Tuesday, 

May 8, 2007 

Part III 

Department of 

Health and Human 

Services 

Centers for Medicare & Medicaid Services 

42 CFR Part 412 

Medicare Program; Inpatient 

Rehabilitation Facility Prospective 

Payment System for Federal Fiscal Year 

2008; Proposed Rule 


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26230 Federal Register / Vol. 72, No. 88 / Tuesday, May 8, 2007 / Proposed Rules 

DEPARTMENT OF HEALTH AND 

HUMAN SERVICES 

Centers for Medicare & Medicaid 

Services 

42 CFR Part 412 

[CMS–1551–P] 

RIN 0938–AO63 

Medicare Program; Inpatient 

Rehabilitation Facility Prospective 

Payment System for Federal Fiscal 

Year 2008 

AGENCY: Centers for Medicare & 

Medicaid Services (CMS), HHS. 

ACTION: Proposed rule. 

SUMMARY: This proposed rule would 

update the prospective payment rates 

for inpatient rehabilitation facilities 

(IRFs) for Federal fiscal year (FY) 2008 

(for discharges occurring on or after 

October 1, 2007 and on or before 

September 30, 2008) as required under 

section 1886(j)(3)(C) of the Social 

Security Act (the Act). Section 1886(j)(5) 

of the Act requires the Secretary to 

publish in the Federal Register on or 

before the August 1 that precedes the 

start of each fiscal year, the 

classification and weighting factors for 

the IRF prospective payment system’s 

(PPS) case-mix groups and a description 

of the methodology and data used in 

computing the prospective payment 

rates for that fiscal year. 

We are proposing to revise existing 

policies regarding the PPS within the 

authority granted under section 1886(j) 

of the Act. 

DATES: To be assured consideration, 

comments must be received at one of 

the addresses provided below, no later 

than 5 p.m. on July 2, 2007. 

ADDRESSES: In commenting, please refer 

to file code CMS–1551–P. Because of 

staff and resource limitations, we cannot 

accept comments by facsimile (Fax) 

transmission. 

You may submit comments in one of 

four ways (no duplicates, please): 

1. Electronically. You may submit 

electronic comments on specific issues 

in this regulation to http:// 

www.cms.hhs.gov/eRulemaking. Click 

on the link ‘‘Submit electronic 

comments on CMS regulations with an 

open comment period.’’ (Attachments 

should be in Microsoft Word, 

WordPerfect, or Excel; however, we 

prefer Microsoft Word.) 

2. By regular mail. You may mail 

written comments (one original and two 

copies) to the following address only: 

Centers for Medicare & Medicaid 

Services, Department of Health and 

Human Services, Attention: CMS–1551– 

P, P.O. Box 8012, Baltimore, MD 21244– 

8012. Please allow sufficient time for 

mailed comments to be received before 

the close of the comment period. 

3. By express or overnight mail. You 

may send written comments (one 

original and two copies) to the following 

address only: Centers for Medicare & 

Medicaid Services, Department of 

Health and Human Services, Attention: 

CMS–1551–P, Mail Stop C4–26–05, 

7500 Security Boulevard, Baltimore, MD 

21244–8012. 

4. By hand or courier. If you prefer, 

you may deliver (by hand or courier) 

your written comments (one original 

and two copies) before the close of the 

comment period to one of the following 

addresses. If you intend to deliver your 

comments to the Baltimore address, 

please call telephone number (410) 786– 

7195 in advance to schedule your 

arrival with one of our staff members. 

Room 445–G, Hubert H. Humphrey 

Building, 200 Independence Avenue, 

SW., Washington, DC 20201; or 7500 

Security Boulevard, Baltimore, MD 

21244–1850. (Because access to the 

interior of the HHH Building is not 

readily available to persons without 

Federal Government identification, 

commenters are encouraged to leave 

their comments in the CMS drop slots 

located in the main lobby of the 

building. A stamp-in clock is available 

for persons wishing to retain a proof of 

filing by stamping in and retaining an 

extra copy of the comments being filed.) 

Comments mailed to the addresses 

indicated as appropriate for hand or 

courier delivery may be delayed and 

received after the comment period. 

For information on viewing public 

comments, see the beginning of the 

SUPPLEMENTARY INFORMATION section. 

FOR FURTHER INFORMATION CONTACT: Pete 

Diaz, (410) 786–1235, for information 

regarding the 75 percent rule. Susanne 

Seagrave, (410) 786–0044, for 

information regarding the payment 

policies. Zinnia Ng, (410) 786–4587, for 

information regarding the wage index 

and prospective payment rate 

calculation. 

SUPPLEMENTARY INFORMATION: 

Submitting Comments: We welcome 

comments from the public on all issues 

set forth in this rule to assist us in fully 

considering issues and developing 

policies. You can assist us by 

referencing the file code CMS–1551–P 

and the specific ‘‘issue identifier’’ that 

precedes the section on which you 

choose to comment. 

Inspection of Public Comments: All 

comments received before the close of 

the comment period are available for 

viewing by the public, including any 

personally identifiable or confidential 

business information that is included in 

a comment. We post all comments 

received before the close of the 

comment period on the following Web 

site as soon as possible after they have 

been received: http://www.cms.hhs.gov/ 

eRulemaking. Click on the link 

‘‘Electronic Comments on CMS 

Regulations’’ on that Web site to view 

public comments. 

Comments received timely will also 

be available for public inspection as 

they are received, generally beginning 

approximately 3 weeks after publication 

of a document, at the headquarters of 

the Centers for Medicare & Medicaid 

Services, 7500 Security Boulevard, 

Baltimore, Maryland 21244, Monday 

through Friday of each week from 8:30 

a.m. to 4 p.m. To schedule an 

appointment to view public comments, 

phone 1–800–743–3951. 

Table of Contents 

I. Background 

A. Historical Overview of the Inpatient 

Rehabilitation Facility Prospective 

Payment System (IRF PPS) for Fiscal 

Years (FYs) 2002 through 2007 

B. Requirements for Updating the IRF PPS 

Rates 

C. Operational Overview of the Current IRF 

PPS 

D. Brief Summary of Proposed Revisions to 

the IRF PPS for FY 2008 

II. 75 Percent Rule Policy 

III. Classification System for the Inpatient 

Rehabilitation Facility Prospective 

Payment System 

IV. Proposed FY 2008 IRF PPS Federal 

Prospective Payment Rates 

A. Proposed FY 2008 IRF Market Basket 

Increase Factor and Labor-Related Share 

B. Proposed Area Wage Adjustment 

C. Description of the Proposed IRF 

Standard Payment Conversion Factor 

and Proposed Payment Rates for FY 2008 

D. Example of the Methodology for 

Adjusting the Proposed Federal 

Prospective Payment Rates 

V. Update to Payments for High-Cost Outliers 

Under the IRF PPS 

A. Proposed Update to the Outlier 

Threshold Amount for FY 2008 

B. Update to the IRF Cost-to-Charge Ratio 

Ceilings 

VI. Clarification to the Regulations Text for 

Special Payment Provisions for Patients 

That Are Transferred 

VII. Provisions of a Proposed Regulation 

VIII. Collection of Information Requirement 

IX. Response to Public Comments 

X. Regulatory Impact Analysis 

A. Overall Impact 

B. Anticipated Effects of the Proposed Rule 

C. Anticipated Effects of the 75 Percent 

Rule Policy 

D. Alternatives Considered 

E. Accounting Statement 

F. Conclusion 

Regulation Text 

Addendum 


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Acronyms 

Because of the many terms to which we 

refer by acronym in this proposed rule, we 

are listing the acronyms used and their 

corresponding terms in alphabetical order 

below. 

ASCA—Administrative Simplification 

Compliance Act of 2002, Pub. L. 107–105 

BBA—Balanced Budget Act of 1997, Pub. L. 

105–33 

BBRA—Medicare, Medicaid, and SCHIP 

[State Children’s Health Insurance 

Program] Balanced Budget Refinement Act 

of 1999, Pub. L. 106–113 

BIPA—Medicare, Medicaid, and SCHIP [State 

Children’s Health Insurance Program] 

Benefits Improvement and Protection Act 

of 2000, Pub. L. 106–554 

CBSA—Core-Based Statistical Area 

CCR—Cost-to-Charge Ratio 

CFR—Code of Federal Regulations 

CMG—Case-Mix Group 

DRA—Deficit Reduction Act of 2005, Pub. L. 

109–171 

DSH—Disproportionate Share Hospital 

ECI—Employment Cost Indexes 

FI—Fiscal Intermediary 

FR—Federal Register 

FY—Federal Fiscal Year 

GDP—Gross Domestic Product 

HHH—Hubert H. Humphrey Building 

HIPAA—Health Insurance Portability and 

Accountability Act, Pub. L. 104–191 

IFMC—Iowa Foundation for Medical Care 

IPPS—Inpatient Prospective Payment System 

IRF—Inpatient Rehabilitation Facility 

IRF–PAI—Inpatient Rehabilitation FacilityPatient Assessment Instrument 

IRF PPS—Inpatient Rehabilitation Facility 

Prospective Payment System 

IRVEN—Inpatient Rehabilitation Validation 

and Entry 

LIP—Low-Income Percentage 

MEDPAR—Medicare Provider Analysis and 

Review 

MMA—Medicare Prescription Drug, 

Improvement, and Modernization Act of 

2003 (Pub. L. 108–173) 

MSA—Metropolitan Statistical Area 

NAICS—North American Industrial 

Classification System 

OMB—Office of Management and Budget 

PAI—Patient Assessment Instrument 

PPS—Prospective Payment System 

RAND—RAND Corporation 

RFA—Regulatory Flexibility Act, Pub. L. 96–

354 

RIA—Regulation Impact Analysis 

RIC—Rehabilitation Impairment Category 

RPL—Rehabilitation, Psychiatric, and LongTerm Care Hospital Market Basket 

SCHIP—State Children’s Health Insurance 

Program 

SIC—Standard Industrial Code 

TEFRA—Tax Equity and Fiscal 

Responsibility Act of 1982, Pub. L. 97–248 

I. Background 

[If you choose to comment on issues 

in this section, please include the 

caption ‘‘Background’’ at the beginning 

of your comments.] 

A. Historical Overview of the Inpatient 

Rehabilitation Facility Prospective 

Payment System (IRF PPS) for Fiscal 

Years (FYs) 2002 through 2007 

Section 4421 of the Balanced Budget 

Act of 1997 (BBA, Pub. L. 105–33), as 

amended by section 125 of the 

Medicare, Medicaid, and SCHIP [State 

Children’s Health Insurance Program] 

Balanced Budget Refinement Act of 

1999 (BBRA, Pub. L. 106–113), and by 

section 305 of the Medicare, Medicaid, 

and SCHIP Benefits Improvement and 

Protection Act of 2000 (BIPA, Pub. L. 

106–554), provides for the 

implementation of a per discharge 

prospective payment system (PPS), 

through section 1886(j) of the Social 

Security Act (the Act), for inpatient 

rehabilitation hospitals and inpatient 

rehabilitation units of a hospital 

(hereinafter referred to as IRFs). 

Payments under the IRF PPS 

encompass inpatient operating and 

capital costs of furnishing covered 

rehabilitation services (that is, routine, 

ancillary, and capital costs) but not 

costs of approved educational activities, 

bad debts, and other services or items 

outside the scope of the IRF PPS. 

Although a complete discussion of the 

IRF PPS provisions appears in the 

August 7, 2001 final rule (66 FR 41316) 

as revised in the FY 2006 IRF PPS final 

rule (70 FR 47880), we are providing 

below a general description of the IRF 

PPS for fiscal years (FYs) 2002 through 

2005. 

Under the IRF PPS from FY 2002 

through FY 2005, as described in the 

August 7, 2001 final rule, the Federal 

prospective payment rates were 

computed across 100 distinct case-mix 

groups (CMGs). We constructed 95 

CMGs using rehabilitation impairment 

categories (RICs), functional status (both 

motor and cognitive), and age (in some 

cases, cognitive status and age may not 

be a factor in defining a CMG). In 

addition, we constructed five special 

CMGs to account for very short stays 

and for patients who expire in the IRF. 

For each of the CMGs, we developed 

relative weighting factors to account for 

a patient’s clinical characteristics and 

expected resource needs. Thus, the 

weighting factors accounted for the 

relative difference in resource use across 

all CMGs. Within each CMG, we created 

tiers based on the estimated effects that 

certain comorbidities would have on 

resource use. 

We established the Federal PPS rates 

using a standardized payment 

conversion factor (formerly referred to 

as the budget neutral conversion factor). 

For a detailed discussion of the budget 

neutral conversion factor, please refer to 

our August 1, 2003 final rule (68 FR 

45674, 45684 through 45685). In the FY 

2006 IRF PPS final rule (70 FR 47880), 

we discussed in detail the methodology 

for determining the standard payment 

conversion factor. 

We applied the relative weighting 

factors to the standard payment 

conversion factor to compute the 

unadjusted Federal prospective 

payment rates. Under the IRF PPS from 

FYs 2002 through 2005, we then applied 

adjustments for geographic variations in 

wages (wage index), the percentage of 

low-income patients, and location in a 

rural area (if applicable) to the IRF’s 

unadjusted Federal prospective 

payment rates. In addition, we made 

adjustments to account for short-stay 

transfer cases, interrupted stays, and 

high cost outliers. 

For cost reporting periods that began 

on or after January 1, 2002 and before 

October 1, 2002, we determined the 

final prospective payment amounts 

using the transition methodology 

prescribed in section 1886(j)(1) of the 

Act. Under this provision, IRFs 

transitioning into the PPS were paid a 

blend of the Federal IRF PPS rate and 

the payment that the IRF would have 

received had the IRF PPS not been 

implemented. This provision also 

allowed IRFs to elect to bypass this 

blended payment and immediately be 

paid 100 percent of the Federal IRF PPS 

rate. The transition methodology 

expired as of cost reporting periods 

beginning on or after October 1, 2002 

(FY 2003), and payments for all IRFs 

now consist of 100 percent of the 

Federal IRF PPS rate. 

We established a CMS Web site as a 

primary information resource for the 

IRF PPS. The Web site URL is http:// 

www.cms.hhs.gov/

InpatientRehabFacPPS/ and may be 

accessed to download or view 

publications, software, data 

specifications, educational materials, 

and other information pertinent to the 

IRF PPS. 

Section 1886(j) of the Act confers 

broad statutory authority to propose 

refinements to the IRF PPS. We 

finalized the refinements described in 

this section in the FY 2006 IRF PPS 

final rule (70 FR 47880). The provisions 

of the FY 2006 IRF PPS final rule 

became effective for discharges 

beginning on or after October 1, 2005. 

We published correcting amendments to 

the FY 2006 IRF PPS final rule in the 

Federal Register on September 30, 2005 

(70 FR 57166). Any reference to the FY 

2006 IRF PPS final rule in this proposed 

rule also includes the provisions 

effective in the correcting amendments. 


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In the FY 2006 final rule (70 FR 47880 

and 70 FR 57166), we finalized a 

number of refinements to the IRF PPS 

case-mix classification system (the 

CMGs and the corresponding relative 

weights) and the case-level and facilitylevel adjustments. These refinements 

were based on analyses by the RAND 

Corporation (RAND), a non-partisan 

economic and social policy research 

group, using calendar year 2002 and FY 

2003 data. These were the first 

significant refinements to the IRF PPS 

since its implementation. In conducting 

the analysis, RAND used claims and 

clinical data for services furnished after 

the IRF PPS implementation. These 

newer data sets were more complete, 

and reflected improved coding of 

comorbidities and patient severity by 

IRFs. The researchers were able to use 

new data sources for imputing missing 

values and more advanced statistical 

approaches to complete their analyses. 

The RAND reports supporting the 

refinements made to the IRF PPS are 

available on the CMS Web site at: 

http://www.cms.hhs.gov/

InpatientRehabFacPPS/

09_Research.asp. 

The final key policy changes, effective 

for discharges occurring on or after 

October 1, 2005, are discussed in detail 

in the FY 2006 IRF PPS final rule (70 

FR 47880 and 70 FR 57166). The 

following is a brief summary of the key 

policy changes: 

• Adopted the Office of Management 

and Budget’s (OMB’s) Core-Based 

Statistical Area (CBSA) market area 

definitions in a budget neutral manner. 

• Implemented a budget-neutral 

three-year hold harmless policy for IRFs 

that had been classified as rural in FY 

2005, but became urban in FY 2006. 

• Implemented a payment adjustment 

to account for changes in coding that 

did not reflect real changes in case mix. 

We reduced the standard payment 

amount by 1.9 percent to account for 

such changes in coding following 

implementation of the IRF PPS. 

• Modified the CMGs, tier 

comorbidities, and relative weights in a 

budget-neutral manner. The five special 

CMGs remained the same as they had 

been before FY 2006 and continued to 

account for very short stays and for 

patients who expire in the IRF. 

• Implemented a teaching status 

adjustment in a budget neutral manner 

for IRFs, similar to the one adopted for 

inpatient psychiatric facilities. 

• Revised and rebased the market 

basket and labor-related share to reflect 

the operating and capital cost structures 

for rehabilitation, psychiatric, and longterm care (RPL) hospitals to update IRF 

payment rates. 

• Updated the rural adjustment from 

19.14 percent to 21.3 percent in a 

budget neutral manner. 

• Updated the low-income percentage 

(LIP) adjustment from an exponent of 

0.484 to an exponent of 0.6229 in a 

budget neutral manner. 

• Updated the outlier threshold 

amount from $11,211 to $5,129. 

As noted above, a detailed discussion 

of the final key policy changes for FY 

2006 appears in the FY 2006 IRF PPS 

final rule (70 FR 47880 and 70 FR 

57166). 

In the FY 2007 final rule (71 FR 

48354) we made the following revisions 

and updates: 

• Updated the relative weight and 

average length of stay tables based on reanalysis of the data by CMS and our 

contractor, the RAND Corporation. 

• Reduced the standard payment 

amount by 2.6 percent to account more 

fully for coding changes that do not 

reflect real changes in case mix. 

• Updated the IRF PPS payment rates 

by the FY 2007 estimates of the market 

basket and the labor-related share. 

• Updated the IRF PPS payment rates 

by the FY 2007 wage indexes. 

• Applied the second year of the hold 

harmless policy in a budget neutral 

manner. 

• Updated the outlier threshold from 

$5,129 to $5,534. 

• Updated the urban and rural 

national cost-to-charge ratio ceilings for 

the purposes of determining outlier 

payments under the IRF PPS and 

clarified the methodology described in 

the regulations text. 

• Revised the regulation text in 

§ 412.23(b)(2)(i) and § 412.23(b)(2)(ii) to 

reflect the statutory changes in section 

5005 of the Deficit Reduction Act of 

2005 (DRA, Pub. L. 109–171). The 

regulation text change prolongs the 

overall duration of the phased transition 

to the full 75 percent threshold 

established in § 412.23(b)(2)(i) and 

§ 412.23(b)(2)(ii), by extending the 

transition’s 60 percent phase for an 

additional 12 months. In addition to the 

above DRA requirements pertaining to 

the applicable compliance percentage 

requirements under § 412.23(b)(2), we 

also permitted a comorbidity that meets 

the criteria as specified in (b)(2)(i) to 

continue to be used before the 75 

percent compliance threshold must be 

met. 

B. Requirements for Updating the IRF 

PPS Rates 

On August 7, 2001, we published a 

final rule titled ‘‘Medicare Program; 

Prospective Payment System for 

Inpatient Rehabilitation Facilities’’ in 

the Federal Register (66 FR 41316) that 

established a PPS for IRFs as authorized 

under section 1886(j) of the Act and 

codified at subpart P of part 412 of the 

Medicare regulations. In the August 7, 

2001 final rule, we set forth the per 

discharge Federal prospective payment 

rates for FY 2002, which provided 

payment for inpatient operating and 

capital costs of furnishing covered 

rehabilitation services (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 IRF 

PPS. The provisions of the August 7, 

2001 final rule were effective for cost 

reporting periods beginning on or after 

January 1, 2002. On July 1, 2002, we 

published a correcting amendment to 

the August 7, 2001 final rule in the 

Federal Register (67 FR 44073). Any 

references to the August 7, 2001 final 

rule in this proposed rule include the 

provisions effective in the correcting 

amendment. 

