01.0283 09.45
230207............ 01.2058 19.06 240045............ 01.0584 16.81 240129............ 00.9651 11.01 250033............ 00.9355 12.59 250134............ 00.9520 11.58
230208............ 01.1852 14.67 240047............ 01.4203 17.39 240130............ 00.9793 14.34 250034............ 01.4922 12.38 250136............ 00.8671 16.62
230211............ 00.9895 13.41 240048............ 01.2660 20.88 240132............ 01.2199 21.55 250035............ 00.8666 12.03 250138............ 01.3257 16.03
230212............ 01.0473 19.14 240049............ 01.6889 20.76 240133............ 01.1223 15.52 250036............ 00.9908 10.24 250140............ 00.8057 09.41
230213............ 01.0531 11.90 240050............ 01.1268 17.74 240135............ 00.9209 11.04 250037............ 00.8841 08.83 250141............ 01.2412 14.89
230216............ 01.4062 14.96 240051............ 00.9170 16.00 240137............ 01.1889 14.43 250038............ 00.9733 09.93 250144............ 00.9467 ......
230217............ 01.1401 17.17 240052............ 01.2359 16.24 240138............ 00.9656 11.55 250039............ 01.0067 10.13 250145............ 00.8829 ......
230219............ 00.9667 12.74 240053............ 01.5047 19.08 240139............ 00.9549 14.97 250040............ 01.3264 14.88 250146............ 01.0100 ......
230221............ 01.2982 18.57 240056............ 01.2934 19.39 240141............ 01.1105 19.61 250042............ 01.1532 13.22 250148............ 01.0637 ......
230222............ 01.3345 17.89 240057............ 01.7457 21.23 240142............ 01.1063 14.42 250043............ 00.8809 10.27 250149............ 00.9111 ......
230223............ 01.3148 19.52 240058............ 00.9587 09.56 240143............ 00.9185 11.41 250044............ 01.0076 12.85 260001............ 01.6498 15.91
230227............ 01.4498 20.47 240059............ 01.0818 17.97 240144............ 00.9655 13.73 250045............ 01.2115 15.80 260002............ 01.4327 19.48
230228............ 01.2890 17.02 240061............ 01.7137 19.93 240145............ 01.0049 11.38 250047............ 00.9196 08.87 260003............ 00.9751 12.78
230230............ 01.3845 20.01 240063............ 01.5305 20.52 240146............ 00.9799 14.99 250048............ 01.4047 12.62 260004............ 01.0432 12.06
230232............ 01.0545 16.94 240064............ 01.1601 17.31 240148............ 01.0008 10.45 250049............ 00.8974 10.42 260005............ 01.5844 19.17
230235............ 01.0046 14.62 240065............ 00.9338 10.64 240150............ 00.8780 10.86 250050............ 01.2596 11.28 260006............ 01.4804 16.01
230236............ 01.3262 20.31 240066............ 01.3795 19.06 240152............ 01.0006 17.14 250051............ 00.8750 08.96 260007............ 01.4060 16.14
230239............ 01.1482 14.99 240069............ 01.1330 17.24 240153............ 01.0192 14.24 250057............ 01.1491 12.74 260008............ 01.2376 13.90
230241............ 01.1550 16.43 240071............ 01.1292 17.46 240154............ 00.9905 14.61 250058............ 01.1665 12.27 260009............ 01.2653 15.01
230244............ 01.3835 18.88 240072............ 01.0019 15.57 240155............ 00.9286 16.12 250059............ 01.1891 11.77 260011............ 01.6051 16.63
230253............ 01.0636 16.84 240073............ 00.9783 14.01 240157............ 01.0225 12.12 250060............ 00.8058 11.28 260012............ 01.0636 11.88
230254............ 01.2272 21.93 240075............ 01.2057 18.33 240160............ 00.9496 14.46 250061............ 00.8775 09.15 260013............ 01.1493 13.50
230257............ 01.1250 17.12 240076............ 01.1450 19.11 240161............ 00.9605 14.31 250063............ 00.8500 12.49 260014............ 01.7535 17.79
230259............ 01.2698 18.67 240077............ 00.9211 12.69 240162............ 00.9630 14.88 250065............ 00.9011 10.82 260015............ 01.2443 12.97
230264............ 01.2471 16.92 240078............ 01.4412 19.92 240163............ 00.8630 13.46 250066............ 00.9326 12.03 260017............ 01.1937 12.42
230269............ 01.2450 21.14 240079............ 01.0116 13.47 240166............ 01.1232 14.50 250067............ 01.0946 12.22 260018............ 00.9428 08.66
230270............ 01.2233 18.95 240080............ 01.4123 19.62 240169............ 00.9513 13.93 250068............ 00.8683 12.14 260019............ 01.0687 13.01
230273............ 01.5933 19.35 240082............ 01.1392 14.18 240170............ 01.1212 14.12 250069............ 01.2544 12.65 260020............ 01.6841 19.79
230275............ 00.6409 15.75 240083............ 01.3350 17.68 240171............ 01.0074 13.83 250071............ 00.9869 11.25 260021............ 01.4693 16.68
230276............ 00.8837 15.48 240084............ 01.3215 16.20 240172............ 01.0814 14.56 250072............ 01.2924 15.11 260022............ 01.3476 14.85
230277............ 01.2088 18.95 240085............ 00.9135 15.23 240173............ 01.0091 14.49 250073............ 01.0574 09.16 260023............ 01.2169 14.03
230278............ 01.6978 17.19 240086............ 01.0879 14.33 240179............ 01.0502 14.05 250076............ 01.0126 11.04 260024............ 00.9975 11.71
230280............ 00.9203 ....... 240087............ 01.1561 14.21 240180............ 00.9111 10.44 250077............ 00.9418 10.20 260025............ 01.3026 13.16
230281............ 01.4676 ....... 240088............ 01.4415 17.29 240184............ 00.9037 11.75 250078............ 01.3897 13.77 260027............ 01.5904 18.65
240001............ 01.5227 20.18 240089............ 01.0048 14.73 240187............ 01.2634 15.97 250079............ 00.8444 12.64 260029............ 01.1107 17.08
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Avg. Avg. Avg. Avg. Avg.
Provider Case mix hour Provider Case mix hour Provider Case mix hour Provider Case mix hour Provider Case mix hour
index wage index wage index wage index wage index wage
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
260030............ 01.3033 09.37 260137............ 01.2883 14.24 270050............ 01.0455 16.53 280058............ 01.1987 13.63 290036............ 01.0268 ......
260031............ 01.4678 18.03 260138............ 01.8420 19.32 270051............ 01.2741 18.12 280060............ 01.5876 18.29 290037............ 01.7750 ......
260032............ 01.6073 13.18 260141............ 01.8940 17.33 270052............ 01.0618 13.84 280061............ 01.4422 14.63 290038............ 01.1870 ......
260034............ 01.0152 12.93 260142............ 01.1868 14.08 270053............ 00.9970 07.13 280062............ 01.1923 10.12 300001............ 01.4047 19.78
260035............ 01.0652 11.41 260143............ 00.9867 09.51 270057............ 01.1713 15.18 280064............ 00.9693 12.15 300003............ 01.7941 21.09
260036............ 01.0897 14.27 260146............ 01.4828 19.71 270058............ 00.9807 10.66 280065............ 01.2507 15.96 300005............ 01.2685 17.44
260037............ 01.3303 14.40 260147............ 01.0149 12.16 270059............ 00.8267 13.66 280066............ 01.0279 11.07 300006............ 01.1101 15.99
260039............ 01.2388 10.72 260148............ 01.0073 12.55 270060............ 00.9644 13.42 280068............ 00.9847 08.59 300007............ 01.1781 17.72
260040............ 01.6153 14.88 260158............ 01.1788 11.40 270063............ 00.9125 13.15 280070............ 01.0000 09.86 300008............ 01.2270 16.18
260042............ 01.3286 15.75 260159............ 01.3434 18.30 270068............ 00.9184 12.25 280073............ 01.0751 12.53 300009............ 01.1985 15.47
260044............ 01.0828 13.78 260160............ 01.0914 12.54 270072............ 00.9576 12.39 280074............ 01.0409 12.24 300010............ 01.2030 17.36
260047............ 01.4248 13.91 260162............ 01.5099 16.23 270073............ 01.1034 10.27 280075............ 01.3095 11.50 300011............ 01.3272 21.08
260048............ 01.2491 17.03 260163............ 01.1785 13.51 270074............ 00.9035 ....... 280076............ 01.0748 12.42 300012............ 01.2920 21.68
260050............ 01.1065 13.74 260164............ 01.0462 11.93 270075............ 00.8783 ....... 280077............ 01.3632 16.20 300013............ 01.1784 16.16
260052............ 01.2727 16.70 260166............ 01.1547 18.14 270076............ 00.7732 ....... 280079............ 01.0096 08.85 300014............ 01.2554 17.01
260053............ 01.1634 09.81 260172............ 01.0140 11.31 270079............ 00.8806 13.15 280080............ 01.2501 10.50 300015............ 01.1415 16.94
260054............ 01.2584 15.10 260173............ 00.9894 10.67 270080............ 01.1206 14.02 280081............ 01.7016 18.52 300016............ 01.2632 19.06
260055............ 01.0724 12.81 260175............ 01.1485 13.86 270081............ 01.0037 10.21 280082............ 01.0906 11.81 300017............ 01.1739 19.63
260057............ 01.1608 13.77 260176............ 01.5967 15.21 270082............ 00.9086 16.06 280083............ 01.0470 12.63 300018............ 01.2143 18.68
260059............ 01.1236 12.90 260177............ 01.2822 18.47 270083............ 01.0332 11.82 280084............ 01.0205 10.55 300019............ 01.2254 18.15
260061............ 01.1071 11.10 260178............ 01.4986 19.19 270084............ 00.8579 13.29 280085............ 00.5745 13.22 300020............ 01.2443 18.81
260062............ 01.1874 15.30 260179............ 01.5429 20.22 270085............ 01.1363 ....... 280088............ 01.6955 17.05 300021............ 01.1653 15.20
260063............ 01.0964 14.23 260180............ 01.7170 17.79 280001............ 01.1549 14.18 280089............ 01.0291 13.15 300022............ 01.1082 16.54
260064............ 01.3736 14.63 260183............ 01.6342 15.54 280003............ 01.9107 17.34 280090............ 01.0387 11.51 300023............ 01.2794 19.11
260065............ 01.7362 14.50 260186............ 01.1915 14.51 280005............ 01.4470 16.78 280091............ 01.1348 14.23 300024............ 01.2872 17.09
260066............ 01.1245 12.18 260188............ 01.2978 16.33 280009............ 01.5926 15.76 280092............ 00.8866 11.69 300028............ 01.3059 15.13
260067............ 00.9050 10.16 260189............ 00.9718 09.35 280010............ 00.9153 13.81 280094............ 01.1289 13.71 300029............ 01.2839 20.32
260068............ 01.7168 18.00 260190............ 01.1852 18.20 280011............ 00.9466 11.03 280097............ 00.9848 12.08 300033............ 01.0583 13.69
260070............ 01.2656 11.28 260191............ 01.1932 16.21 280012............ 01.1851 13.28 280098............ 00.9036 09.92 300034............ 01.9240 21.01
260073............ 01.0078 11.49 260193............ 01.2087 17.30 280013............ 01.9950 20.71 280101............ 01.0669 09.77 310001............ 01.6930 23.44
260074............ 01.3208 14.05 260195............ 01.1672 13.70 280014............ 00.9454 10.97 280102............ 01.1276 10.31 310002............ 01.6575 24.76
260077............ 01.5591 16.08 260197............ 01.2675 22.49 280015............ 01.1157 12.78 280104............ 01.0155 10.32 310003............ 01.2015 21.26
260078............ 01.1100 14.31 260198............ 01.2556 14.73 280017............ 01.1947 13.37 280105............ 01.2556 15.99 310005............ 01.1831 20.09
260079............ 01.0374 11.13 260200............ 01.2580 20.58 280018............ 01.0064 12.08 280106............ 00.9271 13.01 310006............ 01.2093 20.07
260080............ 00.9466 09.28 260202............ 01.1449 17.37 280020............ 01.5132 17.44 280107............ 01.0584 10.79 310008............ 01.2635 19.90
260081............ 01.3870 17.21 260204............ 00.6808 ....... 280021............ 01.2597 14.03 280108............ 01.1035 12.56 310009............ 01.2280 20.09
260082............ 01.1706 13.16 270002............ 01.2061 14.67 280022............ 00.9537 10.41 280109............ 00.8849 10.22 310010............ 01.3079 17.46
260085............ 01.5221 18.65 270003............ 01.2427 17.35 280023............ 01.3719 14.33 280110............ 01.0153 10.55 310011............ 01.2881 19.99
260086............ 01.0078 12.28 270004............ 01.6741 16.44 280024............ 00.9370 10.93 280111............ 01.2565 15.55 310012............ 01.5330 22.98
260089............ 01.0433 12.88 270006............ 01.0315 11.79 280025............ 01.0059 10.58 280114............ 00.9330 10.07 310013............ 01.3256 19.19
260091............ 01.6144 18.97 270007............ 00.9035 12.34 280026............ 01.0774 12.62 280115............ 00.9760 13.60 310014............ 01.6329 22.95
260094............ 01.0888 14.92 270009............ 01.0522 18.56 280028............ 01.0505 12.46 280117............ 01.1662 14.07 310015............ 01.7741 23.86
260095............ 01.4311 16.21 270011............ 01.1422 14.69 280029............ 01.0102 12.23 280118............ 00.9862 13.25 310016............ 01.2302 21.83
260096............ 01.5493 19.82 270012............ 01.4573 17.25 280030............ 01.7873 22.60 280119............ 00.9944 ....... 310017............ 01.3436 21.36
260097............ 01.1488 14.83 270013............ 01.3235 16.27 280031............ 01.0720 12.01 280123............ 00.9270 15.00 310018............ 01.2156 21.47
260100............ 01.1269 12.77 270014............ 01.6560 15.12 280032............ 01.2383 14.78 290001............ 01.7427 21.82 310019............ 01.6949 21.25
260102............ 01.0363 15.72 270016............ 00.8256 10.20 280033............ 01.0153 13.52 290002............ 00.9190 17.72 310020............ 01.1972 18.78
260103............ 01.3221 17.08 270017............ 01.2740 16.23 280034............ 01.1911 13.66 290003............ 01.6587 20.91 310021............ 01.2836 19.65
260104............ 01.6613 18.27 270019............ 00.9937 12.23 280035............ 00.8819 11.62 290005............ 01.2678 19.56 310022............ 01.2485 18.19
260105............ 01.8256 18.29 270021............ 01.1369 14.71 280037............ 00.9979 12.06 290006............ 01.0337 16.63 310024............ 01.2319 21.47
260107............ 01.3910 17.90 270023............ 01.3182 17.63 280038............ 01.0597 12.86 290007............ 01.7782 22.22 310025............ 01.1869 20.24
260108............ 01.7513 17.38 270024............ 00.9847 11.35 280039............ 01.2712 13.10 290008............ 01.2063 17.86 310026............ 01.2706 21.12
260109............ 01.0046 11.51 270026............ 00.9131 12.56 280040............ 01.6146 18.26 290009............ 01.5580 20.26 310027............ 01.3144 17.61
260110............ 01.5467 14.55 270027............ 01.0305 12.04 280041............ 01.0572 10.95 290010............ 01.1552 17.50 310028............ 01.1385 19.28
260111............ 00.8939 10.83 270028............ 01.0693 14.45 280042............ 01.1705 13.58 290011............ 00.9691 13.05 310029............ 01.7872 20.90
260112............ 01.4469 17.09 270029............ 01.0320 14.46 280043............ 01.0597 12.23 290012............ 01.4465 19.66 310031............ 02.6050 23.85
260113............ 01.1577 13.08 270031............ 00.9049 09.71 280045............ 01.1825 13.09 290013............ 01.1414 15.42 310032............ 01.2557 19.04
260115............ 01.1768 14.97 270032............ 01.1444 15.72 280046............ 01.0708 10.66 290014............ 01.0009 16.60 310034............ 01.2014 18.21
260116............ 01.1359 12.68 270033............ 00.8783 21.10 280047............ 01.1624 16.07 290015............ 00.9889 12.99 310036............ 01.2138 17.92
260119............ 01.1926 13.52 270035............ 00.9894 14.73 280048............ 01.0499 10.85 290016............ 01.3306 15.75 310037............ 01.2388 24.01
260120............ 01.2261 14.49 270036............ 01.0120 09.12 280049............ 01.1043 13.00 290018............ 00.9628 22.74 310038............ 01.7727 22.21
260122............ 01.1602 12.04 270039............ 00.9390 12.62 280050............ 01.0174 11.53 290019............ 01.2518 17.47 310039............ 01.2783 19.78
260123............ 01.0178 10.06 270040............ 01.0903 19.48 280051............ 01.0446 14.71 290020............ 01.2240 18.37 310040............ 01.2683 21.87
260127............ 00.9980 14.37 270041............ 01.0725 10.12 280052............ 01.1260 10.91 290021............ 01.5718 20.67 310041............ 01.2889 20.71
260128............ 01.0173 08.68 270044............ 01.2618 14.10 280054............ 01.2447 14.44 290022............ 01.6200 23.07 310042............ 01.1596 20.03
260129............ 01.1495 13.09 270046............ 00.9502 15.13 280055............ 00.9253 10.12 290027............ 01.0027 13.90 310043............ 01.1812 20.19
260131............ 01.3359 15.39 270048............ 01.0910 12.39 280056............ 01.0855 10.24 290029............ 00.8842 ....... 310044............ 01.3145 19.51
260134............ 01.1840 13.51 270049............ 01.7658 16.51 280057............ 00.9872 14.21 290032............ 01.3433 19.50 310045............ 01.3120 24.22
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[[Page 45876]]
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Avg. Avg. Avg. Avg. Avg.
Provider Case mix hour Provider Case mix hour Provider Case mix hour Provider Case mix hour Provider Case mix hour
index wage index wage index wage index wage index wage
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
310047............ 01.2978 21.60 320032............ 00.9776 20.28 330061............ 01.3120 22.35 330171............ 01.2992 21.23 330268............ 01.0090 14.96
310048............ 01.2227 20.26 320033............ 01.0818 19.40 330062............ 01.0664 15.08 330175............ 01.1063 13.41 330270............ 01.9642 27.18
310049............ 01.2908 20.19 320035............ 01.1660 13.24 330064............ 01.3911 27.78 330177............ 01.0514 12.91 330273............ 01.2855 21.42
310050............ 01.2017 20.51 320037............ 01.3899 12.74 330065............ 01.1624 16.59 330179............ 00.8581 12.51 330275............ 01.2081 18.08
310051............ 01.3227 22.94 320038............ 01.2002 14.49 330066............ 01.2995 17.69 330180............ 01.1690 15.30 330276............ 01.2082 16.38
310052............ 01.2366 19.79 320046............ 01.1906 18.36 330067............ 01.3225 20.03 330181............ 01.3008 27.47 330277............ 01.1319 16.03
310054............ 01.2848 22.08 320048............ 01.2872 14.65 330072............ 01.3563 26.92 330182............ 02.4742 26.72 330279............ 01.3510 16.78
310056............ 01.2278 18.60 320056............ 00.8819 ....... 330073............ 01.1841 13.26 330183............ 01.3763 18.32 330281............ 00.5568 23.06
310057............ 01.2648 18.67 320057............ 00.9639 ....... 330074............ 01.2524 16.33 330184............ 01.3472 23.65 330285............ 01.7116 20.80
310058............ 01.1165 22.53 320058............ 00.7808 ....... 330075............ 01.0753 16.05 330185............ 01.1723 22.73 330286............ 01.3041 22.10
310060............ 01.1764 15.81 320059............ 01.0425 ....... 330078............ 01.4389 16.68 330186............ 00.9130 19.17 330288............ 01.0139 17.60
310061............ 01.1722 18.96 320060............ 00.9410 ....... 330079............ 01.2684 15.57 330188............ 01.2063 16.77 330290............ 01.6417 27.25
310062............ 01.2970 26.34 320061............ 01.1664 ....... 330080............ 01.4665 23.97 330189............ 00.7331 12.31 330293............ 01.1276 13.51
310063............ 01.3226 20.46 320062............ 00.8931 ....... 330082............ 01.1808 17.10 330191............ 01.2892 18.01 330304............ 01.2716 23.24
310064............ 01.2668 20.47 320063............ 01.3211 15.46 330084............ 00.9833 15.94 330193............ 01.3482 24.81 330306............ 01.3707 24.98
310067............ 01.2594 20.36 320065............ 01.2430 17.01 330085............ 01.3460 17.68 330194............ 01.8210 24.97 330307............ 01.1721 17.04
310069............ 01.1730 17.01 320067............ 00.8539 10.32 330086............ 01.2503 23.08 330195............ 01.5873 27.49 330308............ 01.2466 25.87
310070............ 01.3502 21.60 320068............ 00.9034 16.83 330088............ 01.0977 22.97 330196............ 01.3950 24.75 330309............ 01.1999 23.47
310072............ 01.2374 19.41 320069............ 01.0835 13.56 330090............ 01.5160 16.20 330197............ 01.0524 14.34 330314............ 01.4338 20.37
310073............ 01.4817 21.39 320070............ 00.9428 ....... 330091............ 01.3705 17.15 330198............ 01.3620 25.91 330315............ 01.2292 23.02
310074............ 01.3262 20.59 320074............ 01.1259 17.57 330092............ 00.9957 14.04 330199............ 01.2860 23.44 330316............ 01.3096 24.11
310075............ 01.3128 20.53 320076............ 00.9991 16.21 330094............ 01.1855 14.91 330201............ 01.4531 24.83 330327............ 00.8781 15.44
310076............ 01.3226 26.50 320079............ 01.1685 18.53 330095............ 01.2824 16.28 330202............ 01.3373 24.50 330331............ 01.1813 25.65
310077............ 01.4994 22.03 320082............ 01.8075 ....... 330096............ 01.0596 14.40 330203............ 01.3430 18.69 330332............ 01.2836 22.41
310078............ 01.2791 22.48 330001............ 01.2027 23.04 330097............ 01.1475 14.94 330204............ 01.2933 23.88 330333............ 01.2926 23.11
310081............ 01.2164 19.38 330002............ 01.4124 23.83 330100............ 00.6684 24.57 330205............ 01.1975 17.54 330336............ 01.3502 27.66
310083............ 01.2378 21.39 330003............ 01.3158 17.46 330101............ 01.7755 29.73 330208............ 01.2274 22.74 330338............ 01.2396 22.06
310084............ 01.2075 20.18 330004............ 01.2561 19.60 330102............ 01.3522 16.65 330209............ 01.1848 20.53 330339............ 00.8669 17.94
310086............ 01.2176 19.38 330005............ 01.7620 18.94 330103............ 01.2524 15.29 330211............ 01.2925 15.74 330340............ 01.1608 23.73
310087............ 01.2313 18.62 330006............ 01.3185 23.17 330104............ 01.4242 25.67 330212............ 01.1932 19.47 330350............ 01.8072 26.95
310088............ 01.1789 21.00 330007............ 01.3208 16.57 330106............ 01.5662 31.07 330213............ 01.0876 15.58 330353............ 01.2882 28.01
310090............ 01.1946 21.38 330008............ 01.1370 16.15 330107............ 01.2052 22.95 330214............ 01.7088 27.08 330354............ 01.3874 ......
310091............ 01.2415 18.79 330009............ 01.3261 27.98 330108............ 01.1972 15.71 330215............ 01.1519 16.55 330357............ 01.3452 29.51
310092............ 01.3962 19.24 330010............ 01.2191 14.38 330111............ 01.0845 14.47 330218............ 01.1659 15.36 330359............ 00.9345 19.17
310093............ 01.1435 19.43 330011............ 01.2428 16.56 330114............ 00.9193 15.00 330219............ 01.7195 18.75 330372............ 01.2575 21.28
310096............ 01.8860 21.72 330012............ 01.6258 25.68 330115............ 01.1851 14.41 330221............ 01.2718 25.64 330381............ 01.2114 26.55
310105............ 01.2351 20.43 330013............ 02.0631 17.16 330116............ 00.9613 13.66 330222............ 01.2469 15.21 330383............ 01.3259 ......
310108............ 01.3621 19.59 330014............ 01.3639 26.33 330118............ 01.5979 17.36 330223............ 01.1104 15.86 330385............ 01.2184 25.67
310110............ 01.2191 19.32 330016............ 00.9847 15.57 330119............ 01.7237 28.24 330224............ 01.2700 19.31 330386............ 01.2294 19.79
310111............ 01.2455 18.13 330019............ 01.2313 23.83 330121............ 01.0667 13.42 330225............ 01.1576 23.75 330387............ 00.7536 36.27
310112............ 01.2943 19.42 330020............ 01.0911 14.70 330122............ 01.2895 21.37 330226............ 01.2811 16.82 330389............ 01.8055 28.55
310113............ 01.2243 19.35 330023............ 01.1830 21.41 330125............ 01.7519 18.89 330229............ 01.3299 14.48 330390............ 01.2316 24.96
310115............ 01.2390 19.80 330024............ 01.8062 27.93 330126............ 01.1469 19.06 330230............ 01.5420 25.52 330393............ 01.6790 25.15
310116............ 01.2166 20.61 330025............ 01.1635 13.45 330127............ 01.3574 24.53 330231............ 01.1472 26.40 330394............ 01.4862 17.28
310118............ 01.2191 21.18 330027............ 01.4312 29.92 330128............ 01.3303 25.17 330232............ 01.2389 14.65 330395............ 01.3351 26.58
310119............ 01.5589 29.46 330028............ 01.3524 23.16 330132............ 01.0796 13.15 330233............ 01.5462 30.00 330396............ 01.2611 23.98
310120............ 01.0810 17.02 330029............ 01.0937 16.36 330133............ 01.3290 28.20 330234............ 02.1509 27.03 330397............ 01.4810 23.47
310121............ 01.0724 17.85 330030............ 01.2392 15.26 330135............ 01.2226 16.47 330235............ 01.1618 16.46 330398............ 01.2131 25.84
320001............ 01.4366 16.14 330033............ 01.2024 13.36 330136............ 01.2683 19.79 330236............ 01.3663 25.32 330399............ 01.3136 27.41
320002............ 01.3563 21.36 330034............ 00.8669 29.10 330140............ 01.6881 17.07 330238............ 01.1419 13.64 340001............ 01.4375 18.69
320003............ 01.2298 14.20 330036............ 01.2237 21.09 330141............ 01.3453 23.29 330239............ 01.2266 14.38 340002............ 01.8274 17.46
320004............ 01.1229 16.38 330037............ 01.1795 14.71 330144............ 01.0398 13.45 330240............ 01.3143 26.41 340003............ 01.1539 17.44
320005............ 01.3257 18.36 330038............ 01.1869 13.86 330148............ 01.0294 13.70 330241............ 01.9309 20.81 340004............ 01.4844 16.48
320006............ 01.4173 14.16 330039............ 00.8701 13.51 330151............ 01.0525 12.53 330242............ 01.3377 20.60 340005............ 01.2380 12.65
320009............ 01.5156 16.90 330041............ 01.3624 26.36 330152............ 01.3980 26.57 330245............ 01.2460 17.22 340006............ 01.1128 14.19
320011............ 01.0249 17.65 330043............ 01.2325 24.15 330153............ 01.6410 17.53 330246............ 01.2726 22.67 340007............ 01.1584 14.94
320012............ 01.0428 17.37 330044............ 01.2066 16.10 330154............ 01.5523 ....... 330247............ 00.7884 25.42 340008............ 01.2193 15.82
320013............ 01.0889 17.38 330045............ 01.3974 23.27 330157............ 01.2584 18.01 330249............ 01.2357 15.87 340009............ 01.1741 19.21
320014............ 01.0454 09.02 330046............ 01.4962 26.80 330158............ 01.3006 22.12 330250............ 01.2316 15.80 340010............ 01.3038 15.46
320016............ 01.1562 14.52 330047............ 01.2200 16.37 330159............ 01.3142 17.37 330252............ 00.9099 15.14 340011............ 01.1066 13.94
320017............ 01.1504 17.38 330048............ 01.2674 15.50 330160............ 01.4544 27.75 330254............ 00.9916 15.51 340012............ 01.2143 15.39
320018............ 01.4185 16.77 330049............ 01.2673 17.22 330161............ 00.9392 15.60 330258............ 01.3589 23.96 340013............ 01.2166 14.57
320019............ 01.4846 18.67 330053............ 01.1259 14.20 330162............ 01.2563 24.16 330259............ 01.3537 21.55 340014............ 01.5912 18.83
320021............ 01.7030 20.73 330055............ 01.3713 27.96 330163............ 01.1593 16.79 330261............ 01.2206 23.08 340015............ 01.2407 15.33
320022............ 01.2443 17.51 330056............ 01.3550 27.22 330164............ 01.3538 18.48 330263............ 01.0437 15.85 340016............ 01.1503 14.55
320023............ 01.0444 14.13 330057............ 01.6043 17.28 330166............ 00.9855 13.97 330264............ 01.2549 19.42 340017............ 01.3015 14.65
320030............ 01.0646 18.67 330058............ 01.2642 15.35 330167............ 01.5896 26.67 330265............ 01.3454 14.34 340018............ 01.0825 14.66
320031............ 00.9696 11.41 330059............ 01.5861 27.24 330169............ 01.4497 29.07 330267............ 01.2471 21.54 340019............ 01.0463 10.97
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Avg. Avg. Avg. Avg. Avg.
Provider Case mix hour Provider Case mix hour Provider Case mix hour Provider Case mix hour Provider Case mix hour
index wage index wage index wage index wage index wage
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
340020............ 01.2214 19.33 340114............ 01.4370 18.91 350030............ 01.0782 15.42 360052............ 01.6706 17.01 360129............ 01.0212 13.31
340021............ 01.2429 15.10 340115............ 01.5516 17.01 350033............ 00.9414 13.28 360054............ 01.2364 14.87 360130............ 01.0803 13.93
340022............ 01.0861 14.07 340116............ 01.7556 19.43 350034............ 00.9862 14.00 360055............ 01.1887 17.02 360131............ 01.2766 16.41
340023............ 01.3551 16.96 340119............ 01.2827 14.92 350035............ 00.8461 10.06 360056............ 01.4023 14.80 360132............ 01.3067 18.64
340024............ 01.2088 14.35 340120............ 01.0627 12.83 350038............ 00.9999 13.01 360057............ 01.0616 12.70 360133............ 01.4340 17.01
340025............ 01.1085 14.27 340121............ 01.0948 13.86 350039............ 01.0331 13.63 360058............ 01.1741 15.10 360134............ 01.6313 17.77
340027............ 01.2066 14.87 340122............ 01.0074 12.44 350041............ 01.0451 11.63 360059............ 01.5386 19.71 360135............ 01.1456 15.15
340028............ 01.5189 16.47 340123............ 01.1032 14.48 350042............ 01.0138 13.85 360062............ 01.4513 18.00 360136............ 01.0358 14.10
340030............ 01.9236 18.03 340124............ 01.0598 13.16 350043............ 01.4085 15.08 360063............ 01.0436 17.30 360137............ 01.5633 17.61
340031............ 01.0073 11.38 340125............ 01.4126 16.38 350044............ 00.8723 10.01 360064............ 01.4685 18.71 360140............ 00.9977 15.13
340032............ 01.2722 16.65 340126............ 01.4006 16.98 350047............ 01.1514 15.96 360065............ 01.2562 16.05 360141............ 01.4459 19.09
340034............ 01.2862 17.26 340127............ 01.3145 15.68 350049............ 01.0973 09.92 360066............ 01.3256 16.87 360142............ 00.9941 14.51
340035............ 01.1055 14.26 340129............ 01.2766 18.25 350050............ 01.0007 10.35 360067............ 01.1115 11.73 360143............ 01.3138 17.32
340036............ 01.2272 16.44 340130............ 01.3380 15.99 350051............ 00.9666 11.29 360068............ 01.6362 20.80 360144............ 01.3278 19.94
340037............ 01.1607 14.58 340131............ 01.3791 16.02 350053............ 01.0840 09.16 360069............ 01.0676 15.90 360145............ 01.6473 15.96
340038............ 01.1622 14.65 340132............ 01.2661 12.80 350055............ 00.9493 11.52 360070............ 01.5784 16.33 360147............ 01.2733 14.83
340039............ 01.2728 17.98 340133............ 01.1294 14.24 350056............ 00.9567 12.07 360071............ 01.2933 15.64 360148............ 01.1734 15.29
340040............ 01.7442 17.23 340136............ 01.0903 16.92 350058............ 01.0054 11.46 360072............ 01.1550 14.77 360149............ 01.1353 16.99
340041............ 01.2497 15.28 340137............ 01.1904 13.07 350060............ 00.9061 07.20 360074............ 01.3468 18.13 360150............ 01.3102 16.70
340042............ 01.1070 13.11 340138............ 01.1282 14.31 350061............ 01.0508 14.13 360075............ 01.4104 18.42 360151............ 01.3471 16.20
340044............ 01.0368 12.58 340141............ 01.5336 18.20 350063............ 00.8168 ....... 360076............ 01.3080 17.06 360152............ 01.5274 17.02
340045............ 01.0070 08.49 340142............ 01.1924 15.16 350064............ 00.8453 ....... 360077............ 01.4463 18.22 360153............ 01.1435 13.32
340047............ 01.8771 17.46 340143............ 01.3424 18.36 350065............ 00.8966 09.89 360078............ 01.2808 18.19 360154............ 01.0543 12.01
340048............ 00.7695 08.62 340144............ 01.3526 16.96 350066............ 00.8594 ....... 360079............ 01.6831 19.06 360155............ 01.3084 18.30
340049............ 00.6050 15.68 340145............ 01.3006 15.79 360001............ 01.2737 16.58 360080............ 01.0833 14.79 360156............ 01.3318 16.30
340050............ 01.1906 16.12 340146............ 01.0912 12.76 360002............ 01.1539 14.90 360081............ 01.3730 18.30 360159............ 01.1477 17.70
340051............ 01.2434 15.76 340147............ 01.2928 16.80 360003............ 01.7163 19.44 360082............ 01.2993 18.90 360161............ 01.3554 18.52
340052............ 01.0229 18.45 340148............ 01.4258 17.75 360006............ 01.7248 19.60 360083............ 01.2953 15.60 360162............ 01.1934 15.50
340053............ 01.6219 18.66 340151............ 01.1784 13.81 360007............ 01.0537 15.57 360084............ 01.6280 17.52 360163............ 01.8277 18.81
340054............ 01.0768 12.74 340153............ 01.9573 19.41 360008............ 01.2393 15.77 360085............ 01.7866 18.85 360164............ 00.8939 13.53
340055............ 01.2107 16.29 340154............ 01.0753 14.94 360009............ 01.3585 17.14 360086............ 01.4650 15.62 360165............ 01.1586 14.66
340060............ 01.1365 15.32 340155............ 01.4445 19.22 360010............ 01.1699 15.09 360087............ 01.3579 17.19 360166............ 01.1803 16.68
340061............ 01.7024 18.17 340156............ 00.7886 ....... 360011............ 01.2316 17.13 360088............ 01.2297 15.09 360169............ 01.0152 16.77
340063............ 01.0854 14.50 340158............ 01.1620 16.37 360012............ 01.2575 18.10 360089............ 01.1095 16.46 360170............ 01.2081 17.19
340064............ 01.2236 15.48 340159............ 01.1374 15.06 360013............ 01.1234 15.10 360090............ 01.2171 18.32 360172............ 01.4144 16.01
340065............ 01.2563 11.40 340160............ 01.1423 12.04 360014............ 01.1305 16.24 360091............ 01.2693 18.20 360174............ 01.2615 16.86
340067............ 01.2050 13.69 340162............ 01.3232 16.41 360016............ 01.5690 17.58 360092............ 01.3081 17.29 360175............ 01.2606 17.31
340068............ 01.2906 12.83 340164............ 01.4023 17.72 360017............ 01.6623 19.27 360093............ 01.2115 15.93 360176............ 01.1864 13.50
340069............ 01.6454 17.99 340166............ 01.3806 18.12 360018............ 01.5828 18.43 360094............ 01.2319 19.09 360177............ 01.2503 15.44
340070............ 01.2856 16.22 340168............ 00.4892 16.61 360019............ 01.2602 18.17 360095............ 01.3224 15.76 360178............ 01.2477 15.16
340071............ 01.0192 13.98 340170............ 01.2903 ....... 360020............ 01.4408 17.58 360096............ 01.0972 15.60 360179............ 01.3059 18.53
340072............ 01.1001 13.96 340171............ 01.1886 ....... 360021............ 01.2308 17.68 360098............ 01.3847 17.38 360180............ 02.0926 22.00
340073............ 01.4140 19.33 350001............ 01.1048 11.68 360024............ 01.4150 17.78 360099............ 00.9965 15.45 360184............ 00.5635 15.74
340075............ 01.2118 15.40 350002............ 01.7422 16.34 360025............ 01.1647 16.65 360100............ 01.3185 15.79 360185............ 01.2250 16.35
340080............ 01.1487 10.79 350003............ 01.1706 15.20 360026............ 01.1441 15.74 360101............ 01.7121 19.44 360186............ 01.2001 15.60
340084............ 01.0637 13.21 350004............ 01.9130 17.61 360027............ 01.5510 18.78 360102............ 01.2239 18.95 360187............ 01.2755 15.63
340085............ 01.2350 14.60 350005............ 01.1536 11.38 360028............ 01.3557 15.35 360103............ 01.3601 19.18 360188............ 01.0228 14.47
340087............ 01.2050 16.57 350006............ 01.3190 15.87 360029............ 01.1328 15.69 360104............ 01.2382 18.94 360189............ 01.0674 14.86
340088............ 01.1530 16.20 350007............ 00.9819 11.64 360030............ 01.1077 14.24 360106............ 01.0728 14.17 360192............ 01.3026 18.10
340089............ 00.9587 11.53 350008............ 01.0282 17.11 360031............ 01.2692 14.01 360107............ 01.2622 15.52 360193............ 01.2990 14.39
340090............ 01.1072 15.15 350009............ 01.1700 15.04 360032............ 01.1041 15.63 360108............ 01.0507 14.22 360194............ 01.1138 15.67
340091............ 01.6938 18.09 350010............ 01.0948 11.48 360034............ 01.2332 12.05 360109............ 01.1010 16.95 360195............ 01.1665 16.12
340093............ 01.0960 12.41 350011............ 01.8078 16.90 360035............ 01.5032 19.25 360112............ 01.7037 21.03 360197............ 01.1624 16.55
340094............ 01.2541 16.46 350012............ 01.0559 11.94 360036............ 01.1697 17.01 360113............ 01.3399 17.68 360200............ 01.0671 12.61
340096............ 01.2466 15.59 350013............ 01.1172 14.23 360037............ 02.0688 19.75 360114............ 01.1335 15.45 360203............ 01.1252 15.23
340097............ 01.1638 14.13 350014............ 01.0793 10.84 360038............ 01.5302 16.88 360115............ 01.2330 18.39 360204............ 01.2108 15.84
340098............ 01.6534 17.84 350015............ 01.5962 15.49 360039............ 01.2972 15.46 360116............ 01.0463 15.21 360210............ 01.1859 18.60
340099............ 01.1570 13.04 350016............ 01.0047 10.29 360040............ 01.2865 17.57 360118............ 01.3302 16.33 360211............ 01.1862 17.02
340100............ 00.9781 ....... 350017............ 01.3945 14.02 360041............ 01.3229 17.13 360119............ 01.2505 16.21 360212............ 01.4129 18.54
340101............ 00.9994 11.37 350018............ 01.1037 10.15 360042............ 01.1307 15.94 360120............ 00.6082 ....... 360213............ 01.1319 15.72
340104............ 00.9394 10.52 350019............ 01.6020 17.70 360044............ 01.0998 15.06 360121............ 01.2473 16.95 360218............ 01.2494 15.77
340105............ 01.3234 17.43 350020............ 01.3474 15.80 360045............ 01.5166 19.48 360122............ 01.3128 17.15 360230............ 01.2932 19.39
340106............ 01.0977 16.14 350021............ 01.0671 10.47 360046............ 01.0676 17.35 360123............ 01.2101 17.96 360231............ 01.0985 12.30
340107............ 01.2666 15.88 350023............ 00.8750 14.45 360047............ 01.1655 13.68 360124............ 01.2525 16.62 360232............ 01.2411 20.25
340109............ 01.3020 15.08 350024............ 01.0840 12.46 360048............ 01.7585 20.91 360125............ 01.0866 15.71 360234............ 01.3135 17.37
340111............ 01.2307 13.16 350025............ 01.0046 13.17 360049............ 01.3468 17.28 360126............ 01.2385 18.24 360236............ 01.1914 16.82
340112............ 01.0315 12.98 350027............ 00.9939 13.76 360050............ 01.0922 11.62 360127............ 01.0931 15.24 360238............ 01.0788 12.57
340113............ 01.9539 19.22 350029............ 00.9491 10.79 360051............ 01.4681 19.97 360128............ 01.1129 13.39 360239............ 01.1676 18.44
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[[Page 45878]]
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Avg. Avg. Avg. Avg. Avg.
Provider Case mix hour Provider Case mix hour Provider Case mix hour Provider Case mix hour Provider Case mix hour
index wage index wage index wage index wage index wage
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
360240............ 00.4529 09.64 370085............ 00.7965 12.79 380013............ 01.1950 19.76 390016............ 01.1958 15.75 390098............ 01.7221 19.80
360241............ 00.5971 16.19 370086............ 01.1603 09.31 380014............ 01.3873 18.00 390017............ 01.1833 13.74 390100............ 01.6581 18.56
360242............ 01.6504 ....... 370089............ 01.2840 11.32 380017............ 01.7679 21.74 390018............ 01.1902 18.44 390101............ 01.2352 15.40
360243............ 00.8333 15.66 370091............ 01.6606 15.44 380018............ 01.7785 18.54 390019............ 01.1196 15.02 390102............ 01.3553 19.54
360244............ 00.8182 14.72 370092............ 01.0516 11.97 380019............ 01.1920 17.57 390022............ 01.3562 20.09 390103............ 01.0890 16.83
360245............ 00.8606 14.97 370093............ 01.8102 18.31 380020............ 01.4631 19.42 390023............ 01.2620 20.25 390104............ 01.1238 13.92
360246............ 00.8831 ....... 370094............ 01.3503 16.33 380021............ 01.2003 19.11 390024............ 00.7630 21.76 390106............ 00.9494 16.62
370001............ 01.7432 18.38 370095............ 00.9025 10.78 380022............ 01.1792 17.88 390025............ 00.7561 15.82 390107............ 01.2140 17.78
370002............ 01.2128 13.52 370097............ 01.3556 18.32 380023............ 01.2933 16.49 390026............ 01.2627 20.06 390108............ 01.3539 17.21
370004............ 01.3050 13.98 370099............ 01.1988 13.57 380025............ 01.2496 21.04 390027............ 01.9362 22.10 390109............ 01.1417 13.32
370005............ 01.0163 11.81 370100............ 00.9930 10.79 380026............ 01.3246 16.19 390028............ 01.7661 18.59 390110............ 01.5526 18.76
370006............ 01.1880 14.35 370103............ 00.9353 11.13 380027............ 01.2259 18.77 390029............ 01.7547 17.52 390111............ 01.7889 26.50
370007............ 01.1282 13.12 370105............ 01.9314 16.18 380029............ 01.1923 15.70 390030............ 01.2137 15.42 390112............ 01.2051 12.38
370008............ 01.4032 14.97 370106............ 01.4815 16.09 380031............ 01.0018 14.64 390031............ 01.1392 17.02 390113............ 01.2139 14.98
370011............ 01.0534 13.17 370108............ 01.0799 10.32 380033............ 01.6739 21.91 390032............ 01.2170 17.70 390114............ 01.0997 20.24
370012............ 00.9141 11.46 370112............ 01.0585 11.98 380035............ 01.3441 18.88 390035............ 01.2980 17.23 390115............ 01.3237 20.80
370013............ 01.7263 17.86 370113............ 01.1333 13.21 380036............ 01.0279 16.34 390036............ 01.2563 16.92 390116............ 01.1823 19.21
370014............ 01.2868 17.05 370114............ 01.6294 14.92 380037............ 01.2562 19.57 390037............ 01.2991 17.90 390117............ 01.1278 15.07
370015............ 01.2342 13.90 370121............ 01.2113 13.37 380038............ 01.3261 20.34 390039............ 01.0821 15.36 390118............ 01.2364 15.74
370016............ 01.3725 15.42 370122............ 01.1492 09.31 380039............ 01.2600 20.17 390040............ 00.9405 12.87 390119............ 01.3644 17.02
370017............ 01.1287 10.87 370123............ 01.2248 13.70 380040............ 01.3376 18.06 390041............ 01.2776 17.41 390121............ 01.3191 17.22
370018............ 01.2937 16.87 370125............ 00.9676 11.42 380042............ 01.1747 21.92 390042............ 01.3876 20.08 390122............ 01.0374 15.47
370019............ 01.3530 11.35 370126............ 01.1557 09.48 380047............ 01.6487 19.29 390043............ 01.1087 14.27 390123............ 01.2533 19.42
370020............ 01.3032 11.92 370131............ 00.9570 12.42 380048............ 01.0224 13.14 390044............ 01.5701 18.24 390125............ 01.2123 15.75
370021............ 00.9264 10.11 370133............ 01.0789 09.65 380050............ 01.3167 16.38 390045............ 01.5158 16.69 390126............ 01.2807 20.35
370022............ 01.3140 15.01 370138............ 01.0804 15.13 380051............ 01.5315 18.38 390046............ 01.4888 17.71 390127............ 01.1718 19.86
370023............ 01.3457 14.52 370139............ 00.9646 09.78 380052............ 01.1595 15.90 390047............ 01.6328 22.95 390128............ 01.1729 17.17
370025............ 01.3493 14.57 370140............ 00.9612 11.36 380055............ 01.1802 23.98 390048............ 01.1701 15.25 390130............ 01.1049 17.23
370026............ 01.4655 15.54 370141............ 01.3618 19.76 380056............ 01.0308 15.19 390049............ 01.5133 19.09 390131............ 01.2505 15.35
370028............ 01.8025 17.10 370146............ 01.1923 10.18 380060............ 01.4607 21.21 390050............ 02.0254 20.30 390132............ 01.2306 18.08
370029............ 01.2379 11.52 370148............ 01.4229 17.76 380061............ 01.5092 21.74 390051............ 02.1917 23.77 390133............ 01.7637 20.23
370030............ 01.2303 11.25 370149............ 01.1566 14.18 380062............ 01.1219 13.68 390052............ 01.1552 15.52 390135............ 01.2401 19.41
370032............ 01.4686 14.67 370153............ 01.0837 14.50 380063............ 01.2709 22.15 390054............ 01.1515 13.42 390136............ 01.2190 15.59
370033............ 01.1587 10.89 370154............ 01.0306 12.64 380064............ 01.3409 18.16 390055............ 01.7095 20.40 390137............ 01.1696 17.43
370034............ 01.2251 12.87 370156............ 01.1282 12.99 380065............ 00.9805 17.74 390056............ 01.1719 15.60 390138............ 01.2397 16.41
370035............ 01.5390 14.70 370158............ 01.0248 12.52 380066............ 01.3503 17.09 390057............ 01.2912 18.37 390139............ 01.4632 21.08
370036............ 01.0287 09.08 370159............ 01.3498 13.48 380068............ 01.0131 18.61 390058............ 01.2889 16.75 390142............ 01.6767 21.77
370037............ 01.5897 16.07 370163............ 00.9111 10.33 380069............ 01.1321 17.14 390060............ 01.1142 15.65 390145............ 01.3345 18.30
370038............ 00.9678 10.86 370165............ 01.1694 11.10 380070............ 01.3005 19.47 390061............ 01.5073 20.59 390146............ 01.2340 15.37
370039............ 01.2989 15.91 370166............ 01.1522 16.13 380071............ 01.2980 19.74 390062............ 01.1205 14.75 390147............ 01.2315 18.19
370040............ 01.0664 11.17 370169............ 01.0487 10.14 380072............ 00.9304 14.25 390063............ 01.7188 18.14 390148............ 01.1846 17.53
370041............ 00.9314 13.21 370170............ 00.9331 ....... 380075............ 01.4127 19.35 390064............ 01.5206 15.84 390149............ 01.2472 19.33
370042............ 00.8323 11.93 370171............ 01.0282 ....... 380078............ 01.0299 16.80 390065............ 01.2194 17.97 390150............ 01.1446 17.62
370043............ 01.0171 11.72 370172............ 00.8595 ....... 380081............ 01.1232 16.57 390066............ 01.3031 16.55 390151............ 01.2996 17.35
370045............ 01.0563 10.29 370173............ 01.2978 ....... 380082............ 01.3175 20.54 390067............ 01.7360 18.65 390152............ 01.0265 15.13
370046............ 00.9411 11.89 370174............ 00.6125 ....... 380083............ 01.3362 17.08 390068............ 01.3209 17.00 390153............ 01.1973 21.16
370047............ 01.3164 13.84 370176............ 01.1825 16.22 380084............ 01.2653 18.54 390069............ 01.2822 18.31 390154............ 01.1643 13.88
370048............ 01.1517 12.59 370177............ 00.9262 10.16 380087............ 01.0074 13.59 390070............ 01.3131 19.08 390155............ 01.3050 17.65
370049............ 01.3213 15.14 370178............ 00.9819 10.53 380088............ 00.9674 15.05 390071............ 01.0983 13.09 390156............ 01.3758 21.65
370051............ 00.9489 13.39 370179............ 00.8489 13.14 380089............ 01.2979 20.02 390072............ 01.0753 15.84 390157............ 01.2559 16.75
370054............ 01.2306 14.66 370180............ 00.9753 ....... 380090............ 01.3074 21.62 390073............ 01.5189 17.44 390158............ 01.4547 18.63
370056............ 01.5068 15.57 370183............ 01.2609 12.03 380091............ 01.1984 23.39 390074............ 01.2306 16.29 390159............ 01.2909 19.66
370057............ 01.1350 14.30 370186............ 00.9700 10.36 380897............ 04.7366 ....... 390075............ 01.3391 15.51 390160............ 01.2003 17.44
370059............ 01.1386 12.80 370189............ 01.0967 11.81 390001............ 01.2957 17.00 390076............ 01.2601 20.04 390161............ 01.0387 13.71
370060............ 01.0833 14.13 370190............ 01.5659 16.45 390002............ 01.3114 17.45 390078............ 01.0443 14.92 390162............ 01.3081 19.03
370063............ 01.1256 10.89 370192............ 01.0518 ....... 390003............ 01.2089 16.14 390079............ 01.6752 15.99 390163............ 01.1829 16.45
370064............ 00.9724 09.12 370193............ 01.5813 ....... 390004............ 01.3574 16.37 390080............ 01.2217 17.76 390164............ 01.8500 18.93
370065............ 01.0831 14.46 380001............ 01.2941 18.46 390005............ 01.0234 13.53 390081............ 01.3066 20.10 390166............ 01.1614 16.81
370071............ 01.0248 10.53 380002............ 01.2496 17.64 390006............ 01.7687 17.25 390083............ 01.1851 20.41 390167............ 01.2638 20.38
370072............ 00.9459 11.97 380003............ 01.1800 17.46 390007............ 01.1626 20.95 390084............ 01.2284 14.79 390168............ 01.1943 17.18
370076............ 01.2870 11.71 380004............ 01.6210 22.25 390008............ 01.0940 15.45 390086............ 01.0903 15.51 390169............ 01.2157 17.22
370077............ 01.3610 15.34 380005............ 01.1604 19.10 390009............ 01.6057 17.97 390088............ 01.3463 19.25 390170............ 01.8561 23.09
370078............ 01.6915 14.53 380006............ 01.3742 16.46 390010............ 01.2048 16.98 390090............ 01.7218 19.42 390173............ 01.2147 17.58
370079............ 00.9190 11.99 380007............ 01.6261 20.55 390011............ 01.1973 16.82 390091............ 01.1478 18.41 390174............ 01.7096 23.29
370080............ 00.9794 11.31 380008............ 01.0644 16.93 390012............ 01.2118 18.59 390093............ 01.1830 14.61 390176............ 01.1355 16.28
370082............ 00.9188 10.54 380009............ 01.8099 21.55 390013............ 01.2043 15.89 390095............ 01.1731 14.43 390178............ 01.2800 17.36
370083............ 01.0320 10.95 380010............ 01.1001 19.18 390014............ 01.5661 15.29 390096............ 01.2822 16.50 390179............ 01.2574 20.80
370084............ 01.0538 08.49 380011............ 01.1580 14.12 390015............ 01.1363 12.32 390097............ 01.3255 20.69 390180............ 01.5909 22.45
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Avg. Avg. Avg. Avg. Avg.
