Vol. 79 Tuesday, 

No. 87 May 6, 2014 

Part III 

Department of Health and Human Services 

Centers for Medicare & Medicaid Services 

42 CFR Part 412 

Medicare Program; Inpatient Psychiatric Facilities Prospective Payment 

System—Update for Fiscal Year Beginning October 1, 2014 (FY 2015); 

Proposed Rule 


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26040 Federal Register / Vol. 79, No. 87 / Tuesday, May 6, 2014 / Proposed Rules 

DEPARTMENT OF HEALTH AND 

HUMAN SERVICES 

Centers for Medicare & Medicaid 

Services 

42 CFR Part 412 

[CMS–1606–P] 

RIN 0938–AS08 

Medicare Program; Inpatient 

Psychiatric Facilities Prospective 

Payment System—Update for Fiscal 

Year Beginning October 1, 2014 (FY 

2015) 

AGENCY: Centers for Medicare & 

Medicaid Services (CMS), HHS. 

ACTION: Proposed rule. 

SUMMARY: This proposed rule would 

update the prospective payment rates 

for Medicare inpatient hospital services 

provided by inpatient psychiatric 

facilities (IPFs). These changes would be 

applicable to IPF discharges occurring 

during the fiscal year (FY) beginning 

October 1, 2014 through September 30, 

2015. This proposed rule would also 

address implementation of ICD–10–CM 

and ICD–10–PCS codes; propose a new 

methodology for updating the cost of 

living adjustment (COLA), and propose 

new quality measures and reporting 

requirements under the IPF quality 

reporting program. 

DATES: To be assured consideration, 

comments must be received at one of 

the addresses provided below, no later 

than 5 p.m. on June 30, 2014. 

FOR FURTHER INFORMATION CONTACT: 

Dorothy Myrick or Jana Lindquist, (410) 

786–4533, for general information. 

Hudson Osgood, (410) 786–7897 or 

Bridget Dickensheets, (410) 786–8670, 

for information regarding the market 

basket and labor-related share. 

Theresa Bean, (410) 786–2287, for 

information regarding the regulatory 

impact analysis. 

Rebecca Kliman, (410) 786–9723 or 

Jeffrey Buck, (410) 786–0407, for 

information regarding the inpatient 

psychiatric facility quality reporting 

program. 

SUPPLEMENTARY INFORMATION: 

Table of Contents 

To assist readers in referencing 

sections contained in this document, we 

are providing the following table of 

contents. 

I. Executive Summary 

A. Purpose 

B. Summary of the Major Provisions 

C. Summary of Transfers 

II. Background 

A. Annual Requirements for Updating the 

IPF PPS 

B. Overview of the Legislative 

Requirements of the IPF PPS 

C. General Overview of the IPF PPS 

III. Changing the IPF PPS Payment Rate 

Update Period From a Rate Year to a 

Fiscal Year 

IV. Proposed Market Basket for the IPF PPS 

A. Background 

B. Proposed Development of an IPFSpecific Market Basket 

C. Proposed FY 2015 Market Basket Update 

D. Proposed Labor-Related Share 

V. Proposed Updates to the IPF PPS for FY 

Beginning October 1, 2014 

A. Determining the Standardized BudgetNeutral Federal Per Diem Base Rate 

B. Proposed Update of the Federal Per 

Diem Base Rate and Electroconvulsive 

Therapy Rate 

VI. Proposed Update of the IPF PPS 

Adjustment Factors 

A. Overview of the IPF PPS Adjustment 

Factors 

B. Proposed Patient-Level Adjustments 

1. Proposed Adjustment for MS–DRG 

Assignment 

2. Proposed Payment for Comorbid 

Conditions 

3. Proposed Patient Age Adjustments 

4. Proposed Variable Per Diem 

Adjustments 

C. Facility-Level Adjustments 

1. Proposed Wage Index Adjustment 

a. Background 

b. Proposed Wage Index for FY 2015 

c. OMB Bulletins 

2. Proposed Adjustment for Rural Location 

3. Proposed Teaching Adjustment 

a. FTE Intern and Resident Cap Adjustment 

b. Temporary Adjustment to the FTE Cap 

To Reflect Residents Added Due to 

Hospital Closure 

c. Temporary Adjustment to FTE Cap To 

Reflect Residents Affected By Residency 

Program Closure 

i. Receiving IPF 

ii. IPF That Closed Its Program 

4. Proposed Cost of Living Adjustment for 

IPFs Located in Alaska and Hawaii 

5. Proposed Adjustment for IPFs With a 

Qualifying Emergency Department (ED) 

D. Other Payment Adjustments and 

Policies 

1. Proposed Outlier Payments 

a. Proposed Update to the Outlier Fixed 

Dollar Loss Threshold Amount 

b. Proposed Update to IPF Cost-to-Charge 

Ratio Ceilings 

2. Future Refinements 

VII. Secretary’s Recommendations 

VIII. Inpatient Psychiatric Facilities Quality 

Reporting Program 

IX. Collection of Information Requirements 

X. Response to Comments 

XI. Regulatory Impact Analysis 

Addenda 

Acronyms 

Because of the many terms to which 

we refer by acronym in this propose 

rule, we are listing the acronyms used 

and their corresponding meanings in 

alphabetical order below: 

BBRA—Medicare, Medicaid and SCHIP 

[State Children’s Health Insurance 

Program] Balanced Budget Refinement Act 

of 1999 (Pub. L. 106–113) 

CBSA—Core-Based Statistical Area 

CCR—Cost-to-Charge Ratio 

CAH—Critical Access Hospital 

DSM–IV–TR Diagnostic and Statistical 

Manual of Mental Disorders Fourth 

Edition—Text Revision 

DRGs—Diagnosis-Related Groups 

FY—Federal Fiscal Year (October 1 through 

September 30) 

ICD–9–CM—International Classification of 

Diseases, 9th Revision, Clinical 

Modification 

ICD–10–CM—International Classification of 

Diseases, 10th Revision, Clinical 

Modification 

ICD–10–PCS—International Classification of 

Diseases, 10th Revision, Procedure Coding 

System 

IPFs—Inpatient Psychiatric Facilities 

IPFQR—Inpatient Psychiatric Facilities 

Quality Reporting 

IRFs—Inpatient Rehabilitation Facilities 

LTCHs—Long-Term Care Hospitals 

MAC—Medicare Administrative Contractor 

MedPAR—Medicare Provider Analysis and 

Review File 

RPL—Rehabilitation, Psychiatric, and LongTerm Care 

RY—Rate Year (July 1 through June 30) 

TEFRA—Tax Equity and Fiscal 

Responsibility Act of 1982 (Pub. L. 97–248) 

I. Executive Summary 

A. Purpose 

This proposed rule would update the 

prospective payment rates for Medicare 

inpatient hospital services provided by 

inpatient psychiatric facilities for 

discharges occurring during the fiscal 

year (FY) beginning October 1, 2014 

through September 30, 2015. 

B. Summary of the Major Provisions 

In this proposed rule, we would 

update the IPF PPS, as specified in 42 

CFR 412.428. The updates include the 

following: 

• The FY 2008-based Rehabilitation, 

Psychiatric, and Long Term Care (RPL) 

market basket update (currently 

estimated to be 2.7 percent) would be 

adjusted by a 0.3 percentage point 

reduction as required by section 

1886(s)(2)(A)(ii) of the Social Security 

Act (the Act) and a reduction for 

economy-wide productivity (currently 

estimated to be 0.4 percentage point) as 

required by 1886(s)(2)(A)(i) of the Act. 

• The FY 2015 per diem rate would 

be updated from $713.19 to $727.67. 

• The electroconvulsive therapy 

payment would be updated from 

$307.04 to $313.27. 

• The fixed dollar loss threshold 

amount would be updated from $10,245 

to $10,125 in order to maintain outlier 

payments that are 2 percent of total IPF 

PPS payments. 

• The national urban and rural costto-charge ratio (CCR) ceilings for FY 


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2015 would be 1.7049 and 1.8823, 

respectively, and the national median 

CCR would be 0.6220 for rural IPFs and 

0.4700 for urban IPFs. These amounts 

are used in the outlier calculation to 

determine if an IPF’s CCR is statistically 

accurate and for new providers without 

an established CCR. 

• The cost of living adjustment 

factors for IPFs located in Alaska and 

Hawaii would be updated using the 

approach finalized in the FY 2014 

inpatient hospital prospective payment 

system (IPPS) final rule (78 FR 50985 

through 50987). 

In addition: 

• We are proposing the ICD–10–CM/ 

PCS codes that would be eligible for the 

MS–DRG and comorbidity payment 

adjustments under the IPF PPS. The 

effective date of those changes would be 

the date when ICD–10–CM becomes the 

required medical data code set for use 

on Medicare claims. 

• We are proposing the ICD–9–CM/

PCS codes that would be eligible for the 

MS–DRG and comorbidity payment 

adjustments under the IPF PPS. 

• We would use the best available 

hospital wage index and establish the 

wage index budget-neutrality 

adjustment of 1.0003. 

• We would retain the 17 percent 

payment adjustment for IPFs located in 

rural areas, the 1.31 payment 

adjustment factor for IPFs with a 

qualifying emergency department, the 

coefficient value of 0.5150 for the 

teaching adjustment, and the MS–DRG 

adjustment factors and comorbidity 

adjustment factors currently being paid 

to IPFs in FY 2014. 

C. Summary of Impacts 

Provision description Total transfers 

FY 2015 IPF PPS payment rate update.The overall economic impact of this proposed rule is an estimated $100 million in increased payments to 

IPFs during FY 2015. 

Provision description Costs 

New quality reporting program requirements.The total costs in FY 2015 for IPFs as a result of the proposed new quality reporting requirements are estimated to be $33,372,508. 

II. Background 

A. Annual Requirements for Updating 

the IPF PPS 

In November 2004, we implemented 

the inpatient psychiatric facilities (IPF) 

prospective payment system (PPS) in a 

final rule that appeared in the 

November 15, 2004 Federal Register (69 

FR 66922). In developing the IPF PPS, 

in order to ensure that the IPF PPS is 

able to account adequately for each 

IPF’s case-mix, we performed an 

extensive regression analysis of the 

relationship between the per diem costs 

and certain patient and facility 

characteristics to determine those 

characteristics associated with 

statistically significant cost differences 

on a per diem basis. For characteristics 

with statistically significant cost 

differences, we used the regression 

coefficients of those variables to 

determine the size of the corresponding 

payment adjustments. 

In that final rule, we explained that 

we believe it is important to delay 

updating the adjustment factors derived 

from the regression analysis until we 

have IPF PPS data that include as much 

information as possible regarding the 

patient-level characteristics of the 

population that each IPF serves. 

Therefore, we indicated that we did not 

intend to update the regression analysis 

and the patient- and facility-level 

adjustments until we complete that 

analysis. Until that analysis is complete, 

we stated our intention to publish a 

notice in the Federal Register each 

spring to update the IPF PPS (71 FR 

27041). We have begun the necessary 

analysis to make refinements to the IPF 

PPS using more current data to set the 

adjustment factors, however, we are not 

proposing those refinements in this 

proposed rule. Rather, as explained in 

section V.D.3 of this proposed rule, we 

expect that in future rulemaking, 

possibly for FY 2017, we will be ready 

to propose potential refinements. 

In the May 6, 2011 IPF PPS final rule 

(76 FR 26432), we changed the payment 

rate update period to a rate year (RY) 

that coincides with a fiscal year (FY) 

update. Therefore, update notices are 

now published in the Federal Register 

in the summer to be effective on October 

1. When proposing changes in IPF 

payment policy, a proposed rule would 

be issued in the spring and the final rule 

in the summer in order to be effective 

on October 1. For further discussion on 

changing the IPF PPS payment rate 

update period to a RY that coincides 

with a FY, see the IPF PPS final rule 

published in the Federal Register on 

May 6, 2011 (76 FR 26434 through 

26435). For a detailed list of updates to 

the IPF PPS, see 42 CFR 412.428. 

Our most recent IPF PPS annual 

update occurred in an August 1, 2013, 

Federal Register notice (78 FR 46734) 

(hereinafter referred to as the August 

2013 IPF PPS notice) that set forth 

updates to the IPF PPS payment rates 

for FY 2014. That notice updated the 

IPF PPS per diem payment rates that 

were published in the August 2012 IPF 

PPS notice (77 FR 47224) in accordance 

with our established policies. 

B. Overview of the Legislative 

Requirements for the IPF PPS 

Section 124 of the Medicare, 

Medicaid, and SCHIP (State Children’s 

Health Insurance Program) Balanced 

Budget Refinement Act of 1999 (BBRA) 

(Pub. L. 106–113) required the 

establishment and implementation of an 

IPF PPS. Specifically, section 124 of the 

BBRA mandated that the Secretary 

develop a per diem PPS for inpatient 

hospital services furnished in 

psychiatric hospitals and psychiatric 

units including an adequate patient 

classification system that reflects the 

differences in patient resource use and 

costs among psychiatric hospitals and 

psychiatric units. 

Section 405(g)(2) of the Medicare 

Prescription Drug, Improvement, and 

Modernization Act of 2003 (MMA) (Pub. 

L. 108–173) extended the IPF PPS to 

distinct part psychiatric units of critical 

access hospitals (CAHs). 

Section 3401(f) of the Patient 

Protection and Affordable Care Act 

(Pub. L. 111–148) as amended by 

section 10319(e) of that Act and by 

section 1105(d) of the Health Care and 

Education Reconciliation Act of 2010 

(Pub. L. 111–152) (hereafter referred to 

as ‘‘the Affordable Care Act’’) added 

subsection (s) to section 1886 of the Act. 

Section 1886(s)(1) of the Act titled 

‘‘Reference to Establishment and 

Implementation of System’’ refers to 

section 124 of the BBRA, which relates 

to the establishment of the IPF PPS. 

Section 1886(s)(2)(A)(i) of the Act 

requires the application of the 

productivity adjustment described in 


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section 1886(b)(3)(B)(xi)(II) of the Act to 

the IPF PPS for the RY beginning in 

2012 (that is, a RY that coincides with 

a FY) and each subsequent RY. For the 

RY beginning in 2014 (that is, FY 2015), 

the current estimate of the productivity 

adjustment would be equal to 0.4 

percentage point, which we are 

proposing in this FY 2015 proposed 

rule. 

Section 1886(s)(2)(A)(ii) of the Act 

requires the application of an ‘‘other 

adjustment’’ that reduces any update to 

an IPF PPS base rate by percentages 

specified in section 1886(s)(3) of the Act 

for the RY beginning in 2010 through 

the RY beginning in 2019. For the RY 

beginning in 2014 (that is, FY 2015), 

section 1886(s)(3)(C) of the Act requires 

the reduction to be 0.3 percentage point. 

We are proposing that reduction in this 

FY 2015 IPF PPS proposed rule. 

Section 1886(s)(4) of the Act requires 

the establishment of a quality data 

reporting program for the IPF PPS 

beginning in RY 2014. We proposed and 

finalized new requirements for quality 

reporting for IPFs in the ‘‘Hospital 

Inpatient Prospective Payment System 

for Acute Care Hospitals and the Long 

Term Care Hospital Prospective 

Payment System and Fiscal Year 2014 

Rates’’ proposed rule published on May 

10, 2013 (78 FR 27486, 27734 through 

27744) and final rule published on 

August 19, 2013 (78 FR 50496, 50887 

through 50903). 

To implement and periodically 

update these provisions, we have 

published various proposed and final 

rules in the Federal Register. For more 

information regarding these rules, see 

the CMS Web site at http://

www.cms.hhs.gov/

InpatientPsychFacilPPS/. 

C. General Overview of the IPF PPS 

The November 2004 IPF PPS final 

rule (69 FR 66922) established the IPF 

PPS, as required by section 124 of the 

BBRA and codified at subpart N of part 

412 of the Medicare regulations. The 

November 2004 IPF PPS final rule set 

forth the per diem Federal rates for the 

implementation year (the 18-month 

period from January 1, 2005 through 

June 30, 2006), and provided payment 

for the inpatient operating and capital 

costs to IPFs for covered psychiatric 

services they furnish (that is, routine, 

ancillary, and capital costs, but not costs 

of approved educational activities, bad 

debts, and other services or items that 

are outside the scope of the IPF PPS). 

Covered psychiatric services include 

services for which benefits are provided 

under the fee-for-service Part A 

(Hospital Insurance Program) of the 

Medicare program. 

The IPF PPS established the Federal 

per diem base rate for each patient day 

in an IPF derived from the national 

average daily routine operating, 

ancillary, and capital costs in IPFs in FY 

2002. The average per diem cost was 

updated to the midpoint of the first year 

under the IPF PPS, standardized to 

account for the overall positive effects of 

the IPF PPS payment adjustments, and 

adjusted for budget-neutrality. 

The Federal per diem payment under 

the IPF PPS is comprised of the Federal 

per diem base rate described above and 

certain patient- and facility-level 

payment adjustments that were found in 

the regression analysis to be associated 

with statistically significant per diem 

cost differences. 

The patient-level adjustments include 

age, DRG assignment, comorbidities, 

and variable per diem adjustments to 

reflect higher per diem costs in the early 

days of an IPF stay. Facility-level 

adjustments include adjustments for the 

IPF’s wage index, rural location, 

teaching status, a cost-of-living 

adjustment for IPFs located in Alaska 

and Hawaii, and the presence of a 

qualifying emergency department (ED). 

The IPF PPS provides additional 

payment policies for: Outlier cases; 

interrupted stays; and a per treatment 

adjustment for patients who undergo 

electroconvulsive therapy (ECT). During 

the IPF PPS mandatory 3-year transition 

period, stop-loss payments were also 

provided; however, since the transition 

ended in 2008, these payments are no 

longer available. 

A complete discussion of the 

regression analysis that established the 

IPF PPS adjustment factors appears in 

the November 2004 IPF PPS final rule 

(69 FR 66933 through 66936). 

Section 124 of the BBRA did not 

specify an annual rate update strategy 

for the IPF PPS and was broadly written 

to give the Secretary discretion in 

establishing an update methodology. 

Therefore, in the November 2004 IPF 

PPS final rule, we implemented the IPF 

PPS using the following update strategy: 

• Calculate the final Federal per diem 

base rate to be budget-neutral for the 18- 

month period of January 1, 2005 

through June 30, 2006. 

• Use a July 1 through June 30 annual 

update cycle. 

• Allow the IPF PPS first update to be 

effective for discharges on or after July 

1, 2006 through June 30, 2007. 

III. Changing the IPF PPS Payment Rate 

Update Period From a Rate Year to a 

Fiscal Year 

Prior to RY 2012, the IPF PPS was 

updated on a July 1 through June 30 

annual update cycle. Effective with RY 

2012, we switched the IPF PPS payment 

rate update from a rate year that begins 

on July 1 and ends on June 30 to a 

period that coincides with a fiscal year. 

In order to transition from a RY to a FY, 

the IPF PPS RY 2012 covered a 15- 

month period from July 1 through 

September 30. As proposed and 

finalized, after RY 2012, the rate year 

update period for the IPF PPS payment 

rates and other policy changes begin on 

October 1 through September 30. 

Therefore, the update cycle for FY 2015 

will be October 1, 2014 through 

September 30, 2015. 

For further discussion of the 15- 

month market basket update for RY 

2012 and changing the payment rate 

update period from a RY to a FY, we 

refer readers to the RY 2012 IPF PPS 

proposed rule (76 FR 4998) and the RY 

2012 IPF PPS final rule (76 FR 26432). 

IV. Proposed Market Basket for the IPF 

PPS 

A. Background 

The input price index (that is, the 

market basket) that was used to develop 

the IPF PPS was the Excluded Hospital 

with Capital market basket. This market 

basket was based on 1997 Medicare cost 

report data and included data for 

Medicare participating IPFs, inpatient 

rehabilitation facilities (IRFs), long-term 

care hospitals (LTCHs), cancer 

hospitals, and children’s hospitals. 

Although ‘‘market basket’’ technically 

describes the mix of goods and services 

used in providing hospital care, this 

term is also commonly used to denote 

the input price index (that is, cost 

category weights and price proxies 

combined) derived from that market 

basket. Accordingly, the term ‘‘market 

basket’’ as used in this document refers 

to a hospital input price index. 

Beginning with the May 2006 IPF PPS 

final rule (71 FR 27046 through 27054), 

IPF PPS payments were updated using 

a FY 2002-based market basket 

reflecting the operating and capital cost 

structures for IRFs, IPFs, and LTCHs 

(hereafter referred to as the 

Rehabilitation, Psychiatric, and LongTerm Care (RPL) market basket). 

We excluded cancer and children’s 

hospitals from the RPL market basket 

because these hospitals are not 

reimbursed through a PPS; rather, their 

payments are based entirely on 

reasonable costs subject to rate-ofincrease limits established under the 

authority of section 1886(b) of the Act, 

which are implemented in regulations at 

§ 413.40. Moreover, the FY 2002 cost 

structures for cancer and children’s 

hospitals are noticeably different than 

the cost structures of the IRFs, IPFs, and 


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LTCHs. A complete discussion of the FY 

2002-based RPL market basket appears 

in the May 2006 IPF PPS final rule (71 

FR 27046 through 27054). 

In the RY 2012 IPF PPS proposed rule 

(76 FR 4998) and final rule (76 FR 

26432), we proposed and finalized the 

use of a rebased and revised FY 2008- 

based RPL market basket to update IPF 

payments. 

B. Development of an IPF-Specific 

Market Basket 

In the May 1, 2009 IPF PPS notice (74 

FR 20362), we expressed our interest in 

exploring the possibility of creating a 

stand-alone, or IPF-specific market 

basket that reflects the cost structures of 

only IPF providers. We noted that, of 

the available options, one would be to 

join the Medicare cost report data from 

freestanding IPF providers with data 

from hospital-based IPF providers. We 

indicated that an examination of the 

Medicare cost report data comparing 

freestanding and hospital-based IPFs 

revealed considerable differences 

between the two with respect to cost 

levels and cost structures. At that time, 

we stated that we were unable to fully 

explain the differences in costs between 

freestanding and hospital-based IPF 

providers. As a result, we felt that 

further research was required and we 

solicited public comments for 

additional information that might help 

explain the reasons for the variations in 

costs and cost structures, as indicated 

by the cost report data (74 FR 20376). 

We summarized the public comments 

we received and our responses in the 

April 2010 IPF PPS notice (75 FR 23111 

through 23113). 

Since the April 2010 IPF PPS notice 

was published, we have made 

significant progress on the development 

of a stand-alone, or IPF-specific, market 

basket. Our research has focused on 

addressing several concerns regarding 

the use of the hospital-based IPF 

Medicare cost report data in the 

calculation of the major market basket 

cost weights. As discussed above, one 

concern is the cost level differences for 

hospital-based IPFs relative to 

freestanding IPFs that were not readily 

explained by the specific characteristics 

of the individual providers and the 

patients that they serve (for example, 

case mix, urban/rural status, teaching 

status). Furthermore, we are concerned 

about the variability in the cost report 

data among these hospital-based IPF 

providers and the potential impact on 

the market basket cost weights. These 

concerns led us to consider whether it 

is appropriate to use the universe of IPF 

providers to derive an IPF-specific 

market basket. 

Recently, we have investigated the 

use of regression analysis to evaluate the 

effect of including hospital-based IPF 

Medicare cost report data in the 

calculation of cost distributions. We 

created preliminary regression models 

to try to explain variations in costs per 

day across both freestanding and 

hospital-based IPFs. These models were 

intended to capture the effects of 

facility-level and patient-level 

characteristics (for example, wage 

index, urban/rural status, ownership 

status, length-of-stay, occupancy rate, 

case mix, and Medicare utilization) on 

IPF costs per day. Using the results from 

the preliminary regression analyses, we 

identified smaller subsets of hospitalbased and freestanding IPF providers 

where the predicted costs per day using 

the regression model closely matched 

the actual costs per day for each IPF. We 

then derived different sets of cost 

distributions using (1) these subsets of 

IPF providers and (2) the entire universe 

of freestanding and hospital-based IPF 

providers (including those IPFs for 

which the variability in cost levels 

remains unexplained). After comparing 

these sets of cost distributions, the 

differences were not substantial enough 

for us to conclude that the inclusion of 

those IPF providers with unexplained 

variability in costs in the calculation of 

the cost distributions is a major cause 

for concern. 

Another concern with incorporating 

the hospital-based IPF data in the 

derivation of an IPF-specific market 

basket is the complexity of the Medicare 

cost report data for these providers. The 

freestanding IPFs independently submit 

a Medicare cost report for their 

facilities, making it relatively 

straightforward to obtain the cost 

categories necessary to determine the 

major market basket cost weights. 

However, cost report data submitted for 

a hospital-based IPF are embedded in 

the Medicare cost report submitted for 

the entire hospital facility in which the 

IPF is located. Therefore, adjustments 

would have to be made to obtain cost 

weights that represent just the hospitalbased IPF (as opposed to the hospital as 

a whole). For example, ancillary costs 

for services such as clinic services, 

drugs charged to patients, and 

emergency services for the entire 

hospital would need to be appropriately 

converted to a value that only represents 

the hospital-based IPF unit’s cost. The 

preliminary method we have developed 

to allocate these costs is complex and 

still needs to be fully evaluated before 

we are ready to propose an IPF-specific 

market basket that would reflect both 

hospital-based and freestanding IPF 

data. 

We would also note that our current 

preliminary data show higher labor 

costs for IPFs than observed for the 

2008-based RPL market basket. This 

increase is driven primarily by higher 

compensation cost as a percent of total 

costs for IPFs. In our ongoing research, 

we are also evaluating the differences in 

salary costs as a percent of total costs for 

both hospital-based and freestanding 

IPFs. Salary costs are historically the 

largest component of the market baskets. 

Based on our review of the data reported 

on the applicable Medicare cost reports, 

our initial findings (using the 

preliminary allocation method as 

discussed above) have shown that the 

hospital-based IPF salary costs as a 

percent of total costs tend to be lower 

than those of freestanding IPFs. We are 

still evaluating the methods for deriving 

salary costs as a percent of total costs 

and need to further investigate the 

percentage of ancillary costs that should 

be appropriately allocated to the IPF 

salary costs for the hospital-based IPF, 

as discussed above. 

Also, effective for cost reports 

beginning on or after May 1, 2010, we 

finalized a revised Hospital and 

Hospital Health Care Complex Cost 

Report, Form CMS 2552–10, (74 FR 

31738). The report is available for 

download from the CMS Web site at 

http://www.cms.gov/Research-StatisticsData-and-Systems/Files-for-Order/

CostReports/Hospital-2010-form.html. 

The revised Hospital and Hospital 

Health Care Complex Cost Report 

includes a new worksheet (Worksheet 

S–3, part V) that identifies the contract 

labor costs and benefit costs for the 

hospital/hospital care complex and is 

applicable to sub-providers and units. 

Our analysis of Worksheet S–3, part V 

shows significant underreporting of this 

data with fewer than 20 freestanding IPF 

providers reporting it. We encourage 

providers to submit this data so we can 

use it to calculate benefits and contract 

labor cost weights for the market basket. 

In the absence of this data, we will 

likely use the 2008-based RPL market 

basket methodology (76 FR 5003) to 

calculate the IPF benefit cost weight. 

This methodology calculates the ratio of 

the IPPS benefit cost weight to the IPPS 

salary cost weight and applies this ratio 

to the IPF salary cost weight in order to 

estimate the IPF benefit cost weight. For 

contract labor, in the absence of IPFspecific data, we will use a similar 

methodology. 

For the reasons discussed above, 

while we believe we have made 

significant progress on the development 

of an IPF-specific market basket, we 


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believe that further research is required 

at this time. As a result, we are not 

proposing an IPF-specific market basket 

for FY 2015. We plan to complete our 

research during the remainder of this 

year and, provided that we are prepared 

to draw conclusions from our research, 

may propose an IPF-specific market 

basket for the FY 2016 rulemaking 

cycle. We welcome public comments on 

the preliminary findings discussed 

above. 

C. Proposed FY 2015 Market Basket 

Update 

The proposed FY 2015 update for the 

IPF PPS using the FY 2008-based RPL 

market basket and IHS Global Insight’s 

first quarter 2014 forecast of the market 

basket components is 2.7 percent (prior 

to the application of statutory 

adjustments). IHS Global Insight, Inc. 

(IGI) is a nationally recognized 

economic and financial forecasting firm 

that contracts with CMS to forecast the 

components of the market baskets. 

As previously described in section 

I.B, section 1886(s)(2)(A)(i) of the Act 

requires the application of the 

productivity adjustment described in 

section 1886(b)(3)(B)(xi)(II) of the Act to 

the IPF PPS for the RY beginning in 

2012 and each subsequent RY. The 

statute defines the productivity 

adjustment to be equal to the 10-year 

moving average of changes in annual 

economy-wide private nonfarm business 

multifactor productivity (MFP) (as 

projected by the Secretary for the 10- 

year period ending with the applicable 

FY, year, cost reporting period, or other 

annual period) (the ‘‘MFP adjustment’’). 

The Bureau of Labor Statistics (BLS) 

publishes the official measure of private 

non-farm business MFP. We refer 

readers to the BLS Web site at http://

www.bls.gov/mfp to obtain the BLS 

historical published MFP data. The MFP 

adjustment for FY 2015 applicable to 

the IPF PPS is derived using a 

projection of MFP that is currently 

produced by IGI. For a detailed 

description of the model currently used 

by IGI to project MFP, as well as a 

description of how the MFP adjustment 

is calculated, we refer readers to the FY 

2012 IPPS/LTCH final rule (76 FR 51690 

through 51692). Based on IGI’s first 

quarter 2014 forecast, the proposed 

productivity adjustment for FY 2015 is 

0.4 percentage point. Section 

1886(s)(2)(A)(ii) of the Act also requires 

the application of an ‘‘other adjustment’’ 

that reduces any update to an IPF PPS 

base rate by percentages specified in 

section 1886(s)(3) of the Act for rate 

years beginning in 2010 through the RY 

beginning in 2019. For the RY beginning 

in 2014 (that is, FY 2015), the reduction 

is 0.3 percentage point. We are 

proposing to implement the 

productivity adjustment and ‘‘other 

adjustment’’ in this FY 2015 IPF PPS 

proposed rule. 

In summary, we propose to base the 

FY 2015 market basket update, which is 

used to determine the applicable 

percentage increase for the IPF 

payments, on the most recent estimate 

of the FY 2008-based RPL market basket 

(currently estimated to be 2.7 percent 

based on IGI’s first quarter 2014 

forecast). We propose to then reduce 

this percentage increase by the current 

estimate of the MFP adjustment for FY 

2015 of 0.4 percentage point (the 10- 

year moving average of MFP for the 

period ending FY 2015 based on IGI’s 

first quarter 2014 forecast). Following 

application of the MFP, we propose to 

further reduce the applicable percentage 

increase by 0.3 percentage point, as 

required by section 1886(s)(3) of the 

Act. The current estimate of the 

proposed FY 2015 IPF update is 2.0 

percent (2.7 percent market basket 

update, less 0.4 percentage point MFP 

adjustment, less 0.3 percentage point 

‘‘other’’ adjustment). Furthermore, we 

also are proposing that if more recent 

data are subsequently available (for 

example, a more recent estimate of the 

market basket and MFP adjustment), we 

would use such data, if appropriate, to 

determine the FY 2015 market basket 

update and MFP adjustment in the final 

rule. 

D. Proposed Labor-Related Share 

Due to variations in geographic wage 

levels and other labor-related costs, we 

believe that payment rates under the IPF 

PPS should continue to be adjusted by 

a geographic wage index, which would 

apply to the labor-related portion of the 

Federal per diem base rate (hereafter 

referred to as the labor-related share). 

The labor-related share is determined 

by identifying the national average 

proportion of total costs that are related 

to, influenced by, or vary with the local 

labor market. We classify a cost category 

as labor-related if the costs are laborintensive and vary with the local labor 

market. Based on our definition of the 

labor-related share, we include in the 

labor-related share the sum of the 

relative importance of Wages and 

Salaries, Employee Benefits, 

Professional Fees: Labor-related, 

Administrative and Business Support 

Services, All Other: Labor-related 

Services, and a portion of the CapitalRelated cost weight. 

Therefore, to determine the proposed 

labor-related share for the IPF PPS for 

FY 2015, we used the FY 2008-based 

RPL market basket cost weights relative 

importance to determine the laborrelated share for the IPF PPS. This 

estimate of the FY 2015 labor-related 

share is based on IGI’s first quarter 2014 

forecast, which is the same forecast used 

to derive the FY 2015 market basket 

update. 

Table 1 below shows the FY 2015 

relative importance labor-related share 

using the FY 2008-based RPL market 

basket along with the FY 2014 relative 

importance labor-related share. 

TABLE 1—PROPOSED FY 2015 RELATIVE IMPORTANCE LABOR-RELATED SHARE AND THE FY 2014 RELATIVE IMPORTANCE

LABOR-RELATED SHARE BASED ON THE FY 2008-BASED RPL MARKET BASKET

FY 2014 relative 

importance laborrelated share 1

Proposed FY 2015 

relative importance 

labor-related 

share 2

Wages and Salaries ................................................................................................................................ 48.394 48.409 

Employee Benefits ................................................................................................................................... 12.963 13.016 

Professional Fees: Labor-Related ........................................................................................................... 2.065 2.065 

Administrative and Business Support Services ....................................................................................... 0.415 0.417 

All Other: Labor-Related Services ........................................................................................................... 2.080 2.070 

Subtotal ............................................................................................................................................. 65.917 65.977 

Labor-Related Portion of Capital Costs (46%) ........................................................................................ 3.577 3.561 


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TABLE 1—PROPOSED FY 2015 RELATIVE IMPORTANCE LABOR-RELATED SHARE AND THE FY 2014 RELATIVE IMPORTANCE

LABOR-RELATED SHARE BASED ON THE FY 2008-BASED RPL MARKET BASKET—Continued 

FY 2014 relative 

importance laborrelated share 1

Proposed FY 2015 

relative importance 

labor-related 

share 2

Total Labor-Related Share ........................................................................................................ 69.494 69.538 

1. Published in the FY 2014 IPF PPS notice (78 FR 46738) and based on IHS Global Insight, Inc.’s second quarter 2013 forecast of the FY 

2008-based RPL market basket. 

2. Based on IHS Global Insight, Inc.’s first quarter 2014 forecast of the FY 2008-based RPL market basket. 

The proposed labor-related share for 

FY 2015 is the sum of the FY 2015 

relative importance of each labor-related 

cost category, and would reflect the 

different rates of price change for these 

cost categories between the base year 

(FY 2008) and FY 2015. The sum of the 

relative importance for FY 2015 for 

operating costs (Wages and Salaries, 

Employee Benefits, Professional Fees: 

Labor-Related, Administrative and 

Business Support Services, and All 

Other: Labor-related Services) is 65.977 

percent, as shown in Table 1 above. The 

portion of Capital-related cost that is 

influenced by the local labor market is 

estimated to be 46 percent. Since the 

relative importance for Capital-Related 

Costs is 7.742 percent of the FY 2008- 

based RPL market basket in FY 2015, we 

take 46 percent of 7.742 percent to 

determine the labor-related share of 

Capital-related cost for FY 2015. The 

result is 3.561 percent, which we add to 

65.977 percent for the operating cost 

amount to determine the total laborrelated share for FY 2015. Therefore, the 

proposed labor-related share for the IPF 

PPS in FY 2015 is 69.538 percent. This 

labor-related share is determined using 

the same general methodology as 

employed in calculating all previous IPF 

labor-related shares (see, for example, 

69 FR 66952 through 66953). 

Furthermore, we are also proposing that 

if more recent data are subsequently 

available (for example, a more recent 

estimate of the labor-related share), we 

would use such data, if appropriate, to 

determine the FY 2015 labor-related 

share in the final rule. The wage index 

and the labor-related share are reflected 

in budget-neutrality adjustments. 

V. Proposed Updates to the IPF PPS for 

FY 2015 (Beginning October 1, 2014) 

The IPF PPS is based on a 

standardized Federal per diem base rate 

calculated from the IPF average per 

diem costs and adjusted for budgetneutrality in the implementation year. 

The Federal per diem base rate is used 

as the standard payment per day under 

the IPF PPS and is adjusted by the 

patient-level and facility-level 

adjustments that are applicable to the 

IPF stay. A detailed explanation of how 

we calculated the average per diem cost 

appears in the November 2004 IPF PPS 

final rule (69 FR 66926). 

A. Determining the Standardized 

Budget-Neutral Federal Per Diem Base 

Rate 

Section 124(a)(1) of the BBRA 

required that we implement the IPF PPS 

in a budget-neutral manner. In other 

words, the amount of total payments 

under the IPF PPS, including any 

payment adjustments, must be projected 

to be equal to the amount of total 

payments that would have been made if 

the IPF PPS were not implemented. 

Therefore, we calculated the budgetneutrality factor by setting the total 

estimated IPF PPS payments to be equal 

to the total estimated payments that 

would have been made under the Tax 

Equity and Fiscal Responsibility Act of 

1982 (TEFRA) (Pub. L. 97–248) 

methodology had the IPF PPS not been 

implemented. A step-by-step 

description of the methodology used to 

estimate payments under the TEFRA 

payment system appears in the 

November 2004 IPF PPS final rule (69 

FR 66926). 

Under the IPF PPS methodology, we 

calculated the final Federal per diem 

base rate to be budget-neutral during the 

IPF PPS implementation period (that is, 

the 18-month period from January 1, 

2005 through June 30, 2006) using a July 

1 update cycle. We updated the average 

cost per day to the midpoint of the IPF 

PPS implementation period (that is, 

October 1, 2005), and this amount was 

used in the payment model to establish 

the budget-neutrality adjustment. 

Next, we standardized the IPF PPS 

Federal per diem base rate to account 

for the overall positive effects of the IPF 

PPS payment adjustment factors by 

dividing total estimated payments under 

the TEFRA payment system by 

estimated payments under the IPF PPS. 

Additional information concerning this 

standardization can be found in the 

November 2004 IPF PPS final rule (69 

FR 66932) and the RY 2006 IPF PPS 

final rule (71 FR 27045). We then 

reduced the standardized Federal per 

diem base rate to account for the outlier 

policy, the stop loss provision, and 

anticipated behavioral changes. A 

complete discussion of how we 

calculated each component of the 

budget-neutrality adjustment appears in 

the November 2004 IPF PPS final rule 

(69 FR 66932 through 66933) and in the 

May 2006 IPF PPS final rule (71 FR 

27044 through 27046). The final 

standardized budget-neutral Federal per 

diem base rate established for cost 

reporting periods beginning on or after 

January 1, 2005 was calculated to be 

$575.95. 

The Federal per diem base rate has 

been updated in accordance with 

applicable statutory requirements and 

42 CFR 412.428 through publication of 

annual notices or proposed and final 

rules. These documents are available on 

the CMS Web site at http://

www.cms.hhs.gov/

InpatientPsychFacilPPS/. A detailed 

discussion on the standardized budgetneutral Federal per diem base rate and 

the electroconvulsive therapy (ECT) rate 

appears in the August 2013 IPF PPS 

update notice (78 FR 46738 through 

46739). 

B. Proposed FY 2015 Update of the 

Federal Per Diem Base Rate and 

Electroconvulsive Therapy (ECT) Rate 

In accordance with section 

1886(s)(2)(A)(ii) of the Act, which 

requires the application of an ‘‘other 

adjustment,’’ described in section 

1886(s)(3) of the Act (specifically, 

section 1886(s)(3)(C)) for RY 2014 that 

reduces the update to the IPF PPS base 

rate for the FY beginning in Calendar 

Year (CY) 2014, we are proposing to 

adjust the IPF PPS update by a 0.3 

percentage point reduction for FY 2015. 

In addition, in accordance with section 

1886(s)(2)(A)(i) of the Act, which 

requires the application of the 

productivity adjustment that reduces 

the update to the IPF PPS base rate for 

the FY beginning in CY 2014, we are 

proposing to adjust the IPF PPS update 

by a 0.4 percentage point reduction for 

FY 2015. 


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The current (that is, FY 2014) Federal 

per diem base rate is $713.19 and the 

ECT base rate is $307.04. For FY 2015, 

we are proposing to apply an update of 

2.0 percent (that is the proposed FY 

2008-based RPL market basket increase 

for FY 2015 of 2.7 percent less the 

proposed productivity adjustment of 0.4 

percentage point less the 0.3 percentage 

point required under 

section1886(s)(3)(C) of the Act), and the 

wage index budget-neutrality factor of 

1.0003 (as discussed in section VI.C.1. 

of this proposed rule) to the FY 2014 

Federal per diem base rate of $713.19, 

yielding a proposed Federal per diem 

base rate of $727.67 for FY 2015. 

