Wednesday,

June 2, 2004

Part IV

Department of 

Health and Human 

Services

Centers for Medicare & Medicaid Services 

42 CFR Part 484

Medicare Program; Home Health 

Prospective Payment System Rate Update 

for Calendar Year 2005; Proposed Rule

31248 Federal Register / Vol. 69, No. 106 / Wednesday, June 2, 2004 / Proposed Rules 

DEPARTMENT OF HEALTH AND 

HUMAN SERVICES 

Centers for Medicare & Medicaid 

Services 

42 CFR Part 484 

[CMS–1265–P] 

RIN 0938–AM93 

Medicare Program; Home Health 

Prospective Payment System Rate 

Update for Calendar Year 2005

AGENCY: Centers for Medicare & 

Medicaid Services (CMS), HHS.

ACTION: Proposed rule.

SUMMARY: This proposed rule would set 

forth an update to the 60-day national 

episode rates and the national per-visit 

amounts under the Medicare 

prospective payment system for home 

health agencies. As part of this proposed 

rule, we also are proposing to rebase 

and revise the home health market 

basket to ensure it continues to 

adequately reflect the price changes of 

efficiently providing home health 

services. In addition, we are proposing 

to revise the fixed dollar loss ratio, 

which is used in the calculation of 

outlier payments. This proposed rule 

would be the first update of the home 

health prospective payment system (HH 

PPS) rates on a calendar year update 

cycle. HH PPS was moved to a calendar 

year update cycle as a result the 

provisions of the Medicare Prescription 

Drug, Improvement, and Modernization 

Act of 2003.

DATE: To be assured of consideration, 

comments must be received at one of 

the addresses provided below, no later 

than 5 p.m. on August 2, 2004.

ADDRESSES: In commenting, please refer 

to file code CMS–1265–P. Because of 

staff and resource limitations, we cannot 

accept comments by facsimile (FAX) 

transmission. 

Submit electronic comments to http:/

/www.cms.hhs.gov/regulations/

ecomments or to http://

www.regulations.gov. 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–1265–

P, P.O. Box 8016, Baltimore, MD 21244–

8016. 

Please allow sufficient time for mailed 

comments to be timely received in the 

event of delivery delays. 

If you prefer, you may deliver (by 

hand or courier) your written comments 

(one original and three copies) to one of 

the following addresses: 

Room 443–G, Hubert H. Humphrey 

Building, 200 Independence Avenue, 

SW., Washington, DC 20201, or Room 

C5–14–03, 7500 Security Boulevard, 

Baltimore, MD 21244–1850. 

Comments mailed to the addresses 

indicated as appropriate for hand or 

courier delivery may be delayed and 

could be considered late. 

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. After the close 

of the comment period, CMS posts all 

electronic comments received before the 

close of the comment period on its 

public Web site. 

For information on viewing public 

comments, see the beginning of the 

SUPPLEMENTARY INFORMATION section.

FOR FURTHER INFORMATION CONTACT: 

Randy Throndset, (410) 786–0131. 

Debra Gillespie, (410) 786–4631. 

Mary Lee Seifert (Market Basket), 

(410) 786–0030. 

Mollie Knight (Market Basket), (410) 

786–7948.

SUPPLEMENTARY INFORMATION: 

Inspection of Public Comments:

Comments received timely will 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 (410) 786–7195. 

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I. Background 

(If you choose to comment on issues 

in this section, please include the 

caption Background at the beginning of 

your comments.) 

A. Statutory Background 

The Balanced Budget Act of 1997 

(BBA), Pub. L. 105–33, enacted on 

August 5, 1997, significantly changed 

the way Medicare pays for Medicare 

home health services. Until the 

implementation of a home health 

prospective payment system (HH PPS) 

on October 1, 2000, home health 

agencies (HHAs) received payment 

under a cost-based reimbursement 

system. Section 4603 of the BBA 

governed the development of the HH 

PPS. 

Section 4603(a) of the BBA provides 

the authority for the development of a 

PPS for all Medicare-covered home 

health services provided under a plan of 

care that were paid on a reasonable cost 

basis by adding section 1895, entitled 

‘‘Prospective Payment For Home Health 

Services,’’ to the Social Security Act 

(the Act). 