Section 1886(j)(5) of the Act and 

§ 412.628 of the regulations require the 

Secretary to publish in the Federal 

Register, on or before the August 1 that 

precedes the start of each new FY, the 

classifications and weighting factors for 

the IRF CMGs and a description of the 

methodology and data used in 

computing the prospective payment 

rates for the upcoming FY. On August 

1, 2002, we published a notice in the 

Federal Register (67 FR at 49928) to 

update the IRF Federal prospective 

payment rates from FY 2002 to FY 2003 

using the methodology as described in 

§ 412.624. As stated in the August 1, 

2002 notice, we used the same 

classifications and weighting factors for 

the IRF CMGs that were set forth in the 

August 7, 2001 final rule to update the 

IRF Federal prospective payment rates 

from FY 2002 to FY 2003. We continued 

to update the prospective payment rates 

in accordance with the methodology set 

forth in the August 7, 2001 final rule for 

each succeeding FY up to and including 

FY 2005. For FY 2006, however, we 

published a final rule that revised 

several IRF PPS policies (70 FR 47880). 

The provisions of the FY 2006 IRF PPS 

final rule became effective for 

discharges occurring on or after October 

1, 2005. We published correcting 

amendments to the FY 2006 IRF PPS 

final rule in the Federal Register (70 FR 

57166). Any reference to the FY 2006 

IRF PPS final rule in this proposed rule 

includes the provisions effective in the 

correcting amendments. 

In the final rule for FY 2007, we 

updated the IRF Federal prospective 

payment rates. In addition, we updated 

the cost-to-charge ratio ceilings and the 

outlier threshold. We implemented a 2.6 


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percent reduction to the FY 2007 

standard payment amount to account 

more fully for changes in coding 

practices that do not reflect real changes 

in case mix. We revised the tier 

comorbidities and the relative weights 

to ensure that IRF PPS payments reflect, 

as closely as possible, the costs of caring 

for patients in IRFs. The final FY 2007 

Federal prospective payment rates were 

effective for discharges occurring on or 

after October 1, 2006 and on or before 

September 30, 2007. 

C. Operational Overview of the Current 

IRF PPS 

As described in the August 7, 2001 

final rule, upon the admission and 

discharge of a Medicare Part A fee-forservice patient, the IRF is required to 

complete the appropriate sections of a 

patient assessment instrument, the 

Inpatient Rehabilitation Facility-Patient 

Assessment Instrument (IRF-PAI). All 

required data must be electronically 

encoded into the IRF-PAI software 

product. Generally, the software product 

includes patient grouping programming 

called the GROUPER software. The 

GROUPER software uses specific Patient 

Assessment Instrument (PAI) data 

elements to classify (or group) patients 

into distinct CMGs and account for the 

existence of any relevant comorbidities. 

The GROUPER software produces a 

five-digit CMG number. The first digit is 

an alpha-character that indicates the 

comorbidity tier. The last four digits 

represent the distinct CMG number. 

(Free downloads of the Inpatient 

Rehabilitation Validation and Entry 

(IRVEN) software product, including the 

GROUPER software, are available on the 

CMS Web site at http:// 

www.cms.hhs.gov/

InpatientRehabFacPPS/

06_Software.asp). 

Once a patient is discharged, the IRF 

completes the Medicare claim (UB–92 

or its equivalent) using the five-digit 

CMG number and sends it to the 

appropriate Medicare fiscal 

intermediary (FI). Claims submitted to 

Medicare must comply with both the 

Administrative Simplification 

Compliance Act (ASCA, Pub. L. 107–

105), and the Health Insurance 

Portability and Accountability Act of 

1996 (HIPAA, Pub. L. 104–191). Section 

3 of the ASCA amends section 1862(a) 

of the Act by adding paragraph (22) 

which requires the Medicare program, 

subject to section 1862(h) of the Act, to 

deny payment under Part A or Part B for 

any expenses for items or services ‘‘for 

which a claim is submitted other than 

in an electronic form specified by the 

Secretary.’’ Section 1862(h) of the Act, 

in turn, provides that the Secretary shall 

waive such denial in two types of cases 

and may also waive such denial ‘‘in 

such unusual cases as the Secretary 

finds appropriate.’’ See also the final 

rule on Electronic Submission of 

Medicare Claims (70 FR 71008, 

November 25, 2005). Section 3 of the 

ASCA operates in the context of the 

administrative simplification provisions 

of HIPAA, which include, among others, 

the requirements for transaction 

standards and code sets codified as 45 

CFR parts 160 and 162, subparts A and 

I through R (generally known as the 

Transactions Rule). The Transactions 

Rule requires covered entities, including 

covered providers, to conduct covered 

electronic transactions according to the 

applicable transaction standards. (See 

the program claim memoranda issued 

and published by CMS at: http:// 

www.cms.hhs.gov/

ElectronicBillingEDITrans/ and listed in 

the addenda to the Medicare 

Intermediary Manual, Part 3, section 

3600. Instructions for the limited 

number of claims submitted to Medicare 

on paper are published by CMS at: 

http://www.cms.hhs.gov/manuals/

downloads/clm104c25.pdf. 

The Medicare FI processes the claim 

through its software system. This 

software system includes pricing 

programming called the PRICER 

software. The PRICER software uses the 

CMG number, along with other specific 

claim data elements and providerspecific data, to adjust the IRF’s 

prospective payment for interrupted 

stays, transfers, short stays, and deaths, 

and then applies the applicable 

adjustments to account for the IRF’s 

wage index, percentage of low-income 

patients, rural location, and outlier 

payments. For discharges occurring on 

or after October 1, 2005, the IRF PPS 

payment also reflects the new teaching 

status adjustment that became effective 

as of FY 2006, as discussed in the FY 

2006 IRF PPS final rule (70 FR 47880). 

D. Brief Summary of Proposed Revisions 

to the IRF PPS for FY 2008 

In this proposed rule, we are 

proposing to make the following 

revisions, updates, and clarifications: 

• Update the FY 2008 IRF PPS 

payment rates by the proposed market 

basket, as discussed in section IV.A. 

• Update the FY 2008 IRF PPS 

payment rates by the proposed wage 

index and the labor related share in a 

budget neutral manner, as discussed in 

section IV.A and B. 

• Update the pre-reclassified and prefloor wage indexes based on the 

applicable Office of Management and 

Budget (OMB) bulletins that add or 

delete Core-Based Statistical Areas 

(CBSAs) numbers and title changes, as 

discussed in section IV.B. 

• Implement the final year of the 3- 

year hold harmless policy adopted in 

the FY 2006 IRF PPS final rule (70 FR 

47880, 47923 through 47926) in a 

budget neutral manner, as discussed in 

section IV.B. 

• Update the outlier threshold 

amount for FY 2008 to $7,522, as 

discussed in section V.A. 

• Update the cost-to-charge ratio 

ceiling and the national average urban 

and rural cost-to-charge ratios for 

purposes of determining outlier 

payments under the IRF PPS, as 

discussed in section V.B. 

• Clarify the regulations text for the 

special payment provisions for patients 

that are transferred, as discussed in 

section VI. 

II. 75 Percent Rule Policy 

[If you choose to comment on issues 

in this section, please include the 

caption ‘‘75 Percent Rule Policy’’ at the 

beginning of your comments.] 

In order to be excluded from the acute 

care inpatient hospital PPS specified in 

§ 412.1(a)(1) and instead be paid under 

the IRF PPS, a hospital or rehabilitation 

unit of an acute care hospital must meet 

the requirements for classification as an 

IRF stipulated in subpart B of part 412. 

As discussed in previous Federal 

Register publications (68 FR 26786 

(May 16, 2003), 68 FR 53266 (September 

9, 2003), 69 FR 25752 (May 7, 2004), 70 

FR 36640 (June 24, 2005), and 71 FR 

48354 (August 18, 2006)), § 412.23(b)(2) 

specifies one criterion which Medicare 

uses for classifying a hospital or unit of 

a hospital as an IRF. The criterion is that 

a minimum percentage of a facility’s 

total inpatient population must require 

intensive rehabilitative services for the 

treatment of at least one of 13 medical 

conditions listed in § 412.23(b)(2)(iii) in 

order for the facility to be classified as 

an IRF. In addition, for cost reporting 

periods beginning on or after July 1, 

2004, and before July 1, 2008, a patient 

with a comorbidity as defined at 

§ 412.602 may be included in the 

inpatient population that counts toward 

the required applicable percentage if 

certain requirements are met. The 

minimum percentage is known as the 

‘‘compliance threshold.’’

Prior to the May 7, 2004 final rule (69 

FR 25752), § 412.23(b)(2) stipulated that 

the compliance threshold was 75 

percent. Therefore, the compliance 

threshold was commonly referred to as 

the ‘‘75 percent rule.’’ In addition, prior 

to the May 7, 2004 final rule the 

regulation only specified 10 medical 

conditions. However, in the May 7, 2004 

final rule we revised § 412.23(b)(2), and 


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that revision increased the number of 

medical conditions to 13, as well as 

temporarily lowered the compliance 

threshold while at the same time 

specified a transition period at the end 

of which IRFs would once again have to 

meet a compliance threshold of 75 

percent. Also, the revised regulation 

specified that during the compliance 

threshold transition period a patient’s 

comorbidity may be used to determine 

if a provider met the compliance 

threshold provided certain applicable 

requirements were met. 

In § 412.602 a comorbidity is defined 

as a specific patient condition that is 

secondary to the patient’s principal 

diagnosis. A patient’s principal 

diagnosis is the primary reason for the 

patient being admitted to an IRF, and 

this diagnosis is used to determine if the 

patient had a medical condition that can 

be counted towards meeting the 

compliance threshold. As specified in 

the May 7, 2004 final rule, in order for 

an inpatient with a certain comorbidity 

to be included in the inpatient 

population that counts toward the 

applicable percentage the following 

criteria must be met: 

• The patient is admitted for 

inpatient rehabilitation for a condition 

that is not one of the conditions listed 

in § 412.23(b)(2)(iii). 

• The patient also has a comorbidity 

that falls in one of the conditions listed 

in § 412.23(b)(2)(iii). 

• The comorbidity has caused 

significant decline in functional ability 

in the individual such that, even in the 

absence of the admitting condition, the 

individual would require the intensive 

rehabilitation treatment that is unique to 

inpatient rehabilitation facilities paid 

under the IRF PPS and that cannot be 

appropriately performed in another care 

setting covered under this Title. 

In accordance with the May 7, 2004 

final rule, IRFs would have to meet a 

compliance threshold of 75 percent for 

cost reporting periods starting on or 

after July 1, 2007. However, Section 

5005 of the Deficit Reduction Act of 

2005 (DRA) (Pub. L. 109–171 modified 

the applicable time periods when the 

various compliance thresholds, as 

originally specified in the May 7, 2004 

final rule, must be met.) The net effect 

of the DRA was extension of the 

compliance threshold transition period. 

Due to the DRA, the transition period 

was extended to include cost reporting 

periods starting on or after July 1, 2004, 

and before July 1, 2008. Therefore, in 

order to conform the regulations to the 

DRA, we revised § 412.23(b)(2) and 

stipulated that an IRF with a cost 

reporting period starting on or after July 

1, 2008, instead of July 1, 2007, must 

meet the 75 percent compliance 

threshold. In addition, we also 

permitted a comorbidity that meets the 

criteria as specified in (b)(2)(i) to 

continue to be used to determine the 

compliance threshold for cost reporting 

periods beginning before July 1, 2008 

instead of July 1, 2007. (For a complete 

description of all the changes made, see 

the FY 2007 IRF PPS final rule (71 FR 

48354)). 

For cost reporting periods beginning 

on or after July 1, 2008, comorbidities 

will not be eligible for inclusion in the 

calculations used to determine if the 

provider meets the 75 percent 

compliance threshold specified in 

§ 412.23(b)(2)(ii). As the 75 percent rule 

is only partially phased in at this time 

and there are limitations to the policy 

conclusions that can be drawn from 

currently available claim and patient 

assessment data, this rule maintains 

existing policy. However, in the May 7, 

2004 final rule (69 FR 25762), we 

encouraged research evaluating the 

continued use of comorbidities in 

determining compliance with the 75 

percent rule. Therefore, we are soliciting 

comments supporting current policy or 

other options, including use of some or 

all of the existing comorbidities in 

calculating the compliance percentage 

for an additional fixed period of one or 

more years or to integrate the inclusion 

of some or all of the existing 

comorbidities on a permanent basis. In 

addition, we are soliciting comments 

that include clinical data based on 

scientifically sound research that 

provide evidence on these and other 

options. 

III. Classification System for the 

Inpatient Rehabilitation Facility 

Prospective Payment System 

[If you choose to comment on issues 

in this section, please include the 

caption ‘‘Classification System for the 

Inpatient Rehabilitation Facility 

Prospective Payment System’’ at the 

beginning of your comments.] 

For the FY 2008 IRF PPS, we will use 

the same case-mix classification system 

that we used for FY 2007, as set forth 

in the FY 2007 IRF PPS final rule (71 

FR 48354). Table 1 below, ‘‘Relative 

Weights and Average Lengths of Stay for 

Case-Mix Groups’’, presents the CMGs, 

the comorbidity tiers, the corresponding 

relative weights, and the average length 

of stay value for each CMG and tier. The 

average length of stay for each CMG is 

used to determine when an IRF 

discharge meets the definition of a 

short-stay transfer, which results in a 

per diem case level adjustment. Because 

these data elements are not changing, 

Table 1 shown below is identical to 

Table 4 that was published in the FY 

2007 IRF PPS final rule (71 FR 48354, 

48364 through 48370). The methodology 

we used to construct the data elements 

in Table 1 is described in detail in the 

FY 2007 IRF PPS final rule (71 FR 

48354). 

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BILLING CODE 4120–07–C 

IV. Proposed FY 2008 IRF PPS Federal 

Prospective Payment Rates 

[If you choose to comment on issues 

in this section, please include the 

caption ‘‘Proposed FY 2008 IRF PPS 

Federal Prospective Payment Rates’’ at 

the beginning of your comments.] 

A. Proposed FY 2008 IRF PPS Market 

Basket Increase Factor and LaborRelated Share 

Section 1886(j)(3)(C) of the Act 

requires the Secretary to establish an 

increase factor that reflects changes over 


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time in the prices of an appropriate mix 

of goods and services included in the 

covered IRF services, which is referred 

to as a market basket index. In updating 

the FY 2008 payment rates outlined in 

this proposed rule, CMS applied an 

appropriate increase factor to the FY 

2007 IRF PPS payment rates that is 

based on the rehabilitation, psychiatric, 

and long-term care hospital (RPL) 

market basket. In constructing the RPL 

market basket, we used the methodology 

set forth in the FY 2006 IRF PPS final 

rule (70 FR 47880, 47908 through 

47915). 

As discussed in that final rule, the 

RPL market basket primarily uses the 

Bureau of Labor Statistics’ (BLS) data as 

price proxies, which are grouped in one 

of the three BLS categories: Producer 

Price Indexes (PPI), Consumer Price 

Indexes (CPI), and Employment Cost 

Indexes (ECI). We evaluated and 

selected these particular price proxies 

using the criteria of reliability, 

timeliness, availability, and relevance, 

and believe they continue to be the best 

measures of price changes for the cost 

categories. 

As discussed in the FY 2007 IRF PPS 

proposed rule, beginning April 2006 

with the publication of March 2006 

data, the BLS’’ ECI has used a different 

classification system, the North 

American Industrial Classification 

System (NAICS), instead of the Standard 

Industrial Codes (SIC). We have 

consistently used the ECI as the data 

source for our wages and salaries and 

other price proxies in the RPL market 

basket and did not make any changes. 

This proposed rule’s estimated FY 2008 

IRF market basket increase factor and 

labor-related share will be updated for 

the final rule based on the most recent 

data available from the BLS. 

We will use the same methodology 

described in the FY 2006 IRF PPS final 

rule to compute the FY 2008 IRF market 

basket increase factor and labor-related 

share. For this proposed rule, the FY 

2008 IRF market basket increase factor 

is 3.3 percent. This is based on Global 

Insight, Inc.’s forecast for the first 

quarter of 2007 (2007q1) with historical 

data through the fourth quarter of 2006 

(2006q4). We propose to update the 

market basket with more recent data for 

the final rule to the extent it is available. 

However, we note that the President’s 

budget includes a proposal for a zero 

percent update in the IRF market basket 

for FY 2008, and that the provisions 

outlined in this proposed rule would 

need to reflect any legislation that the 

Congress enacts to adopt this proposal. 

In addition, we have used the 

methodology described in the FY 2006 

IRF PPS final rule to update the laborrelated share for FY 2008. In FY 2004, 

we updated the 1992 market basket data 

to 1997 based on the methodology 

described in the August 1, 2003 final 

rule (68 FR 45688 through 45689). As 

discussed in the FY 2006 IRF PPS final 

rule (70 FR 47880, 47915 through 

47917), we rebased and revised the 

market basket for FY 2006 using the 

2002-based cost structures for IRFs, 

IPFs, and LTCHs to determine the FY 

2006 labor-related share. For FY 2007, 

we used the same methodology 

discussed in the FY 2006 IRF PPS final 

rule (70 FR 47880, 47908 through 

47917) to determine the FY 2007 IRF 

labor-related share. For FY 2008, we 

continue to use the same methodology 

discussed in the FY 2006 IRF PPS final 

rule. As shown in Table 2, the total FY 

2008 RPL labor-related share is 75.846 

percent in this proposed rule. We 

propose to update the labor-related 

share with more recent data for the final 

rule to the extent it is available. 

TABLE 2.—PROPOSED FY 2008 IRF 

LABOR-RELATED SHARE RELATIVE

IMPORTANCE

Cost category 

Proposed FY 

2008 IRF 

labor-related 

relative 

importance 

Wages and salaries .............. 52.640 

Employee benefits ................ 14.149 

Professional fees .................. 2.907 

All other labor intensive services .................................... 2.147 

Subtotal ......................... 71.843 

Labor-related share of capital 

costs .................................. 4.003 

Total ............................... 75.846 

SOURCE: Global Insight, Inc, 1st Qtr, 2007; 

@USMACRO/CONTROL0307 @CISSIM/ 

TL0207.SIM Historical Data through 4th QTR, 

2006 

B. Proposed Area Wage Adjustment 

Section 1886(j)(6) of the Act requires 

the Secretary to adjust the proportion 

(as estimated by the Secretary from time 

to time) of rehabilitation facilities’ costs 

attributable to wages and wage-related 

costs by a factor (established by the 

Secretary) reflecting the relative hospital 

wage level in the geographic area of the 

rehabilitation facility compared to the 

national average wage level for those 

facilities. The Secretary is required to 

update the wage index on the basis of 

information available to the Secretary 

on the wages and wage-related costs to 

furnish rehabilitation services. Any 

adjustments or updates made under 

section 1886(j)(6) of the Act for a FY are 

made in a budget neutral manner. 

In the FY 2007 IRF PPS final rule, we 

maintained the methodology described 

in the FY 2006 IRF PPS final rule to 

determine the wage index, labor market 

area definitions, and hold harmless 

policy consistent with the rationale 

outlined in that final rule (70 FR 47880, 

47917 through 47933). In the FY 2006 

IRF PPS final rule, we adopted a 3-year 

hold harmless policy specifically for 

rural IRFs whose labor market 

designations changed from rural to 

urban under the CBSA-based labor 

market area designations. This policy 

specifically applied to IRFs that had 

been previously designated rural and 

which, effective for discharges on or 

after October 1, 2005, would otherwise 

have become ineligible for the 19.14 

percent rural adjustment. For FY 2008, 

the third and final year of the 3-year 

phase-out of the budget-neutral hold 

harmless policy, we will no longer 

apply an adjustment for IRFs that meet 

the criteria described in the FY 2006 

final rule (70 FR 47880, 47923 through 

47926). 