Provider Case mix hour Provider Case mix hour Provider Case mix hour Provider Case mix hour Provider Case mix hour
index wage index wage index wage index wage index wage
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
390181............ 01.0567 16.51 400009............ 00.9585 07.08 420018............ 01.6744 17.26 430015............ 01.1953 13.84 440029............ 01.3354 15.62
390183............ 01.1579 17.62 400010............ 00.9770 10.23 420019............ 01.2114 14.47 430016............ 01.7002 17.29 440030............ 01.1477 12.68
390184............ 01.1162 17.14 400011............ 01.0729 06.77 420020............ 01.2550 16.07 430018............ 00.9508 13.20 440031............ 00.9745 11.83
390185............ 01.1728 15.64 400012............ 01.1136 07.24 420022............ 00.9393 15.80 430022............ 00.9341 10.22 440032............ 01.0065 12.50
390186............ 01.1975 12.18 400013............ 01.1634 09.09 420023............ 01.3918 18.61 430023............ 00.9430 09.74 440033............ 01.1147 14.66
390189............ 01.0744 16.34 400014............ 01.4222 07.31 420026............ 01.8511 17.80 430024............ 00.8545 11.51 440034............ 01.4727 17.16
390191............ 01.0451 14.03 400015............ 01.3962 10.35 420027............ 01.3601 14.55 430025............ 00.9418 10.29 440035............ 01.2814 14.81
390192............ 01.1105 16.42 400016............ 01.3551 09.54 420028............ 01.0490 14.33 430026............ 01.0159 10.38 440039............ 01.5604 16.47
390193............ 01.1499 15.76 400017............ 01.1630 06.80 420029............ 01.7205 14.74 430027............ 01.7393 16.35 440040............ 00.9573 11.47
390194............ 01.0783 18.49 400018............ 01.2999 08.93 420030............ 01.2787 17.01 430028............ 01.0746 12.21 440041............ 01.0356 12.55
390195............ 01.8149 21.40 400019............ 01.6166 09.45 420031............ 01.0044 10.97 430029............ 01.0015 12.56 440046............ 01.3480 14.06
390196............ 01.3571 ....... 400021............ 01.3458 07.96 420033............ 01.2457 19.01 430031............ 00.9411 10.95 440047............ 00.9832 12.05
390197............ 01.2759 18.62 400022............ 01.3107 09.75 420035............ 00.8101 11.93 430033............ 01.0803 11.10 440048............ 01.7516 15.85
390198............ 01.2288 14.41 400024............ 00.9882 07.75 420036............ 01.2244 15.01 430034............ 01.0196 10.93 440049............ 01.6359 15.45
390199............ 01.2242 14.46 400026............ 00.9404 07.20 420037............ 01.3233 19.81 430036............ 01.0422 09.44 440050............ 01.2307 13.86
390200............ 01.0074 12.74 400027............ 01.1225 06.87 420038............ 01.2403 14.65 430037............ 00.9525 12.46 440051............ 00.8902 13.44
390201............ 01.2922 18.28 400028............ 01.1413 07.08 420039............ 01.2260 13.96 430038............ 01.0411 10.31 440052............ 01.2700 17.91
390203............ 01.3020 18.63 400029............ 01.1113 07.59 420040............ 01.2120 14.36 430039............ 00.9738 10.63 440053............ 01.2982 16.09
390204............ 01.2596 18.31 400031............ 01.0365 07.37 420042............ 01.1943 13.01 430040............ 00.9048 11.88 440054............ 01.2513 13.93
390205............ 01.2210 22.42 400032............ 01.1747 07.75 420043............ 01.1777 16.87 430041............ 00.9680 11.58 440056............ 01.0740 10.33
390206............ 01.3668 19.80 400044............ 01.1248 09.07 420044............ 01.1942 15.94 430042............ 01.0001 10.28 440057............ 01.0255 10.50
390209............ 01.0381 14.45 400048............ 01.0912 08.01 420048............ 01.1167 13.96 430043............ 01.1190 12.47 440058............ 01.3908 18.36
390211............ 01.2078 16.56 400061............ 01.4735 12.57 420049............ 01.1468 14.52 430044............ 00.9331 12.62 440059............ 01.1604 13.84
390213............ 01.0973 14.10 400079............ 01.2413 09.48 420051............ 01.5754 16.86 430047............ 01.1161 11.03 440060............ 01.1519 13.95
390215............ 01.1567 20.50 400087............ 01.3227 08.37 420053............ 01.0676 14.06 430048............ 01.2139 15.58 440061............ 01.1571 14.49
390217............ 01.2291 17.56 400094............ 01.0188 07.41 420054............ 01.3914 16.63 430049............ 00.9343 11.35 440063............ 01.5537 17.05
390219............ 01.2478 15.84 400098............ 01.2470 07.68 420055............ 01.1239 12.86 430051............ 00.9707 11.88 440064............ 01.1859 15.87
390220............ 01.1967 18.50 400102............ 01.2005 07.47 420056............ 01.0941 13.40 430054............ 00.9389 14.12 440065............ 01.2217 14.09
390222............ 01.2922 19.29 400103............ 01.4900 10.21 420057............ 01.2682 12.58 430056............ 00.8709 08.95 440067............ 01.1662 15.85
390223............ 01.6287 22.05 400104............ 01.2323 09.13 420059............ 00.9558 13.16 430057............ 00.9123 10.35 440068............ 01.1840 16.22
390224............ 00.9142 13.29 400105............ 01.2642 07.81 420061............ 01.2214 15.80 430060............ 00.9948 08.97 440069............ 01.0893 13.34
390225............ 01.2212 15.41 400106............ 01.2411 07.28 420062............ 01.4737 15.07 430062............ 00.8308 10.10 440070............ 01.1199 13.07
390226............ 01.7113 22.03 400109............ 01.5822 08.85 420064............ 01.1420 12.36 430064............ 01.1525 11.35 440071............ 01.4836 15.35
390228............ 01.1936 17.98 400110............ 01.0953 08.90 420065............ 01.3499 16.17 430065............ 01.0287 09.01 440072............ 01.4293 13.45
390231............ 01.3451 20.59 400111............ 01.1494 07.90 420066............ 00.9394 13.87 430066............ 00.9826 10.61 440073............ 01.2767 16.09
390233............ 01.2767 17.67 400112............ 01.2510 07.00 420067............ 01.1965 15.84 430073............ 01.1944 13.35 440078............ 00.9790 12.17
390235............ 01.7664 23.05 400113............ 01.1838 07.07 420068............ 01.2582 15.36 430076............ 00.9618 08.60 440081............ 01.1398 14.51
390236............ 01.1535 16.00 400114............ 01.0673 07.53 420069............ 01.0854 13.87 430077............ 01.5420 15.65 440082............ 01.8991 19.65
390237............ 01.5568 18.82 400115............ 01.0127 08.28 420070............ 01.2534 15.79 430079............ 00.9545 10.60 440083............ 01.1648 10.26
390238............ 01.0894 16.51 400117............ 01.2052 08.75 420071............ 01.3360 15.95 430080............ 00.8917 08.87 440084............ 01.1705 11.11
390242............ 01.3227 18.78 400118............ 01.1427 07.88 420072............ 01.0021 09.92 430081............ 00.9763 ....... 440087............ 00.9796 11.67
390244............ 00.9153 12.37 400120............ 01.2844 08.63 420073............ 01.2975 17.80 430082............ 00.7899 ....... 440090............ 00.9808 13.53
390245............ 01.3582 20.14 400121............ 00.8973 07.05 420074............ 00.9444 09.76 430083............ 00.8400 ....... 440091............ 01.5310 16.83
390246............ 01.1577 15.60 400122............ 00.9790 06.35 420075............ 01.0336 13.97 430084............ 00.8592 ....... 440095............ 01.2178 19.62
390247............ 01.0044 16.83 400123............ 01.1528 08.39 420076............ 01.1230 20.04 430085............ 00.8528 ....... 440100............ 01.0220 12.92
390249............ 00.9992 11.06 400124............ 02.7935 ....... 420078............ 01.7109 18.68 430087............ 00.9462 09.28 440102............ 01.0894 12.32
390256............ 01.6957 20.51 410001............ 01.3181 21.94 420079............ 01.5207 17.23 440001............ 01.1438 11.96 440103............ 01.2356 16.26
390258............ 01.3229 19.30 410004............ 01.3535 20.28 420080............ 01.2176 17.43 440002............ 01.5819 16.12 440104............ 01.5496 17.72
390260............ 01.2454 17.74 410005............ 01.3614 20.46 420081............ 00.7967 18.94 440003............ 01.0982 14.90 440105............ 01.4359 16.93
390262............ 01.9001 17.06 410006............ 01.2126 21.65 420082............ 01.3460 18.34 440006............ 01.4833 16.87 440109............ 01.0518 12.33
390263............ 01.4742 18.55 410007............ 01.6863 19.83 420083............ 01.2177 17.28 440007............ 01.0100 11.40 440110............ 00.9963 14.21
390265............ 01.3075 17.62 410008............ 01.1749 20.30 420084............ 00.9239 12.71 440008............ 01.0294 14.41 440111............ 01.3776 18.41
390266............ 01.1996 15.69 410009............ 01.3416 20.77 420085............ 01.2801 17.16 440009............ 01.1191 12.87 440114............ 01.0168 11.73
390267............ 01.2662 19.03 410010............ 01.0352 24.28 420086............ 01.4018 16.97 440010............ 00.9290 10.52 440115............ 01.0917 13.98
390268............ 01.3883 19.24 410011............ 01.2176 21.48 420087............ 01.6123 15.64 440011............ 01.2479 15.18 440120............ 01.4814 15.84
390270............ 01.3047 16.33 410012............ 01.7204 18.98 420088............ 01.1687 16.05 440012............ 01.4314 16.29 440121............ 01.9731 ......
390272............ 00.5347 20.70 410013............ 01.2564 24.87 420089............ 01.2401 19.72 440014............ 00.9936 10.17 440125............ 01.4135 16.36
390277............ 00.5685 19.80 420002............ 01.3076 20.09 420091............ 01.1896 15.91 440015............ 01.5414 15.38 440130............ 01.1216 13.51
390278............ 00.8123 16.44 420004............ 01.8572 17.72 430004............ 01.0162 14.56 440016............ 00.9709 10.91 440131............ 01.0820 13.17
390279............ 01.1355 ....... 420005............ 01.1291 14.18 430005............ 01.2522 13.79 440017............ 01.5885 17.33 440132............ 01.1216 13.29
390280............ 00.8687 ....... 420006............ 01.3106 15.86 430007............ 01.1290 11.45 440018............ 01.4879 15.33 440133............ 01.5290 17.70
400001............ 01.2171 08.19 420007............ 01.5047 15.99 430008............ 01.1381 13.47 440019............ 01.5921 18.39 440135............ 01.3506 19.68
400002............ 01.4419 10.77 420009............ 01.2531 15.89 430009............ 01.0883 10.81 440020............ 01.2181 16.73 440137............ 00.9636 11.88
400003............ 01.2195 08.34 420010............ 01.0854 13.22 430010............ 01.1134 08.78 440022............ 01.2003 12.79 440141............ 01.1777 12.78
400004............ 01.2103 08.02 420011............ 01.0971 14.00 430011............ 01.3615 14.10 440023............ 01.0157 11.52 440142............ 01.0517 10.83
400005............ 01.0871 06.34 420014............ 01.0714 13.05 430012............ 01.3050 14.13 440024............ 01.3814 16.35 440143............ 01.1010 16.30
400006............ 01.2516 06.86 420015............ 01.3661 16.20 430013............ 01.1996 15.09 440025............ 01.0818 12.19 440144............ 01.2163 17.90
400007............ 01.1884 07.19 420016............ 01.1283 13.46 430014............ 01.2671 16.05 440026............ 00.9153 15.63 440145............ 01.0539 13.40
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[[Page 45880]]
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Avg. Avg. Avg. Avg. Avg.
Provider Case mix hour Provider Case mix hour Provider Case mix hour Provider Case mix hour Provider Case mix hour
index wage index wage index wage index wage index wage
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
440146............ 01.2978 12.03 450051............ 01.5096 18.04 450153............ 01.5438 17.33 450292............ 01.2600 17.64 450465............ 01.1813 11.39
440148............ 01.1549 15.81 450052............ 01.0230 13.39 450154............ 01.1285 10.93 450293............ 01.0277 12.90 450467............ 00.9691 13.77
440149............ 01.2150 15.70 450053............ 01.0703 15.65 450155............ 01.0107 10.09 450296............ 01.3571 16.97 450469............ 01.3473 15.87
440150............ 01.2583 18.75 450054............ 01.7336 21.09 450157............ 01.0311 14.31 450297............ 00.8956 13.66 450473............ 01.0491 15.90
440151............ 01.4156 15.89 450055............ 01.1093 11.71 450160............ 00.9356 17.51 450299............ 01.4096 17.66 450475............ 01.1874 14.99
440152............ 01.6578 17.32 450056............ 01.6499 17.62 450162............ 01.1964 17.13 450303............ 00.9720 10.74 450484............ 01.5173 17.72
440153............ 01.2633 14.46 450058............ 01.5208 14.43 450163............ 01.1423 16.18 450306............ 01.0838 11.84 450488............ 01.2219 19.43
440156............ 01.5231 18.76 450059............ 01.2787 12.62 450164............ 01.1333 12.97 450307............ 00.9772 13.59 450489............ 00.9989 14.86
440157............ 01.0053 13.12 450060............ 01.3766 19.96 450165............ 01.0054 14.05 450309............ 01.0505 11.15 450497............ 01.1598 12.54
440159............ 01.2421 ....... 450063............ 01.0234 11.54 450166............ 00.9211 11.39 450315............ 01.2119 19.84 450498............ 01.1296 13.21
440161............ 01.5951 20.02 450064............ 01.5106 15.53 450169............ 00.8607 14.45 450320............ 01.3603 17.73 450508............ 01.5551 15.68
440166............ 01.4014 17.40 450065............ 01.1189 13.86 450170............ 00.9895 12.30 450321............ 00.9793 10.98 450514............ 01.1878 16.22
440168............ 01.0191 13.32 450068............ 01.7833 17.27 450176............ 01.2578 14.33 450322............ 00.8870 15.26 450517............ 01.0115 11.00
440173............ 01.4900 16.51 450070............ 01.1662 13.40 450177............ 01.1371 12.72 450324............ 01.5522 15.53 450518............ 01.5165 15.17
440174............ 00.9730 14.29 450072............ 01.2259 17.28 450178............ 01.0836 15.65 450325............ 01.1881 09.56 450523............ 01.5622 20.04
440175............ 01.2420 17.24 450073............ 01.1191 10.92 450181............ 00.9133 15.39 450327............ 00.9869 10.00 450530............ 01.2882 19.74
440176............ 01.3017 17.31 450074............ 00.8492 16.51 450184............ 01.5011 19.61 450330............ 01.1758 14.47 450534............ 00.9344 17.01
440178............ 01.2129 18.01 450076............ 01.5227 ....... 450185............ 01.1232 09.25 450334............ 01.0079 11.79 450535............ 01.1966 16.74
440180............ 01.1306 16.13 450078............ 00.9592 10.69 450187............ 01.3348 15.83 450337............ 01.2726 14.42 450537............ 01.3800 18.07
440181............ 01.0368 12.30 450079............ 01.4470 19.51 450188............ 00.9808 12.13 450340............ 01.3364 14.79 450538............ 01.2233 18.62
440182............ 00.9087 14.69 450080............ 01.2576 14.43 450190............ 01.1818 17.82 450341............ 00.9763 16.17 450539............ 01.2718 14.11
440183............ 01.4914 15.92 450081............ 01.0910 12.40 450191............ 01.1079 15.11 450346............ 01.3821 15.86 450544............ 01.4394 19.57
440184............ 01.4104 18.05 450082............ 00.9799 14.21 450192............ 01.0655 15.77 450347............ 01.1385 14.95 450545............ 01.1893 16.75
440185............ 00.9987 17.19 450083............ 01.6927 16.91 450193............ 01.8455 20.78 450348............ 00.9936 10.99 450546............ 01.3009 15.56
440186............ 01.2154 16.59 450085............ 01.1191 13.44 450194............ 01.2628 16.17 450349............ 01.0976 25.54 450547............ 01.1799 13.04
440187............ 01.2318 16.58 450087............ 01.4765 20.99 450195............ 01.1649 17.01 450351............ 01.2378 20.82 450550............ 00.9777 17.28
440189............ 01.4607 16.08 450090............ 01.0814 11.92 450196............ 01.4781 13.63 450352............ 01.1492 15.51 450551............ 01.1352 12.64
440192............ 01.1078 14.00 450092............ 01.3766 12.51 450197............ 01.1513 18.21 450353............ 01.2989 17.12 450558............ 01.7485 18.18
440193............ 01.3105 17.42 450094............ 01.2950 17.42 450200............ 01.4362 15.19 450355............ 01.1550 11.43 450559............ 00.8703 10.67
440194............ 01.3026 17.11 450096............ 01.5012 18.60 450201............ 00.9844 14.55 450358............ 02.0824 19.02 450561............ 01.5458 16.77
440196............ 00.9296 14.68 450097............ 01.4119 17.99 450203............ 01.2264 15.81 450362............ 01.0825 11.91 450563............ 01.2669 21.61
440197............ 01.3620 19.48 450098............ 01.2552 13.96 450209............ 01.5849 16.60 450366............ 01.6443 18.85 450565............ 01.2714 14.73
440200............ 01.2074 16.77 450099............ 01.3037 16.51 450210............ 01.1197 12.40 450369............ 01.1403 10.97 450570............ 01.0643 12.15
440203............ 00.9627 11.16 450101............ 01.4061 14.92 450211............ 01.3930 14.50 450370............ 01.2110 11.99 450571............ 01.4160 14.67
440205............ 01.3025 14.19 450102............ 01.6381 17.29 450213............ 01.5335 15.73 450371............ 01.1823 10.92 450573............ 00.9645 13.22
440206............ 01.0764 13.22 450104............ 01.2372 13.07 450214............ 01.3888 17.29 450372............ 01.3285 22.86 450574............ 00.9827 13.75
450002............ 01.4686 18.34 450107............ 01.5476 18.16 450217............ 01.1331 11.65 450373............ 01.2235 13.96 450575............ 00.9515 14.24
450004............ 01.1281 12.11 450108............ 01.0272 12.16 450219............ 01.1040 13.42 450374............ 00.9039 11.71 450578............ 01.0238 14.27
450005............ 01.0892 14.37 450109............ 01.0396 16.18 450221............ 00.9863 13.35 450376............ 01.4734 14.76 450580............ 01.1179 12.70
450007............ 01.3197 13.04 450110............ 01.2341 14.61 450222............ 01.7067 17.58 450378............ 01.0687 18.25 450583............ 00.9814 12.02
450008............ 01.4103 14.15 450111............ 01.1514 18.57 450224............ 01.3981 15.77 450379............ 01.5572 20.78 450584............ 01.2182 12.25
450010............ 01.3556 14.39 450112............ 01.3449 12.60 450229............ 01.5394 15.30 450381............ 00.9491 12.16 450586............ 01.0168 12.00
450011............ 01.5223 16.73 450113............ 01.2319 14.59 450231............ 01.5327 17.95 450388............ 01.7306 17.23 450587............ 01.2802 15.54
450014............ 01.1081 13.51 450118............ 01.5353 15.96 450234............ 01.0317 11.57 450389............ 01.2099 17.39 450591............ 01.1080 15.20
450015............ 01.6382 14.59 450119............ 01.2988 15.78 450235............ 00.9859 12.40 450393............ 01.2470 21.55 450596............ 01.2924 16.49
450016............ 01.5859 18.64 450121............ 01.5746 18.89 450236............ 01.0705 13.45 450395............ 01.0148 14.21 450597............ 01.0598 15.32
450018............ 01.4858 19.82 450123............ 01.1617 16.60 450237............ 01.5886 15.96 450399............ 01.0278 12.52 450603............ 00.8258 11.74
450020............ 01.0466 14.94 450124............ 01.4856 18.15 450239............ 01.2557 12.21 450400............ 01.1214 13.83 450604............ 01.3711 12.85
450021............ 01.8443 19.58 450126............ 01.3582 16.49 450241............ 00.9480 13.71 450403............ 01.3371 19.91 450605............ 01.2926 18.17
450023............ 01.4041 15.21 450128............ 01.2520 13.45 450243............ 00.8275 11.52 450410............ 00.9614 16.52 450609............ 00.8993 11.00
450024............ 01.3873 14.47 450130............ 01.4833 16.85 450246............ 01.0125 10.82 450411............ 00.9623 11.26 450610............ 01.4896 17.33
450025............ 01.4725 15.12 450131............ 01.3207 17.06 450249............ 01.0282 10.84 450417............ 01.0110 13.74 450614............ 01.0715 12.13
450028............ 01.5375 17.21 450132............ 01.5960 15.46 450250............ 01.0189 12.12 450418............ 01.3733 16.29 450615............ 00.9254 11.97
450029............ 01.4012 11.81 450133............ 01.6059 17.50 450253............ 01.2030 12.54 450419............ 01.2552 20.88 450617............ 01.3368 18.17
450031............ 01.6419 18.78 450135............ 01.7237 19.83 450258............ 01.0849 10.82 450422............ 00.8158 23.68 450620............ 01.0358 13.85
450032............ 01.2840 13.14 450137............ 01.4452 21.51 450259............ 01.2156 17.92 450423............ 01.4053 22.35 450623............ 01.2321 17.54
450033............ 01.5984 16.13 450140............ 01.0268 12.94 450264............ 00.8617 09.77 450424............ 01.2098 16.01 450626............ 01.0232 13.74
450034............ 01.5650 16.34 450142............ 01.4624 19.12 450269............ 01.0790 13.32 450429............ 01.0802 12.22 450628............ 00.8951 11.43
450035............ 01.4950 19.26 450143............ 01.1229 11.76 450270............ 01.1067 10.66 450431............ 01.5647 17.87 450630............ 01.5789 22.91
450037............ 01.5437 16.93 450144............ 01.1095 15.44 450271............ 01.1987 14.76 450438............ 01.1417 13.61 450631............ 01.7397 18.06
450039............ 01.3673 17.94 450145............ 00.8879 12.61 450272............ 01.2222 15.51 450446............ 00.8057 13.57 450632............ 00.9909 10.90
450040............ 01.6012 16.80 450146............ 00.9990 16.15 450276............ 01.1137 11.27 450447............ 01.3466 17.04 450633............ 01.5675 17.65
450042............ 01.6252 15.24 450147............ 01.3675 17.10 450278............ 00.8682 11.11 450450............ 01.1208 13.64 450634............ 01.5775 20.13
450043............ 01.4123 17.52 450148............ 01.2850 18.70 450280............ 01.3411 19.11 450451............ 01.0779 16.31 450637............ 01.3732 17.24
450044............ 01.5738 19.16 450149............ 01.4000 18.97 450283............ 01.0279 13.57 450457............ 01.7418 16.53 450638............ 01.5845 21.91
450046............ 01.3278 16.83 450150............ 00.9221 12.55 450286............ 01.0489 13.54 450460............ 00.9999 11.81 450639............ 01.4385 23.61
450047............ 01.1284 14.89 450151............ 01.1844 12.12 450288............ 01.2387 13.72 450462............ 01.8365 18.04 450641............ 00.9502 11.53
450050............ 00.9784 13.70 450152............ 01.2996 14.41 450289............ 01.4874 16.97 450464............ 01.0067 13.17 450643............ 01.2894 16.86
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Avg. Avg. Avg. Avg. Avg.
Provider Case mix hour Provider Case mix hour Provider Case mix hour Provider Case mix hour Provider Case mix hour
index wage index wage index wage index wage index wage
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
450644............ 01.6088 21.23 450750............ 01.0246 11.13 460041............ 01.2248 18.67 490057............ 01.4890 16.35 500024............ 01.6083 21.17
450646............ 01.5906 18.64 450751............ 01.3272 21.86 460042............ 01.4963 15.69 490059............ 01.5998 17.16 500025............ 01.8684 22.05
450647............ 01.9884 22.49 450754............ 00.9098 11.72 460043............ 01.3741 19.57 490060............ 01.0575 17.44 500026............ 01.4016 21.54
450648............ 01.1125 12.96 450755............ 01.2089 13.35 460044............ 01.1648 18.10 490063............ 01.6367 22.05 500027............ 01.5390 21.51
450649............ 01.0969 12.57 450757............ 00.9885 12.42 460046............ 00.8607 12.57 490066............ 01.2549 17.26 500028............ 01.1284 14.22
450651............ 01.7432 22.45 450758............ 01.8822 20.89 460047............ 01.7937 18.94 490067............ 01.2556 14.34 500029............ 00.9587 12.95
450652............ 00.9632 12.52 450760............ 01.1644 18.92 460049............ 01.9333 15.66 490069............ 01.4348 14.22 500030............ 01.3685 24.00
450653............ 01.1757 16.49 450761............ 01.0223 09.89 460050............ 01.2337 ....... 490071............ 01.4542 17.65 500031............ 01.2640 19.54
450654............ 00.9469 11.33 450763............ 01.0199 15.67 460051............ 01.0445 ....... 490073............ 01.3843 21.85 500033............ 01.2449 17.29
450656............ 01.3727 15.58 450766............ 02.1856 19.39 470001............ 01.1934 17.49 490074............ 01.2589 16.61 500036............ 01.2776 18.39
450658............ 00.9981 10.98 450769............ 00.9727 12.82 470003............ 01.9247 17.39 490075............ 01.2964 16.02 500037............ 01.1897 17.16
450659............ 01.4943 19.28 450770............ 01.0467 12.94 470004............ 01.0722 14.19 490077............ 01.2149 17.00 500039............ 01.3377 19.49
450660............ 01.5981 20.17 450771............ 02.0587 18.83 470005............ 01.2108 18.33 490079............ 01.2757 14.03 500041............ 01.2747 21.21
450661............ 01.3065 18.06 450774............ 00.7538 21.30 470006............ 01.2015 18.12 490083............ 00.7547 13.47 500042............ 01.3098 20.40
450662............ 01.5933 16.63 450775............ 01.2005 17.45 470008............ 01.2928 16.29 490084............ 01.2941 16.33 500043............ 01.1372 16.16
450665............ 00.9971 11.26 450776............ 00.9537 10.12 470010............ 01.1493 17.20 490085............ 01.1576 12.49 500044............ 01.8736 19.89
450666............ 01.2396 17.31 450777............ 01.0057 14.24 470011............ 01.1925 18.92 490088............ 01.1847 14.26 500045............ 01.1212 18.22
450668............ 01.5522 18.60 450778............ 01.0640 15.29 470012............ 01.2697 15.64 490089............ 01.1042 14.82 500048............ 00.9117 15.45
450669............ 01.2481 19.18 450779............ 01.3064 21.26 470013............ 01.1390 18.59 490090............ 01.2200 13.95 500049............ 01.4899 16.56
450670............ 01.2784 16.66 450780............ 00.9836 22.14 470015............ 01.1457 16.60 490091............ 01.2392 21.12 500050............ 01.4060 19.25
450672............ 01.6395 19.60 450781............ 01.3563 17.80 470018............ 01.1609 17.36 490092............ 01.1705 14.20 500051............ 01.5384 21.26
450673............ 01.0761 11.01 450785............ 00.9009 ....... 470020............ 00.9563 13.25 490093............ 01.2825 13.84 500052............ 01.2712 ......
450674............ 00.8953 21.14 450787............ 01.6643 ....... 470023............ 01.2131 16.94 490094............ 01.1699 14.92 500053............ 01.2515 18.75
450675............ 01.4186 18.92 450788............ 01.3734 ....... 470024............ 01.1176 17.30 490095............ 01.3280 15.08 500054............ 01.8258 19.36
450677............ 01.4547 17.98 450789............ 01.5166 ....... 490001............ 01.0841 18.15 490097............ 01.1514 13.16 500055............ 01.0515 19.51
450678............ 01.6001 20.58 450790............ 01.4639 ....... 490002............ 01.1122 13.81 490098............ 01.3214 11.28 500057............ 01.3245 15.53
450681............ 01.6741 16.31 450791............ 01.3605 ....... 490003............ 00.6435 17.00 490099............ 00.9238 14.45 500058............ 01.4327 18.94
450683............ 01.2986 18.99 450792............ 02.0245 ....... 490004............ 01.1979 16.16 490100............ 01.3493 15.30 500059............ 01.1171 19.10
450684............ 01.2701 19.08 450793............ 01.7205 ....... 490005............ 01.5122 15.84 490101............ 01.1264 22.88 500060............ 01.4666 20.13
450686............ 01.4767 14.11 450794............ 01.5005 ....... 490006............ 01.1536 11.33 490104............ 00.8991 13.15 500061............ 01.0210 18.41
450688............ 01.3862 18.04 450795............ 00.7983 ....... 490007............ 02.0030 16.84 490105............ 00.7117 14.49 500062............ 01.1748 16.66
450690............ 01.4546 20.68 450797............ 00.8211 ....... 490009............ 01.7149 17.43 490106............ 00.8530 14.71 500064............ 01.4821 20.82
450691............ 01.1341 17.17 450798............ 00.6737 ....... 490010............ 01.1081 16.48 490107............ 01.2127 21.41 500065............ 01.3304 16.86
450694............ 01.3398 18.17 450799............ 01.7205 ....... 490011............ 01.3387 16.63 490108............ 00.8585 ....... 500068............ 00.9814 17.47
450696............ 01.4552 25.42 450897............ 04.9398 ....... 490012............ 01.1697 15.28 490109............ 00.9591 15.20 500069............ 01.1385 17.48
450697............ 01.4442 16.21 460001............ 01.7298 18.59 490013............ 01.1924 14.26 490110............ 01.2966 17.10 500071............ 01.2496 18.61
450698............ 00.9526 11.08 460003............ 01.5949 18.81 490014............ 01.4385 20.38 490111............ 01.2268 15.12 500072............ 01.2221 20.50
450700............ 00.9540 12.44 460004............ 01.7192 19.08 490015............ 01.4857 15.02 490112............ 01.6762 18.77 500073............ 01.0568 15.12
450702............ 01.5786 18.31 460005............ 01.5937 17.62 490017............ 01.3020 16.09 490113............ 01.3532 20.37 500074............ 01.0883 14.41
450703............ 01.5413 19.25 460006............ 01.3874 17.64 490018............ 01.2041 16.62 490114............ 01.1088 14.33 500075............ 01.2828 19.27
450704............ 01.2670 17.67 460007............ 01.3090 17.38 490019............ 01.2498 14.91 490115............ 01.2261 13.65 500077............ 01.3492 20.78
450705............ 01.0180 17.17 460008............ 01.4032 17.62 490020............ 01.1735 14.05 490116............ 01.2469 15.71 500079............ 01.3578 19.43
450706............ 01.2046 20.86 460009............ 01.6060 18.12 490021............ 01.3480 16.28 490117............ 01.1112 12.95 500080............ 00.8344 11.39
450709............ 01.1943 20.28 460010............ 02.0221 18.98 490022............ 01.2783 17.26 490118............ 01.7075 20.83 500084............ 01.2294 20.02
450711............ 01.6186 17.54 460011............ 01.4052 15.54 490023............ 01.2035 16.32 490119............ 01.2866 15.88 500085............ 01.0260 16.17
450712............ 00.8013 13.61 460013............ 01.4857 17.85 490024............ 01.6911 16.18 490120............ 01.3466 15.75 500086............ 01.3689 17.97
450713............ 01.4662 18.26 460014............ 01.0888 13.89 490027............ 01.1650 12.79 490122............ 01.2872 20.90 500088............ 01.3266 22.26
450715............ 01.4731 18.76 460015............ 01.2749 18.76 490028............ 01.3394 18.38 490123............ 01.1430 14.54 500089............ 01.0004 13.34
450716............ 01.2218 19.00 460016............ 00.9499 11.00 490030............ 01.2407 11.35 490124............ 01.1661 15.26 500090............ 00.7866 11.74
450717............ 01.2784 21.01 460017............ 01.4383 17.16 490031............ 01.1795 12.64 490126............ 01.2848 14.21 500092............ 01.0572 15.00
450718............ 01.2203 18.08 460018............ 00.9576 12.68 490032............ 01.7158 17.92 490127............ 01.0520 14.36 500094............ 00.9085 14.32
450723............ 01.3063 18.47 460019............ 01.0413 12.47 490033............ 01.1833 14.44 490130............ 01.2888 15.51 500096............ 00.9781 17.15
450724............ 01.2219 15.86 460020............ 01.0260 13.72 490035............ 01.0368 ....... 490131............ 00.9910 14.07 500097............ 01.2091 15.19
450725............ 01.1353 17.82 460021............ 01.3642 18.22 490037............ 01.1718 12.63 500001............ 01.3060 20.75 500098............ 00.9354 13.14
450726............ 00.8698 13.38 460022............ 00.9921 18.32 490038............ 01.1871 12.51 500002............ 01.4361 17.37 500101............ 00.9677 15.87
450727............ 00.9143 11.28 460023............ 01.1554 19.51 490040............ 01.3958 20.53 500003............ 01.3129 19.31 500102............ 00.9781 17.18
450728............ 00.9353 11.43 460024............ 01.0223 13.10 490041............ 01.2628 17.07 500005............ 01.7732 21.79 500104............ 01.2642 19.06
450730............ 01.3395 20.38 460025............ 00.7899 13.76 490042............ 01.3552 14.57 500007............ 01.3550 19.61 500106............ 00.9461 14.69
450732............ 01.3497 18.21 460026............ 01.0403 16.26 490043............ 01.2576 19.59 500008............ 01.8774 22.18 500107............ 01.1150 14.46
450733............ 01.3875 18.33 460027............ 00.9741 17.65 490044............ 01.3074 16.12 500009............ 01.3107 20.51 500108............ 01.6565 21.71
450734............ 01.3020 16.26 460029............ 01.1357 14.92 490045............ 01.1758 18.21 500011............ 01.3536 22.04 500110............ 01.2379 17.96
450735............ 00.9322 11.77 460030............ 01.2052 15.88 490046............ 01.4569 16.95 500012............ 01.5160 19.95 500118............ 01.1807 19.87
450742............ 01.2757 19.64 460032............ 00.9608 14.10 490047............ 01.0538 17.13 500014............ 01.8057 22.08 500119............ 01.3366 19.61
450743............ 01.3731 20.69 460033............ 00.9525 16.93 490048............ 01.4629 16.87 500015............ 01.3083 19.91 500122............ 01.2713 18.49
450745............ 00.7868 20.44 460035............ 00.8922 12.40 490050............ 01.3959 20.10 500016............ 01.3773 21.55 500123............ 01.0450 15.07
450746............ 01.0246 12.27 460036............ 00.9189 18.64 490052............ 01.5704 14.59 500019............ 01.2746 19.53 500124............ 01.3300 21.30
450747............ 01.4159 14.21 460037............ 01.0249 13.35 490053............ 01.2549 13.56 500021............ 01.5192 19.18 500125............ 01.0634 10.72
450749............ 01.0392 12.03 460039............ 00.9759 19.55 490054............ 01.0939 13.83 500023............ 01.2135 19.80 500127............ 00.7012 14.81
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
[[Page 45882]]
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------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Avg. Avg. Avg. Avg. Avg.
Provider Case mix hour Provider Case mix hour Provider Case mix hour Provider Case mix hour Provider Case mix hour
index wage index wage index wage index wage index wage
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
500129............ 01.6435 20.99 520003............ 01.1019 14.95 520092............ 01.1009 15.89 530012............ 01.5259 15.96
500132............ 00.9823 18.61 520004............ 01.1977 15.96 520094............ 01.0671 15.88 530014............ 01.2904 14.52
500134............ 00.8256 15.48 520006............ 01.0303 17.00 520095............ 01.3481 17.75 530015............ 01.1431 18.14
500137............ 00.6497 17.85 520007............ 01.0705 13.40 520096............ 01.5431 16.65 530016............ 01.1199 11.30
500138............ 05.5857 ....... 520008............ 01.5038 20.21 520097............ 01.3461 16.82 530017............ 01.0566 15.09
500139............ 01.4518 21.47 520009............ 01.6685 16.69 520098............ 01.8261 19.03 530018............ 01.0261 13.70
500140............ 00.9789 13.96 520010............ 01.1333 18.74 520100............ 01.2401 15.22 530019............ 00.9964 12.98
500141............ 01.3370 20.95 520011............ 01.1787 15.82 520101............ 01.1171 15.24 530022............ 01.0572 15.34
500143............ 00.8363 14.99 520013............ 01.3440 17.39 520102............ 01.2258 18.37 530023............ 00.8340 16.19
500145............ 01.8903 ....... 520014............ 01.1833 14.92 520103............ 01.3072 16.55 530025............ 01.3592 17.07
500898............ 01.1447 ....... 520015............ 01.1939 16.10 520107............ 01.2720 15.90 530026............ 01.0587 13.67
510001............ 01.6943 16.64 520016............ 01.0266 12.10 520109............ 01.0103 16.79 530027............ 00.8666 08.89
510002............ 01.2607 17.53 520017............ 01.2182 16.17 520110............ 01.1029 16.26 530029............ 00.8700 13.80
510004............ 00.9418 11.47 520018............ 00.9654 15.12 520111............ 01.0740 13.12 530031............ 00.8812 12.07
510005............ 00.9081 12.40 520019............ 01.3228 15.81 520112............ 01.1233 17.91 530032............ 01.1554 16.45
510006............ 01.2424 17.07 520021............ 01.3295 17.87 520113............ 01.1931 17.45
510007............ 01.4216 16.92 520024............ 01.0301 12.06 520114............ 01.0922 12.56
510008............ 01.0998 14.78 520025............ 01.0787 14.84 520115............ 01.2924 15.40
510009............ 01.0048 12.02 520026............ 01.0610 16.62 520116............ 01.2584 16.86
510012............ 01.0531 14.30 520027............ 01.1488 18.20 520117............ 01.0564 14.29
510013............ 01.1930 14.68 520028............ 01.3486 16.60 520118............ 00.9485 09.62
510015............ 00.9510 13.86 520029............ 00.9455 15.32 520120............ 00.9830 11.97
510016............ 01.0213 11.19 520030............ 01.6743 18.99 520121............ 00.9330 13.81
510018............ 01.0890 12.75 520031............ 01.1703 16.00 520122............ 01.0095 13.21
510020............ 01.0922 09.36 520032............ 01.1521 14.19 520123............ 01.0554 15.20
510022............ 01.7054 18.97 520033............ 01.1822 15.92 520124............ 01.1511 14.50
510023............ 01.1019 15.21 520034............ 01.1919 16.24 520130............ 01.0949 12.36
510024............ 01.3533 16.56 520035............ 01.2474 14.95 520131............ 01.0242 15.72
510025............ 00.9456 10.06 520037............ 01.5852 17.92 520132............ 01.1825 13.60
510026............ 00.9312 11.40 520038............ 01.3793 16.35 520134............ 01.0935 14.40
510027............ 00.9817 13.01 520039............ 01.0054 15.55 520135............ 01.0064 12.70
510028............ 01.0630 18.75 520040............ 01.4619 19.00 520136............ 01.5225 18.05
510029............ 01.2924 15.75 520041............ 01.1965 14.44 520138............ 01.8502 17.66
510030............ 01.0608 14.71 520042............ 01.0497 15.99 520139............ 01.2028 17.83
510031............ 01.3136 15.41 520044............ 01.3539 15.83 520140............ 01.5559 18.24
510033............ 01.2401 13.81 520045............ 01.6488 16.87 520141............ 01.1553 15.56
510035............ 01.1549 17.54 520047............ 01.0317 14.12 520142............ 00.8153 11.71
510036............ 00.9330 11.78 520048............ 01.4308 16.96 520144............ 01.0173 15.72
510038............ 01.0459 13.86 520049............ 01.8222 17.11 520145............ 00.9640 16.59
510039............ 01.3509 14.77 520051............ 01.9233 18.64 520146............ 01.0787 12.88
510043............ 00.9749 10.23 520053............ 01.0459 14.95 520148............ 01.1487 14.99
510046............ 01.2071 15.27 520054............ 01.0481 15.66 520149............ 00.9606 12.29
510047............ 01.1461 16.64 520056............ 01.2856 17.61 520151............ 01.0828 13.81
510048............ 01.1064 17.03 520057............ 01.1572 15.81 520152............ 01.1492 15.57
510050............ 01.3072 14.07 520058............ 01.0289 17.40 520153............ 00.9151 12.42
510053............ 00.9862 13.43 520059............ 01.2817 17.27 520154............ 01.1233 15.66
510055............ 01.2700 18.38 520060............ 01.3379 14.70 520156............ 01.0988 17.35
510058............ 01.2284 15.23 520062............ 01.2446 15.60 520157............ 01.0073 13.06
510059............ 01.0508 13.61 520063............ 01.1934 16.74 520159............ 00.8912 15.84
510060............ 01.1108 13.44 520064............ 01.6924 17.58 520160............ 01.7825 16.98
510061............ 01.0267 13.23 520066............ 01.3684 17.75 520161............ 01.0499 14.34
510062............ 01.2044 15.84 520068............ 00.9064 14.65 520170............ 01.3136 17.27
510063............ 01.0554 13.39 520069............ 01.2244 15.89 520171............ 00.9780 13.38
510065............ 00.9964 18.80 520070............ 01.4628 16.29 520173............ 01.2002 17.49
510066............ 01.1021 11.29 520071............ 01.1162 16.28 520174............ 01.4623 19.90
510067............ 01.2260 16.60 520074............ 01.1022 14.80 520177............ 01.5389 19.26
510068............ 01.1324 14.26 520075............ 01.4723 16.74 520178............ 01.0619 13.83
510070............ 01.1945 15.60 520076............ 01.0948 14.67 520186............ 02.1412 .......
510071............ 01.2602 14.58 520077............ 01.0475 13.87 530002............ 01.1018 16.35
510072............ 01.0953 12.86 520078............ 01.4727 16.04 530003............ 00.8823 12.54
510077............ 01.1439 13.21 520082............ 01.4075 15.87 530004............ 01.0189 12.81
510080............ 01.1711 10.11 520083............ 01.6393 20.44 530005............ 01.0032 11.90
510081............ 00.9772 12.88 520084............ 01.1026 14.57 530006............ 01.1623 16.90
510082............ 01.1301 11.32 520087............ 01.6097 16.33 530007............ 01.0744 11.30
510084............ 00.9945 12.23 520088............ 01.2813 16.17 530008............ 01.2067 16.29
510085............ 01.2462 17.51 520089............ 01.5211 18.22 530009............ 01.0242 15.00
510086............ 01.1086 14.08 520090............ 01.2264 15.59 530010............ 01.2322 16.82
520002............ 01.2769 16.70 520091............ 01.2702 16.49 530011............ 01.0511 15.86
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Note: Case mix indexes do not include discharges from PPS-Exempt Units. Case mix indexes include cases received in HCFA Central Office through June 1995.
BILLING CODE 4120-01-P
[[Page 45883]]
Table 4a.--Wage Index and Capital Geographic Adjustment Factor (GAF) for
Urban Areas
------------------------------------------------------------------------
Urban area (constituent counties or county Wage
equivalents) index GAF
------------------------------------------------------------------------
0040 Abilene, TX................................... 0.8546 0.8980
Taylor, TX
0060 Aguadilla, PR................................. 0.4744 0.6001
Aguada, PR
Aguadilla, PR
Moca, PR
0080 Akron, OH..................................... 0.9578 0.9709
Portage, OH
Summit, OH
0120 Albany, GA.................................... 0.8608 0.9024
Dougherty, GA
Lee, GA
0160 Albany-Schenectady-Troy, NY................... 0.8818 0.9175
Albany, NY
Montgomery, NY
Rensselaer, NY
Saratoga, NY
Schenectady, NY
Schoharie, NY
0200 Albuquerque, NM............................... 0.9542 0.9684
Bernalillo, NM
Sandoval, NM
Valencia, NM
0220 Alexandria, LA................................ 0.8010 0.8590
Rapides, LA
0240 Allentown-Bethlehem-Easton, PA................ 1.0198 1.0135
Carbon, PA
Lehigh, PA
Northampton, PA
0280 Altoona, PA................................... 0.9007 0.9309
Blair, PA
0320 Amarillo, TX.................................. 0.8759 0.9133
Potter, TX
Randall, TX
0380 Anchorage, AK................................. 1.3373 1.2202
Anchorage, AK
0440 Ann Arbor, MI................................. 1.2116 1.1405
Lenawee, MI
Livingston, MI
Washtenaw, MI
0450 Anniston, AL.................................. 0.8158 0.8699
Calhoun, AL
0460 Appleton-Oshkosh-Neenah, WI................... 0.8844 0.9193
Calumet, WI
Outagamie, WI
Winnebago, WI
0470 Arecibo, PR................................... 0.4498 0.5786
Arecibo, PR
Camuy, PR
Hatillo, PR
0480 Asheville, NC................................. 0.9218 0.9458
Buncombe, NC
Madison, NC
0500 Athens, GA.................................... 0.9097 0.9372
Clarke, GA
Madison, GA
Oconee, GA
0520 *Atlanta, GA.................................. 1.0069 1.0047
Barrow, GA
Bartow, GA
Carroll, GA
Cherokee, GA
Clayton, GA
Cobb, GA
Coweta, GA
De Kalb, GA
Douglas, GA
Fayette, GA
Forsyth, GA
Fulton, GA
Gwinnett, GA
Henry, GA
Newton, GA
Paulding, GA
Pickens, GA
Rockdale, GA
Spalding, GA
Walton, GA
0560 Atlantic City-Cape May, NJ.................... 1.0935 1.0631
Atlantic City, NJ
Cape May, NJ
0600 Augusta-Aiken, GA-SC.......................... 0.8955 0.9272
Columbia, GA
McDuffie, GA
Richmond, GA
Aiken, SC
Edgefield, SC
0640 Austin-San Marcos, TX......................... 0.9255 0.9484
Bastrop, TX
Caldwell, TX
Hays, TX
Travis, TX
Williamson, TX
0680 Bakersfield, CA............................... 1.0502 1.0341
Kern, CA
0720 *Baltimore, MD................................ 0.9866 0.9908
Anne Arundel, MD
Baltimore, MD
Baltimore City, MD
Carroll, MD
Harford, MD
Howard, MD
Queen Annes, MD
0733 Bangor, ME.................................... 0.9360 0.9557
Penobscot, ME
0743 Barnstable-Yarmouth, MA....................... 1.3457 1.2255
Barnstable, MA
0760 Baton Rouge, LA............................... 0.8670 0.9069
Ascension, LA
East Baton Rouge, LA
Livingston, LA
West Baton Rouge, LA
0840 Beaumont-Port Arthur, TX...................... 0.8603 0.9021
Hardin, TX
Jefferson, TX
Orange, TX
0860 Bellingham, WA................................ 1.2681 1.1766
Whatcom, WA
0870 Benton Harbor, MI............................. 0.8304 0.8805
Berrien, MI
0875 *Bergen-Passaic, NJ........................... 1.1474 1.0987
Bergen, NJ
Passaic, NJ
0880 Billings, MT.................................. 0.8705 0.9094
Yellowstone, MT
0920 Biloxi-Gulfport-Pascagoula, MS................ 0.8448 0.8909
Hancock, MS
Harrison, MS
Jackson, MS
0960 Binghamton, NY................................ 0.9005 0.9307
Broome, NY
Tioga, NY
1000 Birmingham, AL................................ 0.9144 0.9406
Blount, AL
Jefferson, AL
St. Clair, AL
Shelby, AL
1010 Bismarck, ND.................................. 0.8299 0.8801
Burleigh, ND
Morton, ND
1020 Bloomington, IN............................... 0.8429 0.8896
Monroe, IN
1040 Bloomington-Normal, IL........................ 0.8740 0.9119
McLean, IL
1080 Boise City, ID................................ 0.9150 0.9410
Ada, ID
Canyon, ID
1123 *Boston-Brockton-Nashua, MA-NH................ 1.1685 1.1125
Bristol, MA
Essex, MA
Middlesex, MA
Norfolk, MA
Plymouth, MA
Suffolk, MA
Worcester, MA
Hillsborough, NH
Merrimack, NH
Rockingham, NH
Strafford, NH
1125 Boulder-Longmont, CO.......................... 0.9780 0.9849
Boulder, CO
1145 Brazoria, TX.................................. 0.8584 0.9007
Brazoria, TX
1150 Bremerton, WA................................. 1.0295 1.0201
Kitsap, WA
1240 Brownsville-Harlingen-San Benito, TX.......... 0.8650 0.9055
Cameron, TX
1260 Bryan-College Station, TX..................... 0.8987 0.9295
Brazos, TX
1280 *Buffalo-Niagara Falls, NY.................... 0.9186 0.9435
Erie, NY
Niagara, NY
1303 Burlington, VT................................ 0.9252 0.9482
Chittenden, VT
Franklin, VT
Grand Isle, VT
1310 Caguas, PR.................................... 0.4706 0.5968
Caguas, PR
Cayey, PR
Cidra, PR
Gurabo, PR
San Lorenzo, PR
[[Page 45884]]
1320 Canton-Massillon, OH.......................... 0.8749 0.9125
Carroll, OH
Stark, OH
1350 Casper, WY.................................... 0.8662 0.9063
Natrona, WY
1360 Cedar Rapids, IA.............................. 0.8359 0.8845
Linn, IA
1400 Champaign-Urbana, IL.......................... 0.8867 0.9210
Champaign, IL
1440 Charleston-North Charleston, SC............... 0.8930 0.9254
Berkeley, SC
Charleston, SC
Dorchester, SC
1480 Charleston, WV................................ 0.9498 0.9653
Kanawha, WV
Putnam, WV
1520 *Charlotte-Gastonia-Rock Hill, NC-SC.......... 0.9668 0.9771
Cabarrus, NC
Gaston, NC
Lincoln, NC
Mecklenburg, NC
Rowan, NC
Union, NC
York, SC
1540 Charlottesville, VA........................... 0.9179 0.9430
Albemarle, VA
Charlottesville City, VA
Fluvanna, VA
Greene, VA
1560 Chattanooga, TN-GA............................ 0.9129 0.9395
Catoosa, GA
Dade, GA
Walker, GA
Hamilton, TN
Marion, TN
1580 Cheyenne, WY.................................. 0.7935 0.8535
Laramie, WY
1600 *Chicago, IL.................................. 1.0632 1.0429
Cook, IL
De Kalb, IL
Du Page, IL
Grundy, IL
Kane, IL
Kendall, IL
Lake, IL
McHenry, IL
Will, IL
1620 Chico-Paradise, CA............................ 1.0531 1.0361
Butte, CA
1640 *Cincinnati, OH-KY-IN......................... 0.9418 0.9598
Dearborn, IN
Ohio, IN
Boone, KY
Campbell, KY
Gallatin, KY
Grant, KY
Kenton, KY
Pendleton, KY
Brown, OH
Clermont, OH
Hamilton, OH
Warren, OH
1660 Clarksville-Hopkinsville, TN-KY............... 0.7542 0.8243
Christian, KY
Montgomery, TN
1680 *Cleveland-Lorain-Elyria, OH.................. 0.9835 0.9887
Ashtabula, OH
Cuyahoga, OH
Geauga, OH
Lake, OH
Lorain, OH
Medina, OH
1720 Colorado Springs, CO.......................... 0.9294 0.9511
El Paso, CO
1740 Columbia, MO.................................. 0.9461 0.9628
Boone, MO
1760 Columbia, SC.................................. 0.9033 0.9327
Lexington, SC
Richland, SC
1800 Columbus, GA-AL............................... 0.7756 0.8403
Russell, AL
Chattanoochee, GA
Harris, GA
Muscogee, GA
1840 *Columbus, OH................................. 0.9734 0.9817
Delaware, OH
Fairfield, OH
Franklin, OH
Licking, OH
Madison, OH
Pickaway, OH
1880 Corpus Christi, TX............................ 0.8941 0.9262
Nueces, TX
San Patricio, TX
1900 Cumberland, MD-WV............................. 0.8372 0.8854
Allegany, MD
Mineral, WV
1920 *Dallas, TX................................... 0.9804 0.9865
Collin, TX
Dallas, TX
Denton, TX
Ellis, TX
Henderson, TX
Hunt, TX
Kaufman, TX
Rockwall, TX
1950 Danville, VA.................................. 0.8465 0.8922
Danville City, VA
Pittsylvania, VA
1960 Davenport-Rock Island-Moline, IA-IL........... 0.8347 0.8836
Scott, IA
Henry, IL
Rock Island, IL
2000 Dayton-Springfield, OH........................ 0.9428 0.9605
Clark, OH
Greene, OH
Miami, OH
Montgomery, OH
2020 Daytona Beach, FL............................. 0.8902 0.9234
Flagler, FL
Volusia, FL
2030 Decatur, AL................................... 0.8180 0.8715
Lawrence, AL
Morgan, AL
2040 Decatur, IL................................... 0.7790 0.8428
Macon, IL
2080 *Denver, CO................................... 1.0447 1.0304
Adams, CO
Arapahoe, CO
Denver, CO
Douglas, CO
Jefferson, CO
2120 Des Moines, IA................................ 0.8792 0.9156
Dallas, IA
Polk, IA
Warren, IA
2160 *Detroit, MI.................................. 1.0834 1.0564
Lapeer, MI
Macomb, MI
Monroe, MI
Oakland, MI
St. Clair, MI
Wayne, MI
2180 Dothan, AL.................................... 0.7751 0.8399
Dale, AL
Houston, AL
2190 Dover, DE..................................... 0.8960 0.9276
Kent, DE
2200 Dubuque, IA................................... 0.8054 0.8623
Dubuque, IA
2240 Duluth-Superior, MN-WI........................ 0.9660 0.9766
St. Louis, MN
Douglas, WI
2281 Dutchess County, NY........................... 1.0697 1.0472
Dutchess, NY
2290 Eau Claire, WI................................ 0.8660 0.9062
Chippewa, WI
Eau Claire, WI
2320 El Paso, TX................................... 0.9266 0.9491
El Paso, TX
2330 Elkhart-Goshen, IN............................ 0.8806 0.9166
Elkhart, IN
2335 Elmira, NY.................................... 0.8460 0.8918
Chemung, NY
2340 Enid, OK...................................... 0.8170 0.8707
Garfield, OK
2360 Erie, PA...................................... 0.9196 0.9442
Erie, PA
2400 Eugene-Springfield, OR........................ 1.1184 1.0796
Lane, OR
2440 Evansville-Henderson, IN-KY................... 0.8899 0.9232
Posey, IN
Vanderburgh, IN
Warrick, IN
Henderson, KY
2520 Fargo-Moorhead, ND-MN......................... 0.8912 0.9242
Clay, MN
[[Page 45885]]
Cass, ND
2560 Fayetteville, NC.............................. 0.8843 0.9192
Cumberland, NC
2580 Fayetteville-Springdale-Rogers, AR............ 0.7090 0.7902
Benton, AR
Washington, AR
2620 Flagstaff, AZ-UT.............................. 0.8619 0.9032
Coconino, AZ
Kane, UT
2640 Flint, MI..................................... 1.0738 1.0500
Genesee, MI
2650 Florence, AL.................................. 0.7970 0.8561
Colbert, AL
Lauderdale, AL
2655 Florence, SC.................................. 0.8537 0.8973
Florence, SC
2670 Fort Collins-Loveland, CO..................... 1.0595 1.0404
Larimer, CO
2680 *Ft. Lauderdale, FL........................... 1.0952 1.0643
Broward, FL
2700 Fort Myers-Cape Coral, FL..................... 0.9666 0.9770
Lee, FL
2710 Fort Pierce-Port St. Lucie, FL................ 1.0401 1.0273
Martin, FL
St. Lucie, FL
2720 Fort Smith, AR-OK............................. 0.7608 0.8293
Crawford, AR
Sebastian, AR
Sequoyah, OK
2750 Fort Walton Beach, FL......................... 0.8705 0.9094
Okaloosa, FL
2760 Fort Wayne, IN................................ 0.8691 0.9084
Adams, IN
Allen, IN
De Kalb, IN
Huntington, IN
Wells, IN
Whitley, IN
2800 *Forth Worth-Arlington, TX.................... 1.0052 1.0036
Hood, TX
Johnson, TX
Parker, TX
Tarrant, TX
2840 Fresno, CA.................................... 1.0522 1.0355
Fresno, CA
Madera, CA
2880 Gadsden, AL................................... 0.8568 0.8996
Etowah, AL
2900 Gainesville, FL............................... 0.9007 0.9309
Alachua, FL
2920 Galveston-Texas City, TX...................... 1.0304 1.0207
Galveston, TX
2960 Gary, IN...................................... 0.9452 0.9621
Lake, IN
Porter, IN
2975 Glens Falls, NY............................... 0.9276 0.9498
Warren, NY
Washington, NY
2980 Goldsboro, NC................................. 0.8165 0.8704
Wayne, NC
2985 Grand Forks, ND-MN............................ 0.8983 0.9292
Polk, MN
Grand Forks, ND
2995 Grand Junction, CO............................ 0.7988 0.8574
Mesa, CO
3000 Grand Rapids-Muskegon-Holland, MI............. 1.0055 1.0038
Allegan, MI
Kent, MI
Muskegon, MI
Ottawa, MI
3040 Great Falls, MT............................... 0.9039 0.9331
Cascade, MT
3060 Greeley, CO................................... 0.9146 0.9407
Weld, CO
3080 Green Bay, WI................................. 0.9190 0.9438
Brown, WI
3120 *Greensboro-Winston-Salem-High................