Similarly, we are proposing to apply the 

2.0 percent payment update, and the 

1.0003 wage index budget-neutrality 

factor to the FY 2014 ECT base rate, 

yielding a proposed ECT base rate of 

$313.27 for FY 2015. 

As noted above, section 1886(s)(4) of 

the Act requires the establishment of a 

quality data reporting program for the 

IPF PPS beginning in RY 2014. We 

finalized new requirements for quality 

reporting for IPFs in the ‘‘Hospital 

Inpatient Prospective Payment Systems 

for Acute Care Hospitals and the Long 

Term Care Hospital Prospective 

Payment System and Fiscal Year 2014 

Rates’’ proposed rule published on May 

10, 2013 (78 FR 27486, 27734 through 

27744) and final rule published on 

August 19, 2013 (78 FR 50496, 50887 

through 50903). Section 1886(s)(4)(A)(i) 

of the Act requires that, for RY 2014 and 

each subsequent rate year, the Secretary 

shall reduce any annual update to a 

standard Federal rate for discharges 

occurring during the rate year by 2.0 

percentage points for any IPF that does 

not comply with the quality data 

submission requirements with respect to 

an applicable year. Therefore, we are 

proposing to apply a 2.0 percentage 

point reduction to the Federal per diem 

base rate and the ECT base rate as 

follows: 

For IPFs that fail to submit quality 

reporting data under the IPFQR 

program, we are applying a 0 percent 

annual update (that is 2 percent reduced 

by 2 percentage points in accordance 

with section 1886(s)(4)(A)(ii) of the Act) 

and the wage index budget-neutrality 

factor of 1.0003 to the FY 2014 Federal 

per diem base rate of $713.19, yielding 

a Federal per diem base rate of $713.40 

for FY 2015. 

Similarly, we are applying the 0 

percent annual update and the 1.0003 

wage index budget-neutrality factor to 

the FY 2014 ECT base rate of $307.04, 

yielding an ECT base rate of $307.13 for 

FY 2015. 

In the FY 2014 IPPS/LTCH PPS final 

rule (78 FR50496), we adopted two new 

measures for the FY 2016 payment 

determination and subsequent years for 

the IPFQR Program. We also finalized a 

request for voluntary information 

whereby IPFs will be asked to provide 

information on the patient experience of 

care survey. For the FY 2016 payment 

determination and subsequent years, we 

are proposing to add two new measures 

to those already adopted for the FY 2016 

payment determination and subsequent 

years. For the FY 2017 payment 

determination and subsequent years, we 

are proposing to adopt four new 

measures. 

VI. Proposed Update of the IPF PPS 

Adjustment Factors 

A. Overview of the IPF PPS Adjustment 

Factors 

The IPF PPS payment adjustments 

were derived from a regression analysis 

of 100 percent of the FY 2002 MedPAR 

data file, which contained 483,038 

cases. For a more detailed description of 

the data file used for the regression 

analysis, see the November 2004 IPF 

PPS final rule (69 FR 66935 through 

66936). While we have since used more 

recent claims data to simulate payments 

to set the fixed dollar loss threshold 

amount for the outlier policy and to 

assess the impact of the IPF PPS 

updates, we continue to use the 

regression-derived adjustment factors 

established in 2005 for FY 2015. 

As we stated previously, we have 

begun an analysis of more current IPF 

claims and cost report data however; we 

are not proposing refinements to the IPF 

PPS in this proposed rule. Once our 

analysis is complete, we will propose to 

update the adjustment factors in a future 

notice of proposed rulemaking. 

However, we continue to monitor 

claims and payment data independently 

from cost report data to assess issues, to 

determine whether changes in case-mix 

or payment shifts have occurred among 

freestanding governmental, non-profit 

and private psychiatric hospitals, and 

psychiatric units of general hospitals, 

and CAHs and other issues of 

importance to IPFs. 

On April 1, 2014, the Protecting 

Access to Medicare Act of 2014 (PAMA) 

(Pub. L. 113–93) was enacted. Section 

212 of PAMA, titled ‘‘Delay in 

Transition from ICD–9 to ICD–10 Code 

Sets,’’ provides that ‘‘[t]he Secretary of 

Health and Human Services may not, 

prior to October 1, 2015, adopt ICD–10 

code sets as the standard for code sets 

under section 1173(c) of the Social 

Security Act (42 U.S.C. 1320d–2(c)) and 

§ 162.1002 of title 45, Code of Federal 

Regulations.’’ As of now, the Secretary 

has not implemented this provision 

under HIPAA. We are proposing the 

conversion of ICD–9–CM to ICD–10– 

CM/PCS codes for the IPF PPS in this 

proposed rule, but in light of PAMA, the 

effective date of those changes would be 

the date when ICD–10 becomes the 

required medical data code set for use 

on Medicare claims, whenever that date 

may be. Until that time, we will 

continue to require use of the ICD–9– 

CM codes for reporting the MS–DRG 

and comorbidity adjustment factors for 

IPF services. 

B. Proposed Patient-Level Adjustments 

The IPF PPS includes payment 

adjustments for the following patientlevel characteristics: Medicare Severity 

diagnosis related groups (MS–DRGs) 

assignment of the patient’s principal 

diagnosis, selected comorbidities, 

patient age, and the variable per diem 

adjustments. 

1. Proposed Adjustment for MS–DRG 

Assignment 

We believe it is important to maintain 

the same diagnostic coding and DRG 

classification for IPFs that are used 

under the IPPS for providing psychiatric 

care. For this reason, when the IPF PPS 

was implemented for cost reporting 

periods beginning on or after January 1, 

2005, we adopted the same diagnostic 

code set (ICD–9–CM) and DRG patient 

classification system (that is, the CMS 

DRGs) that were utilized at the time 

under the IPPS. In the May 2008 IPF 

PPS notice (73 FR 25709), we discussed 

CMS’s effort to better recognize resource 

use and the severity of illness among 

patients. CMS adopted the new MS– 

DRGs for the IPPS in the FY 2008 IPPS 

final rule with comment period (72 FR 

47130). In the 2008 IPF PPS notice (73 

FR 25716) we provided a crosswalk to 

reflect changes that were made under 

the IPF PPS to adopt the new MS–DRGs. 

For a detailed description of the 

mapping changes from the original DRG 

adjustment categories to the current 

MS–DRG adjustment categories, we 

refer readers to the May 2008 IPF PPS 

notice (73 FR 25714). 

The IPF PPS includes payment 

adjustments for designated psychiatric 

DRGs assigned to the claim based on the 

patient’s principal diagnosis. The DRG 

adjustment factors were expressed 

relative to the most frequently reported 

psychiatric DRG in FY 2002, that is, 

DRG 430 (psychoses). The coefficient 

values and adjustment factors were 

derived from the regression analysis. 

Mapping the DRGs to the MS–DRGs 

resulted in the current 17 IPF–MS– 

DRGs, instead of the original 15 DRGs, 


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for which the IPF PPS provides an 

adjustment. For FY 2015, as we did in 

FY 2013 (77 FR 47231) and FY 2014 (78 

FR 46741 through 46741), we propose to 

make a payment adjustment for 

psychiatric diagnoses that group to one 

of the 17 MS–IPF–DRGs listed in Table 

2. Psychiatric principal diagnoses that 

do not group to one of the 17 designated 

DRGs would still receive the Federal per 

diem base rate and all other applicable 

adjustments, but the payment would not 

include a DRG adjustment. 

In the Standards for Electronic 

Transaction final rule, published in the 

Federal Register on August 17, 2000 (65 

FR 50312), the Department adopted the 

International Classification of Diseases, 

9th Revision, Clinical Modification 

(ICD–9–CM) as the HIPAA designated 

code set for reporting diseases, injuries, 

impairments, other health related 

problems, their manifestations, and 

causes of injury. Therefore, on January 

1, 2005 when the IPF PPS began, we 

used ICD–9–CM as the designated code 

set for the IPF PPS. IPF claims with a 

principal diagnosis included in Chapter 

Five of the ICD–9–CM are paid the 

Federal per diem base rate and all other 

applicable adjustments, including any 

applicable DRG adjustment. However, 

as we indicated in the FY 2014 IPF PPS 

notice (78 FR 46741), in accordance 

with the requirements of the final rule 

published in the Federal Register on 

September 5, 2012 (77 FR 54664), we 

will be discontinuing the use of ICD–9– 

CM codes. We are proposing the 

conversion of ICD–9–CM to ICD–10– 

CM/PCS codes for the IPF PPS in this 

proposed rule, but in light of PAMA, the 

effective date of those changes would be 

the date when ICD–10 becomes the 

required medical data code set for use 

on Medicare claims. Until that time, we 

will continue to require use of the ICD– 

9–CM codes for reporting the MS–DRGs 

for IPF services. The ICD–10–CM/PCS 

coding guidelines are available through 

the CMS Web site at: 

www.cms.gov/Medicare/Coding/

ICD10/downloads/pcs_2012_

guidelines.pdf and http://www.cms.gov/ 

Medicare/Coding/ICD10/

index.html?redirect=/ICD10 or on the 

CDC’s Web site at www.cdc.gov/nchs/

data/icd10/10cmguidelines2012.pdf. 

Every year, changes to the ICD–10– 

CM and the ICD–10–PCS coding system 

will be addressed in the IPPS proposed 

and final rules. The changes to the 

codes are effective October 1 of each 

year and must be used by acute care 

hospitals as well as other providers to 

report diagnostic and procedure 

information. The IPF PPS has always 

incorporated ICD–9–CM coding changes 

made in the annual IPPS update and 

will continue to do so for the ICD–10– 

CM and ICD–10–PCS coding changes. 

We will continue to publish coding 

changes in a Transmittal/Change 

Request, similar to how coding changes 

are announced by the IPPS and LTCH 

PPS. The coding changes relevant to the 

IPF PPS are also published in the IPF 

PPS proposed and final rules, or in IPF 

PPS update notices. In 42 CFR 

412.428(e), we indicate that CMS will 

publish information pertaining to the 

annual update for the IPF PPS, which 

includes describing the ICD–9–CM 

coding changes and DRG classification 

changes discussed in the annual update 

to the hospital IPPS regulations. We are 

proposing to update 42 CFR 412.428(e) 

to indicate that we will describe the 

ICD–10–CM coding changes and DRG 

classification changes discussed in the 

annual update to the hospital IPPS 

regulations when ICD–10–CM/PCS 

becomes the required medical data code 

set for use on Medicare claims. 

The ICD–9–CM/PCS coding changes 

are reflected in the FY 2015 GROUPER, 

Version 32.0, effective for IPPS 

discharges occurring on or after October 

1, 2014 through September 30, 2015. 

The GROUPER Version 32.0 software 

package assigns each case to an MS– 

DRG on the basis of the diagnosis and 

procedure codes and demographic 

information (that is, age, sex, and 

discharge status). The Medicare Code 

Editor (MCE) version 32.0 has also been 

converted to use ICD–9–CM/PCS codes 

for IPPS discharges on or after October 

1, 2014. For additional information on 

the GROUPER version 32.0 and the MCE 

32.0 see Transmittal-XXXX dated 

XXXX. 

The IPF PPS has always used the 

same GROUPER and MCE as the IPPS. 

We have posted a Definitions Manual of 

the ICD–10 MS–DRGs Version 31.0–R 

(an updated ICD–10 MS–DRGs version 

31.0) on the ICD–10 MS–DRG 

Conversion Project Web site at: http:// 

www.cms.hhs.gov/Medicare/Coding/

ICD10/ICD-10-MS-DRG-ConversionProject.html. We also prepared a 

document that describes changes made 

from Version 31.0 to Version 31.0–R. 

We will continue to share ICD–10–MS– 

DRG conversion activities with the 

public through this Web site. 

The MS–DRGs were converted so that 

the MS–DRG assignment logic uses 

ICD–10–CM/PCS codes directly. When a 

provider submits a claim for discharges, 

the ICD–10–CM/PCS diagnosis and 

procedure codes will be assigned to the 

correct MS–DRG. The MS–DRGs were 

converted with a single overarching 

goal: that MS–DRG assignment for a 

given patient record is the same after 

ICD–10–CM implementation as it would 

be if the same record had been coded in 

ICD–9–CM and submitted prior to ICD– 

10–CM/PCS implementation. This goal 

is referred to as replication, and every 

effort was made to achieve this goal. 

The General Equivalence Mappings 

(GEMs) were used to assist in converting 

the ICD–9–CM-based MS–DRGs to ICD– 

10–CM/PCS. The majority of ICD–9–CM 

codes (greater than 80 percent) have 

straightforward translation alternative(s) 

in ICD–10–CM/PCS, where the 

diagnoses or procedures classified to a 

given ICD–9–CM code are replaced by a 

number of (typically more specific) 

ICD–10–CM/PCS codes and assigned to 

the same MS–DRG as the ICD–9–CM 

code they are replacing. Further 

information on the assessment of ICD– 

10–CM/PCS MS–DRGs and financial 

impact can be found on the CMS ICD– 

10 Web site at: http://www.cms.hhs.gov/ 

Medicare/Coding/ICD10/ICD-10-MSDRG-Conversion-Project.html. 

Questions concerning the MS–DRGs 

should be directed to Patricia E. Brooks, 

Co-Chairperson, ICD–10–CM 

Coordination and Maintenance 

Committee, CMS, Center for Medicare 

Management, Hospital and Ambulatory 

Policy Group, Division of Acute Care, 

patricia.brooks2@cms.hhs.gov, Mailstop 

C4–08–06, 7500 Security Boulevard, 

Baltimore, Maryland 21244–1850. 

Use of the General Equivalence 

Mappings To Assist in Direct 

Conversion 

For the FY 2015 update, we are not 

making changes to the MS–IPF–DRG 

adjustment factors. That is, we do not 

intend to re-run the regression analysis 

to update the 17 IPF MS–DRG 

adjustment factors. The General 

Equivalence Mappings (GEMs) were 

used to assist in converting the ICD–9– 

CM-based MS–DRGs to ICD–10–CM/

PCS. For this update, we are proposing 

the ICD–10–CM/PCS codes that would 

be used for the MS–DRG payment 

adjustment. Further information for the 

ICD–10–CM/PCS MS–DRG conversion 

project can be found on the CMS ICD– 

10–CM Web site at http://

www.cms.hhs.gov/Medicare/Coding/

ICD10/ICD-10-MS-DRG-ConversionProject.html. 

We are proposing that the MS–IPF– 

DRG adjustment factors (as shown in 

Table 2) would continue to be paid for 

discharges occurring in FY 2015. The 

MS–IPF–DRG adjustment factors would 

be updated on October 1, 2014, using 

the ICD–9–CM/PCS code set. We are 

also proposing the conversion of ICD–9– 

CM/PCS codes to ICD–10–CM/PCS 

codes for the IPF PPS in this proposed 

rule but in light of PAMA, the effective 

date of those changes would be the date 


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when ICD–10–CM/PCS becomes the required medical data code set for use 

on Medicare claims. 

TABLE 2—PROPOSED FY 2015 CURRENT MS–IPF–DRGS APPLICABLE FOR THE PRINCIPAL DIAGNOSIS ADJUSTMENT

MS–DRG MS–DRG descriptions Adjustment 

factor 

056 ................................. Degenerative nervous system disorders w MCC ................................................................................... 1.05 

057 ................................. Degenerative nervous system disorders w/o MCC ................................................................................ 1.05 

080 ................................. Nontraumatic stupor & coma w MCC ..................................................................................................... 1.07 

081 ................................. Nontraumatic stupor & coma w/o MCC .................................................................................................. 1.07 

876 ................................. O.R. Procedure w principal diagnoses of mental illness ........................................................................ 1.22 

880 ................................. Acute adjustment reaction & psychosocial dysfunction .......................................................................... 1.05 

881 ................................. Depressive neuroses .............................................................................................................................. 0.99 

882 ................................. Neuroses except depressive ................................................................................................................... 1.02 

883 ................................. Disorders of personality & impulse control ............................................................................................. 1.02 

884 ................................. Organic disturbances & mental retardation ............................................................................................ 1.03 

885 ................................. Psychoses ............................................................................................................................................... 1.00 

886 ................................. Behavioral & developmental disorders ................................................................................................... 0.99 

887 ................................. Other mental disorder diagnoses ............................................................................................................ 0.92 

894 ................................. Alcohol/drug abuse or dependence, left AMA ........................................................................................ 0.97 

895 ................................. Alcohol/drug abuse or dependence w rehabilitation therapy ................................................................. 1.02 

896 ................................. Alcohol/drug abuse or dependence w/o rehabilitation therapy w MCC ................................................. 0.88 

897 ................................. Alcohol/drug abuse or dependence w/o rehabilitation therapy w/o MCC .............................................. 0.88 

2. Proposed Payment for Comorbid 

Conditions 

The intent of the comorbidity 

adjustments is to recognize the 

increased costs associated with 

comorbid conditions by providing 

additional payments for certain 

concurrent medical or psychiatric 

conditions that are expensive to treat. In 

the May 2011 IPF PPS final rule (76 FR 

26451 through 26452), we explained 

that the IPF PPS includes 17 

comorbidity categories and identified 

the new, revised, and deleted ICD–9– 

CM diagnosis codes that generate a 

comorbid condition payment 

adjustment under the IPF PPS for RY 

2012 (76 FR 26451). 

Comorbidities are specific patient 

conditions that are secondary to the 

patient’s principal diagnosis and that 

require treatment during the stay. 

Diagnoses that relate to an earlier 

episode of care and have no bearing on 

the current hospital stay are excluded 

and must not be reported on IPF claims. 

Comorbid conditions must exist at the 

time of admission or develop 

subsequently, and affect the treatment 

received, length of stay (LOS), or both 

treatment and LOS. 

For each claim, an IPF may receive 

only one comorbidity adjustment within 

a comorbidity category, but it may 

receive an adjustment for more than one 

comorbidity category. Current billing 

instructions require IPFs to enter the 

full, that is, the complete ICD–9–CM 

codes for up to 24 additional diagnoses 

if they co-exist at the time of admission 

or develop subsequently and impact the 

treatment provided. Billing instructions 

will require that IPFs enter the full ICD– 

10–CM/PCS codes. The effective date of 

this change would be the date when 

ICD–10–CM/PCS becomes the required 

medical data code set for use on 

Medicare claims. 

The comorbidity adjustments were 

determined based on the regression 

analysis using the diagnoses reported by 

IPFs in FY 2002. The principal 

diagnoses were used to establish the 

DRG adjustments and were not 

accounted for in establishing the 

comorbidity category adjustments, 

except where ICD–9–CM ‘‘code first’’ 

instructions apply. As we explained in 

the May 2011 IPF PPS final rule (76 FR 

265451), the ‘‘code first’’ rule applies 

when a condition has both an 

underlying etiology and a manifestation 

due to the underlying etiology. For these 

conditions, ICD–9–CM has a coding 

convention that requires the underlying 

conditions to be sequenced first 

followed by the manifestation. 

Whenever a combination exists, there is 

a ‘‘use additional code’’ note at the 

etiology code and a ‘‘code first’’ note at 

the manifestation code. 

The same principle holds for ICD–10– 

CM as for ICD–9–CM. Whenever a 

combination exists, there is a ‘‘use 

additional code’’ note in the ICD–10– 

CM codebook pertaining to the etiology 

code, and a ‘‘code first’’ code pertaining 

to the manifestation code. We provide a 

‘‘code first’’ table in Addendum C of 

this proposed rule for reference that 

highlights the same or similar 

manifestation codes where the ‘‘code 

first’’ instructions apply in ICD–10–CM 

that were present in ICD–9–CM. In the 

‘‘code first’’ table, pertaining to ICD–10– 

CM codes F02.80, F02.81 and F05, 

where individual examples of possible 

etiologies are listed in the codebook, in 

the interest of inclusiveness, all ICD– 

10–CM examples are included in 

addition to the comparable ICD–10–CM 

translations of examples listed in the 

ICD–9–CM codebook for the same 

manifestations. Also, in the interest of 

inclusiveness, an ICD–10–CM 

manifestation code F45.42 ‘‘Pain 

disorder with related psychological 

factors’’, is included in the IPF PPS 

‘‘code first’’ table even though it 

contains a ‘‘code also’’ instruction rather 

than a ‘‘code first’’ instruction, but is 

included in this version of the table for 

information purposes only. The 

proposed list of ICD–10–CM codes that 

we identified as ‘‘code first’’ can be 

located in Addendum C in this 

proposed rule. 

As discussed in the MS–DRG section, 

it is our policy to maintain the same 

diagnostic coding set for IPFs that is 

used under the IPPS for providing the 

same psychiatric care. The 17 

comorbidity categories formerly defined 

using ICD–9–CM codes have been 

converted to ICD–10–CM/PCS. The goal 

for converting the comorbidity 

categories is referred to as replication, 

meaning that the payment adjustment 

for a given patient encounter is the same 

after ICD–10–CM implementation as it 

would be if the same record had been 

coded in ICD–9–CM and submitted 

prior to ICD–10–CM/PCS 

implementation. All conversion efforts 

were made with the intent of achieving 

this goal. The effective date of this 

change would be the date when ICD– 

10–CM/PCS becomes the required 


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Federal Register / Vol. 79, No. 87 / Tuesday, May 6, 2014 / Proposed Rules 26049 

medical data code set for use on 

Medicare claims. 

Direct Conversion of Comorbidity 

Categories 

We converted the ICD–9–CM codes 

for the IPF PPS Comorbidity Payment 

Adjustment Categories to ICD–10–CM/

PCS codes. When an IPF submits a 

claim for discharges the ICD–10–CM/

PCS codes would be assigned to the 

correct comorbidity categories. The 

same method of direct conversion to 

ICD–10–CM/PCS for replication of ICD– 

9–CM based payment applications has 

been implemented by policy groups 

throughout CMS to convert applications 

to ICD–10–CM/PCS, including the MS– 

DRGs. 

Use of the General Equivalence 

Mappings To Assist in Direct 

Conversion 

As with the other policy groups 

mentioned above, the General 

Equivalence Mappings (GEMs) were 

used to assist in converting ICD–9–CMbased applications to ICD–10–CM/PCS. 

Further information concerning the 

GEMs can be found on the CMS ICD–10 

Web site at: http://www.cms.gov/

Medicare/Coding/ICD10/2014-ICD-10- 

CM-and-GEMs.html. 

The majority of ICD–9–CM codes 

(greater than 80 percent) have 

straightforward translation alternative(s) 

in ICD–10–CM/PCS, where the 

diagnoses or procedures classified to a 

given ICD–9–CM code are replaced by a 

number of possibly more specific ICD– 

10–CM/PCS codes, and those ICD–10– 

CM/PCS codes capture the intent of the 

payment policy. 

In rare instances, ICD–10–CM has 

discontinued an area of detail in the 

classification. For example, this is the 

case with the concept of ‘‘malignant 

hypertension’’ in the Cardiac Conditions 

comorbidity category. Malignant 

hypertension is no longer classified 

separately in codes that specify heart 

failure, such as ICD–9–CM code 404.03 

Hypertensive heart and chronic kidney 

disease, malignant, with heart failure 

and with chronic kidney disease stage V 

or end-stage renal disease. This code, in 

the Cardiac Conditions comorbidity 

category, has no corresponding code in 

the ICD–10–CM Cardiac Conditions 

comorbidity category. Instead, all subtypes of hypertension in the presence of 

heart disease or chronic kidney disease 

are classified to a single code in ICD– 

10–CM that specifies the level of heart 

and kidney function, such as I13.2 

Hypertensive heart and chronic kidney 

disease with heart failure and with stage 

5 chronic kidney disease, or end stage 

renal disease. Discussed below are the 

comorbidity categories where the 

crosswalk between ICD–9–CM and ICD– 

10–CM diagnosis codes is less than 

straightforward. For instance, in some 

cases, the use of combination codes in 

one code set is represented as two 

separate codes in the other code set. 

Conversion of Gangrene and 

Uncontrolled Diabetes Mellitus With or 

Without Complications Comorbidity 

Categories 

In the Gangrene comorbidity category, 

there are new ICD–10–CM combination 

codes not present in ICD–9–CM. 

Therefore, we are proposing to include 

many more ICD–10–CM codes in the 

comorbidity definitions than were 

included using ICD–9–CM codes so that 

the comorbidity category using ICD–10– 

CM codes is a complete and accurate 

replication of the category using ICD–9– 

CM codes. 

The ICD–9–CM version of the 

comorbidity category Uncontrolled 

Diabetes Mellitus With or Without 

Complications contains combination 

codes with extra information that is not 

relevant to the clinical intent of the 

category. All patients with uncontrolled 

diabetes are eligible for the payment 

adjustment, regardless of whether they 

have additional diabetic complications. 

The diagnosis of uncontrolled diabetes 

is coded separately in ICD–10–CM. As 

a result, only two ICD–10–CM codes are 

needed to achieve complete and 

accurate replication of the comorbidity 

category definition using ICD–9–CM 

codes. 

Conversion of the Gangrene 

Comorbidity Category 

Currently, two ICD–9–CM codes are 

used for the Gangrene comorbidity 

category: 440.24 Atherosclerosis of 

native arteries of the extremities with 

gangrene and 785.4 Gangrene. 

The first code, 440.24, is a 

combination code and specifies patients 

with underlying peripheral vascular 

disease and a current acute 

manifestation of gangrene. This is the 

only ICD–9–CM combination code that 

specifies gangrene in addition to the 

underlying cause. Also, a number of 

ICD–10–CM codes exist for gangrene 

and they are all included in the ICD–10– 

CM comorbidity category. The ICD–10– 

CM codes specify anatomic site in more 

detail. An example is given below: 

• I70.261 Atherosclerosis of native 

arteries of extremities with gangrene, 

right leg 

• I70.262 Atherosclerosis of native 

arteries of extremities with gangrene, 

left leg 

• I70.263 Atherosclerosis of native 

arteries of extremities with gangrene, 

bilateral legs 

• I70.268 Atherosclerosis of native 

arteries of extremities with gangrene, 

other extremity 

In addition, many ICD–10–CM codes 

specify gangrene in combination with 

diabetes. We propose to include these 

codes in the comorbidity category to 

ensure that a patient with diabetes 

complicated by gangrene receives the 

same payment adjustment for the 

condition when it is coded in ICD–10 as 

if it had been coded in ICD–9–CM. 

Conversion of the Uncontrolled Diabetes 

Mellitus With or Without Complications 

Comorbidity Category 

Where ICD–9–CM uses combination 

codes for uncontrolled diabetes, ICD– 

10–CM classifies diabetes that is out of 

control in a separate, standalone code. 

Unlike ICD–9–CM, ICD–10–CM does not 

have additional codes that specify out of 

control diabetes in combination with a 

complication such as, for example, 

diabetic chronic kidney disease. The 

result is that the comorbidity category 

Uncontrolled Diabetes Mellitus With or 

Without Complications is simpler to 

define using ICD–10–CM codes than 

ICD–9–CM codes. 

ICD–10–CM has changed the 

classification of a diagnosis of 

uncontrolled diabetes in two ways that 

affect conversion of the Uncontrolled 

Diabetes comorbidity category: 

1. ICD–10–CM no longer uses the term 

‘‘uncontrolled’’ in reference to diabetes. 

2. ICD–10–CM classifies diabetes that 

is poorly controlled in a separate, 

standalone code. 

ICD–10–CM does not use the term 

‘‘uncontrolled’’ in codes that classify 

diabetes patients. Instead, ICD–10–CM 

codes specify diabetes ‘‘with 

hyperglycemia’’ as the new terminology 

for classifying patients whose diabetes 

is ‘‘poorly controlled’’ or ‘‘inadequately 

controlled’’ or ‘‘out of control.’’ We 

believe these are appropriate codes to 

capture the intent of the Uncontrolled 

Diabetes comorbidity category. 

Therefore, to ensure that all patients 

who qualified for the Uncontrolled 

Diabetes comorbidity payment 

adjustment using ICD–9–CM codes will 

also qualify for the payment adjustment 

using ICD–10–CM codes, we propose 

that two ICD–10–CM codes specifying 

diabetes with hyperglycemia will be 

used for the payment adjustment for 

Uncontrolled Diabetes Mellitus With or 

Without Complications: E10.65 Type 1 

diabetes mellitus with hyperglycemia, 

and E11.65 Type 2 diabetes mellitus 

with hyperglycemia. 


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26050 Federal Register / Vol. 79, No. 87 / Tuesday, May 6, 2014 / Proposed Rules 

Other Differences Between ICD–9–CM 

and ICD–10–CM Affecting Conversion 

of Comorbidity Categories 

Two other comorbidity categories in 

the IPF PPS required careful review and 

additional formatting of the 

corresponding ICD–10–CM codes in 

order to replicate the clinical intent of 

the comorbidity category. In the Drug 

and/or Alcohol Induced Mental 

Disorders comorbidity category and the 

Poisoning comorbidity category, 

significant structural changes in the way 

that comparable codes are classified in 

ICD–10–CM made it more difficult to 

list the diagnoses in ICD–10–CM code 

ranges, as was possible in ICD–9–CM. 

Because comparable codes are not 

classified contiguously in the ICD–10– 

CM classification scheme, the resulting 

proposed list of codes for this 

comorbidity category is much longer 

than the comorbidity category using 

ICD–9–CM codes. 

Conversion of the Drug and/or Alcohol 

Induced Mental Disorders Comorbidity 

Category 

ICD–10–CM has changed the 

classification of applicable conditions in 

two ways that affect conversion of the 

Drug and/or Alcohol Induced Mental 

Disorders comorbidity category: 

1. ICD–10–CM does not use the term 

‘‘pathological’’ in reference to drug or 

alcohol intoxication, rather it only uses 

the phrase ‘‘with intoxication.’’ 

2. ICD–10–CM contains separate, 

detailed codes for specific drug-induced 

manifestations of mental disorder. ICD– 

10–CM codes specify the particular drug 

and whether the pattern of use is 

documented as use, abuse, or 

dependence. 

First, this comorbidity category 

currently contains ICD–9–CM code 

292.2 Pathological drug intoxication. To 

ensure that all patients who qualified 

for the comorbidity payment adjustment 

under ICD–9–CM code 292.2 will also 

qualify under the ICD–10–CM version of 

the same comorbidity category, we 

propose that the 89 ICD–10–CM codes 

specifying ‘‘with intoxication’’ qualify 

for the payment adjustment. An 

example of the ICD–10–CM codes for a 

diagnosis of cocaine abuse with current 

intoxication is provided below. All of 

these codes would be eligible for the 

payment adjustment. 

• F14.120 Cocaine abuse with 

intoxication, uncomplicated 

• F14.121 Cocaine abuse with 

intoxication with delirium 

• F14.122 Cocaine abuse with 

intoxication with perceptual 

disturbance 

• F14.129 Cocaine abuse with 

intoxication, unspecified 

Next, ICD–10–CM contains separate, 

detailed codes by drug for specific druginduced manifestations of mental 

disorder, such as drug-induced 

psychotic disorder with hallucinations. 

What was a single code in ICD–9–CM, 

292.12 Drug-induced psychotic disorder 

with hallucinations, maps to 24 

comparable codes in ICD–10–CM. We 

propose to include all of these more 

specific ICD–10–CM codes in the 

comorbidity category. We believe they 

are necessary for replication of the 

clinical intent of the comorbidity 

category so that all patients with a druginduced psychotic disorder with 

hallucinations coded on the claim are 

eligible for the payment adjustment. 

Because the ICD–10–CM codes are not 

listed contiguously in the classification, 

they cannot be formatted as a range of 

codes and therefore must be listed as 

single codes in the comorbidity category 

definition. 

The situation described above is 

similar for ICD–9–CM code 292.0 Drug 

withdrawal. ICD–10–CM contains 

separate, detailed codes by drug 

specifying that the patient is in 

withdrawal. We propose to include all 

of these more specific ICD–10–CM 

codes in the comorbidity category. We 

believe they are necessary for 

replication of the clinical intent of the 

comorbidity category, so that all 

patients with a drug withdrawal code on 

the claim are eligible for the payment 

adjustment. Likewise, because the ICD– 

10–CM drug withdrawal codes are not 

listed contiguously in the classification, 

they cannot be formatted as a range of 

codes and so must be listed as single 

codes in the comorbidity category 

definition. 

Conversion of the Poisoning 

Comorbidity Category 

In ICD–10–CM, the Injury and 

Poisoning chapter has added an axis of 

classification for every injury or 

poisoning diagnosis code, which 

specifies additional information about 

the current encounter. This creates three 

unique codes for each injury or 

poisoning diagnosis, marked by a 

different letter in the seventh character 

of the code: 

1. The seventh character ‘‘A’’ in the 

code indicates that the poisoning is a 

current diagnosis in its ‘‘acute phase.’’ 

2. The seventh character ‘‘D’’ in the 

code indicates that the poisoning is no 

longer in its ‘‘acute phase,’’ but that the 

patient is receiving aftercare for the 

earlier poisoning. 

3. The seventh character ‘‘S’’ in the 

code indicates that the patient no longer 

requires care for any aspect of the 

poisoning itself, but that the patient is 

receiving care for a late effect of the 

poisoning. 

The intent of the Poisoning 

comorbidity category is to include only 

those patients with a current diagnosis 

of poisoning. If the intent had been to 

include patients requiring only aftercare 

for an earlier, resolved case of 

poisoning, or for care associated with 

late effects of poisoning that occurred 

sometime in the past, the comorbidity 

category would have included ICD–9– 

CM aftercare codes or late effect codes, 

but it does not. Only acute poisoning 

codes from the ICD–9–CM classification 

are included. Therefore, we propose that 

the Poisoning comorbidity category only 

includes ICD–10–CM poisoning codes 

with a seventh character extension ‘‘A,’’ 

to indicate that the poisoning is 

documented as a current diagnosis. 

In addition, ICD–10–CM poisoning 

codes specify the circumstances of the 

poisoning, whether documented as 

accidental, self-harm, assault, or 

undetermined, as shown in the heroin 

poisoning example below. We propose 

to include all of these more specific 

ICD–10–CM codes in the comorbidity 

category for replication of the clinical 

intent of the comorbidity category so 

that all patients with a current diagnosis 

of poisoning coded on the claim would 

be eligible for the payment adjustment, 

as shown in the heroin poisoning 

example below: 

• T40.1X1A Poisoning by heroin, 

accidental (unintentional), initial 

encounter 

• T40.1X2A Poisoning by heroin, 

intentional self-harm, initial 

encounter 

• T40.1X3A Poisoning by heroin, 

assault, initial encounter 

• T40.1X4A Poisoning by heroin, 

undetermined, initial encounter 

ICD–10–CM classifies poisoning by 

substance, alongside separate codes for 

adverse effect or underdosing of the 

same substance. Because the poisoning 

codes are not listed contiguously in the 

classification, they cannot be formatted 

as a range of codes and therefore must 

be listed as single codes in the 

comorbidity category definition. 

Proposed Elimination of Codes for 

Nonspecific Conditions Based on Side 

of the Body (Laterality) 

We believe that highly descriptive 

coding provides the best and clearest 

way to document a patient’s condition 

and the appropriateness of the 

admission and treatment in an IPF. 

Therefore, whenever possible, we 

believe that the most specific code that 

describes a medical disease, condition, 

or injury should be used to document 


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Federal Register / Vol. 79, No. 87 / Tuesday, May 6, 2014 / Proposed Rules 26051 

the patient’s diagnoses. Generally, 

‘‘unspecified’’ codes are used when they 

most accurately reflect what is known 

about the patient’s condition at the time 

of that particular encounter (for 

example, there is a lack of information 

about a specific type of organism 

causing an illness). However, site of 

illness at the time of the medical 

encounter is an important determinant 

in assessing a patient’s principal or 

secondary diagnosis. For this reason, we 

believe that specific diagnosis codes 

that narrowly identify anatomical sites 

where disease, injury, or condition exist 

should be used when coding patients’ 

diagnoses whenever these codes are 

available. Furthermore, on the same 

note, we believe that one should also 

code to the highest specificity (use the 

full ICD–10–CM/PCS code). 

In accordance with these principles, 

we propose to remove site unspecified 

codes from the IPF PPS ICD–10–CM/

PCS codes in instances in which more 

specific codes are available as the 

clinician should be able to identify a 

more specific diagnosis based on 

clinical assessment at the medical 

encounter. For example, the initial 

GEMS translation included non-specific 

codes such as ICD–10–CM code C44.111 

‘‘Basal Cell carcinoma of skin of 

unspecified eyelid, including canthus.’’ 

Under our proposal: 

C44.111 Basal Cell Carcinoma of 

skin of unspecified eyelid would not be 

accepted. 

C44.112 Basal Cell Carcinoma of 

skin right eyelid would be accepted. 

C44.119 Basal Cell Carcinoma of 

skin left eyelid would be accepted. 

We are proposing to remove these 

non-specific codes whenever a more 

specific diagnosis could be identified by 

the clinician performing the assessment. 

For the example code C44.111, we are 

proposing to delete this code because 

the clinician should be able to identify 

which eye had the basal cell carcinoma, 

and therefore would report the 

condition using the code that specifies 

the right or left eye. 

We are proposing to remove a total of 

153 ICD–10–CM site unspecified codes 

involving the following comorbidity 

categories: Oncology -93 ICD–10–CM 

codes, Gangrene-6 ICD–10–CM codes 

and Severe Musculoskeletal and 

Connective Tissue—54 ICD–10–CM 

codes. The site unspecified IPF PPS 

ICD–10–CM codes that we are proposing 

to remove are listed below in Tables 3 

through 5. 

TABLE 3—PROPOSED SITE UNSPECIFIED ICD–10–CM CODES TO BE REMOVED FROM THE ONCOLOGY TREATMENT

COMORBIDITY CATEGORY

ICD–10–CM 

Diagnosis Code title 

C40.00 .............. Malignant neoplasm of scapula and long bones of unspecified upper limb. 

C40.10 .............. Malignant neoplasm of short bones of unspecified upper limb. 

C40.20 .............. Malignant neoplasm of long bones of unspecified lower limb. 

C40.30 .............. Malignant neoplasm of short bones of unspecified lower limb. 

C40.80 .............. Malignant neoplasm of overlapping sites of bone and articular cartilage of unspecified limb. 

C40.90 .............. Malignant neoplasm of unspecified bones and articular cartilage of unspecified limb. 

C43.10 .............. Malignant melanoma of unspecified eyelid, including canthus. 

C43.20 .............. Malignant melanoma of unspecified ear and external auricular canal. 

C43.60 .............. Malignant melanoma of unspecified upper limb, including shoulder. 

C43.70 .............. Malignant melanoma of unspecified lower limb, including hip. 

C44.101 ............ Unspecified malignant neoplasm of skin of unspecified eyelid, including canthus. 

C44.111 ............ Basal cell carcinoma of skin of unspecified eyelid, including canthus. 

C44.121 ............ Squamous cell carcinoma of skin of unspecified eyelid, including canthus. 

C44.191 ............ Other specified malignant neoplasm of skin of unspecified eyelid, including canthus. 

C44.201 ............ Unspecified malignant neoplasm of skin of unspecified ear and external auricular canal. 

C44.211 ............ Basal cell carcinoma of skin of unspecified ear and external auricular canal. 

C44.221 ............ Squamous cell carcinoma of skin of unspecified ear and external auricular canal. 

C44.601 ............ Unspecified malignant neoplasm of skin of unspecified upper limb, including shoulder. 

C44.611 ............ Basal cell carcinoma of skin of unspecified upper limb, including shoulder. 

C44.621 ............ Squamous cell carcinoma of skin of unspecified upper limb, including shoulder. 

C44.691 ............ Other specified malignant neoplasm of skin of unspecified upper limb, including shoulder. 

C44.701 ............ Unspecified malignant neoplasm of skin of unspecified lower limb, including hip. 

C44.711 ............ Basal cell carcinoma of skin of unspecified lower limb, including hip. 

C44.721 ............ Squamous cell carcinoma of skin of unspecified lower limb, including hip. 

C44.791 ............ Other specified malignant neoplasm of skin of unspecified lower limb, including hip. 

C47.10 .............. Malignant neoplasm of peripheral nerves of unspecified upper limb, including shoulder. 

C47.20 .............. Malignant neoplasm of peripheral nerves of unspecified lower limb, including hip. 

C49.10 .............. Malignant neoplasm of connective and soft tissue of unspecified upper limb, including shoulder. 

C49.20 .............. Malignant neoplasm of connective and soft tissue of unspecified lower limb, including hip. 

C4A.10 .............. Merkel cell carcinoma of unspecified eyelid, including canthus. 

C4A.20 .............. Merkel cell carcinoma of unspecified ear and external auricular canal. 

C4A.60 .............. Merkel cell carcinoma of unspecified upper limb, including shoulder. 

C4A.70 .............. Merkel cell carcinoma of unspecified lower limb, including hip. 

C50.019 ............ Malignant neoplasm of nipple and areola, unspecified female breast. 

C50.029 ............ Malignant neoplasm of nipple and areola, unspecified male breast. 