For FY 2008, we propose to maintain 

the policies and methodologies 

described in the FY 2007 IRF PPS final 

rule relating to the labor market area 

definitions, the wage index 

methodology for areas with wage data, 

and hold harmless policy consistent 

with the rationale outlined in the FY 

2006 IRF PPS final rule (70 FR 47880, 

47917 through 47933). Therefore, this 

proposed rule continues to use the CoreBased Statistical Area (CBSA) labor 

market area definitions and the prereclassification and pre-floor hospital 

wage index based on 2003 cost report 

data. In addition, the budget neutral 

hold harmless policy established in the 

FY 2006 final rule will expire for 

discharges occurring on or after October 

1, 2007. 

In adopting the CBSA geographic 

designations in FY 2006, we provided a 

one-year transition with a blended wage 

index for all providers. For FY 2006, the 

wage index for each provider consisted 

of a blend of 50 percent of the FY 2006 

MSA-based wage index and 50 percent 

of the FY 2006 CBSA-based wage index 

(both using FY 2001 hospital data). We 

referred to the blended wage index as 

the FY 2006 IRF PPS transition wage 

index. As discussed in the FY 2006 IRF 

PPS final rule (70 FR 47880, 47926), 

subsequent to the expiration of this oneyear transition on September 30, 2006, 

we used the full CBSA-based wage 

index values as published in the 

Addendum of the FY 2007 IRF PPS final 

rule (71 FR 48354) and in the 

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When adopting OMB’s new labor 

market designations, we identified some 

geographic areas where there were no 

hospitals and, thus, no hospital wage 

index data on which to base the 

calculation of the IRF PPS wage index 

(70 FR 47880). 

In this proposed rule, we are 

proposing to revise our methodology to 

determine a proxy for rural areas 

without hospital wage data. Under the 

CBSA labor market areas, there are no 

rural hospitals in rural Massachusetts 

and rural Puerto Rico. Because there 

was no rural proxy for more recent rural 

data within those areas, we used the FY 

2006 wage index value in both FY 2006 

and FY 2007 for rural Massachusetts 

and rural Puerto Rico. 

Due to the use of the same wage index 

value (from FY 2006) for these areas for 

two fiscal years, we believe it is 

appropriate at this point to consider 

alternatives in our methodology to 

update the wage index for rural areas 

without rural hospital wage index data. 

We believe that the best imputed proxy 

would 1) use pre-floor, pre-reclassified 

hospital data, 2) be easy to evaluate, 3) 

use the most local data, and 4) be easily 

updateable from year-to-year. Since the 

implementation of the IRF PPS, we have 

used the pre-floor, pre-reclassified 

hospital wage data that is easy to 

evaluate and is updateable from year-toyear. In addition, the IRF PPS wage 

index is based on hospitals’ cost report 

data, which reflects local available data. 

Therefore, we believe the imputed 

proxy for a rural area without hospital 

wage data is consistent with our past 

methodology and other post-acute PPS 

wage index policy. Although our 

current methodology uses rural prefloor, pre-reclassified hospital wage 

data, this method is not updateable from 

year-to-year. 

Therefore, in cases where there is a 

rural area without rural hospital wage 

data, we propose using the average wage 

index from all contiguous CBSAs to 

represent a reasonable proxy for the 

rural area within a State. While this 

approach does not use rural data, it does 

use pre-floor, pre-reclassified hospital 

wage data, it is easy to evaluate, it is 

updateable from year-to-year, and it 

uses the most local data available. 

In determining an imputed rural wage 

index, we interpret the term 

‘‘contiguous’’ to mean sharing a border. 

For example, in the case of 

Massachusetts, the entire rural area 

consists of Dukes and Nantucket 

counties. We have determined that the 

borders of Dukes and Nantucket 

counties are local and contiguous with 

Barnstable and Bristol counties. Under 

the proposed methodology, the wage 

indexes for the counties of Barnstable 

(CBSA 12700: 1.2539) and Bristol 

(CBSA 39300: 1.0783) are averaged, 

resulting in an imputed rural wage 

index of 1.1661 for rural Massachusetts 

for FY 2008. While we believe that this 

policy could be readily applied to other 

rural areas that lack hospital wage data 

(possibly due to hospitals converting to 

a different provider type, such as a 

CAH, that does not submit the 

appropriate wage data), we may reexamine this policy should a similar 

situation arise in the future. 

However, we do not believe that this 

policy is appropriate for Puerto Rico. 

There are sufficient economic 

differences between hospitals in the 

United States and those in Puerto Rico 

(including the payment of hospitals in 

Puerto Rico using blended Federal/ 

Commonwealth-specific rates) that a 

separate and distinct policy for Puerto 

Rico is necessary. Consequently, any 

alternative methodology for imputing a 

wage index for rural Puerto Rico would 

need to take into account these 

economic differences and the payment 

rates hospitals receive in Puerto Rico. 

Our policy of imputing a rural wage 

index based on the wage index(es) of 

CBSAs contiguous to the rural area in 

question does not recognize the unique 

circumstances of Puerto Rico. While we 

have not yet identified an alternative 

methodology for imputing a wage index 

for rural Puerto Rico, we will continue 

to evaluate the feasibility of using 

existing hospital wage data and, 

possibly, wage data from other sources. 

By maintaining our current policy for 

Puerto Rico, we will maintain 

consistency with other post-acute care 

PPS wage index policies. Accordingly, 

we propose to continue using the most 

recent wage index previously available 

for Puerto Rico; that is, a wage index of 

0.4047. We solicit comments on our 

proposal to maintain the current wage 

index policy for rural Puerto Rico. 

In the FY 2006 IRF PPS final rule (70 

FR 47880, 47920), we notified the 

public that the Office of Management 

and Budget (OMB) published a bulletin 

that changed the titles to certain CBSAs 

after the publication of our FY 2006 IRF 

PPS proposed rule (70 FR 30186). Since 

the publication of the FY 2006 IRF PPS 

final rule, OMB published additional 

bulletins that updated the CBSAs. 

Specifically, OMB added or deleted 

certain CBSA numbers and revised 

certain titles. Accordingly, in this 

proposed rule, we are proposing to 

clarify that this and all subsequent IRF 

PPS rules and notices are considered to 

incorporate the CBSA changes 

published in the most recent OMB 

bulletin that applies to the hospital 

wage data used to determine the current 

IRF PPS wage index. The OMB bulletins 

may be accessed online at http:// 

www.whitehouse.gov/omb/bulletins/ 

index.html. 

To calculate the wage-adjusted facility 

payment for the payment rates set forth 

in this proposed rule, we multiply the 

unadjusted Federal prospective 

payment by the proposed FY 2008 RPL 

labor-related share (75.846 percent) to 

determine the labor-related portion of 

the Federal prospective payments. We 

then multiply this labor-related portion 

by the applicable proposed IRF wage 

index shown in Table 1 for urban areas 

and Table 2 for rural areas in the 

Addendum. 

Adjustments or updates to the IRF 

wage index made under section 

1886(j)(6) of the Act must be made in a 

budget neutral manner; therefore, we 

calculated a budget neutral wage 

adjustment factor as established in the 

August 1, 2003 final rule and codified 

at § 412.624(e)(1), and described in the 

steps below. We propose to use the 

following steps to ensure that the FY 

2008 IRF standard payment conversion 

factor reflects the update to the 

proposed wage indexes (based on the 

FY 2003 pre-reclassified and pre-floor 

hospital wage data) and the proposed 

labor-related share in a budget neutral 

manner: 

Step 1 Determine the total amount of 

the estimated FY 2007 IRF PPS rates, 

using the FY 2007 standard payment 

conversion factor and the labor-related 

share and the wage indexes from FY 

2007 (as published in the FY 2007 IRF 

PPS final rule). 

Step 2 Calculate the total amount of 

estimated IRF PPS payments, using the 

FY 2007 standard payment conversion 

factor and the proposed FY 2008 laborrelated share and proposed CBSA urban 

and rural wage indexes. 

Step 3 Divide the amount calculated 

in step 1 by the amount calculated in 

step 2, which equals the FY 2008 budget 

neutral wage adjustment factor of 

1.0026. 

Step 4 Apply the FY 2008 budget 

neutral wage adjustment factor from 

step 3 to the FY 2007 IRF PPS standard 

payment conversion factor after the 

application of the estimated market 

basket update to determine the FY 2008 

standard payment conversion factor. 

C. Description of the Proposed IRF 

Standard Payment Conversion Factor 

and Proposed Payment Rates for FY 

2008 

To calculate the proposed standard 

payment conversion factor for FY 2008 

and as illustrated in Table 3 below, we 

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basket increase factor (3.3 percent) to 

the standard payment conversion factor 

for FY 2007 ($12,981), which equals 

$13,409. We then apply the proposed 

combined budget neutrality factor for 

the wage index and labor related share 

and final year of the hold harmless 

policy of 1.0040 (1.0026 * 1.0014 = 

1.0040), which would result in a 

proposed standard payment conversion 

factor of $13,463. 

TABLE 3.—CALCULATIONS TO DETERMINE THE PROPOSED FY 2008 

STANDARD PAYMENT CONVERSION

FACTOR

Explanation for adjustment Calculations 

FY 2007 Standard Payment 

Conversion Factor ............. 12,981 

Proposed FY 2008 Market 

Basket Increase Factor ..... × 1.033 

Subtotal ......................... = 13,409 

Proposed Budget Neutrality 

Factor for the Wage Index, 

Labor-Related Share, and 

the Hold Harmless Provision .................................... × 1.0040 

TABLE 3.—CALCULATIONS TO DETERMINE THE PROPOSED FY 2008 

STANDARD PAYMENT CONVERSION

FACTOR—Continued 

Explanation for adjustment Calculations 

Proposed FY 2008 Standard 

Payment Conversion Factor ...................................... = $13,463 

After the application of the relative 

weights, the resulting proposed 

unadjusted IRF prospective payment 

rates for FY 2008 are shown below in 

Table 4, ‘‘Proposed FY 2008 Payment 

Rates.’’

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BILLING CODE 4120–07–C 

D. Example of the Methodology for 

Adjusting the Proposed Federal 

Prospective Payment Rates 

Table 5 illustrates the proposed 

methodology for adjusting the Federal 

prospective payments (as described in 

sections IV.A through C of this proposed 

rule). The examples below are based on 

two hypothetical Medicare 

beneficiaries, both classified into CMG 

0110 (without comorbidities). The 

unadjusted Federal prospective 

payment rate for CMG 0110 (without 

comorbidities) can be found in Table 4 

above. 

One beneficiary is in Facility A, an 

IRF located in rural Spencer County, 

Indiana, and another beneficiary is in 

Facility B, an IRF located in urban 

Harrison County, Indiana. Facility A, a 

non-teaching hospital, has a 

disproportionate share hospital (DSH) 

percentage of 5 percent (which results 

in a LIP adjustment of 1.0309), a wage 

index of 0.8538, and an applicable rural 

adjustment of 21.3 percent. Facility B, a 

teaching hospital, has a DSH percentage 

of 15 percent (which results in a LIP 

adjustment of 1.0910), a wage index of 

0.9118, and an applicable teaching 

status adjustment of 0.109. 

To calculate each IRF’s labor and nonlabor portion of the Federal prospective 

payment, we begin by taking the 

unadjusted Federal prospective 

payment rate for CMG 0110 (without 

comorbidities) from Table 4 above. 

Then, we multiply the estimated laborrelated share (75.846) described in 

section IV.A by the unadjusted Federal 

prospective payment rate. To determine 

the non-labor portion of the Federal 

prospective payment rate, we subtract 

the labor portion of the Federal payment 

from the unadjusted Federal prospective 

payment. 

To compute the wage-adjusted 

Federal prospective payment, we 

multiply the result of the labor portion 

of the Federal payment by the 

appropriate wage index found in the 

Addendum in Tables 1 and 2, which 

will result in the wage-adjusted amount. 

Next, we compute the wage-adjusted 

Federal payment by adding the wageadjusted amount to the non-labor 

portion. 

To adjust the Federal prospective 

payment by the facility-level 

adjustments, there are several steps. 

First, we take the wage-adjusted Federal 

prospective payment and multiply it by 

the appropriate rural and LIP 

adjustments (if applicable). Then, to 

determine the appropriate amount of 

additional payment for the teaching 

status adjustment (if applicable), we 

multiply the teaching status adjustment 

(0.109, in this example) by the wageadjusted and rural-adjusted amount (if 

applicable). Finally, we add the 

additional teaching status payments (if 

applicable) to the wage, rural, and LIPadjusted Federal prospective payment 

rate. Table 5 illustrates the components 

of the proposed adjusted payment 

calculation. 

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BILLING CODE 4120–07–C 

Thus, the proposed adjusted payment 

for Facility A would be $32,405.16 and 

the proposed adjusted payment for 

Facility B would be $32,635.56. 

V. Update to Payments for High-Cost 

Outliers Under the IRF PPS 

[If you choose to comment on issues 

in this section, please include the 

caption ‘‘High-Cost Outliers Under the 

IRF PPS’’ at the beginning of your 

comments.] 

A. Proposed Update to the Outlier 

Threshold Amount for FY 2008 

Section 1886(j)(4) of the Act provides 

the Secretary with the authority to make 

payments in addition to the basic IRF 

prospective payments for cases 

incurring extraordinarily high costs. A 

case qualifies for an outlier payment if 

the estimated cost of the case exceeds 

the adjusted outlier threshold. We 

calculate the adjusted outlier threshold 

by adding the IRF PPS payment for the 

case (that is, the CMG payment adjusted 

by all of the relevant facility-level 

adjustments) and the adjusted threshold 

amount (also adjusted by all of the 

relevant facility-level adjustments). 

Then, we calculate the estimated cost of 

a case by multiplying the IRF’s overall 

cost-to-charge ratio (CCR) by the 

Medicare allowable covered charge. If 

the estimated cost of the case is higher 

than the adjusted outlier threshold, we 

make an outlier payment for the case 

equal to 80 percent of the difference 

between the estimated cost of the case 

and the outlier threshold. 

In the August 7, 2001 final rule (66 FR 

41316, 41362 through 41363), we 

discussed our rationale for setting the 

outlier threshold amount for the IRF 

PPS so that estimated outlier payments 

would equal 3 percent of total estimated 

payments. Subsequently, we updated 

the IRF outlier threshold amount in the 

FYs 2006 and 2007 IRF PPS final rules 

(70 FR 47880 and 71 FR 48354) to 

maintain estimated outlier payments at 

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and we also stated that we would 

continue to analyze the estimated 

outlier payments for subsequent years 

and adjust the outlier threshold amount 

as appropriate to maintain the 3 percent 

target. 

For this proposed rule, we performed 

an updated analysis of FY 2005 claims 

and IRF–PAI data using the same 

methodology we used to set the initial 

outlier threshold amount when we first 

implemented the IRF PPS in the August 

7, 2001 final rule (66 FR 41316), which 

is also the same methodology we used 

to update the outlier threshold amounts 

for FYs 2006 and 2007. Using the 

updated FY 2005 claims and IRF–PAI 

data, we estimate that IRF outlier 

payments as a percentage of total 

estimated payments for FY 2007 

increased from 3 percent using the FY 

2004 data to approximately 3.8 percent 

using the updated FY 2005 data. We are 

still investigating the reasons for the 

change in estimated outlier payments 

between FY 2004 and FY 2005, and will 

carefully evaluate all possible reasons 

for this change. 

Based on the updated analysis using 

FY 2005 data, and consistent with the 

broad statutory authority conferred 

upon the Secretary in sections 

1886(j)(4)(A)(i) and 1886(j)(4)(A)(ii) of 

the Act, we propose to update the 

outlier threshold amount to $7,522 to 

decrease estimated outlier payments 

from approximately 3.8 to 3 percent of 

total estimated aggregate IRF payments 

for FY 2008. 

The outlier threshold amount for FY 

2008 is subject to change in the final 

rule based on analysis of updated data. 

B. Update to the IRF Cost-to-Charge 

Ratio Ceilings 

In accordance with the methodology 

stated in the August 1, 2003 final rule 

(68 FR 45692 through 45694), we apply 

a ceiling to IRFs’ cost-to-charge ratios 

(CCRs). Using the methodology 

described in that final rule, we propose 

to update the national urban and rural 

CCRs for IRFs. We apply the national 

urban and rural CCRs in the following 

situations: 

• New IRFs that have not yet 

submitted their first Medicare cost 

report. 

• IRFs whose overall CCR is in excess 

of 3 standard deviations above the 

corresponding national geometric mean, 

which we propose to set at 1.55 (based 

on the current estimate) for FY 2008. 

• Other IRFs for whom accurate data 

with which to calculate an overall CCR 

are not available. 

Specifically, for FY 2008, we estimate 

a proposed national CCR of 0.589 for 

rural IRFs and 0.475 for urban IRFs. For 

new facilities, we use these national 

ratios until the data become available 

for us to compute the facility’s actual 

CCR using the first tentative settled or 

final settled cost report data, which we 

will then use for the subsequent cost 

reporting period. We note that the 

proposed national average rural and 

urban CCRs and our estimate of 3 

standard deviations above the 

corresponding national geometric mean 

in this section are subject to change in 

the final rule based on updated analysis 

and data. 

C. Adjustment of IRF Outlier Payments 

In the August 1, 2003 final rule (68 FR 

45674, 45693 through 45694), we 

finalized a proposal to make IRF outlier 

payments subject to reconciliation when 

IRFs’ cost reports are settled, consistent 

with the policy adopted for IPPS 

hospitals in the June 9, 2003 IPPS final 

rule (68 FR 34494, 34501). The revised 

methodology provides for retroactive 

adjustments to IRF outlier payments to 

account for differences between the 

CCRs from the latest settled cost report 

and the actual CCRs computed at the 

time the cost report that coincides with 

the date of discharge is settled using the 

cost and charge data from that cost 

report. This revised methodology 

addresses vulnerabilities found in the 

IPPS and the IRF outlier payment 

policies, which may have resulted in 

outlier payments that were too high or 

too low. Along these lines, we are 

analyzing IRF outlier payments from the 

beginning of the IRF PPS through FY 

2005, obtained from IRFs’ cost report 

filings, to identify specific payment 

vulnerabilities in the IRF outlier 

payment policy. 

Under this policy, which is outlined 

in § 412.624(e)(5), which in turn 

references § 412.84(i) and § 412.84(m) of 

the IPPS regulations, outlier payments 

will be processed on an interim basis 

throughout the year using IRFs’ CCRs 

based on the best information available 

at the time. When an IRF’s cost report 

is settled, any reconciliation of outlier 

payments by fiscal intermediaries will 

be based on the relationship between an 

IRF’s costs and charges at the time a 

particular discharge actually occurred. 

This revised methodology ensures that 

the final outlier payments reflect an 

accurate assessment of the actual costs 

the IRF incurred for treating the case. 

We have not yet issued instructions to 

the fiscal intermediaries regarding IRF 

outlier reconciliation because we have 

been analyzing the data and assessing 

the systems changes necessary to 

conduct the reconciliation. Thus, we 

will soon issue instructions to fiscal 

intermediaries to begin reconciling IRF 

outlier payments upon settlement of IRF 

cost reports. 

VI. Clarification to the Regulation Text 

for Special Payment Provisions for 

Patients That Are Transferred 

[If you choose to comment on issues 

in this section, please include the 

caption ‘‘Clarification to the Regulation 

Text for Special Payment Provisions for 

Patients that are Transferred’’ at the 

beginning of your comments.] 

Section 125(a)(3) of the BBRA 

amended Section 1886(j)(1) of the Act 

by adding a paragraph (E) that states 

‘‘Construction relating to transfer 

authority—Nothing in this subsection 

shall be construed as preventing the 

Secretary from providing for an 

adjustment to payments to take into 

account the early transfer of a patient 

from a rehabilitation facility to another 

site of care.’’ In the FY 2002 proposed 

and final IRF PPS rules, we proposed 

and adopted the transfer payment policy 

under § 412.624(f). The transfer policy 

provides payments that more accurately 

reflect facility resources used and 

services delivered for patients that 

transfer to another site of care as 

discussed in the FY 2002 IRF PPS final 

rule (66 FR 41316, 41353 through 

41355). We are proposing to revise our 

regulations text to clarify our existing 

policy under § 412.624(f). 