Point, NC 0.9160 0.9417
Alamance, NC
Davidson, NC
Davie, NC
Forsyth, NC
Guilford, NC
Randolph, NC
Stokes, NC
Yadkin, NC
3150 Greenville, NC................................ 0.9102 0.9376
Pitt, NC
3160 Greenville-Spartanburg-Anderson, SC........... 0.9047 0.9337
Anderson, SC
Cherokee, SC
Greenville, SC
Pickens, SC
Spartanburg, SC
3180 Hagerstown, MD................................ 0.9074 0.9356
Washington, MD
3200 Hamilton-Middletown, OH....................... 0.8782 0.9149
Butler, OH
3240 Harrisburg-Lebanon-Carlisle, PA............... 0.9972 0.9981
Cumberland, PA
Dauphin, PA
Lebanon, PA
Perry, PA
3283 *Hartford, CT................................. 1.2391 1.1581
Hartford, CT
Litchfield, CT
Middlesex, CT
Tolland, CT
3285 Hattiesburg, MS............................... 0.7245 0.8020
Forrest, MS
Lamar, MS
3290 Hickory-Morganton-Lenoir, NC.................. 0.7983 0.8570
Alexander, NC
Burke, NC
Caldwell, NC
Catawba, NC
3320 Honolulu, HI.................................. 1.1212 1.0815
Honolulu, HI
3350 Houma, LA..................................... 0.7596 0.8284
Lafourche, LA
Terrebonne, LA
3360 *Houston, TX.................................. 0.9874 0.9914
Chambers, TX
Fort Bend, TX
Harris, TX
Liberty, TX
Montgomery, TX
Waller, TX
3400 Huntington-Ashland, WV-KY-OH.................. 0.8997 0.9302
Boyd, KY
Carter, KY
Greenup, KY
Lawrence, OH
Cabell, WV
Wayne, WV
3440 Huntsville, AL................................ 0.8113 0.8666
Limestone, AL
Madison, AL
3480 *Indianapolis, IN............................. 0.9757 0.9833
Boone, IN
Hamilton, IN
Hancock, IN
Hendricks, IN
Johnson, IN
Madison, IN
Marion, IN
Morgan, IN
Shelby, IN
3500 Iowa City, IA................................. 0.9371 0.9565
Johnson, IA
3520 Jackson, MI................................... 0.9132 0.9397
Jackson, MI
3560 Jackson, MS................................... 0.7642 0.8318
Hinds, MS
Madison, MS
Rankin, MS
3580 Jackson, TN................................... 0.8511 0.8955
Madison, TN
3600 Jacksonville, FL.............................. 0.8953 0.9271
Clay, FL
Duval, FL
Nassau, FL
St. Johns, FL
3605 Jacksonville, NC.............................. 0.6926 0.7776
Onslow, NC
3610 Jamestown, NY................................. 0.7535 0.8238
Chautaqua, NY
3620 Janesville-Beloit, WI......................... 0.8786 0.9152
Rock, WI
3640 Jersey City, NJ............................... 1.1039 1.0700
Hudson, NJ
3660 Johnson City-Kingsport-Bristol, TN-VA......... 0.8769 0.9140
Carter, TN
Hawkins, TN
Sullivan, TN
Unicoi, TN
Washington, TN
[[Page 45886]]
Bristol City, VA
Scott, VA
Washington, VA
3680 Johnstown, PA................................. 0.8521 0.8962
Cambria, PA
Somerset, PA
3710 Joplin, MO.................................... 0.7923 0.8526
Jasper, MO
Newton, MO
3720 Kalamazoo-Battlecreek, MI..................... 1.0657 1.0445
Calhoun, MI
Kalamazoo, MI
Van Buren, MI
3740 Kankakee, IL.................................. 0.9114 0.9384
Kankakee, IL
3760 *Kansas City, KS-MO........................... 0.9351 0.9551
Johnson, KS
Leavenworth, KS
Miami, KS
Wyandotte, KS
Cass, MO
Clay, MO
Clinton, MO
Jackson, MO
Lafayette, MO
Platte, MO
Ray, MO
3800 Kenosha, WI................................... 0.8872 0.9213
Kenosha, WI
3810 Killeen-Temple, TX............................ 1.0526 1.0357
Bell, TX
Coryell, TX
3840 Knoxville, TN................................. 0.8518 0.8960
Anderson, TN
Blount, TN
Knox, TN
Loudon, TN
Sevier, TN
Union, TN
3850 Kokomo, IN.................................... 0.8834 0.9186
Howard, IN
Tipton, IN
3870 La Crosse, WI-MN.............................. 0.8519 0.8960
Houston, MN
La Crosse, WI
3880 Lafayette, LA................................. 0.8498 0.8945
Acadia, LA
Lafayette, LA
St. Landry, LA
St. Martin, LA
3920 Lafayette, IN................................. 0.8328 0.8822
Clinton, IN
Tippecanoe, IN
3960 Lake Charles, LA.............................. 0.8094 0.8652
Calcasieu, LA
3980 Lakeland-Winter Haven, FL..................... 0.8668 0.9067
Polk, FL
4000 Lancaster, PA................................. 0.9569 0.9703
Lancaster, PA
4040 Lansing-East Lansing, MI...................... 1.0105 1.0072
Clinton, MI
Eaton, MI
Ingham, MI
4080 Laredo, TX.................................... 0.6750 0.7640
Webb, TX
4100 Las Cruces, NM................................ 0.8861 0.9205
Dona Ana, NM
4120 *Las Vegas, NV-AZ............................. 1.0934 1.0631
Mohave, AZ
Clark, NV
Nye, NV
4150 Lawrence, KS.................................. 0.8549 0.8982
Douglas, KS
4200 Lawton, OK.................................... 0.8594 0.9014
Comanche, OK
4243 Lewiston-Auburn, ME........................... 0.9433 0.9608
Androscoggin, ME
4280 Lexington, KY................................. 0.8348 0.8837
Bourbon, KY
Clark, KY
Fayette, KY
Jessamine, KY
Madison, KY
Scott, KY
Woodford, KY
4320 Lima, OH...................................... 0.8863 0.9207
Allen, OH
Auglaize, OH
4360 Lincoln, NE................................... 0.9093 0.9370
Lancaster, NE
4400 Little Rock-North Little Rock, AR............. 0.8527 0.8966
Faulkner, AR
Lonoke, AR
Pulaski, AR
Saline, AR
4420 Longview-Marshall, TX......................... 0.8653 0.9057
Gregg, TX
Harrison, TX
Upshur, TX
4480 *Los Angeles-Long Beach, CA................... 1.2461 1.1626
Los Angeles, CA
4520 Louisville, KY-IN............................. 0.9327 0.9534
Clark, IN
Floyd, IN
Harrison, IN
Scott, IN
Bullitt, KY
Jefferson, KY
Oldham, KY
4600 Lubbock, TX................................... 0.8443 0.8906
Lubbock, TX
4640 Lynchburg, VA................................. 0.8205 0.8733
Amherst, VA
Bedford City, VA
Bedford, VA
Campbell, VA
Lynchburg City, VA
4680 Macon, GA..................................... 0.8991 0.9298
Bibb, GA
Houston, GA
Jones, GA
Peach, GA
Twiggs, GA
4720 Madison, WI................................... 1.0055 1.0038
Dane, WI
4800 Mansfield, OH................................. 0.8373 0.8855
Crawford, OH
Richland, OH
4840 Mayaguez, PR.................................. 0.4644 0.5914
Anasco, PR
Cabo Rojo, PR
Hormigueros, PR
Mayaguez, PR
Sabana Grande, PR
San German, PR
4880 McAllen-Edinburg-Mission, TX.................. 0.8669 0.9068
Hidalgo, TX
4890 Medford-Ashland, OR........................... 1.0162 1.0111
Jackson, OR
4900 Melbourne-Titusville-Palm Bay, FL............. 0.9323 0.9531
Brevard, Fl
4920 *Memphis, TN-AR-MS............................ 0.8399 0.8874
Crittenden, AR
De Soto, MS
Fayette, TN
Shelby, TN
Tipton, TN
4940 Merced, CA.................................... 1.0877 1.0593
Merced, CA
5000 *Miami, FL.................................... 0.9552 0.9691
Dade, FL
5015 *Middlesex-Somerset-Hunterdon, NJ............. 1.0583 1.0396
Hunterdon, NJ
Middlesex, NJ
Somerset, NJ
5080 *Milwaukee-Waukesha, WI....................... 0.9498 0.9653
Milwaukee, WI
Ozaukee, WI
Washington, WI
Waukesha, WI
5120 *Minneapolis-St Paul, MN-WI................... 1.0744 1.0504
Anoka, MN
Carver, MN
Chisago, MN
Dakota, MN
Hennepin, MN
Isanti, MN
Ramsey, MN
Scott, MN
Sherburne, MN
Washington, MN
Wright, MN
Pierce, WI
St. Croix, WI
5160 Mobile, AL.................................... 0.7706 0.8366
Baldwin, AL
Mobile, AL
5170 Modesto, CA................................... 1.0658 1.0446
Stanislaus, CA
5190 *Monmouth-Ocean, NJ........................... 1.0562 1.0382
Monmouth, NJ
[[Page 45887]]
Ocean, NJ
5200 Monroe, LA.................................... 0.7948 0.8545
Ouachita, LA
5240 Montgomery, AL................................ 0.7901 0.8510
Autauga, AL
Elmore, AL
Montgomery, AL
5280 Muncie, IN.................................... 0.9125 0.9392
Delaware, IN
5330 Myrtle Beach, SC.............................. 0.7961 0.8554
Horry, SC
5345 Naples, FL.................................... 0.9871 0.9911
Collier, FL
5360 *Nashville, TN................................ 0.9266 0.9491
Cheatham, TN
Davidson, TN
Dickson, TN
Robertson, TN
Rutherford TN
Sumner, TN
Williamson, TN
Wilson, TN
5380 *Nassau-Suffolk, NY........................... 1.3128 1.2049
Nassau, NY
Suffolk, NY
5483 *New Haven-Bridgeport-StamfordDanbury-
Waterbury, CT...................................... 1.2534 1.1673
Fairfield, CT
New Haven, CT
5523 New London-Norwich, CT........................ 1.2088 1.1387
New London, CT
5560 *New Orleans, LA.............................. 0.9454 0.9623
Jefferson, LA
Orleans, LA
Plaquemines, LA
St. Bernard, LA
St. Charles, LA
St. James, LA
St. John The Baptist, LA
St. Tammany, LA
5600 *New York, NY................................. 1.3852 1.2500
Bronx, NY
Kings, NY
New York, NY
Putnam, NY
Queens, NY
Richmond, NY
Rockland, NY
Westchester, NY
5640 *Newark, NJ................................... 1.1241 1.0834
Essex, NJ
Morris, NJ
Sussex, NJ
Union, NJ
Warren, NJ
5660 Newburgh, NY-PA............................... 1.0619 1.0420
Orange, NY
Pike, PA
5720 *Norfolk-Virginia
Beach-Newport
News, VA-NC 0.8411 0.8883
Currituck, NC
Chesapeake City, VA
Gloucester, VA
Hampton City, VA
Isle of Wight, VA
James City, VA
Mathews, VA
Newport News City, VA
Norfolk City, VA
Poquoson City, VA
Portsmouth City, VA
Suffolk City, VA
Virginia Beach City, VA
Williamsburg City, VA
York, VA
5775 *Oakland, CA.................................. 1.5203 1.3322
Alameda, CA
Contra Costa, CA
5790 Ocala, FL..................................... 0.8942 0.9263
Marion, FL
5800 Odessa-Midland, TX............................ 0.8753 0.9128
Ector, TX
Midland, TX
5880 *Oklahoma City, OK............................ 0.8358 0.8844
Canadian, OK
Cleveland, OK
Logan, OK
McClain, OK
Oklahoma, OK
Pottawatomie, OK
5910 Olympia, WA................................... 1.1109 1.0747
Thurston, WA
5920 Omaha, NE-IA.................................. 0.9794 0.9858
Pottawattamie, IA
Cass, NE
Douglas, NE
Sarpy, NE
Washington, NE
5945 *Orange County, CA............................ 1.2299 1.1522
Orange, CA
5960 *Orlando, FL.................................. 0.9515 0.9665
Lake, FL
Orange, FL
Osceola, FL
Seminole, FL
5990 Owensboro, KY................................. 0.7498 0.8210
Daviess, KY
6015 Panama City, FL............................... 0.8182 0.8716
Bay, FL
6020 Parkersburg-Marietta, WV-OH................... 0.7751 0.8399
Washington, OH
Wood, WV
6080 Pensacola, FL................................. 0.8183 0.8717
Escambia, FL
Santa Rosa, FL
6120 Peoria-Pekin, IL.............................. 0.8619 0.9032
Peoria, IL
Tazewell, IL
Woodford, IL
6160 *Philadelphia, PA-NJ.......................... 1.1098 1.0739
Burlington, NJ
Camden, NJ
Gloucester, NJ
Salem, NJ
Bucks, PA
Chester, PA
Delaware, PA
Montgomery, PA
Philadelphia, PA
6200 *Phoenix-Mesa, AZ............................. 0.9808 0.9868
Maricopa, AZ
Pinal, AZ
6240 Pine Bluff, AR................................ 0.7985 0.8572
Jefferson, AR
6280 *Pittsburgh, PA............................... 0.9743 0.9823
Allegheny, PA
Beaver, PA
Butler, PA
Fayette, PA
Washington, PA
Westmoreland, PA
6323 Pittsfield, MA................................ 1.0838 1.0567
Berkshire, MA
6360 Ponce, PR..................................... 0.4780 0.6032
Guayanilla, PR
Juana Diaz, PR
Penuelas, PR
Ponce, PR
Villalba, PR
Yauco, PR
6403 Portland, ME.................................. 0.9744 0.9824
Cumberland, ME
Sagadahoc, ME
York, ME
6440 *Portland-Vancouver, OR-WA.................... 1.1248 1.0839
Clackamas, OR
Columbia, OR
Multnomah, OR
Washington, OR
Yamhill, OR
Clark, WA
6483 *Providence-Warwick, RI....................... 1.1027 1.0692
Bristol, RI
Kent, RI
Newport, RI
Providence, RI
Washington, RI
6520 Provo-Orem, UT................................ 0.9843 0.9892
Utah, UT
6560 Pueblo, CO.................................... 0.8508 0.8953
Pueblo, CO
6580 Punta Gorda, FL............................... 0.8806 0.9166
Charlotte, FL
6600 Racine, WI.................................... 0.8704 0.9093
Racine, WI
6640 Raleigh-Durham-Chapel Hill, NC................ 0.9539 0.9682
Chatham, NC
Durham, NC
Franklin, NC
Johnston, NC
Orange, NC
[[Page 45888]]
Wake, NC
6660 Rapid City, SD................................ 0.8267 0.8778
Pennington, SD
6680 Reading, PA................................... 0.9570 0.9704
Berks, PA
6690 Redding, CA................................... 1.1796 1.1198
Shasta, CA
6720 Reno, NV...................................... 1.1087 1.0732
Washoe, NV
6740 Richland-Kennewick-Pasco, WA.................. 1.0011 1.0008
Benton, WA
Franklin, WA
6760 Richmond-Petersburg, VA....................... 0.9055 0.9343
Charles City County, VA
Chesterfield, VA
Colonial Heights City, VA
Dinwiddie, VA
Goochland, VA
Hanover, VA
Henrico, VA
Hopewell City, VA
New Kent, VA
Petersburg City, VA
Powhatan, VA
Prince George, VA
Richmond City, VA
6780 *Riverside-San Bernardino, CA................. 1.1489 1.0997
Riverside, CA
San Bernardino, CA
6800 Roanoke, VA................................... 0.8570 0.8997
Botetourt, VA
Roanoke, VA
Roanoke City, VA
Salem City, VA
6820 Rochester, MN................................. 1.0545 1.0370
Olmsted, MN
6840 *Rochester, NY................................ 0.9585 0.9714
Genesee, NY
Livingston, NY
Monroe, NY
Ontario, NY
Orleans, NY
Wayne, NY
6880 Rockford, IL.................................. 0.8872 0.9213
Boone, IL
Ogle, IL
Winnebago, IL
6895 Rocky Mount, NC............................... 0.8836 0.9187
Edgecombe, NC
Nash, NC
6920 *Sacramento, CA............................... 1.2539 1.1676
El Dorado, CA
Placer, CA
Sacramento, CA
6960 Saginaw-Bay City-Midland, MI.................. 0.9489 0.9647
Bay, MI
Midland, MI
Saginaw, MI
6980 St. Cloud, MN................................. 0.9549 0.9689
Benton, MN
Stearns, MN
7000 St. Joseph, MO................................ 0.8457 0.8916
Andrews, MO
Buchanan, MO
7040 *St. Louis, MO-IL............................. 0.8880 0.9219
Clinton, IL
Jersey, IL
Madison, IL
Monroe, IL
St. Clair, IL
Franklin, MO
Jefferson, MO
Lincoln, MO
St. Charles, MO
St. Louis, MO
St. Louis City, MO
Warren, MO
7080 Salem, OR..................................... 0.9575 0.9707
Marion, OR
Polk, OR
7120 Salinas, CA................................... 1.4263 1.2753
Monterey, CA
7160 *Salt Lake City-Ogden, UT..................... 0.9681 0.9780
Davis, UT
Salt Lake, UT
Weber, UT
7200 San Angelo, TX................................ 0.7777 0.8418
Tom Green, TX
7240 *San Antonio, TX.............................. 0.8414 0.8885
Bexar, TX
Comal, TX
Guadalupe, TX
Wilson, TX
7320 *San Diego, CA................................ 1.1856 1.1237
San Diego, CA
7360 *San Francisco, CA............................ 1.4288 1.2768
Marin, CA
San Francisco, CA
San Mateo, CA
7400 *San Jose, CA................................. 1.4455 1.2870
Santa Clara, CA
7440 *San Juan-Bayamon, PR......................... 0.4514 0.5800
Aguas Buenas, PR
Barceloneta, PR
Bayamon, PR
Canovanas, PR
Carolina, PR
Catano, PR
Ceiba, PR
Comerio, PR
Corozal, PR
Dorado, PR
Fajardo, PR
Florida, PR
Guaynabo, PR
Humacao, PR
Juncos, PR
Los Piedras, PR
Loiza, PR
Luguillo, PR
Manati, PR
Naranjito, PR
Rio Grande, PR
San Juan, PR
Toa Alta, PR
Toa Baja, PR
Trujillo Alto, PR
Vega Alta, PR
Vega Baja, PR
Yabucoa, PR
7460 San Luis Obispo-Atascadero-Paso Robles, CA.... 1.1405 1.0942
San Luis Obispo, CA
7480 Santa Barbara-Santa Maria-Lompoc, CA.......... 1.1136 1.0765
Santa Barbara, CA
7485 Santa Cruz-Watsonville, CA.................... 1.3944 1.2557
Santa Cruz, CA
7490 Santa Fe, NM.................................. 1.1108 1.0746
Los Alamos, NM
Santa Fe, NM
7500 Santa Rosa, CA................................ 1.2693 1.1774
Sonoma, CA
7510 Sarasota-Bradenton, FL........................ 0.9824 0.9879
Manatee, FL
Sarasota, FL
7520 Savannah, GA.................................. 0.8968 0.9281
Bryan, GA
Chatham, GA
Effingham, GA
7560 Scranton--Wilkes-Barre--Hazleton, PA.......... 0.8724 0.9108
Columbia, PA
Lackawanna, PA
Luzerne, PA
Wyoming, PA
7600 *Seattle-Bellevue-Everett, WA................. 1.1307 1.0878
Island, WA
King, WA
Snohomish, WA
7610 Sharon, PA.................................... 0.9093 0.9370
Mercer, PA
7620 Sheboygan, WI................................. 0.7981 0.8569
Sheboygan, WI
7640 Sherman-Denison, TX........................... 0.8780 0.9148
Grayson, TX
7680 Shreveport-Bossier City, LA................... 0.9007 0.9309
Bossier, LA
Caddo, LA
Webster, LA
7720 Sioux City, IA-NE............................. 0.8436 0.8901
Woodbury, IA
Dakota, NE
7760 Sioux Falls, SD............................... 0.8761 0.9134
Lincoln, SD
Minnehaha, SD
7800 South Bend, IN................................ 0.9475 0.9637
St. Joseph, IN
7840 Spokane, WA................................... 1.0377 1.0257
Spokane, WA
7880 Springfield, IL............................... 0.8940 0.9261
[[Page 45889]]
Menard, IL
Sangamon, IL
7920 Springfield, MO............................... 0.7896 0.8506
Christian, MO
Greene, MO
Webster, MO
8003 Springfield, MA............................... 1.0517 1.0351
Hampden, MA
Hampshire, MA
8050 State College, PA............................. 1.0162 1.0111
Centre, PA
8080 Steubenville-Weirton, OH-WV................... 0.8455 0.8914
Jefferson, OH
Brooke, WV
Hancock, WV
8120 Stockton-Lodi, CA............................. 1.1672 1.1117
San Joaquin, CA
8140 Sumter, SC.................................... 0.8344 0.8834
Sumter, SC
8160 Syracuse, NY.................................. 0.9531 0.9676
Cayuga, NY
Madison, NY
Onondaga, NY
Oswego, NY
8200 Tacoma, WA.................................... 1.0828 1.0560
Pierce, WA
8240 Tallahassee, FL............................... 0.8321 0.8817
Gadsden, FL
Leon, FL
8280 *Tampa-St. Petersburg-Clearwater, FL.......... 0.9311 0.9523
Hernando, FL
Hillsborough, FL
Pasco, FL
Pinellas, FL
8320 Terre Haute, IN............................... 0.8672 0.9070
Clay, IN
Vermillion, IN
Vigo, IN
8360 Texarkana, AR-Texarkana, TX................... 0.8257 0.8771
Miller, AR
Bowie, TX
8400 Toledo, OH.................................... 1.0330 1.0225
Fulton, OH
Lucas, OH
Wood, OH
8440 Topeka, KS.................................... 0.9735 0.9818
Shawnee, KS
8480 Trenton, NJ................................... 1.0033 1.0023
Mercer, NJ
8520 Tucson, AZ.................................... 0.9291 0.9509
Pima, AZ
8560 Tulsa, OK..................................... 0.8245 0.8762
Creek, OK
Osage, OK
Rogers, OK
Tulsa, OK
Wagoner, OK
8600 Tuscaloosa, AL................................ 0.8090 0.8649
Tuscaloosa, AL
8640 Tyler, TX..................................... 0.9430 0.9606
Smith, TX
8680 Utica-Rome, NY................................ 0.8514 0.8957
Herkimer, NY
Oneida, NY
8720 Vallejo-Fairfield-Napa, CA.................... 1.3040 1.1993
Napa, CA
Solano, CA
8735 Ventura, CA................................... 1.2330 1.1542
Ventura, CA
8750 Victoria, TX.................................. 0.8435 0.8900
Victoria, TX
8760 Vineland-Millville-Bridgeton, NJ.............. 0.9966 0.9977
Cumberland, NJ
8780 Visalia-Tulare-Porterville, CA................ 1.0446 1.0303
Tulare, CA
8800 Waco, TX...................................... 0.7898 0.8508
McLennan, TX
8840 *Washington, DC-MD-VA-WV...................... 1.1075 1.0724
District of Columbia, DC
Calvert, MD
Charles, MD
Frederick, MD
Montgomery, MD
Prince Georges, MD
Alexandria City, VA
Arlington, VA
Clarke, VA
Culpepper, VA
Fairfax, VA
Fairfax City, VA
Falls Church City, VA
Fauquier, VA
Fredericksburg City, VA
King George, VA
Loudoun, VA
Manassas City, VA
Manassas Park City, VA
Prince William, VA
Spotsylvania, VA
Stafford, VA
Warren, VA
Berkeley, WV
Jefferson, WV
8920 Waterloo-Cedar Falls, IA...................... 0.8638 0.9046
Black Hawk, IA
8940 Wausau, WI.................................... 1.0034 1.0023
Marathon, WI
8960 West Palm Beach-Boca Raton, FL................ 1.0096 1.0066
Palm Beach, FL
9000 Wheeling, OH-WV............................... 0.7518 0.8225
Belmont, OH
Marshall, WV
Ohio, WV
9040 Wichita, KS................................... 0.9562 0.9698
Butler, KS
Harvey, KS
Sedgwick, KS
9080 Wichita Falls, TX............................. 0.7763 0.8408
Archer, TX
Wichita, TX
9140 Williamsport, PA.............................. 0.8508 0.8953
Lycoming, PA
9160 Wilmington-Newark, DE-MD...................... 1.1539 1.1030
New Castle, DE
Cecil, MD
9200 Wilmington, NC................................ 0.9299 0.9514
New Hanover, NC
Brunswick, NC
9260 Yakima, WA.................................... 0.9951 0.9966
Yakima, WA
9270 Yolo, CA...................................... 1.1615 1.1080
Yolo, CA
9280 York, PA...................................... 0.9165 0.9420
York, PA
9320 Youngstown-Warren, OH......................... 0.9555 0.9693
Columbiana, OH
Mahoning, OH
Trumbull, OH
9340 Yuba City, CA................................. 1.0611 1.0414
Sutter, CA
Yuba, CA
9360 Yuma, AZ...................................... 0.9769 0.9841
Yuma, AZ
------------------------------------------------------------------------
Table 4b.--Wage Index and Capital Geographic Adjustment Factor (GAF) for
Rural Areas
------------------------------------------------------------------------
Wage
Nonurban area index GAF
------------------------------------------------------------------------
Alabama............................................. 0.7183 0.7973
Alaska.............................................. 1.2034 1.1352
Arizona............................................. 0.7995 0.8579
Arkansas............................................ 0.6901 0.7757
California.......................................... 1.0096 1.0066
Colorado............................................ 0.7988 0.8574
Connecticut......................................... 1.3117 1.2042
Delaware............................................ 0.9019 0.9317
Florida............................................. 0.8668 0.9067
Georgia............................................. 0.7721 0.8377
Hawaii.............................................. 0.9847 0.9895
Idaho............................................... 0.8378 0.8859
Illinois............................................ 0.7497 0.8210
Indiana............................................. 0.8067 0.8632
Iowa................................................ 0.7352 0.8101
Kansas.............................................. 0.7229 0.8007
Kentucky............................................ 0.7660 0.8331
Louisiana........................................... 0.7275 0.8042
Maine............................................... 0.8425 0.8893
Maryland............................................ 0.8463 0.8920
Massachusetts....................................... 1.0577 1.0392
Michigan............................................ 0.8744 0.9122
Minnesota........................................... 0.8129 0.8677
Mississippi......................................... 0.6697 0.7599
Missouri............................................ 0.7187 0.7976
Montana............................................. 0.8091 0.8650
Nebraska............................................ 0.7219 0.8000
Nevada.............................................. 0.8788 0.9153
New Hampshire....................................... 1.0013 1.0009
[[Page 45890]]
New Jersey \1\...................................... ........ ........
New Mexico.......................................... 0.8329 0.8823
New York............................................ 0.8647 0.9052
North Carolina...................................... 0.7983 0.8570
North Dakota........................................ 0.7265 0.8035
Ohio................................................ 0.8286 0.8792
Oklahoma............................................ 0.6985 0.7821
Oregon.............................................. 0.9486 0.9645
Pennsylvania........................................ 0.8521 0.8962
Puerto Rico......................................... 0.4326 0.5634
Rhode Island \1\.................................... ........ ........
South Carolina...................................... 0.7738 0.8389
South Dakota........................................ 0.6987 0.7823
Tennessee........................................... 0.7409 0.8144
Texas............................................... 0.7302 0.8063
Utah................................................ 0.8652 0.9056
Vermont............................................. 0.9043 0.9334
Virginia............................................ 0.7801 0.8436
Washington.......................................... 0.9775 0.9845
West Virginia....................................... 0.8069 0.8634
Wisconsin........................................... 0.8391 0.8868
Wyoming............................................. 0.8013 0.8592
------------------------------------------------------------------------
\1\ All counties within the State are classified urban.
Table 4c.--Wage Index and Capital Geographic Adjustment Factor (GAF) for
Hospitals That Are Reclassified
------------------------------------------------------------------------
Wage
Area reclassified to index GAF
------------------------------------------------------------------------
Abilene, TX......................................... 0.8546 0.8980
Albuquerque, NM..................................... 0.9542 0.9684
Alexandria, LA...................................... 0.8010 0.8590
Allentown-Bethlehem-Easton, PA...................... 1.0198 1.0135
Amarillo, TX........................................ 0.8759 0.9133
Anchorage, AK....................................... 1.3373 1.2202
Asheville, NC....................................... 0.9218 0.9458
Atlanta, GA......................................... 1.0069 1.0047
Augusta-Aiken, GA-SC................................ 0.8955 0.9272
Baton Rouge, LA..................................... 0.8670 0.9069
Benton Harbor, MI................................... 0.8304 0.8805
Benton Harbor, MI (Rural Michigan Hosp.)............ 0.8744 0.9122
Bergen-Passaic, NJ.................................. 1.1329 1.0892
Biloxi-Gulfport-Pascagoula, MS...................... 0.8448 0.8909
Birmingham, AL...................................... 0.9144 0.9406
Bismarck, ND........................................ 0.8172 0.8709
Boise City, ID...................................... 0.9150 0.9410
Boston-Brockton-Nashua, MA-NH....................... 1.1685 1.1125
Brazoria, TX........................................ 0.7724 0.8379
Casper, WY.......................................... 0.8662 0.9063
Champaign-Urbana, IL................................ 0.8664 0.9065
Charleston-North Charleston, SC..................... 0.8930 0.9254
Charleston, WV...................................... 0.9317 0.9527
Charlotte-Gastonia-Rock Hill, NC-SC................. 0.9668 0.9771
Charlottesville, VA................................. 0.9030 0.9325
Chattanooga, TN-GA.................................. 0.9015 0.9315
Chicago, IL......................................... 1.0511 1.0347
Cincinnati, OH-KY-IN................................ 0.9418 0.9598
Cleveland-Lorain-Elyria, OH......................... 0.9835 0.9887
Columbia, MO........................................ 0.9151 0.9411
Columbus, GA-AL..................................... 0.7756 0.8403
Columbus, OH........................................ 0.9734 0.9817
Dallas, TX.......................................... 0.9804 0.9865
Davenport-Rock Island-Moline, IA-IL................. 0.8347 0.8836
Dayton-Springfield, OH.............................. 0.9428 0.9605
Denver, CO.......................................... 1.0447 1.0304
Des Moines, IA...................................... 0.8684 0.9079
Detroit, MI......................................... 1.0834 1.0564
Duluth-Superior, MN-WI.............................. 0.9660 0.9766
Dutchess County, NY................................. 1.0546 1.0371
Eau Claire, WI...................................... 0.8660 0.9062
Elkhart-Goshen, IN.................................. 0.8806 0.9166
Eugene-Springfield, OR.............................. 1.1184 1.0796
Fargo-Moorhead, ND-MN............................... 0.8912 0.9242
Fayetteville, NC.................................... 0.8504 0.8950
Flint, MI........................................... 1.0738 1.0500
Florence, AL........................................ 0.7970 0.8561
Florence, SC........................................ 0.8537 0.8973
Fort Lauderdale, FL................................. 1.0952 1.0643
Fort Pierce-Port St Lucie, FL....................... 1.0069 1.0047
Fort Smith, AR-OK................................... 0.7608 0.8293
Fort Walton Beach, FL............................... 0.8705 0.9094
Fort Worth-Arlington, TX............................ 1.0052 1.0036
Gadsden, AL......................................... 0.8568 0.8996
Grand Forks, ND-MN.................................. 0.8983 0.9292
Great Falls, MT..................................... 0.9039 0.9331
Greeley, CO......................................... 0.8993 0.9299
Green Bay, WI....................................... 0.9190 0.9438
Greenville-Spartanburg-Anderson, SC................. 0.9047 0.9337
Harrisburg-Lebanon-Carlisle, PA..................... 0.9972 0.9981
Hartford, CT........................................ 1.2228 1.1477
Honolulu, HI........................................ 1.1212 1.0815
Houston, TX......................................... 0.9874 0.9914
Huntington-Ashland, WV-KY-OH........................ 0.8997 0.9302
Huntsville, AL...................................... 0.7948 0.8545
Indianapolis, IN.................................... 0.9647 0.9757
Jackson, MS......................................... 0.7642 0.8318
Jacksonville, FL.................................... 0.8953 0.9271
Johnson City-Kingsport-Bristol, TN-VA............... 0.8769 0.9140
Joplin, MO.......................................... 0.7923 0.8526
Kalamazoo-Battlecreek, MI........................... 1.0449 1.0305
Kansas City, KS-MO.................................. 0.9351 0.9551
Knoxville, TN....................................... 0.8518 0.8960
Lafayette, LA....................................... 0.8498 0.8945
Lansing-East Lansing, MI............................ 1.0105 1.0072
Las Vegas, NV-AZ.................................... 1.0934 1.0631
Lexington, KY....................................... 0.8348 0.8837
Lima, OH............................................ 0.8863 0.9207
Lincoln, NE......................................... 0.8885 0.9222
Little Rock-North Little Rock, AR................... 0.8527 0.8966
Longview-Marshall, TX............................... 0.8479 0.8932
Los Angeles-Long Beach, CA.......................... 1.2461 1.1626
Louisville, KY-IN................................... 0.9327 0.9534
Lubbock, TX......................................... 0.8443 0.8906
Madison, WI......................................... 1.0055 1.0038
Mansfield, OH....................................... 0.8373 0.8855
Medford-Ashland, OR................................. 1.0162 1.0111
Memphis, TN-AR-MS................................... 0.8292 0.8796
Middlesex-Somerset-Hunterdon, NJ.................... 1.0355 1.0242
Milwaukee-Waukesha, WI.............................. 0.9498 0.9653
Minneapolis-St. Paul, MN-WI......................... 1.0744 1.0504
Modesto, CA......................................... 1.0658 1.0446
Monroe, LA.......................................... 0.7948 0.8545
Montgomery, AL...................................... 0.7901 0.8510
Nashville, TN....................................... 0.9266 0.9491
New London-Norwich, CT.............................. 1.2088 1.1387
New Orleans, LA..................................... 0.9454 0.9623
New York, NY........................................ 1.3852 1.2500
Newark, NJ.......................................... 1.1241 1.0834
Newburgh, NY-PA..................................... 1.0619 1.0420
Oakland, CA......................................... 1.5203 1.3322
Odessa-Midland, TX.................................. 0.8753 0.9128
Oklahoma City, OK................................... 0.8358 0.8844
Omaha, NE-IA........................................ 0.9794 0.9858
Orange County, CA................................... 1.5593 1.3556
Peoria-Pekin, IL.................................... 0.8619 0.9032
Philadelphia, PA-NJ................................. 1.1098 1.0739
Pittsburgh, PA...................................... 0.9743 0.9823
Portland, ME........................................ 0.9744 0.9824
Portland-Vancouver, OR-WA........................... 1.1248 1.0839
Provo-Orem, UT...................................... 0.9646 0.9756
Raleigh-Durham-Chapel Hill, NC...................... 0.9539 0.9682
Rapid City, SD...................................... 0.8267 0.8778
Richland-Kennewick-Pasco, WA........................ 0.9768 0.9841
Roanoke, VA......................................... 0.8570 0.8997
Rochester, MN....................................... 1.0545 1.0370
Rockford, IL........................................ 0.8872 0.9213
Rocky Mount, NC..................................... 0.8836 0.9187
Sacremento, CA...................................... 1.2539 1.1676
Saginaw-Bay City-Midland, MI,....................... 0.9489 0.9647
St. Cloud, MN....................................... 0.9549 0.9689
St. Louis, MO-IL.................................... 0.8880 0.9219
Salem, OR........................................... 0.9575 0.9707
Salinas, CA......................................... 1.4141 1.2678
Salt Lake City-Ogden, UT............................ 0.9681 0.9780
San Diego, CA....................................... 1.1856 1.1237
San Francisco, CA................................... 1.4288 1.2768
San Jose, CA........................................ 1.4455 1.2870
Santa Rosa, CA...................................... 1.2574 1.1698
Sarasota-Bradenton, FL.............................. 0.9824 0.9879
Savannah, GA........................................ 0.8968 0.9281
Seattle-Bellevue-Everett, WA........................ 1.1307 1.0878
Sharon, PA.......................................... 0.9093 0.9370
Sherman-Denison, TX................................. 0.8436 0.8901
Sioux Falls, SD..................................... 0.8761 0.9134
South Bend, IN...................................... 0.9475 0.9637
Springfield, IL..................................... 0.8836 0.9187
Springfield, MO..................................... 0.7896 0.8506
Stockton, CA........................................ 1.1672 1.1117
[[Page 45891]]
Syracuse, NY........................................ 0.9531 0.9676
Tampa-St. Petersburg-Clearwater, FL................. 0.9311 0.9523
Texarkana, TX-Texarkana, AR......................... 0.8257 0.8771
Topeka, KS.......................................... 0.9401 0.9586
Trenton, NJ......................................... 1.2599 1.1714
Tucson, AZ.......................................... 0.9291 0.9509
Tulsa, OK........................................... 0.8245 0.8762
Tyler, TX........................................... 0.9164 0.9420
Ventura, CA......................................... 1.2330 1.1542
Victoria, TX........................................ 0.8435 0.8900
Waco, TX............................................ 0.7898 0.8508
Washington, DC-MD-VA-WV............................. 1.1075 1.0724
Waterloo-Cedar Falls, IA............................ 0.8638 0.9046
Wausau, WI.......................................... 0.9679 0.9779
Wichita, KS......................................... 0.9309 0.9521
Rural Alabama....................................... 0.7183 0.7973
Rural Arkansas...................................... 0.6901 0.7757
Rural Florida....................................... 0.8668 0.9067
Rural Kentucky...................................... 0.7660 0.8331
Rural Louisiana..................................... 0.7275 0.8042
Rural Michigan...................................... 0.8744 0.9122
Rural Minnesota..................................... 0.8129 0.8677
Rural Missouri...................................... 0.7187 0.7976
Rural New Hampshire................................. 1.0013 1.0009
Rural North Carolina................................ 0.7983 0.8570
Rural Virginia...................................... 0.7801 0.8436
Rural West Virginia................................. 0.8069 0.8634
Rural Wyoming....................................... 0.8013 0.8592
------------------------------------------------------------------------
Table 4d.--Average Hourly Wage for Urban Areas
------------------------------------------------------------------------
Average
Urban area hourly
wage
------------------------------------------------------------------------
Abilene, TX.................................................. 16.1778
Aguadilla, PR................................................ 8.9796
Akron, OH.................................................... 18.0935
Albany, GA................................................... 16.2942
Albany-Schenectady-Troy, NY.................................. 16.6927
Albuquerque, NM.............................................. 18.0635
Alexandria, LA............................................... 14.9860
Allentown-Bethlehem-Easton, PA-NJ............................ 19.3050
Altoona, PA.................................................. 17.0490
Amarillo, TX................................................. 16.5798
Anchorage, AK................................................ 25.3141
Ann Arbor, MI................................................ 22.9356
Anniston, AL................................................. 15.4427
Appleton-Oshkosh-Neenah, WI.................................. 16.7413
Arecibo, PR.................................................. 8.5149
Asheville, NC................................................ 17.4501
Athens, GA................................................... 17.2208
Atlanta, GA.................................................. 19.0600
Atlantic City-Cape May, NJ................................... 20.7004
Augusta-Aiken, GA-SC......................................... 16.9519
Austin-San Marcos, TX........................................ 17.5193
Bakersfield, CA.............................................. 19.8792
Baltimore, MD................................................ 18.6758
Bangor, ME................................................... 17.7185
Barnstable-Yarmouth, MA...................................... 25.4728
Baton Rouge, LA.............................................. 16.4123
Beaumont-Port Arthur, TX..................................... 16.2858
Bellingham, WA............................................... 24.0042
Benton Harbor, MI............................................ 15.6323
Bergen-Passaic, NJ........................................... 22.1050
Billings, MT................................................. 16.4779
Biloxi-Gulfport-Pascagoula, MS............................... 15.9912
Binghamton, NY............................................... 17.0452
Birmingham, AL............................................... 17.3090
Bismarck, ND................................................. 15.7090
Bloomington, IN.............................................. 15.9556
Bloomington-Normal, IL....................................... 16.5439
Boise City, ID............................................... 17.1324
Boston-Brockton-Nashua, MA-NH................................ 22.1167
Boulder-Longmont, CO......................................... 18.5131
Brazoria, TX................................................. 16.6847
Bremerton, WA................................................ 19.4876
Brownsville-Harlingen-San Benito, TX......................... 16.3732
Bryan-College Station, TX.................................... 17.0117
Buffalo-Niagara Falls, NY.................................... 17.3886
Burlington, VT............................................... 17.5139
Caguas, PR................................................... 8.9087
Canton-Massillon, OH......................................... 16.5610
Casper, WY................................................... 15.9558
Cedar Rapids, IA............................................. 15.8233
Champaign-Urbana, IL......................................... 16.7843
Charleston-North Charleston, SC.............................. 16.9003
Charleston, WV............................................... 17.9801
Charlotte-Gastonia-Rock Hill, NC-SC.......................... 18.3004
Charlottesville, VA.......................................... 17.3750
Chattanooga, TN-GA........................................... 17.2815
Cheyenne, WY................................................. 15.0213
Chicago, IL.................................................. 20.1255
Chico-Paradise, CA........................................... 19.9349
Cincinnati, OH-KY-IN......................................... 17.8270
Clarksville-Hopkinsville, TN-KY.............................. 14.2763
Cleveland-Lorain-Elyria, OH.................................. 18.6165
Colorado Springs, CO......................................... 17.5930
Columbia, MO................................................. 17.9090
Columbia, SC................................................. 17.0995
Columbus, GA-AL.............................................. 14.6815
Columbus, OH................................................. 18.4253
Corpus Christi, TX........................................... 16.9241
Cumberland, MD-WV............................................ 15.8483
Dallas, TX................................................... 18.5580
Danville, VA................................................. 16.0243
Davenport-Moline-Rock Island, IA-IL.......................... 15.8012
Dayton-Springfield, OH....................................... 17.8462
Daytona Beach, FL............................................ 16.8507
Decatur, AL.................................................. 15.4835
Decatur, IL.................................................. 14.7466
Denver, CO................................................... 19.7749
Des Moines, IA............................................... 16.6435
Detroit, MI.................................................. 20.4975
Dothan, AL................................................... 14.6729
Dover, DE.................................................... 16.9613
Dubuque, IA.................................................. 15.2452
Duluth-Superior, MN-WI....................................... 18.2853
Dutchess County, NY.......................................... 20.2495
Eau Claire, WI............................................... 16.3926
El Paso, TX.................................................. 17.5401
Elkhart-Goshen, IN........................................... 16.5895
Elmira, NY................................................... 16.0141
Enid, OK..................................................... 15.4658
Erie, PA..................................................... 17.4069
Eugene-Springfield, OR....................................... 21.0833
Evansville, Henderson, IN-KY................................. 16.8454
Fargo-Moorhead, ND-MN........................................ 16.8702
Fayetteville, NC............................................. 16.7399
Fayetteville-Springdale-Rogers, AR........................... 13.4214
Flagstaff, AZ-UT............................................. 16.3150
Flint, MI.................................................... 20.3263
Florence, AL................................................. 14.5759
Florence, SC................................................. 16.1316
Fort Collins-Loveland, CO.................................... 20.0554
Fort Lauderdale, FL.......................................... 19.8737
Fort Myers-Cape Coral, FL.................................... 18.2967
Fort Pierce-Fort St Lucie, FL................................ 19.6884
Fort Smith, AR-OK............................................ 14.3640
Fort Walton Beach, FL........................................ 16.4775
Fort Wayne, IN............................................... 16.4522
Fort Worth-Arlington, TX..................................... 19.0148
Fresno, CA................................................... 19.9179
Gadsden, AL.................................................. 16.2189
Gainesville, FL.............................................. 17.0500
Galveston-Texas City, TX..................................... 19.5055
Gary, IN..................................................... 18.0150
Glens Falls, NY.............................................. 17.5596
Goldsboro, NC................................................ 15.4556
Grand Forks, ND-MN........................................... 16.9349
Grand Junction, CO........................................... 16.9556
Grand Rapids-Muskegon-Holland, MI............................ 19.0334
Great Falls, MT.............................................. 16.8712
Greeley, CO.................................................. 17.3139
Green Bay, WI................................................ 16.8657
Greensboro-Winston-Salem-High Point, NC...................... 17.3386
Greenville, NC............................................... 17.2294
Greenville-Spartanburg-Anderson, SC.......................... 17.1252
Hagerstown, MD............................................... 17.1762
Hamilton-Middletown, OH...................................... 16.6240
Harrisburg-Lebanon-Carlisle, PA.............................. 18.8766
Hartford, CT................................................. 23.4548
Hattiesburg, MS.............................................. 13.7150
Hickory-Morganton-Lenoir, NC................................. 16.4247
Honolulu, HI................................................. 21.2237
Houma, LA.................................................... 14.3783
Houston, TX.................................................. 18.6920
Huntington-Ashland, WV-KY-OH................................. 17.0304
Huntsville, AL............................................... 15.3580
Indianapolis, IN............................................. 18.4690
Iowa City, IA................................................ 17.7396
Jackson, MI.................................................. 17.2871
Jackson, MS.................................................. 14.2875
Jackson, TN.................................................. 16.1114
Jacksonville, FL............................................. 16.9472
Jacksonville, NC............................................. 13.1113
Jamestown, NY................................................ 14.2640
Janesville-Beloit, WI........................................ 16.6310
Jersey City, NJ.............................................. 20.9167
Johnson City-Kingsport-Bristol, TN-VA........................ 16.5566
Johnstown, PA................................................ 16.9376
Joplin, MO................................................... 14.9986
Kalamazoo-Battle Creek, MI................................... 20.1733
Kankakee, IL................................................. 17.2516
Kansas City, KS-MO........................................... 17.7010
Kenosha, WI.................................................. 16.7936
Killeen-Temple, TX........................................... 19.9249
Knoxville, TN................................................ 16.1236
Kokomo, IN................................................... 16.7227
LaCrosse, WI-MN.............................................. 16.1256
Lafayette, LA................................................ 15.9831
[[Page 45892]]
Lafayette, IN................................................ 15.7641
Lake Charles, LA............................................. 15.3213
Lakeland-Winter Haven, FL.................................... 16.8079
Lancaster, PA................................................ 18.1140
Lansing-East Lansing, MI..................................... 19.1281
Laredo, TX................................................... 12.7772
Las Cruces, NM............................................... 16.7732
Las Vegas, NV-AZ............................................. 20.6967
Lawrence, KS................................................. 16.1829
Lawton, OK................................................... 16.2688
Lewiston-Auburn, ME.......................................... 17.8565
Lexington, KY................................................ 15.8030
Lima, OH..................................................... 16.7765
Lincoln, NE.................................................. 17.2129
Little Rock-North Little Rock, AR............................ 16.1414
Longview-Marshall, TX........................................ 16.5201
Los Angeles-Long Beach, CA................................... 23.6449
Louisville, KY-IN............................................ 17.6559
Lubbock, TX.................................................. 15.9821
Lynchburg, VA................................................ 15.5313
Macon, GA.................................................... 17.0204
Madison, WI.................................................. 19.0333
Mansfield, OH................................................ 15.8496
Mayaguez, PR................................................. 8.7914
McAllen-Edinburg-Mission, TX................................. 16.4091
Medford-Ashland, OR.......................................... 18.8231
Melbourne-Titusville-Palm Bay, FL............................ 17.6476
Memphis, TN-AR-MS............................................ 15.8992
Merced, CA................................................... 20.5898
Miami, FL.................................................... 19.2390
Middlesex-Somerset-Hunterdon, NJ............................. 20.4619
Milwaukee-Waukesha, WI....................................... 17.9801
Minneapolis-St Paul, MN-WI................................... 20.3375
Mobile, AL................................................... 14.7679
Modesto, CA.................................................. 21.1266
Monmouth-Ocean, NJ........................................... 19.9942
Monroe, LA................................................... 14.9551
Montgomery, AL............................................... 14.9130
Muncie, IN................................................... 17.2733
Myrtle Beach, SC............................................. 15.0700
Naples, FL................................................... 18.6860
Nashville, TN................................................ 17.5408
Nassau-Suffolk, NY........................................... 25.7257
New Haven-Bridgeport-Stamford-...............................