C50.119 ............ Malignant neoplasm of central portion of unspecified female breast. 

C50.129 ............ Malignant neoplasm of central portion of unspecified male breast. 

C50.219 ............ Malignant neoplasm of upper-inner quadrant of unspecified female breast. 

C50.229 ............ Malignant neoplasm of upper-inner quadrant of unspecified male breast. 

C50.319 ............ Malignant neoplasm of lower-inner quadrant of unspecified female breast. 

C50.329 ............ Malignant neoplasm of lower-inner quadrant of unspecified male breast. 

C50.419 ............ Malignant neoplasm of upper-outer quadrant of unspecified female breast. 

C50.429 ............ Malignant neoplasm of upper-outer quadrant of unspecified male breast. 

C50.519 ............ Malignant neoplasm of lower-outer quadrant of unspecified female breast. 

C50.529 ............ Malignant neoplasm of lower-outer quadrant of unspecified male breast. 


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26052 Federal Register / Vol. 79, No. 87 / Tuesday, May 6, 2014 / Proposed Rules 

TABLE 3—PROPOSED SITE UNSPECIFIED ICD–10–CM CODES TO BE REMOVED FROM THE ONCOLOGY TREATMENT

COMORBIDITY CATEGORY—Continued 

ICD–10–CM 

Diagnosis Code title 

C50.619 ............ Malignant neoplasm of axillary tail of unspecified female breast. 

C50.629 ............ Malignant neoplasm of axillary tail of unspecified male breast. 

C50.819 ............ Malignant neoplasm of overlapping sites of unspecified female breast. 

C50.829 ............ Malignant neoplasm of overlapping sites of unspecified male breast. 

C50.919 ............ Malignant neoplasm of unspecified site of unspecified female breast. 

C50.929 ............ Malignant neoplasm of unspecified site of unspecified male breast. 

C69.00 .............. Malignant neoplasm of unspecified conjunctiva. 

C69.10 .............. Malignant neoplasm of unspecified cornea. 

C69.50 .............. Malignant neoplasm of unspecified lacrimal gland and duct. 

C69.60 .............. Malignant neoplasm of unspecified orbit. 

C69.80 .............. Malignant neoplasm of overlapping sites of unspecified eye and adnexa. 

C69.90 .............. Malignant neoplasm of unspecified site of unspecified eye. 

C76.40 .............. Malignant neoplasm of unspecified upper limb. 

C76.50 .............. Malignant neoplasm of unspecified lower limb. 

D03.10 .............. Melanoma in situ of unspecified eyelid, including canthus. 

D03.20 .............. Melanoma in situ of unspecified ear and external auricular canal. 

D03.60 .............. Melanoma in situ of unspecified upper limb, including shoulder. 

D03.70 .............. Melanoma in situ of unspecified lower limb, including hip. 

D04.10 .............. Carcinoma in situ of skin of unspecified eyelid, including canthus. 

D04.20 .............. Carcinoma in situ of skin of unspecified ear and external auricular canal. 

D04.60 .............. Carcinoma in situ of skin of unspecified upper limb, including shoulder. 

D04.70 .............. Carcinoma in situ of skin of unspecified lower limb, including hip. 

D05.00 .............. Lobular carcinoma in situ of unspecified breast. 

D05.10 .............. Intraductal carcinoma in situ of unspecified breast. 

D05.80 .............. Other specified type of carcinoma in situ of unspecified breast. 

D05.90 .............. Unspecified type of carcinoma in situ of unspecified breast. 

D09.20 .............. Carcinoma in situ of unspecified eye. 

D16.00 .............. Benign neoplasm of scapula and long bones of unspecified upper limb. 

D16.10 .............. Benign neoplasm of short bones of unspecified upper limb. 

D16.20 .............. Benign neoplasm of long bones of unspecified lower limb. 

D16.30 .............. Benign neoplasm of short bones of unspecified lower limb. 

D17.20 .............. Benign lipomatous neoplasm of skin and subcutaneous tissue of unspecified limb. 

D21.10 .............. Benign neoplasm of connective and other soft tissue of unspecified upper limb, including shoulder. 

D21.20 .............. Benign neoplasm of connective and other soft tissue of unspecified lower limb, including hip. 

D22.10 .............. Melanocytic nevi of unspecified eyelid, including canthus. 

D22.20 .............. Melanocytic nevi of unspecified ear and external auricular canal. 

D22.60 .............. Melanocytic nevi of unspecified upper limb, including shoulder. 

D22.70 .............. Melanocytic nevi of unspecified lower limb, including hip. 

D23.10 .............. Other benign neoplasm of skin of unspecified eyelid, including canthus. 

D23.20 .............. Other benign neoplasm of skin of unspecified ear and external auricular canal. 

D23.60 .............. Other benign neoplasm of skin of unspecified upper limb, including shoulder. 

D23.70 .............. Other benign neoplasm of skin of unspecified lower limb, including hip. 

D24.9 ................ Benign neoplasm of unspecified breast. 

D31.00 .............. Benign neoplasm of unspecified conjunctiva. 

D31.50 .............. Benign neoplasm of unspecified lacrimal gland and duct. 

D31.60 .............. Benign neoplasm of unspecified site of unspecified orbit. 

D31.90 .............. Benign neoplasm of unspecified part of unspecified eye. 

D48.60 .............. Neoplasm of uncertain behavior of unspecified breast. 

TABLE 4—PROPOSED SITE UNSPECIFIED ICD–10–CM CODES TO BE REMOVED FROM THE GANGRENE COMORBIDITY

CATEGORY

ICD10 ICD10 Description 

I70269 ............... Atherosclerosis of native arteries of extremities with gangrene, unspecified extremity. 

I70369 ............... Atherosclerosis of unspecified type of bypass graft(s) of the extremities with gangrene, unspecified extremity. 

I70469 ............... Atherosclerosis of autologous vein bypass graft(s) of the extremities with gangrene, unspecified extremity. 

I70569 ............... Atherosclerosis of nonautologous biological bypass graft(s) of the extremities with gangrene, unspecified extremity. 

I70669 ............... Atherosclerosis of nonbiological bypass graft(s) of the extremities with gangrene, unspecified extremity. 

I70769 ............... Atherosclerosis of other type of bypass graft(s) of the extremities with gangrene, unspecified extremity. 

TABLE 5—PROPOSED SITE UNSPECIFIED ICD–10–CM CODES TO BE REMOVED FROM THE SEVERE MUSCULOSKELETAL

AND CONNECTIVE TISSUE DISEASES CATEGORY

ICD10 ICD10 Description 

M8600 ............... Acute hematogenous osteomyelitis, unspecified site. 

M86019 ............. Acute hematogenous osteomyelitis, unspecified shoulder. 


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TABLE 5—PROPOSED SITE UNSPECIFIED ICD–10–CM CODES TO BE REMOVED FROM THE SEVERE MUSCULOSKELETAL

AND CONNECTIVE TISSUE DISEASES CATEGORY—Continued 

ICD10 ICD10 Description 

M86029 ............. Acute hematogenous osteomyelitis, unspecified humerus. 

M86039 ............. Acute hematogenous osteomyelitis, unspecified radius and ulna. 

M86049 ............. Acute hematogenous osteomyelitis, unspecified hand. 

M86059 ............. Acute hematogenous osteomyelitis, unspecified femur. 

M86069 ............. Acute hematogenous osteomyelitis, unspecified tibia and fibula. 

M86079 ............. Acute hematogenous osteomyelitis, unspecified ankle and foot. 

M8610 ............... Other acute osteomyelitis, unspecified site. 

M86119 ............. Other acute osteomyelitis, unspecified shoulder. 

M86129 ............. Other acute osteomyelitis, unspecified humerus. 

M86139 ............. Other acute osteomyelitis, unspecified radius and ulna. 

M86149 ............. Other acute osteomyelitis, unspecified hand. 

M86159 ............. Other acute osteomyelitis, unspecified femur. 

M86169 ............. Other acute osteomyelitis, unspecified tibia and fibula. 

M86179 ............. Other acute osteomyelitis, unspecified ankle and foot. 

M8620 ............... Subacute osteomyelitis, unspecified site. 

M86219 ............. Subacute osteomyelitis, unspecified shoulder. 

M86229 ............. Subacute osteomyelitis, unspecified humerus. 

M86239 ............. Subacute osteomyelitis, unspecified radius and ulna. 

M86249 ............. Subacute osteomyelitis, unspecified hand. 

M86259 ............. Subacute osteomyelitis, unspecified femur. 

M86269 ............. Subacute osteomyelitis, unspecified tibia and fibula. 

M86279 ............. Subacute osteomyelitis, unspecified ankle and foot. 

M8630 ............... Chronic multifocal osteomyelitis, unspecified site. 

M86319 ............. Chronic multifocal osteomyelitis, unspecified shoulder. 

M86329 ............. Chronic multifocal osteomyelitis, unspecified humerus. 

M86339 ............. Chronic multifocal osteomyelitis, unspecified radius and ulna. 

M86349 ............. Chronic multifocal osteomyelitis, unspecified hand. 

M86359 ............. Chronic multifocal osteomyelitis, unspecified femur. 

M86369 ............. Chronic multifocal osteomyelitis, unspecified tibia and fibula. 

M86379 ............. Chronic multifocal osteomyelitis, unspecified ankle and foot. 

M8640 ............... Chronic osteomyelitis with draining sinus, unspecified site. 

M86419 ............. Chronic osteomyelitis with draining sinus, unspecified shoulder. 

M86429 ............. Chronic osteomyelitis with draining sinus, unspecified humerus. 

M86439 ............. Chronic osteomyelitis with draining sinus, unspecified forearm. 

M86449 ............. Chronic osteomyelitis with draining sinus, unspecified hand. 

M86459 ............. Chronic osteomyelitis with draining sinus, unspecified femur. 

M86469 ............. Chronic osteomyelitis with draining sinus, unspecified lower leg. 

M86479 ............. Chronic osteomyelitis with draining sinus, unspecified ankle and foot. 

M8650 ............... Other chronic hematogenous osteomyelitis, unspecified site. 

M86519 ............. Other chronic hematogenous osteomyelitis, unspecified shoulder. 

M86529 ............. Other chronic hematogenous osteomyelitis, unspecified humerus. 

M86539 ............. Other chronic hematogenous osteomyelitis, unspecified forearm. 

M86549 ............. Other chronic hematogenous osteomyelitis, unspecified hand. 

M86559 ............. Other chronic hematogenous osteomyelitis, unspecified femur. 

M86569 ............. Other chronic hematogenous osteomyelitis, unspecified lower leg. 

M8660 ............... Other chronic osteomyelitis, unspecified site. 

M86619 ............. Other chronic osteomyelitis, unspecified shoulder. 

M86629 ............. Other chronic osteomyelitis, unspecified upper arm. 

M86639 ............. Other chronic osteomyelitis, unspecified forearm. 

M86649 ............. Other chronic osteomyelitis, unspecified hand. 

M86679 ............. Other chronic osteomyelitis, unspecified ankle and foot. 

M868x9 ............. Other osteomyelitis, unspecified sites. 

There are some site unspecified ICD– 

10–CM codes that we are not proposing 

to remove. In the case where the site 

unspecified code is the only available 

ICD–10–CM code, that is when a 

laterality code (site specific code) is not 

available, the site unspecified code will 

not be removed and it would be 

appropriate to submit that code. 

Currently, IPFs are receiving the 

comorbidity adjustment using the ICD– 

9–CM diagnosis codes for the 

comorbidity categories shown in Table 

6 below. 

TABLE 6—FY 2014 CURRENT DIAGNOSIS CODES AND ADJUSTMENT FACTORS FOR COMORBIDITY CATEGORIES

Description of comorbidity ICD–9–CM Diagnoses codes Adjustment 

factor 

Developmental Disabilities ......................... 317, 3180, 3181, 3182, and 319 .................................................................................... 1.04 

Coagulation Factor Deficits ........................ 2860 through 2864 .......................................................................................................... 1.13 

Tracheostomy ............................................. 51900 through 51909 and V440 ..................................................................................... 1.06 


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TABLE 6—FY 2014 CURRENT DIAGNOSIS CODES AND ADJUSTMENT FACTORS FOR COMORBIDITY CATEGORIES— 

Continued 

Description of comorbidity ICD–9–CM Diagnoses codes Adjustment 

factor 

Renal Failure, Acute .................................. 5845 through 5849, 63630, 63631, 63632, 63730, 63731, 63732, 6383, 6393, 66932, 

66934, 9585.

1.11 

Renal Failure, Chronic ............................... 40301, 40311, 40391, 40402, 40412, 40413, 40492, 40493, 5853, 5854, 5855, 5856, 

5859,586, V4511, V4512, V560, V561, and V562.

1.11 

Oncology Treatment ................................... 1400 through 2399 with a radiation therapy code 92.21–92.29 or chemotherapy code 

99.25.

1.07 

Uncontrolled Diabetes-Mellitus with or 

without complications.

25002, 25003, 25012, 25013, 25022, 25023, 25032, 25033, 25042, 25043, 25052, 

25053, 25062, 25063, 25072, 25073, 25082, 25083, 25092, and 25093.

1.05 

Severe Protein Calorie Malnutrition ........... 260 through 262 .............................................................................................................. 1.13 

Eating and Conduct Disorders ................... 3071, 30750, 31203, 31233, and 31234 ........................................................................ 1.12 

Infectious Disease ...................................... 01000 through 04110, 042, 04500 through 05319, 05440 through 05449, 0550 

through 0770, 0782 through 07889, and 07950 through 07959.

1.07 

Drug and/or Alcohol Induced Mental Disorders.2910, 2920, 29212, 2922, 30300, and 30400 ................................................................ 1.03 

Cardiac Conditions ..................................... 3910, 3911, 3912, 40201, 40403, 4160, 4210, 4211, and 4219 ................................... 1.11 

Gangrene ................................................... 44024 and 7854 .............................................................................................................. 1.10 

Chronic Obstructive Pulmonary Disease ... 49121, 4941, 5100, 51883, 51884, V4611, V4612, V4613 and V4614 ......................... 1.12 

Artificial Openings—Digestive and Urinary 56960 through 56969, 9975, and V441 through V446 ................................................... 1.08 

Severe Musculoskeletal and Connective 

Tissue Diseases.

6960, 7100, 73000 through 73009, 73010 through 73019, and 73020 through 73029 1.09 

Poisoning .................................................... 96500 through 96509, 9654, 9670 through 9699, 9770, 9800 through 9809, 9830 

through 9839, 986, 9890 through 9897.

1.11 

For FY 2015, we are proposing to 

apply the 17 comorbidity categories for 

which we provide an adjustment as 

shown in Table 6 above. We are also 

proposing the ICD–10–CM/PCS codes 

and adjustment factors shown in Table 

7 below, as well as, the removal of 153 

site unspecified ICD–10–CM codes in 

Tables 3 through 5 above. However, the 

effective date of those changes would be 

the date when ICD–10–CM/PCS 

becomes the required medical data code 

set for use on Medicare claims. 

TABLE 7—FY 2015 DIAGNOSIS CODES AND ADJUSTMENT FACTORS FOR COMORBIDITY CATEGORIES

Description of comorbidity ICD–10–CM Diagnoses codes Adjustment 

factor 

Developmental Disabilities ......................... F70 through F79 ............................................................................................................. 1.04 

Coagulation Factor Deficits ........................ D66 through D682 .......................................................................................................... 1.13 

Tracheostomy ............................................. J9500 through J9509, and Z930 .................................................................................... 1.06 

Renal Failure, Acute .................................. N170 through N179, O0482, O0732, O084 O904, and T795XXA ................................. 1.11 

Renal Failure, Chronic ............................... I120, I1311 through I132, N183 through N19, Z4901 through Z4931, Z9115, and 

Z992.

1.11 

Oncology Treatment ................................... C000 through C866, C882 through C964, C96A, C96Z, C969 through D471, D473,

D47Z1 through D47Z9, D479 through D499, K317, K635, Q8500, and Q8501 

through Q8509, with a radiation therapy code from ICD–10–PCS tables 08H 

through 0YH with a sixth character device value 1 Radioactive Element, ICD–10– 

PCS table CW7, ICD–10–PCS tables D00 through DW0, ICD–10–PCS tables D01 

through DW1, tables D0Y through DWY, or a chemotherapy code from ICD–10– 

PCS table 3E0 with a sixth character substance value 0 Antineoplastic and a seventh character qualifier 5 Other Antineoplastic.

1.07 

Uncontrolled Diabetes-Mellitus with or 

without complications.

E1065 and E1165 ........................................................................................................... 1.05 

Severe Protein Calorie Malnutrition ........... E40 through E43 ............................................................................................................. 1.13 

Eating and Conduct Disorders ................... F5000 through F5002, F509, F631, F6381, and F911 .................................................. 1.12 

Infectious Disease ...................................... A150 through A269, A280 through A329, A35 through A439, A46 through A480, 

A482 through A488, A491, A70 through A740, A7489, A800 through A99, B0050 

through B0059, B010 through B0229, B03 through B069, B08010 through B0809, 

B0820 through B2799, B330 through B333, B338, B341, B471 through B479, 

B950 through B955, B958, B9730 through B9739, G032, I673, J020, J0300, 

J0301, J202, K9081, L081, L444, M60009, and R1111.

1.07 


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TABLE 7—FY 2015 DIAGNOSIS CODES AND ADJUSTMENT FACTORS FOR COMORBIDITY CATEGORIES—Continued 

Description of comorbidity ICD–10–CM Diagnoses codes Adjustment 

factor 

Drug and/or Alcohol Induced Mental Disorders.Alcohol dependence with intoxication and/or withdrawal F10121, F10220 through 

F10229, F10231, and F10921. Drug withdrawal F1193, F1123, F13230 through 

F13239, F13930 through F13939, F1423, F1523, F1593, F17203, F17213, 

F17223, F17293, F19230 through F19239, and F19930 through F19939. Drug-induced psychotic disorder with hallucinations F11251, F11151, F11951, F12151, 

F12251, F13151, F12951, F13251, F13951, F14151, F14251, F14951, F15151, 

F15251, F15951, F16151, F16251, F16951, F18151, F18251, F18951, F19151, 

F19251, and F19951. Drug intoxication F11220 through F11229, F11920 through 

F11929, F12120 through F12129, F12220 through F12229, F12920 through 

F12929, F13120 through F13129, F13220 through F13229, F13920 through 

F13929, F14120 through F14129, F14220 through F14229, F14920 through 

F14929, F15120 through F15129, F15220 through F15229, F15920 through 

F15929, F16120 through F16129, F16220 through F16229, F16920 through 

F16929, F18120 through F18129, F18220 through F18229, F18920 through 

F18929, F19120 through F19129, F19220 through F19229, F19230 through 

F19239, and F19920 through F19929. Opioid dependence not listed above F1120, 

F1124, F11250, F11259, F11281 through F11288, F1129.

1.03 

Cardiac Conditions ..................................... I010 through I012, I110, I270, I330 through I339, and I39 ............................................ 1.11 

Gangrene ................................................... E0852, E0952, E1052, E1152, E1352, I70261 through I70269, I70361 through 

I70369, I70461 through I70469, I70561 through I70569, I70661 through I70669, 

I70761 through I70769, I7301, and I96.

1.10 

Chronic Obstructive Pulmonary Disease ... J441, J470 through J471, J860, J95850, J9610 through J9622, and Z9911 through 

Z9912.

1.12 

Artificial Openings—Digestive and Urinary K9400 through K9419, N990, N99520 through N99538, N9981, N9989, and Z931 

through Z936.

1.08 

Severe Musculoskeletal and Connective 

Tissue Diseases.

L4050 through L4059, M320 through M329, M4620 through M4628, and M8600 

through M869.

1.09 

Poisoning .................................................... Note: Only includes the codes below with seventh character A specifying initial encounter. T391X1 through T391X4, T400X1 through T400X4, T401X1 through 

T401X4, T402X1 through T402X4, T403X1 through T403X4, T404X1 through 

T404X4, T40601 through T40604, T40691 through T40694, T407X1 through 

T407X4, T408X1 through T408X4, T40901 through T40904, T40991 through 

T40994, T410X1 through T410X4, T411X1 through T411X4, T41201 through 

T41204, T41291 through T41294, T413X1 through T413X4, T4141X through 

T4144X, T423X1 through T423X4, T424X1 through T424X4, T426X1 through 

T426X4, T4271X through T4274X, T428X1 through T428X4, T43011 through 

T43014, T43021 through T43024, T431X1 through T431X4, T43201 through 

T43204, T43211 through T43214, T43221 through T43224, T43291 through 

T43294, T433X1 through T433X4, T434X1 through T434X4, T43501 through 

T43504, T43591 through T43594, T43601 through T43604, T43611 through 

T43614, T43621 through T43624, T43631 through T43634, T43691 through 

T43694, T438X1 through T438X4, T4391X through T4394X, T505X1 through 

T505X4, T510X1 through T5194X, T510X1 through T510X4, T5391X through 

T5394X, T540X1 through T5494X, T550X1 through T551X4, T560X1 through 

T560X4, T571X1 through T571X4, T5801X through T5804X, T5811X through 

T5814X, T582X1 through T582X4, T588X1 through T588X4, T5891X through 

T5894X, T600X1 through T600X4, T601X1 through T601X4, T602X1 through 

T602X4, T6041X through T6094X, T63001 through T6394X, T6401X through 

T6484X, T650X1 through T650X4, T651X1 through T651X4.

1.11 

3. Proposed Patient Age Adjustments 

As explained in the November 2004 

IPF PPS final rule (69 FR 66922), we 

analyzed the impact of age on per diem 

cost by examining the age variable (that 

is, the range of ages) for payment 

adjustments. 

In general, we found that the cost per 

day increases with age. The older age 

groups are more costly than the under 

45 age group, the differences in per 

diem cost increase for each successive 

age group, and the differences are 

statistically significant. 

For FY 2015, we are proposing to 

continue to use the patient age 

adjustments currently in effect as shown 

in Table 8 below. 

TABLE 8—AGE GROUPINGS AND

ADJUSTMENT FACTORS

Age Adjustment 

factor 

Under 45 ................................... 1.00 

45 and under 50 ....................... 1.01 

50 and under 55 ....................... 1.02 

55 and under 60 ....................... 1.04 

60 and under 65 ....................... 1.07 

65 and under 70 ....................... 1.10 

70 and under 75 ....................... 1.13 

75 and under 80 ....................... 1.15 

80 and over .............................. 1.17 

4. Proposed Variable Per Diem 

Adjustments 

We explained in the November 2004 

IPF PPS final rule (69 FR 66946) that the 

regression analysis indicated that per 

diem cost declines as the LOS increases. 

The variable per diem adjustments to 

the Federal per diem base rate account 

for ancillary and administrative costs 

that occur disproportionately in the first 

days after admission to an IPF. 

We used a regression analysis to 

estimate the average differences in per 

diem cost among stays of different 

lengths. As a result of this analysis, we 

established variable per diem 

adjustments that begin on day 1 and 


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decline gradually until day 21 of a 

patient’s stay. For day 22 and thereafter, 

the variable per diem adjustment 

remains the same each day for the 

remainder of the stay. However, the 

adjustment applied to day 1 depends 

upon whether the IPF has a qualifying 

emergency department (ED). If an IPF 

has a qualifying ED, it receives a 1.31 

adjustment factor for day 1 of each stay. 

If an IPF does not have a qualifying ED, 

it receives a 1.19 adjustment factor for 

day 1 of the stay. The ED adjustment is 

explained in more detail in section 

VII.C.5 of this proposed rule. 

For FY 2015, we are proposing to 

continue to use the variable per diem 

adjustment factors currently in effect as 

shown in Table 9 below. A complete 

discussion of the variable per diem 

adjustments appears in the November 

2004 IPF PPS final rule (69 FR 66946). 

TABLE 9—VARIABLE PER DIEM

ADJUSTMENTS

Day-of-stay Adjustment 

factor 

Day 1—IPF Without a Qualifying ED ................................ 1.19 

Day 1—IPF With a Qualifying 

ED ......................................... 1.31 

Day 2 ........................................ 1.12 

Day 3 ........................................ 1.08 

Day 4 ........................................ 1.05 

Day 5 ........................................ 1.04 

Day 6 ........................................ 1.02 

Day 7 ........................................ 1.01 

Day 8 ........................................ 1.01 

Day 9 ........................................ 1.00 

Day 10 ...................................... 1.00 

Day 11 ...................................... 0.99 

Day 12 ...................................... 0.99 

Day 13 ...................................... 0.99 

Day 14 ...................................... 0.99 

Day 15 ...................................... 0.98 

Day 16 ...................................... 0.97 

Day 17 ...................................... 0.97 

Day 18 ...................................... 0.96 

Day 19 ...................................... 0.95 

Day 20 ...................................... 0.95 

Day 21 ...................................... 0.95 

After Day 21 ............................. 0.92 

C. Facility-Level Adjustments 

The IPF PPS includes facility-level 

adjustments for the wage index, IPFs 

located in rural areas, teaching IPFs, 

cost of living adjustments for IPFs 

located in Alaska and Hawaii, and IPFs 

with a qualifying ED. 

1. Proposed Wage Index Adjustment 

a. Background 

As discussed in the May 2006 IPF PPS 

final rule (71 FR 27061) and in the May 

2008 (73 FR 25719) and May 2009 IPF 

PPS notices (74 FR 20373), in order to 

provide an adjustment for geographic 

wage levels, the labor-related portion of 

an IPF’s payment is adjusted using an 

appropriate wage index. Currently, an 

IPF’s geographic wage index value is 

determined based on the actual location 

of the IPF in an urban or rural area as 

defined in § 412.64(b)(1)(ii)(A) and (C). 

b. Proposed Wage Index for FY 2015 

Since the inception of the IPF PPS, we 

have used the pre-reclassified, pre-floor 

hospital wage index in developing a 

wage index to be applied to IPFs 

because there is not an IPF-specific 

wage index available and we believe 

that IPFs generally compete in the same 

labor market as acute care hospitals so 

the pre-reclassified, pre-floor inpatient 

acute care hospital wage index should 

be reflective of labor costs of IPFs. As 

discussed in the May 2006 IPF PPS final 

rule for FY 2007 (71 FR 27061 through 

27067), under the IPF PPS, the wage 

index is calculated using the IPPS wage 

index for the labor market area in which 

the IPF is located, without taking into 

account geographic reclassifications, 

floors, and other adjustments made to 

the wage index under the IPPS. For a 

complete description of these IPPS wage 

index adjustments, please see the CY 

2013 IPPS/LTCH PPS final rule (77 FR 

53365 through 53374). We are proposing 

to continue that practice for FY 2015. 

We apply the wage index adjustment 

to the labor-related portion of the 

Federal rate, which is currently 

estimated to be 69.538 percent. This 

percentage reflects the labor-related 

relative importance of the FY 2008- 

based RPL market basket for FY 2015 

(see section V.C. of this proposed rule). 

Changes to the wage index are made 

in a budget-neutral manner so that 

updates do not increase expenditures. 

For FY 2015, we are proposing to apply 

the most recent hospital wage index 

(that is, the FY 2014 pre-floor, prereclassified hospital wage index which 

is the most appropriate index as it best 

reflects the variation in local labor costs 

of IPFs in the various geographic areas) 

using the most recent hospital wage data 

(that is, data from hospital cost reports 

for the cost reporting period beginning 

during FY 2010), and applying an 

adjustment in accordance with our 

budget-neutrality policy. This policy 

requires us to estimate the total amount 

of IPF PPS payments for FY 2014 using 

the labor-related share and the wage 

indices from FY 2014 divided by the 

total estimated IPF PPS payments for FY 

2015 using the labor-related share and 

wage indices from FY 2015. The 

estimated payments are based on FY 

2013 IPF claims, inflated to the 

appropriate FY. This quotient is the 

wage index budget-neutrality factor, and 

it is applied in the update of the Federal 

per diem base rate for FY 2015 in 

addition to the market basket described 

in section VI.B. of this proposed rule. 

The wage index budget-neutrality factor 

for FY 2015 is 1.0003. The wage index 

applicable for FY 2015 appears in Table 

1 and Table 2 in Addendum B of this 

proposed rule. 

In the May 2006 IPF PPS final rule for 

RY 2007 (71 FR 27061–27067), we 

adopted the changes discussed in the 

Office of Management and Budget 

(OMB) Bulletin No. 03–04 (June 6, 

2003), which announced revised 

definitions for Metropolitan Statistical 

Areas (MSAs), and the creation of 

Micropolitan Statistical Areas and 

Combined Statistical Areas. In adopting 

the OMB Core-Based Statistical Area 

(CBSA) geographic designations, we did 

not provide a separate transition for the 

CBSA-based wage index since the IPF 

PPS was already in a transition period 

from TEFRA payments to PPS 

payments. 

As was the case in FY 2014, for FY 

2015, we will continue to use the CBSA 

geographic designations. The updated 

FY 2015 CBSA-based wage index values 

are presented in Tables 1 and 2 in 

Addendum B of this proposed rule. A 

complete discussion of the CBSA labor 

market definitions appears in the May 

2006 IPF PPS final rule (71 FR 27061 

through 27067). 

In keeping with established IPF PPS 

wage index policy, we propose to use 

the FY 2014 pre-floor, pre-reclassified 

hospital wage index (which is based on 

data collected from hospital cost reports 

submitted by hospitals for cost reporting 

periods beginning during FY 2010) to 

adjust IPF PPS payments beginning 

October 1, 2014. 

c. OMB Bulletins 

OMB publishes bulletins regarding 

CBSA changes, including changes to 

CBSA numbers and titles. In the May 

2008 IPF PPS notice, we incorporated 

the CBSA nomenclature changes 

published in the most recent OMB 

bulletin that applies to the hospital 

wage index used to determine the 

current IPF PPS wage index and stated 

that we expect to continue to do the 

same for all the OMB CBSA 

nomenclature changes in future IPF PPS 

rules and notices, as necessary (73 FR 

25721). The OMB bulletins may be 

accessed online at http://

www.whitehouse.gov/omb/bullentins/

index.html. 

In accordance with our established 

methodology, we have historically 

adopted any CBSA changes that are 

published in the OMB bulletin that 

corresponds with the hospital wage 

index used to determine the IPF PPS 


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wage index. For FY 2015, we use the FY 

2014 pre-floor, pre-reclassified hospital 

wage index to adjust the IPF PPS 

payments. On February 28, 2013, OMB 

issued OMB Bulletin No. 13–01, which 

establishes revised delineations of 

statistical areas based on OMB 

standards published in the Federal 

Register on June 28, 2010 and 2010 

Census Bureau data. Because the FY 

2014 pre-floor, pre-reclassified hospital 

wage index was finalized prior to the 

issuance of this Bulletin, the FY 2014 

pre-floor, pre-reclassified hospital wage 

index does not reflect OMB’s new area 

delineations based on the 2010 Census 

and, thus, the FY 2015 IPF PPS wage 

index will not reflect the OMB changes. 

CMS intends to propose changes to 

the hospital wage index based on this 

OMB Bulletin in the FY 2015 IPPS/

LTCH PPS proposed rule, as stated in 

the FY 2014 IPPS/LTCH PPS proposed 

rule (78 FR 27552 through 27553). 

Therefore, we anticipate that the OMB 

Bulletin changes will be reflected in the 

FY 2015 hospital wage index. Because 

we base the IPF PPS wage index on the 

hospital wage index from the prior year, 

we anticipate that the OMB Bulletin 

changes would be reflected in the FY 

2016 IPPS PPS wage index. 

2. Proposed Adjustment for Rural 

Location 

In the November 2004 IPF PPS final 

rule, we provided a 17 percent payment 

adjustment for IPFs located in a rural 

area. This adjustment was based on the 

regression analysis, which indicated 

that the per diem cost of rural facilities 

was 17 percent higher than that of urban 

facilities after accounting for the 

influence of the other variables included 

in the regression. For FY 2015, we are 

proposing to apply a 17 percent 

payment adjustment for IPFs located in 

a rural area as defined at 

§ 412.64(b)(1)(ii)(C). A complete 

discussion of the adjustment for rural 

locations appears in the November 2004 

IPF PPS final rule (69 FR 66954). 

3. Proposed Teaching Adjustment 

In the November 2004 IPF PPS final 

rule, we implemented regulations at 

§ 412.424(d)(1)(iii) to establish a facilitylevel adjustment for IPFs that are, or are 

part of, teaching hospitals. The teaching 

adjustment accounts for the higher 

indirect operating costs experienced by 

hospitals that participate in graduate 

medical education (GME) programs. The 

payment adjustments are made based on 

the ratio of the number of full-time 

equivalent (FTE) interns and residents 

training in the IPF and the IPF’s average 

daily census. 

Medicare makes direct GME payments 

(for direct costs such as resident and 

teaching physician salaries, and other 

direct teaching costs) to all teaching 

hospitals including those paid under a 

PPS, and those paid under the TEFRA 

rate-of-increase limits. These direct 

GME payments are made separately 

from payments for hospital operating 

costs and are not part of the IPF PPS. 

The direct GME payments do not 

address the estimated higher indirect 

operating costs teaching hospitals may 

face. 

The results of the regression analysis 

of FY 2002 IPF data established the 

basis for the payment adjustments 

included in the November 2004 IPF PPS 

final rule. The results showed that the 

indirect teaching cost variable is 

significant in explaining the higher 

costs of IPFs that have teaching 

programs. We calculated the teaching 

adjustment based on the IPF’s ‘‘teaching 

variable,’’ which is one plus the ratio of 

the number of FTE residents training in 

the IPF (subject to limitations described 

below) to the IPF’s average daily census 

(ADC). 

We established the teaching 

adjustment in a manner that limited the 

incentives for IPFs to add FTE residents 

for the purpose of increasing their 

teaching adjustment. We imposed a cap 

on the number of FTE residents that 

may be counted for purposes of 

calculating the teaching adjustment. The 

cap limits the number of FTE residents 

that teaching IPFs may count for the 

purpose of calculating the IPF PPS 

teaching adjustment, not the number of 

residents teaching institutions can hire 

or train. We calculated the number of 

FTE residents that trained in the IPF 

during a ‘‘base year’’ and used that FTE 

resident number as the cap. An IPF’s 

FTE resident cap is ultimately 

determined based on the final 

settlement of the IPF’s most recent cost 

report filed before November 15, 2004 

(that is, the publication date of the IPF 

PPS final rule). 

In the regression analysis, the 

logarithm of the teaching variable had a 

coefficient value of 0.5150. We 

converted this cost effect to a teaching 

payment adjustment by treating the 

regression coefficient as an exponent 

and raising the teaching variable to a 

power equal to the coefficient value. We 

note that the coefficient value of 0.5150 

was based on the regression analysis 

holding all other components of the 

payment system constant. A complete 

discussion of how the teaching 

adjustment was calculated appears in 

the November 2004 IPF PPS final rule 

(69 FR 66954 through 66957) and the 

May 2008 IPF PPS notice (73 FR 25721). 

As with other adjustment factors 

derived through the regression analysis, 

we do not plan to rerun the regression 

analysis until we analyze IPF PPS data. 

Therefore, in this proposed rule, for FY 

2015, we are proposing to retain the 

coefficient value of 0.5150 for the 

teaching adjustment to the Federal per 

diem base rate. 

a. FTE Intern and Resident Cap 

Adjustment 

CMS had been asked by the IPF 

industry to reconsider the original IPF 

teaching policy and permit a temporary 

increase in the FTE resident cap when 

an IPF increases the number of FTE 

residents it trains due to the acceptance 

of displaced residents (residents that are 

training in an IPF or a program before 

the IPF or program closed) when 

another IPF closes or closes its medical 

residency training program. 

To help us assess how many IPFs had 

been, or were expected to be adversely 

affected by their inability to adjust their 

caps under § 412.424(d)(1)(iii) and 

under these situations, we specifically 

requested public comment from IPFs in 

the May 1, 2009 IPF PPS notice (74 FR 

20376 through 20377). A summary of 

the comments and our responses can be 

reviewed in the April 30, 2010 IPF PPS 

notice (75 FR 23106 through 23117). All 

of the commenters recommended that 

CMS modify the IPF PPS teaching 

adjustment policy, supporting a policy 

change that would permit the IPF PPS 

residency cap to be temporarily adjusted 

when that IPF trains displaced residents 

due to closure of an IPF or closure of an 

IPF’s medical residency training 

program(s). The commenters 

recommended a temporary resident cap 

adjustment policy similar to the policies 

applied in similar contexts for acute 

care hospitals. 

We agreed with the commenters so, in 

the May 6, 2011 IPF PPS final rule (76 

FR 26455), we adopted the temporary 

resident cap adjustment policies 

described below, similar to the 

temporary adjustments to the FTE cap 

used for acute care hospitals. 

b. Temporary Adjustment to the FTE 

Cap To Reflect Residents Added Due to 

Hospital Closure 

In the May 6, 2011 IPF PPS final rule 

(76 FR 26455), we added a new 

§ 412.424(d)(1)(iii)(F)(1) to allow a 

temporary adjustment to an IPF’s FTE 

cap to reflect residents added because of 

another IPF’s closure on or after July 1, 

2011, to be effective for cost reporting 

periods beginning on or after July 1, 

2011. For purposes of this policy, we 

adopted the IPPS definition of ‘‘closure 

of a hospital’’ in 42 CFR 413.79(h) to 


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mean the IPF terminates its Medicare 

provider agreement as specified in 42 

CFR 489.52. The regulations permit an 

adjustment to an IPF’s FTE cap if the 

IPF meets the following criteria: (1) The 

IPF is training displaced residents from 

another IPF that closed on or after July 

1, 2011; and (2) no later than 60 days 

after the hospital first begins training 

the displaced residents, the IPF that is 

training the displaced residents from the 

closed IPF submits a request for a 

temporary adjustment to its FTE cap to 

its Medicare Administrative Contractor 

(MAC), and documents that the IPF is 

eligible for this temporary adjustment to 

its FTE cap by identifying the residents 

who have come from the closed IPF and 

have caused the requesting IPF to 

exceed its cap, (or the IPF may already 

be over its cap) and specifies the length 

of time that the adjustment is needed. 

After the displaced residents leave the 

IPF’s training program or complete their 

residency program, the IPF’s cap would 

revert to its original level. Further, the 

total amount of temporary cap 

adjustments that can be distributed to 

all receiving hospitals cannot exceed the 

cap amount of the IPF that closed. 

c. Temporary Adjustment to FTE To Cap 

Reflect Residents Affected by Residency 

Program Closure 

In the May 6, 2011 final rule (76 FR 

26455), we added a new 

§ 412.424(d)(1)(iii)(F)(2) providing that 

if an IPF that ceases training residents 

in a residency training program(s) agrees 

to temporarily reduce its FTE cap, we 

would allow another IPF to receive a 

temporary adjustment to its FTE cap to 

reflect residents added because of the 

closure of another IPF’s residency 

training program. For purposes of this 

policy on closed residency programs, 

we apply the IPPS definition of ‘‘closure 

of a hospital residency training 

program’’ to mean that the hospital 

ceases to offer training for residents in 

a particular approved medical residency 

training program as specified in 

§ 413.79(h). The methodology for 

adjusting the caps for the ‘‘receiving 

IPF’’ and the ‘‘IPF that closed its 

program’’ is described below. 

i. Receiving IPF 

The regulations at 

§ 412.424(d)(1)(iii)(F)(2)(i) allow an IPF 

to receive a temporary adjustment to its 

FTE cap to reflect residents added 

because of the closure of another IPF’s 

residency training program for cost 

reporting periods beginning on or after 

July 1, 2011 if— 

• The IPF is training additional 

residents from the residency training 

program of an IPF that closed its 

program on or after July 1, 2011. 

• No later than 60 days after the IPF 

begins to train the residents, the IPF 

submits to its MAC a request for a 

temporary adjustment to its FTE cap, 

documents that the IPF is eligible for 

this temporary adjustment by 

identifying the residents who have come 

from another IPF’s closed program and 

have caused the IPF to exceed its cap, 

(or the IPF may already be in excess of 

its cap), specifies the length of time the 

adjustment is needed, and submits to its 

MAC a copy of the FTE cap reduction 

statement by the IPF closing the 

residency training program. 

ii. IPF That Closed Its Program 

The regulations at 

§ 412.424(d)(1)(iii)(F)(2)(ii) provide that 

an IPF that agrees to train residents who 

have been displaced by the closure of 

another IPF’s resident teaching program 

may receive a temporary FTE cap 

adjustment only if the IPF that closed a 

program: 

• Temporarily reduces its FTE cap 

based on the number of FTE residents 

in each program year, training in the 

program at the time of the program’s 

closure. 