Section 1895(b)(1) of the Act requires 

the Secretary to establish a PPS for all 

costs of home health services paid 

under Medicare. 

Section 1895(b)(3)(A) of the Act 

requires that (1) the computation of a 

standard prospective payment amount 

include all costs of home health services 

covered and paid for on a reasonable 

cost basis and be initially based on the 

most recent audited cost report data 

available to the Secretary, and (2) the 

prospective payment amounts be 

standardized to eliminate the effects of 

case-mix and wage levels among HHAs. 

Section 1895(b)(3)(B) of the Act 

addresses the annual update to the 

standard prospective payment amounts 

by the home health applicable increase 

percentage as specified in the statute. 

Section 1895(b)(4) of the Act governs 

the payment computation. Sections 

1895(b)(4)(A)(i) and (b)(4)(A)(ii) of the 

Act require the standard prospective 

payment amount to be adjusted for casemix and geographic differences in wage 

levels. Section 1895(b)(4)(B) of the Act 

requires the establishment of an 

appropriate case-mix adjustment factor 

that explains a significant amount of the 

variation in cost among different units 

of services. Similarly, section 

1895(b)(4)(C) of the Act requires the 

establishment of wage adjustment 

factors that reflect the relative level of 

wages and wage-related costs applicable 

Federal Register / Vol. 69, No. 106 / Wednesday, June 2, 2004 / Proposed Rules 31249

to the furnishing of home health 

services in a geographic area compared 

to the national average applicable level. 

These wage-adjustment factors may be 

the factors used by the Secretary for the 

different area wage levels for purposes 

of section 1886(d)(3)(E) of the Act. 

Section 1895(b)(5) of the Act gives the 

Secretary the option to grant additions 

or adjustments to the payment amount 

otherwise made in the case of outliers 

because of unusual variations in the 

type or amount of medically necessary 

care. Total outlier payments in a given 

fiscal year cannot exceed 5 percent of 

total payments projected or estimated. 

B. Updates 

On July 3, 2000, we published a final 

rule (65 FR 41128) in the Federal 

Register to implement the HH PPS 

legislation. That final rule established 

requirements for the new PPS for HHAs 

as required by section 4603 of the BBA, 

and as subsequently amended by 

section 5101 of the Omnibus 

Consolidated and Emergency 

Supplemental Appropriations Act 

(OCESAA) for Fiscal Year 1999, Public 

Law 105–277, enacted on October 21, 

1998; and by sections 302, 305, and 306 

of the Medicare, Medicaid, and SCHIP 

Balanced Budget Refinement Act 

(BBRA) of 1999, Public Law 106–113, 

enacted on November 29, 1999. The 

requirements include the 

implementation of a PPS for HHAs, 

consolidated billing requirements, and a 

number of other related changes. The 

PPS described in that rule replaced the 

retrospective reasonable-cost-based 

system that was used by Medicare for 

the payment of home health services 

under Part A and Part B. 

As required by section 1895(b)(3)(B) 

of the Act, we have updated the HH PPS 

rates annually in a separate Federal 

Register document. We will respond to 

public comments received on the FY 

2004 update notice (68 FR 39764) 

published on July 2, 2003 in the CY 

2005 final rule. 

C. System for Payment of Home Health 

Services 

Generally, Medicare makes payment 

under the HH PPS on the basis of a 

national standardized 60-day episode 

payment, adjusted for case mix and 

wage index. For episodes with four or 

fewer visits, Medicare pays on the basis 

of a national per-visit amount by 

discipline, referred to as a low 

utilization payment adjustment (LUPA). 

Medicare also adjusts the 60-day 

episode payment for certain intervening 

events that give rise to a partial episode 

payment adjustment (PEP adjustment) 

or a significant change in condition 

adjustment (SCIC). For certain cases that 

exceed a specific cost threshold, an 

outlier adjustment may also be 

available. For a complete and full 

description of the HH PPS as required 

by the BBA and as amended by 

OCESAA and BBRA, see the July 3, 

2000 HH PPS final rule (65 FR 41128). 

D. Medicare Prescription Drug, 

Improvement, and Modernization Act of 

2003

On December 8, 2003, the Congress 

enacted the Medicare Prescription Drug, 

Improvement, and Modernization Act 

(MMA) of 2003 (Pub. L. 108–173). This 

new legislation affects our proposed 

update to HH payment rates. 