Danbury-Waterbury, CT........................................ 23.7262
New London-Norwich, CT....................................... 22.5252
New Orleans, LA.............................................. 17.8955
New York, NY................................................. 26.1508
Newark, NJ................................................... 22.5401
Newburgh, NY-PA.............................................. 20.1006
Norfolk-Virginia Beach-Newport News, VA-NC................... 15.9211
Oakland, CA.................................................. 28.7763
Ocala, FL.................................................... 16.9266
Odessa-Midland, TX........................................... 16.5687
Oklahoma City, OK............................................ 15.8211
Olympia, WA.................................................. 21.0283
Omaha, NE-IA................................................. 18.5393
Orange County, CA............................................ 23.2815
Orlando, FL.................................................. 18.0111
Owensboro, KY................................................ 14.1939
Panama City, FL.............................................. 15.4882
Parkersburg-Marietta, WV-OH.................................. 14.6723
Pensacola, FL................................................ 15.4904
Peoria-Pekin, IL............................................. 16.3153
Philadelphia, PA-NJ.......................................... 21.0452
Phoenix-Mesa, AZ............................................. 18.5670
Pine Bluff, AR............................................... 15.1147
Pittsburgh, PA............................................... 18.4432
Pittsfield, MA............................................... 20.5161
Ponce, PR.................................................... 9.0479
Portland, ME................................................. 18.4457
Portland-Vancouver, OR-WA.................................... 21.2923
Providence-Warwick, RI....................................... 20.8739
Provo-Orem, UT............................................... 18.6323
Pueblo, CO................................................... 16.1052
Punta Gorda, FL.............................................. 17.7975
Racine, WI................................................... 16.4769
Raleigh-Durham-Chapel Hill, NC............................... 18.0562
Rapid City, SD............................................... 15.6494
Reading, PA.................................................. 18.1153
Redding, CA.................................................. 22.3298
Reno, NV..................................................... 20.9876
Richland-Kennewick-Pasco, WA................................. 18.9500
Richmond-Petersburg, VA...................................... 17.1415
Riverside-San Bernardino, CA................................. 21.9893
Roanoke, VA.................................................. 16.0589
Rochester, MN................................................ 19.9607
Rochester, NY................................................ 18.1442
Rockford, IL................................................. 16.7939
Rocky Mount, NC.............................................. 16.5823
Sacramento, CA............................................... 23.7352
Saginaw-Bay City-Midland, MI................................. 17.9615
St Cloud, MN................................................. 18.0754
St Joseph, MO................................................ 16.0095
St Louis, MO-IL.............................................. 16.8087
Salem, OR.................................................... 18.1534
Salinas, CA.................................................. 26.9989
Salt Lake City-Ogden, UT..................................... 18.3253
San Angelo, TX............................................... 14.7224
San Antonio, TX.............................................. 15.9267
San Diego, CA................................................ 22.4200
San Francisco, CA............................................ 27.2835
San Jose, CA................................................. 27.3139
San Juan-Bayamon, PR......................................... 8.5450
San Luis Obispo-Atascadero-Paso Robles, CA................... 21.5899
Santa Barbara-Santa Maria-Lompoc, CA......................... 21.0804
Santa Cruz-Watsonville, CA................................... 26.3954
Santa Fe, NM................................................. 21.0277
Santa Rosa, CA............................................... 24.0268
Sarasota-Bradenton, FL....................................... 18.4321
Savannah, GA................................................. 16.9751
Scranton-Wilkes Barre-Hazleton, PA........................... 16.5137
Seattle-Bellevue-Everett, WA................................. 21.3995
Sharon, PA................................................... 16.8537
Sheboygan, WI................................................ 15.1072
Sherman-Denison, TX.......................................... 16.6210
Shreveport-Bossier City, LA.................................. 17.0508
Sioux City, IA-NE............................................ 15.9684
Sioux Falls, SD.............................................. 16.5847
South Bend,IN................................................ 17.9364
Spokane, WA.................................................. 19.6432
Springfield, IL.............................................. 16.9223
Springfield, MO.............................................. 14.9476
Springfield, MA.............................................. 19.9089
State College, PA............................................ 19.2360
Steubenville-Weirton, OH-WV.................................. 16.0044
Stockton-Lodi, CA............................................ 21.8377
Sumter, SC................................................... 15.7945
Syracuse, NY................................................. 18.0411
Tacoma, WA................................................... 20.4969
Tallahassee, FL.............................................. 15.7519
Tampa-St Petersburg-Clearwater, FL........................... 17.5324
Terre Haute, IN.............................................. 16.4157
Texarkana, TX-Texarkana, AR.................................. 15.5180
Toledo, OH................................................... 19.7316
Topeka, KS................................................... 18.4279
Trenton, NJ.................................................. 18.9912
Tucson, AZ................................................... 17.5838
Tulsa, OK.................................................... 15.6073
Tuscaloosa, AL............................................... 15.3144
Tyler, TX.................................................... 17.8508
Utica-Rome, NY............................................... 16.1173
Vallejo-Fairfield-Napa, CA................................... 25.5228
Ventura, CA.................................................. 22.5710
Victoria, TX................................................. 15.9679
Vineland-Millville-Bridgeton, NJ............................. 18.8648
Visalia-Tulare-Porterville, CA............................... 19.7741
Waco, TX..................................................... 14.9500
Washington, DC-MD-VA-WV...................................... 20.9642
Waterloo-Cedar Falls, IA..................................... 16.2799
Wausau, WI................................................... 18.9938
West Palm Beach-Boca Raton, FL............................... 19.3398
Wheeling, WV-OH.............................................. 14.2319
Wichita, KS.................................................. 18.0997
Wichita Falls, TX............................................ 14.6944
Williamsport, PA............................................. 16.1054
Wilmington-Newark, DE-MD..................................... 21.8419
Wilmington, NC............................................... 17.6028
Yakima, WA................................................... 18.8374
Yolo, CA..................................................... 21.9861
York, PA..................................................... 17.3484
Youngstown-Warren, OH........................................ 18.0869
Yuba City, CA................................................ 20.0865
Yuma, AZ..................................................... 18.4923
------------------------------------------------------------------------
Table 4e.--Average Hourly Wage for Rural Areas
------------------------------------------------------------------------
Average
Nonurban area hourly
wage
------------------------------------------------------------------------
Alabama...................................................... 13.5615
Alaska....................................................... 22.7793
Arizona...................................................... 15.1344
Arkansas..................................................... 13.0557
California................................................... 19.1114
Colorado..................................................... 15.1209
Connecticut.................................................. 24.8299
Delaware..................................................... 17.0720
Florida...................................................... 16.4079
Georgia...................................................... 14.6148
Hawaii....................................................... 18.6401
Idaho........................................................ 15.8589
Illinois..................................................... 14.1915
Indiana...................................................... 15.2704
Iowa......................................................... 13.9176
Kansas....................................................... 13.6838
Kentucky..................................................... 14.4809
Louisiana.................................................... 13.7719
Maine........................................................ 15.9481
Maryland..................................................... 16.0195
Massachusetts................................................ 20.0223
Michigan..................................................... 16.5516
Minnesota.................................................... 15.3842
Mississippi.................................................. 12.6771
Missouri..................................................... 13.6029
Montana...................................................... 15.3151
Nebraska..................................................... 13.6661
[[Page 45893]]
Nevada....................................................... 16.6350
New Hampshire................................................ 18.9536
New Jersey \1\............................................... .........
New Mexico................................................... 15.7665
New York..................................................... 16.3687
North Carolina............................................... 15.1058
North Dakota................................................. 13.7514
Ohio......................................................... 15.6847
Oklahoma..................................................... 13.2228
Oregon....................................................... 17.9571
Pennsylvania................................................. 16.1301
Puerto Rico.................................................. 8.1889
Rhode Island \1\............................................. .........
South Carolina............................................... 14.6476
South Dakota................................................. 13.2255
Tennessee.................................................... 14.0250
Texas........................................................ 13.8226
Utah......................................................... 16.3774
Vermont...................................................... 17.1172
Virginia..................................................... 14.7420
Washington................................................... 18.5043
West Virginia................................................ 15.2110
Wisconsin.................................................... 15.8839
Wyoming...................................................... 15.1685
------------------------------------------------------------------------
\1\ All counties within the State are classified urban.
Table 5.--List of Diagnosis Related Groups (DRGS), Relative Weighting Factors, Geometric Mean Length of Stay,
and Length of Stay Outlier Cutoff Points Used in the Prospective Payment System
----------------------------------------------------------------------------------------------------------------
Relative Geometric Arithmetic Outlier
weights mean LOS mean LOS threshold
----------------------------------------------------------------------------------------------------------------
1....... 01 SURG CRANIOTOMY AGE >17 EXCEPT FOR 3.0932 8.7 12.4 32
TRAUMA.
2....... 01 SURG CRANIOTOMY FOR TRAUMA AGE >17.. 3.0095 9.0 12.6 32
3....... 01 SURG *CRANIOTOMY AGE 0-17........... 1.8848 12.7 12.7 36
4....... 01 SURG SPINAL PROCEDURES.............. 2.3296 6.5 10.0 29
5....... 01 SURG EXTRACRANIAL VASCULAR 1.5798 4.0 5.2 27
PROCEDURES.
6....... 01 SURG CARPAL TUNNEL RELEASE.......... .8124 2.4 4.0 25
7....... 01 SURG PERIPH & CRANIAL NERVE & OTHER 2.6017 9.3 14.7 32
NERV SYST PROC W CC.
8....... 01 SURG PERIPH & CRANIAL NERVE & OTHER 1.1794 3.1 4.6 26
NERV SYST PROC W/O CC.
9....... 01 MED SPINAL DISORDERS & INJURIES.... 1.3047 5.7 8.5 29
10...... 01 MED NERVOUS SYSTEM NEOPLASMS W CC.. 1.2299 6.2 8.9 29
11...... 01 MED NERVOUS SYSTEM NEOPLASMS W/O CC .8000 3.8 5.3 27
12...... 01 MED DEGENERATIVE NERVOUS SYSTEM .9891 6.0 8.7 29
DISORDERS.
13...... 01 MED MULTIPLE SCLEROSIS & CEREBELLAR .7858 5.4 6.9 28
ATAXIA.
14...... 01 MED SPECIFIC CEREBROVASCULAR 1.2065 6.0 8.2 29
DISORDERS EXCEPT TIA.
15...... 01 MED TRANSIENT ISCHEMIC ATTACK & .7227 3.8 4.9 27
PRECEREBRAL OCCLUSIONS.
16...... 01 MED NONSPECIFIC CEREBROVASCULAR 1.0639 5.4 7.4 28
DISORDERS W CC.
17...... 01 MED NONSPECIFIC CEREBROVASCULAR .6026 3.2 4.3 26
DISORDERS W/O CC.
18...... 01 MED CRANIAL & PERIPHERAL NERVE .9242 5.1 6.9 28
DISORDERS W CC.
19...... 01 MED CRANIAL & PERIPHERAL NERVE .5990 3.6 4.7 27
DISORDERS W/O CC.
20...... 01 MED NERVOUS SYSTEM INFECTION EXCEPT 2.1157 8.3 11.5 31
VIRAL MENINGITIS.
21...... 01 MED VIRAL MENINGITIS............... 1.5350 6.5 8.7 30
22...... 01 MED HYPERTENSIVE ENCEPHALOPATHY.... .8127 4.0 5.1 27
23...... 01 MED NONTRAUMATIC STUPOR & COMA..... .8090 3.9 5.5 27
24...... 01 MED SEIZURE & HEADACHE AGE >17 W CC .9908 4.6 6.5 28
25...... 01 MED SEIZURE & HEADACHE AGE >17 W/O .5681 3.1 4.1 26
CC.
26...... 01 MED SEIZURE & HEADACHE AGE 0-17.... .8993 3.1 4.5 26
27...... 01 MED TRAUMATIC STUPOR & COMA, COMA 1.3476 3.9 7.2 27
>1 HR.
28...... 01 MED TRAUMATIC STUPOR & COMA, COMA 1.2001 5.2 7.9 28
<1 HR AGE >17 W CC.
29...... 01 MED TRAUMATIC STUPOR & COMA, COMA .6217 3.1 4.4 26
<1 HR AGE >17 W/O CC.
30...... 01 MED *TRAUMATIC STUPOR & COMA, COMA .3187 2.0 2.0 17
<1 HR AGE 0-17.
31...... 01 MED CONCUSSION AGE >17 W CC........ .7934 3.8 5.7 27
32...... 01 MED CONCUSSION AGE >17 W/O CC...... .4819 2.4 3.3 22
33...... 01 MED *CONCUSSION AGE 0-17........... .2003 1.6 1.6 9
34...... 01 MED OTHER DISORDERS OF NERVOUS 1.0569 4.9 6.9 28
SYSTEM W CC.
35...... 01 MED OTHER DISORDERS OF NERVOUS .5914 3.4 4.8 26
SYSTEM W/O CC.
36...... 02 SURG RETINAL PROCEDURES............. .5930 1.4 1.7 7
37...... 02 SURG ORBITAL PROCEDURES............. .8821 2.6 4.1 26
38...... 02 SURG PRIMARY IRIS PROCEDURES........ .4243 2.0 2.7 17
39...... 02 SURG LENS PROCEDURES WITH OR WITHOUT .5036 1.5 1.9 9
VITRECTOMY.
40...... 02 SURG EXTRAOCULAR PROCEDURES EXCEPT .7000 2.3 3.6 25
ORBIT AGE >17.
41...... 02 SURG *EXTRAOCULAR PROCEDURES EXCEPT .3244 1.6 1.6 7
ORBIT AGE 0-17.
[[Page 45894]]
42...... 02 SURG INTRAOCULAR PROCEDURES EXCEPT .5615 1.6 2.2 12
RETINA, IRIS & LENS.
43...... 02 MED HYPHEMA........................ .3665 3.0 3.8 25
44...... 02 MED ACUTE MAJOR EYE INFECTIONS..... .6150 4.8 5.9 28
45...... 02 MED NEUROLOGICAL EYE DISORDERS..... .6460 3.4 4.3 25
46...... 02 MED OTHER DISORDERS OF THE EYE AGE .7593 4.2 5.9 27
>17 W CC.
47...... 02 MED OTHER DISORDERS OF THE EYE AGE .4539 3.0 4.0 26
>17 W/O CC.
48...... 02 MED *OTHER DISORDERS OF THE EYE AGE .2859 2.9 2.9 26
0-17.
49...... 03 SURG MAJOR HEAD & NECK PROCEDURES... 1.7701 4.7 7.0 28
50...... 03 SURG SIALOADENECTOMY................ .7522 1.8 2.4 12
51...... 03 SURG SALIVARY GLAND PROCEDURES .7325 2.0 3.0 23
EXCEPT SIALOADENECTOMY.
52...... 03 SURG CLEFT LIP & PALATE REPAIR...... .8492 2.4 3.4 25
53...... 03 SURG SINUS & MASTOID PROCEDURES AGE .9392 2.3 3.7 25
>17.
54...... 03 SURG *SINUS & MASTOID PROCEDURES AGE .4634 3.2 3.2 22
0-17.
55...... 03 SURG MISCELLANEOUS EAR, NOSE, MOUTH .7238 1.9 3.0 22
& THROAT PROCEDURES.
56...... 03 SURG RHINOPLASTY.................... .8195 2.1 3.0 21
57...... 03 SURG T&A PROC, EXCEPT TONSILLECTOMY 1.0450 3.2 4.9 26
&/OR ADENOIDECTOMY ONLY, AGE
>17.
58...... 03 SURG *T&A PROC, EXCEPT TONSILLECTOMY .2631 1.5 1.5 4
&/OR ADENOIDECTOMY ONLY, AGE 0-
17.
59...... 03 SURG TONSILLECTOMY &/OR .5963 2.1 2.9 19
ADENOIDECTOMY ONLY, AGE >17.
60...... 03 SURG *TONSILLECTOMY &/OR .2004 1.5 1.5 4
ADENOIDECTOMY ONLY, AGE 0-17.
61...... 03 SURG MYRINGOTOMY W TUBE INSERTION 1.2221 3.1 5.9 26
AGE >17.
62...... 03 SURG *MYRINGOTOMY W TUBE INSERTION .2837 1.3 1.3 5
AGE 0-17.
63...... 03 SURG OTHER EAR, NOSE, MOUTH & THROAT 1.1462 3.3 4.9 26
O.R. PROCEDURES.
64...... 03 MED EAR, NOSE, MOUTH & THROAT 1.1887 5.1 8.2 28
MALIGNANCY.
65...... 03 MED DYSEQUILIBRIUM................. .5162 2.9 3.7 22
66...... 03 MED EPISTAXIS...................... .5306 3.0 3.9 24
67...... 03 MED EPIGLOTTITIS................... .8060 3.4 4.3 25
68...... 03 MED OTITIS MEDIA & URI AGE >17 W CC .7094 4.2 5.2 27
69...... 03 MED OTITIS MEDIA & URI AGE >17 W/O .5270 3.4 4.1 21
CC.
70...... 03 MED OTITIS MEDIA & URI AGE 0-17.... .3129 2.4 3.0 17
71...... 03 MED LARYNGOTRACHEITIS.............. .7206 3.6 4.4 25
72...... 03 MED NASAL TRAUMA & DEFORMITY....... .6419 3.0 4.7 26
73...... 03 MED OTHER EAR, NOSE, MOUTH & THROAT .7730 4.0 5.4 27
DIAGNOSES AGE >17.
74...... 03 MED *OTHER EAR, NOSE, MOUTH & .3223 2.1 2.1 20
THROAT DIAGNOSES AGE 0-17.
75...... 04 SURG MAJOR CHEST PROCEDURES......... 3.1034 9.3 11.9 32
76...... 04 SURG OTHER RESP SYSTEM O.R. 2.5601 9.6 13.4 33
PROCEDURES W CC.
77...... 04 SURG OTHER RESP SYSTEM O.R. 1.1219 3.9 5.9 27
PROCEDURES W/O CC.
78...... 04 MED PULMONARY EMBOLISM............. 1.4136 7.4 8.8 30
79...... 04 MED RESPIRATORY INFECTIONS & 1.6625 7.8 10.1 31
INFLAMMATIONS AGE >17 W CC.
80...... 04 MED RESPIRATORY INFECTIONS & .9508 5.7 7.2 29
INFLAMMATIONS AGE >17 W/O CC.
81...... 04 MED RESPIRATORY INFECTIONS & .9558 4.7 6.7 28
INFLAMMATIONS AGE 0-17.
82...... 04 MED RESPIRATORY NEOPLASMS.......... 1.3166 6.0 8.4 29
83...... 04 MED MAJOR CHEST TRAUMA W CC........ .9557 5.2 6.9 28
84...... 04 MED MAJOR CHEST TRAUMA W/O CC...... .5002 3.0 4.2 25
85...... 04 MED PLEURAL EFFUSION W CC.......... 1.1917 5.9 7.9 29
86...... 04 MED PLEURAL EFFUSION W/O CC........ .6848 3.6 4.6 27
87...... 04 MED PULMONARY EDEMA & RESPIRATORY 1.3589 5.3 7.3 28
FAILURE.
88...... 04 MED CHRONIC OBSTRUCTIVE PULMONARY 1.0018 5.3 6.6 28
DISEASE.
89...... 04 MED SIMPLE PNEUMONIA & PLEURISY AGE 1.1211 6.2 7.6 29
>17 W CC.
90...... 04 MED SIMPLE PNEUMONIA & PLEURISY AGE .6996 4.7 5.5 26
>17 W/O CC.
91...... 04 MED SIMPLE PNEUMONIA & PLEURISY AGE .8366 4.4 6.0 27
0-17.
92...... 04 MED INTERSTITIAL LUNG DISEASE W CC. 1.2000 6.0 7.7 29
93...... 04 MED INTERSTITIAL LUNG DISEASE W/O .7550 4.2 5.3 27
CC.
94...... 04 MED PNEUMOTHORAX W CC.............. 1.2378 6.2 8.1 29
95...... 04 MED PNEUMOTHORAX W/O CC............ .6242 3.8 4.7 26
96...... 04 MED BRONCHITIS & ASTHMA AGE >17 W .8390 4.9 5.9 28
CC.
97...... 04 MED BRONCHITIS & ASTHMA AGE >17 W/O .6089 3.8 4.6 23
CC.
98...... 04 MED BRONCHITIS & ASTHMA AGE 0-17... .6696 4.2 5.1 27
[[Page 45895]]
99...... 04 MED RESPIRATORY SIGNS & SYMPTOMS W .6959 2.9 3.9 26
CC.
100..... 04 MED RESPIRATORY SIGNS & SYMPTOMS W/ .5034 2.1 2.6 14
O CC.
101..... 04 MED OTHER RESPIRATORY SYSTEM .9120 4.5 6.0 27
DIAGNOSES W CC.
102..... 04 MED OTHER RESPIRATORY SYSTEM .5595 2.9 4.0 26
DIAGNOSES W/O CC.
103..... 05 SURG HEART TRANSPLANT............... 13.8273 27.4 39.1 50
104..... 05 SURG CARDIAC VALVE PROCEDURES W 7.3143 13.3 16.0 36
CARDIAC CATH.
105..... 05 SURG CARDIAC VALVE PROCEDURES W/O 5.6310 10.0 12.0 33
CARDIAC CATH.
106..... 05 SURG CORONARY BYPASS W CARDIAC CATH. 5.6187 11.2 12.7 34
107..... 05 SURG CORONARY BYPASS W/O CARDIAC 4.1803 8.6 9.8 32
CATH.
108..... 05 SURG OTHER CARDIOTHORACIC PROCEDURES 5.9455 10.5 13.5 33
109..... NO LONGER VALID................ .0000 .0 .0 0
110..... 05 SURG MAJOR CARDIOVASCULAR PROCEDURES 4.1308 8.7 11.6 32
W CC.
111..... 05 SURG MAJOR CARDIOVASCULAR PROCEDURES 2.2584 6.3 7.2 29
W/O CC.
112..... 05 SURG PERCUTANEOUS CARDIOVASCULAR 1.9922 3.6 5.0 27
PROCEDURES.
113..... 05 SURG AMPUTATION FOR CIRC SYSTEM 2.7536 11.6 16.0 35
DISORDERS EXCEPT UPPER LIMB &
TOE.
114..... 05 SURG UPPER LIMB & TOE AMPUTATION FOR 1.5383 7.4 10.5 30
CIRC SYSTEM DISORDERS.
115..... 05 SURG PERM CARDIAC PACEMAKER IMPLANT 3.5513 9.5 11.8 33
W AMI, HEART FAILURE OR SHOCK.
116..... 05 SURG OTH PERM CARDIAC PACEMAKER 2.3949 4.2 5.9 27
IMPLANT OR AICD LEAD OR
GENERATOR PROC.
117..... 05 SURG CARDIAC PACEMAKER REVISION 1.1454 3.0 4.5 26
EXCEPT DEVICE REPLACEMENT.
118..... 05 SURG CARDIAC PACEMAKER DEVICE 1.5260 2.2 3.4 25
REPLACEMENT.
119..... 05 SURG VEIN LIGATION & STRIPPING...... 1.1247 3.4 5.9 26
120..... 05 SURG OTHER CIRCULATORY SYSTEM O.R. 1.9531 5.8 10.1 29
PROCEDURES.
121..... 05 MED CIRCULATORY DISORDERS W AMI & 1.6459 7.0 8.4 30
C.V. COMP DISCH ALIVE.
122..... 05 MED CIRCULATORY DISORDERS W AMI W/O 1.1614 4.9 5.8 28
C.V. COMP DISCH ALIVE.
123..... 05 MED CIRCULATORY DISORDERS W AMI, 1.4370 2.8 4.9 26
EXPIRED.
124..... 05 MED CIRCULATORY DISORDERS EXCEPT 1.2933 4.0 5.3 27
AMI, W CARD CATH & COMPLEX
DIAG.
125..... 05 MED CIRCULATORY DISORDERS EXCEPT .8767 2.4 3.2 22
AMI, W CARD CATH W/O COMPLEX
DIAG.
126..... 05 MED ACUTE & SUBACUTE ENDOCARDITIS.. 2.6049 12.3 16.3 35
127..... 05 MED HEART FAILURE & SHOCK.......... 1.0302 5.2 6.7 28
128..... 05 MED DEEP VEIN THROMBOPHLEBITIS..... .7929 6.3 7.2 29
129..... 05 MED CARDIAC ARREST, UNEXPLAINED.... 1.1376 2.1 3.7 25
130..... 05 MED PERIPHERAL VASCULAR DISORDERS W .9384 5.6 7.2 29
CC.
131..... 05 MED PERIPHERAL VASCULAR DISORDERS W/ .6002 4.5 5.5 27
O CC.
132..... 05 MED ATHEROSCLEROSIS W CC........... .6861 3.1 4.0 23
133..... 05 MED ATHEROSCLEROSIS W/O CC......... .5347 2.5 3.1 18
134..... 05 MED HYPERTENSION................... .5800 3.3 4.2 25
135..... 05 MED CARDIAC CONGENITAL & VALVULAR .8988 4.1 5.7 27
DISORDERS AGE >17 W CC.
136..... 05 MED CARDIAC CONGENITAL & VALVULAR .5789 2.8 3.6 22
DISORDERS AGE >17 W/O CC.
137..... 05 MED *CARDIAC CONGENITAL & VALVULAR .7866 3.3 3.3 26
DISORDERS AGE 0-17.
138..... 05 MED CARDIAC ARRHYTHMIA & CONDUCTION .8049 3.7 5.0 27
DISORDERS W CC.
139..... 05 MED CARDIAC ARRHYTHMIA & CONDUCTION .4945 2.5 3.2 18
DISORDERS W/O CC.
140..... 05 MED ANGINA PECTORIS................ .6312 3.1 3.8 22
141..... 05 MED SYNCOPE & COLLAPSE W CC........ .7149 3.7 5.0 27
142..... 05 MED SYNCOPE & COLLAPSE W/O CC...... .5216 2.7 3.5 20
143..... 05 MED CHEST PAIN..................... .5159 2.3 2.8 15
144..... 05 MED OTHER CIRCULATORY SYSTEM 1.0689 4.3 6.1 27
DIAGNOSES W CC.
145..... 05 MED OTHER CIRCULATORY SYSTEM .6204 2.7 3.5 22
DIAGNOSES W/O CC.
146..... 06 SURG RECTAL RESECTION W CC.......... 2.5898 10.2 11.8 33
147..... 06 SURG RECTAL RESECTION W/O CC........ 1.5368 7.2 7.9 29
148..... 06 SURG MAJOR SMALL & LARGE BOWEL 3.3264 11.7 14.2 35
PROCEDURES W CC.
149..... 06 SURG MAJOR SMALL & LARGE BOWEL 1.5654 7.4 8.1 26
PROCEDURES W/O CC.
150..... 06 SURG PERITONEAL ADHESIOLYSIS W CC... 2.6561 10.1 12.4 33
151..... 06 SURG PERITONEAL ADHESIOLYSIS W/O CC. 1.2606 5.5 6.8 29
152..... 06 SURG MINOR SMALL & LARGE BOWEL 1.8860 8.0 9.7 31
PROCEDURES W CC.
[[Page 45896]]
153..... 06 SURG MINOR SMALL & LARGE BOWEL 1.1257 5.7 6.4 26
PROCEDURES W/O CC.
154..... 06 SURG STOMACH, ESOPHAGEAL & DUODENAL 4.2102 12.6 16.1 36
PROCEDURES AGE >17 W CC.
155..... 06 SURG STOMACH, ESOPHAGEAL & DUODENAL 1.3885 5.4 6.7 28
PROCEDURES AGE >17 W/O CC.
156..... 06 SURG *STOMACH, ESOPHAGEAL & DUODENAL .8101 6.0 6.0 29
PROCEDURES AGE 0-17.
157..... 06 SURG ANAL & STOMAL PROCEDURES W CC.. 1.1048 4.3 6.1 27
158..... 06 SURG ANAL & STOMAL PROCEDURES W/O CC .5789 2.3 3.0 18
159..... 06 SURG HERNIA PROCEDURES EXCEPT 1.1707 4.1 5.6 27
INGUINAL & FEMORAL AGE >17 W
CC.
160..... 06 SURG HERNIA PROCEDURES EXCEPT .6746 2.5 3.1 17
INGUINAL & FEMORAL AGE >17 W/O
CC.
161..... 06 SURG INGUINAL & FEMORAL HERNIA .9554 3.1 4.5 26
PROCEDURES AGE >17 W CC.
162..... 06 SURG INGUINAL & FEMORAL HERNIA .5365 1.8 2.2 11
PROCEDURES AGE >17 W/O CC.
163..... 06 SURG HERNIA PROCEDURES AGE 0-17..... .7578 3.5 5.0 27
164..... 06 SURG APPENDECTOMY W COMPLICATED 2.2374 8.5 9.9 31
PRINCIPAL DIAG W CC.
165..... 06 SURG APPENDECTOMY W COMPLICATED 1.2365 5.3 6.1 25
PRINCIPAL DIAG W/O CC.
166..... 06 SURG APPENDECTOMY W/O COMPLICATED 1.3695 4.9 6.1 28
PRINCIPAL DIAG W CC.
167..... 06 SURG APPENDECTOMY W/O COMPLICATED .7892 3.0 3.6 16
PRINCIPAL DIAG W/O CC.
168..... 03 SURG MOUTH PROCEDURES W CC.......... 1.1761 3.6 5.6 27
169..... 03 SURG MOUTH PROCEDURES W/O CC........ .6434 2.0 2.7 17
170..... 06 SURG OTHER DIGESTIVE SYSTEM O.R. 2.7116 9.1 13.3 32
PROCEDURES W CC.
171..... 06 SURG OTHER DIGESTIVE SYSTEM O.R. 1.1628 4.4 6.2 27
PROCEDURES W/O CC.
172..... 06 MED DIGESTIVE MALIGNANCY W CC...... 1.2898 6.1 8.8 29
173..... 06 MED DIGESTIVE MALIGNANCY W/O CC.... .6569 3.2 4.6 26
174..... 06 MED G.I. HEMORRHAGE W CC........... .9880 4.7 6.0 28
175..... 06 MED G.I. HEMORRHAGE W/O CC......... .5457 3.1 3.8 19
176..... 06 MED COMPLICATED PEPTIC ULCER....... 1.0563 5.0 6.5 28
177..... 06 MED UNCOMPLICATED PEPTIC ULCER W CC .8270 4.4 5.4 27
178..... 06 MED UNCOMPLICATED PEPTIC ULCER W/O .5990 3.2 3.9 21
CC.
179..... 06 MED INFLAMMATORY BOWEL DISEASE..... 1.0993 6.0 7.8 29
180..... 06 MED G.I. OBSTRUCTION W CC.......... .9240 5.0 6.5 28
181..... 06 MED G.I. OBSTRUCTION W/O CC........ .5231 3.4 4.2 23
182..... 06 MED ESOPHAGITIS, GASTROENT & MISC .7794 4.1 5.4 27
DIGEST DISORDERS AGE >17 W CC.
183..... 06 MED ESOPHAGITIS, GASTROENT & MISC .5480 3.0 3.7 22
DIGEST DISORDERS AGE >17 W/O
CC.
184..... 06 MED ESOPHAGITIS, GASTROENT & MISC .3910 2.5 3.1 18
DIGEST DISORDERS AGE 0-17.
185..... 03 MED DENTAL & ORAL DIS EXCEPT .8892 4.1 5.8 27
EXTRACTIONS & RESTORATIONS,
AGE >17.
186..... 03 MED *DENTAL & ORAL DIS EXCEPT .3088 2.9 2.9 23
EXTRACTIONS & RESTORATIONS,
AGE 0-17.
187..... 03 MED DENTAL EXTRACTIONS & .6473 2.8 3.8 26
RESTORATIONS.
188..... 06 MED OTHER DIGESTIVE SYSTEM 1.0458 4.7 6.6 28
DIAGNOSES AGE >17 W CC.
189..... 06 MED OTHER DIGESTIVE SYSTEM .5438 2.8 3.8 26
DIAGNOSES AGE >17 W/O CC.
190..... 06 MED OTHER DIGESTIVE SYSTEM 1.2379 4.6 6.5 28
DIAGNOSES AGE 0-17.
191..... 07 SURG PANCREAS, LIVER & SHUNT 4.4495 12.9 17.5 36
PROCEDURES W CC.
192..... 07 SURG PANCREAS, LIVER & SHUNT 1.7103 6.4 8.3 29
PROCEDURES W/O CC.
193..... 07 SURG BILIARY TRACT PROC EXCEPT ONLY 3.2131 12.3 14.9 35
CHOLECYST W OR W/O C.D.E. W CC.
194..... 07 SURG BILIARY TRACT PROC EXCEPT ONLY 1.6937 6.9 8.6 30
CHOLECYST W OR W/O C.D.E. W/O
CC.
195..... 07 SURG CHOLECYSTECTOMY W C.D.E. W CC.. 2.6147 9.4 11.2 32
196..... 07 SURG CHOLECYSTECTOMY W C.D.E. W/O CC 1.5695 6.2 7.2 29
197..... 07 SURG CHOLECYSTECTOMY EXCEPT BY 2.2034 7.9 9.7 31
LAPAROSCOPE W/O C.D.E. W CC.
198..... 07 SURG CHOLECYSTECTOMY EXCEPT BY 1.1355 4.6 5.4 24
LAPAROSCOPE W/O C.D.E. W/O CC.
[[Page 45897]]
199..... 07 SURG HEPATOBILIARY DIAGNOSTIC 2.3309 9.2 12.4 32
PROCEDURE FOR MALIGNANCY.
200..... 07 SURG HEPATOBILIARY DIAGNOSTIC 3.0158 7.9 12.7 31
PROCEDURE FOR NON-MALIGNANCY.
201..... 07 SURG OTHER HEPATOBILIARY OR PANCREAS 3.2951 11.7 16.1 35
O.R. PROCEDURES.
202..... 07 MED CIRRHOSIS & ALCOHOLIC HEPATITIS 1.3177 6.1 8.3 29
203..... 07 MED MALIGNANCY OF HEPATOBILIARY 1.2187 5.9 8.3 29
SYSTEM OR PANCREAS.
204..... 07 MED DISORDERS OF PANCREAS EXCEPT 1.2020 5.5 7.2 28
MALIGNANCY.
205..... 07 MED DISORDERS OF LIVER EXCEPT 1.2276 5.8 8.0 29
MALIG, CIRR, ALC HEPA W CC.
206..... 07 MED DISORDERS OF LIVER EXCEPT .6801 3.6 5.0 27
MALIG, CIRR, ALC HEPA W/O CC.
207..... 07 MED DISORDERS OF THE BILIARY TRACT 1.0287 4.7 6.2 28
W CC.
208..... 07 MED DISORDERS OF THE BILIARY TRACT .5943 2.8 3.6 23
W/O CC.
209..... 08 SURG MAJOR JOINT & LIMB REATTACHMENT 2.2707 6.8 7.6 27
PROCEDURES OF LOWER EXTREMITY.
210..... 08 SURG HIP & FEMUR PROCEDURES EXCEPT 1.8616 8.2 9.8 31
MAJOR JOINT AGE >17 W CC.
211..... 08 SURG HIP & FEMUR PROCEDURES EXCEPT 1.2893 6.3 7.2 28
MAJOR JOINT AGE >17 W/O CC.
212..... 08 SURG HIP & FEMUR PROCEDURES EXCEPT 1.1296 4.3 5.2 27
MAJOR JOINT AGE 0-17.
213..... 08 SURG AMPUTATION FOR MUSCULOSKELETAL 1.7196 7.6 10.6 31
SYSTEM & CONN TISSUE DISORDERS.
214..... 08 SURG BACK & NECK PROCEDURES W CC.... 1.9184 5.7 7.4 29
215..... 08 SURG BACK & NECK PROCEDURES W/O CC.. 1.0924 3.5 4.2 22
216..... 08 SURG BIOPSIES OF MUSCULOSKELETAL 2.1075 8.6 12.2 32
SYSTEM & CONNECTIVE TISSUE.
217..... 08 SURG WND DEBRID & SKN GRFT EXCEPT 2.8975 11.1 17.1 34
HAND, FOR MUSCSKELET & CONN
TISS DIS.
218..... 08 SURG LOWER EXTREM & HUMER PROC 1.4231 5.3 6.9 28
EXCEPT HIP, FOOT, FEMUR AGE
>17 W CC.
219..... 08 SURG LOWER EXTREM & HUMER PROC .9179 3.4 4.1 22
EXCEPT HIP, FOOT, FEMUR AGE
>17 W/O CC.
220..... 08 SURG *LOWER EXTREM & HUMER PROC .5611 5.3 5.3 28
EXCEPT HIP, FOOT, FEMUR AGE 0-
17.
221..... 08 SURG KNEE PROCEDURES W CC........... 1.8463 6.3 8.8 29
222..... 08 SURG KNEE PROCEDURES W/O CC......... .9747 3.3 4.2 26
223..... 08 SURG MAJOR SHOULDER/ELBOW PROC, OR .8364 2.3 3.0 17
OTHER UPPER EXTREMITY PROC W
CC.
224..... 08 SURG SHOULDER, ELBOW OR FOREARM .6983 2.0 2.4 11
PROC, EXC MAJOR JOINT PROC, W/
O CC.
225..... 08 SURG FOOT PROCEDURES................ .9504 3.3 5.1 26
226..... 08 SURG SOFT TISSUE PROCEDURES W CC.... 1.3656 4.7 7.3 28
227..... 08 SURG SOFT TISSUE PROCEDURES W/O CC.. .7273 2.4 3.2 20
228..... 08 SURG MAJOR THUMB OR JOINT PROC, OR .9315 2.4 3.8 25
OTH HAND OR WRIST PROC W CC.
229..... 08 SURG HAND OR WRIST PROC, EXCEPT .5965 1.8 2.4 14
MAJOR JOINT PROC, W/O CC.
230..... 08 SURG LOCAL EXCISION & REMOVAL OF INT 1.0399 3.5 5.6 27
FIX DEVICES OF HIP & FEMUR.
231..... 08 SURG LOCAL EXCISION & REMOVAL OF INT 1.2131 3.5 5.5 26
FIX DEVICES EXCEPT HIP & FEMUR.
232..... 08 SURG ARTHROSCOPY.................... 1.0578 2.6 4.5 26
233..... 08 SURG OTHER MUSCULOSKELET SYS & CONN 1.9275 6.8 9.8 30
TISS O.R. PROC W CC.
234..... 08 SURG OTHER MUSCULOSKELET SYS & CONN 1.0039 3.3 4.5 26
TISS O.R. PROC W/O CC.
235..... 08 MED FRACTURES OF FEMUR............. .8501 5.2 7.8 28
236..... 08 MED FRACTURES OF HIP & PELVIS...... .7818 5.2 7.1 28
237..... 08 MED SPRAINS, STRAINS, & .5711 3.7 4.9 27
DISLOCATIONS OF HIP, PELVIS &
THIGH.
238..... 08 MED OSTEOMYELITIS.................. 1.4356 8.4 11.5 31
239..... 08 MED PATHOLOGICAL FRACTURES & 1.0219 6.3 8.4 29
MUSCULOSKELETAL & CONN TISS
MALIGNANCY.
240..... 08 MED CONNECTIVE TISSUE DISORDERS W 1.1900 5.9 8.1 29
CC.
241..... 08 MED CONNECTIVE TISSUE DISORDERS W/O .5986 3.8 4.9 27
CC.
242..... 08 MED SEPTIC ARTHRITIS............... 1.1295 6.7 9.0 30
[[Page 45898]]
243..... 08 MED MEDICAL BACK PROBLEMS.......... .7248 4.7 6.1 28
244..... 08 MED BONE DISEASES & SPECIFIC .7446 4.6 6.4 28
ARTHROPATHIES W CC.
245..... 08 MED BONE DISEASES & SPECIFIC .5050 3.4 4.6 26
ARTHROPATHIES W/O CC.
246..... 08 MED NON-SPECIFIC ARTHROPATHIES..... .5646 3.7 4.7 27
247..... 08 MED SIGNS & SYMPTOMS OF .5534 3.1 4.3 26
MUSCULOSKELETAL SYSTEM & CONN
TISSUE.
248..... 08 MED TENDONITIS, MYOSITIS & BURSITIS .7275 4.1 5.7 27
249..... 08 MED AFTERCARE, MUSCULOSKELETAL .6558 3.1 4.7 26
SYSTEM & CONNECTIVE TISSUE.
250..... 08 MED FX, SPRN, STRN & DISL OF .7193 3.9 5.7 27
FOREARM, HAND, FOOT AGE >17 W
CC.
251..... 08 MED FX, SPRN, STRN & DISL OF .4423 2.4 3.2 21
FOREARM, HAND, FOOT AGE >17 W/
O CC.
252..... 08 MED *FX, SPRN, STRN & DISL OF .2438 1.8 1.8 15
FOREARM, HAND, FOOT AGE 0-17.
253..... 08 MED FX, SPRN, STRN & DISL OF UPARM, .7637 4.7 6.6 28
LOWLEG EX FOOT AGE >17 W CC.
254..... 08 MED FX, SPRN, STRN & DISL OF UPARM, .4365 3.0 4.1 26
LOWLEG EX FOOT AGE >17 W/O CC.
255..... 08 MED *FX, SPRN, STRN & DISL OF .2838 2.9 2.9 26
UPARM, LOWLEG EX FOOT AGE 0-17.
256..... 08 MED OTHER MUSCULOSKELETAL SYSTEM & .6419 3.2 4.4 26
CONNECTIVE TISSUE DIAGNOSES.
257..... 09 SURG TOTAL MASTECTOMY FOR MALIGNANCY .8997 3.1 3.9 20
W CC.
258..... 09 SURG TOTAL MASTECTOMY FOR MALIGNANCY .6965 2.4 2.8 11
W/O CC.
259..... 09 SURG SUBTOTAL MASTECTOMY FOR .8765 2.6 4.1 26
MALIGNANCY W CC.
260..... 09 SURG SUBTOTAL MASTECTOMY FOR .5749 1.7 2.0 8
MALIGNANCY W/O CC.
261..... 09 SURG BREAST PROC FOR NON-MALIGNANCY .8080 1.9 2.6 13
EXCEPT BIOPSY & LOCAL EXCISION.
262..... 09 SURG BREAST BIOPSY & LOCAL EXCISION .7115 2.6 4.0 26
FOR NON-MALIGNANCY.
263..... 09 SURG SKIN GRAFT &/OR DEBRID FOR SKN 2.2344 11.2 15.8 34
ULCER OR CELLULITIS W CC.
264..... 09 SURG SKIN GRAFT &/OR DEBRID FOR SKN 1.1633 6.7 9.2 30
ULCER OR CELLULITIS W/O CC.
265..... 09 SURG SKIN GRAFT &/OR DEBRID EXCEPT 1.4131 4.9 7.9 28
FOR SKIN ULCER OR CELLULITIS W
CC.
266..... 09 SURG SKIN GRAFT &/OR DEBRID EXCEPT .7451 2.8 3.9 26
FOR SKIN ULCER OR CELLULITIS W/
O CC.
267..... 09 SURG PERIANAL & PILONIDAL PROCEDURES .8022 2.8 4.4 26
268..... 09 SURG SKIN, SUBCUTANEOUS TISSUE & .9068 2.7 4.4 26
BREAST PLASTIC PROCEDURES.
269..... 09 SURG OTHER SKIN, SUBCUT TISS & 1.6495 6.7 10.0 30
BREAST PROC W CC.
270..... 09 SURG OTHER SKIN, SUBCUT TISS & .6796 2.4 3.6 25
BREAST PROC W/O CC.
271..... 09 MED SKIN ULCERS.................... 1.1157 7.2 9.5 30
272..... 09 MED MAJOR SKIN DISORDERS W CC...... 1.0208 6.1 8.1 29
273..... 09 MED MAJOR SKIN DISORDERS W/O CC.... .6403 4.5 6.1 27
274..... 09 MED MALIGNANT BREAST DISORDERS W CC 1.0741 5.5 8.1 28
275..... 09 MED MALIGNANT BREAST DISORDERS W/O .4845 2.4 3.5 25
CC.
276..... 09 MED NON-MALIGNANT BREAST DISORDERS. .6418 4.2 5.4 27
277..... 09 MED CELLULITIS AGE >17 W CC........ .8703 5.9 7.3 29
278..... 09 MED CELLULITIS AGE >17 W/O CC...... .5822 4.6 5.5 27
279..... 09 MED CELLULITIS AGE 0-17............ .7070 4.2 5.9 27
280..... 09 MED TRAUMA TO THE SKIN, SUBCUT TISS .6847 4.0 5.6 27
& BREAST AGE >17 W CC.
281..... 09 MED TRAUMA TO THE SKIN, SUBCUT TISS .4523 2.8 3.9 26
& BREAST AGE >17 W/O CC.
282..... 09 MED *TRAUMA TO THE SKIN, SUBCUT .2467 2.2 2.2 19
TISS & BREAST AGE 0-17.
283..... 09 MED MINOR SKIN DISORDERS W CC...... .7171 4.4 6.0 27
284..... 09 MED MINOR SKIN DISORDERS W/O CC.... .4307 3.1 4.1 26
285..... 10 SURG AMPUTAT OF LOWER LIMB FOR 2.3880 11.0 15.4 34
ENDOCRINE, NUTRIT, & METABOL
DISORDERS.
286..... 10 SURG ADRENAL & PITUITARY PROCEDURES. 2.3163 6.9 9.0 30
287..... 10 SURG SKIN GRAFTS & WOUND DEBRID FOR 2.1126 10.7 15.5 34
ENDOC, NUTRIT & METAB
DISORDERS.
288..... 10 SURG O.R. PROCEDURES FOR OBESITY.... 2.0397 5.9 8.0 29
289..... 10 SURG PARATHYROID PROCEDURES......... 1.0385 3.0 4.5 26
290..... 10 SURG THYROID PROCEDURES............. .8537 2.3 3.0 16
[[Page 45899]]
291..... 10 SURG THYROGLOSSAL PROCEDURES........ .4657 1.4 1.6 6
292..... 10 SURG OTHER ENDOCRINE, NUTRIT & METAB 2.6301 9.2 13.5 32
O.R. PROC W CC.
293..... 10 SURG OTHER ENDOCRINE, NUTRIT & METAB 1.1866 4.6 6.4 28
O.R. PROC W/O CC.
294..... 10 MED DIABETES AGE >35............... .7579 4.7 6.2 28
295..... 10 MED DIABETES AGE 0-35.............. .7634 3.7 5.1 27
296..... 10 MED NUTRITIONAL & MISC METABOLIC .9166 5.1 7.0 28
DISORDERS AGE >17 W CC.
297..... 10 MED NUTRITIONAL & MISC METABOLIC .5353 3.5 4.6 27
DISORDERS AGE >17 W/O CC.
298..... 10 MED NUTRITIONAL & MISC METABOLIC .4756 2.8 3.8 26
DISORDERS AGE 0-17.
299..... 10 MED INBORN ERRORS OF METABOLISM.... .9790 4.2 6.2 27
300..... 10 MED ENDOCRINE DISORDERS W CC....... 1.0919 5.8 7.9 29
301..... 10 MED ENDOCRINE DISORDERS W/O CC..... .6181 3.6 4.8 27
302..... 11 SURG KIDNEY TRANSPLANT.............. 4.1370 11.9 14.0 35
303..... 11 SURG KIDNEY, URETER & MAJOR BLADDER 2.6171 9.1 11.0 32
PROCEDURES FOR NEOPLASM.
304..... 11 SURG KIDNEY, URETER & MAJOR BLADDER 2.3715 8.1 11.1 31
PROC FOR NON-NEOPL W CC.
305..... 11 SURG KIDNEY, URETER & MAJOR BLADDER 1.1600 4.2 5.4 27
PROC FOR NON-NEOPL W/O CC.
306..... 11 SURG PROSTATECTOMY W CC............. 1.2441 4.9 7.1 28
307..... 11 SURG PROSTATECTOMY W/O CC........... .6639 2.7 3.3 17
308..... 11 SURG MINOR BLADDER PROCEDURES W CC.. 1.4848 5.0 7.5 28
309..... 11 SURG MINOR BLADDER PROCEDURES W/O CC .8061 2.5 3.2 21
310..... 11 SURG TRANSURETHRAL PROCEDURES W CC.. .9694 3.3 4.9 26
311..... 11 SURG TRANSURETHRAL PROCEDURES W/O CC .5486 1.9 2.4 12
312..... 11 SURG URETHRAL PROCEDURES, AGE >17 W .8891 3.3 5.1 26
CC.
313..... 11 SURG URETHRAL PROCEDURES, AGE >17 W/ .5008 1.9 2.6 15
O CC.
314..... 11 SURG *URETHRAL PROCEDURES, AGE 0-17. .4756 2.3 2.3 25
315..... 11 SURG OTHER KIDNEY & URINARY TRACT 2.0612 5.7 10.3 29
O.R. PROCEDURES.
316..... 11 MED RENAL FAILURE.................. 1.2996 5.7 8.1 29
317..... 11 MED ADMIT FOR RENAL DIALYSIS....... .6556 2.7 4.1 26
318..... 11 MED KIDNEY & URINARY TRACT 1.1007 5.2 7.6 28
NEOPLASMS W CC.
319..... 11 MED KIDNEY & URINARY TRACT .5432 2.2 3.4 25
NEOPLASMS W/O CC.
320..... 11 MED KIDNEY & URINARY TRACT .9320 5.6 7.1 29
INFECTIONS AGE >17 W CC.
321..... 11 MED KIDNEY & URINARY TRACT .6104 4.2 5.1 25
INFECTIONS AGE >17 W/O CC.
322..... 11 MED KIDNEY & URINARY TRACT .6651 3.9 5.4 27
INFECTIONS AGE 0-17.
323..... 11 MED URINARY STONES W CC, &/OR ESW .7281 2.8 3.8 26
LITHOTRIPSY.
324..... 11 MED URINARY STONES W/O CC.......... .3992 1.8 2.3 11
325..... 11 MED KIDNEY & URINARY TRACT SIGNS & .6436 3.7 4.9 27
SYMPTOMS AGE >17 W CC.
326..... 11 MED KIDNEY & URINARY TRACT SIGNS & .4233 2.6 3.4 21
SYMPTOMS AGE >17 W/O CC.
327..... 11 MED *KIDNEY & URINARY TRACT SIGNS & .2302 3.1 3.1 26
SYMPTOMS AGE 0-17.
328..... 11 MED URETHRAL STRICTURE AGE >17 W CC .6672 3.2 4.4 26
329..... 11 MED URETHRAL STRICTURE AGE >17 W/O .4233 1.9 2.3 13
CC.
330..... 11 MED *URETHRAL STRICTURE AGE 0-17... .3063 1.6 1.6 9
331..... 11 MED OTHER KIDNEY & URINARY TRACT 1.0122 4.9 6.8 28
DIAGNOSES AGE >17 W CC.
332..... 11 MED OTHER KIDNEY & URINARY TRACT .6176 3.1 4.2 26
DIAGNOSES AGE >17 W/O CC.
333..... 11 MED OTHER KIDNEY & URINARY TRACT .8701 4.2 6.0 27
DIAGNOSES AGE 0-17.
334..... 12 SURG MAJOR MALE PELVIC PROCEDURES W 1.6948 6.1 6.9 25
CC.
335..... 12 SURG MAJOR MALE PELVIC PROCEDURES W/ 1.3044 4.8 5.3 20
O CC.
336..... 12 SURG TRANSURETHRAL PROSTATECTOMY W .8802 3.6 4.6 25
CC.
337..... 12 SURG TRANSURETHRAL PROSTATECTOMY W/O .6128 2.6 3.0 12
CC.
338..... 12 SURG TESTES PROCEDURES, FOR 1.0260 3.7 5.7 27
MALIGNANCY.
339..... 12 SURG TESTES PROCEDURES, NON- .9330 3.1 4.7 26
MALIGNANCY AGE >17.
340..... 12 SURG *TESTES PROCEDURES, NON- .2723 2.4 2.4 13
MALIGNANCY AGE 0-17.
341..... 12 SURG PENIS PROCEDURES............... 1.0699 2.6 3.7 25
342..... 12 SURG CIRCUMCISION AGE >17........... .7360 2.8 4.2 26
343..... 12 SURG *CIRCUMCISION AGE 0-17......... .1479 1.7 1.7 6
[[Page 45900]]
344..... 12 SURG OTHER MALE REPRODUCTIVE SYSTEM 1.0209 2.4 3.5 25
O.R. PROCEDURES FOR MALIGNANCY.
345..... 12 SURG OTHER MALE REPRODUCTIVE SYSTEM .8435 3.0 4.6 26
O.R. PROC EXCEPT FOR
MALIGNANCY.
346..... 12 MED MALIGNANCY, MALE REPRODUCTIVE .9626 5.1 7.5 28
SYSTEM, W CC.
347..... 12 MED MALIGNANCY, MALE REPRODUCTIVE .4853 2.5 3.6 25
SYSTEM, W/O CC.
348..... 12 MED BENIGN PROSTATIC HYPERTROPHY W .7106 3.8 5.3 27
CC.
349..... 12 MED BENIGN PROSTATIC HYPERTROPHY W/ .4241 2.3 3.1 22
O CC.
350..... 12 MED INFLAMMATION OF THE MALE .6810 4.3 5.3 27
REPRODUCTIVE SYSTEM.
351..... 12 MED *STERILIZATION, MALE........... .2271 1.3 1.3 5
352..... 12 MED OTHER MALE REPRODUCTIVE SYSTEM .5932 3.1 4.2 26
DIAGNOSES.
353..... 13 SURG PELVIC EVISCERATION, RADICAL 1.9483 7.5 9.4 30
HYSTERECTOMY & RADICAL
VULVECTOMY.
354..... 13 SURG UTERINE, ADNEXA PROC FOR NON- 1.4609 5.6 6.8 29
OVARIAN/ADNEXAL MALIG W CC.