• No later than 60 days after the 

residents who were in the closed 

program begin training at another IPF, 

submits to its MAC a statement signed 

and dated by its representative that 

specifies that it agrees to the temporary 

reduction in its FTE cap to allow the IPF 

training the displaced residents to 

obtain a temporary adjustment to its 

cap; identifies the residents who were 

training at the time of the program’s 

closure; identifies the IPFs to which the 

residents are transferring once the 

program closes; and specifies the 

reduction for the applicable program 

years. 

A complete discussion on the 

temporary adjustment to the FTE cap to 

reflect residents added due to hospital 

closure and by residency program 

appears in the January 27, 2011 IPF PPS 

proposed rule (76 FR 5018 through 

5020) and the May 6, 2011 IPF PPS final 

rule (76 FR 26453 through 26456). 

4. Proposed Cost of Living Adjustment 

for IPFs Located in Alaska and Hawaii 

The IPF PPS includes a payment 

adjustment for IPFs located in Alaska 

and Hawaii based upon the county in 

which the IPF is located. As we 

explained in the November 2004 IPF 

PPS final rule, the FY 2002 data 

demonstrated that IPFs in Alaska and 

Hawaii had per diem costs that were 

disproportionately higher than other 

IPFs. Other Medicare PPSs (for example, 

the IPPS and LTCH PPS) adopted a cost 

of living adjustment (COLA) to account 

for the cost differential of care furnished 

in Alaska and Hawaii. 

We analyzed the effect of applying a 

COLA to payments for IPFs located in 

Alaska and Hawaii. The results of our 

analysis demonstrated that a COLA for 

IPFs located in Alaska and Hawaii 

would improve payment equity for 

these facilities. As a result of this 

analysis, we provided a COLA in the 

November 2004 IPF PPS final rule. 

A COLA for IPFs located in Alaska 

and Hawaii is made by multiplying the 

nonlabor-related portion of the Federal 

per diem base rate by the applicable 

COLA factor based on the COLA area in 

which the IPF is located. 

The COLA factors are published on 

the Office of Personnel Management 

(OPM) Web site (http://www.opm.gov/

oca/cola/rates.asp). 

We note that the COLA areas for 

Alaska are not defined by county as are 

the COLA areas for Hawaii. In 5 CFR 

591.207, the OPM established the 

following COLA areas: 

• City of Anchorage, and 80-kilometer 

(50-mile) radius by road, as measured 

from the Federal courthouse; 

• City of Fairbanks, and 80-kilometer 

(50-mile) radius by road, as measured 

from the Federal courthouse; 

• City of Juneau, and 80-kilometer 

(50-mile) radius by road, as measured 

from the Federal courthouse; 

• Rest of the State of Alaska. 

As stated in the November 2004 IPF 

PPS final rule, we update the COLA 

factors according to updates established 

by the OPM. However, sections 1911 

through 1919 of the Nonforeign Area 

Retirement Equity Assurance Act, as 

contained in subtitle B of title XIX of the 

National Defense Authorization Act 

(NDAA) for Fiscal Year 2010 (Pub. L. 

111–84, October 28, 2009), transitions 

the Alaska and Hawaii COLAs to 

locality pay. Under section 1914 of 

Public Law 111–84, locality pay is being 

phased in over a 3-year period 

beginning in January 2010, with COLA 

rates frozen as of the date of enactment, 

October 28, 2009, and then 

proportionately reduced to reflect the 

phase-in of locality pay. 

When we published the proposed 

COLA factors in the January 2011 IPF 

PPS proposed rule (76 FR 4998), we 

inadvertently selected the FY 2010 

COLA rates which had been reduced to 

account for the phase-in of locality pay. 

We did not intend to propose the 

reduced COLA rates because that would 

have understated the adjustment. Since 

the 2009 COLA rates did not reflect the 

phase-in of locality pay, we finalized 

the FY 2009 COLA rates for RY 2010 


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through RY 2014 and indicated our 

intent to address the COLA in FY 2015. 

Currently, IPFs located in Alaska and 

Hawaii receive the updated COLA 

factors based on the COLA area in 

which the IPF is located as shown in 

Table 10 below. 

TABLE 10—COLA FACTORS FOR ALASKA AND HAWAII IPFS

Area 

Cost of living 

adjustment 

factor 

Alaska: 

City of Anchorage and 80-kilometer (50-mile) radius by road ............................................................................................... 1.23 

City of Fairbanks and 80-kilometer (50-mile) radius by road ................................................................................................ 1.23 

City of Juneau and 80-kilometer (50-mile) radius by road .................................................................................................... 1.23 

Rest of Alaska ........................................................................................................................................................................ 1.25 

Hawaii: 

City and County of Honolulu .................................................................................................................................................. 1.25 

County of Hawaii .................................................................................................................................................................... 1.18 

County of Kauai ...................................................................................................................................................................... 1.25 

County of Maui and County of Kalawao ................................................................................................................................ 1.25 

(The above factors are based on data obtained from the U.S. Office of Personnel Management Web site at: http://www.opm.gov/oca/cola/

rates.asp.) 

In the FY 2013 IPPS/LTCH final rule 

(77 FR 53700 through 53701), CMS 

established a methodology for FY 2014 

to update the COLA factors for Alaska 

and Hawaii. Under that methodology, 

we use a comparison of the growth in 

the Consumer Price Indices (CPIs) in 

Anchorage, Alaska and Honolulu, 

Hawaii relative to the growth in the 

overall CPI as published by the Bureau 

of Labor Statistics (BLS) to update the 

COLA factors for all areas in Alaska and 

Hawaii, respectively. As discussed in 

the FY 2013 IPPS/LTCH proposed rule 

(77 FR 28145), because BLS publishes 

CPI data for only Anchorage, Alaska and 

Honolulu, Hawaii, our methodology for 

updating the COLA factors uses a 

comparison of the growth in the CPIs for 

those cities relative to the growth in the 

overall CPI to update the COLA factors 

for all areas in Alaska and Hawaii, 

respectively. We believe that the relative 

price differences between these cities 

and the United States (as measured by 

the CPIs mentioned above) are generally 

appropriate proxies for the relative price 

differences between the ‘‘other areas’’ of 

Alaska and Hawaii and the United 

States. 

The CPIs for ‘‘All Items’’ that BLS 

publishes for Anchorage, Alaska, 

Honolulu, Hawaii, and for the average 

U.S. city are based on a different mix of 

commodities and services than is 

reflected in the nonlabor-related share 

of the IPPS market basket. As such, 

under the methodology we established 

to update the COLA factors, we 

calculated a ‘‘reweighted CPI’’ using the 

CPI for commodities and the CPI for 

services for each of the geographic areas 

to mirror the composition of the IPPS 

market basket nonlabor-related share. 

The current composition of BLS’ CPI for 

‘‘All Items’’ for all of the respective 

areas is approximately 40 percent 

commodities and 60 percent services. 

However, the nonlabor-related share of 

the IPPS market basket is comprised of 

60 percent commodities and 40 percent 

services. Therefore, under the 

methodology established for FY 2014 in 

the FY 2013 IPPS/LTCH PPS final rule, 

we created reweighted indexes for 

Anchorage, Alaska, Honolulu, Hawaii, 

and the average U.S. city using the 

respective CPI commodities index and 

CPI services index and applying the 

approximate 60/40 weights from the 

IPPS market basket. This approach is 

appropriate because we would continue 

to make a COLA for hospitals located in 

Alaska and Hawaii by multiplying the 

nonlabor-related portion of the 

standardized amount by a COLA factor. 

Under the COLA factor update 

methodology established in the FY 2014 

IPPS/LTCH final rule, we adjust 

payments made to hospitals located in 

Alaska and Hawaii by incorporating a 

25-percent cap on the CPI-updated 

COLA factors. We note that OPM’s 

COLA factors were calculated with a 

statutorily mandated cap of 25 percent, 

and since at least 1984, we have 

exercised our discretionary authority to 

adjust Alaska and Hawaii payments by 

incorporating this cap. In keeping with 

this historical policy, we would 

continue to use such a cap, as our 

proposal is based on OPM’s COLA 

factors. We believe this approach is 

appropriate because our CPI-updated 

COLA factors use the 2009 OPM COLA 

factors as a basis. 

We believe it is appropriate to adopt 

the same methodology for the COLA 

factors applied under the IPPS because 

IPFs are hospitals with a similar mix of 

commodities and services. In addition, 

we think it is appropriate to have a 

consistent policy approach with that of 

other hospitals in Alaska and Hawaii. 

Therefore, we are proposing to adopt the 

cost of living adjustment factors shown 

in Table 11 below for IPFs located in 

Alaska and Hawaii. 

TABLE 11—COST-OF-LIVING ADJUSTMENT FACTORS: ALASKA AND HAWAII HOSPITALS AREA COLA FACTOR

Area 

Cost of living 

adjustment 

factor 

Alaska: 

City of Anchorage and 80-kilometer (50-mile) radius by road ............................................................................................... 1.23 

City of Fairbanks and 80-kilometer (50-mile) radius by road ................................................................................................ 1.23 

City of Juneau and 80-kilometer (50-mile) radius by road .................................................................................................... 1.23 

Rest of Alaska ........................................................................................................................................................................ 1.25 

Hawaii: 

City and County of Honolulu .................................................................................................................................................. 1.25 

County of Hawaii .................................................................................................................................................................... 1.19 


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TABLE 11—COST-OF-LIVING ADJUSTMENT FACTORS: ALASKA AND HAWAII HOSPITALS AREA COLA FACTOR—Continued 

Area 

Cost of living 

adjustment 

factor 

County of Kauai ...................................................................................................................................................................... 1.25 

County of Maui and County of Kalawao ................................................................................................................................ 1.25 

5. Proposed Adjustment for IPFs With a 

Qualifying Emergency Department (ED) 

The IPF PPS includes a facility-level 

adjustment for IPFs with qualifying EDs. 

We provide an adjustment to the 

Federal per diem base rate to account 

for the costs associated with 

maintaining a full-service ED. The 

adjustment is intended to account for 

ED costs incurred by a freestanding 

psychiatric hospital with a qualifying 

ED or a distinct part psychiatric unit of 

an acute care hospital or a CAH for 

preadmission services otherwise 

payable under the Medicare Outpatient 

Prospective Payment System (OPPS) 

furnished to a beneficiary on the date of 

the beneficiary’s admission to the 

hospital and during the day 

immediately preceding the date of 

admission to the IPF (see § 413.40(c)(2)) 

and the overhead cost of maintaining 

the ED. This payment is a facility-level 

adjustment that applies to all IPF 

admissions (with one exception 

described below), regardless of whether 

a particular patient receives 

preadmission services in the hospital’s 

ED. 

The ED adjustment is incorporated 

into the variable per diem adjustment 

for the first day of each stay for IPFs 

with a qualifying ED. That is, IPFs with 

a qualifying ED receive an adjustment 

factor of 1.31 as the variable per diem 

adjustment for day 1 of each stay. If an 

IPF does not have a qualifying ED, it 

receives an adjustment factor of 1.19 as 

the variable per diem adjustment for day 

1 of each patient stay. 

The ED adjustment is made on every 

qualifying claim except as described 

below. As specified in 

§ 412.424(d)(1)(v)(B), the ED adjustment 

is not made when a patient is 

discharged from an acute care hospital 

or CAH and admitted to the same 

hospital’s or CAH’s psychiatric unit. We 

clarified in the November 2004 IPF PPS 

final rule (69 FR 66960) that an ED 

adjustment is not made in this case 

because the costs associated with ED 

services are reflected in the DRG 

payment to the acute care hospital or 

through the reasonable cost payment 

made to the CAH. 

Therefore, when patients are 

discharged from an acute care hospital 

or CAH and admitted to the same 

hospital or CAH’s psychiatric unit, the 

IPF receives the 1.19 adjustment factor 

as the variable per diem adjustment for 

the first day of the patient’s stay in the 

IPF. 

For FY 2015, we are proposing to 

retain the 1.31 adjustment factor for 

IPFs with qualifying EDs. A complete 

discussion of the steps involved in the 

calculation of the ED adjustment factor 

appears in the November 2004 IPF PPS 

final rule (69 FR 66959 through 66960) 

and the May 2006 IPF PPS final rule (71 

FR 27070 through 27072). 

D. Other Payment Adjustments and 

Policies 

1. Outlier Payments 

The IPF PPS includes an outlier 

adjustment to promote access to IPF 

care for those patients who require 

expensive care and to limit the financial 

risk of IPFs treating unusually costly 

patients. In the November 2004 IPF PPS 

final rule, we implemented regulations 

at § 412.424(d)(3)(i) to provide a percase payment for IPF stays that are 

extraordinarily costly. Providing 

additional payments to IPFs for 

extremely costly cases strongly 

improves the accuracy of the IPF PPS in 

determining resource costs at the patient 

and facility level. These additional 

payments reduce the financial losses 

that would otherwise be incurred in 

treating patients who require more 

costly care and, therefore, reduce the 

incentives for IPFs to under-serve these 

patients. 

We make outlier payments for 

discharges in which an IPF’s estimated 

total cost for a case exceeds a fixed 

dollar loss threshold amount 

(multiplied by the IPF’s facility-level 

adjustments) plus the Federal per diem 

payment amount for the case. 

In instances when the case qualifies 

for an outlier payment, we pay 80 

percent of the difference between the 

estimated cost for the case and the 

adjusted threshold amount for days 1 

through 9 of the stay (consistent with 

the median LOS for IPFs in FY 2002), 

and 60 percent of the difference for day 

10 and thereafter. We established the 80 

percent and 60 percent loss sharing 

ratios because we were concerned that 

a single ratio established at 80 percent 

(like other Medicare PPSs) might 

provide an incentive under the IPF per 

diem payment system to increase LOS 

in order to receive additional payments. 

After establishing the loss sharing 

ratios, we determined the current fixed 

dollar loss threshold amount of $10,245 

through payment simulations designed 

to compute a dollar loss beyond which 

payments are estimated to meet the 2 

percent outlier spending target. Each 

year when we update the IPF PPS, we 

simulate payments using the latest 

available data to compute the fixed 

dollar loss threshold so that outlier 

payments represent 2 percent of total 

projected IPF PPS payments. 

a. Proposed Update to the Outlier Fixed 

Dollar Loss Threshold Amount 

In accordance with the update 

methodology described in § 412.428(d), 

we propose to update the fixed dollar 

loss threshold amount used under the 

IPF PPS outlier policy. Based on the 

regression analysis and payment 

simulations used to develop the IPF 

PPS, we established a 2 percent outlier 

policy which strikes an appropriate 

balance between protecting IPFs from 

extraordinarily costly cases while 

ensuring the adequacy of the Federal 

per diem base rate for all other cases 

that are not outlier cases. 

Based on an analysis of the latest 

available data (that is, FY 2013 IPF 

claims) and rate increases, we believe it 

is necessary to update the fixed dollar 

loss threshold amount in order to 

maintain an outlier percentage that 

equals 2 percent of total estimated IPF 

PPS payments. 

In the May 2006 IPF PPS final rule (71 

FR 27072), we describe the process by 

which we calculate the outlier fixed 

dollar loss threshold amount. We are 

not proposing changes to this process 

for FY 2015. We begin by simulating 

aggregate payments with and without an 

outlier policy, and applying an iterative 

process to determine an outlier fixed 

dollar loss threshold amount that will 

result in estimated outlier payments 

being equal to 2 percent of total 

estimated payments under the 

simulation. Based on this process, using 

the FY 2013 claims data, we estimate 

that IPF outlier payments as a 

percentage of total estimated payments 

are approximately 1.9 percent in FY 


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Federal Register / Vol. 79, No. 87 / Tuesday, May 6, 2014 / Proposed Rules 26061 

2014. Thus, we propose to update the 

FY 2015 IPF outlier threshold amount to 

ensure that estimated FY 2015 outlier 

payments are approximately 2 percent 

of total estimated IPF payments. The 

outlier fixed dollar loss threshold 

amount of $10,245 for FY 2014 would 

be changed to $10,125 for FY 2015 to 

increase estimated outlier payments and 

thereby maintain estimated outlier 

payments at 2 percent of total estimated 

aggregate IPF payments for FY 2015. 

b. Proposed Update to IPF Cost-toCharge Ratio Ceilings 

Under the IPF PPS, an outlier 

payment is made if an IPF’s cost for a 

stay exceeds a fixed dollar loss 

threshold amount plus the IPF PPS 

amount. In order to establish an IPF’s 

cost for a particular case, we multiply 

the IPF’s reported charges on the 

discharge bill by its overall cost-tocharge ratio (CCR). This approach to 

determining an IPF’s cost is consistent 

with the approach used under the IPPS 

and other PPSs. In the June 2003 IPPS 

final rule (68 FR 34494), we 

implemented changes to the IPPS policy 

used to determine CCRs for acute care 

hospitals because we became aware that 

payment vulnerabilities resulted in 

inappropriate outlier payments. Under 

the IPPS, we established a statistical 

measure of accuracy for CCRs in order 

to ensure that aberrant CCR data did not 

result in inappropriate outlier 

payments. 

As we indicated in the November 

2004 IPF PPS final rule (69 FR 66961), 

because we believe that the IPF outlier 

policy is susceptible to the same 

payment vulnerabilities as the IPPS, we 

adopted a method to ensure the 

statistical accuracy of CCRs under the 

IPF PPS. Specifically, we adopted the 

following procedure in the November 

2004 IPF PPS final rule: We calculated 

two national ceilings, one for IPFs 

located in rural areas and one for IPFs 

located in urban areas. We computed 

the ceilings by first calculating the 

national average and the standard 

deviation of the CCR for both urban and 

rural IPFs using the most recent CCRs 

entered in the CY 2014 Provider 

Specific File. 

To determine the rural and urban 

ceilings, we multiplied each of the 

standard deviations by 3 and added the 

result to the appropriate national CCR 

average (either rural or urban). The 

upper threshold CCR for IPFs in FY 

2015 is 1.8823 for rural IPFs, and 1.7049 

for urban IPFs, based on CBSA-based 

geographic designations. If an IPF’s CCR 

is above the applicable ceiling, the ratio 

is considered statistically inaccurate 

and we assign the appropriate national 

(either rural or urban) median CCR to 

the IPF. 

We apply the national CCRs to the 

following situations: 

++ New IPFs that have not yet 

submitted their first Medicare cost 

report. We continue to use these 

national CCRs until the facility’s actual 

CCR can be computed using the first 

tentatively or final settled cost report. 

++ IPFs whose overall CCR is in 

excess of 3 standard deviations above 

the corresponding national geometric 

mean (that is, above the ceiling). 

++ Other IPFs for which the MAC 

obtains inaccurate or incomplete data 

with which to calculate a CCR. 

We are not proposing to make any 

changes to the application of the 

national CCRs or to the procedures for 

updating the CCR ceilings in FY 2015. 

However, we are proposing to update 

the FY 2015 national median and 

ceiling CCRs for urban and rural IPFs 

based on the CCRs entered in the latest 

available IPF PPS Provider Specific File. 

Specifically, for FY 2015, and to be used 

in each of the three situations listed 

above, using the most recent CCRs 

entered in the CY 2014 Provider 

Specific File we estimate the national 

median CCR of 0.6220 for rural IPFs and 

the national median CCR of 0.4700 for 

urban IPFs. These calculations are based 

on the IPF’s location (either urban or 

rural) using the CBSA-based geographic 

designations. 

A complete discussion regarding the 

national median CCRs appears in the 

November 2004 IPF PPS final rule (69 

FR 66961 through 66964). 

2. Future Refinements 

For RY 2012, we identified several 

areas of concern for future refinement 

and we invited comments on these 

issues in our RY 2012 proposed and 

final rules. For further discussion of 

these issues and to review the public 

comments, we refer readers to the RY 

2012 IPF PPS proposed rule (76 FR 

4998) and final rule (76 FR 26432). 

As we have indicated throughout this 

proposed rule, we have delayed making 

refinements to the IPF PPS until we 

have completed a thorough analysis of 

IPF PPS data on which to base those 

refinements. Specifically, we explained 

that we will delay updating the 

adjustment factors derived from the 

regression analysis until we have IPF 

PPS data that include as much 

information as possible regarding the 

patient-level characteristics of the 

population that each IPF serves. We 

have begun the necessary analysis to 

better understand IPF industry practices 

so that we may refine the IPF PPS as 

appropriate. Using more recent data, we 

plan to re-run the regression analyses 

and the patient-and facility-level 

adjustments. While we are not 

proposing refinements in this proposed 

rule, we expect that in the rulemaking 

for FY 2017 we will be ready to present 

the results of our analysis. 

VII. Secretary’s Recommendations 

Section 1886(e)(4)(A) of the Act 

requires the Secretary, taking into 

consideration the recommendations of 

the Medicare Payment Advisory 

Committee (MedPAC), to recommend 

update factors for inpatient hospital 

services (including IPFs) for each FY 

that take into account the amounts 

necessary for the efficient and effective 

delivery of medically appropriate and 

necessary care of high quality. Section 

1886(e)(5) of the Act requires the 

Secretary to publish the recommended 

and final update factors in the Federal 

Register. 

In the past, the Secretary’s 

recommendations and a discussion 

about the MedPAC recommendations 

for the IPF PPS were included in the 

IPPS proposed and final rules. The 

market basket update for the IPF PPS 

was also included in the IPPS proposed 

and final rules, as well as in the IPF PPS 

annual update. 

Beginning in FY 2013, however, we 

have only published the market basket 

update for the IPF PPS in the annual IPF 

PPS FY update and not in the IPPS 

proposed and final rules. In addition, 

for any years in which MedPAC makes 

recommendations for the IPF PPS, those 

recommendations will be addressed in 

the IPF PPS update. 

MedPAC did not make any 

recommendations for the IPF PPS for FY 

2015. For the update to the IPF PPS 

standard Federal rate for FY 2015, see 

section IV B. of this proposed rule. 

VIII. Inpatient Psychiatric Facilities 

Quality Reporting (IPFQR) Program 

1. Statutory Authority 

Section 1886(s)(4) of the Act, as added 

and amended by sections 3401(f) and 

10322(a) of the Affordable Care Act, 

requires the Secretary to implement a 

quality reporting program for inpatient 

psychiatric hospitals and psychiatric 

units. Section 1886(s)(4)(A)(i) of the Act 

requires that, for rate year (RY) 2014 and 

each subsequent rate year, the Secretary 

shall reduce any annual update to a 

standard Federal rate for discharges 

occurring during the rate year by 2.0 

percentage points for any inpatient 

psychiatric hospital or psychiatric unit 

that does not comply with quality data 

submission requirements with respect to 

an applicable rate year. 


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As noted above, section 

1886(s)(4)(A)(i) of the Act uses the term 

‘‘rate year.’’ Beginning with the annual 

update of the inpatient psychiatric 

facility prospective payment system 

(IPF PPS) that took effect on July 1, 2011 

(RY 2012), we aligned the IPF PPS 

update with the annual update of the 

ICD–9–CM codes, which are effective on 

October 1 of each year. The change 

allows for annual payment updates and 

the ICD–9–CM coding update to occur 

on the same schedule and appear in the 

same Federal Register document, thus 

making updating rules more 

administratively efficient. To reflect the 

change to the annual payment rate 

update cycle, we revised the regulations 

at 42 CFR 412.402 to specify that, 

beginning October 1, 2012, the rate year 

update period would be the 12-month 

period of October 1 through September 

30, which we refer to as a fiscal year 

(FY) (76 FR 26435). For more 

information regarding this terminology 

change, we refer readers to section III. 

of the RY 2012 IPF PPS final rule (76 FR 

26434 through 26435). 

As provided in section 

1886(s)(4)(A)(ii) of the Act, the 

application of the reduction for failure 

to report under section 1886(s)(4)(A)(i) 

of the Act may result in an annual 

update of less than 0.0 percent for a 

fiscal year, and may result in payment 

rates under section 1886(s)(1) of the Act 

being less than the payment rates for the 

preceding year. In addition, section 

1886(s)(4)(B) of the Act requires that the 

application of the reduction to a 

standard Federal rate update be 

noncumulative across fiscal years. Thus, 

any reduction applied under section 

1886(s)(4)(A) of the Act will apply only 

with respect to the fiscal year rate 

involved and the Secretary shall not 

take into account the reduction in 

computing the payment amount under 

the system described in section 

1886(s)(1) of the Act for subsequent 

years. 

Section 1886(s)(4)(C) of the Act 

requires that, for FY 2014 (October 1, 

2013, through September 30, 2014) and 

each subsequent year, each psychiatric 

hospital and psychiatric unit shall 

submit to the Secretary data on quality 

measures as specified by the Secretary. 

The data shall be submitted in a form 

and manner, and at a time, specified by 

the Secretary. Under section 

1886(s)(4)(D)(i) of the Act, measures 

selected for the quality reporting 

program must have been endorsed by 

the entity with a contract under section 

1890(a) of the Act. The National Quality 

Forum (NQF) currently holds this 

contract. 

Section 1886(s)(4)(D)(ii) of the Act 

provides that, in the case of a specified 

area or medical topic determined 

appropriate by the Secretary for which 

a feasible and practical measure has not 

been endorsed by the entity with a 

contract under section 1890(a) of the 

Act, the Secretary may specify a 

measure that is not so endorsed as long 

as due consideration is given to 

measures that have been endorsed or 

adopted by a consensus organization 

identified by the Secretary. Pursuant to 

section 1886(s)(4)(D)(iii) of the Act, the 

Secretary shall publish the measures 

applicable to the FY 2014 IPFQR 

Program no later than October 1, 2012. 

Section 1886(s)(4)(E) of the Act 

requires the Secretary to establish 

procedures for making public the data 

submitted by inpatient psychiatric 

hospitals and psychiatric units under 

the IPFQR Program. These procedures 

must ensure that a facility has the 

opportunity to review its data prior to 

the data being made public. The 

Secretary must report quality measures 

that relate to services furnished by the 

psychiatric hospitals and units on the 

CMS Web site. 

2. Application of the Payment Update 

Reduction for Failure To Report for the 

FY 2015 Payment Determination and 

Subsequent Years 

Beginning in FY 2014, section 

1886(s)(4)(A)(i) of the Act requires the 

application of a 2.0 percentage point 

reduction to the applicable annual 

update to a Federal standard rate for 

those psychiatric hospitals and 

psychiatric units that fail to comply 

with the quality reporting requirements 

implemented in accordance with 

section 1886(s)(4)(C) of the Act, as 

detailed below. The application of the 

reduction may result in an annual 

update for a fiscal year that is less than 

0.0 percent and in payment rates for a 

fiscal year being less than the payment 

rates for the preceding fiscal year. 

Pursuant to section 1886(s)(4)(B) of the 

Act, any such reduction is not 

cumulative and will apply only to the 

fiscal year involved. In the FY 2013 

IPPS/LTCH PPS final rule (77 FR 

53678), we adopted requirements 

regarding the application of the 

payment reduction to the annual update 

of the standard Federal rate for failure 

to report data on measures selected for 

the FY 2014 payment determination and 

subsequent years and added new 

regulatory text at 42 CFR 412.424 to 

codify these requirements. 

3. Covered Entities 

In the FY 2013 IPPS/LTCH PPS final 

rule (77 FR 53645), we established that 

the IPFQR Program’s quality reporting 

requirements cover those psychiatric 

hospitals and psychiatric units paid 

under Medicare’s IPF PPS (42 CFR 

412.404(b)). Generally, psychiatric 

hospitals and psychiatric units within 

acute care and critical access hospitals 

that treat Medicare patients are paid 

under the IPF PPS. For more 

information on the application of, and 

exceptions to, payments under the IPF 

PPS, we refer readers to section IV. of 

the November 15, 2004 IPF PPS final 

rule (69 FR 66926). As we noted in the 

FY 2013 IPPS/LTCH PPS final rule (77 

FR 53645), we use the term ‘‘inpatient 

psychiatric facility’’ (IPF) to refer to 

both inpatient psychiatric hospitals and 

psychiatric units. This usage follows the 

terminology that we have used in the 

past in our IPF PPS regulations (42 CFR 

412.402). 

4. Considerations in Selecting Quality 

Measures 

In implementing the IPFQR Program, 

our overarching objective is to support 

the HHS National Quality Strategy 

(NQS) and CMS Quality Strategy’s goal 

for better health care for individuals, 

better health for populations, and lower 

costs for health care services. More 

information on the CMS Quality 

Strategy can be found at http://

www.cms.gov/Medicare/QualityInitiatives-Patient-AssessmentInstruments/QualityInitiativesGenInfo/

CMS-Quality-Strategy.html. 

Implementation of the IPFQR Program 

works to achieve the goals of the CMS 

Quality Strategy by promoting 

transparency around the quality of care 

provided at IPFs to support patient 

decision-making and drive quality 

improvement, as well as to further the 

alignment of quality measurement and 

improvement goals at IPFs with those of 

other health care providers. 

For purposes of the IPFQR Program, 

section 1886(s)(4)(D)(i) of the Act 

requires that any measure specified by 

the Secretary must have been endorsed 

by the entity with a contract under 

section 1890(a) of the Act. However, the 

statutory requirements under section 

1886(s)(4)(D)(ii) of the Act provide an 

exception that, in the case of a specified 

area or medical topic determined 

appropriate by the Secretary for which 

a feasible and practical measure has not 

been endorsed by the entity with a 

contract under section 1890(a) of the 

Act, the Secretary may specify a 

measure that is not so endorsed 

provided due consideration is given to 

measures that have been endorsed or 

adopted by a consensus organization 

identified by the Secretary. 


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We seek to collect data in a manner 

that balances the need for information 

related to the full spectrum of quality 

performance and the need to minimize 

the burden of data collection and 

reporting. We have focused on measures 

that have high impact and support CMS 

and HHS priorities for improved quality 

and efficiency of care provided by IPFs. 

We refer readers to the FY 2013 IPPS/ 

LTCH PPS final rule (77 FR 53645 

through 53646) for a detailed discussion 

of the considerations taken into account 

for measure development and selection. 

Measures proposed for the program 

were included in a publicly available 

document entitled ‘‘List of Measures 

under Consideration for December 1, 

2013’’ in compliance with section 

1890A(a)(2) of the Act, and they were 

reviewed by the MAP in its ‘‘MAP PreRulemaking Report: 2014 

Recommendations on Measures for 

More than 20 Federal Programs,’’ which 

is available on the NQF Web site a 

http://www.qualityforum.org/Setting_

Priorities/Partnership/Measure_

Applications_Partnership.aspx. We 

considered the input and 

recommendations provided by the MAP 

in selecting measures to propose for the 

IPFQR Program at this time. 

5. Quality Measures 

a. Proposed Quality Measures for the FY 

2016 Payment Determination and 

Subsequent Years 

In the FY 2013 IPPS/LTCH PPS final 

rule (77 FR 53646 through 53652), we 

adopted six chart-abstracted IPF quality 

measures for the FY 2014 payment 

determination and subsequent program 

years. 

We note that, at the time that we 

adopted the measures in the FY 2013 

IPPS/LTCH PPS final rule (77 FR 

53258), providers were using ICD–9–CM 

codes. We are proposing the conversion 

of ICD–9–CM to ICD–10–CM/PCS codes 

for the IPF PPS in this proposed rule, 

but in light of PAMA, the effective date 

of those changes would be the date 

when ICD–10 becomes the required 

medical data code set for use on 

Medicare claims. We do not anticipate 

that this change will have substantive 

effects on any measures at this time. 

CMS will update the user manual, 

discussed further in section V below to 

reflect any necessary measure updates. 

Generally, measures adopted for the 

IPFQR Program will remain in the 

Program for all subsequent years, unless 

and until specifically stated otherwise 

(such as, for example, through removal 

or replacement). 

In the FY 2014 IPPS/LTCH PPS final 

rule (78 FR 50890 through 50895), we 

added one new chart-abstracted 

measure for the IPFQR Program: 

Alcohol Use Screening (SUB–1) (NQF 

#1661). We also added one new claimsbased measure: Follow-Up After 

Hospitalization for Mental Illness (FUH) 

(NQF #0576). Both measures apply to 

the FY 2016 payment determination and 

subsequent years, unless and until we 

change them through future rulemaking. 

The table below sets out the 

previously adopted measures. 

TABLE 12—PREVIOUSLY ADOPTED QUALITY MEASURES FOR THE IPFQR PROGRAM

National quality strategy priority NQF No. Measure ID Measure description 

Patient Safety ........................................... 0640 HBIPS–2 Hours of Physical Restraint Use * 

0641 HBIPS–3 Hours of Seclusion Use * 

Clinical Quality of Care ............................. 0552 HBIPS–4 Patients Discharged on Multiple Antipsychotic Medications * 

0560 HBIPS–5 Patients Discharged on Multiple Antipsychotic Medications with 

Appropriate Justification * 

1661 SUB–1 Alcohol Use Screening ** 

0576 FUH Follow-Up After Hospitalization for Mental Illness ** 

Care Coordination .................................... 0557 HBIPS–6 Post-Discharge Continuing Care Plan Created * 

0558 HBIPS–7 Post-Discharge Continuing Care Plan Transmitted to Next Level of 

Care Provider Upon Discharge * 

* Quality measures adopted in the FY 2013 IPPS/LTCH PPS final rule for the FY 2014 payment determination and subsequent years. 

** Quality measures adopted in the FY 2014 IPPS/LTCH PPS final rule for the FY 2016 payment determination and subsequent years. 

We note that in the FY 2014 IPPS/

LTCH PPS final rule (78 FR 50896 

through 50897 and 50900), we also 

adopted for the FY 2016 payment 

determination and subsequent years a 

voluntary collection of information— 

IPF Assessment of Patient Experience of 

Care (now renamed Assessment of 

Patient Experience of Care), which was 

to be collected using a Web-Based 

Measures Tool, and which would not 

affect an IPF’s FY 2016 payment 

determination. We also noted that we 

intend to propose to make this a 

mandatory measure in future 

rulemaking (78 FR 50897), which we do 

in this proposed rule. 

b. Proposed Quality Measures for the FY 

2016 Payment Determination and 

Subsequent Years 

We are proposing to add two new 

measures to the IPFQR Program to those 

already adopted for the FY 2016 

payment determination and subsequent 

years: (1) Assessment of Patient 

Experience of Care; and (2) Use of an 

Electronic Health Record. We are not 

proposing to remove or replace any of 

the previously adopted measures from 

the IPFQR Program for FY 2016. These 

two measures will be captured in the 

IPF Web-based Measure Tool, which 

can be accessed through the QualityNet 

home page at: http://

www.qualitynet.org/dcs/

ContentServer?pagename=QnetPublic/

Page/QnetHomepage. The Tool will be 

updated so when IPFs submit their data 

for FY 2016 (between July 1, 2015 and 

August 15, 2015) there will be a place 

to provide responses to these two 

structural measures. 

1. Assessment of Patient Experience of 

Care 

Improvement of experience of care for 

patients, families, and caregivers is one 

of our objectives within the CMS 

Quality Strategy and is not currently 

addressed in the IPFQR Program. 

Surveys of individuals about their 

experience in all health care settings 

provide important information as to 

whether or not high-quality, personcentered care is actually provided and 

address elements of service delivery that 

matter most to recipients of care. 

We included the measure ‘‘Inpatient 

Consumer Survey (ICS) Consumer 

Evaluation of Inpatient Behavioral 

Healthcare Services’’ (NQF #0726) in 

our ‘‘List of Measures under 

Consideration for December 1, 2102.’’ 

The measure would have gathered 

clients’ evaluation of their inpatient care 

based on six domains—outcome, 

dignity, rights, treatment, environment, 

and empowerment. The MAP provided 

input on the measure and supported its 

inclusion in the IPFQR Program. 

However, we did not propose to adopt 


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26064 Federal Register / Vol. 79, No. 87 / Tuesday, May 6, 2014 / Proposed Rules 

1M.B. Buntin, M.F. Burke, M.C. Hoaglin et al., 

‘‘The Benefits of Health Information Technology: A 

Review of the Recent Literature Shows 

Predominantly Positive Results,’’ Health Affairs, 

March 2011 30(3):464–71. 

2 Ibid. 

3HealthIT.gov, ‘‘EHR Incentives & Certification: 

Meaningful Use Definition & Objectives.’’ [Internet 

Cited 2014 February 11]. Available from http://

www.healthit.gov/providers-professionals/

meaningful-use-definition-objectives. 

the measure in the FY 2014 IPPS/LTCH 

PPS proposed rule for several reasons, 

including potential reporting and 

information collection burdens in a new 

program, and compatibility with the 

content and format of other similar CMS 

beneficiary surveys (78 FR 27740 and 78 

FR 50896). We also recognized the 

challenges of measuring patient 

experience of care, particularly for 

involuntary cases and geriatric 

psychiatric patients suffering from 

dementia. In addition, we recognized 

that IPFs may have developed their own 

survey instruments, which we wanted 

to learn more about prior to requiring 

collection of a patient experience of care 

survey for the IPFQR (78 FR 50897). 

Instead, we indicated our intention to 

pursue the adoption of a standardized 

measure of patient experience of care for 

the IPFQR program in the near future. 

In the final rule, in an effort to 

proceed cautiously with the selection of 

an assessment instrument and collection 

protocol, and as an intermediate 

measure, we implemented a voluntary 

collection of information on whether 

IPFs administer a detailed assessment of 

patient experience of care using a 

standardized collection protocol and a 

structured instrument. If the IPFs 

answered ‘‘Yes,’’ we also asked them to 

indicate the name of the survey that 

they administer. We indicated our 

intention to propose to change this 

request for voluntary information into a 

mandatory measure in future 

rulemaking. We are now proposing to 

make this request a required structural 

measure for the FY 2016 payment 

determination. 

The measure ‘‘Inpatient Psychiatric 

Facility Routinely Assesses Patient 

Experience of Care’’ (now, ‘‘Assessment 

of Patient Experience of Care’’) was 

included on our ‘‘List of Measures 

under Consideration for December 1, 

2013.’’ The measure asks IPFs whether 

they routinely assess patient experience 

of care using a standardized collection 

protocol and a structured instrument. 

The MAP supported this measure, but 

encouraged its eventual replacement 

with a robust survey of patient 

experience and a measure based on 

consumer-reported information, such as 

a CAHPS tool. We believe the reporting 

of this measure will begin to provide 

information on a priority area of the 

HHS National Quality Strategy that is 

currently unaddressed in the IPFQR 

program, that of patient and family 

engagement and experience of care. 

Further, the information gathered 

through the collection of this measure 

will be helpful in the development of a 

standardized survey of patient 

assessment of care that we intend to 

develop as a successor to this measure. 

Because this is a structural measure 

that does not depend on systems for 

collecting and abstracting individual 

patient information, only requires 

simple attestation, and does not require 

extended time to prepare to report, we 

believe that it will not be burdensome 

to IPFs. Accordingly, we are proposing 

to include it as a mandatory measure for 

the FY 2016 payment determination, a 

year earlier than for other measures 

proposed in this rule that are dependent 

on these systems. 

The proposed measure is currently 

not NQF-endorsed. Section 

1886(s)(4)(D)(ii) of the Act authorizes 

the Secretary to specify a measure that 

is not endorsed by the NQF as long as 

due consideration is given to measures 

that have been endorsed or adopted by 

a consensus organization identified by 

the Secretary. We attempted to find 

available measures that have been 

endorsed or adopted by a consensus 

organization and found no other feasible 

and practical measures on the topic of 

patient experience of care for the IPF 

setting. Therefore, we believe that the 

Assessment of Patient Experience of 

Care proposed measure meets the 

measure selection exception 

requirement under section 

1886(s)(4)(D)(ii) of the Act. 

2. Use of an Electronic Health Record 

(EHR) 

In 2009, as part of the Health 

Information Technology for Economic 

and Clinical Health (HITECH) Act, 

incentives were provided to encourage 

eligible hospitals and eligible 

professionals to adopt EHR systems. The 

widespread adoption of these systems 

holds the potential to support multiple 

goals of CMS’ quality strategy, including 

making care safer and more affordable, 

and promoting coordination of care. 

One review of over a hundred studies of 

the effects of EHRs showed that nearly 

all demonstrated positive overall 

results.1 These results were most 

frequently demonstrated in the areas of 

efficiency and effectiveness of care, 

patient safety and satisfaction, and 

process of care.2

Positive results such as these depend 

in part on the ways in which an EHR 

system is used. EHRs can facilitate the 

use of clinical decision support tools, 

physician order entry systems, and 

health information exchange. The 

concept of ‘‘meaningful use’’ of EHRs 

captures the goals for which incentive 

payments are made. These goals 

include: Quality improvement, safety, 

and efficiency; health disparities 

reduction; patient and family 

engagement; care coordination 

improvement and population health; 

and maintenance of the privacy and 

security of patient health information.3

We believe that a measure of the 

degree of EHR implementation provides 

important information about an element 

of IPF service delivery shown to be 

associated with the delivery of quality 

care. Further, we believe that it provides 

useful information to consumers and 

others in choosing among different 

facilities. 