In the FY 2002 IRF PPS final rule (66 

FR 41316, 41353 through 41355), we 

discuss our rationale, criteria for 

defining a transfer case, and the 

methodology to determine the 

unadjusted Federal prospective 

payment for the transfer case. In 

addition, we discuss several 

adjustments that we apply to the 

unadjusted Federal prospective 

payment rate. The final adjustments 

described in the FY 2002 IRF PPS final 

rule (65 FR 66304, 66347 through 

66357) include the area wage 

adjustment, rural adjustment, the LIP 

adjustment, and the high-cost outlier 

adjustment. In our FY 2006 IRF PPS 

final rule (70 FR 47880), we refined the 

facility level adjustments and also 

adopted a teaching status adjustment. 

We define a transfer under § 412.602 

to mean the release of a Medicare 

inpatient from an IRF to another IRF, a 

short-term, acute-care prospective 

payment hospital, a long-term care 

hospital as described in § 412.23(e), or 

a nursing home that qualifies to receive 

Medicare or Medicaid payment. In order 

to receive a transfer payment under 

§ 412.624(f), a patient must be 

transferred to another site of care as 

defined in § 412.602 and had to have 

stayed in the IRF for less than the 

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group (CMG). Table 1 in this proposed 

rule presents the CMGs, the comorbidity 

tiers, the corresponding relative 

weights, and the average length of stay 

value for each CMG and tier. We use the 

average length of stay for each CMG to 

determine when an IRF discharge meets 

the definition of a transfer, which 

results in a per diem case level 

adjustment. 

Since the implementation of the IRF 

PPS, we determine whether a claim 

meets the high-cost outlier policy under 

§ 412.624(e)(5), as revised in the FY 

2007 IRF PPS final rule (71 FR 48354, 

48382 through 48383). A case qualifies 

for an outlier payment if the estimated 

cost of the case exceeds the adjusted 

outlier threshold, in which case we 

make an outlier payment equal to 80 

percent of the difference between the 

estimated cost of the case and the 

outlier threshold. Since the 

implementation of the IRF PPS, we have 

provided an additional high-cost outlier 

payment to both transfer cases and full 

CMG cases when applicable. We 

propose to clarify the regulations text to 

articulate the transfer policy more 

clearly. Specifically, we propose to add 

the phrase ‘‘subject to paragraph (e)(5)’’

at the end of the paragraph under 

§ 412.624(f)(2)(v). The proposed revised 

§ 412.624(f)(2)(v) will read, ‘‘By 

applying the adjustment described in 

paragraphs (e)(1), (e)(2), (e)(3), (e)(4), 

and (e)(7) of this section to the 

unadjusted payment amount 

determined in paragraph (f)(2)(iv) of this 

section to equal the adjusted transfer 

payment amount, subject to paragraph 

(e)(5).’’

VII. Provisions of the Proposed 

Regulation 

[If you choose to comment on issues 

in this section, please include the 

caption ‘‘Provisions of the Proposed 

Regulations’’ at the beginning of your 

comments.] 

We are proposing to make revisions to 

the regulation text in order to 

implement the proposed policy changes 

for IRFs for FY 2007 and subsequent 

fiscal years. Specifically, we are 

proposing to make conforming changes 

in 42 CFR part 412. We discuss these 

proposed revisions and others in detail 

below. 

A. Section 412.624 Methodology for 

Calculating the Federal Prospective 

Payment Rates 

In this section, we are proposing to 

revise the current regulations text in 

paragraph (f)(2)(v) to clarify that we 

determine whether a high-cost outlier 

payment would be applicable for 

transfer cases. We emphasize that this is 

not a change to our current methodology 

for determining whether a high-cost 

outlier payment applies to transfer 

cases. 

B. Additional Proposed Changes 

• Update the FY 2008 IRF PPS 

payment rates by the proposed market 

basket, as discussed in section IV.A. 

• Update the FY 2008 IRF PPS 

payment rates by the proposed wage 

index and the labor related share in a 

budget neutral manner, as discussed in 

section IV.A and B. 

• Update the pre-reclassified and prefloor wage indexes based on the CBSA 

changes published in the most recent 

OMB bulletins that apply to the hospital 

wage data used to determine the current 

IRF PPS wage index, as discussed in 

section IV.B. 

• Implement the final year of the 

three-year hold harmless policy adopted 

in the FY 2006 IRF PPS final rule (70 

FR 47880, 447923 through 47926) in a 

budget neutral manner, as discussed in 

section IV.B. 

• Update the outlier threshold 

amount for FY 2008 to $7,522, as 

discussed in section V.A. 

• Update the cost-to-charge ratio 

ceiling and the national average urban 

and rural cost-to-charge ratios for 

purposes of determining outlier 

payments under the IRF PPS, as 

discussed in section V.B. 

VIII. Collection of Information 

Requirements 

This document does not impose 

information collection and 

recordkeeping requirements. 

Consequently, it need not be reviewed 

by the Office of Management and 

Budget under the authority of the 

Paperwork Reduction Act of 1995. 

IX. Response to Public 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. 

X. Regulatory Impact Analysis 

[If you choose to comment on issues 

in this section, please include the 

caption ‘‘Regulatory Impact Analysis’’ at 

the beginning of your comments.] 

A. Overall Impact 

We have examined the impacts of this 

proposed rule as required by Executive 

Order 12866 (September 1993, 

Regulatory Planning and Review), the 

Regulatory Flexibility Act (RFA, 

September 16, 1980, Pub. L. 96–354), 

section 1102(b) of the Social Security 

Act, the Unfunded Mandates Reform 

Act of 1995 (Pub. L. 104–4), and 

Executive Order 13132. 

Executive Order 12866 (as amended 

by Executive Order 13258, which 

merely reassigns responsibility of 

duties) directs 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 

effects, distributive impacts, and 

equity). A regulatory impact analysis 

(RIA) must be prepared for major rules 

with economically significant effects 

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

This proposed rule is a major rule, as 

defined in Title 5, United States Code, 

section 804(2), because we estimate the 

impact to the Medicare program, and 

the annual effects to the overall 

economy, would be more than $100 

million. We estimate that the total 

impact of these proposed changes for 

estimated FY 2008 payments compared 

to estimated FY 2007 payments would 

be an increase of approximately $150 

million (this reflects a $200 million 

increase from the update to the payment 

rates and a $50 million decrease due to 

the proposed update to the outlier 

threshold amount to decrease estimated 

outlier payments from approximately 

3.8 percent in FY 2007 to 3 percent in 

FY 2008). 

The RFA requires agencies to analyze 

options for regulatory relief of small 

entities. For purposes of the RFA, small 

entities include small businesses, 

nonprofit organizations, and 

government jurisdictions. Most IRFs and 

most other providers and suppliers are 

considered small entities, either by 

nonprofit status or by having revenues 

of $6 million to $29 million in any one 

year. (For details, see the Small 

Business Administration’s final rule that 

set forth size standards for health care 

industries, at 65 FR 69432, November 

17, 2000.) Because we lack data on 

individual hospital receipts, we cannot 

determine the number of small 

proprietary IRFs or the proportion of 

IRFs’ revenue that is derived from 

Medicare payments. Therefore, we 

assume that all IRFs (an approximate 

total of 1,200 IRFs, of which 

approximately 60 percent are nonprofit 

facilities) are considered small entities 

and that Medicare payment constitutes 

the majority of their revenues. The 

Department of Health and Human 


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Services generally uses a revenue 

impact of 3 to 5 percent as a significance 

threshold under the RFA. As shown in 

Table 6, we estimate that the net 

revenue impact of this proposed rule on 

all IRFs is to increase estimated 

payments by about 2.4 percent, with an 

estimated increase in payments of 3 

percent or higher for some categories of 

IRFs (such as rural freestanding IRFs, 

urban IRFs in the East North Central and 

Mountain regions, and rural IRFs in the 

Middle Atlantic and East South Central 

regions). Thus, we anticipate that this 

proposed rule may have a significant 

impact on a substantial number of small 

entities. However, the estimated impact 

of this proposed rule is a net increase in 

revenues across all categories of IRFs, so 

we believe that this proposed rule 

would not impose a significant burden 

on small entities. Medicare fiscal 

intermediaries and carriers 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 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 rural 

hospitals based on the data of the 199 

rural units and 20 rural hospitals in our 

database of 1,234 IRFs for which data 

were available. 

Section 202 of the Unfunded 

Mandates Reform Act of 1995 (Pub. L. 

104–4) also requires that agencies assess 

anticipated costs and benefits before 

issuing any rule whose mandates 

require spending in any one year of 

$100 million in 1995, updated annually 

for inflation. That threshold level is 

currently approximately $120 million. 

This proposed rule would not mandate 

any requirements for State, local, or 

tribal governments, nor would it affect 

private sector costs. 

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. 

B. Anticipated Effects of the Proposed 

Rule 

We discuss below the impacts of this 

proposed rule on the budget and on 

IRFs. 

1. Basis and Methodology of Estimates 

This proposed rule sets forth updates 

of the IRF PPS rates contained in the FY 

2007 final rule, proposes an update to 

the outlier threshold for high-cost cases, 

and proposes an adjustment to the wage 

index methodology. 

Based on the above, we estimate that 

the FY 2008 impact would be a net 

increase of $150 million in payments to 

IRF providers (this reflects a $200 

million estimated increase from the 

proposed update to the payment rates 

and a $50 million estimated decrease 

due to the proposed update to the 

outlier threshold amount to decrease the 

estimated outlier payments from 

approximately 3.8 percent in FY 2007 to 

3 percent in FY 2008). The impact 

analysis in Table 6 of this proposed rule 

represents the projected effects of the 

proposed policy changes in the IRF PPS 

for FY 2008 compared with estimated 

IRF PPS payments in FY 2007 without 

the proposed policy changes. We 

estimate the effects by estimating 

payments while holding all other 

payment variables constant. We use the 

best data available, but we do not 

attempt to predict behavioral responses 

to these proposed changes, except 

where noted, and we do not make 

adjustments for future changes in such 

variables as number of discharges or 

case-mix, except where noted. 

We note that certain events may 

combine to limit the scope or accuracy 

of our impact analysis, because such an 

analysis is future-oriented and, thus, 

susceptible to forecasting errors because 

of other changes in the forecasted 

impact time period. Some examples 

could be legislative changes made by 

the Congress to the Medicare program 

that would impact program funding, or 

changes specifically related to IRFs. In 

addition, changes to the Medicare 

program may continue to be made as a 

result of the BBA, the BBRA, the BIPA, 

the MMA, the DRA, or new statutory 

provisions. Although these changes may 

not be specific to the IRF PPS, the 

nature of the Medicare program is such 

that the changes may interact, and the 

complexity of the interaction of these 

changes could make it difficult to 

predict accurately the full scope of the 

impact upon IRFs. 

In updating the rates for FY 2008, we 

proposed a number of standard annual 

revisions and clarifications mentioned 

elsewhere in this proposed rule (for 

example, the update to the wage and 

market basket indexes used to adjust the 

Federal rates). We estimate that these 

proposed revisions would increase 

payments to IRFs by approximately 

$200 million. 

The aggregate change in estimated 

payments associated with this proposed 

rule is estimated to be an increase in 

payments to IRFs of $150 million for FY 

2008. The market basket increase of 

$200 million and the $50 million 

decrease due to the proposed update to 

the outlier threshold amount to decrease 

estimated outlier payments from 

approximately 3.8 percent in FY 2007 to 

3.0 percent in FY 2008 would result in 

a net change in estimated payments 

from FY 2007 to FY 2008 of $150 

million. 

The effects of the proposed changes 

that affect IRF PPS payment rates are 

shown in Table 6. The following 

proposed changes that affect the IRF 

PPS payment rates are discussed 

separately below: 

• The effects of the proposed update 

to the outlier threshold amount to 

decrease total estimated outlier 

payments from approximately 3.8 to 3 

percent of total estimated payments for 

FY 2008, consistent with section 

1886(j)(4) of the Act. 

• The effects of the annual market 

basket update (using the RPL market 

basket) to IRF PPS payment rates, as 

required by sections 1886(j)(3)(A)(i) and 

1886(j)(3)(C) of the Act. 

• The effects of applying the budgetneutral labor-related share and wage 

index adjustment, including a proposal 

to revise our methodology to determine 

a proxy for rural areas without hospital 

wage data (as described in section IV of 

this proposed rule), as required under 

section 1886(j)(6) of the Act. 

• The effects of the final year of the 

3-year budget-neutral hold-harmless 

policy for IRFs that were rural under 

§ 412.602 during FY 2005, but are urban 

under § 412.602 beginning FY 2006 and 

lose the rural adjustment, resulting in a 

decrease in the estimated IRF PPS 

payments if not for the hold harmless 

policy. 

• The total proposed change in 

estimated payments based on the FY 

2008 proposed policies relative to 

estimated FY 2007 payments without 

the proposed policies. 

2. Description of Table 6 

The table below categorizes IRFs by 

geographic location, including urban or 

rural location and location with respect 

to CMS’s nine census divisions (as 

defined on the cost report) of the 

country. In addition, the table divides 

IRFs into those that are separate 


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rehabilitation hospitals (otherwise 

called freestanding hospitals in this 

section), those that are rehabilitation 

units of a hospital (otherwise called 

hospital units in this section), rural or 

urban facilities, ownership (otherwise 

called for-profit, non-profit, and 

government), and by teaching status. 

The top row of the table shows the 

overall impact on the 1,234 IRFs 

included in the analysis. 

The next 12 rows of Table 6 contain 

IRFs categorized according to their 

geographic location, designation as 

either a freestanding hospital or a unit 

of a hospital, and by type of ownership; 

all urban, which is further divided into 

urban units of a hospital, urban 

freestanding hospitals, and by type of 

ownership; and all rural, which is 

further divided into rural units of a 

hospital, rural freestanding hospitals, 

and by type of ownership. There are 

1,015 IRFs located in urban areas 

included in our analysis. Among these, 

there are 816 IRF units of hospitals 

located in urban areas and 199 

freestanding IRF hospitals located in 

urban areas. There are 219 IRFs located 

in rural areas included in our analysis. 

Among these, there are 199 IRF units of 

hospitals located in rural areas and 20 

freestanding IRF hospitals located in 

rural areas. There are 419 for-profit 

IRFs. Among these, there are 340 IRFs 

in urban areas and 79 IRFs in rural 

areas. There are 748 non-profit IRFs. 

Among these, there are 624 urban IRFs 

and 124 rural IRFs. There are 67 

government-owned IRFs. Among these, 

there are 51 urban IRFs and 16 rural 

IRFs. 

The remaining three parts of Table 6 

show IRFs grouped by their geographic 

location within a region, and the last 

part groups IRFs by teaching status. 

First, IRFs located in urban areas are 

categorized with respect to their 

location within a particular one of the 

nine CMS geographic regions. Second, 

IRFs located in rural areas are 

categorized with respect to their 

location within a particular one of the 

nine CMS geographic regions. In some 

cases, especially for rural IRFs located 

in the New England, Mountain, and 

Pacific regions, the number of IRFs 

represented is small. Finally, IRFs are 

grouped by teaching status, including 

non-teaching IRFs, IRFs with an intern 

and resident to average daily census 

(ADC) ratio less than 10 percent, IRFs 

with an intern and resident to ADC ratio 

greater than or equal to 10 percent and 

less than or equal to 19 percent, and 

IRFs with an intern and resident to ADC 

ratio greater than 19 percent. 

The estimated impacts of each 

proposed change to the facility 

categories listed above are shown in the 

columns of Table 6. The description of 

each column is as follows: 

Column (1) shows the facility 

classification categories described 

above. 

Column (2) shows the number of IRFs 

in each category. 

Column (3) shows the number of 

cases in each category. 

Column (4) shows the estimated effect 

of the proposed adjustment to the 

outlier threshold amount so that 

estimated outlier payments decrease 

from approximately 3.8 percent in FY 

2007 to 3 percent of total estimated 

payments for FY 2008. 

Column (5) shows the estimated effect 

of the market basket update to the IRF 

PPS payment rates. 

Column (6) shows the estimated effect 

of the update to the IRF labor-related 

share, wage index, and the final year of 

the hold harmless policy, in a budget 

neutral manner. 

Column (7) compares our estimates of 

the payments per discharge, 

incorporating all of the proposed 

changes reflected in this proposed rule 

for FY 2008, to our estimates of 

payments per discharge in FY 2007 

(without these proposed changes). The 

average estimated increase for all IRFs is 

approximately 2.4 percent. This 

estimated increase includes the effects 

of the 3.3 percent market basket update. 

It also includes the 0.9 percent overall 

estimated decrease in estimated IRF 

outlier payments from the proposed 

update to the outlier threshold amount. 

Because we are making the remainder of 

the proposed changes outlined in this 

proposed rule in a budget-neutral 

manner, they would not affect total 

estimated IRF payments in the 

aggregate. However, as described in 

more detail in each section, they would 

affect the estimated distribution of 

payments among providers. 

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BILLING CODE 4120–07–C 

3. Impact of the Proposed Update to the 

Outlier Threshold Amount (Column 4, 

Table 6) 

In the FY 2007 IRF PPS final rule (71 

FR 48354), we used FY 2004 patientlevel claims data (the best, most 

complete data available at that time) to 

set the outlier threshold amount for FY 

2007 so that estimated outlier payments 

would equal 3 percent of total estimated 

payments for FY 2007. For this 

proposed rule, we are proposing to 

update our analysis using FY 2005 data. 

Using the updated FY 2005 data, we 

now estimate that IRF outlier payments 

as a percentage of total estimated 

payments for FY 2007 increased from 3 

percent using the FY 2004 data to 

approximately 3.8 percent using the 

updated FY 2005 data. Thus, we are 

proposing to adjust the outlier threshold 

amount for FY 2008 to $7,522 to set 

total estimated outlier payments equal 

to 3 percent of total estimated payments 

in FY 2008. The proposed estimated 

change in total payments between FY 

2007 and FY 2008, therefore, includes a 

0.9 percent (rounded from 0.85 percent) 

overall estimated decrease in payments 

because the estimated outlier portion of 

total payments is estimated to decrease 

from approximately 3.8 percent to 3 

percent. 

The impact of this proposed update 

(as shown in column 4 of Table 6) is to 

decrease estimated overall payments to 

IRFs by 0.9 percent. We do not estimate 

that any group of IRFs would experience 

an increase in payments from this 

proposed update. We estimate the 

largest decrease in payments to be a 1.7 

percent decrease in estimated payments 

to rural IRFs in the Mountain region. 

4. Impact of the Proposed Market Basket 

Update to the IRF PPS Payment Rates 

(Column 5, Table 6) 

In column 5 of Table 6, we present the 

estimated effects of the proposed market 

basket update to the IRF PPS payment 

rates. In the aggregate, and across all 

hospital groups, the proposed update 

would result in a 3.3 percent increase in 

overall estimated payments to IRFs. 

5. Impact of the Proposed CBSA Wage 

Index, Labor-Related Share, and the 

Hold Harmless Policy for FY 2008 

(Column 6, Table 6). 

In column 6 of Table 6, we present the 

effects of the proposed budget neutral 

update of the wage index, labor-related 

share, and the final year of the hold 

harmless policy. In FY 2006, we 

provided a 1-year blended wage index 

and a 3-year phase out of the rural 

adjustment for IRFs that changed 

designation because of the change from 

MSAs to CBSAs (referenced as the hold 

harmless policy). We applied the 

blended wage index to all IRFs and the 

hold harmless policy to those IRFs that 

qualify, as described in § 412.624(e)(7), 

in order to mitigate the impact of the 

change from the MSA-based labor area 

definitions to the CBSA-based labor area 

definitions for IRFs. 

As discussed in the FY 2007 IRF PPS 

final rule (71 FR 48345), the blended 

wage index expired in FY 2007 and will 

not be applied for discharges occurring 

on or after October 1, 2006. In addition, 

FY 2008 is the third and final year of the 

hold harmless policy, and we are 

continuing to apply this policy as 

described in the FY 2006 final rule in 

a budget neutral manner. 

As discussed in this proposed rule, 

we are proposing to revise our 

methodology to impute a rural wage 

index value for rural areas without 

hospital wage data and update the wage 

index based on the CBSA-based labor 

market area definitions in a budget 

neutral manner. We are also applying 

the third and final year of the hold 

harmless policy in a budget neutral 

manner. Thus, in the aggregate, the 

estimated impact of the proposed 

update to the wage index and laborrelated share is zero percent. 