355..... 13 SURG UTERINE, ADNEXA PROC FOR NON- .8881 3.8 4.1 12
OVARIAN/ADNEXAL MALIG W/O CC.
356..... 13 SURG FEMALE REPRODUCTIVE SYSTEM .7323 2.9 3.3 13
RECONSTRUCTIVE PROCEDURES.
357..... 13 SURG UTERINE & ADNEXA PROC FOR 2.3679 8.5 10.6 31
OVARIAN OR ADNEXAL MALIGNANCY.
358..... 13 SURG UTERINE & ADNEXA PROC FOR NON- 1.1458 4.3 5.1 20
MALIGNANCY W CC.
359..... 13 SURG UTERINE & ADNEXA PROC FOR NON- .8072 3.2 3.5 10
MALIGNANCY W/O CC.
360..... 13 SURG VAGINA, CERVIX & VULVA .8739 3.3 4.2 23
PROCEDURES.
361..... 13 SURG LAPAROSCOPY & INCISIONAL TUBAL 1.1984 3.2 5.0 26
INTERRUPTION.
362..... 13 SURG *ENDOSCOPIC TUBAL INTERRUPTION. .2902 1.4 1.4 5
363..... 13 SURG D&C, CONIZATION & RADIO- .6881 2.7 3.7 22
IMPLANT, FOR MALIGNANCY.
364..... 13 SURG D&C, CONIZATION EXCEPT FOR .6667 2.6 3.8 26
MALIGNANCY.
365..... 13 SURG OTHER FEMALE REPRODUCTIVE 1.7739 6.0 8.7 29
SYSTEM O.R. PROCEDURES.
366..... 13 MED MALIGNANCY, FEMALE REPRODUCTIVE 1.1405 5.5 8.2 29
SYSTEM W CC.
367..... 13 MED MALIGNANCY, FEMALE REPRODUCTIVE .5179 2.5 3.7 25
SYSTEM W/O CC.
368..... 13 MED INFECTIONS, FEMALE REPRODUCTIVE .9841 5.5 7.1 29
SYSTEM.
369..... 13 MED MENSTRUAL & OTHER FEMALE .5130 2.7 3.9 26
REPRODUCTIVE SYSTEM DISORDERS.
370..... 14 SURG CESAREAN SECTION W CC.......... .9573 4.5 5.7 26
371..... 14 SURG CESAREAN SECTION W/O CC........ .6531 3.4 3.8 11
372..... 14 MED VAGINAL DELIVERY W COMPLICATING .5558 2.6 3.5 20
DIAGNOSES.
373..... 14 MED VAGINAL DELIVERY W/O .3446 1.8 2.1 8
COMPLICATING DIAGNOSES.
374..... 14 SURG VAGINAL DELIVERY W .6721 2.3 2.8 13
STERILIZATION &/OR D&C.
375..... 14 SURG *VAGINAL DELIVERY W O.R. PROC .6587 4.4 4.4 27
EXCEPT STERIL &/OR D&C.
376..... 14 MED POSTPARTUM & POST ABORTION .4418 2.5 3.7 26
DIAGNOSES W/O O.R. PROCEDURE.
377..... 14 SURG POSTPARTUM & POST ABORTION .8181 2.8 4.3 26
DIAGNOSES W O.R. PROCEDURE.
378..... 14 MED ECTOPIC PREGNANCY.............. .7409 2.4 2.8 14
379..... 14 MED THREATENED ABORTION............ .3962 2.2 3.4 25
380..... 14 MED ABORTION W/O D&C............... .3742 1.6 2.0 9
381..... 14 SURG ABORTION W D&C, ASPIRATION .4673 1.5 2.1 11
CURETTAGE OR HYSTEROTOMY.
382..... 14 MED FALSE LABOR.................... .1922 1.2 1.9 7
383..... 14 MED OTHER ANTEPARTUM DIAGNOSES W .4587 3.1 4.4 26
MEDICAL COMPLICATIONS.
384..... 14 MED OTHER ANTEPARTUM DIAGNOSES W/O .2818 1.6 2.1 10
MEDICAL COMPLICATIONS.
385..... 15 ............ *NEONATES, DIED OR TRANSFERRED 1.3219 1.8 1.8 25
TO ANOTHER ACUTE CARE FACILITY.
386..... 15 ............ *EXTREME IMMATURITY OR 4.3591 17.9 17.9 41
RESPIRATORY DISTRESS SYNDROME,
NEONATE.
387..... 15 ............ *PREMATURITY W MAJOR PROBLEMS.. 2.9772 13.3 13.3 36
388..... 15 ............ *PREMATURITY W/O MAJOR PROBLEMS 1.7964 8.6 8.6 32
389..... 15 FULL TERM NEONATE W MAJOR 2.3785 7.8 10.3 31
PROBLEMS.
[[Page 45901]]
390..... 15 NEONATE W OTHER SIGNIFICANT .6218 2.7 4.4 26
PROBLEMS.
391..... 15 ............ *NORMAL NEWBORN................ .1465 3.1 3.1 11
392..... 16 SURG SPLENECTOMY AGE >17............ 3.1908 9.3 12.0 32
393..... 16 SURG *SPLENECTOMY AGE 0-17.......... 1.2949 9.1 9.1 32
394..... 16 SURG OTHER O.R. PROCEDURES OF THE 1.6252 4.9 8.5 28
BLOOD AND BLOOD FORMING ORGANS.
395..... 16 MED RED BLOOD CELL DISORDERS AGE .8359 4.1 5.8 27
>17.
396..... 16 MED RED BLOOD CELL DISORDERS AGE 0- .5980 2.8 4.2 26
17.
397..... 16 MED COAGULATION DISORDERS.......... 1.2825 4.8 6.6 28
398..... 16 MED RETICULOENDOTHELIAL & IMMUNITY 1.2360 5.6 7.2 29
DISORDERS W CC.
399..... 16 MED RETICULOENDOTHELIAL & IMMUNITY .6934 3.8 4.7 27
DISORDERS W/O CC.
400..... 17 SURG LYMPHOMA & LEUKEMIA W MAJOR 2.6034 7.2 11.2 30
O.R. PROCEDURE.
401..... 17 SURG LYMPHOMA & NON-ACUTE LEUKEMIA W 2.4533 9.0 13.1 32
OTHER O.R. PROC W CC.
402..... 17 SURG LYMPHOMA & NON-ACUTE LEUKEMIA W .9428 3.1 4.6 26
OTHER O.R. PROC W/O CC.
403..... 17 MED LYMPHOMA & NON-ACUTE LEUKEMIA W 1.6823 6.9 10.0 30
CC.
404..... 17 MED LYMPHOMA & NON-ACUTE LEUKEMIA W/ .8140 3.8 5.4 27
O CC.
405..... 17 ............ *ACUTE LEUKEMIA W/O MAJOR O.R. 1.8358 4.9 4.9 28
PROCEDURE AGE 0-17.
406..... 17 SURG MYELOPROLIF DISORD OR POORLY 2.6558 8.6 12.0 32
DIFF NEOPL W MAJ O.R. PROC W
CC.
407..... 17 SURG MYELOPROLIF DISORD OR POORLY 1.1626 4.0 5.1 27
DIFF NEOPL W MAJ O.R. PROC W/O
CC.
408..... 17 SURG MYELOPROLIF DISORD OR POORLY 1.6840 5.2 8.8 28
DIFF NEOPL W OTHER O.R. PROC.
409..... 17 MED RADIOTHERAPY................... .9475 4.9 7.0 28
410..... 17 MED CHEMOTHERAPY W/O ACUTE LEUKEMIA .7172 2.6 3.3 20
AS SECONDARY DIAGNOSIS.
411..... 17 MED HISTORY OF MALIGNANCY W/O .5015 2.5 3.4 25
ENDOSCOPY.
412..... 17 MED HISTORY OF MALIGNANCY W .4530 2.1 2.9 24
ENDOSCOPY.
413..... 17 MED OTHER MYELOPROLIF DIS OR POORLY 1.3422 6.4 9.2 29
DIFF NEOPL DIAG W CC.
414..... 17 MED OTHER MYELOPROLIF DIS OR POORLY .7285 3.9 5.9 27
DIFF NEOPL DIAG W/O CC.
415..... 18 SURG O.R. PROCEDURE FOR INFECTIOUS & 3.4769 12.4 17.3 35
PARASITIC DISEASES.
416..... 18 MED SEPTICEMIA AGE >17............. 1.4770 6.5 8.9 30
417..... 18 MED SEPTICEMIA AGE 0-17............ .8764 4.8 6.1 28
418..... 18 MED POSTOPERATIVE & POST-TRAUMATIC .9777 5.7 7.3 29
INFECTIONS.
419..... 18 MED FEVER OF UNKNOWN ORIGIN AGE >17 .9223 4.8 6.2 28
W CC.
420..... 18 MED FEVER OF UNKNOWN ORIGIN AGE >17 .6258 3.8 4.6 25
W/O CC.
421..... 18 MED VIRAL ILLNESS AGE >17.......... .6982 3.8 4.9 27
422..... 18 MED VIRAL ILLNESS & FEVER OF .5446 3.3 4.3 26
UNKNOWN ORIGIN AGE 0-17.
423..... 18 MED OTHER INFECTIOUS & PARASITIC 1.5828 6.8 9.4 30
DISEASES DIAGNOSES.
424..... 19 SURG O.R. PROCEDURE W PRINCIPAL 2.4543 12.1 20.0 35
DIAGNOSES OF MENTAL ILLNESS.
425..... 19 MED ACUTE ADJUST REACT & .7129 3.9 5.5 27
DISTURBANCES OF PSYCHOSOCIAL
DYSFUNCTION.
426..... 19 MED DEPRESSIVE NEUROSES............ .5949 4.5 6.3 27
427..... 19 MED NEUROSES EXCEPT DEPRESSIVE..... .5794 4.1 5.9 27
428..... 19 MED DISORDERS OF PERSONALITY & .6847 5.2 8.1 28
IMPULSE CONTROL.
429..... 19 MED ORGANIC DISTURBANCES & MENTAL .9537 6.6 10.4 30
RETARDATION.
430..... 19 MED PSYCHOSES...................... .8670 7.5 10.7 30
431..... 19 MED CHILDHOOD MENTAL DISORDERS..... .6362 5.3 7.6 28
432..... 19 MED OTHER MENTAL DISORDER DIAGNOSES .7018 4.2 6.6 27
433..... 20 ALCOHOL/DRUG ABUSE OR .3080 2.6 3.7 26
DEPENDENCE, LEFT AMA.
434..... 20 ALC/DRUG ABUSE OR DEPEND, DETOX .7373 4.7 6.4 28
OR OTH SYMPT TREAT W CC.
435..... 20 ALC/DRUG ABUSE OR DEPEND, DETOX .4249 3.9 5.1 27
OR OTH SYMPT TREAT W/O CC.
436..... 20 ALC/DRUG DEPENDENCE W .8384 12.6 15.7 36
REHABILITATION THERAPY.
437..... 20 ALC/DRUG DEPENDENCE, COMBINED .7972 9.9 11.8 33
REHAB & DETOX THERAPY.
438..... NO LONGER VALID................ .0000 .0 .0 0
[[Page 45902]]
439..... 21 SURG SKIN GRAFTS FOR INJURIES....... 1.6599 5.6 9.3 29
440..... 21 SURG WOUND DEBRIDEMENTS FOR INJURIES 1.7792 7.0 11.0 30
441..... 21 SURG HAND PROCEDURES FOR INJURIES... .8785 2.3 4.3 25
442..... 21 SURG OTHER O.R. PROCEDURES FOR 2.0836 5.7 9.1 29
INJURIES W CC.
443..... 21 SURG OTHER O.R. PROCEDURES FOR .8130 2.4 3.4 25
INJURIES W/O CC.
444..... 21 MED TRAUMATIC INJURY AGE >17 W CC.. .7290 4.4 5.8 27
445..... 21 MED TRAUMATIC INJURY AGE >17 W/O CC .4664 2.9 3.9 26
446..... 21 MED *TRAUMATIC INJURY AGE 0-17..... .2846 2.4 2.4 22
447..... 21 MED ALLERGIC REACTIONS AGE >17..... .4976 2.3 3.1 20
448..... 21 MED ALLERGIC REACTIONS AGE 0-17.... .0896 1.0 1.0 1
449..... 21 MED POISONING & TOXIC EFFECTS OF .7886 3.3 4.8 26
DRUGS AGE >17 W CC.
450..... 21 MED POISONING & TOXIC EFFECTS OF .4329 1.9 2.6 15
DRUGS AGE >17 W/O CC.
451..... 21 MED *POISONING & TOXIC EFFECTS OF .2527 2.1 2.1 17
DRUGS AGE 0-17.
452..... 21 MED COMPLICATIONS OF TREATMENT W CC .9127 3.9 5.6 27
453..... 21 MED COMPLICATIONS OF TREATMENT W/O .4752 2.6 3.5 24
CC.
454..... 21 MED OTHER INJURY, POISONING & TOXIC .8906 3.8 6.1 27
EFFECT DIAG W CC.
455..... 21 MED OTHER INJURY, POISONING & TOXIC .4689 2.3 3.5 25
EFFECT DIAG W/O CC.
456..... 22 BURNS, TRANSFERRED TO ANOTHER 1.9410 4.2 8.2 27
ACUTE CARE FACILITY.
457..... 22 MED EXTENSIVE BURNS W/O O.R. 1.5849 2.5 5.1 26
PROCEDURE.
458..... 22 SURG NON-EXTENSIVE BURNS W SKIN 3.4645 12.8 18.4 36
GRAFT.
459..... 22 SURG NON-EXTENSIVE BURNS W WOUND 1.9398 8.2 13.2 31
DEBRIDEMENT OR OTHER O.R. PROC.
460..... 22 MED NON-EXTENSIVE BURNS W/O O.R. .9369 5.1 7.3 28
PROCEDURE.
461..... 23 SURG O.R. PROC W DIAGNOSES OF OTHER 1.0104 2.6 5.4 26
CONTACT W HEALTH SERVICES.
462..... 23 MED REHABILITATION................. 1.4731 11.8 14.7 35
463..... 23 MED SIGNS & SYMPTOMS W CC.......... .7416 4.2 5.9 27
464..... 23 MED SIGNS & SYMPTOMS W/O CC........ .4972 3.0 4.0 26
465..... 23 MED AFTERCARE W HISTORY OF .4362 1.9 2.9 20
MALIGNANCY AS SECONDARY
DIAGNOSIS.
466..... 23 MED AFTERCARE W/O HISTORY OF .5601 2.5 4.6 26
MALIGNANCY AS SECONDARY
DIAGNOSIS.
467..... 23 MED OTHER FACTORS INFLUENCING .4291 2.6 5.0 26
HEALTH STATUS.
468..... EXTENSIVE O.R. PROCEDURE 3.5391 11.4 16.5 34
UNRELATED TO PRINCIPAL
DIAGNOSIS.
469..... ....... ............ **PRINCIPAL DIAGNOSIS INVALID .0000 .0 .0 0
AS DISCHARGE DIAGNOSIS.
470..... ....... ............ **UNGROUPABLE.................. .0000 .0 .0 0
471..... 08 SURG BILATERAL OR MULTIPLE MAJOR 3.6458 8.0 9.6 31
JOINT PROCS OF LOWER EXTREMITY.
472..... 22 SURG EXTENSIVE BURNS W O.R. 10.6993 14.3 31.4 37
PROCEDURE.
473..... 17 ACUTE LEUKEMIA W/O MAJOR O.R. 3.4797 8.9 15.3 32
PROCEDURE AGE >17.
474..... NO LONGER VALID................ .0000 .0 .0 0
475..... 04 MED RESPIRATORY SYSTEM DIAGNOSIS 3.7015 9.1 13.1 32
WITH VENTILATOR SUPPORT.
476..... ....... SURG PROSTATIC O.R. PROCEDURE 2.2703 11.5 15.1 35
UNRELATED TO PRINCIPAL
DIAGNOSIS.
477..... ....... SURG NON-EXTENSIVE O.R. PROCEDURE 1.5682 5.8 9.4 29
UNRELATED TO PRINCIPAL
DIAGNOSIS.
478..... 05 SURG OTHER VASCULAR PROCEDURES W CC. 2.2709 6.0 9.0 29
479..... 05 SURG OTHER VASCULAR PROCEDURES W/O 1.3864 3.7 5.0 27
CC.
480..... ....... SURG LIVER TRANSPLANT............... 16.3066 24.4 33.8 47
481..... ....... SURG BONE MARROW TRANSPLANT......... 11.6796 27.2 31.2 50
482..... ....... SURG TRACHEOSTOMY FOR FACE,MOUTH & 3.6620 12.4 16.3 35
NECK DIAGNOSES.
483..... ....... SURG TRACHEOSTOMY EXCEPT FOR 16.1090 38.2 49.7 61
FACE,MOUTH & NECK DIAGNOSES.
484..... 24 SURG CRANIOTOMY FOR MULTIPLE 5.4488 10.9 17.1 34
SIGNIFICANT TRAUMA.
485..... 24 SURG LIMB REATTACHMENT, HIP AND 3.2610 10.5 13.4 33
FEMUR PROC FOR MULTIPLE
SIGNIFICANT TR.
486..... 24 SURG OTHER O.R. PROCEDURES FOR 4.8763 9.6 15.1 33
MULTIPLE SIGNIFICANT TRAUMA.
487..... 24 MED OTHER MULTIPLE SIGNIFICANT 1.9932 6.8 10.1 30
TRAUMA.
488..... 25 SURG HIV W EXTENSIVE O.R. PROCEDURE. 4.2177 13.9 19.0 37
[[Page 45903]]
489..... 25 MED HIV W MAJOR RELATED CONDITION.. 1.7856 7.8 11.7 31
490..... 25 MED HIV W OR W/O OTHER RELATED 1.0476 4.7 7.3 28
CONDITION.
491..... 08 SURG MAJOR JOINT & LIMB REATTACHMENT 1.6088 4.0 4.8 22
PROCEDURES OF UPPER EXTREMITY.
492..... 17 MED CHEMOTHERAPY W ACUTE LEUKEMIA 4.1529 11.8 18.4 35
AS SECONDARY DIAGNOSIS.
493..... 07 SURG LAPAROSCOPIC CHOLECYSTECTOMY W/ 1.6501 4.3 6.2 27
O C.D.E. W CC.
494..... 07 SURG LAPAROSCOPIC CHOLECYSTECTOMY W/ .8769 1.8 2.4 15
O C.D.E. W/O CC.
495..... ....... SURG LUNG TRANSPLANT................ 9.5678 18.2 23.2 41
----------------------------------------------------------------------------------------------------------------
* Medicare data have been supplemented by data from 19 states for low volume DRGS.
** DRGS 469 and 470 contain cases which could not be assigned to valid DRGS.
Note: Geometric mean is used only to determine payment for transfer cases.
Note: Arithmetic mean is used only to determine payment for outlier cases.
Note: Relative weights are based on Medicare patient data and may not be appropriate for other patients.
Table 6a.--New Diagnosis Codes
----------------------------------------------------------------------------------------------------------------
Diagnosis code Description CC MDC DRG
----------------------------------------------------------------------------------------------------------------
005.81........ Food poisoning due to Vibrio vulnificus... N 6 182, 183, 184
005.89........ Other bacterial food poisoning............ N 6 182, 183, 184
041.86........ Helicobacter pylori (H. pylori) infection. N 18 423
079.81........ Hantavirus infection...................... N 18 421, 422
278.00........ Obesity, unspecified...................... N 10 296, 297, 298
278.01........ Morbid obesity............................ N 10 296, 297, 298
415.11........ Iatrogenic pulmonary embolism and Y 4 78
infarction.
5 121, 124
15 387, 389 \1\
415.19........ Other pulmonary embolism and infraction... Y 4 78
5 121, 124
15 387, 389 \1\
435.3......... Vertebrobasilar artery syndrome........... N 1 15
458.2......... Iatrogenic hypotension.................... N 5 141, 142
569.60........ Colostomy and enterostomy complication, Y 6 188, 189, 190
not otherwise specified.
569.61........ Infection of colostomy or enterostomy..... Y 6 188, 189, 190
569.69........ Other colostomy and enterostomy Y 6 188, 189, 190
complication.
690.10........ Seborrheic dermatitis, unspecified........ N 9 283, 284
690.11........ Seborrhea capitis......................... N 9 283, 284
690.12........ Seborrheic infantile dermatitis........... N 9 283, 284
690.18........ Other seborrheic dermatitis............... N 9 283, 284
690.8......... Other erythematosquamous dermatosis....... N 9 283, 284
728.86........ Necrotizing fasciitis..................... Y 8 248
787.91........ Diarrhea.................................. N 6 182, 183, 184
787.99........ Other symptoms involving digestive system. N 6 182, 183, 184
989.81........ Toxic effect of asbestos.................. N 21 449, 450, 451
989.82........ Toxic effect of latex..................... N 21 449, 450, 451
989.83........ Toxic effect of silicone.................. N 21 449, 450, 451
989.84........ Toxic effect of tobacco................... N 21 449, 450, 451
989.89........ Toxic effect of other substance, chiefly N 21 449, 450, 451
nonmedicinal as to source, not elsewhere
classified.
997.00........ Nervous system complication, unspecified.. Y 1 34, 35
15 387, 389 \1\
997.01........ Central nervous system complication....... Y 1 34, 35
15 387, 389 \1\
997.02........ Iatrogenic cerebrovascular infarction or Y 1 34, 35
hemorrhage.
15 387, 389 \1\
997.09........ Other nervous system complications........ Y 1 34, 35
15 387, 389 \1\
997.91........ Complications affecting other specified N 21 452, 453
body systems, hypertension.
997.99........ Complications affecting other specified Y 21 452, 453
body systems, not elsewhere classified.
V12.50........ Personal history of unspecified N 23 467
circulatory disease.
V12.51........ Personal history of venous thrombosis and N 23 467
embolism.
V12.52........ Personal history of thrombophlebitis...... N 23 467
V12.59........ Personal history of other diseases, of N 23 467
circulatory system, not elsewhere
classified.
V15.84........ Personal history of exposure to asbestos.. N 23 467
[[Page 45904]]
V15.85........ Personal history of exposure to N 23 467
potentially hazardous body fluids.
V15.86........ Personal history of exposure to lead...... N 23 467
V43.81........ Larynx replacement status................. N 23 467
V43.82........ Breast replacement status................. N 23 467
V43.89........ Other organ or tissue replacement status, N 23 467
not elsewhere classified.
V45.83........ Breast implant removal status............. N 23 467
V56.1......... Fitting and adjustment of dialysis N 11 317
(extracorporeal) (peritoneal) catheter.
V58.61........ Long-term (current) use of anticoagulants. N 23 465, 466
V58.69........ Long-term (current) use of other N 23 465, 466
medications.
V58.82........ Fitting and adjustment of non-vascular N 23 465, 466
catheter, not elsewhere classified.
V59.01........ Blood donor, whole blood.................. N 23 467
V59.02........ Blood donor, stem cells................... N 23 467
V59.09........ Other blood donor......................... N 23 467
V59.6......... Liver donor............................... N 7 205, 206
----------------------------------------------------------------------------------------------------------------
\1\ Diagnosis code is classified as a ``major problem'' in these DRGs.
Table 6b.--New Procedure Codes
----------------------------------------------------------------------------------------------------------------
Procedure code Description OR MDC DRG
----------------------------------------------------------------------------------------------------------------
05.25......... Periarterial sympathectomy................ Y 1 7, 8
5 120
32.22......... Lung volume reduction surgery............. Y 4 75
33.50......... Lung transplantation, not otherwise Y Pre 495
specified.
33.51......... Unilateral lung transplantation........... Y Pre 495
33.52......... Bilateral lung transplantation............ Y Pre 495
36.06......... Insertion of coronary artery stent(s)..... N .......... ..........................
37.65......... Implant of an external, pulsatile heart Y 5 110, 111
assist system.
37.66......... Implant of an implantable, pulsatile heart Y 5 110, 111
assist system.
39.50......... Angioplasty or atherectomy of non-coronary Y 1 5
vessel.
5 478, 479
9 269, 270
10 292, 293
11 315
21 442, 443
24 486
48.36......... [Endoscopic] polypectomy of rectum........ N \1\ 17 412
59.72......... Injection of implant into urethra and/or N \1\ 11 308, 309
bladder neck.
13 356
60.21......... Transurethral (ultrasound) guided laser Y 11 306, 307
induced prostatectomy (TULIP).
12 336, 337
.......... 476
60.29......... Other transurethral prostatectomy......... Y 11 306, 307
12 336, 337
.......... 476
92.3.......... Stereotactic radiosurgery................. N \1\ 1 1, 2, 3
10 286
17 400, 406, 407
99.00......... Perioperative autologous transfusion of N .......... ..........................
whole blood or blood components.
----------------------------------------------------------------------------------------------------------------
\1\ Non-OR procedure that affects DRG assignment.
Table 6c.--Invalid Diagnosis Codes
----------------------------------------------------------------------------------------------------------------
Diagnosis code Description CC MDC DRG
----------------------------------------------------------------------------------------------------------------
005.8......... Other bacterial food poisoning............ N 6 182, 183, 184
278.0......... Obesity................................... N 10 296, 297, 298
415.1......... Pulmonary embolism and infarction......... Y 4 78
15 387, 389
569.6......... Colostomy and enterostomy malfunction..... Y 6 188, 189, 190
690........... Erythematosquamous dermatosis............. N 9 283, 284
787.9......... Other symptoms involving digestive system. N 6 182, 183, 184
989.8......... Toxic effect of other substances, chiefly N 21 449, 450, 451
nonmedicinal as to source.
997.0......... Central nervous system complications...... Y 1 34, 35
15 387, 389
997.9......... Complications affecting other specified Y 21 452, 453
body systems, not elsewhere classified.
V12.5......... Personal history of diseases of N 23 467
circulatory system.
V43.8......... Organ or tissue replaced by other means, N 23 467
not elsewhere classified.
V59.0......... Blood donor............................... N 23 467
----------------------------------------------------------------------------------------------------------------
[[Page 45905]]
Table 6d.--Invalid Procedure Codes
----------------------------------------------------------------------------------------------------------------
Procedure code Description OR MDC DRG
----------------------------------------------------------------------------------------------------------------
33.5.......... Lung transplant........................... Y Pre 495
39.7.......... Periarterial sympathectomy................ Y 5 478, 479
60.2.......... Transurethral prostatectomy............... Y 11 306, 307
12 336, 337, 476
----------------------------------------------------------------------------------------------------------------
Table 6e.--Revised Diagnosis Code Titles
----------------------------------------------------------------------------------------------------------------
Diagnosis code Description CC MDC DRG
----------------------------------------------------------------------------------------------------------------
441.00........ Dissection of aorta, unspecified site..... Y 5 121, 130, 131
441.01........ Dissection of aorta, thoracic............. Y 5 121, 130, 131
441.02........ Dissection of aorta, abdominal............ Y 5 121, 130, 131
441.03........ Dissection of aorta, thoracoabdominal..... Y 5 121, 130, 131
560.81........ Intestinal or peritoneal adhesions with Y 6 180, 181
obstruction (postoperative)
(postinfection).
568.0......... Peritoneal adhesions (postoperative) N 6 188, 189, 190
(postinfection).
614.6......... Pelvic peritoneal adhesions, female N 13 358, 359, 369
(postoperative) (postinfection).
650........... Normal delivery........................... N 14 370, 371, 372,
373, 374, 375
780.6......... Fever..................................... N 18 419, 420, 422
997.4......... Digestive system complication............. Y 6 188, 189, 190
V52.4......... Fitting and adjustment of breast N 23 467
prosthesis and implant.
V53.5......... Fitting and adjustment of other intestinal N 6 188, 189, 190
appliance.
V58.81........ Fitting and adjustment of vascular N 23 465, 466
catheter.
V67.51........ Follow-up examination following completed N 23 467
treatment with high-risk medications, not
elsewhere classified.
----------------------------------------------------------------------------------------------------------------
Table 6f.--Revised Procedure Code Titles
----------------------------------------------------------------------------------------------------------------
Procedure code Description OR MDC DRG
----------------------------------------------------------------------------------------------------------------
99.02......... Transfusion of previously collected N .......... ..........................
autologous blood.
----------------------------------------------------------------------------------------------------------------
[[Page 45906]]
[GRAPHIC][TIFF OMITTED]TR01SE95.000
[[Page 45907]]
[GRAPHIC][TIFF OMITTED]TR01SE95.001
[[Page 45908]]
[GRAPHIC][TIFF OMITTED]TR01SE95.002
BILLING CODE 4120-01-C
Table 7a.--Medicare Prospective Payment System Selected Percentile Lengths of Stay
[FY94 MEDPAR Update 06/95 Grouper V12.0]
--------------------------------------------------------------------------------------------------------------------------------------------------------
Arithmetic 10th
DRG Numberdischarges mean LOS percentile 25thpercentile 50thpercentile 75thpercentile 90thpercentile
--------------------------------------------------------------------------------------------------------------------------------------------------------
001................................... 32563 12.4181 3 5 9 15 25
002................................... 6318 12.5554 3 6 9 15 25
003................................... 1 7.0000 7 7 7 7 7
004................................... 5716 9.9696 2 3 7 13 21
005................................... 69427 5.2597 2 3 4 6 10
006................................... 501 4.0279 1 1 2 4 9
007................................... 10150 14.6042 3 5 9 16 29
008................................... 2567 4.4437 1 1 3 6 10
009................................... 1736 8.2160 2 3 6 10 16
010................................... 20459 8.7558 2 3 6 11 18
011................................... 2983 5.0851 1 2 4 7 10
012................................... 23793 8.6530 2 4 6 10 16
013................................... 6352 6.9216 3 4 5 8 12
014................................... 355976 8.1794 2 4 6 10 15
015................................... 148758 4.9390 2 2 4 6 9
016................................... 12186 7.4179 2 3 5 8 14
017................................... 3269 4.1318 1 2 3 5 8
018................................... 22386 6.8428 2 3 5 8 13
019................................... 7310 4.5988 1 2 4 6 9
020................................... 8255 11.2443 3 5 9 14 22
021................................... 1176 8.6548 2 4 7 11 17
022................................... 3015 5.1035 2 2 4 6 10
023................................... 6002 5.4725 1 2 4 7 11
024................................... 58588 6.4046 2 3 4 7 12
025................................... 22077 4.0534 1 2 3 5 8
026................................... 48 4.4792 1 2 3 5 11
027................................... 3438 7.1175 1 1 4 9 16
028................................... 10488 7.7212 1 3 5 9 16
029................................... 3382 4.1824 1 2 3 5 8
030................................... 1 20.0000 20 20 20 20 20
031................................... 3665 5.5831 1 2 4 6 10
032................................... 2081 3.2912 1 1 2 4 6
034................................... 16015 6.8307 2 3 5 8 14
035................................... 3372 4.6987 1 2 3 6 9
036................................... 13095 1.7163 1 1 1 2 3
037................................... 2216 4.1119 1 1 2 5 8
038................................... 365 2.7342 1 1 2 3 6
039................................... 4054 1.9171 1 1 1 2 4
040................................... 2929 3.8631 1 1 2 5 8
041................................... 1 2.0000 2 2 2 2 2
042................................... 9820 2.1876 1 1 1 2 4
043................................... 132 3.8409 1 2 3 5 7
044................................... 1727 5.8871 2 3 5 7 10
045................................... 2559 4.3118 1 2 3 5 8
[[Page 45909]]
046................................... 3321 5.9377 1 3 4 7 11
047................................... 1455 3.9072 1 2 3 5 7
049................................... 2308 7.0156 2 3 5 8 14
050................................... 3738 2.3767 1 1 2 3 4
051................................... 376 3.0213 1 1 2 3 7
052................................... 89 3.3596 1 1 2 4 7
053................................... 3955 3.7067 1 1 2 4 8
054................................... 2 4.0000 1 1 7 7 7
055................................... 2311 2.9619 1 1 1 3 7
056................................... 788 3.0089 1 1 2 4 6
057................................... 663 4.8763 1 2 3 6 12
059................................... 109 2.9174 1 1 2 3 6
060................................... 2 1.5000 1 1 2 2 2
061................................... 269 5.8513 1 1 3 8 14
063................................... 4451 4.9155 1 2 3 6 10
064................................... 3708 8.1238 1 2 5 10 18
065................................... 35151 3.6832 1 2 3 4 7
066................................... 7326 3.8463 1 2 3 5 7
067................................... 482 4.3320 1 2 3 5 8
068................................... 15474 5.1430 2 3 4 6 9
069................................... 4123 4.0196 2 2 3 5 7
070................................... 20 2.9500 1 1 2 3 4
071................................... 131 4.3282 1 2 4 6 8
072................................... 672 4.6652 1 2 3 5 8
073................................... 6398 5.3993 1 2 4 7 10
074................................... 1 5.0000 5 5 5 5 5
075................................... 39140 11.8686 4 6 9 14 23
076................................... 39566 13.3501 3 6 10 16 25
077................................... 2515 5.6342 1 2 4 8 12
078................................... 27898 8.7011 4 6 8 10 14
079................................... 202654 10.0625 3 5 8 12 19
080................................... 8161 6.9295 2 4 6 8 12
081................................... 15 6.7333 1 2 7 9 14
082................................... 71979 8.4061 2 4 6 11 17
083................................... 7621 6.8267 2 3 5 8 13
084................................... 1580 4.1968 1 2 3 5 7
085................................... 18459 7.8104 2 4 6 10 15
086................................... 1382 4.5224 1 2 4 6 9
087................................... 56282 7.2175 1 3 6 9 14
088................................... 362753 6.5711 2 4 5 8 12
089................................... 452431 7.5640 3 4 6 9 13
090................................... 40399 5.4006 2 3 5 7 9
091................................... 84 6.0238 1 3 4 8 12
092................................... 11561 7.6630 2 4 6 9 14
093................................... 1306 5.2167 2 3 4 7 10
094................................... 10591 8.0006 2 4 6 10 15
095................................... 1141 4.6599 2 3 4 6 8
096................................... 76006 5.8803 2 3 5 7 10
097................................... 26848 4.5073 2 3 4 6 8
098................................... 30 5.1000 2 3 4 8 9
099................................... 27557 3.8826 1 2 3 5 7
100................................... 10548 2.6031 1 1 2 3 5
101................................... 19218 5.9849 2 3 5 7 12
102................................... 3041 3.9596 1 2 3 5 7
103................................... 404 39.0495 10 15 26 51 82
104................................... 22320 16.0147 7 9 14 20 28
105................................... 19215 11.9858 6 7 9 14 21
106................................... 92000 12.7277 7 8 11 15 21
107................................... 59494 9.7554 5 7 8 11 15
108................................... 6459 13.4696 5 7 11 16 25
110................................... 59003 11.4622 3 6 9 14 22
111................................... 5083 6.9695 3 5 7 8 11
112................................... 184483 4.9679 1 2 4 7 10
113................................... 45403 15.9297 4 7 11 19 32
114................................... 8940 10.4375 2 4 8 13 20
115................................... 10550 11.7955 4 7 10 14 21
116................................... 80447 5.8978 1 2 4 7 12
117................................... 4411 4.4493 1 2 3 5 9
118................................... 7528 3.4186 1 1 2 4 7
119................................... 1966 5.9135 1 1 3 7 13
[[Page 45910]]
120................................... 42953 10.1101 1 3 6 13 22
121................................... 166750 8.0265 3 5 7 10 14
122................................... 94088 5.5209 1 3 5 7 9
123................................... 51365 4.8941 1 1 3 6 12
124................................... 140645 5.2202 1 2 4 7 10
125................................... 64294 3.1754 1 1 2 4 6
126................................... 4717 15.9275 4 7 12 20 32
127................................... 703314 6.7118 2 3 5 8 13
128................................... 21635 7.2159 4 5 6 8 11
129................................... 5134 3.7156 1 1 1 4 9
130................................... 89825 7.1214 2 4 6 9 12
131................................... 24718 5.3976 1 3 5 7 9
132................................... 57611 3.9362 1 2 3 5 7
133................................... 4868 3.0657 1 1 2 4 6
134................................... 30488 4.2292 1 2 3 5 8
135................................... 6938 5.6345 1 2 4 7 11
136................................... 1136 3.5810 1 2 3 4 6
137................................... 1 19.0000 19 19 19 19 19
138................................... 208494 4.8987 1 2 4 6 9
139................................... 66382 3.1027 1 2 2 4 6
140................................... 274276 3.8055 1 2 3 5 7
141................................... 78924 4.9675 1 2 4 6 9
142................................... 34007 3.3981 1 2 3 4 6
143................................... 139417 2.8478 1 1 2 3 5
144................................... 66373 6.0168 1 2 4 7 12
145................................... 6471 3.3973 1 2 3 4 7
146................................... 8486 11.6614 6 8 10 13 19
147................................... 1434 7.6974 4 6 8 9 11
148................................... 150277 14.0788 6 8 11 16 25
149................................... 14026 7.8700 5 6 7 9 11
150................................... 23835 12.2790 5 7 10 15 22
151................................... 4168 6.4614 2 3 6 9 11
152................................... 4836 9.5604 4 6 8 11 16
153................................... 1712 6.2693 3 4 6 8 9
154................................... 38124 15.9926 6 8 12 19 30
155................................... 3900 6.3703 2 3 6 8 11
156................................... 7 14.2857 3 7 17 18 22
157................................... 12182 6.0488 1 2 4 7 12
158................................... 5934 2.8586 1 1 2 4 6
159................................... 18175 5.5457 1 3 4 7 10
160................................... 10370 2.9751 1 2 2 4 6
161................................... 17004 4.5169 1 2 3 6 9
162................................... 9529 2.1407 1 1 2 3 4
163................................... 14 5.0000 1 2 3 7 11
164................................... 5431 9.8404 4 6 8 12 17
165................................... 1586 5.9010 3 4 5 7 9
166................................... 3464 6.0141 2 3 5 7 11
167................................... 2230 3.5422 1 2 3 4 6
168................................... 2006 5.6306 1 2 3 7 13
169................................... 1133 2.6946 1 1 2 3 6
170................................... 13222 13.2743 3 6 10 17 27
171................................... 1092 5.7830 1 2 5 7 11
172................................... 32353 8.7210 2 3 6 11 18
173................................... 2164 4.3170 1 2 3 6 9
174................................... 243846 5.9482 2 3 5 7 11
175................................... 23696 3.6676 1 2 3 4 6
176................................... 16136 6.4648 2 3 5 8 12
177................................... 13362 5.4526 2 3 4 7 10
178................................... 4508 3.8434 1 2 3 5 7
179................................... 10795 7.7602 2 4 6 9 14
180................................... 83783 6.4540 2 3 5 8 12
181................................... 19982 3.9407 1 2 3 5 7
182................................... 245809 5.3597 2 3 4 6 10
183................................... 69783 3.6047 1 2 3 5 7
184................................... 81 3.0494 1 1 2 4 6
185................................... 4072 5.7876 1 2 4 7 12
186................................... 4 5.7500 3 3 5 6 9
187................................... 947 3.8353 1 2 3 5 7
188................................... 60746 6.5210 2 3 5 8 13
189................................... 7663 3.5758 1 1 3 5 7
[[Page 45911]]
190................................... 90 6.4556 2 3 4 8 14
191................................... 10832 17.3060 5 8 13 21 34
192................................... 787 7.9352 2 4 7 10 14
193................................... 9766 14.8273 6 8 12 18 26
194................................... 853 8.1184 3 5 7 10 14
195................................... 11362 11.1542 5 7 9 13 19
196................................... 877 6.9259 3 4 6 9 11
197................................... 32416 9.5929 4 5 8 11 17
198................................... 8653 5.1453 2 3 4 6 8
199................................... 2540 12.4102 3 6 10 16 24
200................................... 1620 12.6056 2 4 9 16 27
201................................... 1615 16.0904 4 7 12 20 30
202................................... 24533 8.2755 2 4 6 10 16
203................................... 29689 8.2140 2 3 6 10 16
204................................... 48970 7.1515 2 3 5 9 14
205................................... 22352 7.9561 2 3 6 10 16
206................................... 1749 4.6798 1 2 4 6 9
207................................... 38216 6.0794 2 3 5 8 11
208................................... 10442 3.4061 1 2 3 4 7
209................................... 327144 7.6473 4 5 7 9 12
210................................... 139525 9.7688 4 6 8 11 16
211................................... 25044 7.0987 3 5 6 8 11
212................................... 22 5.2273 2 3 4 9 10
213................................... 6859 10.6336 3 4 8 13 21
214................................... 53636 7.3683 2 4 6 8 14
215................................... 41531 4.1269 2 2 3 5 7
216................................... 6776 12.2010 3 5 9 15 25
217................................... 19370 17.0114 3 6 11 20 36
218................................... 24059 6.8165 2 3 5 8 13
219................................... 19021 4.0634 2 2 3 5 7
220................................... 5 4.8000 1 1 3 9 9
221................................... 5129 8.7853 2 4 6 10 17
222................................... 3855 4.1642 1 2 3 5 8
223................................... 20648 3.0600 1 1 2 3 6
224................................... 8807 2.3823 1 1 2 3 4
225................................... 7067 5.0662 1 2 3 6 11
226................................... 5949 7.2674 1 2 5 9 15
227................................... 5229 3.1427 1 1 2 4 6
228................................... 3268 3.7840 1 1 2 4 8
229................................... 1575 2.4000 1 1 2 3 5
230................................... 2717 5.5778 1 2 3 6 12
231................................... 11115 5.5294 1 2 3 7 12
232................................... 658 4.4848 1 1 2 5 10
233................................... 4844 9.7967 2 4 7 12 19
234................................... 2286 4.4383 1 2 3 5 9
235................................... 6118 7.6857 2 3 5 8 15
236................................... 40137 6.9930 2 3 5 8 13
237................................... 1595 4.9292 1 2 4 6 9
238................................... 7380 11.3585 3 5 8 13 22
239................................... 62864 8.3598 3 4 6 10 16
240................................... 12072 8.0041 2 4 6 10 16
241................................... 3044 4.8288 1 2 4 6 9
242................................... 2565 8.8881 3 4 7 11 17
243................................... 88802 6.1276 2 3 5 8 11
244................................... 11849 6.3984 2 3 5 8 12
245................................... 4413 4.4829 1 2 3 6 8
246................................... 1417 4.6789 2 2 4 6 8
247................................... 10573 4.2631 1 2 3 5 8
248................................... 6790 5.7025 2 3 4 7 10
249................................... 9934 4.6467 1 2 3 6 9
250................................... 3565 5.6230 1 2 4 6 11
251................................... 2351 3.2157 1 1 2 4 6
252................................... 1 1.0000 1 1 1 1 1
253................................... 18681 6.5628 2 3 5 7 12
254................................... 10004 4.0136 1 2 3 5 7
255................................... 5 9.0000 3 3 8 10 20
256................................... 9799 4.3950 1 2 3 5 9
257................................... 26742 3.8993 2 2 3 4 7
258................................... 20636 2.7720 1 2 2 3 5
259................................... 4509 4.0734 1 1 2 4 8
[[Page 45912]]
260................................... 5286 1.9799 1 1 2 2 3
261................................... 2601 2.5698 1 1 2 3 5
262................................... 810 4.0099 1 1 2 5 9
263................................... 31179 15.7680 4 7 11 19 31
264................................... 3564 9.0659 3 4 7 11 18
265................................... 4760 7.9055 1 2 5 9 17
266................................... 2987 3.8373 1 1 3 5 8
267................................... 250 4.4360 1 1 2 5 9
268................................... 1194 4.4422 1 1 2 5 9
269................................... 11049 9.9436 2 4 7 13 20
270................................... 3978 3.4947 1 1 2 4 7
271................................... 21708 9.4615 3 5 7 11 17
272................................... 6574 8.0613 2 4 6 10 15
273................................... 1539 6.0754 2 3 4 7 12
274................................... 2646 8.0567 1 3 6 10 16
275................................... 246 3.3211 1 1 2 4 7
276................................... 942 5.4055 2 3 4 7 10
277................................... 82558 7.2729 3 4 6 9 13
278................................... 25634 5.4291 2 3 5 7 9
279................................... 14 5.8571 1 2 4 7 14
280................................... 13922 5.5335 1 2 4 7 10
281................................... 6217 3.8679 1 2 3 5 7
282................................... 1 18.0000 18 18 18 18 18
283................................... 5700 5.9395 2 3 4 7 11
284................................... 1779 4.0596 1 2 3 5 8
285................................... 4921 15.3534 4 7 11 19 29
286................................... 1918 8.9724 3 5 6 10 17
287................................... 6703 15.4899 4 6 10 18 31
288................................... 844 7.9656 3 4 6 8 14
289................................... 5118 4.5346 1 2 3 4 9
290................................... 9053 2.9759 1 2 2 3 5
291................................... 85 1.6235 1 1 1 2 3
292................................... 5313 13.7899 3 5 10 17 27
293................................... 291 6.2509 1 2 5 8 12
294................................... 95175 6.1560 2 3 5 7 11
295................................... 3733 5.1117 1 2 4 6 9
296................................... 226917 7.0173 2 3 5 8 13
297................................... 34165 4.5850 1 2 3 5 8
298................................... 110 3.8636 1 2 3 5 7
299................................... 934 6.1392 1 2 4 7 12
300................................... 14035 7.8248 2 4 6 9 15
301................................... 1905 4.5701 1 2 4 6 8
302................................... 7927 14.0269 6 8 11 16 25
303................................... 18561 11.0121 5 6 9 13 20
304................................... 13534 11.0159 3 5 8 13 22
305................................... 2574 5.2284 1 3 4 6 9
306................................... 12148 7.0957 2 3 5 9 15
307................................... 2922 3.2396 1 2 3 4 5
308................................... 10029 7.5203 1 3 5 9 16
309................................... 3547 3.1844 1 1 2 4 6
310................................... 31805 4.8918 1 2 3 6 10
311................................... 11801 2.3329 1 1 2 3 4
312................................... 2346 5.1206 1 2 3 6 11
313................................... 983 2.5239 1 1 2 3 5
314................................... 1 5.0000 5 5 5 5 5
315................................... 30593 10.2945 1 2 6 13 23
316................................... 65609 7.9880 2 3 6 10 16
317................................... 877 4.0718 1 1 2 4 8
318................................... 6481 7.5303 2 3 5 9 16
319................................... 519 3.4085 1 1 2 4 7
320................................... 179201 7.0307 3 4 5 8 13
321................................... 24147 4.9488 2 3 4 6 8
322................................... 89 5.4270 1 2 4 6 12
323................................... 19263 3.7542 1 2 3 5 7
324................................... 9715 2.2297 1 1 2 3 4
325................................... 8579 4.8887 1 2 4 6 9
326................................... 2581 3.3266 1 2 3 4 6
327................................... 6 1.8333 1 1 1 2 2
328................................... 903 4.3810 1 2 3 5 8
329................................... 147 2.2857 1 1 2 3 5
[[Page 45913]]
331................................... 38189 6.7612 2 3 5 8 13
332................................... 4970 4.0767 1 2 3 5 8
333................................... 346 5.9711 1 2 4 7 14
334................................... 23415 6.8661 4 5 6 8 10
335................................... 10652 5.2443 3 4 5 6 8
336................................... 71694 4.5883 2 2 3 5 8
337................................... 45574 2.9658 1 2 3 4 4
338................................... 6388 5.6464 1 2 4 7 12
339................................... 2672 4.7178 1 2 3 6 10
340................................... 1 2.0000 2 2 2 2 2
341................................... 7825 3.7127 1 2 3 4 7
342................................... 230 4.1783 1 1 2 5 9
344................................... 5318 3.4810 1 1 2 4 7
345................................... 1679 4.6176 1 2 3 5 10
346................................... 5933 7.5142 2 3 5 9 15
347................................... 562 3.4982 1 1 2 4 7
348................................... 3299 5.2716 1 2 4 6 10
349................................... 812 3.1022 1 1 2 4 6
350................................... 7474 5.2455 2 3 4 6 9
352................................... 718 4.2382 1 2 3 5 9
353................................... 2662 9.3963 4 5 7 11 17
354................................... 10561 6.7353 3 4 5 7 12
355................................... 5601 3.9991 3 3 4 5 6
356................................... 36835 3.3217 2 2 3 4 5
357................................... 6765 10.6010 4 5 8 12 19
358................................... 27871 5.0576 3 3 4 6 8
359................................... 26945 3.4724 2 3 3 4 5
360................................... 9750 4.2228 2 2 3 5 7
361................................... 556 4.9730 1 2 3 6 10
363................................... 4977 3.7261 1 2 2 4 7
364................................... 1926 3.8089 1 1 2 5 8
365................................... 2585 8.7060 2 3 6 11 19
366................................... 4794 8.1264 2 3 6 10 17
367................................... 582 3.5481 1 1 2 4 8
368................................... 2177 7.1075 2 3 6 9 13
369................................... 2475 3.8869 1 1 3 5 8
370................................... 1055 5.7261 3 3 4 6 10
371................................... 1020 3.7598 2 3 3 4 5
372................................... 771 3.5175 1 2 2 3 6
373................................... 3627 2.1012 1 1 2 2 3
374................................... 149 2.8389 1 2 2 3 4
375................................... 6 2.6667 1 2 3 3 3
376................................... 198 3.7121 1 1 2 4 8
377................................... 37 4.2973 1 1 2 5 10
378................................... 195 2.8410 1 2 3 4 4
379................................... 358 3.3715 1 1 2 4 7
380................................... 79 1.9747 1 1 1 2 4
381................................... 234 2.0556 1 1 1 2 3
382................................... 62 1.8548 1 1 1 1 2
383................................... 1290 4.3473 1 2 3 5 8
384................................... 129 2.0543 1 1 1 2 4
385................................... 4 9.2500 1 1 7 9 20
389................................... 29 10.3448 1 5 9 14 18
390................................... 20 4.4000 1 2 2 3 7
392................................... 2618 12.0038 4 6 9 15 24
393................................... 4 10.5000 4 4 7 12 19
394................................... 1826 8.4869 1 2 5 10 20
395................................... 69620 5.7869 1 2 4 7 11
396................................... 25 4.1600 1 1 2 5 11
397................................... 14099 6.6178 2 3 5 8 13
398................................... 17210 7.1325 2 4 6 8 13
399................................... 1330 4.5850 1 2 4 6 8
400................................... 8054 11.1912 2 4 8 14 24
401................................... 6917 13.0344 3 5 10 16 27
402................................... 1773 4.3971 1 1 3 6 10
403................................... 34463 9.9275 2 4 7 13 21
404................................... 3962 5.1562 1 2 4 7 10
405................................... 1 1.0000 1 1 1 1 1
406................................... 3686 11.9745 3 5 9 15 24
407................................... 801 4.9189 1 2 4 6 9
[[Page 45914]]
408................................... 3384 8.8230 1 2 5 11 21
409................................... 7060 6.9874 2 3 4 7 15
410................................... 106214 3.3485 1 2 3 4 6
411................................... 53 3.3585 1 1 3 5 7
412................................... 66 2.9394 1 1 2 4 7
413................................... 8956 9.1131 2 4 7 11 19
414................................... 913 5.6396 1 2 4 7 11
415................................... 38353 17.2555 4 8 13 21 34
416................................... 183781 8.8472 2 4 7 11 17
417................................... 43 6.1395 2 3 5 7 13
418................................... 17185 7.2542 2 4 6 9 13
419................................... 16932 6.1817 2 3 5 7 11
420................................... 2916 4.5710 2 2 4 6 8
421................................... 13445 4.8837 2 2 4 6 9
422................................... 88 4.3295 1 2 3 5 9
423................................... 8948 9.3368 3 4 7 11 19
424................................... 2299 19.9696 3 7 13 24 41
425................................... 17710 5.4580 1 2 4 7 11
426................................... 5265 6.2494 1 3 4 8 13
427................................... 2024 5.8384 1 2 4 7 12
428................................... 1016 8.0807 1 3 5 10 17
429................................... 36024 10.3797 2 4 6 11 20
430................................... 59399 10.5850 2 4 8 14 21
431................................... 223 7.5471 2 3 6 9 14
432................................... 499 6.6092 1 2 4 7 13
433................................... 7779 3.7063 1 1 2 4 8
434................................... 21294 6.3439 2 3 5 7 12
435................................... 14719 5.0931 1 3 4 6 9
436................................... 2865 15.4918 4 9 14 21 28
437................................... 14576 11.7871 4 7 10 15 21
439................................... 944 9.2606 1 3 6 11 19
440................................... 4613 10.9638 2 4 7 13 24
441................................... 631 4.2504 1 1 2 4 7
442................................... 13846 9.0475 1 3 6 11 19
443................................... 3731 3.3251 1 1 2 4 7
444................................... 3562 5.7381 2 3 4 7 11
445................................... 1441 3.8709 1 2 3 5 7
447................................... 3613 3.0576 1 1 2 4 6
448................................... 58 1.0000 1 1 1 1 1
449................................... 30844 4.7908 1 2 3 6 10
450................................... 6631 2.5091 1 1 2 3 5
451................................... 8 3.6250 1 1 2 5 7
452................................... 19393 5.6265 1 2 4 7 12
453................................... 3899 3.4047 1 1 2 4 7
454................................... 4486 6.0105 1 2 4 7 12
455................................... 1011 3.4649 1 1 2 4 7
456................................... 199 8.2412 1 1 4 9 20
457................................... 148 5.0811 1 1 1 6 13
458................................... 1702 18.4036 4 8 14 24 37
459................................... 605 13.1818 3 5 8 14 25
460................................... 2470 7.3405 2 3 5 9 15
461................................... 3604 5.4456 1 1 2 5 14
462................................... 10537 14.5672 5 7 13 19 27
463................................... 11242 5.8466 2 3 4 7 11
464................................... 2675 3.9267 1 2 3 5 7
465................................... 257 2.9144 1 1 2 3 5
466................................... 2364 4.5998 1 1 2 4 10
467................................... 2726 4.9409 1 1 2 5 9
468................................... 61159 16.4808 3 7 13 21 32
471................................... 8878 9.6683 4 6 8 11 16
472................................... 187 31.3850 1 5 23 44 72
473................................... 8347 14.9680 2 4 8 23 37
475................................... 89293 12.9142 2 6 10 17 25
476................................... 7977 15.0950 4 8 12 18 27
477................................... 33933 9.3951 1 3 6 12 19
478................................... 118706 9.0006 2 3 7 11 19
479................................... 16953 4.8781 1 2 4 6 9
480................................... 305 33.7836 11 14 22 41 73
481................................... 136 31.1544 18 22 28 37 46
482................................... 7250 16.2116 5 8 12 19 30
[[Page 45915]]
483................................... 36919 49.3175 16 25 39 60 91
484................................... 359 17.1142 2 6 13 22 33
485................................... 3100 13.3335 5 7 10 15 25
486................................... 2297 14.9495 1 6 11 19 30
487................................... 3787 9.8590 2 4 7 12 19
488................................... 1217 18.9836 5 8 14 23 36
489................................... 13239 11.6630 3 4 8 14 24
490................................... 3969 7.3263 1 3 5 8 15
491................................... 9282 4.7884 2 3 4 6 8
492................................... 2077 18.3524 4 5 12 28 38
493................................... 53242 6.1192 1 2 5 8 12
494................................... 28904 2.3069 1 1 1 3 5
495................................... 145 23.2897 9 13 18 26 36
------------------
11003466
--------------------------------------------------------------------------------------------------------------------------------------------------------
Table 7b.--Medicare Prospective Payment System Selected Percentile Lengths of Stay
[FY94 MEDPAR Update 06/95 Grouper V13.0]
--------------------------------------------------------------------------------------------------------------------------------------------------------
Arithmetic 10th
DRG Numberdischarges mean LOS percentile 25thpercentile 50thpercentile 75thpercentile 90thpercentile
--------------------------------------------------------------------------------------------------------------------------------------------------------
001................................... 32563 12.4181 3 5 9 15 25
002................................... 6317 12.5552 3 6 9 15 25
003................................... 1 7.0000 7 7 7 7 7
004................................... 5716 9.9696 2 3 7 13 21
005................................... 69427 5.2597 2 3 4 6 10
006................................... 501 4.0279 1 1 2 4 9
007................................... 10054 14.6588 3 5 9 16 30
008................................... 2662 4.5995 1 1 3 6 10
009................................... 1736 8.2160 2 3 6 10 16
010................................... 20281 8.7667 2 3 6 11 18
011................................... 3161 5.2221 1 2 4 7 11
012................................... 23793 8.6530 2 4 6 10 16
013................................... 6352 6.9216 3 4 5 8 12
014................................... 355976 8.1794 2 4 6 10 15
015................................... 148758 4.9390 2 2 4 6 9
016................................... 11897 7.4574 2 3 5 8 14
017................................... 3558 4.2664 1 2 3 5 8
018................................... 21928 6.8581 2 3 5 8 13
019................................... 7768 4.6881 1 2 4 6 9
020................................... 8255 11.2443 3 5 9 14 22
021................................... 1176 8.6548 2 4 7 11 17
022................................... 3015 5.1035 2 2 4 6 10
023................................... 6002 5.4725 1 2 4 7 11
024................................... 56785 6.4601 2 3 4 7 12
025................................... 23880 4.0990 1 2 3 5 8
026................................... 48 4.4792 1 2 3 5 11
027................................... 3431 7.0982 1 1 4 8 16
028................................... 10184 7.7692 1 3 5 9 16
029................................... 3686 4.3416 1 2 3 5 9
030................................... 1 20.0000 20 20 20 20 20
031................................... 3525 5.6423 1 2 4 6 10
032................................... 2221 3.3417 1 1 2 4 6
034................................... 15768 6.8472 2 3 5 8 14
035................................... 3619 4.7720 1 2 3 6 9
036................................... 12400 1.6868 1 1 1 2 3
037................................... 2216 4.1119 1 1 2 5 8
038................................... 365 2.7342 1 1 2 3 6
039................................... 4054 1.9171 1 1 1 2 4
040................................... 3624 3.5524 1 1 2 4 8
041................................... 1 2.0000 2 2 2 2 2
042................................... 9820 2.1876 1 1 1 2 4
043................................... 132 3.8409 1 2 3 5 7
044................................... 1727 5.8871 2 3 5 7 10
045................................... 2559 4.3118 1 2 3 5 8
046................................... 3246 5.9640 1 3 4 7 11
047................................... 1530 3.9510 1 2 3 5 8
049................................... 2308 7.0156 2 3 5 8 14
[[Page 45916]]
050................................... 3738 2.3767 1 1 2 3 4
051................................... 376 3.0213 1 1 2 3 7
052................................... 89 3.3596 1 1 2 4 7
053................................... 3955 3.7067 1 1 2 4 8
054................................... 2 4.0000 1 1 7 7 7
055................................... 2311 2.9619 1 1 1 3 7
056................................... 788 3.0089 1 1 2 4 6
057................................... 663 4.8763 1 2 3 6 12
059................................... 109 2.9174 1 1 2 3 6
060................................... 2 1.5000 1 1 2 2 2
061................................... 269 5.8513 1 1 3 8 14
063................................... 4451 4.9155 1 2 3 6 10
064................................... 3708 8.1238 1 2 5 10 18
065................................... 35151 3.6832 1 2 3 4 7
066................................... 7326 3.8463 1 2 3 5 7
067................................... 482 4.3320 1 2 3 5 8
068................................... 15027 5.1614 2 3 4 6 9
069................................... 4570 4.0689 2 2 3 5 7
070................................... 20 2.9500 1 1 2 3 4