A key issue in EHR adoption and 

implementation is the use of this 

technology to support health 

information exchange. HHS has a 

number of initiatives designed to 

encourage and support the adoption of 

health information technology and 

promote nationwide health information 

exchange to improve health care. The 

Office of the National Coordinator for 

Health Information Technology (ONC) 

and CMS work to promote the adoption 

of health information technology. 

Through a number of activities, HHS is 

promoting the adoption of ONCcertified electronic health records 

(EHRs) developed to support secure, 

interoperable health information 

exchange. While ONC-certified EHRs 

are not yet available for IPFQRs and 

other providers who are not eligible for 

the Medicare and Medicaid EHR 

Incentive Programs, ONC has requested 

that the HIT Policy Committee (a 

Federal Advisory Committee) explore 

the expansion of EHR certification 

under the ONC HIT Certification 

Program, focusing on EHR certification 

criteria needed for long-term and postacute care (including LTCHs), and 

behavioral health care providers. ONC 

has also proposed a Voluntary 2015 

Edition EHR Certification rule (79 FR 

10880) that would increase the 

flexibility in ONC’s regulatory structure 

to more easily accommodate health IT 

certification for other types of health 

care settings where individual or 

institutional health care providers are 

not typically eligible to qualify for the 

Medicare and Medicaid EHR Incentive 

Programs. 

We believe that the use of certified 

EHRs by IPFs (and other providers 

ineligible for the Medicare and 


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Federal Register / Vol. 79, No. 87 / Tuesday, May 6, 2014 / Proposed Rules 26065 

4Centers for Disease Control and Prevention. 

‘‘People at High Risk of Developing Flu-Related 

Complications.’’ [Internet Cited 2014 February 11]. 

Available from http://www.cdc.gov/flu/about/

disease/high_risk.htm. 

5Thompson W.W., Shay D.K., Weintraub E., 

Brammer L, Cox N, Anderson L.J., Fukuda. 

‘‘Mortality associated with influenza and 

respiratory syncytial virus in the United States.’’ 

JAMA. 2003 January 8; 289 (2): 179–186. 

6Centers for Disease Control and Prevention. 

Newsroom press release February 24, 2010. ‘‘CDC’s 

Advisory Committee on Immunization Practices 

(ACIP) Recommends Universal Annual Influenza 

Vaccination.’’ [Internet Cited 2010 March 3]. 

Available from http://www.cdc/media/pressrel/

2010/r100224.htm. 

7Risa K.J., et al. ‘‘Influenza outbreak management 

on a locked behavioral health unit.’’ Am J Infect 

Control 2009;37:76–8. 

8 Ibid. 

Medicaid EHR Incentive programs) can 

effectively and efficiently help 

providers improve internal care delivery 

practices, support the exchange of 

important information across care 

partners and during transitions of care, 

and could enable the reporting of 

electronically specified clinical quality 

measures (eCQMs) (as described 

elsewhere in this rule). More 

information on the proposed rule on 

voluntary 2015 Edition EHR 

Certification, identification of EHR 

certification criteria and development of 

standards applicable to IPFQRs can be 

found at: 

• http://www.healthit.gov/policyresearchers-implementers/standardsand-certification-regulations 

• http://www.healthit.gov/facas/

FACAS/health-it-policy-committee/

hitpc-workgroups/certificationadoption 

• http://wiki.siframework.org/LCC+

LTPAC+Care+Transition+SWG 

• http://wiki.siframework.org/Long

itudinal+Coordination+of+Care 

We included the measure, ‘‘IPF Use of 

an Electronic Health Record Meeting 

Stage 1 or Stage 2 Meaningful Use 

Criteria’’ (now, ‘‘Use of an Electronic 

Health Record’’) in the ‘‘List of 

Measures under Consideration for 

December 1, 2013.’’ The measure would 

assess the degree to which facilities 

employ EHR systems in their service 

program and use such systems to 

support health information exchange at 

times of transitions in care. It is a 

structural measure that only requires the 

facility to attest to which one of the 

following statements best describes the 

facility’s highest level typical use of an 

EHR system (excluding the billing 

system) during the reporting period, and 

whether this use includes the exchange 

of interoperable health information with 

a health information service provider: 

a. The facility most commonly used 

paper documents or other forms of 

information exchange (e.g., email) NOT 

involving transfer of health information 

using EHR technology at times of 

transitions in care. 

b. The facility most commonly 

exchanged health information using 

non-certified EHR technology (i.e., not 

certified under the ONC HIT 

Certification Program) at times of 

transitions in care. 

c. The facility most commonly 

exchanged health information using 

certified EHR technology (certified 

under the ONC HIT Certification 

Program) at times of transitions in care. 

We would also ask IPFs to indicate 

whether transfers of health information 

at times of transitions in care included 

the exchange of interoperable health 

information with a health information 

service provider (HISP). 

In its 2014 report: 

(https://www.qualityforum.org/Work

Area/linkit.aspx?LinkIdentifier=id&Item

ID=74634), the MAP concluded that it 

does not support this measure because 

it does not adequately address any 

current needs of the program. The MAP 

noted that psychiatric hospitals were 

excluded from the EHR Incentive 

Programs and imposing the measure 

criteria is not realistic. The MAP also 

expressed concerns about using quality 

reporting programs to collect data on 

systems and infrastructure and 

suggested that the American Hospital 

Association’s survey of hospitals may be 

a better source for this type of data. 

We disagree with the MAP’s 

contention that the purpose of this 

measure is to collect data on systems 

and infrastructure. The purpose of the 

measure is to assess the use of processes 

for the collection, use, and transmission 

of medical information that have been 

demonstrated to impact the quality of 

care, rather than to collect data on 

systems and infrastructure. As we have 

described above, many studies 

document the benefits of EHR use on 

multiple dimensions related to health 

care quality, and to multiple goals of 

CMS’ quality strategy. Additionally, this 

is a structural measure that does not 

depend on systems for collecting and 

abstracting individual patient 

information and, therefore, is not 

burdensome on IPFs. Accordingly, we 

are proposing to adopt it as a measure 

for FY 2016 payment determination, a 

year earlier than for other measures 

proposed in this rule that are dependent 

on such systems. 

The Use of an Electronic Health 

Record proposed measure is not NQFendorsed. Section 1886(s)(4)(D)(ii) of the 

Act authorizes the Secretary to specify 

a measure that is not endorsed by the 

NQF as long as due consideration is 

given to measures that have been 

endorsed or adopted by a consensus 

organization identified by the Secretary. 

We attempted to find available measures 

that have been endorsed or adopted by 

a consensus organization and found no 

other feasible and practical measures on 

the topic of the degree to which 

facilities employ an EHR system in their 

program. Therefore, we believe that the 

Use of an Electronic Health Record 

proposed measure meets the measure 

selection exception requirement under 

section 1886(s)(4)(D)(ii) of the Act. 

c. Proposed Quality Measures for the FY 

2017 Payment Determination and 

Subsequent Years 

We are proposing to add four quality 

measures to the IPFQR Program for the 

FY 2017 payment determination and 

subsequent years: (1) Influenza 

Immunization (IMM–2); (2) Influenza 

Vaccination Coverage Among 

Healthcare Personnel; (3) Tobacco Use 

Screening (TOB–1); and (4) Tobacco Use 

Treatment Provided or Offered (TOB–2) 

and Tobacco Use Treatment (TOB–2a). 

1. Influenza Immunization (IMM–2) 

(NQF #1659) 

Increasing influenza (flu) vaccination 

can reduce unnecessary hospitalizations 

and secondary complications, 

particularly among high risk 

populations such as the elderly.4 Each 

year, approximately 226,000 people in 

the U.S. are hospitalized with 

complications from influenza, and 

between 3,000 and 49,000 die from the 

disease and its complications.5

Vaccination is the most effective 

method for preventing influenza virus 

infection and its potentially severe 

complications, and vaccination is 

associated with reductions in influenza 

among all age groups.6 The Advisory 

Committee on Immunization Practices 

(ACIP) recommends seasonal influenza 

vaccination for all persons six months of 

age and older, thereby stressing the 

importance of influenza prevention. 

Evidence from a Veteran’s Affairs 

locked behavioral psychiatric unit with 

26 patients and 40 staff during an 

influenza outbreak demonstrates 

significant room for improvement in 

vaccination rates among IPFs.7 In this 

study, 54 percent of the patients had not 

been vaccinated, and 36 percent of 

nonvaccinated patients manifested 

symptoms as compared with 25 percent 

of vaccinated patients.8 We believe that 

the adoption of a measure that assesses 

influenza immunization in the IPF 


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9Wilde J.A., McMillan J.A., Serwint J, et al. 

‘‘Effectiveness of influenza vaccine in healthcare 

professionals: A randomized trial.’’ JAMA 1999; 

281: 908–913. 

10Harriman K, Rosenberg J, Robinson S, et al. 

‘‘Novel influenza A (H1N1) virus infections among 

health-care personnel—United States, April-May 

2009.’’ Morb Mortal Wkly Rep. 2009; 58(23): 641– 

645. 

11Elder AG, O ́Donnell B, McCruden EA, et al. 

‘‘Incidence and recall of influenza in a cohort of 

Glasgow health-care workers during the 1993–4 

epidemic: Results of serum testing and 

questionnaire.’’ BMJ. 1996; 313:1241–1242. 

12Risa K.J., et al. ‘‘Influenza outbreak 

management on a locked behavioral health unit.’’ 

Am J Infect Control 2009;37:76–8. 

13 Ibid. 

setting not only works toward reducing 

the rate of influenza infection, but also 

affords consumers and others useful 

information in choosing among different 

facilities. 

We included the Influenza 

Immunization (NQF #1659) measure in 

the ‘‘List of Measures under 

Consideration for December 1, 2013.’’ 

The Influenza Immunization (IMM–2) 

chart-abstracted measure assesses 

inpatients, age 6 months and older, 

discharged during October, November, 

December, January, February, or March, 

who are screened for influenza 

vaccination status and vaccinated prior 

to discharge, if indicated. The 

numerator includes discharges that were 

screened for influenza vaccine status 

and were vaccinated prior to discharge, 

if indicated. The denominator includes 

inpatients, age 6 months and older, 

discharged during October, November, 

December, January, February, or March. 

The measure excludes patients who: 

Expire prior to hospital discharge or 

have an organ transplant during the 

current hospitalization; have a length of 

stay greater than 120 days; are 

transferred or discharged to another 

acute care hospital; or leave Against 

Medical Advice (AMA). We refer 

readers to https://

www.qualityforum.org/QPS/1659 for 

further technical specifications. 

The MAP gave conditional support for 

the measure, concluding that it is not 

ready for implementation because it 

needs more experience or testing. In its 

2014 final report, the MAP recognized 

that influenza immunization is 

important for healthcare personnel and 

patients, but cautioned that CDC and 

CMS need to collaborate on adjusting 

specifications for reporting from 

psychiatric units before the measure can 

be included in the IPFQR Program. CMS 

does not agree with this 

recommendation. Given previous 

experience with the use of this measure 

in inpatient settings and the clarity of 

specifications for it, CMS does not 

believe that additional experience or 

testing is needed before implementing 

this measure in IPFs, or that 

specifications need to be further 

adjusted for these facilities. We also 

believe that comments concerning 

collaboration with CDC largely apply to 

the following measure for influenza 

vaccination among healthcare 

personnel, which is explained in the 

discussion for that measure. 

We believe that the IMM–2 proposed 

measure meets the measure selection 

criterion under section 1886(s)(4)(D)(ii) 

of the Act. This section provides that, in 

the case of a specified area or medical 

topic determined appropriate by the 

Secretary for which a feasible and 

practical measure has not been endorsed 

by the entity with a contract under 

section 1890(a) of the Act, the Secretary 

may specify a measure that is not so 

endorsed as long as due consideration is 

given to measures that have been 

endorsed or adopted by a consensus 

organization identified by the Secretary. 

This measure is not NQF-endorsed in 

the IPF setting and we could not find 

any other comparable measure that is 

specifically endorsed for the IPF setting. 

However, we believe that this measure 

is appropriate for the assessment of the 

quality of care furnished by IPFs for the 

reasons discussed above. Further, this 

measure has been endorsed by NQF for 

the ‘‘Hospital/Acute care facility’’ 

setting. Although not explicitly 

endorsed for use in IPF settings, we 

believe that the characteristics of IPFs as 

distinct part units of hospitals or 

freestanding hospitals are similar 

enough to hospitals/acute care facilities 

that this measure may be appropriately 

used in such facilities. Finally, the 

adoption of this measure in the IPFQR 

Program aligns with the Hospital 

Inpatient Quality Reporting (HIQR) 

Program, which also includes this 

measure in its measure set. 

2. Influenza Vaccination Coverage 

Among HealthCare Personnel (NQF 

#0431) 

Healthcare personnel (HCP) can serve 

as vectors for influenza transmission 

because they are at risk for both 

acquiring influenza from patients and 

transmitting it to patients, and HCP 

often come to work when ill.9 An early 

report of HCP influenza infections 

during the 2009 H1N1 influenza 

pandemic estimated that 50 percent of 

infected HCP had contracted the 

influenza virus from patients or 

coworkers in the health care setting.10

Influenza virus infection is common 

among HCP, with evidence suggesting 

that nearly one-quarter of HCP were 

infected during influenza season, but 

few recalled having influenza.11 While 

it is difficult to precisely assess HCP 

influenza vaccination rates among IPFs 

because of varying state policies 

requiring hospitals to collect and report 

HCP vaccination coverage rates, 

evidence from a Veterans Affairs locked 

behavioral psychiatric unit with 26 

patients and 40 staff during an influenza 

outbreak demonstrates significant room 

for improvement.12 In this study, only 

55 percent of all staff had been 

vaccinated, and 22 percent of 

nonvaccinated staff manifested 

symptoms as compared with 18 percent 

of vaccinated staff.13 We believe that the 

adoption of a measure that assesses 

influenza vaccination among HCP in the 

IPF setting not only works toward 

improving the rate at which 

nonvaccinated HCPs manifest 

symptoms as compared with vaccinated 

HCPs, but also affords consumers and 

others useful information in choosing 

among different facilities. 

We included the Influenza 

Vaccination Coverage Among 

Healthcare Personnel (NQF #0431) 

measure in the ‘‘List of Measures under 

Consideration for December 1, 2013.’’ 

The proposed measure assesses the 

percentage of HCP who receive the 

influenza vaccination. The measure is 

designed to ensure that reported HCP 

influenza vaccination percentages are 

consistent over time within a single 

healthcare facility, as well as 

comparable across facilities. The 

numerator includes HCP in the 

denominator population who, during 

the time from October 1 (or when the 

vaccine became available) through 

March 31 of the following year: 

a. Received an influenza vaccination 

administered at the healthcare facility, 

or reported in writing (paper or 

electronic) or provided documentation 

that influenza vaccination was received 

elsewhere; or 

b. Were determined to have a medical 

contraindication/condition of severe 

allergic reaction to eggs or to other 

component(s) of the vaccine, or history 

of Guillain-Barre Syndrome within 6 

weeks after a previous influenza 

vaccination; or 

c. Declined influenza vaccination; or 

d. Had an unknown vaccination status 

or did not otherwise fall under any of 

the abovementioned numerator 

categories. 

The denominator includes the 

number of HCP working in the 

healthcare facility for at least one 

working day between October 1 and 

March 31 of the following year, 

regardless of clinical responsibility or 

patient contact, and is calculated 


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14Centers for Disease Control and Prevention. 

Annual Smoking-Attributable Mortality, Years of 

Potential Life Lost, and Productivity Losses— 

United States, 2000–2004.’’ Morb Mortal Wkly Rep. 

2008. 57(45): 1226–1228. Available at: http://

www.cdc.gov/mmwr/preview/mmwrhtml/

mm5745a3.htm. 

15U.S. Department of Health and Human 

Services. ‘‘The health consequences of smoking: A 

report of the Surgeon General.’’ Atlanta, GA, U.S. 

Department of Health and Human Services, Centers 

for Disease Control and Prevention, National Center 

for Chronic Disease Prevention and Health 

Promotion, Office on Smoking and Health, 2004. 

16Lasser K, Boyd JW, Woolhandler S, 

Himmelstein, D.U., McCormick D, Bor D.H. 

Smoking and mental illness: A population-based 

prevalence study. JAMA. 2000;284(20):2606–2610. 

17Centers for Disease Control and Prevention. 

‘‘Best Practices for Comprehensive Tobacco Control 

Programs—2007.’’ Atlanta, GA, Department of 

Health and Human Services, Centers for Disease 

Control and Prevention, National Center for Chronic 

Continued 

separately for employees, licensed 

independent practitioners, and adult 

students/trainees and volunteers. The 

measure has no exclusions. We refer 

readers to https://

www.qualityforum.org/QPS/0431 and 

the Centers for Disease Control and 

Prevention’s (CDC) Web site (http://

www.cdc.gov/nhsn/PDFs/HPS-manual/

vaccination/HPS-flu-vaccineprotocol.pdf) for further technical 

specifications. 

The MAP gave conditional support for 

the measure, concluding that it is not 

ready for implementation because it 

needs more experience or testing. In its 

2014 report, the MAP recognized that 

influenza immunization is important for 

healthcare personnel and patients, but 

cautioned that CDC and CMS need to 

collaborate on adjusting specifications 

for reporting from psychiatric units 

before the measure can be included in 

the IPFQR Program. CMS does not agree 

with this recommendation. As 

explained for the IMM–2 measure, given 

previous experience with the use of this 

measure and the clarity of its 

specifications, CMS does not believe 

that additional experience or testing is 

needed before implementing this 

measure in IPFs, or that specifications 

need to be further adjusted for these 

facilities. In response to comments 

concerning collaboration with CDC, 

CDC and CMS have conferred on this 

issue and language has been added to 

the description of this measure below 

that clarifies that IPFs will use the CDC 

National Healthcare Safety Network 

(NHSN) infrastructure and protocol to 

report the measure for IPFQR Program 

purposes. Neither CMS nor CDC 

believes that there are any coordination 

issues remaining for the implementation 

of this measure. 

We believe that the Influenza 

Vaccination Coverage Among 

HealthCare Personnel proposed measure 

meets the measure selection criterion 

under section 1886(s)(4)(D)(ii) of the 

Act. This section provides that, in the 

case of a specified area or medical topic 

determined appropriate by the Secretary 

for which a feasible and practical 

measure has not been endorsed by the 

entity with a contract under section 

1890(a) of the Act, the Secretary may 

specify a measure that is not so 

endorsed as long as due consideration is 

given to measures that have been 

endorsed or adopted by a consensus 

organization identified by the Secretary. 

This measure is not NQF-endorsed in 

the IPF setting and we could not find 

any other comparable measure that is 

specifically endorsed for the IPF setting. 

However, we believe that this measure 

is appropriate for the assessment of the 

quality of care furnished by IPFs for the 

reasons discussed above. Further, this 

measure has been endorsed by NQF for 

the ‘‘Hospital/Acute care facility’’ 

setting. Although not explicitly 

endorsed for use in IPF settings, we 

believe that the characteristics of IPFs as 

distinct part units of hospitals or 

freestanding hospitals mean that this 

measure may be appropriately used in 

such facilities. 

We propose that IPFs use the CDC 

National Healthcare Safety Network 

(NHSN) infrastructure and protocol to 

report the measure for IPFQR Program 

purposes. We propose that IPF reporting 

of HCP influenza vaccination summary 

data to NHSN would begin for the 2015– 

2016 influenza season, from October 1, 

2015, to March 31, 2016, with a 

reporting deadline of May 15, 2016. 

Although the collection period for this 

measure extends into the first quarter of 

the following calendar year, this 

measure data would be included with 

other measures that would be required 

for FY 2017 payment determination. 

Similarly, reporting for subsequent 

years would include results for the 

influenza season that begins in the last 

quarter of the applicable calendar year’s 

reporting. 

The adoption of this measure in 

IPFQR will align with both the HIQR 

and HOQR Programs. The Influenza 

Vaccination Coverage Among 

Healthcare Personnel (HCP) (NQF 

#0431) measure was finalized for the 

Hospital IQR program in the FY 2012 

IPPS/LTCH PPS final rule (76 FR 

51636), and the Hospital Outpatient 

Quality Reporting (HOQR) in the CY 

2014 OPPS/ASC final rule (78 FR 

75099), and the Ambulatory Surgical 

Center Quality Reporting (ASCQR) 

Program in the CY 2013 Hospital 

Outpatient Prospective Payment final 

rule (77 FR 68495). 

We are aware of public concerns 

about the burden of separately 

collecting healthcare personnel (HCP) 

influenza vaccination status across 

inpatient and outpatient settings, in 

particular, distinguishing between the 

inpatient and outpatient setting 

personnel for reporting purposes. We 

also understand that some are unclear 

about how the measure would be 

reported to CDC’s NHSN. 

We believe reporting a single 

vaccination count for each healthcare 

facility by each individual facility’s 

CMS Certification Number (CCN) would 

be less burdensome to IPFs than 

requiring them to distinguish between 

their inpatient and outpatient 

personnel. Therefore, we propose that, 

beginning with the 2015–2016 influenza 

season, IPFs would collect and report all 

HCP under each individual IPF’s CCN 

and submit this single number to CDC’s 

NHSN. Using the CCN would simplify 

data collection for healthcare facilities 

with multiple care settings. For each 

CMS CCN, a percentage of the HCP who 

received an influenza vaccination 

would be calculated and publically 

reported, so the public would know 

what percentage of the HCP have been 

vaccinated in each IPF. We believe this 

proposal would provide meaningful 

data that would help inform the public 

and healthcare facilities while 

improving the quality of care. Specific 

details on data submission for this 

measure can be found in an Operational 

Guidance available at: http://

www.cdc.gov/nhsn/acute-care-hospital/

hcp-vaccination/ and at http://

www.cdc.gov/nhsn/acute-care-hospital/

index.html. 

3. Tobacco Use Screening (TOB–1) 

(NQF #1651) 

Tobacco use is currently the single 

greatest cause of disease in the U.S., 

accounting for more than 435,000 

deaths annually.14 Smoking is a known 

cause of multiple cancers, heart disease, 

stroke, complications of pregnancy, 

chronic obstructive pulmonary disease, 

other respiratory problems, poorer 

wound healing, and many other 

diseases.15 This health issue is 

especially important for persons with 

mental illness and substance use 

disorders. One study has estimated that 

these individuals are twice as likely to 

smoke as the rest of the population, and 

account for nearly half of the total 

cigarette consumption in the U.S.16

Tobacco use also creates a heavy cost to 

both individuals and society. Smokingattributable health care expenditures are 

estimated at $96 billion per year in 

direct medical expenses and $97 billion 

in lost productivity.17


emcdonald on DSK67QTVN1PROD with PROPOSALS2
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Disease Prevention and Health Promotion, Office on 

Smoking and Health, 2007. 

18U.S. Department of Health and Human 

Services. ‘‘The health consequences of smoking: A 

report of the Surgeon General.’’ Atlanta, GA, U.S. 

Department of Health and Human Services, Centers 

for Disease Control and Prevention, National Center 

for Chronic Disease Prevention and Health 

Promotion, Office on Smoking and Health, 2004. 

19Prochaska, J.J., et al. ‘‘Efficacy of Initiating 

Tobacco Dependence Treatment in Inpatient 

Psychiatry: A Randomized Controlled Trial.’’ Am. 

J. Pub. Health. 2013 August 15; e1–e9. 

20 Ibid. 

21 Ibid. 

Strong and consistent evidence 

demonstrates that timely tobacco 

dependence interventions for patients 

using tobacco can significantly reduce 

the risk of suffering from tobacco-related 

disease, as well as provide improved 

health outcomes for those already 

suffering from a tobacco-related 

disease.18 Research demonstrates that 

tobacco users hospitalized with 

psychiatric illnesses who enter into 

treatment can successfully overcome 

their tobacco dependence.19 Evidence 

also suggests that tobacco cessation 

treatment does not increase, and may 

even decrease, the risk of 

rehospitalization for tobacco users 

hospitalized with psychiatric 

illnesses.20 Research further 

demonstrates that effective tobacco 

cessation support across the care 

continuum can be provided with only a 

minimal additional effort and without 

harm to the mental health recovery 

process.21 We believe that the adoption 

of a measure that assesses tobacco use 

screening among patients of IPFs 

encourages the uptake of tobacco 

cessation treatment and its attendant 

benefits. We further believe that the 

reporting of this measure would afford 

consumers and others useful 

information in choosing among different 

facilities. 

The Tobacco Use Screening (TOB–1) 

chart-abstracted proposed measure 

assesses hospitalized patients who are 

screened within the first three days of 

admission for tobacco use (cigarettes, 

smokeless tobacco, pipe, and cigar) 

within the previous 30 days. The 

numerator includes the number of 

patients who were screened for tobacco 

use status within the first 3 days of 

admission. The denominator includes 

the number of hospitalized inpatients 18 

years of age and older. The measure 

excludes patients who: Are less than 18 

years of age; are cognitively impaired; 

have a duration of stay less than or 

equal to 3 days, or greater than 120 

days; or have Comfort Measures Only 

documented. 

We refer readers to: http://

www.jointcommission.org/

specifications_manual_for_national_

hospital_inpatient_quality_

measures.aspx for further details on 

measure specifications. 

In the ‘‘List of Measure under 

Consideration for December 1, 2013,’’ 

we originally proposed a similar 

measure to that proposed here, which 

was ‘‘Preventive Care & Screening: 

Tobacco Use: Screening & Cessation 

Intervention (NQF 0028).’’ However, the 

MAP determined that this measure did 

not meet the needs of the program and 

instead recommended we adopt an 

alternate measure from the Joint 

Commissions suite of measures for 

inpatient settings, which we are now 

proposing. This measure, and the 

following one (TOB–2 and 2a), best 

reflect the activities encompassed by the 

original NQF 0028 measure. 

The proposed measure was NQFendorsed on March 7, 2014, and meets 

the measure selection criterion under 

section 1886(s)(4)(D)(i) of the Act. 

4. Tobacco Use Treatment Provided or 

Offered (TOB–2) and Tobacco Use 

Treatment (TOB–2a) (NQF #1654) 

As stated in our discussion of the 

proposed TOB–1 measure, tobacco use 

is currently the single greatest cause of 

disease in the U.S. We also indicated 

that research demonstrates that timely 

tobacco cessation treatment for 

hospitalized tobacco users with 

psychiatric illnesses may decrease the 

risk of rehospitalization, have only a 

minimal additional effort, and not harm 

the mental health recovery process. We 

believe that the adoption of a measure 

that assesses tobacco use screening 

treatment among IPFs encourages the 

uptake of tobacco cessation treatment 

and its attendant benefits. We further 

believe that the reporting of this 

measure would afford consumers and 

others useful information in choosing 

among different facilities. 

The Tobacco Use Treatment Provided 

or Offered (TOB–2) and Tobacco Use 

Treatment (TOB–2a) chart-abstracted 

proposed measure is reported as an 

overall rate that includes all patients to 

whom tobacco use treatment was 

provided, or offered and refused, and a 

second rate, a subset of the first, which 

includes only those patients who 

received tobacco use treatment. The 

overall rate, TOB–2, assesses patients 

identified as tobacco product users 

within the past 30 days who receive or 

refuse practical counseling to quit, and 

receive or refuse Food and Drug 

Administration (FDA)-approved 

cessation medications during the first 3 

days following admission. The 

numerator includes the number of 

patients who received or refused 

practical counseling to quit, and 

received or refused FDA-approved 

cessation medications during the first 3 

days after admission. 

The second rate, TOB–2a, assesses 

patients who received counseling and 

medication, as well as those who 

received counseling and had reason for 

not receiving the medication during the 

first 3 days following admission. The 

numerator includes the number of 

patients who received practical 

counseling to quit and received FDAapproved cessation medications during 

the first 3 days after admission. 

The denominator for both TOB–2 and 

TOB–2a includes the number of 

hospitalized inpatients 18 years of age 

and older identified as current tobacco 

users. The measure excludes patients 

who: Are less than 18 years of age; are 

cognitively impaired; are not current 

tobacco users; refused or were not 

screened for tobacco use during the 

hospital stay; have a duration of stay 

less than or equal to 3 days, or greater 

than 120 days; or have Comfort 

Measures Only documented. 

We refer readers to:http://

www.jointcommission.org/

specifications_manual_for_national_

hospital_inpatient_quality_

measures.aspx for further details on 

measure specifications. 

As with the proposed TOB–1 

measure, and for the same reasons, we 

are proposing this measure on the 

recommendation of the MAP. 

The proposed measure was NQFendorsed on March 7, 2014, and meets 

the measure selection criteria under 

section 1886(s)(4)(D)(i) of the Act. We 

also note that we are not proposing to 

adopt at this time two other tobacco 

treatment measures that are part of the 

set from which TOB–1, TOB–2 and 

TOB2a are taken. This is because the 

two measures we are proposing best 

encompass the activities that we 

originally proposed to measure through 

the use of the NQF 0028 measure, and 

best assess activities demonstrated to 

produce positive results in tobacco use 

reduction. Additionally, we believe that 

the other measures represent a 

significantly greater collection and 

reporting burden. We welcome 

comments on this choice as well as any 

other alternatives for measurement of 

this area. 

d. Summary of Proposed Measures 

In addition to the eight measures that 

we previously finalized for the IPFQR 

Program, we are proposing two 

additional new measures for reporting 

for the FY 2016 payment determination 

and subsequent years. We are also 

proposing four additional new measures 


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for the FY 2017 payment determination 

and subsequent years. The tables below 

list the proposed new measures for the 

FY 2016 and FY 2017 payment 

determinations and subsequent years. 

TABLE 13—PROPOSED NEW QUALITY MEASURES FOR THE IPFQR PROGRAM FOR FY 2016 PAYMENT DETERMINATION

AND SUBSEQUENT YEARS

National quality strategy priority NQF No. Measure ID Measure description 

Patient- and Caregiver-Centered Experience of Care .... N/A .............. N/A .............. Assessment of Patient Experience of Care. 

Effective Communication and Coordination of Care ...... N/A .............. N/A .............. Use of an Electronic Health Record. 

TABLE 14—PROPOSED NEW QUALITY MEASURES FOR THE IPFQR PROGRAM FOR FY 2017 PAYMENT DETERMINATION

AND SUBSEQUENT YEARS

National quality strategy priority NQF No. Measure ID Measure description 

Population/Community Health ......................................... 1659 ............ IMM–2 ......... Influenza Immunization. 

Population/Community Health ......................................... 0431 ............ N/A .............. Influenza Vaccination Coverage Among Healthcare 

Personnel. 

Clinical Quality of Care ................................................... 1651 ............ TOB–1 ......... Tobacco Use Screening.

Clinical Quality of Care ................................................... 1654 ............ TOB–2 .........

TOB–2a 

Tobacco Use Treatment Provided or Offered and Tobacco Use Treatment. 

We welcome public comments on the 

Assessment of Patient Experience of 

Care, Use of an Electronic Health 

Record, IMM–2, Influenza Vaccination 

Coverage Among Healthcare Personnel, 

TOB–1, and TOB–2 proposed measures. 

e. Additional Proposed Procedural 

Requirements for the FY 2017 Payment 

Determination and Subsequent Years 

In addition to the quality measures 

that we have described above, we are 

proposing that IPFs must, beginning 

with reporting for the FY 2017 payment 

determination, submit to CMS aggregate 

population counts for Medicare and 

non-Medicare discharges by age group, 

diagnostic group, and quarter, and 

sample size counts for measures for 

which sampling is performed (as is 

allowed for in HBIPS–4–7, and SUB–1). 

These requirements are separate from 

those described under subsection c of 

the section entitled ‘‘Form, Manner, and 

Timing of Quality Data Submission.’’ 

That subsection describes the 

population, sample size, and minimum 

reporting case threshold requirements 

for individual measures, while this 

section describes the collection of 

general population and sampling data 

that will assist in determining 

compliance with those requirements. 

We believe that it is vital for IPFs to 

accurately determine and submit to 

CMS their population and sampling size 

data in order for CMS to assess IPFs’ 

data reporting completeness for their 

total population, both Medicare and 

non-Medicare. In addition to helping us 

better assess the quality and 

completeness of measure data, we 

expect that this information will 

improve our ability to assess the 

relevance and impact of potential future 

measures. For example, understanding 

that the size of subgroups of patients 

addressed by a particular measure varies 

greatly over time could be helpful in 

assessing the stability of reported 

measure values, and subsequent 

decisions concerning measure retention. 

Similarly, better understanding of the 

size of particular subgroups in the 

overall population will assist us in 

making choices among potential future 

measures specific to a particular 

subgroup (e.g., those with depression). 

We further propose that the form, 

manner, and timing of this submission 

would follow the policies discussed at 

section VIII. of this preamble, and that 

failure to provide this information 

would be subject to the 2.0 percentage 

point reduction in the annual update for 

any IPF that does not comply with 

quality data submission requirements, 

pursuant to section 1886(s)(4)(A)(i) of 

the Act. 

f. Maintenance of Technical 

Specifications for Quality Measures 

We will provide a user manual that 

will contain links to measure 

specifications, data abstraction 

information, data submission 

information, a data submission 

mechanism known as the Web-based 

Measures Tool, and other information 

necessary for IPFs to participate in the 

IPFQR Program. This manual will be 

posted on the QualityNet Web site at: 

https://www.qualitynet.org/dcs/Content

Server?c=Page&pagename=Qnet

Public%2FPage%2FQnetTier2&cid=

1228772250192. We will maintain the 

technical specifications for the quality 

measures by updating this manual 

periodically and including detailed 

instructions for IPFs to use when 

collecting and submitting data on the 

required measures. These updates will 

be accompanied by notifications to 

IPFQR Program participants, providing 

sufficient time between the change and 

effective dates in order to allow users to 

incorporate changes and updates to the 

measure specifications into data 

collection systems. 

Many of the quality measures used in 

different Medicare and Medicaid 

reporting programs are endorsed by the 

National Quality Forum (NQF). As part 

of its regular maintenance process for 

endorsed performance measures, the 

NQF requires measure stewards to 

submit annual measure maintenance 

updates and undergo maintenance of 

endorsement review every 3 years. In 

the measure maintenance process, the 

measure steward (owner/developer) is 

responsible for updating and 

maintaining the currency and relevance 

of the measure and will confirm existing 

or minor specification changes with 

NQF on an annual basis. NQF solicits 

information from measure stewards for 

annual reviews, and it reviews measures 

for continued endorsement in a specific 

3-year cycle. 

We note that NQF’s annual or 

triennial maintenance processes for 

endorsed measures may result in the 

NQF requiring updates to the measures 

in order to maintain endorsement status. 

We believe that it is important to have 

in place a subregulatory process to 

incorporate nonsubstantive updates 

required by the NQF into the measure 

specifications we have adopted for the 

HAC Reduction Program, so that these 

measures remain up-to-date. 


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The NQF regularly maintains its 

endorsed measures through annual and 

triennial reviews, which may result in 

the NQF making updates to the 

measures. We believe that it is 

important to have in place a 

subregulatory process to incorporate 

non-substantive updates required by the 

NQF into the measure specifications we 

have adopted for the IPFQR Program so 

that these measures remain up-to-date. 

We also recognize that some changes the 

NQF might require to its endorsed 

measures are substantive in nature and 

might not be appropriate for adoption 

using a subregulatory process. 

Therefore, in the FY 2013 IPPS/LTCH 

PPS final rule (77 FR 53503 through 

53505), we finalized a policy under 

which we will use a subregulatory 

process to make only non-substantive 

updates to measures used for the IPFQR 

Program (77 FR 53653). With respect to 

what constitutes substantive versus nonsubstantive changes, we expect to make 

this determination on a case-by-case 

basis. Examples of non-substantive 

changes to measures might include 

updated diagnosis or procedure codes, 

medication updates for categories of 

medications, broadening of age ranges, 

and exclusions for a measure (such as 

the addition of a hospice exclusion to 

the 30-day mortality measures). We 

believe that non-substantive changes 

may include updates to NQF-endorsed 

measures based upon changes to 

guidelines upon which the measures are 

based. As stated in the FY 2013 IPPS/ 

LTCH PPS final rule, we will revise the 

manual so that it clearly identifies the 

updates and provides links to where 

additional information on the updates 

can be found. We will also post the 

updates on the QualityNet Web site at 

https://www.QualityNet.org. We will 

provide 6 months for facilities to 

implement changes where changes to 

the data collection systems would be 

necessary. 

We will continue to use rulemaking to 

adopt substantive updates required by 

the NQF to the endorsed measures we 

have adopted for the IPFQR Program. 

Examples of changes that we might 

consider to be substantive would be 

those in which the changes are so 

significant that the measure is no longer 

the same measure, or when a standard 

of performance assessed by a measure 

becomes more stringent (for example: 

Changes in acceptable timing of 

medication, procedure/process, or test 

administration). Another example of a 

substantive change would be where the 

NQF has extended its endorsement of a 

previously endorsed measure to a new 

setting, such as extending a measure 

from the inpatient setting to hospice. 

These policies regarding what is 

considered substantive versus nonsubstantive would apply to all measures 

in the IPFQR Program. We also note that 

the NQF process incorporates an 

opportunity for public comment and 

engagement in the measure maintenance 

process. 

We believe this policy adequately 

balances our need to incorporate 

technical updates to all IPFQR Program 

measures in the most expeditious 

manner possible while preserving the 

public’s ability to comment on updates 

that so fundamentally change an 

endorsed measure that it is no longer 

the same measure that we originally 

adopted. We invite public comments on 

this proposal. 

6. New Quality Measures for Future 

Years 

As we have previously indicated, we 

seek to develop a comprehensive set of 

quality measures to be available for 

widespread use for informed decisionmaking and quality improvement in the 

inpatient psychiatric facilities setting. 

Therefore, through future rulemaking, 

we intend to propose new measures that 

will help further our goal of achieving 

better health care and improved health 

for Medicare beneficiaries who obtain 

inpatient psychiatric services through 

the widespread dissemination and use 

of quality information. 

As part of the 2013 Measures under 

Consideration (http://www.quality

forum.org/Setting_Priorities/

Partnership/Measures_Under_

Consideration_List.aspx), we identified 

ten possible measures for the IPFQR 

Program. We have proposed four of 

these measures for adoption in this 

proposed rule. Five of the measures are 

currently undergoing testing, and we 

anticipate that one or more would be 

proposed for adoption in the near 

future. These measures are: 

• Suicide Risk Screening completed 

within one day of admission 

• Violence Risk Screening completed 

within one day of admission 

• Drug Use Screening completed within 

one day of admission 

• Alcohol Use Screening completed 

within one day of admission 

• Metabolic Screening 

We also are currently planning to 

develop a 30-day psychiatric 

readmission measure. Similar to 

readmission measures currently in use 

for other CMS quality reporting 

programs such as the Hospital Inpatient 

Quality Reporting Program, we envision 

that this measure would encompass all 

30-day readmissions for discharges from 

IPFs, including readmissions for nonpsychiatric diagnoses. Additionally, we 

intend to develop a standardized survey 

of patient experience of care tailored for 

use in inpatient psychiatric settings, but 

also sharing elements with similar 

surveys in use in other CMS reporting 

programs. 

We further anticipate that we will 

recommend additional measures for 

development or adoption in the future. 

We intend to develop a measure set that 

effectively assesses IPF quality across 

the range of services and diagnoses, 

encompasses all of the goals of the CMS 

quality strategy, addresses measure gaps 

identified by the MAP and others, and 

minimizes collection and reporting 

burden. Finally, we may propose the 

removal of some measures in the future, 

should one or more no longer reflect 

significant variation in quality among 

IPFs, or prove to be less effective than 

alternative measures in measuring the 

intended focus area. 

We welcome public comments on any 

aspect of these plans for measure 

development, recommendations for 

adoption of other measures for the 

IPFQR Program, particularly related to 

measures of access, or suggestions for 

domains or topics for future measure 

development. 

7. Proposed Public Display and Review 

Requirements 

Section 1886(s)(4)(E) of the Act 

requires the Secretary to establish 

procedures for making the data 

submitted under the IPFQR Program 

available to the public. The statute also 

requires that these procedures shall 

ensure that an IPF has the opportunity 

to review the data that is to be made 

public with respect to the IPF prior to 

the data being made public. 

In the FY 2014 IPPS/LTCH PPS final 

rule (78 FR 50897 through 50898), we 

adopted our proposal to change our 

policies to better align the IPFQR 

Program preview and display periods 

with those under the Hospital IQR 

Program. For the FY 2014 payment 

determination and subsequent years, we 

adopted our proposed policy to publicly 

display the submitted data on a CMS 

Web site in April of each calendar year 

following the start of the respective 

payment determination year. In other 

words, the public display period for the 

FY 2014 payment determination would 

be April 2014; the public display 

periods for the FY 2015 and FY 2016 

payment determinations would be April 

2015 and April 2016 respectively, and 

so forth. We also adopted our proposed 

policy that the preview period for the 

FY 2014 payment determination and 

subsequent years be modified from 


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September 20 through October 19 (78 

FR 50898) to 30 days, approximately 

twelve weeks prior to the public display 

of the data. The table below sets out the 

public display timeline. 