In the aggregate and for all urban 

IRFs, we do not estimate that these 

proposed changes would affect overall 

estimated payments to IRFs. However, 

we estimate that these proposed changes 

would have small distributional effects. 

We estimate a 0.2 percent increase in 

estimated payments to rural IRFs. We 

estimate the largest increase in 

payments to be a 0.7 percent increase 

for urban IRFs in the Mountain region 

and for rural IRFs in the Middle Atlantic 

region. We estimate the largest decrease 

in payments to be a 0.9 percent decrease 

for rural IRFs in the New England 

region. 

C. Anticipated Effects of the 75 Percent 

Rule Policy 

The existing policy for classifying a 

facility as an IRF, which is described in 

§ 412.23(b)(2), allows the inclusion of 

comorbidities meeting certain 

requirements in the calculations used to 

determine the compliance percentage 

for cost reporting periods beginning on 

or after July 1, 2004, and before July 1, 

2008. However, for cost reporting 

periods beginning on or after July 1, 

2008, comorbidities will not be eligible 

for inclusion in the calculations used to 

determine if the provider meets the 75 

percent compliance threshold. As 

discussed in section II of this proposed 

rule, we are not proposing to change 

existing policy. On or after July 1, 2008, 

we anticipate that IRFs would make 

adjustments to their admission and 

coding practices to continue to meet the 

compliance threshold. Data limitations 

and two important sources of 

uncertainty prevent a precise estimate of 

the effect of this policy at this time. One 

source of uncertainty is what proportion 

of patients who would no longer be 

treated in IRFs would instead be treated 

by other, lower-cost post-acute care 

settings such as skilled nursing facilities 

or home health agencies. Another 

source of uncertainty is determining 

how providers will make adjustments 

on or after July 1, 2008. While we 

cannot make a precise estimate at this 

time, we anticipate modest decreases in 

Medicare payments beginning on or 

after July 1, 2008. 

D. Alternatives Considered 

Because we have determined that this 

proposed rule would have a significant 

economic impact on IRFs and on a 

substantial number of small entities, we 

will discuss the alternative changes to 

the IRF PPS that we considered. 

Section 1886(j)(3)(C) of the Act 

requires the Secretary to update the IRF 

PPS payment rates by an increase factor 

that reflects changes over time in the 

prices of an appropriate mix of goods 

and services included in the covered 

IRF services. As discussed above, we 

estimate the RPL market basket increase 

factor for FY 2008 to be 3.3 percent. 

This increase factor represents the 

majority of the impact on IRF providers 

shown in Table 6. Thus, we believe this 

estimated net increase in payments 

across all categories of IRFs represents 

a benefit to IRF providers and, thus, to 

IRFs that are small entities. 

We considered maintaining the 

existing outlier threshold amount for FY 

2008 because this proposed update 

would have a negative impact on IRF 

providers and, therefore, on small 

entities. If we maintain the FY 2007 

outlier threshold amount, more outlier 

cases would have qualified for the 

additional outlier payments in FY 2008. 

However, analysis of updated FY 2005 

data indicates that estimated outlier 

payments would not equal 3 percent of 

estimated total payments for FY 2008 

unless we proposed to update the 

outlier threshold amount. Also, we 

estimate that the effect of this proposal 

on estimated payments to IRFs is small 

(less than 1 percent). 

E. Accounting Statement 

As required by OMB Circular A–4 

(available at http:// 

www.whitehouse.gov/omb/circulars/ 

a004/a-4.pdf), in Table 8 below, we 


cprice-sewell on PROD1PC64 with PROPOSALS3
26256 Federal Register / Vol. 72, No. 88 / Tuesday, May 8, 2007 / Proposed Rules 

have prepared an accounting statement 

showing the classification of the 

expenditures associated with the 

provisions of this proposed rule. This 

table provides our best estimate of the 

increase in Medicare payments under 

the IRF PPS as a result of the proposed 

changes presented in this proposed rule 

based on the data for 1,234 IRFs in our 

database. All estimated expenditures are 

classified as transfers to Medicare 

providers (that is, IRFs). 

TABLE 8.—ACCOUNTING STATEMENT: 

CLASSIFICATION OF ESTIMATED EXPENDITURES, FROM THE 2007 IRF 

PPS RATE YEAR TO THE 2008 IRF 

PPS RATE YEAR (IN MILLIONS) 

Category Transfers 

Annualized Monetized 

Transfers.

$150 million. 

From Whom To 

Whom? 

Federal Government 

to IRF Medicare 

Providers. 

F. Conclusion (Column 7, Table 6) 

Overall, the estimated payments per 

discharge for IRFs in FY 2008 are 

projected to increase by 2.4 percent, 

compared with those in FY 2007, as 

reflected in column 7 of Table 6. We 

estimate that IRFs in urban areas would 

experience a 2.4 percent increase in 

estimated payments per discharge 

compared with FY 2007. We estimate 

that IRFs in rural areas would 

experience a 2.7 percent increase in 

estimated payments per discharge 

compared with FY 2007. We estimate 

that rehabilitation units and 

freestanding rehabilitation hospitals in 

urban areas would both experience a 2.4 

percent increase in estimated payments 

per discharge. We estimate that 

rehabilitation units in rural areas would 

experience a 2.6 percent increase in 

estimated payments per discharge, 

while freestanding rehabilitation 

hospitals in rural areas would 

experience a 3.1 percent increase in 

estimated payments per discharge. 

Overall, we estimate that the largest 

payment increase would be 3.4 percent 

among rural IRFs in the Middle Atlantic 

region. We do not estimate that any 

group of IRFs would experience an 

overall decrease in payments from the 

proposed changes in this proposed rule. 

In accordance with the provisions of 

Executive Order 12866, this regulation 

was reviewed by the Office of 

Management and Budget. 

List of Subjects in 42 CFR Part 412 

Administrative practice and 

procedure, Health facilities, Medicare, 

Puerto Rico, Reporting and 

recordkeeping requirements. 

For the reasons set forth in the 

preamble, the Centers for Medicare & 

Medicaid Services proposes to amend 

42 CFR chapter IV as follows: 

PART 412—PROSPECTIVE PAYMENT 

SYSTEMS FOR INPATIENT HOSPITAL 

SERVICES 

1. The authority citation for part 412 

continues to read as follows: 

Authority: Secs. 1102 and 1871 of the 

Social Security Act (42 U.S.C. 1302 and 

1395hh). 

Subpart P—Prospective Payment for 

Inpatient Rehabilitation Hospitals and 

Rehabilitation Units 

2. Section 412.624 is amended by 

revising paragraph (f)(2)(v) to read as 

follows: 

§ 412.624 Methodology for calculating the 

Federal prospective payment rates. 

* * * * * 

(f) * * * 

(2) * * * 

(v) By applying the adjustment 

described in paragraphs (e)(1), (e)(2), 

(e)(3), (e)(4), and (e)(7) of this section to 

the unadjusted payment amount 

determined in paragraph (f)(2)(iv) of this 

section to equal the adjusted transfer 

payment amount, subject to paragraph 

(e)(5) of this section. 

(Catalog of Federal Domestic Assistance 

Program No. 93.773, Medicare—Hospital 

Insurance; and Program No. 93.774, 

Medicare—Supplemental Medical Insurance 

Program). 

Dated: March 22, 2007. 

Leslie V. Norwalk, 

Acting Administrator, Centers for Medicare 

& Medicaid Services. 

Approved: April 3, 2007. 

Michael O. Leavitt, 

Secretary. 


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The following addendum will not 

appear in the Code of Federal 

Regulations. 

Addendum 

This addendum contains the tables 

referred to throughout the preamble of 

this proposed rule. The tables presented 

below are as follows: 

Table 1.—Proposed Inpatient 

Rehabilitation Facility Wage Index for 

Urban Areas for Discharges Occurring 

from October 1, 2007 through 

September 30, 2008 

Table 2.—Proposed Inpatient 

Rehabilitation Facility Wage Index for 

Rural Areas for Discharges Occurring 

from October 1, 2007 through 

September 30, 2008 

TABLE 1.—PROPOSED INPATIENT REHABILITATION FACILITY WAGE INDEX FOR URBAN AREAS FOR DISCHARGES

OCCURRING FROM OCTOBER 1, 2007 THROUGH SEPTEMBER 30, 2008 

CBSA 

code Urban area (constituent counties) Wage index 

10180 ....... Abilene, TX ............................................................................................................................................................................ 0.8000 

Callahan County, TX.

Jones County, TX.

Taylor County, TX.

10380 ....... Aguadilla-Isabela-San Sebastia ́n, PR ................................................................................................................................... 0.3915 

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.

10420 ....... Akron, OH .............................................................................................................................................................................. 0.8654 

Portage County, OH.

Summit County, OH.

10500 ....... Albany, GA ............................................................................................................................................................................. 0.8991 

Baker County, GA.

Dougherty County, GA.

Lee County, GA.

Terrell County, GA.

Worth County, GA.

10580 ....... Albany-Schenectady-Troy, NY .............................................................................................................................................. 0.8720 

Albany County, NY.

Rensselaer County, NY.

Saratoga County, NY.

Schenectady County, NY.

Schoharie County, NY.

10740 ....... Albuquerque, NM ................................................................................................................................................................... 0.9458 

Bernalillo County, NM.

Sandoval County, NM.

Torrance County, NM.

Valencia County, NM.

10780 ....... Alexandria, LA ....................................................................................................................................................................... 0.8006 

Grant Parish, LA.

Rapides Parish, LA.

10900 ....... Allentown-Bethlehem-Easton, PA-NJ .................................................................................................................................... 0.9947 

Warren County, NJ.

Carbon County, PA.

Lehigh County, PA.

Northampton County, PA.

11020 ....... Altoona, PA ............................................................................................................................................................................ 0.8812 

Blair County, PA.

11100 ....... Amarillo, TX ........................................................................................................................................................................... 0.9169 

Armstrong County, TX.

Carson County, TX.

Potter County, TX.

Randall County, TX.

11180 ....... Ames, IA ................................................................................................................................................................................ 0.9760 

Story County, IA.

11260 ....... Anchorage, AK ....................................................................................................................................................................... 1.2023 

Anchorage Municipality, AK.

Matanuska-Susitna Borough, AK.

11300 ....... Anderson, IN .......................................................................................................................................................................... 0.8681 

Madison County, IN.

11340 ....... Anderson, SC ........................................................................................................................................................................ 0.9017 

Anderson County, SC.

11460 ....... Ann Arbor, MI ........................................................................................................................................................................ 1.0826 

Washtenaw County, MI.

11500 ....... Anniston-Oxford, AL .............................................................................................................................................................. 0.7770 

Calhoun County, AL.


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26258 Federal Register / Vol. 72, No. 88 / Tuesday, May 8, 2007 / Proposed Rules 

TABLE 1.—PROPOSED INPATIENT REHABILITATION FACILITY WAGE INDEX FOR URBAN AREAS FOR DISCHARGES

OCCURRING FROM OCTOBER 1, 2007 THROUGH SEPTEMBER 30, 2008—Continued 

CBSA 

code Urban area (constituent counties) Wage index 

11540 ....... Appleton, WI .......................................................................................................................................................................... 0.9455 

Calumet County, WI.

Outagamie County, WI.

11700 ....... Asheville, NC ......................................................................................................................................................................... 0.9216 

Buncombe County, NC.

Haywood County, NC.

Henderson County, NC.

Madison County, NC.

12020 ....... Athens-Clarke County, GA .................................................................................................................................................... 0.9856 

Clarke County, GA.

Madison County, GA.

Oconee County, GA.

Oglethorpe County, GA.

12060 ....... Atlanta-Sandy Springs-Marietta, GA ..................................................................................................................................... 0.9762 

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.

12100 ....... Atlantic City, NJ ..................................................................................................................................................................... 1.1831 

Atlantic County, NJ.

12220 ....... Auburn-Opelika, AL ............................................................................................................................................................... 0.8096 

Lee County, AL.

12260 ....... Augusta-Richmond County, GA-SC ...................................................................................................................................... 0.9667 

Burke County, GA.

Columbia County, GA.

McDuffie County, GA.

Richmond County, GA.

Aiken County, SC.

Edgefield County, SC.

12420 ....... Austin-Round Rock, TX ......................................................................................................................................................... 0.9344 

Bastrop County, TX.

Caldwell County, TX.

Hays County, TX.

Travis County, TX.

Williamson County, TX.

12540 ....... Bakersfield, CA ...................................................................................................................................................................... 1.0725 

Kern County, CA.

12580 ....... Baltimore-Towson, MD .......................................................................................................................................................... 1.0088 

Anne Arundel County, MD.

Baltimore County, MD.

Carroll County, MD.

Harford County, MD.

Howard County, MD.

Queen Anne’s County, MD.

Baltimore City, MD.

12620 ....... Bangor, ME ............................................................................................................................................................................ 0.9711 


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Federal Register / Vol. 72, No. 88 / Tuesday, May 8, 2007 / Proposed Rules 26259 

TABLE 1.—PROPOSED INPATIENT REHABILITATION FACILITY WAGE INDEX FOR URBAN AREAS FOR DISCHARGES

OCCURRING FROM OCTOBER 1, 2007 THROUGH SEPTEMBER 30, 2008—Continued 

CBSA 

code Urban area (constituent counties) Wage index 

Penobscot County, ME.

12700 ....... Barnstable Town, MA ............................................................................................................................................................ 1.2539 

Barnstable County, MA.

12940 ....... Baton Rouge, LA ................................................................................................................................................................... 0.8084 

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.

12980 ....... Battle Creek, MI ..................................................................................................................................................................... 0.9762 

Calhoun County, MI.

13020 ....... Bay City, MI ........................................................................................................................................................................... 0.9251 

Bay County, MI.

13140 ....... Beaumont-Port Arthur, TX ..................................................................................................................................................... 0.8595 

Hardin County, TX.

Jefferson County, TX.

Orange County, TX.

13380 ....... Bellingham, WA ..................................................................................................................................................................... 1.1104 

Whatcom County, WA.

13460 ....... Bend, OR ............................................................................................................................................................................... 1.0743 

Deschutes County, OR.

13644 ....... Bethesda-Frederick-Gaithersburg, MD .................................................................................................................................. 1.0903 

Frederick County, MD.

Montgomery County, MD.

13740 ....... Billings, MT ............................................................................................................................................................................ 0.8712 

Carbon County, MT.

Yellowstone County, MT.

13780 ....... Binghamton, NY ..................................................................................................................................................................... 0.8786 

Broome County, NY.

Tioga County, NY.

13820 ....... Birmingham-Hoover, AL ........................................................................................................................................................ 0.8894 

Bibb County, AL.

Blount County, AL.

Chilton County, AL.

Jefferson County, AL.

St. Clair County, AL.

Shelby County, AL.

Walker County, AL.

13900 ....... Bismarck, ND ......................................................................................................................................................................... 0.7240 

Burleigh County, ND.

Morton County, ND.

13980 ....... Blacksburg-Christiansburg-Radford, VA ................................................................................................................................ 0.8213 

Giles County, VA.

Montgomery County, VA.

Pulaski County, VA.

Radford City, VA.

14020 ....... Bloomington, IN ..................................................................................................................................................................... 0.8533 

Greene County, IN.

Monroe County, IN.

Owen County, IN.

14060 ....... Bloomington-Normal, IL ......................................................................................................................................................... 0.8944 

McLean County, IL.

14260 ....... Boise City-Nampa, ID ............................................................................................................................................................ 0.9401 

Ada County, ID.

Boise County, ID.

Canyon County, ID.

Gem County, ID.

Owyhee County, ID.

14484 ....... Boston-Quincy, MA ................................................................................................................................................................ 1.1679 

Norfolk County, MA.

Plymouth County, MA.

Suffolk County, MA.

14500 ....... Boulder, CO ........................................................................................................................................................................... 1.0350 

Boulder County, CO.

14540 ....... Bowling Green, KY ................................................................................................................................................................ 0.8148 

Edmonson County, KY.


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26260 Federal Register / Vol. 72, No. 88 / Tuesday, May 8, 2007 / Proposed Rules 

TABLE 1.—PROPOSED INPATIENT REHABILITATION FACILITY WAGE INDEX FOR URBAN AREAS FOR DISCHARGES

OCCURRING FROM OCTOBER 1, 2007 THROUGH SEPTEMBER 30, 2008—Continued 

CBSA 

code Urban area (constituent counties) Wage index 

Warren County, KY.

14740 ....... Bremerton-Silverdale, WA ..................................................................................................................................................... 1.0913 

Kitsap County, WA.

14860 ....... Bridgeport-Stamford-Norwalk, CT ......................................................................................................................................... 1.2659 

Fairfield County, CT.

15180 ....... Brownsville-Harlingen, TX ..................................................................................................................................................... 0.9430 

Cameron County, TX.

15260 ....... Brunswick, GA ....................................................................................................................................................................... 1.0164 

Brantley County, GA.

Glynn County, GA.

McIntosh County, GA.

15380 ....... Buffalo-Niagara Falls, NY ...................................................................................................................................................... 0.9424 

Erie County, NY.

Niagara County, NY.

15500 ....... Burlington, NC ....................................................................................................................................................................... 0.8674 

Alamance County, NC.

15540 ....... Burlington-South Burlington, VT ............................................................................................................................................ 0.9474 

Chittenden County, VT.

Franklin County, VT.

Grand Isle County, VT.

15764 ....... Cambridge-Newton-Framingham, MA ................................................................................................................................... 1.0970 

Middlesex County, MA.

15804 ....... Camden, NJ ........................................................................................................................................................................... 1.0392 

Burlington County, NJ.

Camden County, NJ.

Gloucester County, NJ.

15940 ....... Canton-Massillon, OH ............................................................................................................................................................ 0.9031 

Carroll County, OH.

Stark County, OH.

15980 ....... Cape Coral-Fort Myers, FL .................................................................................................................................................... 0.9342 

Lee County, FL.

16180 ....... Carson City, NV ..................................................................................................................................................................... 1.0025 

Carson City, NV.

16220 ....... Casper, WY ........................................................................................................................................................................... 0.9145 

Natrona County, WY.

16300 ....... Cedar Rapids, IA ................................................................................................................................................................... 0.8888 

Benton County, IA.

Jones County, IA.

Linn County, IA.

16580 ....... Champaign-Urbana, IL .......................................................................................................................................................... 0.9644 

Champaign County, IL.

Ford County, IL.

Piatt County, IL.

16620 ....... Charleston, WV ...................................................................................................................................................................... 0.8542 

Boone County, WV.

Clay County, WV.

Kanawha County, WV.

Lincoln County, WV.

Putnam County, WV.

16700 ....... Charleston-North Charleston, SC .......................................................................................................................................... 0.9145 

Berkeley County, SC.

Charleston County, SC.

Dorchester County, SC.

16740 ....... Charlotte-Gastonia-Concord, NC-SC .................................................................................................................................... 0.9554 

Anson County, NC.

Cabarrus County, NC.

Gaston County, NC.

Mecklenburg County, NC.

Union County, NC.

York County, SC.

16820 ....... Charlottesville, VA ................................................................................................................................................................. 1.0125 

Albemarle County, VA.

Fluvanna County, VA.

Greene County, VA.

Nelson County, VA.

Charlottesville City, VA.

16860 ....... Chattanooga, TN-GA ............................................................................................................................................................. 0.8948 

Catoosa County, GA.

Dade County, GA.

Walker County, GA.


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TABLE 1.—PROPOSED INPATIENT REHABILITATION FACILITY WAGE INDEX FOR URBAN AREAS FOR DISCHARGES

OCCURRING FROM OCTOBER 1, 2007 THROUGH SEPTEMBER 30, 2008—Continued 

CBSA 

code Urban area (constituent counties) Wage index 

Hamilton County, TN.

Marion County, TN.

Sequatchie County, TN.

16940 ....... Cheyenne, WY ....................................................................................................................................................................... 0.9060 

Laramie County, WY.

16974 ....... Chicago-Naperville-Joliet, IL .................................................................................................................................................. 1.0751 

Cook County, IL.

DeKalb County, IL.

DuPage County, IL.

Grundy County, IL.

Kane County, IL.

Kendall County, IL.

McHenry County, IL.

Will County, IL.