071................................... 131 4.3282 1 2 4 6 8
072................................... 672 4.6652 1 2 3 5 8
073................................... 6398 5.3993 1 2 4 7 10
074................................... 1 5.0000 5 5 5 5 5
075................................... 39140 11.8686 4 6 9 14 23
076................................... 39373 13.3698 3 6 10 16 25
077................................... 2708 5.8988 1 2 4 8 12
078................................... 27898 8.7011 4 6 8 10 14
079................................... 201195 10.0750 3 5 8 12 19
080................................... 9620 7.1426 3 4 6 9 13
081................................... 15 6.7333 1 2 7 9 14
082................................... 71979 8.4061 2 4 6 11 17
083................................... 7543 6.8481 2 3 5 8 13
084................................... 1658 4.2232 1 2 3 5 7
085................................... 18380 7.8162 2 4 6 10 15
086................................... 1461 4.6283 1 2 4 6 9
087................................... 56282 7.2175 1 3 6 9 14
088................................... 362753 6.5711 2 4 5 8 12
089................................... 446949 7.5767 3 4 6 9 13
090................................... 45881 5.5353 2 3 5 7 9
091................................... 84 6.0238 1 3 4 8 12
092................................... 11454 7.6810 2 4 6 9 14
093................................... 1413 5.2562 2 3 4 7 10
094................................... 10540 8.0123 2 4 6 10 15
095................................... 1192 4.6988 2 3 4 6 8
096................................... 73149 5.9075 2 3 5 7 10
097................................... 29705 4.5723 2 3 4 6 8
098................................... 30 5.1000 2 3 4 8 9
099................................... 26903 3.9009 1 2 3 5 7
100................................... 11202 2.6338 1 1 2 3 5
101................................... 19018 5.9986 2 3 5 7 12
102................................... 3241 4.0040 1 2 3 5 7
103................................... 404 39.0495 10 15 26 51 82
104................................... 22320 16.0147 7 9 14 20 28
105................................... 19215 11.9858 6 7 9 14 21
106................................... 92000 12.7277 7 8 11 15 21
107................................... 59494 9.7554 5 7 8 11 15
108................................... 6459 13.4696 5 7 11 16 25
110................................... 58130 11.5090 3 6 9 14 22
111................................... 5956 7.1711 3 5 7 9 11
112................................... 184483 4.9679 1 2 4 7 10
113................................... 45403 15.9297 4 7 11 19 32
114................................... 8942 10.4369 2 4 8 13 20
115................................... 10550 11.7955 4 7 10 14 21
116................................... 80447 5.8978 1 2 4 7 12
117................................... 4411 4.4493 1 2 3 5 9
118................................... 7528 3.4186 1 1 2 4 7
119................................... 1966 5.9135 1 1 3 7 13
120................................... 42958 10.1097 1 3 6 13 22
121................................... 166593 8.0247 3 5 7 10 14
122................................... 94245 5.5284 1 3 5 7 9
[[Page 45917]]
123................................... 51365 4.8941 1 1 3 6 12
124................................... 140582 5.2192 1 2 4 7 10
125................................... 64357 3.1794 1 1 2 4 6
126................................... 4717 15.9275 4 7 12 20 32
127................................... 703314 6.7118 2 3 5 8 13
128................................... 21635 7.2159 4 5 6 8 11
129................................... 5134 3.7156 1 1 1 4 9
130................................... 88588 7.1348 2 4 6 9 13
131................................... 25955 5.4340 1 3 5 7 9
132................................... 57370 3.9386 1 2 3 5 7
133................................... 5109 3.0803 1 1 2 4 6
134................................... 30488 4.2292 1 2 3 5 8
135................................... 6876 5.6498 1 2 4 7 11
136................................... 1198 3.5993 1 2 3 4 6
137................................... 1 19.0000 19 19 19 19 19
138................................... 203018 4.9328 1 2 4 6 9
139................................... 71858 3.1432 1 2 2 4 6
140................................... 274276 3.8055 1 2 3 5 7
141................................... 76039 5.0041 2 2 4 6 9
142................................... 36892 3.4454 1 2 3 4 6
143................................... 139417 2.8478 1 1 2 3 5
144................................... 65937 6.0300 1 2 4 7 12
145................................... 6907 3.4368 1 2 3 4 7
146................................... 8234 11.7471 6 8 10 13 19
147................................... 1686 7.8713 4 6 8 9 11
148................................... 147371 14.1723 6 8 11 17 25
149................................... 16932 8.1214 5 6 8 9 12
150................................... 23228 12.3597 5 7 10 15 22
151................................... 4775 6.8084 2 4 6 9 12
152................................... 4652 9.6466 4 6 8 11 16
153................................... 1896 6.3771 3 5 6 8 10
154................................... 37655 16.0775 6 8 12 20 30
155................................... 4369 6.6709 2 4 6 8 12
156................................... 7 14.2857 3 7 17 18 22
157................................... 11925 6.0642 1 2 4 7 12
158................................... 6191 2.9616 1 1 2 4 6
159................................... 17740 5.5558 1 3 4 7 11
160................................... 10805 3.0621 1 2 3 4 6
161................................... 16711 4.5214 1 2 3 6 9
162................................... 9822 2.2040 1 1 2 3 4
163................................... 14 5.0000 1 2 3 7 11
164................................... 5233 9.9318 4 6 8 12 17
165................................... 1784 6.0701 3 4 6 7 9
166................................... 3351 6.0624 2 3 5 8 11
167................................... 2343 3.5924 2 2 3 4 6
168................................... 1989 5.6310 1 2 3 7 13
169................................... 1150 2.7374 1 1 2 3 6
170................................... 13122 13.2964 3 6 10 17 27
171................................... 1192 6.1678 1 3 5 8 12
172................................... 32126 8.7343 2 3 6 11 18
173................................... 2391 4.5575 1 2 3 6 9
174................................... 241449 5.9594 2 3 5 7 11
175................................... 26093 3.7730 1 2 3 5 7
176................................... 16136 6.4648 2 3 5 8 12
177................................... 13035 5.4607 2 3 4 7 10
178................................... 4835 3.9305 1 2 3 5 7
179................................... 10795 7.7602 2 4 6 9 14
180................................... 80115 6.5037 2 3 5 8 12
181................................... 23650 4.1622 1 2 4 5 7
182................................... 237691 5.3815 2 3 4 7 10
183................................... 77901 3.7210 1 2 3 5 7
184................................... 81 3.0494 1 1 2 4 6
185................................... 4072 5.7876 1 2 4 7 12
186................................... 4 5.7500 3 3 5 6 9
187................................... 947 3.8353 1 2 3 5 7
188................................... 59776 6.5322 2 3 5 8 13
189................................... 8633 3.8291 1 1 3 5 8
190................................... 90 6.4556 2 3 4 8 14
191................................... 10712 17.3836 5 8 13 22 35
192................................... 907 8.2591 2 5 7 10 15
[[Page 45918]]
193................................... 9602 14.8980 6 8 12 18 27
194................................... 1017 8.5320 3 5 8 11 15
195................................... 11225 11.1842 5 7 9 13 19
196................................... 1014 7.1647 3 5 7 9 11
197................................... 31505 9.6595 4 5 8 11 17
198................................... 9564 5.3496 2 3 5 7 9
199................................... 2540 12.4102 3 6 10 16 24
200................................... 1620 12.6056 2 4 9 16 27
201................................... 1615 16.0904 4 7 12 20 30
202................................... 24533 8.2755 2 4 6 10 16
203................................... 29689 8.2140 2 3 6 10 16
204................................... 48970 7.1515 2 3 5 9 14
205................................... 22181 7.9563 2 3 6 10 16
206................................... 1920 4.9693 1 2 4 6 10
207................................... 37149 6.1056 2 3 5 8 12
208................................... 11509 3.5696 1 2 3 5 7
209................................... 327144 7.6473 4 5 7 9 12
210................................... 136786 9.8010 4 6 8 11 16
211................................... 27783 7.2033 4 5 6 8 11
212................................... 22 5.2273 2 3 4 9 10
213................................... 6859 10.6336 3 4 8 13 21
214................................... 52362 7.3958 2 4 6 9 14
215................................... 42805 4.1898 2 2 3 5 7
216................................... 6776 12.2010 3 5 9 15 25
217................................... 19370 17.0114 3 6 11 20 36
218................................... 23321 6.8681 2 3 5 8 13
219................................... 19759 4.1052 2 2 3 5 7
220................................... 5 4.8000 1 1 3 9 9
221................................... 5000 8.8390 2 4 6 10 17
222................................... 3984 4.2465 1 2 3 5 8
223................................... 20206 3.0441 1 1 2 3 6
224................................... 8998 2.4032 1 1 2 3 4
225................................... 7067 5.0662 1 2 3 6 11
226................................... 5814 7.3156 1 2 5 9 15
227................................... 5364 3.1943 1 1 2 4 6
228................................... 3483 3.8088 1 1 2 4 8
229................................... 1608 2.4254 1 1 2 3 5
230................................... 2717 5.5778 1 2 3 6 12
231................................... 11115 5.5294 1 2 3 7 12
232................................... 661 4.4781 1 1 2 5 10
233................................... 4776 9.8306 2 4 7 12 20
234................................... 2354 4.5242 1 2 3 6 9
235................................... 6118 7.6857 2 3 5 8 15
236................................... 40137 6.9930 2 3 5 8 13
237................................... 1595 4.9292 1 2 4 6 9
238................................... 7380 11.3585 3 5 8 13 22
239................................... 62864 8.3598 3 4 6 10 16
240................................... 11832 8.0401 2 4 6 10 16
241................................... 3284 4.9315 1 2 4 6 9
242................................... 2565 8.8881 3 4 7 11 17
243................................... 88802 6.1276 2 3 5 8 11
244................................... 11514 6.4164 2 3 5 8 12
245................................... 4748 4.5746 1 2 3 6 8
246................................... 1417 4.6789 2 2 4 6 8
247................................... 10573 4.2631 1 2 3 5 8
248................................... 6790 5.7025 2 3 4 7 10
249................................... 9934 4.6467 1 2 3 6 9
250................................... 3475 5.6636 1 2 4 6 11
251................................... 2441 3.2466 1 1 2 4 6
252................................... 1 1.0000 1 1 1 1 1
253................................... 18273 6.5851 2 3 5 8 12
254................................... 10412 4.0742 1 2 3 5 8
255................................... 5 9.0000 3 3 8 10 20
256................................... 9799 4.3950 1 2 3 5 9
257................................... 26246 3.9084 2 2 3 4 7
258................................... 21132 2.7872 1 2 2 3 5
259................................... 4424 4.0995 1 1 2 4 8
260................................... 5371 1.9916 1 1 2 2 3
261................................... 2601 2.5698 1 1 2 3 5
262................................... 810 4.0099 1 1 2 5 9
[[Page 45919]]
263................................... 30957 15.8007 4 7 11 19 31
264................................... 3786 9.1918 3 4 7 11 19
265................................... 4698 7.9208 1 2 5 9 17
266................................... 3049 3.8964 1 1 3 5 8
267................................... 250 4.4360 1 1 2 5 9
268................................... 1194 4.4422 1 1 2 5 9
269................................... 10904 9.9901 2 4 7 13 21
270................................... 4123 3.5986 1 1 2 4 8
271................................... 21708 9.4615 3 5 7 11 17
272................................... 6462 8.0888 2 4 6 10 15
273................................... 1651 6.1024 2 3 4 7 13
274................................... 2629 8.0738 1 3 6 10 16
275................................... 263 3.4563 1 1 2 4 8
276................................... 942 5.4055 2 3 4 7 10
277................................... 80460 7.2966 3 4 6 9 13
278................................... 27732 5.4998 2 3 5 7 9
279................................... 14 5.8571 1 2 4 7 14
280................................... 13633 5.5404 1 2 4 7 10
281................................... 6506 3.9276 1 2 3 5 7
282................................... 1 18.0000 18 18 18 18 18
283................................... 5608 5.9627 2 3 4 7 11
284................................... 1871 4.0823 1 2 3 5 8
285................................... 4921 15.3534 4 7 11 19 29
286................................... 1918 8.9724 3 5 6 10 17
287................................... 6703 15.4899 4 6 10 18 31
288................................... 844 7.9656 3 4 6 8 14
289................................... 5118 4.5346 1 2 3 4 9
290................................... 9053 2.9759 1 2 2 3 5
291................................... 85 1.6235 1 1 1 2 3
292................................... 5300 13.8000 3 5 10 17 27
293................................... 304 6.3980 1 2 5 8 12
294................................... 95175 6.1560 2 3 5 7 11
295................................... 3733 5.1117 1 2 4 6 9
296................................... 226402 7.0218 2 3 5 8 13
297................................... 34680 4.5918 1 2 3 6 8
298................................... 110 3.8636 1 2 3 5 7
299................................... 934 6.1392 1 2 4 7 12
300................................... 13699 7.8699 2 4 6 9 15
301................................... 2241 4.7822 1 2 4 6 9
302................................... 7927 14.0269 6 8 11 16 25
303................................... 18561 11.0121 5 6 9 13 20
304................................... 13350 11.0605 3 5 8 14 22
305................................... 2758 5.3985 1 3 5 7 9
306................................... 12058 7.0994 2 3 5 9 15
307................................... 3012 3.3396 1 2 3 4 6
308................................... 9940 7.5354 1 3 5 9 16
309................................... 3636 3.2492 1 1 2 4 7
310................................... 31553 4.8978 1 2 3 6 10
311................................... 12053 2.3708 1 1 2 3 4
312................................... 2334 5.1127 1 2 3 6 11
313................................... 995 2.5739 1 1 2 3 5
314................................... 1 5.0000 5 5 5 5 5
315................................... 30593 10.2945 1 2 6 13 23
316................................... 65609 7.9880 2 3 6 10 16
317................................... 877 4.0718 1 1 2 4 8
318................................... 6466 7.5396 2 3 5 9 16
319................................... 534 3.4120 1 1 2 4 7
320................................... 175172 7.0612 3 4 6 8 13
321................................... 28176 5.0569 2 3 4 6 8
322................................... 89 5.4270 1 2 4 6 12
323................................... 18929 3.7670 1 2 3 5 7
324................................... 10049 2.2562 1 1 2 3 4
325................................... 8473 4.8960 1 2 4 6 9
326................................... 2687 3.3651 1 2 3 4 6
327................................... 6 1.8333 1 1 1 2 2
328................................... 900 4.3789 1 2 3 5 8
329................................... 150 2.3400 1 1 2 3 5
331................................... 37821 6.7707 2 3 5 8 13
332................................... 5338 4.1948 1 2 3 5 8
333................................... 346 5.9711 1 2 4 7 14
[[Page 45920]]
334................................... 22781 6.8779 4 5 6 8 10
335................................... 11286 5.3115 3 4 5 6 8
336................................... 70900 4.5949 2 2 3 5 8
337................................... 46368 2.9836 1 2 3 4 5
338................................... 6388 5.6464 1 2 4 7 12
339................................... 2672 4.7178 1 2 3 6 10
340................................... 1 2.0000 2 2 2 2 2
341................................... 7825 3.7127 1 2 3 4 7
342................................... 230 4.1783 1 1 2 5 9
344................................... 5318 3.4810 1 1 2 4 7
345................................... 1679 4.6176 1 2 3 5 10
346................................... 5920 7.5142 2 3 5 9 15
347................................... 575 3.5896 1 1 2 4 7
348................................... 3277 5.2820 1 2 4 6 10
349................................... 834 3.1187 1 1 2 4 6
350................................... 7474 5.2455 2 3 4 6 9
352................................... 718 4.2382 1 2 3 5 9
353................................... 2662 9.3963 4 5 7 11 17
354................................... 10205 6.7863 3 4 5 8 12
355................................... 5957 4.0754 3 3 4 5 6
356................................... 36835 3.3217 2 2 3 4 5
357................................... 6765 10.6010 4 5 8 12 19
358................................... 26783 5.0861 3 3 4 6 8
359................................... 28033 3.5067 2 3 3 4 5
360................................... 9750 4.2228 2 2 3 5 7
361................................... 556 4.9730 1 2 3 6 10
363................................... 4977 3.7261 1 2 2 4 7
364................................... 1926 3.8089 1 1 2 5 8
365................................... 2585 8.7060 2 3 6 11 19
366................................... 4743 8.1564 2 3 6 10 17
367................................... 633 3.6919 1 1 2 4 8
368................................... 2177 7.1075 2 3 6 9 13
369................................... 2475 3.8869 1 1 3 5 8
370................................... 1052 5.7253 3 3 4 6 10
371................................... 1023 3.7664 2 3 3 4 5
372................................... 771 3.5175 1 2 2 3 6
373................................... 3627 2.1012 1 1 2 2 3
374................................... 149 2.8389 1 2 2 3 4
375................................... 6 2.6667 1 2 3 3 3
376................................... 198 3.7121 1 1 2 4 8
377................................... 37 4.2973 1 1 2 5 10
378................................... 195 2.8410 1 2 3 4 4
379................................... 358 3.3715 1 1 2 4 7
380................................... 79 1.9747 1 1 1 2 4
381................................... 234 2.0556 1 1 1 2 3
382................................... 62 1.8548 1 1 1 1 2
383................................... 1290 4.3473 1 2 3 5 8
384................................... 129 2.0543 1 1 1 2 4
385................................... 4 9.2500 1 1 7 9 20
389................................... 29 10.3448 1 5 9 14 18
390................................... 20 4.4000 1 2 2 3 7
392................................... 2618 12.0038 4 6 9 15 24
393................................... 4 10.5000 4 4 7 12 19
394................................... 1826 8.4869 1 2 5 10 20
395................................... 69620 5.7869 1 2 4 7 11
396................................... 25 4.1600 1 1 2 5 11
397................................... 14099 6.6178 2 3 5 8 13
398................................... 17056 7.1449 2 4 6 8 13
399................................... 1484 4.7069 1 2 4 6 8
400................................... 8054 11.1912 2 4 8 14 24
401................................... 6822 13.0981 3 5 10 17 27
402................................... 1868 4.6039 1 1 3 6 10
403................................... 34099 9.9506 2 4 7 13 21
404................................... 4326 5.3754 1 2 4 7 11
405................................... 1 1.0000 1 1 1 1 1
406................................... 3631 12.0353 3 5 9 15 24
407................................... 856 5.1145 1 3 4 7 9
408................................... 3384 8.8230 1 2 5 11 21
409................................... 7060 6.9874 2 3 4 7 15
410................................... 106214 3.3485 1 2 3 4 6
[[Page 45921]]
411................................... 53 3.3585 1 1 3 5 7
412................................... 66 2.9394 1 1 2 4 7
413................................... 8869 9.1250 2 4 7 11 19
414................................... 1000 5.8360 1 2 4 7 12
415................................... 38353 17.2555 4 8 13 21 34
416................................... 183781 8.8472 2 4 7 11 17
417................................... 43 6.1395 2 3 5 7 13
418................................... 17185 7.2542 2 4 6 9 13
419................................... 16596 6.2037 2 3 5 7 12
420................................... 3252 4.6248 2 3 4 6 8
421................................... 13445 4.8837 2 2 4 6 9
422................................... 88 4.3295 1 2 3 5 9
423................................... 8948 9.3368 3 4 7 11 19
424................................... 2299 19.9696 3 7 13 24 41
425................................... 17710 5.4580 1 2 4 7 11
426................................... 5265 6.2494 1 3 4 8 13
427................................... 2024 5.8384 1 2 4 7 12
428................................... 1016 8.0807 1 3 5 10 17
429................................... 36024 10.3797 2 4 6 11 20
430................................... 59399 10.5850 2 4 8 14 21
431................................... 223 7.5471 2 3 6 9 14
432................................... 499 6.6092 1 2 4 7 13
433................................... 7779 3.7063 1 1 2 4 8
434................................... 20506 6.3770 2 3 5 7 12
435................................... 15507 5.1130 1 3 4 6 9
436................................... 2865 15.4918 4 9 14 21 28
437................................... 14576 11.7871 4 7 10 15 21
439................................... 944 9.2606 1 3 6 11 19
440................................... 4613 10.9638 2 4 7 13 24
441................................... 631 4.2504 1 1 2 4 7
442................................... 13715 9.0734 1 3 6 11 19
443................................... 3862 3.4270 1 1 2 4 7
444................................... 3496 5.7695 2 3 4 7 11
445................................... 1507 3.8799 1 2 3 5 7
447................................... 3613 3.0576 1 1 2 4 6
448................................... 58 1.0000 1 1 1 1 1
449................................... 30186 4.8263 1 2 3 6 10
450................................... 7289 2.5681 1 1 2 3 5
451................................... 8 3.6250 1 1 2 5 7
452................................... 19238 5.6305 1 2 4 7 12
453................................... 4054 3.4706 1 1 2 4 7
454................................... 4384 6.0557 1 2 4 7 12
455................................... 1113 3.5202 1 1 2 4 7
456................................... 199 8.2412 1 1 4 9 20
457................................... 148 5.0811 1 1 1 6 13
458................................... 1702 18.4036 4 8 14 24 37
459................................... 605 13.1818 3 5 8 14 25
460................................... 2470 7.3405 2 3 5 9 15
461................................... 3604 5.4456 1 1 2 5 14
462................................... 10537 14.5672 5 7 13 19 27
463................................... 10985 5.8645 2 3 4 7 11
464................................... 2932 4.0280 1 2 3 5 7
465................................... 257 2.9144 1 1 2 3 5
466................................... 2364 4.5998 1 1 2 4 10
467................................... 2726 4.9409 1 1 2 5 9
468................................... 61093 16.4858 3 7 13 21 32
471................................... 8878 9.6683 4 6 8 11 16
472................................... 187 31.3850 1 5 23 44 72
473................................... 8347 14.9680 2 4 8 23 37
475................................... 89293 12.9142 2 6 10 17 25
476................................... 7978 15.0978 4 8 12 18 27
477................................... 33998 9.3991 1 3 6 12 19
478................................... 117647 9.0174 2 3 7 11 19
479................................... 18005 5.0104 1 2 4 6 9
480................................... 305 33.7836 11 14 22 41 73
481................................... 136 31.1544 18 22 28 37 46
482................................... 7250 16.2116 5 8 12 19 30
483................................... 36919 49.3175 16 25 39 60 91
484................................... 360 17.1056 2 6 13 22 33
485................................... 3100 13.3335 5 7 10 15 25
[[Page 45922]]
486................................... 2298 14.9500 1 6 11 19 30
487................................... 3794 9.8714 2 4 7 12 19
488................................... 1217 18.9836 5 8 14 23 36
489................................... 13239 11.6630 3 4 8 14 24
490................................... 3969 7.3263 1 3 5 8 15
491................................... 9282 4.7884 2 3 4 6 8
492................................... 2077 18.3524 4 5 12 28 38
493................................... 51794 6.1615 1 2 5 8 12
494................................... 30352 2.4166 1 1 1 3 5
495................................... 145 23.2897 9 13 18 26 36
------------------
11003466
--------------------------------------------------------------------------------------------------------------------------------------------------------
Table 8a.--Statewide Average Operating Cost-To-Charge Ratios for Urban
and Rural Hospitals (Case Weighted) August 1995
------------------------------------------------------------------------
State Urban Rural
------------------------------------------------------------------------
ALABAMA............................................... 0.436 0.484
ALASKA................................................ 0.535 0.721
ARIZONA............................................... 0.459 0.643
ARKANSAS.............................................. 0.552 0.516
CALIFORNIA............................................ 0.438 0.537
COLORADO.............................................. 0.518 0.582
CONNECTICUT........................................... 0.557 0.576
DELAWARE.............................................. 0.533 0.516
DISTRICT OF COLUMBIA.................................. 0.532 .......
FLORIDA............................................... 0.435 0.432
GEORGIA............................................... 0.541 0.540
HAWAII................................................ 0.519 0.553
IDAHO................................................. 0.580 0.673
ILLINOIS.............................................. 0.523 0.605
INDIANA............................................... 0.580 0.633
IOWA.................................................. 0.554 0.716
KANSAS................................................ 0.506 0.688
KENTUCKY.............................................. 0.522 0.562
LOUISIANA............................................. 0.497 0.559
MAINE................................................. 0.613 0.560
MARYLAND.............................................. 0.764 0.806
MASSACHUSETTS......................................... 0.612 0.622
MICHIGAN.............................................. 0.549 0.657
MINNESOTA............................................. 0.583 0.648
MISSISSIPPI........................................... 0.544 0.532
MISSOURI.............................................. 0.474 0.531
MONTANA............................................... 0.544 0.661
NEBRASKA.............................................. 0.529 0.694
NEVADA................................................ 0.343 0.628
NEW HAMPSHIRE......................................... 0.592 0.625
NEW JERSEY............................................ 0.543 .......
NEW MEXICO............................................ 0.485 0.549
NEW YORK.............................................. 0.633 0.721
NORTH CAROLINA........................................ 0.567 0.520
NORTH DAKOTA.......................................... 0.652 0.695
OHIO.................................................. 0.594 0.633
OKLAHOMA.............................................. 0.506 0.572
OREGON................................................ 0.604 0.637
PENNSYLVANIA.......................................... 0.455 0.579
PUERTO RICO........................................... 0.554 0.855
RHODE ISLAND.......................................... 0.615 .......
SOUTH CAROLINA........................................ 0.510 0.524
SOUTH DAKOTA.......................................... 0.563 0.656
TENNESSEE............................................. 0.530 0.569
TEXAS................................................. 0.491 0.593
UTAH.................................................. 0.591 0.648
VERMONT............................................... 0.627 0.611
VIRGINIA.............................................. 0.513 0.549
WASHINGTON............................................ 0.657 0.676
WEST VIRGINIA......................................... 0.577 0.529
WISCONSIN............................................. 0.640 0.706
WYOMING............................................... 0.611 0.765
------------------------------------------------------------------------
Table 8b.--Statewide Average Capital Cost-To-Charge Ratios (Case
Weighted) August 1995
------------------------------------------------------------------------
State Ratio
------------------------------------------------------------------------
ALABAMA........................................................ 0.053
ALASKA......................................................... 0.075
ARIZONA........................................................ 0.062
ARKANSAS....................................................... 0.050
CALIFORNIA..................................................... 0.041
COLORADO....................................................... 0.051
CONNECTICUT.................................................... 0.037
DELAWARE....................................................... 0.055
DISTRICT OF COLUMBIA........................................... 0.043
FLORIDA........................................................ 0.053
GEORGIA........................................................ 0.050
HAWAII......................................................... 0.063
IDAHO.......................................................... 0.075
ILLINOIS....................................................... 0.049
INDIANA........................................................ 0.059
IOWA........................................................... 0.058
KANSAS......................................................... 0.062
KENTUCKY....................................................... 0.059
LOUISIANA...................................................... 0.074
MAINE.......................................................... 0.042
MASSACHUSETTS.................................................. 0.061
MICHIGAN....................................................... 0.059
MINNESOTA...................................................... 0.055
MISSISSIPPI.................................................... 0.055
MISSOURI....................................................... 0.054
MONTANA........................................................ 0.067
NEBRASKA....................................................... 0.061
NEVADA......................................................... 0.036
NEW HAMPSHIRE.................................................. 0.064
NEW JERSEY..................................................... 0.051
NEW MEXICO..................................................... 0.056
NEW YORK....................................................... 0.061
NORTH CAROLINA................................................. 0.048
NORTH DAKOTA................................................... 0.075
OHIO........................................................... 0.061
OKLAHOMA....................................................... 0.059
OREGON......................................................... 0.068
PENNSYLVANIA................................................... 0.047
PUERTO RICO.................................................... 0.090
RHODE ISLAND................................................... 0.027
SOUTH CAROLINA................................................. 0.064
SOUTH DAKOTA................................................... 0.065
TENNESSEE...................................................... 0.057
TEXAS.......................................................... 0.059
UTAH........................................................... 0.050
VERMONT........................................................ 0.050
VIRGINIA....................................................... 0.058
WASHINGTON..................................................... 0.068
WEST VIRGINIA.................................................. 0.058
WISCONSIN...................................................... 0.048
WYOMING........................................................ 0.072
------------------------------------------------------------------------
Table 10.--Percentage Difference in Wage Indexes for Areas That Qualify for a Wage Index Exception for Excluded
Hospitals and Units
----------------------------------------------------------------------------------------------------------------
1982-1992 1984-1992 1988-1992 1990-1992 1991-1992
Area difference difference difference difference difference
----------------------------------------------------------------------------------------------------------------
Rural Connecticut............... 26.405 28.914 10.079 .............. ..............
Rural Hawaii.................... .............. 11.391 .............. .............. ..............
Rural Massachusetts............. 18.481 22.338 .............. .............. '
[[Page 45923]]
Rural New Hampshire............. 9.086 12.861 .............. .............. ..............
Rural New Mexico................ .............. .............. .............. 10.819 ..............
Rural South Carolina............ .............. 8.253 .............. .............. ..............
Albany, GA...................... .............. 10.486 .............. .............. ..............
Anchorage, AK................... .............. .............. .............. 9.498 ..............
Anderson, SC.................... .............. .............. .............. 14.207 ..............
Ann Arbor, MI................... .............. .............. 8.583 .............. ..............
Arecibo, PR..................... .............. .............. 13.672 21.305 18.431
Athens, GA...................... 11.226 16.932 9.859 9.779 ..............
Atlanta, GA..................... .............. 8.942 .............. .............. ..............
Atlantic City, NJ............... .............. 11.027 .............. .............. ..............
Bellingham, WA.................. 11.423 16.929 20.702 13.649 12.901
Bergen-Passaic, NJ.............. 9.510 11.379 13.314 .............. ..............
Biloxi-Gulfport, MS............. .............. 10.148 9.629 11.397 ..............
Boston-Lowell-Brockton-Lawrence-
Salem, MA...................... .............. 10.756 .............. .............. ..............
Bridgeport-Stamford-Norwalk-
Danbury, CT.................... .............. 11.180 .............. .............. ..............
Burlington, NC.................. 12.654 16.034 10.822 .............. ..............
Caguas, PR...................... .............. 18.450 .............. .............. ..............
Charlotte-Gastonia-Rock Hill, NC-
SC............................. 8.386 15.466 .............. .............. ..............
Clarksville-Hopkinsville, TN-KY. .............. .............. .............. 10.392 ..............
Danville, VA.................... .............. 10.958 12.671 .............. ..............
Decatur, AL..................... .............. 10.600 9.169 .............. ..............
Eugene-Springfield, OR.......... .............. 9.207 9.486 17.366 ..............
Fayetteville, NC................ .............. 8.397 .............. .............. ..............
Florence, AL.................... .............. 8.604 .............. .............. ..............
Florence, SC.................... 11.764 10.618 .............. .............. ..............
Gadsden, AL..................... .............. .............. .............. 10.612 ..............
Galveston-Texas City, TX........ .............. .............. 9.164 .............. ..............
Hartford-Middletown-New Britain,
CT............................. 8.970 12.697 .............. .............. ..............
Jackson, TN..................... 8.379 12.579 .............. .............. ..............
Killeen-Temple, TX.............. 19.900 .............. .............. .............. ..............
Lakeland-Winter Haven, FL....... .............. 8.426 8.572 .............. ..............
Las Cruces, NM.................. .............. .............. 11.938 .............. ..............
Lima, OH........................ .............. .............. 9.827 .............. ..............
Longview-Marshall, TX........... .............. 8.646 .............. .............. ..............
Macon-Warner Robins, GA......... .............. 15.225 .............. .............. ..............
Manchester-Nashua, NH........... 11.703 13.083 .............. .............. ..............
McAllen-Edinburg-Mission, TX.... .............. 12.892 12.264 .............. 8.052
Merced, CA...................... .............. 8.186 .............. 8.434 10.359
Middlesex-Somerset-Hunterdon, NJ .............. 8.863 .............. .............. ..............
Midland, TX..................... .............. .............. .............. .............. 9.018
Monmouth-Ocean, NJ.............. .............. 12.517 .............. .............. ..............
Muncie, IN...................... .............. .............. 13.003 .............. ..............
Nassau-Suffolk, NY.............. .............. 12.249 .............. .............. ..............
New Bedford-Fall River-
Attleboro, MA.................. 11.576 14.390 8.311 .............. ..............
New Haven-West Haven-Waterbury,
CT............................. 11.773 16.122 .............. .............. ..............
New London-Norwich, CT.......... 8.025 11.529 .............. .............. ..............
Newark, NJ...................... .............. 10.378 .............. .............. ..............
Oakland, CA..................... .............. 8.361 .............. .............. ..............
Ocala, FL....................... .............. 9.812 .............. .............. ..............
Omaha, NE-IA.................... .............. .............. 8.859 .............. ..............
Orange County, NY............... 15.111 19.315 9.916 .............. ..............
Panama City, FL................. .............. .............. .............. .............. 8.543
Portsmouth-Dover-Rochester, NH.. 8.033 .............. .............. .............. ..............
Poughkeepsie, NY................ .............. 9.961 .............. .............. ..............
Providence-Pawtucket-Woonsocket,
RI............................. .............. 13.272 .............. .............. ..............
Reading, PA..................... .............. .............. 8.479 .............. ..............
Redding, CA..................... .............. 19.139 11.715 .............. ..............
Richland-Kennewick, WA.......... .............. .............. .............. 8.544 ..............
Salinas-Seaside-Monterey, CA.... 14.360 13.360 9.278 8.053 ..............
Santa Cruz, CA.................. 13.053 13.136 8.972 9.313 ..............
Santa Fe, NM.................... 14.139 17.074 21.439 11.136 ..............
Sarasota, FL.................... .............. 9.833 .............. .............. ..............
Vallejo-Fairfield-Napa, CA...... .............. 9.859 .............. 8.054 ..............
Wilmington, DE-NJ-MD............ .............. 9.972 .............. .............. ..............
Worcester-Fitchburg-Leomister,
MA............................. 10.995 18.031 .............. .............. ..............
Yuma, AZ........................ .............. .............. 9.850 .............. 12.611
----------------------------------------------------------------------------------------------------------------
[[Page 45924]]
Appendix A--Regulatory Impact Analysis
I. Introduction
We generally prepare a regulatory flexibility analysis that is
consistent with the Regulatory Flexibility Act (RFA) (5 U.S.C. 601
through 612), unless the Secretary certifies that a final rule would
not have a significant economic impact on a substantial number of small
entities. For purposes of the RFA, we consider all hospitals to be
small entities.
Also, section 1102(b) of the Act requires the Secretary to prepare
a regulatory impact analysis for any final rule that may have a
significant impact on the operations of a substantial number of small
rural hospitals. Such an analysis must conform to the provisions of
section 603 of the RFA. With the exception of hospitals located in
certain New England counties, for purposes of section 1102(b) of the
Act, we define a small rural hospital as a hospital with fewer than 100
beds that is located outside of a Metropolitan Statistical Area (MSAs)
or New England County Metropolitan Area (NECMA). Section 601(g) of the
Social Security Amendments of 1983 (Public Law 98-21) designated
hospitals in certain New England counties as belonging to the adjacent
NECMA. Thus, for purposes of the prospective payment system, we
classified these hospitals as urban hospitals.
It is clear that the changes discussed in this document will affect
both a substantial number of small rural hospitals as well as other
classes of hospitals, and the effects on some may be significant.
Therefore, the discussion below, in combination with the rest of this
final rule, constitutes a combined regulatory impact analysis and
regulatory flexibility analysis.
II. Changes in the Final Rule
With respect to the prospective payment system for capital-related
costs, the major change in this final rule compared to the proposed
rule is our decision not to proceed with the adjustment for capital-
related taxes. We discuss the reasons for that decision in section V.B
of the preamble to this final rule. With respect to the prospective
payment system for operating costs, there are no significant policy
changes in this final rule compared to the proposed rule.
Otherwise, the differences in the impact analysis of this final
rule compared to that in the proposed rule are the result of using more
recent or more complete hospital data. For example, a more complete FY
1994 MedPAR file (June 1995 update) is now available compared to the
one available at the time of the proposed rule. In addition, more
recent hospital-specific data, including cost reports, are used in this
analysis. Finally, the final geographic reclassifications are included.
Our most recent hospital market basket forecast for prospective
payment system hospitals, 3.5 percent, is unchanged from that reported
in the proposed rule. However, the latest forecast for the excluded
hospital market basket has decreased from 3.6 percent to 3.4 percent.
Therefore, the applicable update factor for prospective payment
hospital operating payments is unchanged from the proposed rule while
the update factor for excluded hospitals and units has decreased by 0.2
percentage points from the proposed.
III. Limitations of Our Analysis
As has been the case in previously published regulatory impact
analyses, the following quantitative analysis presents the projected
effects of our policy changes, as well as statutory changes effective
for FY 1996, on various hospital groups. We estimate the effects of
each policy change by estimating payments while holding all other
payment variables constant. We use the best data available, but we do
not attempt to predict behavioral responses to our policy changes, and
we do not make adjustments for future changes in such variables as
admissions, lengths of stay, or case mix.
We received no comments on the methodology used for the impact
analysis in the proposed rule.
IV. Hospitals Included In and Excluded From the Prospective Payment
System
The prospective payment systems for hospital inpatient operating
and capital-related costs encompass nearly all general, short-term,
acute care hospitals that participate in the Medicare program. There
were 46 Indian Health Service Hospitals in our database, which we
excluded from the analysis due to the special characteristics of the
payment method for these hospitals. We also excluded the 49 short-term,
acute care hospitals in Maryland from our analysis. These hospitals
remain excluded from the prospective payment system under the waiver at
section 1814(b)(3) of the Act. (As of January 1, 1995, the hospitals
participating in the New York Finger Lakes demonstration project began
to be paid under the prospective payment system.) Thus, as of August
1995, just over 5,200 hospitals were receiving prospectively based
payments for furnishing inpatient services. This represents about 82
percent of all Medicare-participating hospitals. The majority of this
impact analysis focuses on this set of hospitals.
The remaining 18 percent are specialty hospitals that are excluded
from the prospective payment system and continue to be paid on the
basis of their reasonable costs, subject to a rate-of-increase ceiling
on their inpatient operating costs per discharge. These hospitals
include psychiatric, rehabilitation, long-term care, children's, and
cancer hospitals. The impact on these hospitals of the changes
implemented in this final rule is discussed below.
V. Impact on Excluded Hospitals and Units
As of August 1995, just over 1,100 specialty hospitals are excluded
from the prospective payment system and are instead paid on a
reasonable cost basis subject to the rate-of-increase ceiling under
Sec. 413.40. In addition, approximately 2,250 psychiatric and
rehabilitation units in hospitals that are subject to the prospective
payment system are excluded from the prospective payment system and
paid in accordance with Sec. 413.40.
In accordance with section 1886(b)(3)(B)(ii)(V) of the Act, the
update factor applicable to the rate-of-increase limit for excluded
hospitals and units for FY 1996 is the hospital market basket minus 1.0
percentage point, adjusted to account for the relationship between the
hospital's allowable operating cost per case and its target amounts. We
are currently projecting an increase in the excluded hospital market
basket of 3.4 percent.
The impact on excluded hospitals and units of the proposed update
in the rate-of-increase limit depends on the cumulative cost increases
experienced by each excluded hospital and excluded unit since its
applicable base period. For excluded hospitals and units that have
maintained their cost increases at a level below the percentage
increases in the rate-of-increase limits since their base period, the
major effect will be on the level of incentive payments these hospitals
and units receive. Conversely, for excluded hospitals and units with
per-case cost increases above the cumulative update in their rate-of-
increase limit, the major effect will be the amount of excess costs
that the hospitals would have to absorb.
In this context, we note that, under Sec. 413.40(d)(3), an excluded
hospital or unit whose costs exceed the rate-of-increase limit may
receive the lower of its rate-of-increase ceiling plus 50 percent of
reasonable costs in excess of
[[Page 45925]]
the ceiling, or 110 percent of its ceiling. In addition, under the
various provisions set forth in Sec. 413.40, excluded hospitals and
units may obtain payment adjustments for significant, yet justifiable,
increases in operating costs that exceed the limit. At the same time,
however, by generally limiting payment increases, we continue to
provide an incentive for excluded hospitals and units to restrain the
growth in their spending for patient services.
VI. Impact of Changes In the Operating Prospective Payment System
A. Basis and Methodology of Estimates
In this final rule, we are implementing policy changes and payment
rate updates for the prospective payment systems for operating and
capital-related costs. We have prepared separate analyses of the
changes to each system, beginning with changes to the operating
prospective payment system.
The data used in developing the quantitative analyses presented
below are taken from the FY 1994 MedPAR file (updated through June
1995) and the most current provider-specific file that is used for
payment purposes. Although the analyses of the changes to the operating
prospective payment system do not incorporate any actual cost data, the
most recently available hospital cost report data were used to create
some of the variables by which hospitals are categorized. Our analysis
has several qualifications. First, we do not make adjustments for
behavioral changes that hospitals may adopt in response to these policy
changes. Second, due to the interdependent nature of the prospective
payment system, it is very difficult to precisely quantify the impact
associated with a given change. Third, we draw upon various sources for
the data used to categorize hospitals in the tables. In some cases,
particularly the number of beds, there is a fair degree of variation in
the data from different sources. We have attempted to construct these
variables with the best available source overall. For individual
hospitals, however, some miscategorizations are possible.
Using cases in the FY 1994 MedPAR file, we simulated payments under
the operating prospective payment system given various combinations of
payment parameters. Any short-term, acute care hospitals not paid under
the general prospective payment systems (Indian Health Service
Hospitals and hospitals in Maryland) are excluded from the simulations.
Payments under the capital prospective payment system, or payments for
costs other than inpatient operating costs, are not analyzed here.
Estimated payment impacts of the FY 1996 changes to the capital
prospective payment system are discussed below in section VII of
Appendix A.
The changes discussed separately below are the following:
The effects of the annual reclassification of diagnoses
and procedures and the recalibration of the diagnosis-related group
(DRG) relative weights required by section 1886(d)(4)(C) of the Act.
The effects of changes in hospital wage index values
reflecting the wage index update.
The effects of changing the transfer payment policy to a
graduated per diem payment methodology.
The effects of geographic reclassifications by the
Medicare Geographic Classification Review Board (MGCRB) that are
effective in FY 1996.
The effects of phasing out payments for extraordinarily
lengthy cases (day outlier cases) (with a corresponding increase in
payments for extraordinarily costly cases (cost outliers)), in
accordance with section 1886(d)(5)(A)(v) of the Act.
The total change in payments based on FY 1996 policies
relative to payments based on FY 1995 policies.
To illustrate the impacts of the FY 1996 changes, our FY 1996
baseline simulation model uses: the FY 1995 GROUPER (version 12.0); the
FY 1995 wage indexes; the current uniform per diem transfer payment
policy; no effects of FY 1996 reclassifications; and current outlier
policy (25 percent phase-out of day outlier payments). Outliers are
estimated to be 5.1 percent of total DRG payments.
Each policy change is then added incrementally to this baseline
model, finally arriving at an FY 1996 model incorporating all of the
changes. This allows us to isolate the effects of each change.
Our final comparison illustrates the percent change in payments per
case from FY 1995 to FY 1996. Three factors not displayed in the
previous five columns have significant impacts here. First is the
update to the standardized amounts. In accordance with section
1886(d)(3)(A)(iv) of the Act, we are updating the large urban and the
other areas average standardized amounts for FY 1996 using the most
recent forecasted hospital market basket increase for FY 1996 of 3.5
percent, minus 2.0 percentage points. Thus, the update to the large
urban and other areas' standardized amounts is 1.5 percent. Similarly,
section 1886(b)(3)(C)(ii) of the Act provides that the update factor
applicable to the hospital-specific rates for sole community hospitals
(SCHs) and essential access community hospitals (EACHs) (which are
treated as SCHs for payment purposes) is also the market basket
increase minus 2.0 percent, or 1.5 percent.
A second significant factor impacting upon changes in payments per
case from FY 1995 to FY 1996 is a change in MGCRB reclassification
status from one year to the next. That is, hospitals reclassified in FY
1995 that are no longer reclassified in FY 1996 may have a negative
payment impact going from FY 1995 to FY 1996; conversely, hospitals not
reclassified in FY 1995 and reclassified in FY 1996 may have a positive
payment impact from FY 1995 to FY 1996. In some cases these impacts can
be quite substantial, so that a relatively few number of hospitals in a
particular category that lost their reclassification status can hold
the average percentage change for the category below the mean.
Third, when comparing our estimated FY 1995 payments to FY 1996
payments, another significant consideration is that we currently
estimate that actual outlier payments during FY 1995 will be 4.0
percent of actual total DRG payments. When the FY 1995 final rule was
published September 1, 1994 (59 FR 45330), we estimated that FY 1995
outlier payments would be 5.1 percent of total DRG payments, and the
standardized amounts were reduced correspondingly. The effects of the
lower than expected outlier payments during FY 1995 are reflected in
the analyses below comparing our current estimates of FY 1995 total
payments to estimated FY 1996 payments.
Table I demonstrates the results of our analysis. The table
categorizes hospitals by various geographic and special payment
consideration groups to illustrate the varying impacts on different
types of hospitals. The top row of the table shows the overall impact
on the 5,207 hospitals included in the analysis. This is 47 fewer
hospitals than were included in the impact analysis in the FY 1995
final rule (59 FR 45496). Data for 106 hospitals that were included in
last year's analysis were not available for analysis this year;
however, data were available this year for 54 hospitals for which data
were not available last year. In addition, 5 hospitals previously
excluded from our analysis because they were participating in the
Finger Lakes demonstration project are included in our analysis this
year because the demonstration authority has expired and these
[[Page 45926]]
hospitals are now being paid under the prospective payment system.
The next four rows of Table I contain hospitals categorized
according to their geographic location (all urbans as well as large
urban and other urban or rural). There are 2,942 hospitals located in
urban areas (MSAs or NECMAs) included in our analysis. Among these,
there are 1,647 hospitals located in large urban areas (populations
over 1 million), and 1,295 hospitals in other urban areas (populations
of 1 million or fewer). In addition, there are 2,265 hospitals in rural
areas. The next two groupings are by bed size categories, shown
separately for urban and rural hospitals. The final groupings by
geographic location are by census divisions, also shown separately for
urban and rural hospitals.
The second part of Table I shows changes in payments based on
hospitals' FY 1996 payment classifications, including any
reclassifications under section 1886(d)(10) of the Act. For example,
the rows labeled urban, large urban, other urban, and rural show the
numbers of hospitals being paid based on these categorizations, after
consideration of geographic reclassifications, are 3,152; 1,835; 1,317;
and 2,055, respectively.
The next three groupings examine the impacts of the changes on
hospitals grouped by whether or not they have residency programs
(teaching hospitals that receive an indirect medical education (IME)
adjustment), receive disproportionate share (DSH) payments, or both.
There are 4,135 nonteaching hospitals in our analysis, 841 with fewer
than 100 residents, and 231 with 100 or more residents.
In the DSH categories, hospitals are grouped according to their DSH
payment status. In the past, we have included as urban hospitals those
that are located in a rural area but were reclassified as urban by the
MGCRB for purposes of the standardized amount, since they have been
considered urban in determining the amount of their DSH adjustment.