TABLE 15—PUBLIC DISPLAY TIMELINE

Payment determination 

(fiscal year) 

Reporting period 

(calendar year) 

Public display 

(calendar year) 

2015 ................................................ Q2 2013 (April 1, 2013–June 30, 2013) .............................................................................

Q3 2013 (July 1, 2013–September 30, 2013). 

Q4 2013 (October 1, 2013–December 31, 2013). 

April 2015. 

2016 ................................................ Q1 2014 (January 1, 2014–March 31, 2014) .....................................................................

Q2 2014 (April 1, 2014–June 30, 2014). 

Q3 2014 (July 1, 2014–September 30, 2014). 

Q4 2014 (October 1, 2014–December 31, 2014). 

April 2016. 

2017 ................................................ Q1 2015 (January 1, 2015–March 31, 2015) .....................................................................

Q2 2015 (April 1, 2015–June 30, 2015). 

Q3 2015 (July 1, 2015–September 30, 2015). 

Q4 2015 (October 1, 2015–December 31, 2015). 

April 2017. 

Although we have listed the public 

display timeline only for the FY 2015 

through FY 2017 payment 

determinations, we wish to clarify that 

this policy applies to the FY 2015 

payment determination and subsequent 

years. We are not proposing any changes 

to these policies. 

8. Form, Manner, and Timing of Quality 

Data Submission 

a. Procedural and Submission 

Requirements 

Section 1886(s)(4)(C) of the Act 

requires that, for the FY 2014 payment 

determination and subsequent years, 

each IPF shall submit to the Secretary 

data on quality measures as specified by 

the Secretary. Such data shall be 

submitted in a form and manner, and at 

a time, specified by the Secretary. As 

required by section 1886(s)(4)(A) of the 

Act, for any IPF that fails to submit 

quality data in accordance with section 

1886(s)(4)(C) of the Act, the Secretary 

will reduce the annual update to a 

standard Federal rate for discharges 

occurring in such fiscal year by 2.0 

percentage points. In the FY 2013 IPPS/ 

LTCH PPS final rule (77 FR 53655 

through 53656), we finalized a policy 

requiring that IPFs submit aggregate 

data on measures on an annual basis via 

the Web-Based Measures Tool found in 

the IPF section on the QualityNet Web 

site. The complete data submission 

requirements, submission deadlines, 

and data submission mechanism, 

known as the Web-Based Measures 

Tool, are posted on the QualityNet Web 

site at: http://www.qualitynet.org/. The 

data input forms on the QualityNet Web 

site for submission require aggregate 

data for each separate quarter. 

Therefore, IPFs need to track and 

maintain quarterly records for their 

data. In that final rule, we also clarified 

that this policy applies to all subsequent 

years, unless and until we change our 

policy through future rulemaking. 

In order to participate in the IPFQR 

Program, in the FY 2013 IPPS/LTCH 

PPS final rule (77 FR 53654 through 

53655) and in the FY 2014 IPPS/LTCH 

PPS final rule (77 FR 50898 through 

50899), we required IPFs to comply 

with certain procedural requirements. 

We refer readers to the FY 2014 IPPS/ 

LTCH PPS final rule (77 FR 50898 

through 50899) for further details on 

specific procedural requirements. 

We are not proposing any changes to 

this policy. 

b. Reporting Periods and Submission 

Timeframes 

In the FY 2013 IPPS/LTCH PPS final 

rule (77 FR 53655 through 53657), we 

established reporting periods and 

submission timeframes for the FY 2014, 

FY 2015, and FY 2016 payment 

determinations, but we did not require 

any data validation approach. However, 

as we stated in that final rule, we 

encourage IPFs to use a validation 

method and conduct their own analysis. 

In that final rule, we also explained that 

the reporting periods for the FY 2014 

and FY 2015 payment determinations 

were 6 and 9 months, respectively, to 

allow us to achieve a 12-month 

(calendar year) reporting period for the 

FY 2016 payment determination. In the 

FY 2014 IPPS/LTCH PPS final rule (78 

FR 50901), we clarified that the policy 

we adopted for the FY 2016 payment 

determination also applies to the FY 

2017 payment determination and 

subsequent years unless we change it 

through rulemaking. We also indicated 

that the submission timeframe is 

between July 1 and August 15 of the 

calendar year in which the applicable 

payment determination year begins. 

We are not proposing any changes to 

this submission timeframe, which we 

finalized in the FY 2014 IPPS/LTCH 

PPS final rule for all future payment 

determinations. IPFs will have the 

opportunity to review and correct data 

that they have submitted during the 

entirety of July 1–August 15. We have 

summarized this information in the 

table below. 

TABLE 16—QUALITY REPORTING PERIODS AND SUBMISSION TIMEFRAMES FOR THE FY 2015 PAYMENT DETERMINATION

AND SUBSEQUENT YEARS

Payment determination 

(fiscal year) 

Reporting period for services provided 

(calendar year) Data submission timeframe 

Quality Reporting Periods and Submission Timeframes for the FY 2015 Payment Determination and Subsequent Years 

FY 2015 ................................... Q2 2013 (April 1, 2013–June 30, 2013) ...........................................................

Q3 2013 (July 1, 2013–September 30, 2013). 

Q4 2013 (October 1, 2013–December 31, 2013). 

July 1, 2014–August 15, 2014. 


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TABLE 16—QUALITY REPORTING PERIODS AND SUBMISSION TIMEFRAMES FOR THE FY 2015 PAYMENT DETERMINATION

AND SUBSEQUENT YEARS—Continued 

Payment determination 

(fiscal year) 

Reporting period for services provided 

(calendar year) Data submission timeframe 

FY 2016 ................................... Q1 2014 (January 1, 2014–March 31, 2014) ...................................................

Q2 2014 (April 1, 2014–June 30, 2014). 

Q3 2014 (July 1, 2014–September 30, 2014). 

Q4 2014 (October 1, 2014–December 31, 2014). 

July 1, 2015–August 15, 2015. 

FY 2017 ................................... Q1 2015 (January 1, 2015–March 31, 2015) ...................................................

Q2 2015 (April 1, 2015–June 30, 2015). 

Q3 2015 (July 1, 2015–September 30, 2015). 

Q4 2015 (October 1, 2015–December 31, 2015). 

July 1, 2016–August 15, 2016. 

We have adopted the timeframes 

discussed above for all future payment 

years of the program, and these 

timeframes will remain in place unless 

and until we change them through 

future rulemaking. Therefore, our policy 

with respect to reporting timeframes is 

that the reporting period is the calendar 

year preceding the calendar year in 

which the payment determination year 

begins. The data submission timeframe 

is between July 1 and August 15 of the 

calendar year in which the applicable 

payment determination year begins. We 

will continue to provide charts with the 

specific reporting and data submission 

timeframes for future years as we 

approach those years. 

c. Population, Sampling, and Minimum 

Case Threshold 

In the FY 2013 IPPS/LTCH PPS final 

rule (77 FR 53657 through 53658), for 

the FY 2014 payment determination and 

subsequent years, we finalized our 

proposed policy that participating IPFs 

must meet specific population, sample 

size, and minimum reporting case 

threshold requirements as specified in 

TJC’s Specifications Manual. We refer 

readers to the FY 2014 IPPS/LTCH PPS 

final rule (78 FR 58901 through 58902). 

We are not proposing any changes to 

this policy. We refer participating IPFs 

to TJC’s Specifications Manual (https:// 

manual.jointcommission.org/bin/view/ 

Manual/WebHome) for measure-specific 

population, sampling, and minimum 

case threshold requirements. 

d. Data Accuracy and Completeness 

Acknowledgement (DACA) 

Requirements 

In the FY 2013 IPPS/LTCH PPS final 

rule (77 FR 53658), we finalized our 

proposed DACA policy for the FY 2014 

payment determination and subsequent 

years. We refer readers to that final rule 

for further details on DACA policies. 

We are not proposing any changes to 

the quarterly reporting periods and 

DACA deadline. Therefore, we will 

continue our adopted policy that the 

deadline for submission of the DACA 

form is no later than August 15 prior to 

the applicable IPFQR Program payment 

determination year. The table below 

summarizes these policies and 

timeframes. 

TABLE 17—DACA SUBMISSION DEADLINE

Payment 

determination 

(fiscal year) 

Reporting period for services provided 

(calendar year) 

Submission 

timeframe 

DACA 

deadline 

Public 

display 

2015 .................. Q2 2013 (April 1, 2013–June 30, 2013) .....................

Q3 2013 (July 1, 2013–September 30, 2013). 

Q4 2013 (October 1, 2013–December 31, 2013). 

July 1, 2014–August 15, 2014 ....... August 15, 2014 April 2015. 

2016 .................. Q1 2014 (January 1, 2014–March 31, 2014) .............

Q2 2014 (April 1, 2014–June 30, 2014). 

Q3 2014 (July 1, 2014–September 30, 2014). 

Q4 2014 (October 1, 2014–December 31, 2014). 

July 1, 2015–August 15, 2015 ....... August 15, 2015 April 2016. 

2017 .................. Q1 2015 (January 1, 2015–March 31, 2015) .............

Q2 2015 (April 1, 2015–June 30, 2015). 

Q3 2015 (July 1, 2015–September 30, 2015). 

Q4 2015 (October 1, 2015–December 31, 2015). 

July 1, 2016–August 15, 2016 ....... August 15, 2016 April 2017. 

We would like to clarify that the 

DACA policies adopted in the FY 2013 

IPPS/LTCH PPS final rule will continue 

to apply for the FY 2014 payment 

determination and subsequent years 

unless and until we change these 

policies through our rulemaking 

process. 

9. Reconsideration and Appeals 

Procedures 

In the FY 2013 IPPS/LTCH PPS final 

rule (77 FR 53658 through 53659), we 

adopted a reconsideration process, later 

codified at 42 CFR 412.434, whereby 

IPFs can request a reconsideration of 

their payment update reduction in the 

event that an IPF believes that its annual 

payment update has been incorrectly 

reduced for failure to report quality data 

under the IPFQR Program. We refer 

readers to that final rule, as well as the 

FY 2014 IPPS/LTCH PPS final rule (78 

FR 50903), for further details on the 

reconsideration process. 

10. Exceptions to Quality Reporting 

Requirements 

In our experience with other quality 

reporting and/or performance programs, 

we have noted occasions where 

participants have been unable to submit 

required quality data due to 

extraordinary circumstances that are not 

within their control (for example, 

natural disasters). It is our goal to avoid 

penalizing IPFs in these circumstances 

or unduly increasing their burden 

during these times. Therefore, in the FY 

2013 IPPS/LTCH PPS final rule (77 FR 


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53659 through 53660), we adopted a 

policy that, for the FY 2014 payment 

determination and subsequent years, 

IPFs may request, and we may grant, an 

exception with respect to the reporting 

of required quality data where 

extraordinary circumstances beyond the 

control of the IPF may warrant. We wish 

to clarify that use of the term 

‘‘exception’’ in this proposed rule is 

synonymous with the term ‘‘waiver’’ as 

used in previous rules. We are in the 

process of revising the Extraordinary 

Circumstances/Disaster Extension or 

Waiver Request form (CMS–10432), 

approved under OMB control number 

0938–1171. Revisions to the form are 

being addressed in the FY 2015 

Inpatient Prospective Payment System 

(IPPS) rule (RIN 0938–AS11; CMS– 

1607–P) in the section entitled 

‘‘Hospital IQR Program Extraordinary 

Circumstances Extensions or 

Exemptions’’. These efforts will work to 

facilitate alignment across CMS quality 

reporting programs. 

When an exception is granted, IPFs 

will not incur payment reductions for 

failure to comply with IPFQR Program 

requirements. This process does not 

preclude us from granting exceptions, 

including extensions, to IPFs that have 

not requested them, should we 

determine that an extraordinary 

circumstance affects an entire region or 

locale. We refer readers to the FY 2013 

IPPS/LTCH PPS final rule (77 FR 53659 

through 53660), as well as the FY 2014 

IPPS/LTCH PPS final rule (78 FR 

50903), for further details on this 

process. We are not proposing any 

changes to this process. 

For the FY 2016 payment 

determination and subsequent years, we 

are proposing to add an Extraordinary 

Circumstances Exception to the IPFQR 

Program in order to align with similar 

exceptions provided for in other CMS 

quality reporting programs. Under this 

exception, we are proposing that we 

may grant a waiver or extension to IPFs 

if we determine that a systemic problem 

with one of our data collection systems 

directly affects the ability of the IPFs to 

submit data. Because we do not 

anticipate that these types of systemic 

errors will occur often, we do not 

anticipate granting a waiver or 

extension on this basis frequently. If we 

make the determination to grant a 

waiver or extension, we are proposing to 

communicate this decision through 

routine communication channels to 

IPFs, vendors, and quality improvement 

organizations (QIOs) by means of, for 

example, memoranda, emails, and 

notices on the QualityNet Web site. 

We welcome public comment on this 

proposal. 

IX. Collection of Information 

Requirements 

Under the Paperwork Reduction Act 

of 1995, we 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: 

• The need for the information 

collection and its usefulness in carrying 

out the proper functions of our agency. 

• The accuracy of our estimate of the 

information collection burden. 

• The quality, utility, and clarity of 

the information to be collected. 

• Recommendations to minimize the 

information collection burden on the 

affected public, including automated 

collection techniques. 

We are soliciting public comment on 

each of the section 3506(c)(2)(A)- 

required issues for the following 

information collection requirements 

(ICRs): 

A. ICRs Regarding the Inpatient 

Psychiatric Facilities Quality Reporting 

(IPFQR) Program 

This section IX.A sets out the 

estimated burden (hours and cost) for 

inpatient psychiatric facilities (IPFs) to 

comply with the reporting requirements 

proposed in this NPRM. It also restates 

the burden estimated in the FY 2013 

and FY 2014 IPPS/LTCH PPS final 

rules. 

In the FY 2013 IPPS/LTCH PPS final 

rule (77 FR 53644), we finalized policies 

to implement the IPFQR Program. The 

Program implements the statutory 

requirements of section 1886(s)(4) of the 

Social Security Act, as added by 

sections 3401(f) and 10322(a) of the 

Affordable Care Act. One program 

priority is to help achieve better health 

and better health care for individuals 

through the collection of valid, reliable, 

and relevant measures of quality health 

care data. The data will be publicly 

posted and, therefore, available for use 

in improving health care quality which, 

in turn, works to further program goals. 

IPFs can use this quality data for many 

purposes, including in their risk 

management programs, patient safety 

and quality improvement initiatives, 

and research and development of 

mental health programs, among others. 

As clarified throughout the FY 2014 

IPPS/LTCH PPS final rule (78 FR 

50887), policies finalized in prior rules 

will apply to FY 2015 unless and until 

we change them through future 

rulemaking. The burden on IPFs 

includes the time used for chart 

abstraction and for personnel training 

on the collection of chart-abstracted 

data, the aggregation of data, as well as 

training for the submission of aggregatelevel data through QualityNet. We note 

that, beginning in the FY 2016 payment 

determination, as set out in this 

proposed rule, we have proposed to 

adopt the Assessment of Patient 

Experience of Care measure, thereby 

removing the request for voluntary 

information adopted in the FY 2014 

IPPS/LTCH PPS final rule. 

Based on current participation rates, 

we estimate that there will be 

approximately 574 fewer IPF facilities 

(or 1,626 facilities) nationwide eligible 

to participate in the IPFQR Program. 

Based on previous measure data 

submission, we further estimate that the 

average facility submits measure data on 

556 cases per year. In total, this 

calculates to 904,056 cases (aggregate) 

per year. 

In section V of this preamble, we are 

proposing that, for the FY 2016 payment 

determination and subsequent years, 

IPFs must submit data on the following 

proposed new measures: Assessment of 

Patient Experience of Care, and Use of 

an Electronic Health Record. Because 

both of these measures require only an 

annual acknowledgement, we anticipate 

a negligible additional burden on IPFs. 

In the same section of this preamble, 

we are proposing that, for the FY 2017 

payment determination and subsequent 

years, IPFs must submit aggregate data 

on the following proposed new 

measures: Influenza Immunization 

(IMM–2), Influenza Vaccination 

Coverage Among Healthcare Personnel, 

Tobacco Use Screening (TOB–1), and 

Tobacco Use Treatment Provided or 

Offered (TOB–2) and Tobacco Use 

Treatment (TOB–2a). 

We estimate that the average time 

spent for chart abstraction per patient 

for each of these proposed measures is 

approximately 15 minutes. Assuming an 

approximately uniform sampling 

methodology, we estimate (based on 

prior Program data) that the annual 

burden for reporting the IMM–2 

measure would be 139 hours per year of 

annual effort per facility (556 × 0.25). 

This same calculation also applies to the 

TOB–1, and TOB–2 and TOB–2a 

proposed measures. The Influenza 

Vaccination Coverage Among 

Healthcare Personnel proposed measure 

does not allow sampling; therefore, we 

anticipate that the average facility 

would be required to abstract 

approximately 40 healthcare personnel, 


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totaling an annual effort per facility of 

10 hours (40 × 0.25). We anticipate no 

measurable burden for the Inpatient 

Psychiatric Facility Routinely Assesses 

Patient Experience of Care measure and 

the Use of an Electronic Health Record 

measure because both require only 

attestation. 

In total, for proposed measures, we 

estimate an additional 427 hours of 

annual effort per facility for the FY 2017 

payment determination and subsequent 

years. The following table summarizes 

the estimated hours (per facility) for 

each measure. 

TABLE 18—ESTIMATED ANNUAL EFFORT PER FACILITY

Measure 

Estimated 

cases 

(per facility) 

Effort 

(per case) 

Annual effort 

(per facility) 

Assessment of Patient Experience of Care .......................................................................... * 0 * n/a * 0 

Use of an Electronic Health Record ...................................................................................... * 0 * n/a * 0 

IMM–2 .................................................................................................................................... 556 ** 1⁄4 139 

Influenza Vaccination Coverage Among Healthcare Personnel ........................................... 40 ** 1⁄4 10 

TOB–1 .................................................................................................................................... 556 ** 1⁄4 139 

TOB–2, TOB–2a .................................................................................................................... 556 ** 1⁄4 139 

Total ................................................................................................................................ .............................. ........................ 427 

* New non-measurable attestation burden. 

** Hour. 

The Bureau of Labor Statistics wage 

estimate for health care workers that are 

known to engage in chart abstraction is 

$31.71/hour. To account for overhead 

and fringe benefits we have doubled this 

estimate to $63.42/hour. Considering 

the 427 hours of annual effort (per 

facility) for the FY 2017 payment 

determination and subsequent years, the 

annual cost is approximately $27,080.34 

(63.42 × 427). Across all 1,626 IPFs, the 

aggregate total is $44,032,632.84 (1,626 

× 27,080.34). 

The estimated burden for training 

personnel for data collection and 

submission for current and future 

measures is 2 hours per facility. The 

cost for this training, based on an hourly 

rate of $63.42, is $126.84 training costs 

for each IPF (63.42 × 2), which totals 

$206,241.84 for all facilities (1,626 × 

126.84). 

Using an estimated 1,626 IPFs 

nationwide that are eligible for 

participation in the IPFQR Program, we 

estimate that the annual hourly burden 

for the collection, submission, and 

training of personnel for submitting all 

quality measures is approximately 429 

hours (per IPF) or 697,554 (aggregate) 

per year. The all-inclusive measure cost 

for each facility is approximately 

$27,207.18 (27,080.34 + 126.84) and for 

all facilities we estimate a cost of 

$44,238,874.68 (44,032,632.84 + 

206,241.84). 

In section V of this preamble, for the 

FY 2017 payment determination, we are 

proposing that IPFs submit to CMS 

aggregate population counts for 

Medicare and non-Medicare discharges 

by age group, diagnostic group, and 

quarter, and sample size counts for 

measures for which sampling is 

performed (as is allowed for in HBIPS– 

4 through–7, and SUB–1). We estimate 

that it will take each facility 

approximately 2.5 hours to comply with 

this requirement. The burden across all 

1,626 IPFs calculates to 4,065 hours 

annually (2.5 × 1,626) at a total of 

$257,802.30 (4,065 × 63.42) or $158.55 

per IPF (2.5 × 63.42). 

The following tables set out the total 

estimated burden that IPFs would incur 

to comply with the proposed reporting 

requirements for both measure and nonmeasure data for the FY 2016 and FY 

2017 payment determinations. 

TABLE 19—SUMMARY OF BURDEN ESTIMATES (OFFICE OF MANAGEMENT AND BUDGET CONTROL NUMBER 0938–1171, 

CMS–10432) FOR THE FY 2016 PAYMENT DETERMINATION

Fiscal year 2016 Number of 

measures Respondents 

Facility 

burden 

(hours) 

Total annual 

burden 

(hours) 

Labor cost 

of reporting 

($/hr) 

Total cost 

($) 

From this FY 2015 proposed 

rule.

2 (attestation only) .................. 1,626 0 0 0 0 

training .................................... 1,626 0 0 0 0 

Total ................................. ................................................. 1,626 0 0 0 0 

TABLE 20—SUMMARY OF BURDEN ESTIMATES (OFFICE OF MANAGEMENT AND BUDGET CONTROL NUMBER 0938–1171, 

CMS–10432) FOR THE FY 2017 PAYMENT DETERMINATION

Fiscal year 2017 Number of 

measures Respondents Facility burden (hours) 

Total annual 

burden 

(hours) 

Labor 

cost of 

reporting 

($/hr) 

Total cost 

($) 

From this FY 2015 proposed rule.4 .................................... 1,626 427 (139 × 3 + 10) 694,302 63.42 44,032,632.84 

2 (attestation only) ........ ........................ ........................................ 0 .................... ........................

training .......................... ........................ 2 3,252 .................... 206,241.84 


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TABLE 20—SUMMARY OF BURDEN ESTIMATES (OFFICE OF MANAGEMENT AND BUDGET CONTROL NUMBER 0938–1171, 

CMS–10432) FOR THE FY 2017 PAYMENT DETERMINATION—Continued 

Fiscal year 2017 Number of 

measures Respondents Facility burden (hours) 

Total annual 

burden 

(hours) 

Labor 

cost of 

reporting 

($/hr) 

Total cost 

($) 

Subtotal .................. ....................................... 1,626 429 697,554 63.42 44,238,874.68 

From this FY 2015 proposed rule.Non-measure data ........ 1,626 2.50 4,065 63.42 257,802.30 

Total ................ ....................................... 1,626 431.50 701,619 63.42 44,496,676.98 

We are not proposing any changes to 

the administrative, reporting, or 

submission requirements for the 

measures previously finalized in the FY 

2013 IPPS/LTCH PPS final rule (77 FR 

53654 through 53657) and the FY 2014 

IPPS/LTCH PPS final rule (78 FR 50898 

through 50903), except that we are 

removing the Request for Voluntary 

Information—IPF Assessment of Patient 

Experience of Care section because of 

the Assessment of Patient Experience of 

Care proposed measure. 

B. Summary of Proposed Burden 

Adjustments (OCN 0938–1171, CMS– 

10432) 

In the FY 2014 final rule (78 FR 

50964), we estimated that the annual 

hourly burden per IPF for the collection, 

submission, and training of personnel 

for submitting all quality measures was 

approximately 761 hours. This figure 

represented an estimate for all 

measures, both previously and newly 

finalized, in the Program. We further 

stated that because we were unable to 

estimate how many IPFs will 

participate, we could not estimate the 

aggregate impact. 

Because the estimates we present 

herein, including the estimated annual 

burden of 431.5 hours per IPF, represent 

estimates only for proposed measures 

and non-measure data collection and 

submission requirements, an accurate 

comparison with estimates presented in 

the FY 2014 final rule is not possible. 

C. ICRs Regarding the Hospital and 

Health Care Complex Cost Report 

(CMS–2552–10) 

This proposed rule would not impose 

any new or revised collection of 

information requirements associated 

with CMS–2552–10 (as discussed under 

preamble section IV.B.). Consequently, 

the cost report does not require 

additional OMB review under the 

authority of the Paperwork Reduction 

Act of 1995 (44 U.S.C. 3501 et seq.). The 

report’s information collection 

requirements and burden estimates have 

been approved by OMB under OCN 

0938–0052. 

D. ICRs Regarding Exceptions to Quality 

Reporting Requirements 

As discussed in section VIII.10 of this 

preamble, we are in the process of 

revising the Extraordinary 

Circumstances/Disaster Extension or 

Waiver Request form, currently 

approved under OMB control number 

0938–1171. Revisions to the form are 

being addressed in the FY 2015 

Inpatient Prospective Payment System 

rule (RIN 0938–AS11, CMS–1607–P). In 

that rule we propose to update the 

form’s instructions and simplify the 

form so that a hospital or facility may 

apply for an extension for all applicable 

quality reporting programs at the same 

time. 

E. Submission of PRA-Related 

Comments 

We have submitted a copy of this 

proposed rule to OMB for its review of 

the rule’s information collection and 

recordkeeping requirements. These 

requirements are not effective until they 

have been approved by the OMB. 

To obtain copies of the supporting 

statement and any related forms for the 

proposed paperwork collections 

referenced above, access CMS’ Web site 

at http://www.cms.gov/Medicare/CMSForms/CMS-Forms/index.html, or call 

the Reports Clearance Office at 410– 

786–1326. 

We invite public comments on these 

potential information collection 

requirements. If you comment on these 

information collection and 

recordkeeping requirements, please 

submit your comments electronically as 

specified in the ADDRESSES section of 

this proposed rule. 

PRA-related comments must be 

received on/by July 7, 2014. 

X. Response to Comments 

Because of the large number of public 

comments we normally receive on 

Federal Register documents, 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, when we proceed 

with a subsequent document, we will 

respond to the comments in the 

preamble to that document. 

XI. Regulatory Impact Analysis 

A. Statement of Need 

This proposed rule would update the 

prospective payment rates for Medicare 

inpatient hospital services provided by 

IPFs for discharges occurring during the 

FY beginning October 1, 2014, through 

September 30, 2015. We are applying 

the FY 2008-based RPL market basket 

increase of 2.7 percent, less the 

productivity adjustment of 0.4 

percentage point as required by 

1886(s)(2)(A)(i) of the Act, and less the 

0.3 percentage point required by 

sections 1886(s)(2)(A)(ii) and 

1886(s)(3)(C) of the Act. In this 

proposed rule, we also address the 

implementation of the International 

Classification of Diseases, 10th 

Revision, Clinical Modification (ICD– 

10–CM/PCS) for the IPF prospective 

payment system, and describe new 

quality reporting requirements for the 

IPFQR Program. 

B. Overall Impact 

We have examined the impact of this 

proposed rule as required by Executive 

Order 12866 on Regulatory Planning 

and Review (September 30, 1993), 

Executive Order 13563 on Improving 

Regulation and Regulatory Review 

(January 18, 2011), the Regulatory 

Flexibility Act (RFA) (September 19, 

1980, Pub. L. 96–354), section 1102(b) of 

the Social Security Act, section 202 of 

the Unfunded Mandates Reform Act of 

1995 (March 22, 1995; Pub. L. 104–4), 

Executive Order 13132 on Federalism 

(August 4, 1999) and the Congressional 

Review Act (5 U.S.C. 804(2)). 

Executive Orders 12866 and 13563 

direct agencies to assess all costs and 

benefits of available regulatory 

alternatives and, if regulation is 

necessary, to select regulatory 

approaches that maximize net benefits 

(including potential economic, 

environmental, public health and safety 


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effects, distributive impacts, and 

equity). A regulatory impact analysis 

(RIA) must be prepared for a major rules 

with economically significant effects 

($100 million or more in any 1 year). 

This proposed rule is designated as 

economically ‘‘significant’’ under 

section 3(f)(1) of Executive Order 12866. 

We estimate that the total impact of 

these changes for FY 2015 payments 

compared to FY 2014 payments will be 

a net increase of approximately $100 

million. This reflects a $95 million 

increase from the update to the payment 

rates, as well as a $5 million increase as 

a result of the update to the outlier 

threshold amount. Outlier payments are 

estimated to increase from 1.9 percent 

in FY 2014 to 2.0 percent in FY 2015. 

The RFA requires agencies to analyze 

options for regulatory relief of small 

entities if a rule has a significant impact 

on a substantial number of small 

entities. For purposes of the RFA, small 

entities include small businesses, 

nonprofit organizations, and small 

governmental jurisdictions. Most IPFs 

and most other providers and suppliers 

are small entities, either by nonprofit 

status or having revenues of $7 million 

to $35.5 million or less in any 1 year, 

depending on industry classification 

(for details, refer to the SBA Small 

Business Size Standards found at 

http://www.sba.gov/sites/default/files/

files/Size_Standards_Table.pdf), or 

being nonprofit organizations that are 

not dominant in their markets. 

Because we lack data on individual 

hospital receipts, we cannot determine 

the number of small proprietary IPFs or 

the proportion of IPFs’ revenue derived 

from Medicare payments. Therefore, we 

assume that all IPFs are considered 

small entities. The Department of Health 

and Human Services generally uses a 

revenue impact of 3 to 5 percent as a 

significance threshold under the RFA. 

As shown in Table 21, we estimate 

that the overall revenue impact of this 

proposed rule on all IPFs is to increase 

Medicare payments by approximately 

2.1 percent. As a result, since the 

estimated impact of this proposed rule 

is a net increase in revenue across all 

categories of IPFs, the Secretary has 

determined that this proposed rule 

would have a positive revenue impact 

on a substantial number of small 

entities. MACs are not considered to be 

small entities. Individuals and States are 

not included in the definition of a small 

entity. 

In addition, section 1102(b) of the 

Social Security Act requires us to 

prepare a regulatory impact analysis if 

a rule may have a significant impact on 

the operations of a substantial number 

of small rural hospitals. This analysis 

must conform to the provisions of 

section 603 of the RFA. For purposes of 

section 1102(b) of the Act, we define a 

small rural hospital as a hospital that is 

located outside of a metropolitan 

statistical area and has fewer than 100 

beds. As discussed in detail below, the 

rates and policies set forth in this 

proposed rule would not have an 

adverse impact on the rural hospitals 

based on the data of the 310 rural units 

and 74 rural hospitals in our database of 

1,626 IPFs for which data were 

available. Therefore, the Secretary has 

determined that this proposed rule 

would not have a significant impact on 

the operations of a substantial number 

of small rural hospitals. 

Section 202 of the Unfunded 

Mandates Reform Act of 1995 (UMRA) 

also requires that agencies assess 

anticipated costs and benefits before 

issuing any rule whose mandates 

require spending in any 1 year of $100 

million in 1995 dollars, updated 

annually for inflation. In 2014, that 

threshold is approximately $141 

million. This proposed rule will not 

impose spending costs on state, local, or 

tribal governments in the aggregate, or 

by the private sector, of $141 million. 

Executive Order 13132 establishes 

certain requirements that an agency 

must meet when it promulgates a 

proposed rule (and subsequent final 

rule) that imposes substantial direct 

requirement costs on state and local 

governments, preempts state law, or 

otherwise has Federalism implications. 

As stated above, this proposed rule 

would not have a substantial effect on 

state and local governments. 

C. Anticipated Effects 

We discuss the historical background 

of the IPF PPS and the impact of this 

proposed rule on the Federal Medicare 

budget and on IPFs. 

1. Budgetary Impact 

As discussed in the November 2004 

and May 2006 IPF PPS final rules, we 

applied a budget neutrality factor to the 

Federal per diem and ECT base rates to 

ensure that total estimated payments 

under the IPF PPS in the 

implementation period would equal the 

amount that would have been paid if the 

IPF PPS had not been implemented. The 

budget neutrality factor includes the 

following components: outlier 

adjustment, stop-loss adjustment, and 

the behavioral offset. As discussed in 

the May 2008 IPF PPS notice (73 FR 

25711), the stop-loss adjustment is no 

longer applicable under the IPF PPS. 

In accordance with § 412.424(c)(3)(ii), 

we indicated that we will evaluate the 

accuracy of the budget neutrality 

adjustment within the first 5 years after 

implementation of the payment system. 

We may make a one-time prospective 

adjustment to the Federal per diem and 

ECT base rates to account for differences 

between the historical data on costbased TEFRA payments (the basis of the 

budget neutrality adjustment) and 

estimates of TEFRA payments based on 

actual data from the first year of the IPF 

PPS. As part of that process, we will 

reassess the accuracy of all of the factors 

impacting budget neutrality. In 

addition, as discussed in section VII.C.1 

of this proposed rule, we are using the 

wage index and labor-related share in a 

budget neutral manner by applying a 

wage index budget neutrality factor to 

the Federal per diem and ECT base 

rates. 

Therefore, the budgetary impact to the 

Medicare program of this proposed rule 

will be due to the market basket update 

for FY 2015 of 2.7 percent (see section 

V.B. of this proposed rule) less the 

productivity adjustment of 0.4 

percentage point required by section 

1886(s)(2)(A)(i) of the Act, less the 

‘‘other adjustment’’ of 0.3 percentage 

point under sections 1886(s)(2)(A)(ii) 

and 1886(s)(3)(C) of the Act, and the 

update to the outlier fixed dollar loss 

threshold amount. 

We estimate that the FY 2015 impact 

will be a net increase of $100 million in 

payments to IPF providers. This reflects 

an estimated $95 million increase from 

the update to the payment rates and a 

$5 million increase due to the update to 

the outlier threshold amount to increase 

outlier payments from approximately 

1.9 percent in FY 2014 to 2.0 percent in 

FY 2015. This estimate does not include 

the implementation of the required 2 

percentage point reduction of the 

market basket increase factor for any IPF 

that fails to meet the IPF quality 

reporting requirements (as discussed in 

section 4 below). 

2. Impact on Providers 

To understand the impact of the 

changes to the IPF PPS on providers, 

discussed in this proposed rule, it is 

necessary to compare estimated 

payments under the IPF PPS rates and 

factors for FY 2015 versus those under 

FY 2014. The estimated payments for 

FY 2014 and FY 2015 will be 100 

percent of the IPF PPS payment, since 

the transition period has ended and 

stop-loss payments are no longer paid. 

We determined the percent change of 

estimated FY 2015 IPF PPS payments to 

FY 2014 IPF PPS payments for each 

category of IPFs. In addition, for each 

category of IPFs, we have included the 

estimated percent change in payments 

resulting from the update to the outlier 


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fixed dollar loss threshold amount, the 

labor-related share and wage index 

changes for the FY 2015 IPF PPS, and 

the market basket update for FY 2015, 

as adjusted by the productivity 

adjustment according to section 

1886(s)(2)(A)(i), and the ‘‘other 

adjustment’’ according to sections 

1886(s)(2)(A)(ii) and 1886(s)(3)(C) of the 

Act. 

To illustrate the impacts of the FY 

2015 changes in this proposed rule, our 

analysis begins with a FY 2014 baseline 

simulation model based on FY 2013 IPF 

payments inflated to the midpoint of FY 

2014 using IHS Global Insight Inc.’s 

most recent forecast of the market basket 

update (see section IV.C. of this 

proposed rule); the estimated outlier 

payments in FY 2014; the CBSA 

designations for IPFs based on OMB’s 

MSA definitions after June 2003; the FY 

2013 pre-floor, pre-reclassified hospital 

wage index; the FY 2014 labor-related 

share; and the FY 2014 percentage 

amount of the rural adjustment. During 

the simulation, the total estimated 

outlier payments are maintained at 2 

percent of total IPF PPS payments. 

Each of the following changes is 

added incrementally to this baseline 

model in order for us to isolate the 

effects of each change: 

• The update to the outlier fixed 

dollar loss threshold amount. 

• The FY 2014 pre-floor, prereclassified hospital wage index and FY 

2015 labor-related share. 

• The market basket update for FY 

2015 of 2.7 percent less the productivity 

adjustment of 0.4 percentage point 

reduction in accordance with section 

1886(s)(2)(A)(i) of the Act and less the 

‘‘other adjustment’’ of 0.3 percentage 

point in accordance with sections 

1886(s)(2)(A)(ii) and 1886(s)(3)(C) of the 

Act. 

Our final comparison illustrates the 

percent change in payments from FY 

2014 (that is, October 1, 2013, to 

September 30, 2014) to FY 2015 (that is, 

October 1, 2014, to September 30, 2015) 

including all the changes in this 

proposed rule. 

TABLE 21—IPF IMPACT TABLE FOR FY 2015 

[Projected impacts (% Change in columns 3–6] 

Facility by type Number of 

facilities Outlier 

CBSA wage 

index & 

labor share 

Adjusted 

market 

basket 

update 1

Total 

percent 

change 2

(1) (2) (3) (4) (5) (6) 

All Facilities .......................................................................... 1,626 0.1 0.0 2.0 2.1 

Total Urban .......................................................................... 1,242 0.1 0.0 2.0 2.1 

Total Rural ........................................................................... 384 0.1 ¥0.2 2.0 1.9 

Urban unit ............................................................................ 829 0.1 0.1 2.0 2.2 

Urban hospital ...................................................................... 413 0.0 0.0 2.0 2.0 

Rural unit .............................................................................. 310 0.1 ¥0.1 2.0 2.0 

Rural hospital ....................................................................... 74 0.0 ¥0.3 2.0 1.7 

By Type of Ownership: 

Freestanding IPFs 

Urban Psychiatric Hospitals 

Government ........................................................... 129 0.1 0.0 2.0 2.0 

Non-Profit ............................................................... 99 0.1 0.2 2.0 2.3 

For-Profit ................................................................ 185 0.0 ¥0.2 2.0 1.8 

Rural Psychiatric Hospitals 

Government ........................................................... 36 0.1 0.3 2.0 2.4 

Non-Profit ............................................................... 13 0.1 ¥0.1 2.0 1.9 

For-Profit ................................................................ 25 0.0 ¥0.8 2.0 1.2 

IPF Units 

Urban 

Government ........................................................... 129 0.2 0.1 2.0 2.3 

Non-Profit ............................................................... 543 0.1 0.1 2.0 2.2 

For-Profit ................................................................ 157 0.1 ¥0.1 2.0 1.9 

Rural 

Government ........................................................... 75 0.1 ¥0.1 2.0 1.9 

Non-Profit ............................................................... 169 0.1 ¥0.1 2.0 1.9 

For-Profit ................................................................ 66 0.1 ¥0.1 2.0 2.0 

By Teaching Status: 

Non-teaching ................................................................. 1,427 0.1 0.0 2.0 2.0 

Less than 10% interns and residents to beds .............. 108 0.1 0.2 2.0 2.3 

10% to 30% interns and residents to beds .................. 68 0.1 0.0 2.0 2.2 

More than 30% interns and residents to beds ............. 23 0.2 0.5 2.0 2.7 

By Region: 

New England ................................................................ 109 0.1 0.1 2.0 2.2 

Mid-Atlantic ................................................................... 251 0.1 0.6 2.0 2.7 

South Atlantic ................................................................ 234 0.1 ¥0.3 2.0 1.7 

East North Central ........................................................ 260 0.1 ¥0.2 2.0 1.9 

East South Central ....................................................... 166 0.1 ¥0.3 2.0 1.8 

West North Central ....................................................... 143 0.1 ¥0.3 2.0 1.8 

West South Central ...................................................... 238 0.0 ¥0.5 2.0 1.6 

Mountain ....................................................................... 103 0.1 ¥0.3 2.0 1.7 

Pacific ........................................................................... 122 0.1 1.0 2.0 3.1 

By Bed Size: 

Psychiatric Hospitals 

Beds: 0–24 ............................................................ 88 0.0 ¥0.3 2.0 1.7 

Beds: 25–49 .......................................................... 67 0.0 ¥0.1 2.0 1.9 


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TABLE 21—IPF IMPACT TABLE FOR FY 2015—Continued 

[Projected impacts (% Change in columns 3–6] 

Facility by type Number of 

facilities Outlier 

CBSA wage 

index & 

labor share 

Adjusted 

market 

basket 

update 1

Total 

percent 

change 2

(1) (2) (3) (4) (5) (6) 

Beds: 50–75 .......................................................... 88 0.0 ¥0.1 2.0 2.0 

Beds: 76 + ............................................................. 244 0.0 0.0 2.0 2.0 

Psychiatric Units 

Beds: 0–24 ............................................................ 680 0.1 0.0 2.0 2.1 

Beds: 25–49 .......................................................... 298 0.1 ¥0.1 2.0 2.0 

Beds: 50–75 .......................................................... 102 0.1 0.1 2.0 2.1 

Beds: 76 + ............................................................. 59 0.1 0.4 2.0 2.6 

1This column reflects the payment update impact of the RPL market basket update for FY 2015 of 2.7 percent, a 0.4 percentage point reduction for the productivity adjustment as required by section 1886(s)(2)(A)(i) of the Act, and a 0.3 percentage point reduction in accordance with 

sections 1886(s)(2)(A)(ii) and 1886(s)(3)(C) of the Act. 2Percent changes in estimated payments from FY 2014 to FY 2015 include all of the changes presented in this proposed rule. Note, the products of these impacts may be different from the percentage changes shown here due to rounding effects. 