Specifically, section 421 of MMA 

requires, for home health services 

furnished in a rural area (as defined in 

section 1886(d)(2)(D) of the Act), with 

respect to episodes or visits ending on 

or after April 1, 2004 and before April 

1, 2005, that the Secretary increase the 

payment amount that otherwise would 

have been made under section 1895 of 

the Act for the services by 5 percent. 

The statute waives budget neutrality 

for the purposes of this increase as it 

specifically states that the Secretary will 

not reduce the standard prospective 

payment amount (or amounts) under 

section 1895 of the Act applicable to 

home health services furnished during a 

period to offset the increase in payments 

resulting in the application of this 

section of the statute. 

Section 701 of the MMA changes the 

yearly update cycle of the HH PPS rates 

from that of a fiscal year to a calendar 

year update cycle for 2004 and any 

subsequent year. Generally, section 

701(a) of the MMA changes the 

references in the statute to refer to the 

calendar year for 2004 and any 

subsequent year. The changes result in 

updates to the HH PPS rates described 

as ‘‘fiscal year’’ updates for 2002 and 

2003 and as calendar ‘‘year’’ updates for 

2004 and any subsequent year (section 

1895(b)(3)(B)(i) of the Act). In light of 

these provisions, we will not be 

updating the HH PPS rates on October 

1, 2004 as HH PPS will now be updated 

on a calendar year update cycle. 

In addition to changing the update 

cycle for HH PPS rates, section 701 of 

the MMA makes adjustments to the 

home health applicable increase 

percentage for 2004, 2005, and 2006. 

Specifically, section 701(a)(2)(D) of the 

MMA leaves unchanged the home 

health market basket increase for the 

last calendar year quarter of 2003 and 

the first calendar year quarter of 2004 

(section 1895(b)(3)(B)(ii)(II) of the Act). 

Furthermore, section 701(b)(4) of the 

MMA sets the home health applicable 

percentage increase for the last 3 

quarters of 2004 as the home health 

market basket (3.3 percent) minus 0.8 

percentage point (section 

1895(b)(3)(B)(ii)(III) of the Act). We 

implemented this provision through 

Pub. 100–20, One Time Notification, 

Transmittal 59, issued February 20, 

2004. Section 701(b)(4) of the MMA also 

provides that updates for CY 2005 and 

CY 2006 will equal the applicable home 

health market basket percentage 

increase minus 0.8 percentage point. 

Lastly, section 701(b)(3) of the MMA 

revises the statute to provide that HH 

PPS rates for CY 2007 and any 

subsequent year will be updated by that 

year’s home health market basket 

percentage increase (section 

1895(b)(3)(B)(ii)(IV) of the Act). 

II. Provisions of the Proposed 

Regulations 

(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.) 

A. National Standardized 60-Day 

Episode Rate 

Medicare HH PPS has been effective 

since October 1, 2000. As set forth in the 

final rule published July 3, 2000 in the 

Federal Register (65 FR 41128), the unit 

of payment under Medicare HH PPS is 

a national standardized 60-day episode 

rate. As set forth in 42 CFR 484.220, we 

adjust the national standardized 60-day 

episode rate by a case mix grouping and 

a wage index value based on the site of 

service for the beneficiary. The 

proposed CY 2005 HH PPS rates use the 

same case-mix methodology and 

application of the wage index 

adjustment to the labor portion of the 

HH PPS rates as set forth in the July 3, 

2000 final rule. We multiply the 

national 60-day episode rate by the 

patient’s applicable case-mix weight. 

We divide the case-mix adjusted 

amount into a labor and non-labor 

portion. We multiply the labor portion 

by the applicable wage index based on 

the site of service of the beneficiary.