This year, however, we have isolated these hospitals in separate rows
to identify the payment impacts of reclassification solely for DSH. In
these rows, labeled ``Large Urban and DSH'' and ``DSH Only,'' under the
heading ``Reclassified Rural DSH,'' we group reclassified rural
hospitals that receive DSH after reclassification based on whether they
also receive the higher large urban amount, or are only benefitting
from reclassification to an other urban area by receiving higher DSH
payments. Hospitals in the rural DSH categories, therefore, including
those in the rural referral center (RRC) and SCH categories, represent
hospitals that were not reclassified for purposes of the standardized
amount. They may, however, have been reclassified for purposes of
assigning the wage index. The next category groups hospitals paid on
the basis of the urban standardized amount in terms of whether they
receive the IME adjustment, the DSH adjustment, both, or neither.
The next four rows examine the impacts of the changes on rural
hospitals by special payment groups (SCHs, RRCs, and EACHs). Rural
hospitals reclassified for FY 1996 for purposes of the standardized
amount are not included here.
The RRCs (91), SCH/EACHs (623), and SCH/EACHs and RRCs (39) shown
here were not reclassified for purposes of the standardized amount.
There are 5 SCH/EACHs included in our analysis and 4 EACH/RRCs.
There are 7 RRCs and 12 SCHs that will be reclassified for the
standardized amount in FY 1996 and are therefore not included in these
rows. In addition, two hospitals that are SCH/RRCs will be reclassified
for the standardized amount (one of these hospitals will also be
reclassified for the wage index).
The next two groupings are based on type of ownership and the
hospital's Medicare utilization expressed as a percent of total patient
days. These data are taken from the FY 1993 Medicare cost report files,
the latest available. Data needed to calculate Medicare utilization
percentages were unavailable for 122 hospitals. For the most part,
these are either new hospitals or hospitals filing manual cost reports
that are not yet entered into the data base.
The next series of groupings concern the geographic reclassication
status of hospitals. The first three groupings display hospitals that
were reclassified by the MGCRB for either FY 1995 or FY 1996, or for
both years, by urban/rural status. The next rows illustrate the overall
number of reclassifications, as well as the numbers of reclassified
hospitals grouped by urban and rural location. The final row in Table I
contains hospitals located in rural counties but deemed to be urban
under section 1886(d)(8)(B) of the Act.
Table I.--Impact Analysis of Changes for FY 1996 Operating Prospective Payment System
[Percent changes in payments per case]
Day
Num. of DRG New wage New MGCRB outlier All FY
hosps.\1\ recalibration data \3\ transfer reclassification policy 1996
\2\ policy \4\ \5\ changes changes
(0) (1) (2) (3) (4) (5) (6)
--------------------------------------------------------------------------------------------------------------------------------------------------------
(BY GEOGRAPHIC LOCATION)
--------------------------------------------------------------------------------------------------------------------------------------------------------
ALL HOSPITALS........................................ 5,207 0.0 0.0 0.0 0.0 0.0 2.6
URBAN HOSPITALS...................................... 2,942 0.0 -0.1 0.0 -0.4 0.0 2.5
LARGE URBAN...................................... 1,647 0.1 -0.3 0.0 -0.5 -0.1 2.2
OTHER URBAN...................................... 1,295 -0.1 0.4 0.0 -0.1 0.1 3.0
RURAL HOSPITALS...................................... 2,265 0.2 0.3 0.3 2.3 0.0 3.1
BED SIZE (URBAN):
0-99 BEDS........................................ 755 0.1 0.0 0.3 -0.5 0.2 2.8
100-199 BEDS..................................... 925 0.1 0.2 0.1 -0.4 0.1 3.0
200-299 BEDS..................................... 595 0.0 0.0 0.0 -0.3 0.0 2.7
300-499 BEDS..................................... 489 0.0 -0.1 -0.1 -0.4 0.0 2.4
500 OR MORE BEDS................................. 178 0.0 -0.3 -0.2 -0.3 -0.3 2.0
BED SIZE (RURAL):
0-49 BEDS........................................ 1,179 0.3 0.1 0.6 0.0 0.0 3.1
50-99 BEDS....................................... 665 0.2 0.2 0.4 0.9 0.1 3.4
100-149 BEDS..................................... 227 0.1 0.4 0.3 3.1 0.1 2.6
150-199 BEDS..................................... 109 0.2 0.2 0.1 2.8 0.0 3.3
200 OR MORE BEDS................................. 85 0.0 0.4 0.0 5.4 0.0 3.2
[[Page 45927]]
URBAN BY CENSUS DIVISION:
NEW ENGLAND...................................... 164 0.2 -0.3 0.0 -0.2 -0.2 2.1
MIDDLE ATLANTIC.................................. 441 0.4 -0.6 -0.1 -0.4 -0.8 1.8
SOUTH ATLANTIC................................... 435 0.0 0.1 0.0 -0.5 0.1 2.6
EAST NORTH CENTRAL............................... 490 -0.1 -0.1 0.0 -0.1 0.2 2.6
EAST SOUTH CENTRAL............................... 164 -0.2 0.1 -0.1 -0.4 0.2 2.7
WEST NORTH CENTRAL............................... 196 -0.1 -0.7 -0.1 -0.5 0.3 1.9
WEST SOUTH CENTRAL............................... 387 -0.3 0.7 -0.1 -0.5 0.3 3.7
MOUNTAIN......................................... 132 -0.1 -0.5 -0.1 -0.4 0.3 2.2
PACIFIC.......................................... 485 -0.1 0.4 0.0 -0.5 0.2 2.8
PUERTO RICO...................................... 48 0.0 2.7 -0.2 -0.5 0.0 5.5
RURAL BY CENSUS DIVISION:
NEW ENGLAND...................................... 53 0.3 0.5 0.1 1.3 0.1 3.8
MIDDLE ATLANTIC.................................. 84 0.5 -0.5 0.1 1.5 -0.3 3.0
SOUTH ATLANTIC................................... 300 0.1 0.6 0.3 3.2 0.0 3.0
EAST NORTH CENTRAL............................... 305 0.2 0.5 0.4 1.9 0.1 3.6
EAST SOUTH CENTRAL............................... 278 0.0 0.8 0.4 3.7 0.0 3.5
WEST NORTH CENTRAL............................... 529 0.2 -0.2 0.3 2.0 0.1 2.9
WEST SOUTH CENTRAL............................... 354 0.1 -0.4 0.3 3.1 0.1 2.6
MOUNTAIN......................................... 214 0.3 -0.1 0.1 -0.1 0.1 2.2
PACIFIC.......................................... 143 0.3 0.6 0.2 1.4 0.1 3.4
PUERTO RICO...................................... 5 0.4 -0.6 -0.1 -0.5 0.1 2.3
--------------------------------------------------------------------------------------------------------------------------------------------------------
(BY PAYMENT CATEGORIES)
--------------------------------------------------------------------------------------------------------------------------------------------------------
URBAN HOSPITALS...................................... 3,152 0.0 0.0 0.0 -0.2 0.0 2.5
LARGE URBAN...................................... 1,835 0.1 -0.3 0.0 -0.3 -0.1 2.3
OTHER URBAN...................................... 1,317 -0.1 0.4 0.0 -0.2 0.1 3.0
RURAL HOSPITALS...................................... 2,055 0.2 0.2 0.3 1.6 0.0 2.8
TEACHING STATUS:
NON-TEACHING..................................... 4,135 0.1 0.1 0.1 0.3 0.1 3.0
LESS THAN 100 RES................................ 841 0.0 0.0 -0.1 -0.3 0.0 2.5
100+ RESIDENTS................................... 231 0.0 -0.4 -0.1 -0.3 -0.4 1.8
DISPROPORTIONATE SHARE HOSPITALS (DSH):
NON-DSH.......................................... 3,234 0.1 0.0 0.1 0.1 0.1 2.8
URBAN DSH:
100 BEDS OR MORE............................. 1,370 0.0 0.0 -0.1 -0.4 -0.1 2.3
FEWER THAN 100 BEDS.......................... 120 0.0 0.2 0.3 -0.6 0.2 3.3
RECLASSIFIED RURAL DSH:
LARGE URBAN AND DSH.......................... 22 0.0 0.2 0.1 11.1 0.1 5.9
DSH ONLY..................................... 69 0.1 0.5 0.2 8.6 0.0 5.0
RURAL DSH:
SOLE COMMUNITY (SCH)......................... 136 0.2 0.0 0.1 0.1 0.0 2.1
REFERRAL CENTERS (RRC)....................... 29 0.1 0.4 0.1 3.0 -0.2 2.9
OTHER RURAL DSH HOSP.:
100 BEDS OR MORE............................. 82 0.1 0.5 0.4 2.2 0.1 1.5
FEWER THAN 100 BEDS.......................... 145 0.0 0.7 0.7 0.1 0.1 3.6
URBAN TEACHING AND DSH:
BOTH TEACHING AND DSH............................ 667 0.0 -0.1 -0.1 -0.5 -0.3 2.1
TEACHING AND NO DSH.............................. 356 0.0 -0.1 -0.1 -0.2 0.0 2.5
NO TEACHING AND DSH.............................. 914 0.0 0.2 0.0 0.2 0.1 3.0
NO TEACHING AND NO DSH........................... 1,215 0.1 -0.1 0.1 -0.3 0.2 3.0
RURAL HOSPITAL TYPES:
NONSPECIAL STATUS:
HOSPITALS.................................... 1,302 0.2 0.4 0.6 1.4 0.1 2.9
RRC.......................................... 91 0.1 0.3 0.1 4.9 0.1 3.5
SCH/EACH..................................... 623 0.3 0.0 0.1 0.0 0.0 2.2
SCH/EACH AND RRC............................. 39 0.2 0.0 0.0 0.3 -0.1 2.2
TYPE OF OWNERSHIP:
VOLUNTARY........................................ 3,149 0.1 -0.1 0.0 -0.1 -0.1 2.5
PROPRIETARY...................................... 718 -0.1 0.0 0.0 0.3 0.2 2.9
GOVERNMENT....................................... 1,340 0.0 0.2 0.1 0.3 0.0 2.9
MEDICARE UTILIZATION AS A PERCENT OF INPATIENT DAYS:
0-25............................................. 267 0.0 -0.3 0.0 -0.1 -0.2 2.1
25-50............................................ 1,356 0.0 0.0 -0.1 -0.3 -0.1 2.3
[[Page 45928]]
50-65............................................ 2,217 0.1 0.1 0.0 0.1 0.0 2.8
OVER 65.......................................... 1,245 0.2 -0.1 0.1 0.1 0.0 2.7
UNKNOWN.......................................... 122 0.4 -0.5 0.0 -0.1 -1.2 1.7
--------------------------------------------------------------------------------------------------------------------------------------------------------
HOSPITALS RECLASSIFIED BY THE MEDICARE GEOGRAPHIC REVIEW BOARD
--------------------------------------------------------------------------------------------------------------------------------------------------------
RECLASSIFICATION STATUS DURING FY95 AND FY96:
RECLASSIFIED DURING BOTH FY95 AND FY96........... 453 0.1 0.3 0.1 4.8 0.0 2.9
URBAN........................................ 163 0.1 0.2 0.0 2.7 0.0 3.0
RURAL........................................ 290 0.1 0.3 0.2 8.0 0.1 2.9
RECLASSIFIED DURING FY96 ONLY.................... 147 0.2 0.1 0.1 4.0 0.0 8.4
URBAN........................................ 31 0.3 -0.1 0.1 2.1 -0.2 7.7
RURAL........................................ 116 0.1 0.3 0.2 5.6 0.1 9.0
RECLASSIFIED DURING FY95 ONLY.................... 284 0.0 0.1 0.0 -1.4 0.1 -0.7
URBAN........................................ 112 0.0 0.1 -0.1 -1.8 0.1 -0.4
RURAL........................................ 172 0.2 0.1 0.3 -0.4 0.1 -1.5
FY 96 RECLASSIFICATIONS:
ALL RECLASSIFIED HOSP............................ 602 0.1 0.2 0.1 4.7 0.0 4.0
STAND. AMOUNT ONLY........................... 210 0.1 0.6 0.1 2.0 0.0 3.9
WAGE INDEX ONLY.............................. 258 0.1 0.2 0.1 7.1 0.0 4.3
BOTH......................................... 134 0.1 -0.1 0.0 4.3 0.0 3.8
NONRECLASSIFIED.............................. 4,578 0.0 0.0 0.0 -0.6 0.0 2.4
ALL URBAN RECLASS................................ 195 0.1 0.2 0.0 2.6 0.0 3.7
STAND. AMOUNT ONLY........................... 68 0.0 0.7 0.0 0.8 0.0 3.7
WAGE INDEX ONLY.............................. 35 0.1 0.1 -0.1 5.9 -0.2 4.8
BOTH......................................... 92 0.1 -0.2 0.0 2.0 0.0 3.0
NONRECLASSIFIED.............................. 2,747 0.0 -0.1 0.0 -0.6 0.0 2.4
ALL RURAL RECLASS................................ 407 0.1 0.3 0.2 7.4 0.1 4.4
STAND. AMOUNT ONLY........................... 142 0.1 0.4 0.3 3.8 0.0 4.1
WAGE INDEX ONLY.............................. 223 0.1 0.2 0.2 7.9 0.1 4.0
BOTH......................................... 42 0.0 0.5 0.1 13.1 0.1 6.3
NONRECLASSIFIED.............................. 1,831 0.2 0.2 0.3 -0.4 0.0 2.4
OTHER RECLASSIFED HOSPITALS (SECTION 1886(d)(8)(B)).. 27 0.1 0.0 0.4 -0.1 0.1 3.3
\1\ Because data necessary to classify some hospitals by category were missing, the total number of hospitals in each category may not equal the
national total. Discharge data are from FY 1994, and hospital cost report data are from reporting periods beginning in FY 1992 and FY 1993.
\2\ This column displays the payment impacts of the recalibration of the DRG weights, based on FY 1994 MedPAR data and the DRG classification changes,
in accordance with section 1886(d)(4)(C) of the Act.
\3\ This column shows the payment effects of updating the data used to calculate the wage index with data from the FY 1992 cost reports.
\4\ This column displays the payment impacts of revising the per diem methodology for transfer cases from the current flat per diem methodology to a
graduated per diem methodology.
\5\ Shown here are the combined effects of geographic reclassification by the Medicare Geographic Classification Review Board (MGCRB). The effects shown
here demonstrate the FY 1996 payment impacts of going from no reclassifications to the reclassifications scheduled to be in effect for FY 1996.
Reclassification for prior years has no bearing on the payment impacts shown here.
\6\ This column illustrates the payment impacts of our changes affecting payments for outliers, in accordance with section 1886(d)(5) of the Act.
\7\ This column shows changes in payments from FY 1995 to FY 1996. It incorporates all of the changes displayed in columns 1 through 5. It also displays
the impacts of the updates to the FY 1996 standardized amounts, changes in hospitals' reclassification status in FY 1996 compared to FY 1995, and the
difference in outlier payments from FY 1995 to FY 1996. The sum of the first five columns plus these effects may be slightly different from the
percentage changes shown here, due to rounding errors and interactive effects.
B. The Impact of the Changes to the DRG Weights (Column 1)
In column 1 of Table I, we present the combined effects of the
revised DRG classification system, and the subsequent recalibration of
the DRG weights incorporating these revised DRGs, as discussed in
section II of the preamble to this final rule. Section 1886(d)(4)(C)(i)
of the Act requires us each year to make appropriate classification
changes and to recalibrate the DRG weights in order to reflect changes
in treatment patterns, technology, and any other factors that may
change the relative use of hospital resources. The impact of
reclassification and recalibration on aggregate payments is required by
section 1886(d)(4)(C)(iii) of the Act to be budget neutral.
The first row of Table I shows that the overall effect of these
changes is budget neutral. That is, the percentage change when adding
the FY 1996 GROUPER (version 13.0) to the FY 1996 baseline is 0.0. As
described previously, all of the other payment parameters are held
constant for the comparison in column 1, only the version of the
GROUPER is different.
Consistent with the minor changes we are making to the FY 1996
GROUPER, the redistributional impacts across hospital groups are very
small (an increase of 0.1 for large urban and 0.2 for rural hospitals
and a decrease of 0.1 for other urban hospitals). Among other hospital
categories, the net effects are
[[Page 45929]]
positive changes for small and medium-size (up to 200 beds) rural
hospitals and slightly positive changes for small (up to 200 beds)
urban hospitals.
The largest single effect on any of the hospital categories
examined is a 0.5 percent increase for rural hospitals in the Middle
Atlantic census division. We note that urban hospitals in this census
division also show a positive increase, 0.4 percent. We attribute this
to the changes in our methodology for identifying the statistical
outliers that are eliminated from the data used to recalibrate the DRG
weights (described in section II.C of the preamble to this final rule).
In previous recalibrations, we eliminated all cases outside 3.0
standard deviations from the geometric mean of standardized charges per
case for each DRG. In the DRG recalibration set forth in this final
rule, we eliminated only cases that met both this current criterion and
an additional criterion that the cases fall outside 3.0 standard
deviations from the geometric mean of standardized charges per day for
each DRG. Because hospitals in the Middle Atlantic census division have
longer lengths of stay (as demonstrated by the impacts of phasing out
the day outliers--see the discussion below concerning column 5), they
would be likely to have cases that exceed the 3.0 standard deviation
threshold for average charges per case but not the per day threshold.
Thus, costly cases previously eliminated would be left in the
recalibration, thereby influencing the weights of the DRGs to which
they are assigned.
We also note that rural hospitals in Puerto Rico experience a 0.4
increase in payments. This is a function of the fact that only five
hospitals are included in this category, making it susceptible to the
influence of two hospitals whose case-mix index values increased by 0.8
percent.
Rural hospitals overall exhibit a positive effect in column 1.
Because rural hospitals send out relatively more transfers, this effect
is probably a reflection of the modification in the way we count
transfer cases in the recalibration methodology (see section II.C of
the preamble to this final rule). A study by the RAND Corporation for
HCFA, ``An Evaluation of Medicare Payments for Transfer Cases''
(Contract Number 500-92-0023), identified 10 DRGs that account for more
than half of all transfer cases. These DRGs experience, on average,
almost an 8 percent increase in their relative weights under the
recalibration, which contributes to the increases experienced by rural
hospitals and select urban hospitals. In comparison, the average
absolute change in the weights of all DRGs from FY 1994 to FY 1995 is
approximately 1 percent.
C. The Impact of Updating the Wage Data (Column 2)
Section 1886(d)(3)(E) of the Act requires that, beginning October
1, 1993, we annually update the wage data used to calculate the wage
index. In accordance with this requirement, the wage index for FY 1996
is based on data submitted for hospital cost reporting periods
beginning on or after October 1, 1991 and before October 1, 1992. As
with the previous column, the impact of the new data on hospital
payments is isolated by holding the other payment parameters constant
in the two simulations. That is, column 2 shows the percentage changes
in payments when going from our FY 1996 baseline--using the FY 1995
wage index (based on 1991 wage data) before geographic
reclassifications and incorporating the FY 1996 GROUPER--to a model
substituting the FY 1996 prereclassification wage index (based on FY
1992 data).
Section 1886(d)(3)(E) of the Act also requires that any updates or
adjustments to the wage index be made in a manner that ensures that
aggregate payments to hospitals are not affected by the change in the
wage index. To comply with the requirements that the DRG and wage index
changes must be implemented in a budget neutral manner, we compute a
budget neutrality adjustment factor to apply to the standardized
amounts. For the FY 1996 standardized amounts, this adjustment factor
is 0.999306. This factor is applied to the standardized amounts
reflected in this column to ensure that the overall effect of the wage
index changes are budget neutral.
The results indicate that the new wage data do not have a
significant overall impact on urban and rural hospitals. Virtually all
prospective payment system hospitals (94 percent) would experience a
change in their wage index of less than 5 percent. This column
demonstrates that hospitals with significant changes in their wage
indexes are not concentrated within any particular hospital group. For
FY 1996, some of the largest changes are evident among both urban and
rural hospitals grouped by census division. More census divisions
experience payment increases, of greater magnitude, for rural hospitals
than for urban hospitals. With the exception of urban Puerto Rico, all
payments change by less than 1.0 percent. Although a degree of
variation across census categories is evident in this column, our
review of the wage data (as described below) indicates that most of the
significant changes were attributable to improved reporting.
Besides urban Puerto Rico, the greatest increases are for rural
hospitals in the East South Central division, 0.8 percent, and urban
hospitals in West South Central, 0.7 percent. The greatest decreases
are 0.7 and 0.6 percent for urban hospitals in the West North Central
and Middle Atlantic regions, respectively, as well as 0.6 percent for
rural Puerto Rico. This effect contributes to the 0.4 percent decline
among major teaching hospitals--New York City's wage index falls by
nearly 2.0 percent. The Middle Atlantic region also experiences a
payment decrease of 0.5 percent for its rural hospitals. The Pacific
region experiences an increase in payments to both urban and rural
hospitals, with increases of 0.4 and 0.6 percent, respectively. The
most dramatic shift occurs in urban Puerto Rico, where payments
increase 2.7 percent. Of the six urban areas in Puerto Rico, five
experience large increases in wage while only one experiences a slight
decline. We note that while rural Puerto Rico had a decrease of 6.9
percent in the impact for the proposed rule, better reporting of data
has greatly improved the rural Puerto Rico wage index values so the
decrease is only 0.6 percent in the impact analysis for this final
rule.
The FY 1996 wage index represents the third annual update to the
wage data, and continues to include salaries, fringe benefits, home
office salaries, and certain contract labor salaries. In the past,
updates to the wage data have resulted in significant payment shifts
among hospitals. Since the wage index is now updated annually and there
are no changes to the types of costs included in the wage index data,
we expect these payment fluctuations will be minimized.
Based on the FY 1996 wage index calculation (after
reclassifications under sections 1886(d)(8)(B) and 1886(d)(10) of the
Act) compared to the FY 1995 wage index, there are more labor markets
that experience an increase of 5 percent or more in their wage index
values, and fewer labor markets that experience a significant decrease
of 5 percent or more. We reviewed the data for any area that
experiences a wage index change of 10 percent or more to determine the
reason for the fluctuation. When necessary, we contacted the
intermediaries to determine the validity of the data or to obtain an
explanation for the change. The following chart compares the shifts in
wage index values (after reclassifications) for labor markets for FY
1996 with those
[[Page 45930]]
experienced as a result of last year's wage index update.
------------------------------------------------------------------------
Number of
labor market
areas
Percentage change in area wage index values ---------------
FY FY
1996 1995
------------------------------------------------------------------------
Increase more than 10 percent........................... 10 5
Increase between 5 and 10 percent....................... 21 17
Decrease between 5 and 10 percent....................... 6 13
Decrease more than 10 percent........................... 0 10
------------------------------------------------------------------------
Under the FY 1996 wage index, 92.7 percent of rural prospective
payment hospitals and 95.0 percent of urban hospitals experience a
change in their wage index value of less than 5.0 percent.
Approximately 3.4 percent (2.1 percent of rural hospitals and 4.4
percent of urban hospitals) experience a change of between 5 and 10
percent, and 2.6 percent (5.3 percent of rural hospitals and 0.6
percent of urban hospitals) experience a change of more than 10
percent. The following chart shows the projected impact for urban and
rural hospitals.
------------------------------------------------------------------------
Percent of
hospitals (by
Percentage change in area wage index values urban/rural)
-----------------
Rural Urban
------------------------------------------------------------------------
Decrease more than 10 percent......................... 1.5 0.1
Decrease between 5 and 10 percent..................... 1.1 1.6
Change between -5 and +5 percent...................... 92.7 95.0
Increase between 5 and 10 percent..................... 1.0 2.8
Increase more than 10 percent......................... 3.8 0.5
------------------------------------------------------------------------
D. Transfer Changes (Column 3)
Column 3 of Table I shows the impacts of the change we are
implementing in transfer payment policy. This change revises our
methodology for payment for transfer cases under the prospective
payment system to more appropriately compensate transferring hospitals
for the higher costs they incur, on average, on the first day of a
hospital stay prior to transfer. Our previous transfer policy paid a
flat per diem amount for each day prior to transfer up to the full DRG
amount. The per diem was calculated by dividing the full DRG amount by
the geometric mean length of stay for that DRG. We are replacing this
flat per diem methodology with a graduated methodology that pays twice
the per diem amount for the first day, and the per diem amount for each
day beyond the first up to the full DRG amount.
The payment impacts shown in column 3 illustrate the effects of
this change, relative to the baseline simulation based on previous
policy (a flat per diem transfer payment methodology). In order to
simulate the effects of the changes, it was first necessary to identify
current transfer cases. Current transfers are identifiable by the
discharge destination code on the patient bill (see the RAND study for
a thorough discussion of identifying transfer cases on the MedPAR
file).
Next, to determine whether payment would be made under the per diem
methodology, we compared the actual length of stay prior to transfer to
the geometric mean length of stay for the DRG to which the case is
assigned. A full discharge or a transfer case that received the full
discharge payment would be counted as 1.0, while, under our current
transfer policy, a transfer case that stayed 2 days in a DRG with a
geometric mean length of stay of 5 days would count as 0.4 of a
discharge, and would be paid 40 percent of the full DRG amount. In this
manner, transfer cases are counted only to the extent that the
transferring hospital received payment for them. To simulate our change
to the per diem payment methodology, we added 1 day to the actual
length of stay for transfer cases, thereby replicating paying double
the per diem for the first stay and the flat per diem, up to the full
DRG amount, for subsequent days.
Finally, we calculated transfer-adjusted case-mix indexes for each
hospital. The adjusted case-mix indexes are calculated by summing the
transfer-adjusted DRG weights and dividing by the transfer-adjusted
number of cases. The transfer-adjusted DRG weights are calculated by
multiplying the DRG weight by the lesser of 1 or the fraction of the
length of stay for the case divided by the geometric mean length of
stay for the DRG. By adjusting the DRG weights, nontransfer cases and
transfer cases that have a length of stay at least as long as the
geometric mean length of stay will be represented by the full DRG
weight, while transfer cases with lengths of stay below the geometric
mean length of stay for the DRG will be represented by a lower number,
reflective of their payment.
The FY 1996 baseline model reflected in columns 1 and 2
incorporates transfer-adjusted discharges and case-mix indexes based on
current policies. That is, cases transferred prior to reaching the
geometric mean length of stay received payments based on the flat per
diem. In column 3, our model substitutes transfer-adjusted discharges
and case-mix indexes that reflect our policy change.
The first row in column 3 shows that the net effect of our change
is budget neutral compared to total payments under current transfer
policy. As specified in section 109 of the Social Security Act
Amendments of 1994 (Pub. L. 103-432), the Secretary is authorized to
make adjustments to the standardized amounts so that adjustments to the
payment policy for transfer cases do not affect aggregate payments. As
described in section II.A.4.a of the Addendum to this final rule, we
applied a budget neutrality factor of 0.997575 to the standardized
amounts to account for the higher payments going to transfer cases
based on our new payment policy.
The distributional effects of these changes are to increase
payments to rural hospitals by 0.3 percent and decrease urban
hospitals' payments by less than 0.1 percent (the overall change is 0.0
percent). Rural hospitals clearly benefit from the change in transfer
payment methodology. RAND found that rural hospitals as a whole
transfer 4.5 percent of their patients, compared to 1.7 percent in
large urban hospitals and 1.6 percent in other urban hospitals.
Therefore, one would expect rural hospitals to benefit from the change
in the transfer payment methodology.
The impact on small hospitals is also positive, consistent with
RAND's finding that hospitals with fewer than 50 beds transfer 6.1
percent of their cases, and hospitals with 50 to 99 beds transfer 4.9
percent of cases. Rural hospitals with fewer than 50 beds receive a 0.6
percent increase in per case payments, and rural hospitals with 50 to
99 beds receive a 0.4 percent increase. Urban hospitals with fewer than
100 beds experience a 0.3 percent rise in payments. Among rural
hospital groups, nonspecial status hospitals benefit by 0.6 percent and
hospitals receiving DSH payments that are not SCHs or RRCs receive
increases of 0.4 percent for hospitals with 100 or more beds and 0.7
percent for hospitals with fewer than 100 beds.
E. Impacts of MGCRB Reclassifications (Column 4)
By March 30 of each year, the MGCRB makes reclassification
decisions that will be effective for the next fiscal year, which begins
on October 1. The MGCRB may reclassify a hospital for the purposes of
using the other area's standardized amount, wage index value, or both.
To this point, all of the simulation models have assumed hospitals
are paid
[[Page 45931]]
on the basis of their geographic location (with the exception of
ongoing policies that provide that certain hospitals receive payments
on bases other than where they are geographically located, such as RRCs
and hospitals in rural counties that are deemed urban under section
1886(d)(8)(B) of the Act). The changes in column 4 reflect the per case
payment impact of moving from this baseline to a simulation
incorporating the MGCRB decisions for FY 1996. As noted above, these
decisions affect hospitals' standardized amount and wage index area
assignments. In addition, hospitals reclassified for the standardized
amount also qualify to be treated as urban for purposes of the DSH
adjustment.
The FY 1996 standardized payment amounts and wage index values
incorporate all of the MGCRB reclassification decisions that will be
effective for FY 1996. The wage index values also reflect any decisions
made by the HCFA Administrator through the appeals and review process
for MGCRB decisions and any reclassification withdrawal requests that
were received by the MGCRB. These Administrator decisions and
withdrawals may affect the number of reclassified hospitals relative to
those shown in the June 2, 1995 proposed rule. They may also determine
whether a redesignated hospital receives the wage index of the area to
which it is redesignated or a combined wage index that includes the
data for both the hospitals already in the area and the redesignated
hospitals.
The overall effect of geographic reclassification is required to be
budget neutral by section 1886(d)(8)(D) of the Act. Therefore, we
applied an adjustment of 0.994011 to ensure that the effects of
reclassification are budget neutral. (See section II.A.4.b. of the
Addendum to this final rule).
Rural hospitals benefit from geographic reclassification. Their
payments rise 2.3 percent, while payments to urban hospitals decline
0.4 percent. Large urban hospitals lose 0.5 percent because, as a
group, they have the smallest percentage of hospitals that are
reclassified, approximately 4 percent. Enough hospitals in other urban
areas are reclassified to limit the decline in payments stemming from
the budget neutrality offset to 0.1 percent. Among urban hospitals
grouped by bedsize, payments fall between 0.3 and 0.5 percent.
Rural hospitals that reclassify for purposes of the standardized
amount and receive DSH payments experience a significant increase in
payments as a result of receiving higher DSH payments as urban
hospitals. Rural hospitals reclassifying to large urban areas and also
receiving DSH receive an 11.1 percent increase in payments. The
difference between the large urban standardized amount and the other
urban amount is 1.6 percent, and the remainder is due to DSH payments
and to any wage index increase that hospitals reclassified for both the
wage index and the standardized amount receive.
Rural hospitals reclassifying to other urban areas for purposes of
the standardized amount receive an 8.6 percent increase in payments.
Since there are no longer separate rural and other urban standardized
amounts, this large increase is attributable to the higher DSH payments
these 69 hospitals receive as a result of being classified as urban (as
well as any increase in their wage index for those hospitals
reclassified for both the wage index and standardized amount). Under
our revised rules for MGCRB reclassification, these hospitals will no
longer be eligible to reclassify solely to receive higher DSH payments
effective with reclassifications for FY 1997.
Among rural hospitals designated as RRCs, 57 hospitals are
reclassified for the wage index only and experience a 4.9 percent
increase in payments overall. This positive impact on RRCs also appears
in the category of rural hospitals with 200 or more beds, which have a
5.4 percent increase in payments.
Rural hospitals reclassified for FY 1995 and FY 1996 experience an
8.0 percent increase in payments, the greatest of any group in the
category. This may be due to the fact that these hospitals have the
most to gain from reclassification and have been reclassified for a
period of years. Rural hospitals reclassified for FY 1996 alone
experience a 5.6 percent increase in payments. Urban hospitals
reclassified for FY 1995 but not FY 1996 experience a 1.8 percent
decline in payments overall. This appears to be due to the combined
impacts of the budget neutrality adjustment and a number of hospitals
in this category that experience a 6 percent drop in their wage index
after reclassification. Urban hospitals reclassified for FY 1996 but
not for FY 1995 experience a 2.1 percent increase in payments.
The FY 1996 reclassification section of Table I shows the changes
in payments per case for all FY 1996 reclassified and nonreclassified
hospitals in urban and rural locations for each of the three
reclassification categories (standardized amount only, wage index only,
or both). It illustrates that the large impact for reclassified rural
hospitals is due to reclassifications for both the standardized amount
and the wage index. These hospitals receive a 13.1 percent increase. In
addition, rural hospitals reclassified for the wage index only receive
a 7.9 percent payment increase. The overall impact on reclassified
hospitals is to increase their payments per case by an average of 4.7
percent for FY 1996.
The reclassification of hospitals primarily affects payment to
nonreclassified hospitals through changes in the wage index and the
geographic reclassification budget neutrality adjustment required by
section 1886(d)(8)(D) of the Act. Among hospitals that are not
reclassified, the overall impact of hospital reclassifications is an
average decrease in payments per case of about 0.6 percent,
approximately the geographic reclassification budget neutrality factor.
Rural nonreclassified hospitals decrease slightly less, experiencing a
0.4 percent decrease. This occurs because the wage index values in some
rural areas increase after reclassified hospitals are excluded from the
calculation of those values.
The number of reclassifications for the standardized amount, or for
both the standardized amount and the wage index, has declined from 496
in FY 1995 to 344 in FY 1996. This is not surprising because the rural
standardized amount is now equal to the standardized amount for other
urban areas. Some rural hospitals are reclassifying for purposes of the
large urban amount, thereby receiving a payment rate even higher than
they would receive from the other national amount. Rural hospitals also
may be reclassifying for the standardized amount even though they are
only eligible to reclassify to an other urban area in order to either
meet the lower eligibility requirements for DSH payments, or to receive
higher DSH payments. The payment impact upon hospitals reclassified for
the standardized amount only, however, is significantly lower than it
is for hospitals reclassifying for either the wage index alone, or for
both the wage index and the standardized amount.
F. Outlier Changes (Column 5)
Medicare provides extra payment in addition to the regular DRG
payment amount for extremely costly or extraordinarily lengthy cases
(cost outliers and day outliers, respectively). Section
1886(d)(5)(A)(v) of the Act requires the Secretary to phase out payment
for day outliers in 25 percent increments beginning in FY 1995 from FY
1994 day outlier levels. Day outliers in FY 1996 will account for
[[Page 45932]]
approximately 16 percent of total outlier payments (50 percent of 1994
levels). This reduction in day outlier payments will be offset by an
increase in payments for cost outliers. For FY 1996, we are setting the
day outlier threshold equal to the geometric mean length of stay for
each DRG, plus the lesser of 23 days or 3.0 standard deviations. The
marginal cost factor for day outliers will be 44 percent.
The statute also authorizes the Secretary to set a fixed loss per
case threshold for cost outliers. For FY 1996, a case will receive cost
outlier payments if its costs exceed the DRG amount plus $15,150. We
are also maintaining the marginal cost factor for cost outliers at 80
percent.
The payment impacts of these changes are minimal. The largest
impacts appear to be related to geographic location in terms of census
divisions. Urban hospitals in the Middle Atlantic census division have
payment reductions of 0.8 percent per case. Rural Middle Atlantic
hospitals have a 0.3 percent decline. In New England, urban hospitals
experience decreases of 0.2 percent. Since the changes to outlier
policy result in a shift in payments from cases paid as day outliers to
cases paid as cost outliers, this indicates that these areas have
higher percentages of day outliers. This is consistent with our
previous analysis indicating above average impacts related to day
outlier policy changes in the northeastern portion of the country. (See
the June 4, 1992 proposed rule (57 FR 23824).)
The largest negative impact occurs among hospitals for which we
could not determine Medicare utilization rates. This group experiences
a 1.2 percent fall in payments per case. The bulk of the decline is
attributable to a group of New York hospitals included in this category
that experience significant drops in outlier payments.
G. All Changes (Column 6)
Column 6 compares our estimate of payments per case for FY 1996 to
our estimate of payments per case in FY 1995. It includes the 1.5
percent update to the standardized amounts and the hospital-specific
rates for SCHs and EACHs, and the 1.1 percent lower than estimated
outlier payments during FY 1995, as described in the introduction and
the Addendum.
A single geographic reclassification budget neutrality factor of
0.994011 was applied to the FY 1996 standardized amounts, compared to
the FY 1995 factor of 0.994055. The budget neutrality adjustment factor
for the updated wage index and the DRG recalibration is 0.999306,
compared to the FY 1995 factor of 0.998050. Although the net effect of
these changes is small, they are reflected in the payment differences
shown in this column.
There may also be interactive effects among the various factors
comprising the payment system that we are not able to isolate. For
these reasons, the values in column 6 may not equal the sum of the
previous columns plus the other impacts that we are able to identify.
We also note that column 6 includes the impacts of FY 1995
geographic reclassifications compared to the payment impacts of FY 1996
reclassifications. Therefore, the percent changes due to FY 1996
reclassifications shown in column 4 may be offset by the effects of
reclassification on hospitals' FY 1995 payments. For example, the
impact of MGCRB reclassifications on rural hospitals' FY 1995 payments
was a 2.2 percent increase, compared to a 2.3 percent increase for FY
1996. Therefore, the net increase for rural hospitals in FY 1996
payments due to reclassification is 0.1 percent.
The overall payment increase from FY 1995 to FY 1996 for all
hospitals is a 2.6 percent increase. This reflects the 0.0 percent net
change in total payments due to the changes for FY 1996 shown in
columns 1 through 5, the 1.5 percent update for FY 1996, and the 1.1
percent higher outlier payments in FY 1996 compared to FY 1995, as
discussed above.
Hospitals in rural areas experience the largest payment increase, a
3.1 percent rise in payments per case over FY 1995. The increase in
estimated outlier payments over FY 1995 for rural hospitals is 0.7
percent, below the 1.1 percent difference for all hospitals. As noted
above, the net increase for rural hospitals in FY 1996 due to
geographic reclassification is 0.1 percent. They also benefit from DRG
recalibration, the new wage index, and the change in the transfer
payment policy.
Urban hospitals' overall payments increase 2.5 percent. Hospitals
in large and other urban areas experience 2.2 percent and 3.0 percent
increases, respectively. Both large and other urban hospitals
experience 1.1 percent increases in payments for FY 1996 due to the
larger outlier payout, plus the 1.5 percent update. In addition, large
urban hospitals' 0.5 percent decline due to reclassification is
identical to the FY 1995 impact of reclassification, thus the net
impact is 0.0. The FY 1995 reclassification impact on other urban
hospitals was also 0.0 percent, compared to the 0.1 percent decline in
column 4 of Table I, for a net decrease of 0.1 percent from FY 1995 to
FY 1996.
Among urban bed size groups, column 6 shows changes in payments are
higher for the smallest urban hospitals compared to larger urban
hospitals. The relatively smaller increases for the larger urban
hospitals appears to be due to the negative impacts of the new wage
data, as shown in column 2, and to the new transfer policy (column 4).
Among rural bed size groups the impacts are less varied, ranging from
2.6 percent to 3.4 percent.
Two census divisions are well below the average payment increase:
urban Middle Atlantic and urban West North Central (both increase less
than 2.0 percent). The reason for the relatively small increase for
urban hospitals in the Middle Atlantic is that they have sizeable
negative impacts due to the new wage data and the phase-out of day
outliers. Urban hospitals in the West North Central division also
experience a negative impact from the new wage data.
Conversely, rural New England hospitals experience a 3.8 percent
increase, and urban West South Central hospitals see a 3.7 percent
payment increase. By far the largest increase among all of the census
divisions is in urban Puerto Rico, with a 5.5 percent increase. This
large increase is primarily attributable to the effects of the new wage
data, as discussed above.
The only hospital groups with negative payment impacts from FY 1995
to FY 1996 are hospitals that were reclassified for FY 1995 and are not
reclassified for FY 1996. Overall, these hospitals lose 0.7 percent,
with 112 urban hospitals in this category losing 0.4 percent and 172
rural hospitals losing 1.5 percent. On the other hand, hospitals
reclassified for FY 1996 that were not reclassified for FY 1995 would
experience the greatest payment increase: 7.7 percent for 31 urban
hospitals in this category and 9.0 percent for 116 rural hospitals.
Reclassification appears to be a significant factor influencing the
payment increases for a number of rural hospital groups with above
average overall payment increases in column 6. For example, among
hospital groups identified in the discussion of the impacts of MGCRB
reclassifications for FY 1996 (column 4), almost all have overall
increases of 3.0 or greater. This outcome highlights the redistributive
effects of reclassification decisions upon hospital payments. This
impact is illustrated even more clearly when one examines the rows
categorizing hospitals by their reclassification status for FY 1996.
All nonreclassified hospitals have an average payment increase of 2.4
percent. The average
[[Page 45933]]
payment increase for all reclassified hospitals is 4.0 percent.
Major teaching hospitals with 100 or more residents have a payment
increase of only 1.8 percent. This is attributable to the combined
negative impacts of the new wage data, reclassification, and the
continued phase-out of day outliers. As discussed above, teaching
hospitals located in New York City account for much of this impact.
(They also account for much of the below average increase for hospitals
for which we do not have Medicare utilization data (1.7 percent
increase), along with several Puerto Rico hospitals.)
Finally, among hospitals that are SCH/EACHs, and those that are
both SCH/EACH and RRCs, the payment increase is 2.2 percent. The
primary reason for this below average increase is the minimal impact
upon these hospitals of the higher FY 1996 outlier payments. Because
these hospital groups receive their hospital-specific rate if it
exceeds the applicable Federal amount (including outliers), there is
less of an impact due to changes in outlier payment levels, which are
not applied to the hospital-specific rate.
Table II.--Impact Analysis of Changes for FY 1996 Operating Prospective
Payment System
[PAYMENTS PER CASE]
Average FY Average FY
Number of 1995 1996 All
hospitals payment payment changes
per case per case
(1) (2) \1\ (3) \1\ (4)
------------------------------------------------------------------------
(BY GEOGRAPHIC LOCATION)
------------------------------------------------------------------------
ALL HOSPITALS........... 5,207 6,274 6,436 2.6
URBAN HOSPITALS......... 2,942 6,772 6,940 2.5
LARGE URBAN AREAS....... 1,647 7,284 7,443 2.2
OTHER URBAN AREAS....... 1,295 6,073 6,255 3.0
RURAL AREAS............. 2,265 4,259 4,391 3.1
BED SIZE (URBAN):
0-99 BEDS........... 755 4,596 4,727 2.8
100-199 BEDS........ 925 5,733 5,903 3.0
200-299 BEDS........ 595 6,266 6,432 2.7
300-499 BEDS........ 489 7,198 7,369 2.4
500 OR MORE BEDS.... 178 8,794 8,971 2.0
BED SIZE (RURAL):
0-49 BEDS........... 1,179 3,533 3,643 3.1
50-99 BEDS.......... 665 3,965 4,097 3.4
100-149 BEDS........ 227 4,449 4,562 2.6
150-199 BEDS........ 109 4,508 4,657 3.3
200 OR MORE BEDS.... 85 5,235 5,404 3.2
URBAN BY CENSUS DIV.:
NEW ENGLAND......... 164 7,205 7,359 2.1
MIDDLE ATLANTIC..... 441 7,464 7,598 1.8
SOUTH ATLANTIC...... 435 6,448 6,617 2.6
EAST NORTH CENTRAL.. 490 6,500 6,668 2.6
EAST SOUTH CENTRAL.. 164 5,920 6,083 2.7
WEST NORTH CENTRAL.. 196 6,432 6,557 1.9
WEST SOUTH CENTRAL.. 387 6,260 6,491 3.7
MOUNTAIN............ 132 6,619 6,767 2.2
PACIFIC............. 485 7,793 8,009 2.8
PUERTO RICO......... 48 2,473 2,609 5.5
RURAL BY CENSUS DIV.:
NEW ENGLAND......... 53 5,142 5,334 3.8
MIDDLE ATLANTIC..... 84 4,735 4,875 3.0
SOUTH ATLANTIC...... 300 4,396 4,530 3.0
EAST NORTH CENTRAL.. 305 4,240 4,394 3.6
EAST SOUTH CENTRAL.. 278 3,816 3,950 3.5
WEST NORTH CENTRAL.. 529 4,018 4,132 2.9
WEST SOUTH CENTRAL.. 354 3,846 3,947 2.6
MOUNTAIN............ 214 4,797 4,904 2.2
PACIFIC............. 143 5,314 5,494 3.4
PUERTO RICO......... 5 1,961 2,006 2.3
------------------------------------------------------------------------
(BY PAYMENT CATEGORIES)
------------------------------------------------------------------------
URBAN HOSPITALS......... 3,152 6,682 6,852 2.5
LARGE URBAN AREAS....... 1,835 7,123 7,287 2.3
OTHER URBAN AREAS....... 1,317 5,983 6,163 3.0
RURAL AREAS............. 2,055 4,216 4,333 2.8
TEACHING STATUS:
NON-TEACHING........ 4,135 5,165 5,318 3.0
FEWER THAN 100
RESIDENTS.......... 841 6,680 6,848 2.5
100 OR MORE
RESIDENTS.......... 231 10,346 10,531 1.8
DISPROPORTIONATE SHARE
HOSPITALS (DSH):
NON-DSH............. 3,234 5,475 5,628 2.8
[[Page 45934]]
URBAN DSH:
100 BEDS OR MORE 1,370 7,414 7,587 2.3
FEWER THAN 100
BEDS........... 120 4,689 4,844 3.3
RECLASS. RURAL DSH:
LARGE URBAN AND
DSH............ 22 4,764 5,047 5.9
DSH ONLY........ 69 4,474 4,696 5.0
RURAL DSH:
SOLE COMMUNITY
(SCH).......... 136 4,747 4,848 2.1
REFERRAL CENTERS
(RRC).......... 29 5,319 5,474 2.9
OTHER RURAL DSH
HOSP.:
100 BEDS OR MORE 82 3,933 3,992 1.5
FEWER THAN 100
BEDS........... 145 3,298 3,417 3.6
URBAN TEACHING AND DSH:
BOTH TEACHING AND
DSH................ 667 8,386 8,564 2.1
TEACHING AND NO DSH. 356 6,831 6,998 2.5
NO TEACHING AND DSH. 914 5,841 6,014 3.0
NO TEACHING AND NO
DSH................ 1,215 5,275 5,434 3.0
RURAL HOSPITAL TYPES:
NONSPECIAL STATUS
HOSPITALS.......... 1,302 3,616 3,722 2.9
RRC................. 91 4,869 5,038 3.5
SCH/EACH............ 623 4,758 4,864 2.2
SCH/EACH AND RRC.... 39 5,547 5,668 2.2
TYPE OF OWNERSHIP:
VOLUNTARY........... 3,149 6,442 6,602 2.5
PROPRIETARY......... 718 5,688 5,852 2.9
GOVERNMENT.......... 1,340 5,837 6,006 2.9
MEDICARE UTILIZATION AS
A PERCENT OF INPATIENT
DAYS:
0-25................ 267 8,264 8,440 2.1
25-50............... 1,356 7,601 7,779 2.3
50-65............... 2,217 5,739 5,899 2.8
OVER 65............. 1,245 4,930 5,065 2.7
UNKNOWN............. 122 7,744 7,877 1.7
------------------------------------------------------------------------
HOSPITALS RECLASSIFIED BY THE MEDICARE GEOGRAPHIC REVIEW BOARD
------------------------------------------------------------------------
RECLASSIFICATION STATUS
DURING FY95 AND FY96:
RECLASSIFIED DURING
BOTH FY95 AND FY96. 453 5,674 5,840 2.9
URBAN........... 163 6,593 6,789 3.0
RURAL........... 290 4,738 4,874 2.9
RECLASSIFIED DURING
FY96 ONLY.......... 147 5,222 5,661 8.4
URBAN........... 31 6,687 7,201 7.7
RURAL........... 116 4,430 4,828 9.0
RECLASSIFIED DURING
FY95 ONLY.......... 284 5,964 5,924 -0.7
URBAN........... 112 6,956 6,931 -0.4
RURAL........... 172 4,239 4,175 -1.5
FY 96 RECLASSIFICATIONS:
ALL RECLASSIFIED
HOSP............... 602 5,580 5,803 4.0
STAND. AMT. ONLY 210 5,060 5,256 3.9
WAGE INDEX ONLY. 258 5,707 5,952 4.3
BOTH............ 134 6,042 6,269 3.8
NONRECLASS...... 4,578 6,381 6,534 2.4
ALL URBAN RECLASS... 195 6,605 6,851 3.7
STAND. AMT. ONLY 68 5,833 6,050 3.7
WAGE INDEX ONLY. 35 8,463 8,871 4.8
BOTH............ 92 6,383 6,578 3.0
NONRECLASS...... 2,747 6,785 6,947 2.4
ALL RURAL RECLASS... 407 4,659 4,862 4.4
STAND. AMT. ONLY 142 4,240 4,415 4.1
WAGE INDEX ONLY. 223 4,801 4,992 4.0
BOTH............ 42 5,050 5,370 6.3
NONRECLASS...... 1,831 4,052 4,149 2.4
OTHER RECLASSIFIED
HOSPITALS (SECTION
1886(d)(8)(B))......... 27 4,391 4,535 3.3
\1\ These payment amounts per case do not reflect any estimates of
annual case mix increase.
[[Page 45935]]
Table II presents the projected average payments per case under the
changes for FY 1996 for urban and rural hospitals and for the different
categories of hospitals shown in Table I. It compares the projected
payments per case for FY 1996 with the average estimated per case
payments for FY 1995. Thus, this table presents, in terms of the
average dollar amounts paid per discharge, the combined effects of the
changes presented in Table I. The percentage changes shown in the last
column of Table II equal the percentage changes in average payments
from column 6 of Table I.
VII. Impact of Changes in the Capital Prospective Payment System
A. General Considerations
We now have data that were unavailable for analyzing the impact
changes in the capital prospective payment system for previous fiscal
years. Specifically, we have cost report data for the second year of
the capital prospective payment system (cost reports beginning in FY
1993) available through the June 1995 update of the Hospital Cost
Report Information System (HCRIS). We also have information on the
projected aggregate amount of obligated capital approved by the fiscal
intermediaries. However, our impact analysis of payment changes for
capital-related costs is still limited by the lack of hospital-specific
data on several items. These are the hospital's projected new capital
costs for each year, its projected old capital costs for each year, and
the actual amounts of obligated capital that will be put in use for
patient care and recognized as Medicare old capital costs in each year.
The lack of such information affects our impact analysis in the
following ways:
Major investment in hospital capital assets (for example
in building and major fixed equipment) occurs at irregular intervals.
As a result, there can be significant variation in the growth rates of
Medicare capital-related costs per case among hospitals. We do not have
the necessary hospital-specific budget data to project the hospital
capital growth rate for an individual hospital.
Moreover, our policy of recognizing certain obligated
capital as old capital makes it difficult to project future capital-
related costs for individual hospitals. Under Sec. 412.302(c), a
hospital is required to notify its intermediary that it has obligated
capital by the later of October 1, 1992, or 90 days after the beginning
of the hospital's first cost reporting period under the capital
prospective payment system. The intermediary must then notify the
hospital of its determination whether the criteria for recognition of
obligated capital have been met by the later of the end of the
hospital's first cost reporting period subject to the capital
prospective payment system or 9 months after the receipt of the
hospital's notification. The amount that is recognized as old capital
is limited to the lesser of the actual allowable costs when the asset
is put in use for patient care or the estimated costs of the capital
expenditure at the time it was obligated. We have substantial
information regarding intermediary determinations of projected
aggregate obligated capital amounts. However, we still do not know when
these projects will actually be put into use for patient care, the
amount that will be recognized as obligated capital when the project is
put into use, or the Medicare share of the recognized costs. Therefore,
we do not know actual obligated capital commitments to be used in the
FY 1996 capital cost projections. We discuss in Appendix B the
assumptions and computations we employ to generate the amount of
obligated capital commitments for use in the FY 1996 capital cost
projections.
In Table III of this appendix, we present the redistributive
effects that are expected to occur between ``hold-harmless'' hospitals
and ``fully prospective'' hospitals in FY 1996. In addition, we have
integrated sufficient hospital-specific information into our actuarial
model to project the impact of FY 1996 capital payment policies by the
standard prospective payment system hospital groupings. We caution that
while we now have actual information on the effects of the transition
payment methodology and interim payments under the capital prospective
payment system and cost report data for most hospitals, we need to
randomly generate numbers for the change in old capital costs, new
capital costs for each year, and obligated amounts that will be put in
use for patient care services and recognized as old capital each year.
This means that we continue to be unable to predict accurately an
individual hospital's FY 1996 capital costs; however, with the more
recent data on the experience to date under the capital prospective
payment system, there is adequate information to estimate the aggregate
impact on most hospital groupings.
We present the transition payment methodology by hospital grouping
in Table IV. In Table V we present the results of the cross-sectional
analysis using the results of our actuarial model. This table presents
the aggregate impact of the FY 1996 payment policies.