3. Results 

Table 21 above displays the results of 

our analysis. The table groups IPFs into 

the categories listed below based on 

characteristics provided in the Provider 

of Services (POS) file, the IPF provider 

specific file, and cost report data from 

HCRIS: 

• Facility Type 

• Location 

• Teaching Status Adjustment 

• Census Region 

• Size 

The top row of the table shows the 

overall impact on the 1,626 IPFs 

included in this analysis. 

In column 3, we present the effects of 

the update to the outlier fixed dollar 

loss threshold amount. We estimate that 

IPF outlier payments as a percentage of 

total IPF payments are 1.9 percent in FY 

2014. Thus, we are adjusting the outlier 

threshold amount in this proposed rule 

to set total estimated outlier payments 

equal to 2 percent of total payments in 

FY 2015. The estimated change in total 

IPF payments for FY 2015, therefore, 

includes an approximate 0.1 percent 

increase in payments because the outlier 

portion of total payments is expected to 

increase from approximately 1.9 percent 

to 2 percent. 

The overall impact of this outlier 

adjustment update (as shown in column 

3 of table 21), across all hospital groups, 

is to increase total estimated payments 

to IPFs by 0.1 percent. We do not 

estimate that any group of IPFs will 

experience a decrease in payments from 

this update. The largest increase in 

payments is estimated to reflect a 0.2 

percent increase in payments for urban 

government IPF units and IPFs located 

in teaching hospitals with an intern and 

resident ADC ratio greater than 30 

percent. 

In column 4, we present the effects of 

the budget-neutral update to the laborrelated share and the wage index 

adjustment under the CBSA geographic 

area definitions announced by OMB in 

June 2003. This is a comparison of the 

simulated FY 2015 payments under the 

FY 2014 hospital wage index under 

CBSA classification and associated 

labor-related share to the simulated FY 

2014 payments under the FY 2013 

hospital wage index under CBSA 

classifications and associated laborrelated share. We note that there is no 

projected change in aggregate payments 

to IPFs, as indicated in the first row of 

column 4. However, there will be small 

distributional effects among different 

categories of IPFs. For example, we 

estimate the largest increase in 

payments to be a 1.0 percent increase 

for IPFs in the Pacific region and the 

largest decrease in payments to be a 0.8 

percent decrease for rural for-profit 

IPFs. 

Column 5 shows the estimated effect 

of the update to the IPF PPS payment 

rates, which includes a 2.7 percent 

market basket update less the 

productivity adjustment of 0.4 

percentage point in accordance with 

section 1886(s)(2)(A)(i), and less the 0.3 

percentage point in accordance with 

section 1886(s)(2)(A)(ii) and 

1886(s)(3)(C). 

Column 6 compares our estimates of 

the total changes reflected in this 

proposed rule for FY 2015, to our 

payments for FY 2014 (without these 

changes). This column reflects all FY 

2015 changes relative to FY 2014. The 

average estimated increase for all IPFs is 

approximately 2.1 percent. This 

estimated net increase includes the 

effects of the 2.7 percent market basket 

update adjusted by the productivity 

adjustment of minus 0.4 percentage 

point, as required by section 

1886(s)(2)(A)(i) of the Act and the 

‘‘other adjustment’’ of minus 0.3 

percentage point, as required by 

sections 1886(s)(2)(A)(ii) and 

1886(s)(3)(C) of the Act. It also includes 

the overall estimated 0.1 percent 

increase in estimated IPF outlier 

payments from the update to the outlier 

fixed dollar loss threshold amount. 

Since we are making the updates to the 

IPF labor-related share and wage index 

in a budget-neutral manner, they will 

not affect total estimated IPF payments 

in the aggregate. However, they will 

affect the estimated distribution of 

payments among providers. 

Overall, no IPFs are estimated to 

experience a net decrease in payments 

as a result of the updates in this 

proposed rule. IPFs in urban areas will 

experience a 2.1 percent increase and 

IPFs in rural areas will experience a 1.9 

percent increase. The largest payment 

increase is estimated at 3.1 percent for 

IPFs in the Pacific region. This is due to 

the larger than average positive effect of 

the CBSA wage index and labor-related 

share update for IPFs in this category. 

4. Effects of Updates to the IPF QRP 

As discussed in section V.B. of this 

proposed rule and in accordance with 

section 1886(s)(4)(A)(ii) of the Act, we 

will implement a 2 percentage point 

reduction in the FY 2015 increase factor 

for IPFs that have failed to report the 

required quality reporting data to us 

during the most recent IPF quality 

reporting period. In section V.B. of this 

proposed rule, we discuss how the 2 

percentage point reduction will be 

applied. Only a few IPFs received the 2 

percentage point reduction in the FY 

2014 increase factor for failure to meet 


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program requirements, and we would 

anticipate that even fewer IPFs would 

receive the reduction for FY 2015 as 

IPFs become more familiar with the 

requirements. Thus, we estimate that 

this policy will have a negligible impact 

on overall IPF payments for FY 2015. 

For the FY 2016 payment 

determination, we estimate no 

additional burden on IPFs as a result of 

proposed changes in reporting 

requirements. For the FY 2017 payment 

determination, we estimate an 

additional annual burden across all 

1,626 IPFs of 701,619 hours, with a total 

Program cost of $44,496,677. This 

estimate includes an estimated 3,252 

hours annually for training, at an 

estimated annual cost of $206,241. It 

also includes an estimated 4,065 hours 

annually, at an estimated annual cost of 

$257,802, for IPFs to submit to CMS 

aggregate population counts for 

Medicare and non-Medicare discharges 

by age group, diagnostic group, and 

quarter, and sample size counts for 

measures for which sampling is 

performed. Further discussion of these 

figures can be found in section IX. 

For the FY 2017 payment 

determination, the applicable reporting 

period is calendar year (CY) 2015. 

Assuming that reporting costs are 

uniformly distributed across the year, 

three-quarters of those costs would have 

been incurred in FY 2015, which ends 

on September 30, 2015. Therefore, the 

estimated FY 2015 burden for IPFs 

would be three-quarters of $44,496,677, 

or approximately $33,372,508. 

We intend to closely monitor the 

effects of this new quality reporting 

program on IPF providers and help 

facilitate successful reporting outcomes 

through ongoing stakeholder education, 

national trainings, and a technical help 

desk. 

5. Effect on Beneficiaries 

Under the IPF PPS, IPFs will receive 

payment based on the average resources 

consumed by patients for each day. We 

do not expect changes in the quality of 

care or access to services for Medicare 

beneficiaries under the FY 2015 IPF PPS 

but we continue to expect that paying 

prospectively for IPF services would 

enhance the efficiency of the Medicare 

program. 

D. Alternatives Considered 

The statute does not specify an update 

strategy for the IPF PPS and is broadly 

written to give the Secretary discretion 

in establishing an update methodology. 

Therefore, we are updating the IPF PPS 

using the methodology published in the 

November 2004 IPF PPS final rule. No 

alternative policy options were 

considered in this proposed rule since 

this proposed rule simply provides an 

update to the rates for FY 2015 and 

transition ICD–9–CM codes to ICD–10– 

CM codes. Additionally, for the IPFQR 

Program, alternatives were not 

considered because the Program, as 

designed, best achieves quality 

reporting goals for the inpatient 

psychiatric care setting, while 

minimizing associated reporting 

burdens on IPFs. Lastly, sections VIII.1. 

and VIII.4. discuss other benefits and 

objectives of the Program. 

E. Accounting Statement 

As required by OMB Circular A–4 

(available at http://

www.whitehouse.gov/omb/circulars_

a004_a-4), in Table 22 below, we have 

prepared an accounting statement 

showing the classification of the 

expenditures associated with the 

provisions of this proposed rule. The 

costs for data submission presented in 

Table 22 are calculated in section IX, 

which also discusses the benefits of data 

collection. This table provides our best 

estimate of the increase in Medicare 

payments under the IPF PPS as a result 

of the changes presented in this 

proposed rule and based on the data for 

1,626 IPFs in our database. Furthermore, 

we present the estimated costs 

associated with updating the IPFQR 

program. The increases in Medicare 

payments are classified as Federal 

transfers to IPF Medicare providers. 

TABLE 22—ACCOUNTING STATEMENT: CLASSIFICATION OF ESTIMATED EXPENDITURES

Category Transfers 

Change in Estimated Transfers from FY 2014 IPF PPS to FY 2015 IPF PPS: 

Annualized Monetized Transfers .............................................................. $100 million. 

From Whom to Whom? ............................................................................ Federal Government to IPF Medicare Providers 

FY 2015 Costs to updating the Quality Reporting Program for IPFs: 

Category Costs 

Annualized Monetized Costs for IPFs to Submit Data (Quality Reporting Program).33,372,508 

In accordance with the provisions of 

Executive Order 12866, this proposed 

rule was reviewed by the Office of 

Management and Budget. 

Dated: April 17, 2014. 

Marilyn Tavenner, 

Administrator, Centers for Medicare & 

Medicaid Services. 

Approved: April 24, 2014. 

Kathleen Sebelius, 

Secretary. 

Note: The following Addenda will not 

appear in the Code of Federal Regulations. 

Addendum A—Rate and Adjustment 

Factors 

PER DIEM RATE

Federal Per Diem Base Rate .............................................................................................................................................. $727.67 

Labor Share (0.69538) ........................................................................................................................................................ 506.01 

Non-Labor Share (0.30462) ................................................................................................................................................. 221.66 


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PER DIEM RATE APPLYING THE 2 PERCENTAGE POINT REDUCTION

Federal Per Diem Base Rate .............................................................................................................................................. $713.40 

Labor Share (0.69538) ........................................................................................................................................................ 496.08 

Non-Labor Share (0.30462) ................................................................................................................................................. 217.32 

Fixed Dollar Loss Threshold Amount: 

$10,125. 

Wage Index Budget-Neutrality Factor: 

1.0003. 

FACILITY ADJUSTMENTS

Rural Adjustment Factor ........................................................................... 1.17 

Teaching Adjustment Factor .................................................................... 0.5150 

Wage Index .............................................................................................. Pre-reclass Hospital Wage Index (FY2014) 

COST OF LIVING ADJUSTMENTS (COLAS) 

Area 

Cost of living 

adjustment 

factor 

Alaska: ................................................................................................................................................................................................. ........................

City of Anchorage and 80-kilometer (50-mile) radius by road ..................................................................................................... 1.23 

City of Fairbanks and 80-kilometer (50-mile) radius by road ...................................................................................................... 1.23 

City of Juneau and 80-kilometer (50-mile) radius by road .......................................................................................................... 1.23 

Rest of Alaska .............................................................................................................................................................................. 1.25 

Hawaii:.

City and County of Honolulu ........................................................................................................................................................ 1.25 

County of Hawaii .......................................................................................................................................................................... 1.19 

County of Kauai ............................................................................................................................................................................ 1.25 

County of Maui and County of Kalawao ...................................................................................................................................... 1.25 

PATIENT ADJUSTMENTS

ECT—Per Treatment ........................................................................................................................................................................... $313.27 

ECT—Per Treatment Applying the 2 Percentage Point Reduction .................................................................................................... $307.13 

VARIABLE PER DIEM ADJUSTMENTS

Adjustment 

factor 

Day 1—Facility Without a Qualifying Emergency Department ........................................................................................................... 1.19 

Day 1—Facility With a Qualifying Emergency Department ................................................................................................................ 1.31 

Day 2 ................................................................................................................................................................................................... 1.12 

Day 3 ................................................................................................................................................................................................... 1.08 

Day 4 ................................................................................................................................................................................................... 1.05 

Day 5 ................................................................................................................................................................................................... 1.04 

Day 6 ................................................................................................................................................................................................... 1.02 

Day 7 ................................................................................................................................................................................................... 1.01 

Day 8 ................................................................................................................................................................................................... 1.01 

Day 9 ................................................................................................................................................................................................... 1.00 

Day 10 ................................................................................................................................................................................................. 1.00 

Day 11 ................................................................................................................................................................................................. 0.99 

Day 12 ................................................................................................................................................................................................. 0.99 

Day 13 ................................................................................................................................................................................................. 0.99 

Day 14 ................................................................................................................................................................................................. 0.99 

Day 15 ................................................................................................................................................................................................. 0.98 

Day 16 ................................................................................................................................................................................................. 0.97 

Day 17 ................................................................................................................................................................................................. 0.97 

Day 18 ................................................................................................................................................................................................. 0.96 

Day 19 ................................................................................................................................................................................................. 0.95 

Day 20 ................................................................................................................................................................................................. 0.95 

Day 21 ................................................................................................................................................................................................. 0.95 

After Day 21 ......................................................................................................................................................................................... 0.92 


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Federal Register / Vol. 79, No. 87 / Tuesday, May 6, 2014 / Proposed Rules 26081 

AGE ADJUSTMENTS

Age (in years) Adjustment 

factor 

Under 45 .............................................................................................................................................................................................. 1.00 

45 and under 50 .................................................................................................................................................................................. 1.01 

50 and under 55 .................................................................................................................................................................................. 1.02 

55 and under 60 .................................................................................................................................................................................. 1.04 

60 and under 65 .................................................................................................................................................................................. 1.07 

65 and under 70 .................................................................................................................................................................................. 1.10 

70 and under 75 .................................................................................................................................................................................. 1.13 

75 and under 80 .................................................................................................................................................................................. 1.15 

80 and over .......................................................................................................................................................................................... 1.17 

DRG ADJUSTMENTS

MS–DRG MS–DRG Descriptions Adjustment 

factor 

056 ....................

057 ....................

Degenerative nervous system disorders w MCC .................................................................................................

Degenerative nervous system disorders w/o MCC ..............................................................................................

1.05 

080 ....................

081 ....................

Nontraumatic stupor & coma w MCC ...................................................................................................................

Nontraumatic stupor & coma w/o MCC ................................................................................................................

1.07 

876 .................... O.R. procedure w principal diagnoses of mental illness ...................................................................................... 1.22 

880 .................... Acute adjustment reaction & psychosocial dysfunction ....................................................................................... 1.05 

881 .................... Depressive neuroses ............................................................................................................................................ 0.99 

882 .................... Neuroses except depressive ................................................................................................................................ 1.02 

883 .................... Disorders of personality & impulse control ........................................................................................................... 1.02 

884 .................... Organic disturbances & mental retardation .......................................................................................................... 1.03 

885 .................... Psychoses ............................................................................................................................................................ 1.00 

886 .................... Behavioral & developmental disorders ................................................................................................................. 0.99 

887 .................... Other mental disorder diagnoses ......................................................................................................................... 0.92 

894 .................... Alcohol/drug abuse or dependence, left AMA ..................................................................................................... 0.97 

895 .................... Alcohol/drug abuse or dependence w rehabilitation therapy ............................................................................... 1.02 

896 ....................

897 ....................

Alcohol/drug abuse or dependence w/o rehabilitation therapy w MCC ...............................................................

Alcohol/drug abuse or dependence w/o rehabilitation therapy w/o MCC ............................................................

0.88 

COMORBIDITY ADJUSTMENTS

Comorbidity Adjustment 

factor 

Developmental Disabilities ................................................................................................................................................................... 1.04 

Coagulation Factor Deficit ................................................................................................................................................................... 1.13 

Tracheostomy ...................................................................................................................................................................................... 1.06 

Eating and Conduct Disorders ............................................................................................................................................................ 1.12 

Infectious Diseases .............................................................................................................................................................................. 1.07 

Renal Failure, Acute ............................................................................................................................................................................ 1.11 

Renal Failure, Chronic ......................................................................................................................................................................... 1.11 

Oncology Treatment ............................................................................................................................................................................ 1.07 

Uncontrolled Diabetes Mellitus ............................................................................................................................................................ 1.05 

Severe Protein Malnutrition ................................................................................................................................................................. 1.13 

Drug/Alcohol Induced Mental Disorders .............................................................................................................................................. 1.03 

Cardiac Conditions .............................................................................................................................................................................. 1.11 

Gangrene ............................................................................................................................................................................................. 1.10 

Chronic Obstructive Pulmonary Disease ............................................................................................................................................. 1.12 

Artificial Openings—Digestive & Urinary ............................................................................................................................................. 1.08 

Severe Musculoskeletal & Connective Tissue Diseases .................................................................................................................... 1.09 

Poisoning ............................................................................................................................................................................................. 1.11 

Addendum B—FY 2015 CBSA Wage 

Index Tables 

In this addendum, we provide the wage 

index tables referred to in the preamble to 

this proposed rule. The tables presented 

below are as follows: 

Table1–FY 2015 Wage Index For Urban 

Areas Based on CBSA Labor Market Areas. 

Table 2–FY 2015 Wage Index Based On 

CBSA Labor Market Areas For Rural Areas. 


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TABLE 1—FY 2015 WAGE INDEX FOR URBAN AREAS BASED ON CBSA LABOR MARKET AREAS

CBSA Code Urban area (constituent counties) Wage index 

10180 ................ Abilene, TX, Callahan County, TX, Jones County, TX, Taylor County, TX ......................................................... 0.8225 

10380 ................ Aguadilla-Isabela-San Sebastia ́n, PR, Aguada Municipio, PR, Aguadilla Municipio, PR, An ̃asco Municipio, 

PR, Isabela Municipio, PR, Lares Municipio, PR, Moca Municipio, PR, Rinco ́n Municipio, PR, San 

Sebastia ́n Municipio, PR.

0.3647 

10420 ................ Akron, OH, Portage County, OH, Summit County, OH ....................................................................................... 0.8521 

10500 ................ Albany, GA, Baker County, GA, Dougherty County, GA, Lee County, GA, Terrell County, GA, Worth County, 

GA.

0.8713 

10580 ................ Albany-Schenectady-Troy, NY, Albany County, NY, Rensselaer County, NY, Saratoga County, NY, Schenectady County, NY, Schoharie County, NY.0.8600 

10740 ................ Albuquerque, NM, Bernalillo County, NM, Sandoval County, NM, Torrance County, NM, Valencia County, 

NM.

0.9663 

10780 ................ Alexandria, LA, Grant Parish, LA, Rapides Parish, LA ........................................................................................ 0.7788 

10900 ................ Allentown-Bethlehem-Easton, PA–NJ, Warren County, NJ, Carbon County, PA, Lehigh County, PA, Northampton County, PA.0.9215 

11020 ................ Altoona, PA, Blair County, PA .............................................................................................................................. 0.9101 

11100 ................ Amarillo, TX, Armstrong County, TX, Carson County, TX, Potter County, TX, Randall County, TX .................. 0.8302 

11180 ................ Ames, IA, Story County, IA .................................................................................................................................. 0.9425 

11260 ................ Anchorage, AK, Anchorage Municipality, AK, Matanuska-Susitna Borough, AK ................................................ 1.2221 

11300 ................ Anderson, IN, Madison County, IN ....................................................................................................................... 0.9654 

11340 ................ Anderson, SC, Anderson County, SC .................................................................................................................. 0.8766 

11460 ................ Arbor, MI, Washtenaw County, MI ....................................................................................................................... 1.0086 

11500 ................ Anniston-Oxford, AL, Calhoun County, AL ........................................................................................................... 0.7402 

11540 ................ Appleton, WI, Calumet County, WI, Outagamie County, WI ............................................................................... 0.9445 

11700 ................ Asheville, NC, Buncombe County, NC, Haywood County, NC, Henderson County, NC, Madison County, NC 0.8511 

12020 ................ Athens-Clarke County, GA, Clarke County, GA, Madison County, GA, Oconee County, GA, Oglethorpe 

County, GA.

0.9244 

12060 ................ Atlanta-Sandy Springs-Marietta, GA, Barrow County, GA, Bartow County, GA, Butts County, GA, Carroll 

County, GA, Cherokee County, GA, Clayton County, GA, Cobb County, GA, Coweta County, GA, Dawson 

County, GA, DeKalb County, GA, Douglas County, GA, Fayette County, GA, Forsyth County, GA, Fulton 

County, GA, Gwinnett County, GA, Haralson County, GA, Heard County, GA, Henry County, GA, Jasper 

County, GA, Lamar County, GA, Meriwether County, GA, Newton County, GA, Paulding County, GA, Pickens County, GA, Pike County, GA, Rockdale County, GA, Spalding County, GA, Walton County, GA.

0.9452 

12100 ................ Atlantic City-Hammonton, NJ, Atlantic County, NJ .............................................................................................. 1.2258 

12220 ................ Auburn-Opelika, AL, Lee County, AL ................................................................................................................... 0.7771 

12260 ................ Augusta-Richmond County, GA–SC, Burke County, GA, Columbia County, GA, McDuffie County, GA, Richmond County, GA, Aiken County, SC, Edgefield County, SC.0.9150 

12420 ................ Austin-Round Rock-San Marcos, TX, Bastrop County, TX, Caldwell County, TX, Hays County, TX, Travis 

County, TX, Williamson County, TX.

0.9576 

12540 ................ Bakersfield-Delano, CA, Kern County, CA ........................................................................................................... 1.1579 

12580 ................ Baltimore-Towson, MD, Anne Arundel County, MD, Baltimore County, MD, Carroll County, MD, Harford 

County, MD, Howard County, MD, Queen Anne’s County, MD, Baltimore City, MD.

0.9873 

12620 ................ Bangor, ME, Penobscot County, ME ................................................................................................................... 0.9710 

12700 ................ Barnstable Town, MA, Barnstable County, MA .................................................................................................... 1.3007 

12940 ................ Baton Rouge, LA, Ascension Parish, LA, East Baton Rouge Parish, LA, East Feliciana Parish, LA, Iberville 

Parish, LA, Livingston Parish, LA, Pointe Coupee Parish, LA, St. Helena Parish, LA, West Baton Rouge 

Parish, LA, West Feliciana Parish, LA.

0.8078 

12980 ................ Battle Creek, MI, Calhoun County, MI ................................................................................................................. 0.9915 

13020 ................ Bay City, MI, Bay County, MI ............................................................................................................................... 0.9486 

13140 ................ Beaumont-Port Arthur, TX, Hardin County, TX, Jefferson County, TX, Orange County, TX .............................. 0.8598 

13380 ................ Bellingham, WA, Whatcom County, WA .............................................................................................................. 1.1890 

13460 ................ Bend, OR, Deschutes County, OR ....................................................................................................................... 1.1807 

13644 ................ Bethesda-Rockville-Frederick, MD, Frederick County, MD, Montgomery County, MD ....................................... 1.0319 

13740 ................ Billings, MT, Carbon County, MT, Yellowstone County, MT ................................................................................ 0.8691 

13780 ................ Binghamton, NY, Broome County, NY, Tioga County, NY .................................................................................. 0.8602 

13820 ................ Birmingham-Hoover, AL, Bibb County, AL, Blount County, AL, Chilton County, AL, Jefferson County, AL, St. 

Clair County, AL, Shelby County, AL, Walker County, AL.

0.8367 

13900 ................ Bismarck, ND, Burleigh County, ND, Morton County, ND ................................................................................... 0.7282 

13980 ................ Blacksburg-Christiansburg-Radford, VA, Giles County, VA, Montgomery County, VA, Pulaski County, VA, 

Radford City, VA.

0.8319 

14020 ................ Bloomington, IN, Greene County, IN, Monroe County, IN, Owen County, IN ..................................................... 0.9304 

14060 ................ Bloomington-Normal, IL, McLean County, IL ....................................................................................................... 0.9310 

14260 ................ Boise City-Nampa, ID, Ada County, ID, Boise County, ID, Canyon County, ID, Gem County, ID, Owyhee 

County, ID.

0.9259 

14484 ................ Boston-Quincy, MA, Norfolk County, MA, Plymouth County, MA, Suffolk County, MA ...................................... 1.2453 

14500 ................ Boulder, CO, Boulder County, CO ....................................................................................................................... 0.9850 

14540 ................ Bowling Green, KY, Edmonson County, KY, Warren County, KY ....................................................................... 0.8573 

14740 ................ Bremerton-Silverdale, WA, Kitsap County, WA ................................................................................................... 1.0268 

14860 ................ Bridgeport-Stamford-Norwalk, CT, Fairfield County, CT ...................................................................................... 1.3252 

15180 ................ Brownsville-Harlingen, TX, Cameron County, TX ................................................................................................ 0.8179 

15260 ................ Brunswick, GA, Brantley County, GA, Glynn County, GA, McIntosh County, GA .............................................. 0.8457 

15380 ................ Buffalo-Niagara Falls, NY, Erie County, NY, Niagara County, NY ...................................................................... 1.0045 

15500 ................ Burlington, NC, Alamance County, NC ................................................................................................................ 0.8529 


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TABLE 1—FY 2015 WAGE INDEX FOR URBAN AREAS BASED ON CBSA LABOR MARKET AREAS—Continued 

CBSA Code Urban area (constituent counties) Wage index 

15540 ................ Burlington-South Burlington, VT, Chittenden County, VT, Franklin County, VT, Grand Isle County, VT ........... 1.0130 

15764 ................ Cambridge-Newton-Framingham, MA, Middlesex County, MA ........................................................................... 1.1146 

15804 ................ Camden, NJ, Burlington County, NJ, Camden County, NJ, Gloucester County, NJ .......................................... 1.0254 

15940 ................ Canton-Massillon, OH, Carroll County, OH, Stark County, OH ........................................................................... 0.8730 

15980 ................ Cape Coral-Fort Myers, FL, Lee County, FL ....................................................................................................... 0.8683 

16020 ................ Cape Girardeau-Jackson, MO–IL, Alexander County, IL, Bollinger County, MO, Cape Girardeau County, MO 0.9174 

16180 ................ Carson City, NV, Carson City, NV ....................................................................................................................... 1.0721 

16220 ................ Casper, WY, Natrona County, WY ....................................................................................................................... 1.0111 

16300 ................ Cedar Rapids, IA, Benton County, IA, Jones County, IA, Linn County, IA ......................................................... 0.8964 

16580 ................ Champaign-Urbana, IL, Champaign County, IL, Ford County, IL, Piatt County, IL ............................................ 0.9416 

16620 ................ Charleston, WV, Boone County, WV, Clay County, WV, Kanawha County, WV, Lincoln County, WV, Putnam 

County, WV.

0.8119 

16700 ................ Charleston-North Charleston-Summerville, SC, Berkeley County, SC, Charleston County, SC, Dorchester 

County, SC.

0.8972 

16740 ................ Charlotte-Gastonia-Rock Hill, NC-SC, Anson County, NC, Cabarrus County, NC, Gaston County, NC, Mecklenburg County, NC, Union County, NC, York County, SC.0.9447 

16820 ................ Charlottesville, VA, Albemarle County, VA, Fluvanna County, VA, Greene County, VA, Nelson County, VA, 

Charlottesville City, VA.

0.9209 

16860 ................ Chattanooga, TN–GA, Catoosa County, GA, Dade County, GA, Walker County, GA, Hamilton County, TN, 

Marion County, TN, Sequatchie County, TN.

0.8783 

16940 ................ Cheyenne, WY, Laramie County, WY .................................................................................................................. 0.9494 

16974 ................ Chicago-Naperville-Joliet, IL, Cook County, IL, DeKalb County, IL, DuPage County, IL, Grundy County, IL, 

Kane County, IL, Kendall County, IL, McHenry County, IL, Will County, IL.

1.0418 

17020 ................ Chico, CA, Butte County, CA ............................................................................................................................... 1.1616 

17140 ................ Cincinnati-Middletown, OH–KY–IN, Dearborn County, IN, Franklin County, IN, Ohio County, IN, Boone 

County, KY, Bracken County, KY, Campbell County, KY, Gallatin County, KY, Grant County, KY, Kenton 

County, KY, Pendleton County, KY, Brown County, OH, Butler County, OH, Clermont County, OH, Hamilton County, OH, Warren County, OH.

0.9470 

17300 ................ Clarksville, TN–KY, Christian County, KY, Trigg County, KY, Montgomery County, TN, Stewart County, TN .. 0.7802 

17420 ................ Cleveland, TN, Bradley County, TN, Polk County, TN ........................................................................................ 0.7496 

17460 ................ Cleveland-Elyria-Mentor, OH, Cuyahoga County, OH, Geauga County, OH, Lake County, OH, Lorain County, OH, Medina County, OH.0.9303 

17660 ................ Coeur d’Alene, ID, Kootenai County, ID .............................................................................................................. 0.9064 

17780 ................ College Station-Bryan, TX, Brazos County, TX, Burleson County, TX, Robertson County, TX ......................... 0.9497 

17820 ................ Colorado Springs, CO, El Paso County, CO, Teller County, CO ........................................................................ 0.9282 

17860 ................ Columbia, MO, Boone County, MO, Howard County, MO .................................................................................. 0.8196 

17900 ................ Columbia, SC, Calhoun County, SC, Fairfield County, SC, Kershaw County, SC, Lexington County, SC, 

Richland County, SC, Saluda County, SC.

0.8601 

17980 ................ Columbus, GA–AL, Russell County, AL, Chattahoochee County, GA, Harris County, GA, Marion County, 

GA, Muscogee County, GA.

0.8170 

18020 ................ Columbus, IN, Bartholomew County, IN .............................................................................................................. 0.9818 

18140 ................ Columbus, OH, Delaware County, OH, Fairfield County, OH, Franklin County, OH, Licking County, OH, 

Madison County, OH, Morrow County, OH, Pickaway County, OH, Union County, OH.

0.9803 

18580 ................ Corpus Christi, TX, Aransas County, TX, Nueces County, TX, San Patricio County, TX .................................. 0.8433 

18700 ................ Corvallis, OR, Benton County, OR ....................................................................................................................... 1.0596 

18880 ................ Crestview-Fort Walton Beach-Destin, FL, Okaloosa County, FL ......................................................................... 0.8911 

19060 ................ Cumberland, MD–WV, Allegany County, MD, Mineral County, WV .................................................................... 0.8054 

19124 ................ Dallas-Plano-Irving, TX, Collin County, TX, Dallas County, TX, Delta County, TX, Denton County, TX, Ellis 

County, TX, Hunt County, TX, Kaufman County, TX, Rockwall County, TX.

0.9831 

19140 ................ Dalton, GA, Murray County, GA, Whitfield County, GA ....................................................................................... 0.8625 

19180 ................ Danville, IL, Vermilion County, IL ......................................................................................................................... 0.9460 

19260 ................ Danville, VA, Pittsylvania County, VA, Danville City, VA ..................................................................................... 0.7888 

19340 ................ Davenport-Moline-Rock Island, IA–IL, Henry County, IL, Mercer County, IL, Rock Island County, IL, Scott 

County, IA.

0.9306 

19380 ................ Dayton, OH, Greene County, OH, Miami County, OH, Montgomery County, OH, Preble County, OH ............. 0.9034 

19460 ................ Decatur, AL, Lawrence County, AL, Morgan County, AL .................................................................................... 0.7165 

19500 ................ Decatur, IL, Macon County, IL ............................................................................................................................. 0.8151 

19660 ................ Deltona-Daytona Beach-Ormond Beach, FL, Volusia County, FL ....................................................................... 0.8560 

19740 ................ Denver-Aurora-Broomfield, CO, Adams County, CO, Arapahoe County, CO, Broomfield County, CO, Clear 

Creek County, CO, Denver County, CO, Douglas County, CO, Elbert County, CO, Gilpin County, CO, Jefferson County, CO, Park County, CO.

1.0395 

19780 ................ Des Moines-West Des Moines, IA, Dallas County, IA, Guthrie County, IA, Madison County, IA, Polk County, 

IA, Warren County, IA.

0.9393 

19804 ................ Detroit-Livonia-Dearborn, MI, Wayne County, MI ................................................................................................ 0.9237 

20020 ................ Dothan, AL, Geneva County, AL, Henry County, AL, Houston County, AL ........................................................ 0.7108 

20100 ................ Dover, DE, Kent County, DE ................................................................................................................................ 0.9939 

20220 ................ Dubuque, IA, Dubuque County, IA ....................................................................................................................... 0.8790 

20260 ................ Duluth, MN–WI, Carlton County, MN, St. Louis County, MN, Douglas County, WI ............................................ 1.0123 

20500 ................ Durham-Chapel Hill, NC, Chatham County, NC, Durham County, NC, Orange County, NC, Person County, 

NC.

0.9669 

20740 ................ Eau Claire, WI, Chippewa County, WI, Eau Claire County, WI ........................................................................... 1.0103 


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TABLE 1—FY 2015 WAGE INDEX FOR URBAN AREAS BASED ON CBSA LABOR MARKET AREAS—Continued 

CBSA Code Urban area (constituent counties) Wage index 

20764 ................ Edison-New Brunswick, NJ, Middlesex County, NJ, Monmouth County, NJ, Ocean County, NJ, Somerset 

County, NJ.

1.0985 

20940 ................ El Centro, CA, Imperial County, CA ..................................................................................................................... 0.8848 

21060 ................ Elizabethtown, KY, Hardin County, KY, Larue County, KY ................................................................................. 0.7894 

21140 ................ Elkhart-Goshen, IN, Elkhart County, IN ............................................................................................................... 0.9337 

21300 ................ Elmira, NY, Chemung County, NY ....................................................................................................................... 0.8725 

21340 ................ El Paso, TX, El Paso County, TX ........................................................................................................................ 0.8404 

21500 ................ Erie, PA, Erie County, PA .................................................................................................................................... 0.7940 

21660 ................ Eugene-Springfield, OR, Lane County, OR ......................................................................................................... 1.1723 

21780 ................ Evansville, IN–KY, Gibson County, IN, Posey County, IN, Vanderburgh County, IN, Warrick County, IN, Henderson County, KY, Webster County, KY.0.8381 

21820 ................ Fairbanks, AK, Fairbanks North Star Borough, AK .............................................................................................. 1.0997 

21940 ................ Fajardo, PR, Ceiba Municipio, PR, Fajardo Municipio, PR, Luquillo Municipio, PR ........................................... 0.3728 

22020 ................ Fargo, ND–MN, Cass County, ND, Clay County, MN ......................................................................................... 0.7802 

22140 ................ Farmington, NM, San Juan County, NM .............................................................................................................. 0.9735 

22180 ................ Fayetteville, NC, Cumberland County, NC, Hoke County, NC ............................................................................ 0.8601 

22220 ................ Fayetteville-Springdale-Rogers, AR–MO, Benton County, AR, Madison County, AR, Washington County, AR, 

McDonald County, MO.

0.8955 

22380 ................ Flagstaff, AZ, Coconino County, AZ ..................................................................................................................... 1.2786 

22420 ................ Flint, MI, Genesee County, MI ............................................................................................................................. 1.1238 

22500 ................ Florence, SC, Darlington County, SC, Florence County, SC .............................................................................. 0.7999 

22520 ................ Florence-Muscle Shoals, AL, Colbert County, AL, Lauderdale County, AL ........................................................ 0.7684 

22540 ................ Fond du Lac, WI, Fond du Lac County, WI ......................................................................................................... 0.9477 

22660 ................ Fort Collins-Loveland, CO, Larimer County, CO .................................................................................................. 0.9704 

22744 ................ Fort Lauderdale-Pompano Beach-Deerfield, FL, Broward County, FL ................................................................ 1.0378 

22900 ................ Fort Smith, AR–OK, Crawford County, AR, Franklin County, AR, Sebastian County, AR, Le Flore County, 

OK, Sequoyah County, OK.

0.7561 

23060 ................ Fort Wayne, IN, Allen County, IN, Wells County, IN, Whitley County, IN ........................................................... 0.9010 

23104 ................ Fort Worth-Arlington, TX, Johnson County, TX, Parker County, TX, Tarrant County, TX, Wise County, TX .... 0.9535 

23420 ................ Fresno, CA, Fresno County, CA .......................................................................................................................... 1.1768 

23460 ................ Gadsden, AL, Etowah County, AL ....................................................................................................................... 0.7983 

23540 ................ Gainesville, FL, Alachua County, FL, Gilchrist County, FL .................................................................................. 0.9710 

23580 ................ Gainesville, GA, Hall County, GA ......................................................................................................................... 0.9253 

23844 ................ Gary, IN, Jasper County, IN, Lake County, IN, Newton County, IN, Porter County, IN ..................................... 0.9418 

24020 ................ Glens Falls, NY, Warren County, NY, Washington County, NY .......................................................................... 0.8367 

24140 ................ Goldsboro, NC, Wayne County, NC ..................................................................................................................... 0.8550 

24220 ................ Grand Forks, ND–MN, Polk County, MN, Grand Forks County, ND ................................................................... 0.7290 

24300 ................ Grand Junction, CO, Mesa County, CO ............................................................................................................... 0.9270 

24340 ................ Grand Rapids-Wyoming, MI, Barry County, MI, Ionia County, MI, Kent County, MI, Newaygo County, MI ...... 0.9091 

24500 ................ Great Falls, MT, Cascade County, MT ................................................................................................................ 0.9235 

24540 ................ Greeley, CO, Weld County, CO ........................................................................................................................... 0.9653 

24580 ................ Green Bay, WI, Brown County, WI, Kewaunee County, WI, Oconto County, WI ............................................... 0.9587 

24660 ................ Greensboro-High Point, NC, Guilford County, NC, Randolph County, NC, Rockingham County, NC ............... 0.8320 

24780 ................ Greenville, NC, Greene County, NC, Pitt County, NC ......................................................................................... 0.9343 

24860 ................ Greenville-Mauldin-Easley, SC, Greenville County, SC, Laurens County, SC, Pickens County, SC ................. 0.9604 

25020 ................ Guayama, PR, Arroyo Municipio, PR, Guayama Municipio, PR, Patillas Municipio, PR .................................... 0.3707 

25060 ................ Gulfport-Biloxi, MS, Hancock County, MS, Harrison County, MS, Stone County, MS ........................................ 0.8575 

25180 ................ Hagerstown-Martinsburg, MD–WV, Washington County, MD, Berkeley County, WV, Morgan County, WV ...... 0.9234 

25260 ................ Hanford-Corcoran, CA, Kings County, CA ........................................................................................................... 1.1124 

25420 ................ Harrisburg-Carlisle, PA, Cumberland County, PA, Dauphin County, PA, Perry County, PA .............................. 0.9533 

25500 ................ Harrisonburg, VA, Rockingham County, VA, Harrisonburg City, VA ................................................................... 0.9090 

25540 ................ Hartford-West Hartford-East Hartford, CT, Hartford County, CT, Middlesex County, CT, Tolland County, CT 1.1050 

25620 ................ Hattiesburg, MS, Forrest County, MS, Lamar County, MS, Perry County, MS ................................................... 0.7938 

25860 ................ Hickory-Lenoir-Morganton, NC, Alexander County, NC, Burke County, NC, Caldwell County, NC, Catawba 

County, NC.

0.8492 

25980 ................ Hinesville-Fort Stewart, GA1, Liberty County, GA, Long County, GA ................................................................. 0.8700 

26100 ................ Holland-Grand Haven, MI, Ottawa County, MI .................................................................................................... 0.8016 

26180 ................ Honolulu, HI, Honolulu County, HI ....................................................................................................................... 1.2321 

26300 ................ Hot Springs, AR, Garland County, AR ................................................................................................................. 0.8474 

26380 ................ Houma-Bayou Cane-Thibodaux, LA, Lafourche Parish, LA, Terrebonne Parish, LA .......................................... 0.7525 

26420 ................ Houston-Sugar Land-Baytown, TX, Austin County, TX, Brazoria County, TX, Chambers County, TX, Fort 

Bend County, TX, Galveston County, TX, Harris County, TX, Liberty County, TX, Montgomery County, TX, 

San Jacinto County, TX, Waller County, TX.

0.9915 

26580 ................ Huntington-Ashland, WV–KY–OH, Boyd County, KY, Greenup County, KY, Lawrence County, OH, Cabell 

County, WV, Wayne County, WV.

0.8944 

26620 ................ Huntsville, AL, Limestone County, AL, Madison County, AL ............................................................................... 0.8455 

26820 ................ Idaho Falls, ID, Bonneville County, ID, Jefferson County, ID .............................................................................. 0.9312 

26900 ................ Indianapolis-Carmel, IN, Boone County, IN, Brown County, IN, Hamilton County, IN, Hancock County, IN, 

Hendricks County, IN, Johnson County, IN, Marion County, IN, Morgan County, IN, Putnam County, IN, 

Shelby County, IN.