17020 ....... Chico, CA ............................................................................................................................................................................... 1.1053 

Butte County, CA.

17140 ....... Cincinnati-Middletown, OH-KY-IN ......................................................................................................................................... 0.9601 

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.

17300 ....... Clarksville, TN-KY .................................................................................................................................................................. 0.8436 

Christian County, KY.

Trigg County, KY.

Montgomery County, TN.

Stewart County, TN.

17420 ....... Cleveland, TN ........................................................................................................................................................................ 0.8109 

Bradley County, TN.

Polk County, TN.

17460 ....... Cleveland-Elyria-Mentor, OH ................................................................................................................................................. 0.9400 

Cuyahoga County, OH.

Geauga County, OH.

Lake County, OH.

Lorain County, OH.

Medina County, OH.

17660 ....... Coeur d’Alene, ID .................................................................................................................................................................. 0.9344 

Kootenai County, ID.

17780 ....... College Station-Bryan, TX ..................................................................................................................................................... 0.9045 

Brazos County, TX.

Burleson County, TX.

Robertson County, TX.

17820 ....... Colorado Springs, CO ........................................................................................................................................................... 0.9701 

El Paso County, CO.

Teller County, CO.

17860 ....... Columbia, MO ........................................................................................................................................................................ 0.8542 

Boone County, MO.

Howard County, MO.

17900 ....... Columbia, SC ......................................................................................................................................................................... 0.8933 

Calhoun County, SC.

Fairfield County, SC.

Kershaw County, SC.

Lexington County, SC.

Richland County, SC.

Saluda County, SC.

17980 ....... Columbus, GA-AL .................................................................................................................................................................. 0.8239 

Russell County, AL.

Chattahoochee County, GA.

Harris County, GA.

Marion County, GA.


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26262 Federal Register / Vol. 72, No. 88 / Tuesday, May 8, 2007 / Proposed Rules 

TABLE 1.—PROPOSED INPATIENT REHABILITATION FACILITY WAGE INDEX FOR URBAN AREAS FOR DISCHARGES

OCCURRING FROM OCTOBER 1, 2007 THROUGH SEPTEMBER 30, 2008—Continued 

CBSA 

code Urban area (constituent counties) Wage index 

Muscogee County, GA.

18020 ....... Columbus, IN ......................................................................................................................................................................... 0.9318 

Bartholomew County, IN.

18140 ....... Columbus, OH ....................................................................................................................................................................... 1.0107 

Delaware County, OH.

Fairfield County, OH.

Franklin County, OH.

Licking County, OH.

Madison County, OH.

Morrow County, OH.

Pickaway County, OH.

Union County, OH.

18580 ....... Corpus Christi, TX ................................................................................................................................................................. 0.8564 

Aransas County, TX.

Nueces County, TX.

San Patricio County, TX.

18700 ....... Corvallis, OR .......................................................................................................................................................................... 1.1546 

Benton County, OR.

19060 ....... Cumberland, MD-WV ............................................................................................................................................................. 0.8446 

Allegany County, MD.

Mineral County, WV.

19124 ....... Dallas-Plano-Irving, TX .......................................................................................................................................................... 1.0075 

Collin County, TX.

Dallas County, TX.

Delta County, TX.

Denton County, TX.

Ellis County, TX.

Hunt County, TX.

Kaufman County, TX.

Rockwall County, TX.

19140 ....... Dalton, GA ............................................................................................................................................................................. 0.9093 

Murray County, GA.

Whitfield County, GA.

19180 ....... Danville, IL ............................................................................................................................................................................. 0.9266 

Vermilion County, IL.

19260 ....... Danville, VA ........................................................................................................................................................................... 0.8451 

Pittsylvania County, VA.

Danville City, VA.

19340 ....... Davenport-Moline-Rock Island, IA-IL ..................................................................................................................................... 0.8846 

Henry County, IL.

Mercer County, IL.

Rock Island County, IL.

Scott County, IA.

19380 ....... Dayton, OH ............................................................................................................................................................................ 0.9037 

Greene County, OH.

Miami County, OH.

Montgomery County, OH.

Preble County, OH.

19460 ....... Decatur, AL ............................................................................................................................................................................ 0.8159 

Lawrence County, AL.

Morgan County, AL.

19500 ....... Decatur, IL ............................................................................................................................................................................. 0.8172 

Macon County, IL.

19660 ....... Deltona-Daytona Beach-Ormond Beach, FL ......................................................................................................................... 0.9263 

Volusia County, FL.

19740 ....... Denver-Aurora, CO ................................................................................................................................................................ 1.0930 

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.

19780 ....... Des Moines-West Des Moines, IA ........................................................................................................................................ 0.9214 

Dallas County, IA.

Guthrie County, IA.

Madison County, IA.


cprice-sewell on PROD1PC64 with PROPOSALS3
Federal Register / Vol. 72, No. 88 / Tuesday, May 8, 2007 / Proposed Rules 26263 

TABLE 1.—PROPOSED INPATIENT REHABILITATION FACILITY WAGE INDEX FOR URBAN AREAS FOR DISCHARGES

OCCURRING FROM OCTOBER 1, 2007 THROUGH SEPTEMBER 30, 2008—Continued 

CBSA 

code Urban area (constituent counties) Wage index 

Polk County, IA.

Warren County, IA.

19804 ....... Detroit-Livonia-Dearborn, MI ................................................................................................................................................. 1.0281 

Wayne County, MI.

20020 ....... Dothan, AL ............................................................................................................................................................................. 0.7381 

Geneva County, AL.

Henry County, AL.

Houston County, AL.

20100 ....... Dover, DE .............................................................................................................................................................................. 0.9847 

Kent County, DE.

20220 ....... Dubuque, IA ........................................................................................................................................................................... 0.9133 

Dubuque County, IA.

20260 ....... Duluth, MN-WI ....................................................................................................................................................................... 1.0042 

Carlton County, MN.

St. Louis County, MN.

Douglas County, WI.

20500 ....... Durham, NC ........................................................................................................................................................................... 0.9826 

Chatham County, NC.

Durham County, NC.

Orange County, NC.

Person County, NC.

20740 ....... Eau Claire, WI ....................................................................................................................................................................... 0.9630 

Chippewa County, WI.

Eau Claire County, WI.

20764 ....... Edison, NJ ............................................................................................................................................................................. 1.1190 

Middlesex County, NJ.

Monmouth County, NJ.

Ocean County, NJ.

Somerset County, NJ.

20940 ....... El Centro, CA ......................................................................................................................................................................... 0.9076 

Imperial County, CA.

21060 ....... Elizabethtown, KY .................................................................................................................................................................. 0.8697 

Hardin County, KY.

Larue County, KY.

21140 ....... Elkhart-Goshen, IN ................................................................................................................................................................ 0.9426 

Elkhart County, IN.

21300 ....... Elmira, NY .............................................................................................................................................................................. 0.8240 

Chemung County, NY.

21340 ....... El Paso, TX ............................................................................................................................................................................ 0.9053 

El Paso County, TX.

21500 ....... Erie, PA .................................................................................................................................................................................. 0.8827 

Erie County, PA.

21604 ....... Essex County, MA ................................................................................................................................................................. 1.0418 

Essex County, MA.

21660 ....... Eugene-Springfield, OR ......................................................................................................................................................... 1.0876 

Lane County, OR.

21780 ....... Evansville, IN-KY ................................................................................................................................................................... 0.9071 

Gibson County, IN.

Posey County, IN.

Vanderburgh County, IN.

Warrick County, IN.

Henderson County, KY.

Webster County, KY.

21820 ....... Fairbanks, AK ........................................................................................................................................................................ 1.1059 

Fairbanks North Star Borough, AK.

21940 ....... Fajardo, PR ............................................................................................................................................................................ 0.4036 

Ceiba Municipio, PR.

Fajardo Municipio, PR.

Luquillo Municipio, PR.

22020 ....... Fargo, ND-MN ....................................................................................................................................................................... 0.8250 

Cass County, ND.

Clay County, MN.

22140 ....... Farmington, NM ..................................................................................................................................................................... 0.8589 

San Juan County, NM.

22180 ....... Fayetteville, NC ..................................................................................................................................................................... 0.8945 

Cumberland County, NC.

Hoke County, NC.

22220 ....... Fayetteville-Springdale-Rogers, AR-MO ............................................................................................................................... 0.8865 

Benton County, AR.

Madison County, AR.


cprice-sewell on PROD1PC64 with PROPOSALS3
26264 Federal Register / Vol. 72, No. 88 / Tuesday, May 8, 2007 / Proposed Rules 

TABLE 1.—PROPOSED INPATIENT REHABILITATION FACILITY WAGE INDEX FOR URBAN AREAS FOR DISCHARGES

OCCURRING FROM OCTOBER 1, 2007 THROUGH SEPTEMBER 30, 2008—Continued 

CBSA 

code Urban area (constituent counties) Wage index 

Washington County, AR.

McDonald County, MO.

22380 ....... Flagstaff, AZ .......................................................................................................................................................................... 1.1601 

Coconino County, AZ.

22420 ....... Flint, MI .................................................................................................................................................................................. 1.0969 

Genesee County, MI.

22500 ....... Florence, SC .......................................................................................................................................................................... 0.8388 

Darlington County, SC.

Florence County, SC.

22520 ....... Florence-Muscle Shoals, AL .................................................................................................................................................. 0.7843 

Colbert County, AL.

Lauderdale County, AL.

22540 ....... Fond du Lac, WI .................................................................................................................................................................... 1.0063 

Fond du Lac County, WI.

22660 ....... Fort Collins-Loveland, CO ..................................................................................................................................................... 0.9544 

Larimer County, CO.

22744 ....... Fort Lauderdale-Pompano Beach-Deerfield Beach, FL ........................................................................................................ 1.0133 

Broward County, FL.

22900 ....... Fort Smith, AR-OK ................................................................................................................................................................. 0.7731 

Crawford County, AR.

Franklin County, AR.

Sebastian County, AR.

Le Flore County, OK.

Sequoyah County, OK.

23020 ....... Fort Walton Beach-Crestview-Destin, FL .............................................................................................................................. 0.8643 

Okaloosa County, FL.

23060 ....... Fort Wayne, IN ...................................................................................................................................................................... 0.9517 

Allen County, IN.

Wells County, IN.

Whitley County, IN.

23104 ....... Fort Worth-Arlington, TX ........................................................................................................................................................ 0.9569 

Johnson County, TX.

Parker County, TX.

Tarrant County, TX.

Wise County, TX.

23420 ....... Fresno, CA ............................................................................................................................................................................. 1.0943 

Fresno County, CA.

23460 ....... Gadsden, AL .......................................................................................................................................................................... 0.8066 

Etowah County, AL.

23540 ....... Gainesville, FL ....................................................................................................................................................................... 0.9277 

Alachua County, FL.

Gilchrist County, FL.

23580 ....... Gainesville, GA ...................................................................................................................................................................... 0.8958 

Hall County, GA.

23844 ....... Gary, IN ................................................................................................................................................................................. 0.9334 

Jasper County, IN.

Lake County, IN.

Newton County, IN.

Porter County, IN.

24020 ....... Glens Falls, NY ...................................................................................................................................................................... 0.8324 

Warren County, NY.

Washington County, NY.

24140 ....... Goldsboro, NC ....................................................................................................................................................................... 0.9171 

Wayne County, NC.

24220 ....... Grand Forks, ND-MN ............................................................................................................................................................. 0.7949 

Polk County, MN.

Grand Forks County, ND.

24300 ....... Grand Junction, CO ............................................................................................................................................................... 0.9668 

Mesa County, CO.

24340 ....... Grand Rapids-Wyoming, MI .................................................................................................................................................. 0.9455 

Barry County, MI.

Ionia County, MI.

Kent County, MI.

Newaygo County, MI.

24500 ....... Great Falls, MT ...................................................................................................................................................................... 0.8598 

Cascade County, MT.

24540 ....... Greeley, CO ........................................................................................................................................................................... 0.9602 

Weld County, CO.

24580 ....... Green Bay, WI ....................................................................................................................................................................... 0.9787 

Brown County, WI.


cprice-sewell on PROD1PC64 with PROPOSALS3
Federal Register / Vol. 72, No. 88 / Tuesday, May 8, 2007 / Proposed Rules 26265 

TABLE 1.—PROPOSED INPATIENT REHABILITATION FACILITY WAGE INDEX FOR URBAN AREAS FOR DISCHARGES

OCCURRING FROM OCTOBER 1, 2007 THROUGH SEPTEMBER 30, 2008—Continued 

CBSA 

code Urban area (constituent counties) Wage index 

Kewaunee County, WI.

Oconto County, WI.

24660 ....... Greensboro-High Point, NC ................................................................................................................................................... 0.8866 

Guilford County, NC.

Randolph County, NC.

Rockingham County, NC.

24780 ....... Greenville, NC ....................................................................................................................................................................... 0.9432 

Greene County, NC.

Pitt County, NC.

24860 ....... Greenville, SC ........................................................................................................................................................................ 0.9804 

Greenville County, SC.

Laurens County, SC.

Pickens County, SC.

25020 ....... Guayama, PR ........................................................................................................................................................................ 0.3235 

Arroyo Municipio, PR.

Guayama Municipio, PR.

Patillas Municipio, PR.

25060 ....... Gulfport-Biloxi, MS ................................................................................................................................................................. 0.8915 

Hancock County, MS.

Harrison County, MS.

Stone County, MS.

25180 ....... Hagerstown-Martinsburg, MD-WV ......................................................................................................................................... 0.9038 

Washington County, MD.

Berkeley County, WV.

Morgan County, WV.

25260 ....... Hanford-Corcoran, CA ........................................................................................................................................................... 1.0282 

Kings County, CA.

25420 ....... Harrisburg-Carlisle, PA .......................................................................................................................................................... 0.9402 

Cumberland County, PA.

Dauphin County, PA.

Perry County, PA.

25500 ....... Harrisonburg, VA ................................................................................................................................................................... 0.9073 

Rockingham County, VA.

Harrisonburg City, VA.

25540 ....... Hartford-West Hartford-East Hartford, CT ............................................................................................................................. 1.0894 

Hartford County, CT.

Litchfield County, CT.

Middlesex County, CT.

Tolland County, CT.

25620 ....... Hattiesburg, MS ..................................................................................................................................................................... 0.7430 

Forrest County, MS.

Lamar County, MS.

Perry County, MS.

25860 ....... Hickory-Lenoir-Morganton, NC .............................................................................................................................................. 0.9010 

Alexander County, NC.

Burke County, NC.

Caldwell County, NC.

Catawba County, NC.

25980 ....... Hinesville-Fort Stewart, GA1 ................................................................................................................................................. 0.9178 

Liberty County, GA.

Long County, GA.

26100 ....... Holland-Grand Haven, MI ...................................................................................................................................................... 0.9163 

Ottawa County, MI.

26180 ....... Honolulu, HI ........................................................................................................................................................................... 1.1096 

Honolulu County, HI.

26300 ....... Hot Springs, AR ..................................................................................................................................................................... 0.8782 

Garland County, AR.

26380 ....... Houma-Bayou Cane-Thibodaux, LA ...................................................................................................................................... 0.8082 

Lafourche Parish, LA.

Terrebonne Parish, LA.

26420 ....... Houston-Sugar Land-Baytown, TX ........................................................................................................................................ 1.0008 

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.


cprice-sewell on PROD1PC64 with PROPOSALS3
26266 Federal Register / Vol. 72, No. 88 / Tuesday, May 8, 2007 / Proposed Rules 

TABLE 1.—PROPOSED INPATIENT REHABILITATION FACILITY WAGE INDEX FOR URBAN AREAS FOR DISCHARGES

OCCURRING FROM OCTOBER 1, 2007 THROUGH SEPTEMBER 30, 2008—Continued 

CBSA 

code Urban area (constituent counties) Wage index 

Waller County, TX.

26580 ....... Huntington-Ashland, WV-KY-OH ........................................................................................................................................... 0.8997 

Boyd County, KY.

Greenup County, KY.

Lawrence County, OH.

Cabell County, WV.

Wayne County, WV.

26620 ....... Huntsville, AL ......................................................................................................................................................................... 0.9007 

Limestone County, AL.

Madison County, AL.

26820 ....... Idaho Falls, ID ....................................................................................................................................................................... 0.9088 

Bonneville County, ID.

Jefferson County, ID.

26900 ....... Indianapolis-Carmel, IN ......................................................................................................................................................... 0.9895 

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.

26980 ....... Iowa City, IA .......................................................................................................................................................................... 0.9714 

Johnson County, IA.

Washington County, IA.

27060 ....... Ithaca, NY .............................................................................................................................................................................. 0.9928 

Tompkins County, NY.

27100 ....... Jackson, MI ............................................................................................................................................................................ 0.9560 

Jackson County, MI.

27140 ....... Jackson, MS .......................................................................................................................................................................... 0.8271 

Copiah County, MS.

Hinds County, MS.

Madison County, MS.

Rankin County, MS.

Simpson County, MS.

27180 ....... Jackson, TN ........................................................................................................................................................................... 0.8853 

Chester County, TN.

Madison County, TN.

27260 ....... Jacksonville, FL ..................................................................................................................................................................... 0.9165 

Baker County, FL.

Clay County, FL.

Duval County, FL.

Nassau County, FL.

St. Johns County, FL.

27340 ....... Jacksonville, NC .................................................................................................................................................................... 0.8231 

Onslow County, NC.

27500 ....... Janesville, WI ......................................................................................................................................................................... 0.9655 

Rock County, WI.

27620 ....... Jefferson City, MO ................................................................................................................................................................. 0.8332 

Callaway County, MO.

Cole County, MO.

Moniteau County, MO.

Osage County, MO.

27740 ....... Johnson City, TN ................................................................................................................................................................... 0.8043 

Carter County, TN.

Unicoi County, TN.

Washington County, TN.

27780 ....... Johnstown, PA ....................................................................................................................................................................... 0.8620 

Cambria County, PA.

27860 ....... Jonesboro, AR ....................................................................................................................................................................... 0.7662 

Craighead County, AR.

Poinsett County, AR.

27900 ....... Joplin, MO .............................................................................................................................................................................. 0.8605 

Jasper County, MO.

Newton County, MO.

28020 ....... Kalamazoo-Portage, MI ......................................................................................................................................................... 1.0704 

Kalamazoo County, MI.

Van Buren County, MI.


cprice-sewell on PROD1PC64 with PROPOSALS3
Federal Register / Vol. 72, No. 88 / Tuesday, May 8, 2007 / Proposed Rules 26267 

TABLE 1.—PROPOSED INPATIENT REHABILITATION FACILITY WAGE INDEX FOR URBAN AREAS FOR DISCHARGES

OCCURRING FROM OCTOBER 1, 2007 THROUGH SEPTEMBER 30, 2008—Continued 

CBSA 

code Urban area (constituent counties) Wage index 

28100 ....... Kankakee-Bradley, IL ............................................................................................................................................................ 1.0083 

Kankakee County, IL.

28140 ....... Kansas City, MO-KS .............................................................................................................................................................. 0.9495 

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.

28420 ....... Kennewick-Richland-Pasco, WA ........................................................................................................................................... 1.0343 

Benton County, WA.

Franklin County, WA.

28660 ....... Killeen-Temple-Fort Hood, TX ............................................................................................................................................... 0.8901 

Bell County, TX.

Coryell County, TX.

Lampasas County, TX.

28700 ....... Kingsport-Bristol-Bristol, TN-VA ............................................................................................................................................ 0.7985 

Hawkins County, TN.

Sullivan County, TN.

Bristol City, VA.

Scott County, VA.

Washington County, VA.

28740 ....... Kingston, NY .......................................................................................................................................................................... 0.9367 

Ulster County, NY.

28940 ....... Knoxville, TN .......................................................................................................................................................................... 0.8249 

Anderson County, TN.

Blount County, TN.

Knox County, TN.

Loudon County, TN.

Union County, TN.

29020 ....... Kokomo, IN ............................................................................................................................................................................ 0.9669 

Howard County, IN.

Tipton County, IN.

29100 ....... La Crosse, WI-MN ................................................................................................................................................................. 0.9426 

Houston County, MN.

La Crosse County, WI.