B. Projected Impact Based on the FY 1996 Actuarial Model
1. Assumptions
In this impact analysis, we model dynamically the impact of the
capital prospective payment system from FY 1995 to FY 1996 using a
capital acquisition model. The FY 1996 model, described in Appendix B
of this final rule, integrates actual data from individual hospitals
with randomly generated capital cost amounts. We have capital cost data
from cost reports beginning in FY 1989 through FY 1993 received through
the June 1995 HCRIS update, interim payment data for hospitals already
receiving capital prospective payments through PRICER, and data
reported by the intermediaries that include the hospital-specific rate
determinations that have been made through July 1, 1995 in the
Provider-Specific file. We used this data to determine the FY 1996
capital rates. However, we do not have individual hospital data on old
capital changes, new capital formation, and actual obligated capital
costs. We have data on costs for capital in use in FY 1993, and we age
that capital by a formula described in Appendix B. We therefore need to
randomly generate only new capital acquisitions for any year after FY
1993. All Federal rate payment parameters are assigned to the
applicable hospital.
For purposes of this impact analysis, the FY 1996 actuarial model
includes the following assumptions:
Medicare inpatient capital costs per discharge will
increase at the following rates during these periods:
Average Percentage Increase in Capital
------------------------------------------------------------------------
Costs per
Fiscal year discharge
------------------------------------------------------------------------
1995....................................................... 4.91
1996....................................................... 5.03
------------------------------------------------------------------------
The Medicare case-mix index will increase by 1.4 percent
in FY 1995 and 0.8 percent in FY 1996.
The Federal capital rate as well as the hospital-specific
rate will be updated by an analytical framework that considers changes
in the prices associated with capital-related costs, and adjustments to
account for forecast error, changes in the case-mix index, allowable
changes in intensity, and other factors. The proposed FY 1996 update
factor was 1.50 percent. In this final rule, the FY 1996 update factor
is 1.20 percent (see section V.A of the preamble to this final rule).
[[Page 45936]]
2. Results
We have used the actuarial model to estimate the change in payment
for capital-related costs from FY 1995 to FY 1996. Table III shows the
effect of the capital prospective payment system on low capital cost
hospitals and high capital cost hospitals. We consider a hospital to be
a low capital cost hospital if, based on a comparison of its initial
hospital-specific rate and the applicable Federal rate, it will be paid
under the fully prospective payment methodology. A high capital cost
hospital is a hospital that, based on its initial hospital-specific
rate, will be paid under the hold-harmless payment methodology. Based
on our actuarial model, the breakdown of hospitals is as follows:
Capital Transition Payment Methodology
------------------------------------------------------------------------
FY 1996 FY 1996
Percent of FY 1996 percent of percent of
Type of hospital hospitals percent of capital capital
discharges costs payments
------------------------------------------------------------------------
Low Cost Hospital... 65 62 51 55
High Cost Hospital.. 35 38 49 45
------------------------------------------------------------------------
A low capital cost hospital may request to have its hospital-
specific rate redetermined based on old capital costs in the current
year, through the later of the hospital's cost reporting period
beginning in FY 1994 or the first cost reporting period beginning after
obligated capital comes into use (within the limits established in
Sec. 412.302(e) for putting obligated capital in use for patient care).
If the redetermined hospital-specific rate is greater than the adjusted
Federal rate, these hospitals will be paid under the hold-harmless
payment methodology. Regardless of whether the hospital became a hold-
harmless payment hospital as a result of a redetermination, we have
continued to show these hospitals as low capital cost hospitals in
Table III.
Assuming no behavioral changes in capital expenditures, Table III
displays the percentage change in payments from FY 1995 to FY 1996
using the above described actuarial model.
Table III.--Impact of Final Rule Changes for FY 1996 on Payments per Discharge
[FY 1995 Payments Per Discharge]
----------------------------------------------------------------------------------------------------------------
Adjusted Average Hospital Hold
Number of Discharges Federal Federal specific harmless Exceptions Total
hospitals payment percent payment payment payment payment
----------------------------------------------------------------------------------------------------------------
Low Cost
Hospitals...... 3,400 6,602,508 $259.45 43.00 $195.17 $45.18 $14.62 $514.42
Fully
Prospective 1,703 3,344,802 240.13 40.00 230.91 .......... 4.65 475.69
Rebase--Full
y Prosp.... 1,352 2,385,894 239.62 40.00 216.38 .......... 32.61 488.61
Rebase--100%
Fed Rate... 154 427,893 655.26 100.00 .......... .......... 2.19 657.45
Rebase--Hold
Harmless... 191 443,918 130.12 21.69 .......... 671.91 5.02 807.05
High Cost
Hospitals...... 1,797 4,116,329 357.04 56.85 .......... 385.28 3.41 745.72
100% Federal
Rate....... 684 1,735,792 650.39 100.00 .......... .......... 0.35 650.74
Hold
Harmless... 1,113 2,380,537 143.14 23.40 .......... 666.20 5.63 814.97
-----------------------------------------------------------------------------------------------
Total
Hospitals 5,197 10,718,837 296.93 48.45 120.22 175.78 10.31 603.25
----------------------------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------------------------------------------------------------
Adjusted Average Hospital Hold
Number of Discharges Federal Federal specific harmless Exceptions Total Percent
hospitals payment percent payment payment payment payment change
--------------------------------------------------------------------------------------------------------------------------------------------------------
Low Cost Hospitals.......................... 3,400 6,602,508 $401.00 53.74 $198.52 $33.50 $12.90 $645.93 25.56
Fully Prospective....................... 1,703 3,344,802 371.28 50.00 234.90 .......... 5.11 611.29 28.50
Rebase--Fully Prosp..................... 1,352 2,385,894 370.33 50.00 220.06 .......... 26.10 616.49 26.17
Rebase--100% Fed Rate................... 214 594,762 791.33 100.00 .......... .......... 7.35 799.08 21.54
Rebase--Hold Harmless................... 131 277,050 185.05 24.97 .......... 798.45 5.31 988.81 22.52
High Cost Hospitals......................... 1,797 4,116,329 577.66 74.25 .......... 277.19 2.86 857.71 15.02
100% Federal Rate........................... 1,027 2,631,255 783.04 100.00 .......... .......... 0.48 783.52 20.40
Hold Harmless............................... 770 1,485,074 213.78 27.80 .......... 768.33 7.07 989.18 21.38
-----------------------------------------------------------------------------------------------------------
Total Hospitals....................... 5,197 10,718,837 468.84 61.82 122.28 127.09 9.05 727.26 20.56
--------------------------------------------------------------------------------------------------------------------------------------------------------
Under section 1886(g)(1)(A) of the Act, estimated aggregate
payments under the capital prospective payment system for FY 1992
through 1995 respectively, were to equal 90 percent of estimated
payments that would have been payable on a reasonable cost basis in
each year. With the expiration of the capital budget neutrality
provision, we
[[Page 45937]]
estimate that there will be an aggregate 20.56 percent increase in FY
1996 Medicare capital payments over the FY 1995 payments.
We project that low capital cost hospitals will experience an
average increase in payments per case of 25.56 percent, and high
capital cost hospitals will experience an average increase of 15.02
percent.
For hospitals paid under the fully prospective payment methodology,
the Federal rate payment percentage will increase from 40 percent to 50
percent and the hospital-specific rate payment percentage will decrease
from 60 to 50 percent in FY 1996.
The Federal rate payment percentage for a hospital paid under the
hold-harmless payment methodology is based on the hospital's ratio of
new capital costs to total capital costs. The average Federal rate
payment percentage for hospitals receiving a hold-harmless payment for
old capital will increase from 23.40 percent to 27.80 percent.
Despite the reduction in the hospital-specific rate blend
percentage from 60 percent in FY 1995 to 50 percent in FY 1996, we
expect that the average hospital-specific rate payment per discharge
will increase from $120.22 in FY 1995 to $122.28 in FY 1996. This is
due to the large increase (21.10 percent) in the FY 1996 hospital-
specific rate compared to FY 1995.
We proposed no changes in our exceptions policies for FY 1996. As a
result, the minimum payment levels will be:
90 percent for sole community hospitals;
80 percent for urban hospitals with 100 or beds and a
disproportionate share patient percentage of 20.2 percent or more; or,
70 percent for all other hospitals.
We estimate that exceptions payments will decrease from 1.71
percent of total capital payments in FY 1995 to 1.24 percent of
payments in FY 1996. This is due to the large increase in the rates--as
rate-based payments increase, exceptions payments decrease. The
projected distribution of the payments is shown in the table below:
Estimated FY 1996 Exceptions Payments
------------------------------------------------------------------------
Percent of
Type of hospital No. of exceptions
hospitals payments
------------------------------------------------------------------------
Low Capital Cost.............................. 217 88
High Capital Cost............................. 118 12
Total................................... 335 100
------------------------------------------------------------------------
C. Cross-Sectional Comparison of Capital Prospective Payment
Methodologies
Table IV presents a cross-sectional summary of hospital groupings
by capital prospective payment methodology. This distribution is
generated by our actuarial model.
Table IV.--Distribution by Method of Payment (Hold-Harmless/Fully Prospective) of Hospitals Receiving Capital
Payments
----------------------------------------------------------------------------------------------------------------
(2)Hold-harmless
(1) Total -------------------------- (3)Percentage
No. of Percentage Percentage paid fully
hospitals paid hold- paid fully prospective
harmless(A) federal (B) rate
----------------------------------------------------------------------------------------------------------------
By Geographic Location:
All hospitals......................................... 5,197 17.3 23.9 58.8
Large urban areas (populations over 1 million)........ 1,640 20.2 31.3 48.5
Other urban areas (populations of 1 million or fewer). 1,294 21.8 27.9 50.3
Rural areas........................................... 2,263 12.7 16.2 71.1
Urban hospitals....................................... 2,934 20.9 29.8 49.3
0-99 beds......................................... 749 24.8 21.9 53.3
100-199 beds...................................... 923 25.0 31.4 43.6
200-299 beds...................................... 595 17.0 35.5 47.6
300-499 beds...................................... 489 14.7 32.3 53.0
500 or more beds.................................. 178 13.5 28.7 57.9
Rural hospitals....................................... 2,263 12.7 16.2 71.1
0-49 beds......................................... 1,177 10.0 11.1 78.8
50-99 beds........................................ 665 14.4 18.8 66.8
100-149 beds...................................... 227 17.2 29.1 53.7
150-199 beds...................................... 109 17.4 20.2 62.4
200 or more beds.................................. 85 17.6 27.1 55.3
By Region:
Urban by Region....................................... 2,934 20.9 29.8 49.3
New England....................................... 163 9.2 23.3 67.5
Middle Atlantic................................... 441 12.7 28.3 59.0
South Atlantic.................................... 433 25.4 34.6 40.0
East North Central................................ 490 15.3 26.3 58.4
East South Central................................ 164 29.9 28.7 41.5
West North Central................................ 196 19.9 27.6 52.6
West South Central................................ 387 37.2 37.2 25.6
Mountain.......................................... 128 20.3 38.3 41.4
Pacific........................................... 484 18.6 27.3 54.1
Puerto Rico....................................... 48 20.8 12.5 66.7
Rural by Region....................................... 2,263 12.7 16.2 71.1
New England....................................... 53 11.3 11.3 77.4
Middle Atlantic................................... 84 8.3 16.7 75.0
South Atlantic.................................... 300 15.3 22.3 62.3
East North Central................................ 305 11.5 10.2 78.4
East South Central................................ 278 14.7 25.9 59.4
West North Central................................ 529 8.7 12.7 78.6
[[Page 45938]]
West South Central................................ 352 14.2 18.8 67.0
Mountain.......................................... 214 14.0 13.1 72.9
Pacific........................................... 143 18.2 10.5 71.3
By Payment Classification:
All hospitals......................................... 5,197 17.3 23.9 58.8
Large urban areas (populations over 1 million)........ 1,828 19.7 31.0 49.3
Other urban areas (populations of 1 million or fewer). 1,316 22.0 27.4 50.7
Rural areas........................................... 2,053 12.2 15.3 72.4
Teaching Status:......................................
Non-teaching...................................... 4,125 17.8 23.0 59.2
Fewer than 100 Residents.......................... 841 17.0 27.7 55.3
100 or more Residents............................. 231 10.4 26.0 63.6
Disproportionate share hospitals (DSH):
Non-DSH........................................... 3,225 17.1 20.1 62.8
Urban DSH:
100 or more beds.............................. 1,436 18.9 33.1 47.9
Less than 100 beds............................ 144 20.8 25.7 53.5
Rural DSH:
Sole Community (SCH/EACH)..................... 136 13.2 14.7 72.1
Referral Center (RRC/EACH).................... 29 17.2 17.2 65.5
Other Rural:
100 or more beds.......................... 82 14.6 32.9 52.4
Less than 100 beds........................ 145 8.3 20.0 71.7
Urban teaching and DSH:
Both teaching and DSH............................. 667 13.5 30.3 56.2
Teaching and no DSH............................... 356 18.3 23.9 57.9
No teaching and DSH............................... 913 23.2 34.1 42.7
No teaching and no DSH............................ 1,208 23.4 27.2 49.4
Rural Hospital Types:
Non special status hospitals...................... 1,300 8.8 16.8 74.5
RRC/EACH.......................................... 91 20.9 23.1 56.0
SCH/EACH.......................................... 623 17.7 11.4 70.9
SCH, RRC and EACH................................. 39 20.5 12.8 66.7
Type of Ownership:
Voluntary......................................... 3,139 17.2 24.1 58.8
Proprietary....................................... 718 30.4 39.3 30.4
Government........................................ 1,340 10.7 15.2 74.0
Medicare Utilization as a Percent of Inpatient Days:
0-25.............................................. 267 24.0 21.0 55.1
25-50............................................. 1,356 19.5 28.5 52.0
50-65............................................. 2,217 16.2 24.3 59.5
Over 65........................................... 1,245 13.9 18.7 67.4
----------------------------------------------------------------------------------------------------------------
As we explain in Appendix B, we were not able to determine a
hospital-specific rate for 10 of the 5,207 hospitals in our data base.
Consequently, the payment methodology distribution is based on 5,197
hospitals. This data should be fully representative of the payment
methodologies that will be applicable to hospitals.
The cross-sectional distribution of hospital by payment methodology
is presented by: (1) geographic location, (2) region, and (3) payment
classification. This provides an indication of the percentage of
hospitals within a particular hospital grouping that will be paid under
the fully prospective payment methodology and under the hold-harmless
methodology.
The percentage of hospitals paid fully Federal (100 percent of
Federal rate) is expected to increase to 23.9 percent in FY 1996. As
noted above, these hospitals constitute approximately 58 percent of all
hold-harmless hospitals. In comparison, only 16.6 percent of hospitals
were paid fully Federal in FY 1995, representing only about 39 percent
of all hold-harmless hospitals. The cause of this increase is the
expiration of the budget neutrality provision, which resulted in a
large rate increase in the capital Federal rate. Due to the increase in
the Federal rate, more hold-harmless hospitals will fare better under
the fully Federal payment method.
Table IV indicates that 58.8 percent of hospitals are paid under
the fully prospective payment methodology. (This figure, unlike the
figure of 65 percent for low cost capital hospitals in the previous
section, takes account of the effects of redeterminations. In other
words, this figure does not include low cost hospitals that, following
a hospital-specific rate redetermination, are now paid under the hold-
harmless methodology.) As expected, a relatively higher percentage of
rural and governmental hospitals (72.4 percent and 74.0 percent,
respectively by payment classification) are being paid
[[Page 45939]]
under the fully prospective methodology. This is a reflection of their
lower than average capital costs per case. In contrast, only 30.4
percent of proprietary hospitals are being paid under the fully
prospective methodology. This is a reflection of their higher than
average capital costs per case. (We found at the time of the August 30,
1991 final rule (56 FR 43430) that 62.7 percent of proprietary
hospitals had a capital cost per case above the national average cost
per case.)
D. Cross-Sectional Analysis of Changes in Aggregate Payments
We used our FY 1996 actuarial model to estimate the potential
impact of our changes for FY 1996 on total capital payments per case,
using a universe of 5,197 hospitals. The individual hospital payment
parameters are taken from the best available data, including: the July
1, 1995 update to the Provider-Specific file, cost report data, and
audit information supplied by intermediaries. Table V presents
estimates of payments per case for FY 1995 and FY 1996 (columns 2 and
3). Column 4 shows the total percentage change in payments from FY 1995
to FY 1996. Column 5 presents the percentage change in payments that
can be attributed to Federal rate changes alone.
Federal rate changes represented in Column 5 include the 22.6
percent increase in the Federal rate, a 0.8 percent increase in case
mix, changes in the adjustments to the Federal rate (for example, the
effect of the new hospital wage index on the geographic adjustment
factor), and reclassifications by the Medicare Geographic
Classification Review Board. Column 4 includes the effects of the
Federal rate changes represented in column 3. Column 4 also includes
the effects of all other changes. Those other changes include: the
change from 40 percent to 50 percent in the portion of the Federal rate
for fully prospective hospitals, the hospital-specific rate update,
changes in the proportion of new to total capital for hold-harmless
hospitals, changes in old capital (for example, obligated capital put
in use), hospital-specific rate redeterminations, and exceptions. The
comparisons are provided by: (1) geographic location and (2) payment
classification and payment region.
The simulation results show that, on average, capital payments per
case can be expected to increase 20.6 percent in FY 1996. The results
show that the effect of the Federal rate changes alone is to increase
payments by 11.7 percent. In addition to the increase attributable to
the Federal rate changes, an 8.9 percent increase is attributable to
the effects of all other changes.
Our comparison by geographic location shows that urban hospitals
will gain slightly less than rural hospitals from the final rule
changes (rates of increase of 20.4 percent and 21.6 percent,
respectively). Urban hospitals will gain at approximately the same rate
as rural hospitals (11.7 and 11.6 percent) from the Federal rate
changes. Urban hospitals will gain slightly less than rural hospitals
(8.7 percent compared to 10.0 percent) from the effects of all other
changes.
By region, there is relatively little variation compared to some
previous years. All regions are estimated to receive large increases in
total capital payments per case, due to the expiration of the budget
neutrality provision. Increases by region vary from a low of 15.3 and
16.0 percent (rural Mountain and urban East South Central regions
respectively) to a high of 26.1 and 25.9 percent (rural hospitals of
the New England and Middle Atlantic regions respectively).
By type of ownership, proprietary hospitals are projected to have
the lowest rate of increase (16.7 percent, of which 11.7 percent is due
to Federal rate changes and 5.0 percent to the effects of all other
changes). In our proposed rule, proprietary hospitals had the highest
rate of increase. We believe that one factor contributing to the higher
estimated rate of increase for proprietary hospitals in the proposed
rule was the treatment of tax costs. Proportionately more proprietary
hospitals are subject to capital-related taxes than other categories of
hospitals. Proprietary hospitals experience the same rate of increase
attributable to Federal rate changes as all other hospitals (11.7
percent). Since this final rule does not incorporate the proposed
adjustment to the Federal rate for capital-related taxes, the estimated
rate of increase for proprietary hospitals is lower than that in the
proposed rule. Payments to voluntary hospitals will increase 21.0
percent (11.6 percent due to the Federal rate changes and 9.4 percent
due to the effects of all other changes) and payments to government
hospitals will increase 21.5 percent (12.3 percent due to Federal rate
changes and 9.2 percent due to the effects of all other changes).
Section 1886(d)(10) of the Act established the Medicare Geographic
Classification Review Board (MGCRB). Hospitals may apply for
reclassification for purposes of the wage index, standardized amount,
or both. Although the Federal capital rate is not affected, a
hospital's geographic classification for purposes of the operating
standardized amount does affect a hospital's capital payments as a
result of the large urban adjustment factor and the disproportionate
share adjustment for urban hospitals with 100 or more beds.
Reclassification for wage index purposes affects the geographic
adjustment factor since that factor is constructed from the hospital
wage index.
To present the effects of reclassification on the hospitals being
reclassified for FY 1996 compared to the effects of reclassification
for FY 1995, we show the average payment percentage increase for
hospitals reclassified in each fiscal year and in total. For FY 1996
reclassifications, we indicate those hospitals reclassified for
standardized amount purposes only, for wage index purposes only, and
for both purposes. The reclassified groups are compared to all other
nonreclassified hospitals. These categories are further identified by
urban and rural designation.
As a whole, hospitals reclassified during FY 1996 are projected to
experience a 22.5 percent increase in payments (12.2 percent
attributable to Federal rate changes and 10.3 percent attributable to
the effects of all other changes). Nonreclassified hospitals will gain
less (20.3 percent) than reclassified hospitals (22.5 percent) overall.
Nonreclassified hospitals will gain slightly less than reclassified
hospitals from the Federal rate changes (11.6 percent compared to 12.2
percent); they will also gain slightly less from the effects of all
other changes (8.7 percent compared to 10.3 percent).
In the proposed rule, Table V included two additional categories of
hospitals, according to whether they paid property taxes. We showed
these two additional categories of hospitals because of the expected
differences in the impact on each category of hospital of our proposed
changes with regard to capital-related taxes. Since we are not
implementing the proposed change concerning capital-related taxes, we
are not showing these categories of hospitals in Table V of this final
rule.
[[Page 45940]]
Table V.--Comparison of Total Payments Per Case
[FY 1995 Payments Compared to FY 1996 Payments]
----------------------------------------------------------------------------------------------------------------
Average FY Average FY Portion
Number of 1995 1996 attributable
hospitals payments/ payments/ All changes to Federal
case case rate change
----------------------------------------------------------------------------------------------------------------
By Geographic Location
----------------------------------------------------------------------------------------------------------------
All hospitals................................. 5,197 603 727 20.6 11.7
Large urban areas (populations over 1 million) 1,640 690 835 21.1 12.0
Other urban areas (populations of 1 million or
fewer)....................................... 1,294 605 721 19.3 11.2
Rural areas................................... 2,263 396 482 21.6 11.6
Urban hospitals............................... 2,934 654 787 20.4 11.7
0-99 beds................................. 749 501 596 18.9 10.6
100-199 beds.............................. 923 597 709 18.8 11.1
200-299 beds.............................. 595 615 739 20.2 12.1
300-499 beds.............................. 489 668 810 21.1 12.0
500 or more beds.......................... 178 806 978 21.4 11.5
Rural hospitals............................... 2,263 396 482 21.6 11.6
0-49 beds................................. 1,177 298 373 25.4 12.0
50-99 beds................................ 665 362 440 21.7 11.9
100-149 beds.............................. 227 429 517 20.4 12.1
150-199 beds.............................. 109 429 520 21.1 10.7
200 or more beds.......................... 85 510 616 20.7 11.1
----------------------------------------------------------------------------------------------------------------
By Region
----------------------------------------------------------------------------------------------------------------
Urban by Region............................... 2,934 654 787 20.4 11.7
New England............................... 163 633 778 22.8 12.9
Middle Atlantic........................... 441 683 842 23.3 12.1
South Atlantic............................ 433 661 777 17.6 10.6
East North Central........................ 490 602 732 21.6 11.9
East South Central........................ 164 615 714 16.0 9.2
West North Central........................ 196 640 770 20.2 11.5
West South Central........................ 387 687 799 16.2 11.5
Mountain.................................. 128 652 779 19.4 13.6
Pacific................................... 484 724 886 22.5 12.4
Puerto Rico............................... 48 263 315 19.6 10.8
Rural by Region............................... 2,263 396 482 21.6 11.6
New England............................... 53 524 661 26.1 9.6
Middle Atlantic........................... 84 400 503 25.9 13.4
South Atlantic............................ 300 414 499 20.5 12.3
East North Central........................ 305 385 470 21.9 11.1
East South Central........................ 278 372 447 20.2 11.6
West North Central........................ 529 368 453 23.2 12.1
West South Central........................ 352 380 460 21.1 11.2
Mountain.................................. 214 445 513 15.3 9.2
Pacific................................... 143 449 558 24.3 11.7
----------------------------------------------------------------------------------------------------------------
By Payment Classification
----------------------------------------------------------------------------------------------------------------
All hospitals................................. 5,197 603 727 20.6 11.7
Large urban areas (populations over 1 million) 1,828 677 821 21.3 12.0
Other urban areas (populations of 1 million or
fewer)....................................... 1,316 598 711 18.9 11.1
Rural areas................................... 2,053 382 465 21.7 11.6
Teaching Status:
Non-teaching.............................. 4,125 525 627 19.3 11.6
Fewer than 100 Residents.................. 841 632 767 21.2 11.6
100 or more Residents..................... 231 885 1,087 22.8 12.0
Disproportionate share hospitals (DSH):
Non-DSH................................... 3,225 547 661 20.8 11.4
Urban DSH:
100 or more beds...................... 1,436 684 823 20.3 11.9
Less than 100 beds.................... 144 467 554 18.6 12.4
Rural DSH:
Sole Community (SCH/EACH)............. 136 370 439 18.8 10.2
Referral Center (RRC/EACH)............ 29 456 547 20.0 10.6
Other Rural:
100 or more beds.................. 82 376 463 23.2 13.3
Less than 100 beds................ 145 297 369 24.5 14.6
Urban teaching and DSH:
Both teaching and DSH..................... 667 749 911 21.6 12.0
Teaching and no DSH....................... 356 650 795 22.2 11.2
No teaching and DSH....................... 913 594 701 18.1 11.7
[[Page 45941]]
No teaching and no DSH.................... 1,208 567 678 19.4 11.5
Rural Hospital Types:
Non special status hospitals.............. 1,300 336 417 24.1 13.0
RRC/EACH.................................. 91 476 575 20.9 11.0
SCH/EACH.................................. 623 392 466 19.0 10.0
SCH, RRC and EACH......................... 39 494 583 17.9 9.1
Hospitals Reclassified by the Medicare
Geographic Classification Review Board:
Reclassification Status During FY95 and
FY96:
Reclassified During Both FY95 and FY96 453 549 669 21.8 11.7
Reclassified During FY96 Only......... 147 499 626 25.4 14.2
Reclassified During FY95 Only......... 275 636 727 14.3 9.0
FY96 Reclassifications:
All Reclassified Hospitals............ 602 539 660 22.5 12.2
All Nonreclassified Hospitals......... 4,568 613 738 20.3 11.6
All Urban Reclassified Hospitals...... 195 624 766 22.9 12.0
Urban Nonreclassified Hospitals....... 2,739 656 789 20.2 11.7
All Reclassified Rural Hospitals...... 407 462 564 22.0 12.4
Rural Nonreclassified Hospitals....... 1,829 362 439 21.4 11.1
Other Reclassified Hospitals (Section
1886(D)(8)(B))........................... 27 438 527 20.4 10.5
Type of Ownership:
Voluntary................................. 3,139 616 745 21.0 11.6
Proprietary............................... 718 634 740 16.7 11.7
Government................................ 1,340 507 616 21.5 12.3
Medicare Utilization as a Percent of Inpatient
Days:
0-25...................................... 267 669 820 22.5 11.1
25-50..................................... 1,356 719 869 20.9 11.6
50-65..................................... 2,217 561 674 20.2 11.7
Over 65................................... 1,245 500 600 20.2 11.9
----------------------------------------------------------------------------------------------------------------
Appendix B--Technical Appendix on the Capital Acquisition Model and
Required Adjustments
Section 1886(g)(1)(A) of the Act requires that for FY 1992 through
FY 1995 aggregate prospective payments for operating costs under
section 1886(d) of the Act and prospective payments for capital costs
under section 1886(g) of the Act be reduced each year in a manner that
results in a 10 percent reduction of the amount that would have been
payable on a reasonable cost basis for capital-related costs in that
year. To implement this requirement, we developed the capital
acquisition model to determine the budget neutrality adjustment factor.
Even though the budget neutrality requirement expires effective with FY
1996, we must continue to determine the recalibration and geographic
reclassification budget neutrality adjustment factor, and the reduction
in the Federal and hospital-specific rates for exceptions payments. We
continue to use the capital acquisition model to determine these
factors.
The following data are used in the capital acquisition model: the
June 1995 update of the PPS-IX (cost reporting periods beginning in FY
1992) and PPS-X (cost reporting periods beginning in FY 1993) cost
reports, the July 1, 1995 update of the provider-specific file, and the
March 1994 update of the intermediary audit file. The available data
still lack certain items that were required for the determination of
budget neutrality, including each hospital's projected new capital
costs for each year, its projected old capital costs for each year, and
the projected obligated capital amounts that will be put in use for
patient care services and recognized as old capital each year.
Since hospitals under alternative payment system waivers (that is,
hospitals in Maryland) are currently excluded from the capital
prospective payment system, we excluded these hospitals from our model.
We then developed FY 1992, FY 1993, FY 1994, and FY 1995 hospital-
specific rates using the provider-specific file, the intermediary audit
file, and when available, cost reports. (We used the cumulative
provider-specific file, which includes all updates to each hospital's
records, and chose the latest record for each fiscal year.) We checked
the consistency between the provider-specific file and the intermediary
audit file. We also ensured that the FY 1993 increase in the hospital-
specific rate was at least 0.62 percent (the net FY 1993 update), that
the FY 1994 hospital-specific rate was at least as large as the FY 1993
hospital-specific rate decreased by 2.16 percent (the net FY 1994
update), and that the FY 1995 increase in the hospital-specific rate
was at least 0.05 percent (the net FY 1995 update). We were able to
match hospitals to the files as shown in the following table.
------------------------------------------------------------------------
Number of
Source hospitals
------------------------------------------------------------------------
Provider-Specific File Only................................ 97
Provider-Specific and Audit File........................... 5109
Neither File............................................... 1
Total................................................ 5207
------------------------------------------------------------------------
Seventy-one of these hospitals had unusable or missing data. We
were able to backfill a hospital-specific rate for 61 of these
hospitals from the cost reports as shown in the following table.
------------------------------------------------------------------------
Number of
Source hospitals
------------------------------------------------------------------------
PPS-V Cost Reports......................................... 3
PPS-VII Cost Reports....................................... 2
PPS-VIII Cost Reports...................................... 1
PPS-IX Cost Reports........................................ 9
PPS-X Cost Reports......................................... 21
[[Page 45942]]
PPS-XI Cost Reports........................................ 25
------------
Total................................................ 61
------------------------------------------------------------------------
We did not have data for 10 hospitals, and had to eliminate them
from the capital analysis. These hospitals likely are new hospitals or
hospitals with very few Medicare admissions. This leaves us with 5197
hospitals and should not affect the precision of the required
adjustment factors.
Next, we determined old and new capital amounts for FY 1992 using
the PPS-IX cost reports as the first source of data. For FY 1993 we
used PPS-IX and PPS-X cost reports as the first source of data,
weighting each cost report by the number of days in FY 1993. We were
able to match 5,125 PPS-IX cost reports and 5,090 PPS-X cost reports.
In cases where cost reports could not be matched, we used the provider-
specific file for old capital information. Even in cases where a cost
report was available, the breakout of old and new capital was not
always available. In these cases, we used the old capital amounts and
new capital ratios from the provider-specific file. If these were
missing, we derived the old capital amount from the hospital-specific
rate.
Finally, we used the intermediary audit file to develop obligated
capital amounts. Since the obligated amounts are aggregate projected
amounts, we computed a Medicare capital cost per admission associated
with these amounts. We adjusted the aggregate amounts by the following
factors:
(1) Medicare inpatient share of capital. This was derived from cost
reports and was limited to the Medicare share of total inpatient days.
It was necessary to limit the Medicare share because of data integrity
problems. Medicare share of inpatient days is a reasonably good proxy
for allocating capital. However, it may be understated if Medicare
utilization is high, and may be overstated because it does not reflect
the outpatient share of capital.
(2) Capitalization factor. This factor allocates the aggregate
amount of obligated capital to depreciation and interest amounts.
Consistent with the assumptions in the capital input price index, we
used a 25-year life for fixed capital and a 10-year life for movable
capital, and an average projected interest rate of 6.7 percent. We also
assumed that fixed capital acquisitions are about one-half of total
capital. In conjunction with the useful life and interest rate
assumptions, the resulting capitalized fixed capital is about one-half
of total capitalization. This is consistent with the allocations
between fixed and movable capital found on the cost reports. The ratio
we developed is 0.137, which produces the first year capitalization
based on the aggregate amount.
(3) A divisor of Medicare admissions to derive the capital per
discharge amount. Since we must project capital amounts for each
hospital, we continued to use a Monte Carlo simulation to develop these
amounts. (This model is described in detail in the August 30, 1991
final rule (56 FR 43517).) The Monte Carlo simulation is now used only
to project capital costs per discharge amounts for each hospital. We
analyzed the distributions of capital increases, and noted a slightly
negative correlation between the dollar level of capital cost per
admission, and the rate of increase in capital. To determine the rate
of increase in capital cost per admission, we multiplied the lesser of
$3,000 or the capital cost per admission by .00006 and subtracted this
result from 1.2. (Increases for capital levels over $3,000 were not
influenced by the level of capital, so this part of the calculation was
capped at $3,000.) We selected a random number from the normal
distribution, multiplied it by 0.17 (the standard deviation) and added
it to -0.04 (the mean) and then added 1 to create a multiplier. This
random result was multiplied by the previous result to assign a rate of
increase factor which was multiplied by the prior year's capital per
discharge amount to develop a capital per discharge amount for the
projected year.
To model a projected year, we used the old and new capital for the
prior year multiplied by 0.96 (aging factor). The 0.96 aging factor is
the average of changes in capital over its life. The aged new and old
capital is subtracted from the projected capital described in the
previous paragraph. The difference represents newly acquired capital.
We assume that the hospital would accrue only a half year of costs for
newly acquired capital in the year in which the capital comes on line.
This is because, on average, new capital will come on line in the
middle of the year. We make the same assumption for obligated capital.
If the hospital has obligated capital, the lesser of one half of the
adjusted costs (as described in the succeeding paragraph) for newly
acquired capital or one half of the costs (for FY 1993, all of the
costs) for obligated capital are deemed to apply to the current year.
The full year's costs for new or obligated capital are assumed to apply
for the following year. For FY 1994, one half of the costs for any
outstanding obligated capital were deemed to apply to FY 1994; a full
year's costs were deemed to apply to FY 1995. With the exception of
certain hospitals about whom we have information to the contrary, we
assume that hospitals would meet the expiration dates provided under
the obligated capital provision. The on-line obligated amounts are
added to old capital and subtracted from the newly acquired capital to
yield residual newly acquired capital, which is then added to new
capital. The residual newly acquired capital is never permitted to be
less than zero.
Next, we computed the average total capital cost per discharge from
the capital costs that were generated by the model and compared the
results to total capital costs per discharge that we had projected
independently of the model. We adjusted the newly acquired capital
amounts proportionately, so that the total capital costs per discharge
generated by the model match the independently projected capital costs
per discharge.
Once each hospital's capital-related costs are generated, the model
projects capital payments. We use the actual payment parameters (for
example, the case-mix index and the geographic adjustment factor) that
are applicable to the specific hospital.
To project capital payments, the model first assigns the applicable
payment methodology (fully prospective or hold-harmless) to the
hospital. If available, the model uses the payment methodology
indicated in the PPS-IX cost reports or the provider-specific file.
Otherwise, the model determines the methodology by comparing the
hospital's FY 1992 hospital-specific rate to the adjusted Federal rate
applicable to the hospital. The model simulates Federal rate payments
using the assigned payment parameters and hospital-specific estimated
outlier payments. The case-mix index for a hospital is derived from the
FY 1994 MedPAR file using the FY 1996 DRG relative weights published in
this rule. The case-mix index is increased each year after FY 1994
consistent with the continuing trend in case-mix increase.
We analyzed the case-mix increases for the recent past and found
that case-mix increases have decelerated to about 1.53 percent in FY
1992, 0.80 percent in FY 1993, and 0.75 percent in FY 1994. It appears
that the case-mix increase for FY 1995 will be around 1.4 percent. It
is too early to determine if the FY 1995 increase is a one time event,
or if it is the start of an accelerating trend. Because case-mix
increases have been
[[Page 45943]]
decelerating, we expect future case-mix increases to be moderate.
Therefore, in the model we have used a case-mix increase of 1.4 percent
in FY 1995 and a projected case-mix increase of 0.8 percent in FY 1996.
(Since we are using FY 1994 cases for our analysis, the FY 1994
increase in case mix has no effect on projected capital payments.)
Changes in geographic classification and revisions to the hospital
wage data used to establish the hospital wage index affect the
geographic adjustment factor. Changes in the DRG classification system
and the relative weights affect the case-mix index.
Section 1886(g)(1)(A) of the Act requires that, for discharges
occurring after September 30, 1993, the unadjusted standard Federal
rate be reduced by 7.4 percent. Consequently, the model reduces the
unadjusted standard Federal rate by 7.4 percent effective in FY 1994.
Since budget neutrality expires effective with FY 1996, this adjustment
affects the Federal rate starting in FY 1996.
The change in the method of paying transfer cases affects total
capital payments. We are making the effect of this change budget
neutral. To determine the budget neutrality adjustment factor for
transfers, we followed the methodology described in section VI.D of
Appendix A to this proposed rule. We computed the transfer-adjusted
number of discharges and case-mix under the current transfer policy,
and the proposed transfer policy for each hospital. We multiplied the
corresponding number of discharges and case-mix numbers for each
hospital and added all hospitals together. The number computed under
the current transfer policy divided by the number computed under the
proposed transfer policy yielded the transfer adjustment factor of
0.9972. This adjustment factor is applied to both the hospital-specific
rate and the Federal rate.
Section 412.308(c)(4)(ii) requires that the estimated aggregate
payments for the fiscal year, based on the Federal rate after any
changes resulting from DRG reclassifications and recalibration and the
geographic adjustment factor, equal the estimated aggregate payments
based on the Federal rate that would have been made without such
changes. For FY 1995, the budget neutrality adjustment factor was
1.0031. To determine the factor for FY 1996, we first determined the
portion of the Federal rate that would be paid for each hospital in FY
1996 based on its applicable payment methodology. We then compared
estimated aggregate Federal rate payments based on the FY 1995 DRG
relative weights and FY 1995 geographic adjustment factor to estimated
aggregate Federal rate payments based on the FY 1996 relative weights
and the FY 1996 geographic adjustment factor. In making the comparison,
we held the FY 1996 Federal rate portion constant and set the other
budget neutrality adjustment factor and exceptions reduction factor to
1.00. We determined that to achieve budget neutrality for the changes
in the geographic adjustment factor and DRG classifications and
relative weights, an incremental budget neutrality adjustment of 0.9994
for FY 1996 should be applied to the previous cumulative FY 1995
adjustment of 1.0031 (the product of the FY 1993 incremental adjustment
of 0.9980, the FY 1994 incremental adjustment of 1.0053, and the FY
1995 incremental adjustment of 0.9998), yielding a cumulative
adjustment of 1.0025 through FY 1996.
The methodology used to determine the recalibration and geographic
(DRG/GAF) budget neutrality adjustment factor is similar to that used
in establishing budget neutrality adjustments under the prospective
payment system for operating costs. One difference is that under the
operating prospective payment system, the budget neutrality adjustments
for the effect of geographic reclassifications are determined
separately from the effects of other changes in the hospital wage index
and the DRG weights. Under the capital prospective payment system,
there is a single DRG/GAF budget neutrality adjustment factor for
changes in the geographic adjustment factor (including geographic
reclassification) and the DRG relative weights. In addition, there is
no adjustment for the effects that geographic reclassification has on
the other payment parameters, such as the payments for serving low
income patients or the large urban add-on.
In addition to computing the DRG/GAF budget neutrality adjustment
factor, we used the model to simulate total payments under the
prospective payment system.
Additional payments under the exceptions process are accounted for
through a reduction in the Federal and hospital-specific rates.
Therefore, we used the model to calculate estimated exceptions payments
and the exceptions reduction factor. This exceptions reduction factor
ensures that estimated aggregate payments under the capital prospective
payment system, including exceptions payments, equal estimated
aggregate payments under the capital prospective payment system without
an exceptions process. Since changes in the level of the payment rates
change the level of payments under the exceptions process, the
exceptions reduction factor must be determined through iteration.
In the August 30, 1991 final rule (56 FR 43517), we indicated that
we would publish each year the estimated payment factors generated by
the model to determine payments for the next 5 years. The table below
provides the actual factors for FY 1992, FY 1993, FY 1994, FY 1995, FY
1996, and the estimated factors that would be applicable through FY
2000. We caution that, except with respect to FY 1992, FY 1993, FY
1994, FY 1995 and FY 1996, these are estimates only, and are subject to
revisions resulting from continued methodological refinements, more
recent data, and any payment policy changes that may occur. In this
regard, we note that in making these projections we have assumed that
the cumulative DRG/GAF adjustment factor will remain at 1.0025 for FY
1996 and later because we do not have sufficient information to
estimate the change that will occur in the factor for years after FY
1996.
The projections are as follows:
------------------------------------------------------------------------
Federal
Update Exceptions Budget rate (after
Fiscal year factor reduction neutrality outlier
factor factor reduction)
------------------------------------------------------------------------
1992................ N/A 0.9813 0.9602 415.59
1993................ 6.07 .9756 .9162 \1\ 417.29
1994................ 3.04 .9485 .8947 \2\ 378.34
1995................ 3.44 .9734 .8432 \3\ 376.83
1996................ 1.20 .9849 N/A \4\ 461.96
1997................ 1.70 .9822 N/A 468.53
1998................ 1.90 .9747 N/A 473.78
1999................ 1.90 .9608 N/A 475.90
[[Page 45944]]
2000................ 1.90 .9406 N/A 474.75
------------------------------------------------------------------------
\1\ Note: Includes the DRG/GAF adjustment factor of 0.9980 and the
change in the outlier adjustment from 0.9497 in FY 1992 to 0.9496 in
FY 1993.
\2\ Note: Includes the 7.4 percent reduction in the unadjusted standard
Federal rate. Also includes the DRG/GAF adjustment factor of 1.0033
and the change in the outlier adjustment from 0.9496 in FY 1993 to
0.9454 in FY 1994.
\3\ Note: Includes the DRG/GAF adjustment factor of 1.0031 and the
change in the outlier adjustment from 0.9454 in FY 1994 to 0.9414 in
FY 1995.
\4\ Note: Includes the transfer adjustment of .9972. Also includes the
DRG/GAF adjustment factor of 1.0025 and the change in the outlier
adjustment from 0.9414 in FY 1995 to 0.9536 in FY 1996. Future
adjustments are, for purposes of this projection, assumed to remain at
the same level.
Appendix C--Recommendation of Update Factors for Operating Cost Rates
of Payment for Inpatient Hospital Services
I. Background
Several provisions of the Social Security Act (the Act) address the
setting of update factors for services furnished in FY 1996 by
hospitals subject to the prospective payment system and those excluded
from the prospective payment system. Section 1886(b)(3)(B)(i)(XI) of
the Act sets the FY 1996 percentage increase in the operating cost
standardized amounts equal to the rate of increase in the hospital
market basket minus 2.0 percentage points for prospective payment
hospitals in all areas. Section 1886(b)(3)(B)(iv) of the Act sets the
FY 1996 percentage increase to the hospital-specific rate applicable to
sole community hospitals equal to the rate set forth in section
1886(b)(3)(B)(i) of the Act, that is, the same update factor as all
other hospitals subject to the prospective payment system, or the rate
of increase in the market basket minus 2.0 percentage points. Section
1886(b)(3)(B)(ii) of the Act sets the FY 1996 percentage increase in
the rate of increase limits for hospitals excluded from the prospective
payment system equal to the rate of increase in the excluded hospital
market basket minus the applicable reduction or, in the case of a
hospital in a fiscal year for which the hospital's update adjustment
percentage is at least 10 percent, the excluded hospital market basket
percentage increase. Under section 1886(b)(3)(B)(v) of the Act, a
hospital's update percentage increase for FY 1996 is the percentage
increase by which the hospital's allowable operating costs of inpatient
hospital services recognized under this title for the cost reporting
period beginning in FY 1990 exceed the hospital's target amount for
such cost reporting period, increased for each fiscal year (beginning
with FY 1994) by the sum of any of the hospital's applicable reductions
for previous years. The applicable reduction with respect to a hospital
for FY 1996 is the lesser of 1 percentage point or the percentage point
difference between 10 percent and the hospital's update adjustment
percentage for FY 1996.
In accordance with section 1886(d)(3)(A) of the Act, we are
updating the standardized amounts, the hospital-specific rates, and the
rate-of-increase limits for hospitals excluded for the prospective
payment system as provided in section 1886(b)(3)(B) of the Act. Based
on the second quarter 1995 forecasted market basket increase of 3.5
percent for hospitals subject to the prospective payment system, the
updates in the standardized amounts are 1.5 percent for hospitals in
both large urban and other areas. The update in the hospital-specific
rate applicable to sole community hospitals is 1.5 percent (that is,
the market basket rate of increase of 3.5 percent minus 2.0 percentage
points). The update for hospitals excluded from the prospective payment
system is based on the percentage increase in the excluded hospital
market basket (currently estimated at 3.4 percent) minus the applicable
reduction factor. The applicable reduction factor is the lesser of 1
percentage point or the percentage point difference between 10 percent
and the hospital's update adjustment percentage. Therefore, for
excluded hospitals, the hospital-specific update can vary between 2.4
and 3.4 percent.
Sections 1886(e) (2)(A) and (3)(A) of the Act require that the
Prospective Payment Assessment Commission (ProPAC) recommend to the
Congress by March 1 of each year an update factor that takes into
account changes in the market basket rate of increase index, hospital
productivity, technological and scientific advances, the quality of
health care provided in hospitals, and long-term cost effectiveness in
the provision of inpatient hospital services.
Section 1886(e)(4) of the Act requires that the Secretary, taking
into consideration the recommendations of ProPAC, recommend update
factors for each fiscal year that take into account the amounts
necessary for the efficient and effective delivery of medically
appropriate and necessary care of high quality. Under section
1886(e)(5) of the Act, we published the FY 1996 update factors
recommended pursuant to section 1886(e)(4) of the Act as Appendix D of
the June 2, 1995 proposed rule (60 FR 29380).
II. Secretary's Final Recommendations for Updating the Prospective
Payment System Standardized Amounts
We received several public comments concerning our proposed
recommendations. After consideration of the arguments presented, we
have decided that our final recommendation will be the same as our
proposed recommendation. That is, we are recommending that the
standardized amounts be increased by an amount equal to the market
basket rate of increase minus 2.0 percentage points for hospitals
located in large urban and other areas. We are also recommending an
update of the market basket rate of increase minus 2.0 percentage
points to the hospital-specific rate for sole community hospitals.
These figures are consistent with the President's budget
recommendation.
In recommending these increases, we have followed section
1886(e)(4) of the Act, which requires that we take into account the
amounts necessary for the efficient and effective delivery of medically
appropriate and necessary care of high quality. In addition, as
required by section 1886(e)(4) of the Act, we have taken into
consideration the recommendations of ProPAC. We believe our analyses,
which measure changes in hospital productivity, scientific and
technological advances, practice pattern changes, and changes in case
mix, support our recommendations.
Comment: One commenter expressed concern with what appears to be a
systematic bias in estimation of the market basket forecast. Because we
have overestimated the market basket for
[[Page 45945]]
several years, the commenter believes that our model is likely to be
incorrect in its parameters or methodology and suggested that we
continue to revise the model or change the underlying estimation
methodology.
Response: We agree with the commenter that there has been a pattern
of high forecasts over the past few years in the market basket
estimation. We have been working with our contractor during the past
year to thoroughly review the forecast equations for the hospital input
price indexes. This review produced substantial improvements in both
the forecast equations and the processes used to forecast. HCFA and its
contractor will closely monitor the future forecasts for accuracy. In
this final rule, we present input price indexes that are forecasted
using the improved forecast equations.
Comment: We received one comment recommending an adjustment to the
market basket for new technologies. The commenter stated that this
adjustment would reflect the change in the use of new resources that
may increase costs and productivity.
Response: The hospital market basket is an input price index that
measures changes in the prices paid for a fixed set of goods and
services. We do not believe an adjustment to the market basket for
changes resulting from use of new technology is appropriate. Although
we do not adjust the hospital market basket for new technology, the
update framework accounts for the role of new technologies in two ways.
First, we account for cost-increasing, quality-enhancing new
technologies in the intensity component of our update recommendation
(which is an add-on to the market basket rate of increase). Second, we
account for cost-decreasing new technologies through a productivity
adjustment. This adjustment allows for those technologies that permit
hospitals to treat their patients at lower cost.
Comment: We received two comments strongly urging us to consider
how hospital-specific wages and benefits are incorporated into the
market basket. They suggest increasing the internal hospital wage and
benefit shares to 50 percent.
Response: We responded to a similar comment in detail in the
September 4, 1990 final rule (55 FR 36047), when the current hospital
market basket was implemented. We prefer to use 100 percent economy-
wide proxies for those occupations that are generally employed inside
and outside hospitals, such as managers, administrators, clerical, and
maintenance workers. We believe that the economy-wide rate of increase
is the more appropriate measure for these types of employees, since
that is the relevant labor market for these employees. In contrast, we
use a 50/50 blend of hospital-industry proxies and economy-wide proxies
for professional and technical workers. We believe this is appropriate
because the group includes workers, such as registered nurses, that are
not hired in large numbers in other sectors of the economy.
Comment: ProPAC's comment stated several concerns about the single
intensity adjustment included in HCFA's update framework and believes
that each element should be quantified separately.
Response: We continue to disagree with ProPAC that accounting
separately for changes in within-DRG complexity, science and technology
changes, and practice patterns would be more accurate. In view of the
interactive nature of these elements, we believe it is difficult to
measure accurately the effects of each element separately. Instead, we
believe that it is more appropriate and accurate to account for all
three elements in a single measure. Thus, our intensity measure is
designed to encompass the net effect of all three changes. With regard
to practice pattern changes, which are also reflected in our intensity
adjustment, we do not adjust for changes that have not taken place.
Comment: ProPAC questioned HCFA's continued use of projected case-
mix change in the update formula instead of actual case-mix change.
Response: Our update analysis takes into account changes in case
mix adjusted for changes attributable to improved coding practices and
DRG reclassification and recalibration. In the past, we used the
observed increase in case mix for the most recent year available. For
example, we based our FY 1994 update on the observed increase in case
mix from FY 1992. Recent data on case-mix change demonstrates that the
growth of case-mix severity has slowed.
The use of projected case mix allows us to take into account
emerging trends in case mix more quickly. We note that ProPAC uses an
estimate of the total case-mix index in the year prior to the update as
part of its update framework. We have decided it is best to use our
estimate of what case-mix change will be in the year of the update.
This is consistent with the use of the forecasted value of change in
the market basket over the coming year.
Comment: ProPAC believes it is inappropriate to adjust the
prospective payment amounts separately for case-mix changes that HCFA
attributes to reclassification or recalibration, either through
changing the weights or the standardized amounts.
Response: We believe that it is appropriate to account for case-mix
index changes attributed to reclassification or recalibration within
the update framework. This adjustment is determined by comparing the
average case weight for the actual cases in a given year based on the
DRG relative weights for that year with the average case weight for the
same cases based on the DRG relative weights for the previous year.
Since the same cases are used on both sides of the comparison, the
difference in case-mix index reflects the change in aggregate payments
attributable solely to the new GROUPER and relative weights.
III. Secretary's Final Recommendation for Updating the Rate-of-
Increase Limits for Excluded Hospitals and Units
Our final recommendation will be that hospitals and hospital units
excluded from the prospective payment system receive an update equal to
the percentage increase in the market basket that measures input price
increases for services furnished by excluded hospitals minus 1.0
percentage point. Thus, given the current estimate of the change in
rate of increase in the market basket for excluded hospitals of 3.4
percent (compared with an earlier estimate of 3.6 percent used in the
proposed rule), our final recommendation is for an update of 2.4
percent. We note that the updates for hospitals and units excluded from
the prospective payment system as set in Public Law 103-66 is the
market basket rate of increase minus 1.0 percentage point, adjusted to
account for the relationship between the provider's allowable operating
cost per case and its target amount.
We received the following comments concerning our proposed
recommendation on the update factor for excluded hospitals and hospital
units.
Comment: One commenter states that the Secretary provides no
explicit framework to support her recommendation beyond what is
included in current law. This commenter is concerned about forecasting
errors that have resulted in updates that are too high and believes an
explicit framework should be used in developing future recommendations.
Another commenter recommends that we include an upward adjustment to
the market basket rate of increase to account for new technology.
Response: The update for the prospective payment system for
inpatient operating costs adjusts the
[[Page 45946]]
market basket for a number of factors including case mix, productivity
and intensity. Currently, in the absence of any adjustment for patient
severity, there is no mechanism for determining case mix for excluded
hospitals and units. Nevertheless, we will examine the feasibility of
establishing a framework for an appropriate rate-of-increase limit for
services paid on the basis of reasonable costs. Changes in some
factors, such as new services or more resources, may be more
appropriately accommodated through the exceptions process. As we study
developing an update framework for excluded hospitals and units, we
will consider an adjustment for technology, if its impact on hospital
costs can be accurately measured.
With regard to forecasting errors, as discussed above, we have been
working with our contractor to review and make improvements in hospital
input price indices. This review has produced substantial improvements
in forecast equations and procedures, and we have implemented these
changes in developing the input price indices used in this final rule.
[FR Doc. 95-21541 Filed 8-31-95; 8:45 am]
BILLING CODE 4120-01-P