1.0108 

26980 ................ Iowa City, IA, Johnson County, IA, Washington County, IA ................................................................................ 0.9854 

27060 ................ Ithaca, NY, Tompkins County, NY ....................................................................................................................... 0.9326 


emcdonald on DSK67QTVN1PROD with PROPOSALS2
Federal Register / Vol. 79, No. 87 / Tuesday, May 6, 2014 / Proposed Rules 26085 

TABLE 1—FY 2015 WAGE INDEX FOR URBAN AREAS BASED ON CBSA LABOR MARKET AREAS—Continued 

CBSA Code Urban area (constituent counties) Wage index 

27100 ................ Jackson, MI, Jackson County, MI ........................................................................................................................ 0.8944 

27140 ................ Jackson, MS, Copiah County, MS, Hinds County, MS, Madison County, MS, Rankin County, MS, Simpson 

County, MS.

0.8162 

27180 ................ Jackson, TN, Chester County, TN, Madison County, TN .................................................................................... 0.7729 

27260 ................ Jacksonville, FL, Baker County, FL, Clay County, FL, Duval County, FL, Nassau County, FL, St. Johns 

County, FL.

0.8956 

27340 ................ Jacksonville, NC, Onslow County, NC ................................................................................................................. 0.7861 

27500 ................ Janesville, WI, Rock County, WI .......................................................................................................................... 0.9071 

27620 ................ Jefferson City, MO, Callaway County, MO, Cole County, MO, Moniteau County, MO, Osage County, MO ..... 0.8465

27740 ................ Johnson City, TN, Carter County, TN, Unicoi County, TN, Washington County, TN .......................................... 0.7226 

27780 ................ Johnstown, PA, Cambria County, PA .................................................................................................................. 0.8450 

27860 ................ Jonesboro, AR, Craighead County, AR, Poinsett County, AR ............................................................................ 0.7983 

27900 ................ Joplin, MO, Jasper County, MO, Newton County, MO ........................................................................................ 0.7983 

28020 ................ Kalamazoo-Portage, MI, Kalamazoo County, MI, Van Buren County, MI ........................................................... 0.9959 

28100 ................ Kankakee-Bradley, IL, Kankakee County, IL ....................................................................................................... 0.9657 

28140 ................ Kansas City, MO–KS, Franklin County, KS, Johnson County, KS, Leavenworth County, KS, Linn County, 

KS, Miami County, KS, Wyandotte County, KS, Bates County, MO, Caldwell County, MO, Cass County, 

MO, Clay County, MO, Clinton County, MO, Jackson County, MO, Lafayette County, MO, Platte County, 

MO, Ray County, MO.

0.9447 

28420 ................ Kennewick-Pasco-Richland, WA, Benton County, WA, Franklin County, WA .................................................... 0.9459 

28660 ................ Killeen-Temple-Fort Hood, TX, Bell County, TX, Coryell County, TX, Lampasas County, TX ........................... 0.8925 

28700 ................ Kingsport-Bristol-Bristol, TN–VA, Hawkins County, TN, Sullivan County, TN, Bristol City, VA, Scott County,

VA, Washington County, VA.

0.7192 

28740 ................ Kingston, NY, Ulster County, NY ......................................................................................................................... 0.9066 

28940 ................ Knoxville, TN, Anderson County, TN, Blount County, TN, Knox County, TN, Loudon County, TN, Union 

County, TN.

0.7432 

29020 ................ Kokomo, IN, Howard County, IN, Tipton County, IN ........................................................................................... 0.9061 

29100 ................ La Crosse, WI–MN, Houston County, MN, La Crosse County, WI ..................................................................... 1.0205 

29140 ................ Lafayette, IN, Benton County, IN, Carroll County, IN, Tippecanoe County, IN ................................................... 0.9954 

29180 ................ Lafayette, LA, Lafayette Parish, LA, St. Martin Parish, LA .................................................................................. 0.8231 

29340 ................ Lake Charles, LA, Calcasieu Parish, LA, Cameron Parish, LA ........................................................................... 0.7765 

29404 ................ Lake County-Kenosha County, IL–WI, Lake County, IL, Kenosha County, WI ................................................... 1.0658 

29420 ................ Lake Havasu City-Kingman, AZ, Mohave County, AZ ......................................................................................... 0.9912 

29460 ................ Lakeland-Winter Haven, FL, Polk County, FL ...................................................................................................... 0.8283 

29540 ................ Lancaster, PA, Lancaster County, PA .................................................................................................................. 0.9695 

29620 ................ Lansing-East Lansing, MI, Clinton County, MI, Eaton County, MI, Ingham County, MI ..................................... 1.0618 

29700 ................ Laredo, TX, Webb County, TX ............................................................................................................................. 0.7586 

29740 ................ Las Cruces, NM, Dona Ana County, NM ............................................................................................................. 0.9265 

29820 ................ Las Vegas-Paradise, NV, Clark County, NV ........................................................................................................ 1.1627 

29940 ................ Lawrence, KS, Douglas County, KS .................................................................................................................... 0.8664 

30020 ................ Lawton, OK, Comanche County, OK ................................................................................................................... 0.7893 

30140 ................ Lebanon, PA, Lebanon County, PA ..................................................................................................................... 0.8157 

30300 ................ Lewiston, ID–WA, Nez Perce County, ID, Asotin County, WA ............................................................................ 0.9215 

30340 ................ Lewiston-Auburn, ME, Androscoggin County, ME ............................................................................................... 0.9048 

30460 ................ Lexington-Fayette, KY, Bourbon County, KY, Clark County, KY, Fayette County, KY, Jessamine County, KY, 

Scott County, KY, Woodford County, KY.

0.8902 

30620 ................ Lima, OH, Allen County, OH ................................................................................................................................ 0.9158 

30700 ................ Lincoln, NE, Lancaster County, NE, Seward County, NE ................................................................................... 0.9465 

30780 ................ Little Rock-North Little Rock-Conway, AR, Faulkner County, AR, Grant County, AR, Lonoke County, AR, 

Perry County, AR, Pulaski County, AR, Saline County, AR.

0.8632 

30860 ................ Logan, UT–ID, Franklin County, ID, Cache County, UT ...................................................................................... 0.8754 

30980 ................ Longview, TX, Gregg County, TX, Rusk County, TX, Upshur County, TX ......................................................... 0.8933 

31020 ................ Longview, WA, Cowlitz County, WA .................................................................................................................... 1.0460 

31084 ................ Los Angeles-Long Beach-Glendale, CA, Los Angeles County, CA ..................................................................... 1.2417 

31140 ................ Louisville-Jefferson County, KY–IN, Clark County, IN, Floyd County, IN, Harrison County, IN, Washington 

County, IN, Bullitt County, KY, Henry County, KY, Meade County, KY, Nelson County, KY, Oldham County, KY, Shelby County, KY, Spencer County, KY, Trimble County, KY.

0.8852 

31180 ................ Lubbock, TX, Crosby County, TX, Lubbock County, TX ..................................................................................... 0.8956 

31340 ................ Lynchburg, VA, Amherst County, VA, Appomattox County, VA, Bedford County, VA, Campbell County, VA, 

Bedford City, VA, Lynchburg City, VA.

0.8771 

31420 ................ Macon, GA, Bibb County, GA, Crawford County, GA, Jones County, GA, Monroe County, GA, Twiggs County, GA.0.9014 

31460 ................ Madera-Chowchilla, CA, Madera County, CA ...................................................................................................... 0.8317 

31540 ................ Madison, WI, Columbia County, WI, Dane County, WI, Iowa County, WI .......................................................... 1.1414 

31700 ................ Manchester-Nashua, NH, Hillsborough County, NH ............................................................................................ 1.0057 

31740 ................ Manhattan, KS, Geary County, KS, Pottawatomie County, KS, Riley County, KS ............................................. 0.7843 

31860 ................ Mankato-North Mankato, MN, Blue Earth County, MN, Nicollet County, MN ..................................................... 0.9277 

31900 ................ Mansfield, OH, Richland County, OH ................................................................................................................... 0.8509 

32420 ................ Mayagu ̈ez, PR, Hormigueros Municipio, PR, Mayagu ̈ez Municipio, PR ............................................................. 0.3762 

32580 ................ McAllen-Edinburg-Mission, TX, Hidalgo County, TX ............................................................................................ 0.8393 

32780 ................ Medford, OR, Jackson County, OR ...................................................................................................................... 1.0690 


emcdonald on DSK67QTVN1PROD with PROPOSALS2
26086 Federal Register / Vol. 79, No. 87 / Tuesday, May 6, 2014 / Proposed Rules 

TABLE 1—FY 2015 WAGE INDEX FOR URBAN AREAS BASED ON CBSA LABOR MARKET AREAS—Continued 

CBSA Code Urban area (constituent counties) Wage index 

32820 ................ Memphis, TN–MS–AR, Crittenden County, AR, DeSoto County, MS, Marshall County, MS, Tate County, MS, 

Tunica County, MS, Fayette County, TN, Shelby County, TN, Tipton County, TN.

0.9038 

32900 ................ Merced, CA, Merced County, CA ......................................................................................................................... 1.2734 

33124 ................ Miami-Miami Beach-Kendall, FL, Miami-Dade County, FL .................................................................................. 0.9870 

33140 ................ Michigan City-La Porte, IN, LaPorte County, IN .................................................................................................. 0.9216 

33260 ................ Midland, TX, Midland County, TX ........................................................................................................................ 1.0049 

33340 ................ Milwaukee-Waukesha-West Allis, WI, Milwaukee County, WI, Ozaukee County, WI, Washington County, WI, 

Waukesha County, WI.

0.9856 

33460 ................ Minneapolis-St. Paul-Bloomington, MN–WI, Anoka County, MN, Carver County, MN, Chisago County, MN, 

Dakota County, MN, Hennepin County, MN, Isanti County, MN, Ramsey County, MN, Scott County, MN, 

Sherburne County, MN, Washington County, MN, Wright County, MN, Pierce County, WI, St. Croix County, WI.

1.1213 

33540 ................ Missoula, MT, Missoula County, MT .................................................................................................................... 0.9142 

33660 ................ Mobile, AL, Mobile County, AL ............................................................................................................................. 0.7507 

33700 ................ Modesto, CA, Stanislaus County, CA .................................................................................................................. 1.3629 

33740 ................ Monroe, LA, Ouachita Parish, LA, Union Parish, LA ........................................................................................... 0.7530 

33780 ................ Monroe, MI, Monroe County, MI .......................................................................................................................... 0.8718 

33860 ................ Montgomery, AL, Autauga County, AL, Elmore County, AL, Lowndes County, AL, Montgomery County, AL ... 0.7475 

34060 ................ Morgantown, WV, Monongalia County, WV, Preston County, WV ...................................................................... 0.8339 

34100 ................ Morristown, TN, Grainger County, TN, Hamblen County, TN, Jefferson County, TN ......................................... 0.6861 

34580 ................ Mount Vernon-Anacortes, WA, Skagit County, WA ............................................................................................. 1.0652 

34620 ................ Muncie, IN, Delaware County, IN ......................................................................................................................... 0.8743 

34740 ................ Muskegon-Norton Shores, MI, Muskegon County, MI ......................................................................................... 1.1076 

34820 ................ Myrtle Beach-North Myrtle Beach-Conway, SC, Horry County, SC .................................................................... 0.8700 

34900 ................ Napa, CA, Napa County, CA ................................................................................................................................ 1.5375 

34940 ................ Naples-Marco Island, FL, Collier County, FL ....................................................................................................... 0.9108 

34980 ................ Nashville-Davidson—Murfreesboro-Franklin, TN, Cannon County, TN, Cheatham County, TN, Davidson 

County, TN, Dickson County, TN, Hickman County, TN, Macon County, TN, Robertson County, TN, Rutherford County, TN, Smith County, TN, Sumner County, TN, Trousdale County, TN, Williamson County, 

TN, Wilson County, TN.

0.9141 

35004 ................ Nassau-Suffolk, NY, Nassau County, NY, Suffolk County, NY ........................................................................... 1.2755 

35084 ................ Newark-Union, NJ-PA, Essex County, NJ, Hunterdon County, NJ, Morris County, NJ, Sussex County, NJ, 

Union County, NJ, Pike County, PA.

1.1268 

35300 ................ New Haven-Milford, CT, New Haven County, CT ................................................................................................ 1.1883 

35380 ................ New Orleans-Metairie-Kenner, LA, Jefferson Parish, LA, Orleans Parish, LA, Plaquemines Parish, LA, St. 

Bernard Parish, LA, St. Charles Parish, LA, St. John the Baptist Parish, LA, St. Tammany Parish, LA.

0.8752 

35644 ................ New York-White Plains-Wayne, NY-NJ, Bergen County, NJ, Hudson County, NJ, Passaic County, NJ, Bronx 

County, NY, Kings County, NY, New York County, NY, Putnam County, NY, Queens County, NY, Richmond County, NY, Rockland County, NY, Westchester County, NY.

1.3089 

35660 ................ Niles-Benton Harbor, MI, Berrien County, MI ...................................................................................................... 0.8444 

35840 ................ North Port-Bradenton-Sarasota-Venice, FL, Manatee County, FL, Sarasota County, FL ................................... 0.9428 

35980 ................ Norwich-New London, CT, New London County, CT .......................................................................................... 1.1821 

36084 ................ Oakland-Fremont-Hayward, CA, Alameda County, CA, Contra Costa County, CA ............................................ 1.7048 

36100 ................ Ocala, FL, Marion County, FL .............................................................................................................................. 0.8425 

36140 ................ Ocean City, NJ, Cape May County, NJ ............................................................................................................... 1.0584 

36220 ................ Odessa, TX, Ector County, TX ............................................................................................................................. 0.9661 

36260 ................ Ogden-Clearfield, UT, Davis County, UT, Morgan County, UT, Weber County, UT ........................................... 0.9170 

36420 ................ Oklahoma City, OK, Canadian County, OK, Cleveland County, OK, Grady County, OK, Lincoln County, OK, 

Logan County, OK, McClain County, OK, Oklahoma County, OK.

0.8879 

36500 ................ Olympia, WA, Thurston County, WA .................................................................................................................... 1.1601 

36540 ................ Omaha-Council Bluffs, NE–IA, Harrison County, IA, Mills County, IA, Pottawattamie County, IA, Cass County, NE, Douglas County, NE, Sarpy County, NE, Saunders County, NE, Washington County, NE.0.9756 

36740 ................ Orlando-Kissimmee-Sanford, FL, Lake County, FL, Orange County, FL, Osceola County, FL, Seminole 

County, FL.

0.9063 

36780 ................ Oshkosh-Neenah, WI, Winnebago County, WI .................................................................................................... 0.9398 

36980 ................ Owensboro, KY, Daviess County, KY, Hancock County, KY, McLean County, KY ............................................ 0.7790 

37100 ................ Oxnard-Thousand Oaks-Ventura, CA, Ventura County, CA ................................................................................ 1.3113 

37340 ................ Palm Bay-Melbourne-Titusville, FL, Brevard County, FL ..................................................................................... 0.8790 

37380 ................ Palm Coast, FL, Flagler County, FL ..................................................................................................................... 0.8174 

37460 ................ Panama City-Lynn Haven-Panama City Beach, FL, Bay County, FL ................................................................. 0.7876 

37620 ................ Parkersburg-Marietta-Vienna, WV–OH, Washington County, OH, Pleasants County, WV, Wirt County, WV, 

Wood County, WV.

0.7569 

37700 ................ Pascagoula, MS, George County, MS, Jackson County, MS .............................................................................. 0.7542 

37764 ................ Peabody, MA, Essex County, MA ........................................................................................................................ 1.0553 

37860 ................ Pensacola-Ferry Pass-Brent, FL, Escambia County, FL, Santa Rosa County, FL ............................................. 0.7767 

37900 ................ Peoria, IL, Marshall County, IL, Peoria County, IL, Stark County, IL, Tazewell County, IL, Woodford County, 

IL.

0.8434 

37964 ................ Philadelphia, PA, Bucks County, PA, Chester County, PA, Delaware County, PA, Montgomery County, PA, 

Philadelphia County, PA.

1.0849 

38060 ................ Phoenix-Mesa-Scottsdale, AZ, Maricopa County, AZ, Pinal County, AZ ............................................................ 1.0465 

38220 ................ Pine Bluff, AR, Cleveland County, AR, Jefferson County, AR, Lincoln County, AR ........................................... 0.8069 


emcdonald on DSK67QTVN1PROD with PROPOSALS2
Federal Register / Vol. 79, No. 87 / Tuesday, May 6, 2014 / Proposed Rules 26087 

TABLE 1—FY 2015 WAGE INDEX FOR URBAN AREAS BASED ON CBSA LABOR MARKET AREAS—Continued 

CBSA Code Urban area (constituent counties) Wage index 

38300 ................ Pittsburgh, PA, Allegheny County, PA, Armstrong County, PA, Beaver County, PA, Butler County, PA, Fayette County, PA, Washington County, PA, Westmoreland County, PA.0.8669 

38340 ................ Pittsfield, MA, Berkshire County, MA ................................................................................................................... 1.0920 

38540 ................ Pocatello, ID, Bannock County, ID, Power County, ID ........................................................................................ 0.9754 

38660 ................ Ponce, PR, Juana Dı ́az Municipio, PR, Ponce Municipio, PR, Villalba Municipio, PR ....................................... 0.4594 

38860 ................ Portland-South Portland-Biddeford, ME, Cumberland County, ME, Sagadahoc County, ME, York County, ME 0.9981

38900 ................ Portland-Vancouver-Hillsboro, OR–WA, Clackamas County, OR, Columbia County, OR, Multnomah County, 

OR, Washington County, OR, Yamhill County, OR, Clark County, WA, Skamania County, WA.

1.1766 

38940 ................ Port St. Lucie, FL, Martin County, FL, St. Lucie County, FL ............................................................................... 0.9352 

39100 ................ Poughkeepsie-Newburgh-Middletown, NY, Dutchess County, NY, Orange County, NY .................................... 1.1544 

39140 ................ Prescott, AZ, Yavapai County, AZ ....................................................................................................................... 1.0161 

39300 ................ Providence-New Bedford-Fall River, RI–MA, Bristol County, MA, Bristol County, RI, Kent County, RI, Newport County, RI, Providence County, RI, Washington County, RI.1.0539 

39340 ................ Provo-Orem, UT, Juab County, UT, Utah County, UT ........................................................................................ 0.9461 

39380 ................ Pueblo, CO, Pueblo County, CO ......................................................................................................................... 0.8215 

39460 ................ Punta Gorda, FL, Charlotte County, FL ............................................................................................................... 0.8734 

39540 ................ Racine, WI, Racine County, WI ............................................................................................................................ 0.8903 

39580 ................ Raleigh-Cary, NC, Franklin County, NC, Johnston County, NC, Wake County, NC .......................................... 0.9304 

39660 ................ Rapid City, SD, Meade County, SD, Pennington County, SD ............................................................................. 0.9568 

39740 ................ Reading, PA, Berks County, PA ........................................................................................................................... 0.9220 

39820 ................ Redding, CA, Shasta County, CA ........................................................................................................................ 1.4990 

39900 ................ Reno-Sparks, NV, Storey County, NV, Washoe County, NV .............................................................................. 1.0326 

40060 ................ Richmond, VA, Amelia County, VA, Caroline County, VA, Charles City County, VA, Chesterfield County, VA, 

Cumberland County, VA, Dinwiddie County, VA, Goochland County, VA, Hanover County, VA, Henrico 

County, VA, King and Queen County, VA, King William County, VA, Louisa County, VA, New Kent County, VA, Powhatan County, VA, Prince George County, VA, Sussex County, VA, Colonial Heights City, VA, 

Hopewell City, VA, Petersburg City, VA, Richmond City, VA.

0.9723 

40140 ................ Riverside-San Bernardino-Ontario, CA, Riverside County, CA, San Bernardino County, CA ............................ 1.1497 

40220 ................ Roanoke, VA, Botetourt County, VA, Craig County, VA, Franklin County, VA, Roanoke County, VA, Roanoke 

City, VA, Salem City, VA.

0.9195 

40340 ................ Rochester, MN, Dodge County, MN, Olmsted County, MN, Wabasha County, MN ........................................... 1.1662 

40380 ................ Rochester, NY, Livingston County, NY, Monroe County, NY, Ontario County, NY, Orleans County, NY, 

Wayne County, NY.

0.8749 

40420 ................ Rockford, IL, Boone County, IL, Winnebago County, IL ...................................................................................... 0.9751 

40484 ................ Rockingham County-Strafford County, NH, Rockingham County, NH, Strafford County, NH ............................ 1.0172 

40580 ................ Rocky Mount, NC, Edgecombe County, NC, Nash County, NC ......................................................................... 0.8750 

40660 ................ Rome, GA, Floyd County, GA .............................................................................................................................. 0.8924 

40900 ................ Sacramento-Arden-Arcade-Roseville, CA, El Dorado County, CA, Placer County, CA, Sacramento County, 

CA, Yolo County, CA.

1.5498 

40980 ................ Saginaw-Saginaw Township North, MI, Saginaw County, MI .............................................................................. 0.8849 

41060 ................ St. Cloud, MN, Benton County, MN, Stearns County, MN .................................................................................. 1.0658 

41100 ................ St. George, UT, Washington County, UT ............................................................................................................. 0.9345 

41140 ................ St. Joseph, MO–KS, Doniphan County, KS, Andrew County, MO, Buchanan County, MO, DeKalb County, 

MO.

0.9834 

41180 ................ St. Louis, MO–IL, Bond County, IL, Calhoun County, IL, Clinton County, IL, Jersey County, IL, Macoupin 

County, IL, Madison County, IL, Monroe County, IL, St. Clair County, IL, Crawford County, MO, Franklin 

County, MO, Jefferson County, MO, Lincoln County, MO, St. Charles County, MO, St. Louis County, MO, 

Warren County, MO, Washington County, MO, St. Louis City, MO.

0.9336 

41420 ................ Salem, OR, Marion County, OR, Polk County, OR ............................................................................................. 1.1148 

41500 ................ Salinas, CA, Monterey County, CA ...................................................................................................................... 1.5820 

41540 ................ Salisbury, MD, Somerset County, MD, Wicomico County, MD ........................................................................... 0.8948 

41620 ................ Salt Lake City, UT, Salt Lake County, UT, Summit County, UT, Tooele County, UT ......................................... 0.9350 

41660 ................ San Angelo, TX, Irion County, TX, Tom Green County, TX ................................................................................ 0.8169 

41700 ................ San Antonio-New Braunfels, TX, Atascosa County, TX, Bandera County, TX, Bexar County, TX, Comal 

County, TX, Guadalupe County, TX, Kendall County, TX, Medina County, TX, Wilson County, TX.

0.8911 

41740 ................ San Diego-Carlsbad-San Marcos, CA, San Diego County, CA ........................................................................... 1.2213 

41780 ................ Sandusky, OH, Erie County, OH .......................................................................................................................... 0.7788 

41884 ................ San Francisco-San Mateo-Redwood City, CA, Marin County, CA, San Francisco County, CA, San Mateo 

County, CA.

1.6743 

41900 ................ San Germa ́n-Cabo Rojo, PR, Cabo Rojo Municipio, PR, Lajas Municipio, PR, Sabana Grande Municipio, 

PR, San Germa ́n Municipio, PR.

0.4550 

41940 ................ San Jose-Sunnyvale-Santa Clara, CA, San Benito County, CA, Santa Clara County, CA ................................ 1.7086 


emcdonald on DSK67QTVN1PROD with PROPOSALS2
26088 Federal Register / Vol. 79, No. 87 / Tuesday, May 6, 2014 / Proposed Rules 

TABLE 1—FY 2015 WAGE INDEX FOR URBAN AREAS BASED ON CBSA LABOR MARKET AREAS—Continued 

CBSA Code Urban area (constituent counties) Wage index 

41980 ................ San Juan-Caguas-Guaynabo, PR, Aguas Buenas Municipio, PR, Aibonito Municipio, PR, Arecibo Municipio, 

PR, Barceloneta Municipio, PR, Barranquitas Municipio, PR, Bayamo ́n Municipio, PR, Caguas Municipio, 

PR, Camuy Municipio, PR, Cano ́vanas Municipio, PR, Carolina Municipio, PR, Catan ̃o Municipio, PR, 

Cayey Municipio, PR, Ciales Municipio, PR, Cidra Municipio, PR, Comerı ́o Municipio, PR, Corozal 

Municipio, PR, Dorado Municipio, PR, Florida Municipio, PR, Guaynabo Municipio, PR, Gurabo Municipio, 

PR, Hatillo Municipio, PR, Humacao Municipio, PR, Juncos Municipio, PR, Las Piedras Municipio, PR, 

Loı ́za Municipio, PR, Manatı ́ Municipio, PR, Maunabo Municipio, PR, Morovis Municipio, PR, Naguabo 

Municipio, PR, Naranjito Municipio, PR, Orocovis Municipio, PR, Quebradillas Municipio, PR, Rı ́o Grande 

Municipio, PR, San Juan Municipio, PR, San Lorenzo Municipio, PR, Toa Alta Municipio, PR, Toa Baja 

Municipio, PR, Trujillo Alto Municipio, PR, Vega Alta Municipio, PR, Vega Baja Municipio, PR, Yabucoa 

Municipio, PR.

0.4356 

42020 ................ San Luis Obispo-Paso Robles, CA, San Luis Obispo County, CA ..................................................................... 1.3036 

42044 ................ Santa Ana-Anaheim-Irvine, CA, Orange County, CA .......................................................................................... 1.2111 

42060 ................ Santa Barbara-Santa Maria-Goleta, CA, Santa Barbara County, CA ................................................................. 1.2825 

42100 ................ Santa Cruz-Watsonville, CA, Santa Cruz County, CA ......................................................................................... 1.7937 

42140 ................ Santa Fe, NM, Santa Fe County, NM .................................................................................................................. 1.0136 

42220 ................ Santa Rosa-Petaluma, CA, Sonoma County, CA ................................................................................................ 1.6679 

42340 ................ Savannah, GA, Bryan County, GA, Chatham County, GA, Effingham County, GA ............................................ 0.8757 

42540 ................ Scranton—Wilkes-Barre, PA, Lackawanna County, PA, Luzerne County, PA, Wyoming County, PA ............... 0.8331 

42644 ................ Seattle-Bellevue-Everett, WA, King County, WA, Snohomish County, WA ........................................................ 1.1733 

42680 ................ Sebastian-Vero Beach, FL, Indian River County, FL ........................................................................................... 0.8760 

43100 ................ Sheboygan, WI, Sheboygan County, WI .............................................................................................................. 0.9203 

43300 ................ Sherman-Denison, TX, Grayson County, TX ....................................................................................................... 0.8723 

43340 ................ Shreveport-Bossier City, LA, Bossier Parish, LA, Caddo Parish, LA, De Soto Parish, LA ................................. 0.8262 

43580 ................ Sioux City, IA–NE–SD, Woodbury County, IA, Dakota County, NE, Dixon County, NE, Union County, SD ..... 0.9163 

43620 ................ Sioux Falls, SD, Lincoln County, SD, McCook County, SD, Minnehaha County, SD, Turner County, SD ........ 0.8275 

43780 ................ South Bend-Mishawaka, IN–MI, St. Joseph County, IN, Cass County, MI ......................................................... 0.9425 

43900 ................ Spartanburg, SC, Spartanburg County, SC ......................................................................................................... 0.8782 

44060 ................ Spokane, WA, Spokane County, WA ................................................................................................................... 1.1174 

44100 ................ Springfield, IL, Menard County, IL, Sangamon County, IL .................................................................................. 0.9165 

44140 ................ Springfield, MA, Franklin County, MA, Hampden County, MA, Hampshire County, MA .................................... 1.0383 

44180 ................ Springfield, MO, Christian County, MO, Dallas County, MO, Greene County, MO, Polk County, MO, Webster 

County, MO.

0.8440 

44220 ................ Springfield, OH, Clark County, OH ....................................................................................................................... 0.8447 

44300 ................ State College, PA, Centre County, PA ................................................................................................................. 0.9575 

44600 ................ Steubenville-Weirton, OH–WV, Jefferson County, OH, Brooke County, WV, Hancock County, WV ................. 0.7598 

44700 ................ Stockton, CA, San Joaquin County, CA ............................................................................................................... 1.3734 

44940 ................ Sumter, SC, Sumter County, SC .......................................................................................................................... 0.7594 

45060 ................ Syracuse, NY, Madison County, NY, Onondaga County, NY, Oswego County, NY .......................................... 0.9897 

45104 ................ Tacoma, WA, Pierce County, WA ........................................................................................................................ 1.1574 

45220 ................ Tallahassee, FL, Gadsden County, FL, Jefferson County, FL, Leon County, FL, Wakulla County, FL ............. 0.8391 

45300 ................ Tampa-St. Petersburg-Clearwater, FL, Hernando County, FL, Hillsborough County, FL, Pasco County, FL, 

Pinellas County, FL.

0.9075 

45460 ................ Terre Haute, IN, Clay County, IN, Sullivan County, IN, Vermillion County, IN, Vigo County, IN ........................ 0.9706 

45500 ................ Texarkana, TX-Texarkana, AR, Miller County, AR, Bowie County, TX ............................................................... 0.7428 

45780 ................ Toledo, OH, Fulton County, OH, Lucas County, OH, Ottawa County, OH, Wood County, OH ......................... 0.9013 

45820 ................ Topeka, KS, Jackson County, KS, Jefferson County, KS, Osage County, KS, Shawnee County, KS, 

Wabaunsee County, KS.

0.8974 

45940 ................ Trenton-Ewing, NJ, Mercer County, NJ ............................................................................................................... 1.0648 

46060 ................ Tucson, AZ, Pima County, AZ .............................................................................................................................. 0.8953 

46140 ................ Tulsa, OK, Creek County, OK, Okmulgee County, OK, Osage County, OK, Pawnee County, OK, Rogers 

County, OK, Tulsa County, OK, Wagoner County, OK.

0.8145 

46220 ................ Tuscaloosa, AL, Greene County, AL, Hale County, AL, Tuscaloosa County, AL ............................................... 0.8500 

46340 ................ Tyler, TX, Smith County, TX ................................................................................................................................ 0.8526 

46540 ................ Utica-Rome, NY, Herkimer County, NY, Oneida County, NY .............................................................................. 0.8769 

46660 ................ Valdosta, GA, Brooks County, GA, Echols County, GA, Lanier County, GA, Lowndes County, GA ................. 0.7527 

46700 ................ Vallejo-Fairfield, CA, Solano County, CA ............................................................................................................. 1.6286 

47020 ................ Victoria, TX, Calhoun County, TX, Goliad County, TX, Victoria County, TX ....................................................... 0.8949 

47220 ................ Vineland-Millville-Bridgeton, NJ, Cumberland County, NJ ................................................................................... 1.0759 

47260 ................ Virginia Beach-Norfolk-Newport News, VA–NC, Currituck County, NC, Gloucester County, VA, Isle of Wight 

County, VA, James City County, VA, Mathews County, VA, Surry County, VA, York County, VA, Chesapeake City, VA, Hampton City, VA, Newport News City, VA, Norfolk City, VA, Poquoson City, VA, Portsmouth City, VA, Suffolk City, VA, Virginia Beach City, VA, Williamsburg City, VA.

0.9121 

47300 ................ Visalia-Porterville, CA, Tulare County, CA ........................................................................................................... 0.9947 

47380 ................ Waco, TX, McLennan County, TX ........................................................................................................................ 0.8213 

47580 ................ Warner Robins, GA, Houston County, GA ........................................................................................................... 0.7732 

47644 ................ Warren-Troy-Farmington Hills, MI, Lapeer County, MI, Livingston County, MI, Macomb County, MI, Oakland 

County, MI, St. Clair County, MI.

0.9432 


emcdonald on DSK67QTVN1PROD with PROPOSALS2
Federal Register / Vol. 79, No. 87 / Tuesday, May 6, 2014 / Proposed Rules 26089 

TABLE 1—FY 2015 WAGE INDEX FOR URBAN AREAS BASED ON CBSA LABOR MARKET AREAS—Continued 

CBSA Code Urban area (constituent counties) Wage index 

47894 ................ Washington-Arlington-Alexandria, DC–VA–MD–WV, District of Columbia, DC, Calvert County, MD, Charles 

County, MD, Prince George’s County, MD, Arlington County, VA, Clarke County, VA, Fairfax County, VA, 

Fauquier County, VA, Loudoun County, VA, Prince William County, VA, Spotsylvania County, VA, Stafford 

County, VA, Warren County, VA, Alexandria City, VA, Fairfax City, VA, Falls Church City, VA, Fredericksburg City, VA, Manassas City, VA, Manassas Park City, VA, Jefferson County, WV.

1.0533 

47940 ................ Waterloo-Cedar Falls, IA, Black Hawk County, IA, Bremer County, IA, Grundy County, IA .............................. 0.8331 

48140 ................ Wausau, WI, Marathon County, WI ...................................................................................................................... 0.8802 

48300 ................ Wenatchee-East Wenatchee, WA, Chelan County, WA, Douglas County, WA .................................................. 1.0109 

48424 ................ West Palm Beach-Boca Raton-Boynton Beach, FL, Palm Beach County, FL .................................................... 0.9597 

48540 ................ Wheeling, WV–OH, Belmont County, OH, Marshall County, WV, Ohio County, WV ......................................... 0.6673 

48620 ................ Wichita, KS, Butler County, KS, Harvey County, KS, Sedgwick County, KS, Sumner County, KS ................... 0.8674 

48660 ................ Wichita Falls, TX, Archer County, TX, Clay County, TX, Wichita County, TX .................................................... 0.9537 

48700 ................ Williamsport, PA, Lycoming County, PA .............................................................................................................. 0.8268 

48864 ................ Wilmington, DE–MD–NJ, New Castle County, DE, Cecil County, MD, Salem County, NJ ................................ 1.0593 

48900 ................ Wilmington, NC, Brunswick County, NC, New Hanover County, NC, Pender County, NC ................................ 0.8862 

49020 ................ Winchester, VA–WV, Frederick County, VA, Winchester City, VA, Hampshire County, WV .............................. 0.9034 

49180 ................ Winston-Salem, NC, Davie County, NC, Forsyth County, NC, Stokes County, NC, Yadkin County, NC .......... 0.8560 

49340 ................ Worcester, MA, Worcester County, MA ............................................................................................................... 1.1584 

49420 ................ Yakima, WA, Yakima County, WA ....................................................................................................................... 1.0355 

49500 ................ Yauco, PR, Gua ́nica Municipio, PR, Guayanilla Municipio, PR, Pen ̃uelas Municipio, PR, Yauco Municipio, 

PR.

0.3782 

49620 ................ York-Hanover, PA, York County, PA .................................................................................................................... 0.9540 

49660 ................ Youngstown-Warren-Boardman, OH–PA, Mahoning County, OH, Trumbull County, OH, Mercer County, PA 0.8262 

49700 ................ Yuba City, CA, Sutter County, CA, Yuba County, CA ......................................................................................... 1.1759 

49740 ................ Yuma, AZ, Yuma County, AZ ............................................................................................................................... 0.9674 

1 At this time, there are no hospitals 

located in this urban area on which to base 

a wage index. 

TABLE 2—FY 2015 WAGE INDEX

BASED ON CBSA LABOR MARKET

AREAS FOR RURAL AREAS

State 

code Nonurban area Wage index 

1 .......... Alabama ...................... 0.7147 

2 .......... Alaska ......................... 1.3662 

3 .......... Arizona ........................ 0.9166 

4 .......... Arkansas ..................... 0.7343 

5 .......... California ..................... 1.2788 

6 .......... Colorado ...................... 0.9802 

7 .......... Connecticut ................. 1.1311 

8 .......... Delaware ..................... 1.0092 

10 ........ Florida ......................... 0.7985 

11 ........ Georgia ....................... 0.7459 

12 ........ Hawaii ......................... 1.0739 

13 ........ Idaho ........................... 0.7605 

14 ........ Illinois .......................... 0.8434 

15 ........ Indiana ........................ 0.8513 

16 ........ Iowa ............................. 0.8434 

17 ........ Kansas ........................ 0.7929 

18 ........ Kentucky ..................... 0.7784 

19 ........ Louisiana ..................... 0.7585 

20 ........ Maine .......................... 0.8238 

TABLE 2—FY 2015 WAGE INDEX

BASED ON CBSA LABOR MARKET

AREAS FOR RURAL AREAS—Continued 

State 

code Nonurban area Wage index 

21 ........ Maryland ..................... 0.8696 

22 ........ Massachusetts ............ 1.3614 

23 ........ Michigan ...................... 0.8270 

24 ........ Minnesota .................... 0.9133 

25 ........ Mississippi ................... 0.7568 

26 ........ Missouri ....................... 0.7775 

27 ........ Montana ...................... 0.9098 

28 ........ Nebraska ..................... 0.8855 

29 ........ Nevada ........................ 0.9781 

30 ........ New Hampshire ........... 1.0339 

31 ........ New Jersey 1 ............... ................

32 ........ New Mexico ................ 0.8922 

33 ........ New York .................... 0.8220 

34 ........ North Carolina ............. 0.8100 

35 ........ North Dakota ............... 0.6785 

36 ........ Ohio ............................. 0.8377 

37 ........ Oklahoma .................... 0.7704 

38 ........ Oregon ........................ 0.9435 

39 ........ Pennsylvania ............... 0.8430 

40 ........ Puerto Rico 1 ............... 0.4047 

41 ........ Rhode Island 1 ............. ................

42 ........ South Carolina ............ 0.8329 

TABLE 2—FY 2015 WAGE INDEX

BASED ON CBSA LABOR MARKET

AREAS FOR RURAL AREAS—Continued 

State 

code Nonurban area Wage index 

43 ........ South Dakota .............. 0.8164 

44 ........ Tennessee .................. 0.7444 

45 ........ Texas .......................... 0.7874 

46 ........ Utah ............................. 0.8732 

47 ........ Vermont ....................... 0.9740 

48 ........ Virgin Islands .............. 0.7060 

49 ........ Virginia ........................ 0.7758 

50 ........ Washington ................. 1.0529 

51 ........ West Virginia ............... 0.7407 

52 ........ Wisconsin .................... 0.8904 

53 ........ Wyoming ..................... 0.9243 

65 ........ Guam .......................... 0.9611 

1All counties within the State are classified 

as urban, with the exception of Puerto Rico. 

Puerto Rico has areas designated as rural; 

however, no short-term, acute care hospitals 

are located in the area(s) for FY 2015. The 

Puerto Rico wage index is the same as FY 

2014. 

Addendum C 

IPF CODE FIRST TABLE

Code Code First Instructions ICD–10–CM (effective October 1, 2014) 

F01.50 .............. Code first the underlying physiological condition or sequelae of cerebrovascular disease 

F01.51 .............. Code first the underlying physiological condition or sequelae of cerebrovascular disease 

F02.80 .............. Code first the underlying physiological condition, such as: A52.17, A81.0–A81.9, E75.00–E75.09, E75.10–E75.19, E75.4, 

E83.00–E83.09, G10, G30.0–G30.9, G31.01, G31.09, G31.83, G35, G40.001–G40.319, G40.401–G40.919, G40.A01– 

G40.B19, M30.8 This list is a translation of the ICD–9 codes rather than a list of the conditions in the ICD–10 codebook 

code first note for category F02. 


emcdonald on DSK67QTVN1PROD with PROPOSALS2
26090 Federal Register / Vol. 79, No. 87 / Tuesday, May 6, 2014 / Proposed Rules 

IPF CODE FIRST TABLE—Continued 

Code Code First Instructions ICD–10–CM (effective October 1, 2014) 

F02.81 .............. Code first the underlying physiological condition, such as: A52.17, A81.0–A81.9, E75.00–E75.09, E75.10–E75.19, E75.4, 

E83.00–E83.09, G10, G30.0–G30.9, G31.01, G31.09, G31.83, G35, G40.001–G40.319, G40.401–G40.919, G40.A01– 

G40.B19, M30.8 

F04 ................... Code first the underlying physiological condition 

F05 ................... Code first the underlying physiological condition, such as: A52.17, A81.0–A81.9, E75.00–E75.09, E75.10–E75.19, E75.4, 

E83.00–E83.09, G10, G30.0–G30.9, G31.01, G31.09, G31.83, G35, G40.001–G40.319, G40.401–G40.919, G40.A01– 

G40.B19, M30.8 

F06.0 ................ Code first the underlying physiological condition 

F06.1 ................ Code first the underlying physiological condition 

F06.2 ................ Code first the underlying physiological condition 

F06.30 .............. Code first the underlying physiological condition 

F06.31 .............. Code first the underlying physiological condition 

F06.32 .............. Code first the underlying physiological condition 

F06.33 .............. Code first the underlying physiological condition 

F06.34 .............. Code first the underlying physiological condition 

F06.4 ................ Code first the underlying physiological condition 

F06.8 ................ Code first the underlying physiological condition 

F45.42 .............. Code also associated acute or chronic pain 

[FR Doc. 2014–10306 Filed 5–1–14; 4:15 pm] 

BILLING CODE 4120–01–P 


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