29140 ....... Lafayette, IN .......................................................................................................................................................................... 0.8931 

Benton County, IN.

Carroll County, IN.

Tippecanoe County, IN.

29180 ....... Lafayette, LA .......................................................................................................................................................................... 0.8289 

Lafayette Parish, LA.

St. Martin Parish, LA.

29340 ....... Lake Charles, LA ................................................................................................................................................................... 0.7914 

Calcasieu Parish, LA.

Cameron Parish, LA.

29404 ....... Lake County-Kenosha County, IL-WI .................................................................................................................................... 1.0570 

Lake County, IL.

Kenosha County, WI.

29460 ....... Lakeland, FL .......................................................................................................................................................................... 0.8879 

Polk County, FL.

29540 ....... Lancaster, PA ........................................................................................................................................................................ 0.9589 

Lancaster County, PA.

29620 ....... Lansing-East Lansing, MI ...................................................................................................................................................... 1.0088 

Clinton County, MI.

Eaton County, MI.

Ingham County, MI.

29700 ....... Laredo, TX ............................................................................................................................................................................. 0.7811 

Webb County, TX.

29740 ....... Las Cruces, NM ..................................................................................................................................................................... 0.9273 

Dona Ana County, NM.


cprice-sewell on PROD1PC64 with PROPOSALS3
26268 Federal Register / Vol. 72, No. 88 / Tuesday, May 8, 2007 / Proposed Rules 

TABLE 1.—PROPOSED INPATIENT REHABILITATION FACILITY WAGE INDEX FOR URBAN AREAS FOR DISCHARGES

OCCURRING FROM OCTOBER 1, 2007 THROUGH SEPTEMBER 30, 2008—Continued 

CBSA 

code Urban area (constituent counties) Wage index 

29820 ....... Las Vegas-Paradise, NV ....................................................................................................................................................... 1.1430 

Clark County, NV.

29940 ....... Lawrence, KS ........................................................................................................................................................................ 0.8365 

Douglas County, KS.

30020 ....... Lawton, OK ............................................................................................................................................................................ 0.8065 

Comanche County, OK.

30140 ....... Lebanon, PA .......................................................................................................................................................................... 0.8679 

Lebanon County, PA.

30300 ....... Lewiston, ID-WA .................................................................................................................................................................... 0.9853 

Nez Perce County, ID.

Asotin County, WA.

30340 ....... Lewiston-Auburn, ME ............................................................................................................................................................ 0.9126 

Androscoggin County, ME.

30460 ....... Lexington-Fayette, KY ........................................................................................................................................................... 0.9181 

Bourbon County, KY.

Clark County, KY.

Fayette County, KY.

Jessamine County, KY.

Scott County, KY.

Woodford County, KY.

30620 ....... Lima, OH ................................................................................................................................................................................ 0.9042 

Allen County, OH.

30700 ....... Lincoln, NE ............................................................................................................................................................................ 1.0092 

Lancaster County, NE.

Seward County, NE.

30780 ....... Little Rock-North Little Rock, AR ........................................................................................................................................... 0.8890 

Faulkner County, AR.

Grant County, AR.

Lonoke County, AR.

Perry County, AR.

Pulaski County, AR.

Saline County, AR.

30860 ....... Logan, UT-ID ......................................................................................................................................................................... 0.9022 

Franklin County, ID.

Cache County, UT.

30980 ....... Longview, TX ......................................................................................................................................................................... 0.8788 

Gregg County, TX.

Rusk County, TX.

Upshur County, TX.

31020 ....... Longview, WA ........................................................................................................................................................................ 1.0011 

Cowlitz County, WA.

31084 ....... Los Angeles-Long Beach-Glendale, CA ................................................................................................................................ 1.1760 

Los Angeles County, CA.

31140 ....... Louisville, KY-IN .................................................................................................................................................................... 0.9118 

Clark County, IN.

Floyd County, IN.

Harrison County, IN.

Washington County, IN.

Bullitt County, KY.

Henry County, KY.

Jefferson County, KY.

Meade County, KY.

Nelson County, KY.

Oldham County, KY.

Shelby County, KY.

Spencer County, KY.

Trimble County, KY.

31180 ....... Lubbock, TX ........................................................................................................................................................................... 0.8613 

Crosby County, TX.

Lubbock County, TX.

31340 ....... Lynchburg, VA ....................................................................................................................................................................... 0.8694 

Amherst County, VA.

Appomattox County, VA.

Bedford County, VA.

Campbell County, VA.

Bedford City, VA.

Lynchburg City, VA.

31420 ....... Macon, GA ............................................................................................................................................................................. 0.9519 

Bibb County, GA.

Crawford County, GA.


cprice-sewell on PROD1PC64 with PROPOSALS3
Federal Register / Vol. 72, No. 88 / Tuesday, May 8, 2007 / Proposed Rules 26269 

TABLE 1.—PROPOSED INPATIENT REHABILITATION FACILITY WAGE INDEX FOR URBAN AREAS FOR DISCHARGES

OCCURRING FROM OCTOBER 1, 2007 THROUGH SEPTEMBER 30, 2008—Continued 

CBSA 

code Urban area (constituent counties) Wage index 

Jones County, GA.

Monroe County, GA.

Twiggs County, GA.

31460 ....... Madera, CA ............................................................................................................................................................................ 0.8154 

Madera County, CA.

31540 ....... Madison, WI ........................................................................................................................................................................... 1.0840 

Columbia County, WI.

Dane County, WI.

Iowa County, WI.

31700 ....... Manchester-Nashua, NH ....................................................................................................................................................... 1.0243 

Hillsborough County, NH.

Merrimack County, NH.

31900 ....... Mansfield, OH ........................................................................................................................................................................ 0.9271 

Richland County, OH.

32420 ....... Mayagu ̈ez, PR ....................................................................................................................................................................... 0.3848 

Hormigueros Municipio, PR.

Mayagu ̈ez Municipio, PR.

32580 ....... McAllen-Edinburg-Pharr, TX .................................................................................................................................................. 0.8773 

Hidalgo County, TX.

32780 ....... Medford, OR .......................................................................................................................................................................... 1.0818 

Jackson County, OR.

32820 ....... Memphis, TN-MS-AR ............................................................................................................................................................. 0.9373 

Crittenden County, AR.

DeSoto County, MS.

Marshall County, MS.

Tate County, MS.

Tunica County, MS.

Fayette County, TN.

Shelby County, TN.

Tipton County, TN.

32900 ....... Merced, CA ............................................................................................................................................................................ 1.1471 

Merced County, CA.

33124 ....... Miami-Miami Beach-Kendall, FL ............................................................................................................................................ 0.9812 

Miami-Dade County, FL.

33140 ....... Michigan City-La Porte, IN .................................................................................................................................................... 0.9118 

LaPorte County, IN.

33260 ....... Midland, TX ............................................................................................................................................................................ 0.9786 

Midland County, TX.

33340 ....... Milwaukee-Waukesha-West Allis, WI .................................................................................................................................... 1.0218 

Milwaukee County, WI.

Ozaukee County, WI.

Washington County, WI.

Waukesha County, WI.

33460 ....... Minneapolis-St. Paul-Bloomington, MN-WI ........................................................................................................................... 1.0946 

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.

33540 ....... Missoula, MT ......................................................................................................................................................................... 0.8928 

Missoula County, MT.

33660 ....... Mobile, AL .............................................................................................................................................................................. 0.7913 

Mobile County, AL.

33700 ....... Modesto, CA .......................................................................................................................................................................... 1.1729 

Stanislaus County, CA.

33740 ....... Monroe, LA ............................................................................................................................................................................ 0.7997 

Ouachita Parish, LA.

Union Parish, LA.

33780 ....... Monroe, MI ............................................................................................................................................................................. 0.9707 

Monroe County, MI.

33860 ....... Montgomery, AL .................................................................................................................................................................... 0.8009 

Autauga County, AL.


cprice-sewell on PROD1PC64 with PROPOSALS3
26270 Federal Register / Vol. 72, No. 88 / Tuesday, May 8, 2007 / Proposed Rules 

TABLE 1.—PROPOSED INPATIENT REHABILITATION FACILITY WAGE INDEX FOR URBAN AREAS FOR DISCHARGES

OCCURRING FROM OCTOBER 1, 2007 THROUGH SEPTEMBER 30, 2008—Continued 

CBSA 

code Urban area (constituent counties) Wage index 

Elmore County, AL.

Lowndes County, AL.

Montgomery County, AL.

34060 ....... Morgantown, WV ................................................................................................................................................................... 0.8423 

Monongalia County, WV.

Preston County, WV.

34100 ....... Morristown, TN ...................................................................................................................................................................... 0.7933 

Grainger County, TN.

Hamblen County, TN.

Jefferson County, TN.

34580 ....... Mount Vernon-Anacortes, WA ............................................................................................................................................... 1.0517 

Skagit County, WA.

34620 ....... Muncie, IN .............................................................................................................................................................................. 0.8562 

Delaware County, IN.

34740 ....... Muskegon-Norton Shores, MI ................................................................................................................................................ 0.9941 

Muskegon County, MI.

34820 ....... Myrtle Beach-Conway-North Myrtle Beach, SC .................................................................................................................... 0.8810 

Horry County, SC.

34900 ....... Napa, CA ............................................................................................................................................................................... 1.3374 

Napa County, CA.

34940 ....... Naples-Marco Island, FL ....................................................................................................................................................... 0.9941 

Collier County, FL.

34980 ....... Nashville-Davidson—Murfreesboro, TN ................................................................................................................................ 0.9847 

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.

35004 ....... Nassau-Suffolk, NY ............................................................................................................................................................... 1.2662 

Nassau County, NY.

Suffolk County, NY.

35084 ....... Newark-Union, NJ-PA ............................................................................................................................................................ 1.1892 

Essex County, NJ.

Hunterdon County, NJ.

Morris County, NJ.

Sussex County, NJ.

Union County, NJ.

Pike County, PA.

35300 ....... New Haven-Milford, CT ......................................................................................................................................................... 1.1953 

New Haven County, CT.

35380 ....... New Orleans-Metairie-Kenner, LA ......................................................................................................................................... 0.8831 

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.

35644 ....... New York-Wayne-White Plains, NY-NJ ................................................................................................................................. 1.3177 

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.

35660 ....... Niles-Benton Harbor, MI ........................................................................................................................................................ 0.8915 

Berrien County, MI.


cprice-sewell on PROD1PC64 with PROPOSALS3
Federal Register / Vol. 72, No. 88 / Tuesday, May 8, 2007 / Proposed Rules 26271 

TABLE 1.—PROPOSED INPATIENT REHABILITATION FACILITY WAGE INDEX FOR URBAN AREAS FOR DISCHARGES

OCCURRING FROM OCTOBER 1, 2007 THROUGH SEPTEMBER 30, 2008—Continued 

CBSA 

code Urban area (constituent counties) Wage index 

35980 ....... Norwich-New London, CT ..................................................................................................................................................... 1.1932 

New London County, CT.

36084 ....... Oakland-Fremont-Hayward, CA ............................................................................................................................................ 1.5819 

Alameda County, CA.

Contra Costa County, CA.

36100 ....... Ocala, FL ............................................................................................................................................................................... 0.8867 

Marion County, FL.

36140 ....... Ocean City, NJ ...................................................................................................................................................................... 1.0472 

Cape May County, NJ.

36220 ....... Odessa, TX ............................................................................................................................................................................ 1.0073 

Ector County, TX.

36260 ....... Ogden-Clearfield, UT ............................................................................................................................................................. 0.8995 

Davis County, UT.

Morgan County, UT.

Weber County, UT.

36420 ....... Oklahoma City, OK ................................................................................................................................................................ 0.8843 

Canadian County, OK.

Cleveland County, OK.

Grady County, OK.

Lincoln County, OK.

Logan County, OK.

McClain County, OK.

Oklahoma County, OK.

36500 ....... Olympia, WA .......................................................................................................................................................................... 1.1081 

Thurston County, WA.

36540 ....... Omaha-Council Bluffs, NE-IA ................................................................................................................................................ 0.9450 

Harrison County, IA.

Mills County, IA.

Pottawattamie County, IA.

Cass County, NE.

Douglas County, NE.

Sarpy County, NE.

Saunders County, NE.

Washington County, NE.

36740 ....... Orlando, FL ............................................................................................................................................................................ 0.9452 

Lake County, FL.

Orange County, FL.

Osceola County, FL.

Seminole County, FL.

36780 ....... Oshkosh-Neenah, WI ............................................................................................................................................................ 0.9315 

Winnebago County, WI.

36980 ....... Owensboro, KY ...................................................................................................................................................................... 0.8748 

Daviess County, KY.

Hancock County, KY.

McLean County, KY.

37100 ....... Oxnard-Thousand Oaks-Ventura, CA ................................................................................................................................... 1.1546 

Ventura County, CA.

37340 ....... Palm Bay-Melbourne-Titusville, FL ........................................................................................................................................ 0.9443 

Brevard County, FL.

37460 ....... Panama City-Lynn Haven, FL ............................................................................................................................................... 0.8027 

Bay County, FL.

37620 ....... Parkersburg-Marietta, WV-OH ............................................................................................................................................... 0.7977 

Washington County, OH.

Pleasants County, WV.

Wirt County, WV.

Wood County, WV.

37700 ....... Pascagoula, MS ..................................................................................................................................................................... 0.8215 

George County, MS.

Jackson County, MS.

37860 ....... Pensacola-Ferry Pass-Brent, FL ........................................................................................................................................... 0.8000 

Escambia County, FL.

Santa Rosa County, FL.

37900 ....... Peoria, IL ............................................................................................................................................................................... 0.8982 

Marshall County, IL.

Peoria County, IL.

Stark County, IL.

Tazewell County, IL.

Woodford County, IL.

37964 ....... Philadelphia, PA .................................................................................................................................................................... 1.0996 

Bucks County, PA.


cprice-sewell on PROD1PC64 with PROPOSALS3
26272 Federal Register / Vol. 72, No. 88 / Tuesday, May 8, 2007 / Proposed Rules 

TABLE 1.—PROPOSED INPATIENT REHABILITATION FACILITY WAGE INDEX FOR URBAN AREAS FOR DISCHARGES

OCCURRING FROM OCTOBER 1, 2007 THROUGH SEPTEMBER 30, 2008—Continued 

CBSA 

code Urban area (constituent counties) Wage index 

Chester County, PA.

Delaware County, PA.

Montgomery County, PA.

Philadelphia County, PA.

38060 ....... Phoenix-Mesa-Scottsdale, AZ ............................................................................................................................................... 1.0287 

Maricopa County, AZ.

Pinal County, AZ.

38220 ....... Pine Bluff, AR ........................................................................................................................................................................ 0.8383 

Cleveland County, AR.

Jefferson County, AR.

Lincoln County, AR.

38300 ....... Pittsburgh, PA ........................................................................................................................................................................ 0.8674 

Allegheny County, PA.

Armstrong County, PA.

Beaver County, PA.

Butler County, PA.

Fayette County, PA.

Washington County, PA.

Westmoreland County, PA.

38340 ....... Pittsfield, MA .......................................................................................................................................................................... 1.0266 

Berkshire County, MA.

38540 ....... Pocatello, ID .......................................................................................................................................................................... 0.9400 

Bannock County, ID.

Power County, ID.

38660 ....... Ponce, PR .............................................................................................................................................................................. 0.4842 

Juana Dı ́az Municipio, PR.

Ponce Municipio, PR.

Villalba Municipio, PR.

38860 ....... Portland-South Portland-Biddeford, ME ................................................................................................................................ 0.9908 

Cumberland County, ME.

Sagadahoc County, ME.

York County, ME.

38900 ....... Portland-Vancouver-Beaverton, OR-WA ............................................................................................................................... 1.1416 

Clackamas County, OR.

Columbia County, OR.

Multnomah County, OR.

Washington County, OR.

Yamhill County, OR.

Clark County, WA.

Skamania County, WA.

38940 ....... Port St. Lucie-Fort Pierce, FL ................................................................................................................................................ 0.9833 

Martin County, FL.

St. Lucie County, FL.

39100 ....... Poughkeepsie-Newburgh-Middletown, NY ............................................................................................................................ 1.0911 

Dutchess County, NY.

Orange County, NY.

39140 ....... Prescott, AZ ........................................................................................................................................................................... 0.9836 

Yavapai County, AZ.

39300 ....... Providence-New Bedford-Fall River, RI-MA .......................................................................................................................... 1.0783 

Bristol County, MA.

Bristol County, RI.

Kent County, RI.

Newport County, RI.

Providence County, RI.

Washington County, RI.

39340 ....... Provo-Orem, UT .................................................................................................................................................................... 0.9537 

Juab County, UT.

Utah County, UT.

39380 ....... Pueblo, CO ............................................................................................................................................................................ 0.8753 

Pueblo County, CO.

39460 ....... Punta Gorda, FL .................................................................................................................................................................... 0.9405 

Charlotte County, FL.

39540 ....... Racine, WI ............................................................................................................................................................................. 0.9356 

Racine County, WI.

39580 ....... Raleigh-Cary, NC ................................................................................................................................................................... 0.9864 

Franklin County, NC.

Johnston County, NC.

Wake County, NC.

39660 ....... Rapid City, SD ....................................................................................................................................................................... 0.8833 

Meade County, SD.


cprice-sewell on PROD1PC64 with PROPOSALS3
Federal Register / Vol. 72, No. 88 / Tuesday, May 8, 2007 / Proposed Rules 26273 

TABLE 1.—PROPOSED INPATIENT REHABILITATION FACILITY WAGE INDEX FOR URBAN AREAS FOR DISCHARGES

OCCURRING FROM OCTOBER 1, 2007 THROUGH SEPTEMBER 30, 2008—Continued 

CBSA 

code Urban area (constituent counties) Wage index 

Pennington County, SD.

39740 ....... Reading, PA ........................................................................................................................................................................... 0.9622 

Berks County, PA.

39820 ....... Redding, CA .......................................................................................................................................................................... 1.3198 

Shasta County, CA.

39900 ....... Reno-Sparks, NV ................................................................................................................................................................... 1.1963 

Storey County, NV.

Washoe County, NV.

40060 ....... Richmond, VA ........................................................................................................................................................................ 0.9177 

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.

40140 ....... Riverside-San Bernardino-Ontario, CA ................................................................................................................................. 1.0904 

Riverside County, CA.

San Bernardino County, CA.

40220 ....... Roanoke, VA .......................................................................................................................................................................... 0.8647 

Botetourt County, VA.

Craig County, VA.

Franklin County, VA.

Roanoke County, VA.

Roanoke City, VA.

Salem City, VA.

40340 ....... Rochester, MN ....................................................................................................................................................................... 1.1408 

Dodge County, MN.

Olmsted County, MN.

Wabasha County, MN.

40380 ....... Rochester, NY ....................................................................................................................................................................... 0.8994 

Livingston County, NY.

Monroe County, NY.

Ontario County, NY.

Orleans County, NY.

Wayne County, NY.

40420 ....... Rockford, IL ........................................................................................................................................................................... 0.9989 

Boone County, IL.

Winnebago County, IL.

40484 ....... Rockingham County-Strafford County, NH ........................................................................................................................... 1.0159 

Rockingham County, NH.

Strafford County, NH.

40580 ....... Rocky Mount, NC .................................................................................................................................................................. 0.8854 

Edgecombe County, NC.

Nash County, NC.

40660 ....... Rome, GA .............................................................................................................................................................................. 0.9193 

Floyd County, GA.

40900 ....... Sacramento—Arden-Arcade—Roseville, CA ........................................................................................................................ 1.3372 

El Dorado County, CA.

Placer County, CA.

Sacramento County, CA.

Yolo County, CA.

40980 ....... Saginaw-Saginaw Township North, MI ................................................................................................................................. 0.8874 

Saginaw County, MI.

41060 ....... St. Cloud, MN ........................................................................................................................................................................ 1.0362 

Benton County, MN.

Stearns County, MN.


cprice-sewell on PROD1PC64 with PROPOSALS3
26274 Federal Register / Vol. 72, No. 88 / Tuesday, May 8, 2007 / Proposed Rules 

TABLE 1.—PROPOSED INPATIENT REHABILITATION FACILITY WAGE INDEX FOR URBAN AREAS FOR DISCHARGES

OCCURRING FROM OCTOBER 1, 2007 THROUGH SEPTEMBER 30, 2008—Continued 

CBSA 

code Urban area (constituent counties) Wage index 

41100 ....... St. George, UT ...................................................................................................................................................................... 0.9265 

Washington County, UT.