As required by section 1895(b)(3)(B) 

of the Act, we have updated the HH PPS 

rates annually in a separate Federal 

Register document. Section 484.225 sets 

forth the specific percentage update for 

fiscal years 2001, 2002, and 2003. To 

reflect the new statutory provisions 

enacted by section 701 of the MMA, in 

§ 484.225, we are proposing to 

redesignate paragraph (d) as paragraph 

(g) and revising it to read as follows: 

(g) For 2007 and subsequent calendar 

years, the unadjusted national rate is 

equal to the rate for the previous 

31250 Federal Register / Vol. 69, No. 106 / Wednesday, June 2, 2004 / Proposed Rules 

calendar year increased by the 

applicable home health market basket 

index amount. 

We are proposing to add new 

paragraphs (d), (e), and (f) to read as 

follows: 

(d) For the last calendar quarter of 

2003 and the first calendar quarter of 

2004, the unadjusted national 

prospective 60-day episode payment 

rate is equal to the rate from the 

previous fiscal year (FY 2003) increased 

by the applicable home health market 

basket index amount. 

(e) For the last 3 calendar quarters of 

2004, the unadjusted national 

prospective 60-day episode payment 

rate is equal to the rate from the 

previous fiscal year (FY 2003) increased 

by the applicable home health market 

basket minus 0.8 percentage point. 

(f) For each of calendar years 2005 

and 2006, the unadjusted national 

prospective 60-day episode payment 

rate is equal to the rate from the 

previous calendar year, increased by the 

applicable home health market basket 

minus 0.8 percentage point. 

As described in section II.B.2 of this 

proposed rule, we are proposing to 

rebase and revise the home health 

market basket. As proposed, the labor 

related portion of the rebased and 

revised home health market basket 

would be 76.775 percent, and the nonlabor portion would be 23.225 percent. 

We add the wage-adjusted portion to the 

non-labor portion yielding the case-mix 

and wage-adjusted 60-day episode rate 

subject to applicable adjustments. 

For CY 2005, we are proposing to use 

again the design and case-mix 

methodology described in section III.G 

of the HH PPS July 3, 2000 final rule (65 

FR 41192 through 41203). For CY 2005, 

we are proposing to base the wage index 

adjustment to the labor portion of the 

PPS rates on the most recent pre-floor 

and pre-reclassified hospital wage index 

as discussed in section III.C of this 

proposed rule. 

As discussed in the July 3, 2000 HH 

PPS final rule, for episodes with four or 

fewer visits, Medicare pays the national 

per-visit amount by discipline, referred 

to as a LUPA. We update the national 

per-visit amounts by discipline annually 

by the applicable home health market 

basket percentage. We adjust the 

national per-visit amount by the 

appropriate wage index based on the 

site of service for the beneficiary as set 

forth in § 484.230. We propose to adjust 

the labor portion of the updated 

national per-visit amounts by discipline 

used to calculate the LUPA by the most 

recent pre-floor and pre-reclassified 

hospital wage index, as discussed in 

section III.C of this proposed rule. 

Medicare pays the 60-day case-mix 

and wage-adjusted episode payment on 

a split percentage payment approach. 

The split percentage payment approach 

includes an initial percentage payment 

and a final percentage payment as set 

forth in § 484.205(b)(1) and (b)(2). We 

may base the initial percentage payment 

on the submission of a request for 

anticipated payment and the final 

percentage payment on the submission 

of the claim for the episode, as 

discussed in § 409.43. The claim for the 

episode that the HHA submits for the 

final percentage payment determines 

the total payment amount for the 

episode and whether we make an 

applicable adjustment to the 60-day 

case-mix and wage-adjusted episode 

payment. The end date of the 60-day 

episode as reported on the claim 

determines the rate level at which 

Medicare will pay the claim for the 

fiscal period.

We may also adjust the 60-day casemix and wage-adjusted episode 

payment based on the information 

submitted on the claim to reflect the 

following: 

• A low utilization payment provided 

on a per-visit basis as set forth in 

§ 484.205(c) and § 484.230. 

• A partial episode payment 

adjustment as set forth in § 484.205(d) 

and § 484.235. 

• A significant change in condition 

adjustment as set forth in § 484.205(e) 

and § 484.237. 

• An outlier payment as set forth in 

§ 484.205(f) and § 484.240. 

This proposed rule would reflect the 

updated CY 2005 rates that would be 

effective January 1, 2005. 

