May 30, 2008

**VIA ELECTRONIC SUBMISSION AND**

**FEDEX OVERNIGHT DELIVERY**

Federal Docket Management System Office

1160 Defense Pentagon

Washington, DC 20301-1160

**Re: Agency: Office of the Secretary, Department of Defense (RIN \#
0720-AB19);**

> **[TRICARE; Outpatient Hospital Prospective Payment System
> ("OPPS")]{.underline}.**

To Whom It May Concern:

Metroplex Adventist Hospital ("Metroplex") welcomes the opportunity to
comment on the Department of Defense's (the "DOD") proposed rule
entitled "*TRICARE; Outpatient Hospital Prospective Payment System
(OPPS)*", 63 Fed. Reg. 17271 (April 1, 2008) ("the "Proposed Rule").

In the Proposed Rule, the DOD implements a prospective payment system
for certain hospital outpatient services ("TRICARE OPPS"). We are
concerned that certain Tricare dependant hospitals will be negatively
impacted to the point that ongoing service capability to military
personnel and their families will be severely limited. For instance, it
is expected that upon implementation of TRICARE OPPS, overall
reimbursement rates for Metroplex outpatient services will fall by as
much as thirty-nine percent (39%). With the high volume of TRICARE
patients being seen by Metroplex in support of military readiness and
contingency operations, implementation of TRICARE OPPS will surely
result in a decrement of service availability. A reasonable solution
would be to create criteria for alternative reimbursement methodologies
that would reflect an institutions dependence upon TRICARE. Suggested
minimum thresholds are incorporated herein.

Such latitude is already provided for in the TRICARE Program. Chapter 13
of the TRICARE Reimbursement Manual 6010.55-M, August 1, 2002 provides
that: "alternative network reimbursement methodologies are permitted
when approved by TRICARE Management Activity (TMA) and specifically
included in the network provider agreement."

In 63 Fed. Reg. page 17287, the DOD stated that it developed two options
for implementation of TRICARE OPPS for certain network hospitals. The
DOD described the second option as follows:

> The second option involves authority for the Director, TRICARE
> Management Activity, or a designee, under provisions of this rule to
> adopt, modify, and/or extend temporary adjustments to OPPS payments
> for TRICARE network hospitals deemed essential for military readiness
> and support during contingency operations. Upon a determination by the
> TMA Director, or designee, at any time following implementation that
> it is impracticable to support military readiness or contingency
> operations by making OPPS payments in accordance with the same
> reimbursement rules implemented by Medicare, a temporary deviation may
> be granted. This will ensure the availability of adequate civilian
> healthcare resources necessary to meet all ongoing military readiness
> and contingencies....

In order to support ongoing military readiness or contingency
operations, Metroplex respectfully petitions the DOD to implement the
following provisions into the Proposed Rule:

**Temporary Deviations and/or Adjustments to TRICARE OPPS**

\(a\) *Exemption for network hospitals serving a disproportionate number
of TRICARE patients.* The Director, TRICARE Management Activity (TMA),
or a designee, shall grant an exemption from TRICARE OPPS payments to a
network hospital(s) located close to a military installation which has a
"Uniformed Population", as defined in subparagraph (a)(1) below, and
that meets the criteria defined in subparagraph (a)(2) below.

\(1\) A hospital located within two (2) road miles of any active gate of
a military installation where, on average during the year, thirty
thousand (30,000) or more members of the uniformed services on active
duty are assigned (a "Uniformed Population").

\(2\) A hospital serves a disproportionate share of TRICARE patients if
it meets any one of the following criteria:

\(i\) The hospital derives sixty-five percent (65%) percent or more of
its gross patient service revenue from all government program funds; or

\(ii\) The hospital's outpatient billed gross charges for TRICARE
covered outpatient services is twenty percent (20%) or more of the
hospital's total outpatient billed gross charges.

\(3\) A written request for an exemption must be submitted to TMA no
later than November 1st prior to the calendar year for which the
exemption would become effective. Such exemption would be effective on
January 1^st^ of such calendar year. If TRICARE OPPS is initially
implemented on a date other than January 1st, hospital shall make the
request for exemption at least thirty (30) days prior to the TRICARE
OPPS implementation date provided that the hospital has knowledge of the
TRICARE OPPS implementation date at least sixty (60) days in advance.
Under such circumstances, the effective date of such exemption would be
the TRICARE OPPS implementation date. In the event the hospital does not
have such knowledge sixty (60) days in advance of the TRICARE OPPS
implementation date then hospital can at any time make a request for
exemption which exemption shall have an effective date of the thirtieth
(30th) day following submission of such request. A request for exemption
should identify the hospital by name, street address, provider number,
the military installation near which it is located, and shall include
information showing that the hospital meets exemption criteria as
defined in subparagraphs (a)(1) and (a)(2) above. The data included in
the hospital's request for an exemption should be from the hospital's
most recently completed fiscal year prior to the due date for the
request. An officer of the hospital shall certify that the information
contained in the exemption request is accurate and true to the best of
his or her knowledge.

\(4\) An exemption shall be valid for a six (6) year term effective as
of the date the exemption is granted to the network hospital. The
hospital shall have the right to reapply for an exemption for an
additional six (6) year term which exemption shall be automatically
granted by the Director, TMA, or a designee, if the network hospital
continues to meet the exemption criteria as defined in subparagraphs
(a)(1) and (a)(2) above.

\(b\) *Payment rates for network hospitals entitled to an exemption*.
The outpatient payment rates for hospitals meeting the requirement for
an exemption shall be the TRICARE Maximum Allowable Charge (TMAC) rates
in effect prior to the implementation of TRICARE OPPS, as designated in
the provider contract signed by the exempted hospital (e.g., TMAC, ASC
Grouper rates, or billed charges). The TMAC rates for exempted network
hospitals shall be adjusted upward annually by the same update factors
used to adjust the rates paid for covered hospital outpatient services
under TMAC.

We thank you for the opportunity to review and comment on the Proposed
Rule. We look forward to working with the DOD on the issues discussed
herein. Should you have any questions or would like to discuss these
issues further, please feel free to call me at (254) 519-8165.

Sincerely,

![](media/image1.wmf){width="1.6236111111111111in"
height="0.6243055555555556in"}

Kenneth A. Finch

President/CEO

Metroplex Adventist Hospital