41140 ....... St. Joseph, MO-KS ................................................................................................................................................................ 1.0118 

Doniphan County, KS.

Andrew County, MO.

Buchanan County, MO.

DeKalb County, MO.

41180 ....... St. Louis, MO-IL ..................................................................................................................................................................... 0.9005 

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.

41420 ....... Salem, OR ............................................................................................................................................................................. 1.0438 

Marion County, OR.

Polk County, OR.

41500 ....... Salinas, CA ............................................................................................................................................................................ 1.4337 

Monterey County, CA.

41540 ....... Salisbury, MD ........................................................................................................................................................................ 0.8953 

Somerset County, MD.

Wicomico County, MD.

41620 ....... Salt Lake City, UT ................................................................................................................................................................. 0.9402 

Salt Lake County, UT.

Summit County, UT.

Tooele County, UT.

41660 ....... San Angelo, TX ..................................................................................................................................................................... 0.8362 

Irion County, TX.

Tom Green County, TX.

41700 ....... San Antonio, TX .................................................................................................................................................................... 0.8844 

Atascosa County, TX.

Bandera County, TX.

Bexar County, TX.

Comal County, TX.

Guadalupe County, TX.

Kendall County, TX.

Medina County, TX.

Wilson County, TX.

41740 ....... San Diego-Carlsbad-San Marcos, CA ................................................................................................................................... 1.1354 

San Diego County, CA.

41780 ....... Sandusky, OH ........................................................................................................................................................................ 0.9302 

Erie County, OH.

41884 ....... San Francisco-San Mateo-Redwood City, CA ...................................................................................................................... 1.5165 

Marin County, CA.

San Francisco County, CA.

San Mateo County, CA.

41900 ....... San Germa ́n-Cabo Rojo, PR ................................................................................................................................................. 0.4885 

Cabo Rojo Municipio, PR.

Lajas Municipio, PR.

Sabana Grande Municipio, PR.

San Germa ́n Municipio, PR.

41940 ....... San Jose-Sunnyvale-Santa Clara, CA .................................................................................................................................. 1.5543 

San Benito County, CA.

Santa Clara County, CA.

41980 ....... San Juan-Caguas-Guaynabo, PR ......................................................................................................................................... 0.4452 

Aguas Buenas Municipio, PR.

Aibonito Municipio, PR.

Arecibo Municipio, PR.

Barceloneta Municipio, PR.


cprice-sewell on PROD1PC64 with PROPOSALS3
Federal Register / Vol. 72, No. 88 / Tuesday, May 8, 2007 / Proposed Rules 26275 

TABLE 1.—PROPOSED INPATIENT REHABILITATION FACILITY WAGE INDEX FOR URBAN AREAS FOR DISCHARGES

OCCURRING FROM OCTOBER 1, 2007 THROUGH SEPTEMBER 30, 2008—Continued 

CBSA 

code Urban area (constituent counties) Wage index 

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.

Comer ́ıo 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.

Lo ́ıza Municipio, PR.

Manat ́ı Municipio, PR.

Maunabo Municipio, PR.

Morovis Municipio, PR.

Naguabo Municipio, PR.

Naranjito Municipio, PR.

Orocovis Municipio, PR.

Quebradillas Municipio, PR.

R ́ıo 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.

42020 ....... San Luis Obispo-Paso Robles, CA ....................................................................................................................................... 1.1598 

San Luis Obispo County, CA.

42044 ....... Santa Ana-Anaheim-Irvine, CA ............................................................................................................................................. 1.1473 

Orange County, CA.

42060 ....... Santa Barbara-Santa Maria-Goleta, CA ................................................................................................................................ 1.1091 

Santa Barbara County, CA.

42100 ....... Santa Cruz-Watsonville, CA .................................................................................................................................................. 1.5457 

Santa Cruz County, CA.

42140 ....... Santa Fe, NM ........................................................................................................................................................................ 1.0824 

Santa Fe County, NM.

42220 ....... Santa Rosa-Petaluma, CA .................................................................................................................................................... 1.4464 

Sonoma County, CA.

42260 ....... Sarasota-Bradenton-Venice, FL ............................................................................................................................................ 0.9868 

Manatee County, FL.

Sarasota County, FL.

42340 ....... Savannah, GA ....................................................................................................................................................................... 0.9351 

Bryan County, GA.

Chatham County, GA.

Effingham County, GA.

42540 ....... Scranton—Wilkes-Barre, PA ................................................................................................................................................. 0.8347 

Lackawanna County, PA.

Luzerne County, PA.

Wyoming County, PA.

42644 ....... Seattle-Bellevue-Everett, WA ................................................................................................................................................ 1.1434 

King County, WA.

Snohomish County, WA.

42680 ....... Sebastian-Vero Beach, FL .................................................................................................................................................... 0.9573 

Indian River County, FL.

43100 ....... Sheboygan, WI ...................................................................................................................................................................... 0.9026 

Sheboygan County, WI.

43300 ....... Sherman-Denison, TX ........................................................................................................................................................... 0.8502 

Grayson County, TX.

43340 ....... Shreveport-Bossier City, LA .................................................................................................................................................. 0.8865 


cprice-sewell on PROD1PC64 with PROPOSALS3
26276 Federal Register / Vol. 72, No. 88 / Tuesday, May 8, 2007 / Proposed Rules 

TABLE 1.—PROPOSED INPATIENT REHABILITATION FACILITY WAGE INDEX FOR URBAN AREAS FOR DISCHARGES

OCCURRING FROM OCTOBER 1, 2007 THROUGH SEPTEMBER 30, 2008—Continued 

CBSA 

code Urban area (constituent counties) Wage index 

Bossier Parish, LA.

Caddo Parish, LA.

De Soto Parish, LA.

43580 ....... Sioux City, IA-NE-SD ............................................................................................................................................................. 0.9200 

Woodbury County, IA.

Dakota County, NE.

Dixon County, NE.

Union County, SD.

43620 ....... Sioux Falls, SD ...................................................................................................................................................................... 0.9559 

Lincoln County, SD.

McCook County, SD.

Minnehaha County, SD.

Turner County, SD.

43780 ....... South Bend-Mishawaka, IN-MI .............................................................................................................................................. 0.9842 

St. Joseph County, IN.

Cass County, MI.

43900 ....... Spartanburg, SC .................................................................................................................................................................... 0.9174 

Spartanburg County, SC.

44060 ....... Spokane, WA ......................................................................................................................................................................... 1.0447 

Spokane County, WA.

44100 ....... Springfield, IL ......................................................................................................................................................................... 0.8890 

Menard County, IL.

Sangamon County, IL.

44140 ....... Springfield, MA ...................................................................................................................................................................... 1.0079 

Franklin County, MA.

Hampden County, MA.

Hampshire County, MA.

44180 ....... Springfield, MO ...................................................................................................................................................................... 0.8469 

Christian County, MO.

Dallas County, MO.

Greene County, MO.

Polk County, MO.

Webster County, MO.

44220 ....... Springfield, OH ...................................................................................................................................................................... 0.8593 

Clark County, OH.

44300 ....... State College, PA .................................................................................................................................................................. 0.8784 

Centre County, PA.

44700 ....... Stockton, CA .......................................................................................................................................................................... 1.1442 

San Joaquin County, CA.

44940 ....... Sumter, SC ............................................................................................................................................................................ 0.8083 

Sumter County, SC.

45060 ....... Syracuse, NY ......................................................................................................................................................................... 0.9691 

Madison County, NY.

Onondaga County, NY.

Oswego County, NY.

45104 ....... Tacoma, WA .......................................................................................................................................................................... 1.0789 

Pierce County, WA.

45220 ....... Tallahassee, FL ..................................................................................................................................................................... 0.8942 

Gadsden County, FL.

Jefferson County, FL.

Leon County, FL.

Wakulla County, FL.

45300 ....... Tampa-St. Petersburg-Clearwater, FL .................................................................................................................................. 0.9144 

Hernando County, FL.

Hillsborough County, FL.

Pasco County, FL.

Pinellas County, FL.

45460 ....... Terre Haute, IN ...................................................................................................................................................................... 0.8765 

Clay County, IN.

Sullivan County, IN.

Vermillion County, IN.

Vigo County, IN.

45500 ....... Texarkana, TX-Texarkana, AR .............................................................................................................................................. 0.8104 

Miller County, AR.

Bowie County, TX.

45780 ....... Toledo, OH ............................................................................................................................................................................ 0.9586 

Fulton County, OH.

Lucas County, OH.

Ottawa County, OH.

Wood County, OH.


cprice-sewell on PROD1PC64 with PROPOSALS3
Federal Register / Vol. 72, No. 88 / Tuesday, May 8, 2007 / Proposed Rules 26277 

TABLE 1.—PROPOSED INPATIENT REHABILITATION FACILITY WAGE INDEX FOR URBAN AREAS FOR DISCHARGES

OCCURRING FROM OCTOBER 1, 2007 THROUGH SEPTEMBER 30, 2008—Continued 

CBSA 

code Urban area (constituent counties) Wage index 

45820 ....... Topeka, KS ............................................................................................................................................................................ 0.8730 

Jackson County, KS.

Jefferson County, KS.

Osage County, KS.

Shawnee County, KS.

Wabaunsee County, KS.

45940 ....... Trenton-Ewing, NJ ................................................................................................................................................................. 1.0835 

Mercer County, NJ.

46060 ....... Tucson, AZ ............................................................................................................................................................................ 0.9202 

Pima County, AZ.

46140 ....... Tulsa, OK ............................................................................................................................................................................... 0.8103 

Creek County, OK.

Okmulgee County, OK.

Osage County, OK.

Pawnee County, OK.

Rogers County, OK.

Tulsa County, OK.

Wagoner County, OK.

46220 ....... Tuscaloosa, AL ...................................................................................................................................................................... 0.8542 

Greene County, AL.

Hale County, AL.

Tuscaloosa County, AL.

46340 ....... Tyler, TX ................................................................................................................................................................................ 0.8811 

Smith County, TX.

46540 ....... Utica-Rome, NY ..................................................................................................................................................................... 0.8396 

Herkimer County, NY.

Oneida County, NY.

46660 ....... Valdosta, GA .......................................................................................................................................................................... 0.8369 

Brooks County, GA.

Echols County, GA.

Lanier County, GA.

Lowndes County, GA.

46700 ....... Vallejo-Fairfield, CA ............................................................................................................................................................... 1.5137 

Solano County, CA.

47020 ....... Victoria, TX ............................................................................................................................................................................ 0.8560 

Calhoun County, TX.

Goliad County, TX.

Victoria County, TX.

47220 ....... Vineland-Millville-Bridgeton, NJ ............................................................................................................................................. 0.9832 

Cumberland County, NJ.

47260 ....... Virginia Beach-Norfolk-Newport News, VA-NC ..................................................................................................................... 0.8790 

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.

47300 ....... Visalia-Porterville, CA ............................................................................................................................................................ 0.9968 

Tulare County, CA.

47380 ....... Waco, TX ............................................................................................................................................................................... 0.8633 

McLennan County, TX.

47580 ....... Warner Robins, GA ............................................................................................................................................................... 0.8380 

Houston County, GA.

47644 ....... Warren-Troy-Farmington Hills, MI ......................................................................................................................................... 1.0054 

Lapeer County, MI.

Livingston County, MI.

Macomb County, MI.

Oakland County, MI.

St. Clair County, MI.

47894 ....... Washington-Arlington-Alexandria, DC-VA-MD-WV ............................................................................................................... 1.1054 


cprice-sewell on PROD1PC64 with PROPOSALS3
26278 Federal Register / Vol. 72, No. 88 / Tuesday, May 8, 2007 / Proposed Rules 

TABLE 1.—PROPOSED INPATIENT REHABILITATION FACILITY WAGE INDEX FOR URBAN AREAS FOR DISCHARGES

OCCURRING FROM OCTOBER 1, 2007 THROUGH SEPTEMBER 30, 2008—Continued 

CBSA 

code Urban area (constituent counties) Wage index 

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.

47940 ....... Waterloo-Cedar Falls, IA ....................................................................................................................................................... 0.8408 

Black Hawk County, IA.

Bremer County, IA.

Grundy County, IA.

48140 ....... Wausau, WI ........................................................................................................................................................................... 0.9722 

Marathon County, WI.

48260 ....... Weirton-Steubenville, WV-OH ............................................................................................................................................... 0.8063 

Jefferson County, OH.

Brooke County, WV.

Hancock County, WV.

48300 ....... Wenatchee, WA ..................................................................................................................................................................... 1.0346 

Chelan County, WA.

Douglas County, WA.

48424 ....... West Palm Beach-Boca Raton-Boynton Beach, FL .............................................................................................................. 0.9649 

Palm Beach County, FL.

48540 ....... Wheeling, WV-OH ................................................................................................................................................................. 0.7010 

Belmont County, OH.

Marshall County, WV.

Ohio County, WV.

48620 ....... Wichita, KS ............................................................................................................................................................................ 0.9063 

Butler County, KS.

Harvey County, KS.

Sedgwick County, KS.

Sumner County, KS.

48660 ....... Wichita Falls, TX .................................................................................................................................................................... 0.8311 

Archer County, TX.

Clay County, TX.

Wichita County, TX.

48700 ....... Williamsport, PA .................................................................................................................................................................... 0.8139 

Lycoming County, PA.

48864 ....... Wilmington, DE-MD-NJ .......................................................................................................................................................... 1.0684 

New Castle County, DE.

Cecil County, MD.

Salem County, NJ.

48900 ....... Wilmington, NC ...................................................................................................................................................................... 0.9835 

Brunswick County, NC.

New Hanover County, NC.

Pender County, NC.

49020 ....... Winchester, VA-WV ............................................................................................................................................................... 1.0091 

Frederick County, VA.

Winchester City, VA.

Hampshire County, WV.

49180 ....... Winston-Salem, NC ............................................................................................................................................................... 0.9276 

Davie County, NC.

Forsyth County, NC.

Stokes County, NC.

Yadkin County, NC.

49340 ....... Worcester, MA ....................................................................................................................................................................... 1.0722 

Worcester County, MA.

49420 ....... Yakima, WA ........................................................................................................................................................................... 0.9847 


cprice-sewell on PROD1PC64 with PROPOSALS3
Federal Register / Vol. 72, No. 88 / Tuesday, May 8, 2007 / Proposed Rules 26279 

TABLE 1.—PROPOSED INPATIENT REHABILITATION FACILITY WAGE INDEX FOR URBAN AREAS FOR DISCHARGES

OCCURRING FROM OCTOBER 1, 2007 THROUGH SEPTEMBER 30, 2008—Continued 

CBSA 

code Urban area (constituent counties) Wage index 

Yakima County, WA.

49500 ....... Yauco, PR .............................................................................................................................................................................. 0.3854 

Gua ́nica Municipio, PR.

Guayanilla Municipio, PR.

Pen ̃uelas Municipio, PR.

Yauco Municipio, PR.

49620 ....... York-Hanover, PA .................................................................................................................................................................. 0.9397 

York County, PA.

49660 ....... Youngstown-Warren-Boardman, OH-PA ............................................................................................................................... 0.8802 

Mahoning County, OH.

Trumbull County, OH.

Mercer County, PA.

49700 ....... Yuba City, CA ........................................................................................................................................................................ 1.0730 

Sutter County, CA.

Yuba County, CA.

49740 ....... Yuma, AZ ............................................................................................................................................................................... 0.9109 

Yuma County, AZ.

1At this time, there are no hospitals located in this CBSA-based urban area on which to base a wage index. Therefore, the wage index value 

is based on the methodology described in the August 15, 2005 final rule (70 FR 47880). The wage index value for this area is the average wage 

index for all urban areas within the state. 

TABLE 2.—PROPOSED INPATIENT REHABILITATION FACILITY WAGE INDEX

FOR RURAL AREAS FOR DISCHARGES OCCURRING FROM OCTOBER 1, 2007 THROUGH SEPTEMBER

30, 2008 

CBSA 

code Nonurban area Wage index 

01 ............. Alabama .................. 0.7591 

02 ............. Alaska ..................... 1.0661 

03 ............. Arizona .................... 0.8908 

04 ............. Arkansas ................. 0.7307 

05 ............. California ................. 1.1454 

06 ............. Colorado ................. 0.9325 

07 ............. Connecticut ............. 1.1709 

08 ............. Delaware ................. 0.9705 

10 ............. Florida ..................... 0.8594 

11 ............. Georgia ................... 0.7593 

12 ............. Hawaii ..................... 1.0448 

13 ............. Idaho ....................... 0.8120 

14 ............. Illinois ...................... 0.8320 

15 ............. Indiana .................... 0.8538 

16 ............. Iowa ........................ 0.8681 

17 ............. Kansas .................... 0.7998 

18 ............. Kentucky ................. 0.7768 

19 ............. Louisiana ................ 0.7438 

20 ............. Maine ...................... 0.8443 

21 ............. Maryland ................. 0.8926 

22 ............. Massachusetts 2 ...... 1.1661 

23 ............. Michigan ................. 0.9062 

24 ............. Minnesota ............... 0.9153 

25 ............. Mississippi .............. 0.7738 

26 ............. Missouri .................. 0.7927 

TABLE 2.—PROPOSED INPATIENT REHABILITATION FACILITY WAGE INDEX

FOR RURAL AREAS FOR DISCHARGES OCCURRING FROM OCTOBER 1, 2007 THROUGH SEPTEMBER

30, 2008—Continued 

CBSA 

code Nonurban area Wage index 

27 ............. Montana .................. 0.8590 

28 ............. Nebraska ................ 0.8677 

29 ............. Nevada ................... 0.8944 

30 ............. New Hampshire ...... 1.0853 

31 ............. New Jersey 1 ........... ................

32 ............. New Mexico ............ 0.8332 

33 ............. New York ................ 0.8232 

34 ............. North Carolina ........ 0.8588 

35 ............. North Dakota .......... 0.7215 

36 ............. Ohio ........................ 0.8658 

37 ............. Oklahoma ............... 0.7629 

38 ............. Oregon .................... 0.9753 

39 ............. Pennsylvania .......... 0.8320 

40 ............. Puerto Rico 3 ........... 0.4047 

41 ............. Rhode Island 1 ........ ................

42 ............. South Carolina ........ 0.8566 

43 ............. South Dakota .......... 0.8480 

44 ............. Tennessee .............. 0.7827 

45 ............. Texas ...................... 0.7965 

46 ............. Utah ........................ 0.8140 

47 ............. Vermont .................. 0.9744 

48 ............. Virgin Islands .......... 0.8467 

49 ............. Virginia .................... 0.7940 

50 ............. Washington ............. 1.0263 

TABLE 2.—PROPOSED INPATIENT REHABILITATION FACILITY WAGE INDEX

FOR RURAL AREAS FOR DISCHARGES OCCURRING FROM OCTOBER 1, 2007 THROUGH SEPTEMBER

30, 2008—Continued 

CBSA 

code Nonurban area Wage index 

51 ............. West Virginia .......... 0.7607 

52 ............. Wisconsin ............... 0.9553 

53 ............. Wyoming ................. 0.9295 

65 ............. Guam ...................... 0.9611 

1All counties within the State are classified 

as urban. 2 Massachusetts has areas designated as 

rural; however, no short-term, acute care hospitals are located in the area(s) for FY 2008. 

As discussed in the preamble in Section IV.B, 

we are proposing to impute a wage index 

value for rural Massachusettes based on the 

average wage index from all contiguous 

CBSAs. 3Puerto Rico has areas designated as rural; 

however, no short-term, acute care hospitals 

are located in the area(s) for FY 2008. As discussed in the preamble in Section IV.B, we 

are proposing to continue to use the most recent wage index previously available for Puerto Rico as discussed in the FY 2006 IRF PPS 

final rule (70 FR 47880). 

[FR Doc. 07–2241 Filed 5–2–07; 8:45 am] 

BILLING CODE 4120–01–P 


cprice-sewell on PROD1PC64 with PROPOSALS3