B. Rebasing and Revising of the Home 

Health Market Basket 

1. Background 

For CY 2005, section 1895(b)(3)(B) of 

the Act, as amended by MMA, requires 

the standard prospective payment 

amounts to be adjusted by a factor equal 

to the applicable home health market 

basket increase minus 0.8 percentage 

point. 

Effective for cost reporting periods 

beginning on or after July 1, 1980, we 

developed and adopted an HHA input 

price index (that is, the home health 

‘‘market basket’’). Although ‘‘market 

basket’’ technically describes the mix of 

goods and services used to produce 

home health care, this term is also 

commonly used to denote the input 

price index derived from that market 

basket. Accordingly, the term ‘‘home 

health market basket’’ used in this 

document refers to the HHA input price 

index. 

The percentage change in the home 

health market basket reflects the average 

change in the price of goods and 

services purchased by HHAs in 

providing an efficient level of home 

health care services. We first used the 

home health market basket to adjust 

HHA cost limits by an amount that 

reflected the average increase in the 

prices of the goods and services used to 

furnish reasonable cost home health 

care. This approach linked the increase 

in the cost limits to the efficient 

utilization of resources. For a greater 

discussion on the home health market 

basket, see the notice with comment 

period published in the Federal 

Register on February 15, 1980 (45 FR 

10450, 10451), notice with comment 

period published in the Federal 

Register on February 14, 1995 (60 FR 

8389, 8392), and notice with comment 

period published in Federal Register on 

July 1, 1996 (61 FR 34344, 34347). 

Beginning with FY 2002, we used the 

home health market basket to update 

payments under the home health PPS. 

The home health market basket is a 

fixed-weight Laspeyres-type price 

index; its weights reflect the cost 

distribution for the base year while 

current period price changes are 

measured. The home health market 

basket is constructed in three steps. 

First, a base period is selected and total 

base period expenditures are estimated 

for mutually exclusive and exhaustive 

spending categories based upon type of 

expenditure. Then the proportion of 

total costs that each spending category 

represents is determined. These 

proportions are called cost or 

expenditure weights. 

The second step essential for 

developing an input price index is to 

match each expenditure category to an 

appropriate price/wage variable, called 

a price proxy. These proxy variables are 

drawn from publicly available statistical 

series published on a consistent 

schedule, preferably at least quarterly. 

In the third and final step, the price 

level for each spending category is 

multiplied by the expenditure weight 

for that category. The sum of these 

products for all cost categories yields 

the composite index level in the market 

basket in a given year. Repeating the 

third step for other years will produce 

a time series of market basket index 

levels. Dividing one index level by an 

earlier index level will produce rates of 

growth in the input price index.

We described the market basket as a 

fixed-weight index because it answers 

the question of how much more or less 

it would cost, at a later time, to 

purchase the same mix of goods and 

services that was purchased in the base 

Federal Register / Vol. 69, No. 106 / Wednesday, June 2, 2004 / Proposed Rules 31251

period. As such, it measures ‘‘pure’’

price changes only. The effects on total 

expenditures resulting from changes in 

the quantity or mix of goods and 

services purchased subsequent to the 

base period are, by design, not 

considered. 

2. Rebasing and Revising the Home 

Health Market Basket 

We believe that it is desirable to 

rebase the home health market basket 

periodically so the cost category weights 

reflect changes in the mix of goods and 

services that HHAs purchase in 

furnishing home health care. We based 

the cost category weights in the current 

home health market basket on FY 1993 

data. We are proposing to rebase and 

revise the home health market basket to 

reflect FY 2000 Medicare cost report 

data, the latest available, thorough data 

on the structure of HHA costs. 

The terms ‘‘rebasing’’ and ‘‘revising,’’

while often used interchangeably, 

actually denote different activities. 

Rebasing is the term used to define 

moving the base year for the structure of 

costs of an input price index (that is, in 

this rule, we are proposing to move the 

base year cost structure from FY 1993 to 

FY 2000). Revising is the term used to 

define changing data sources, cost 

categories, and/or price proxies used in 

the input price index. 

For this proposed revising and 

rebasing, we modified several categories 

in the market basket cost structure. The 

major revision to the proposed revised 

and rebased market basket was the 

combining of the Administrative and 

General and Other Expenses cost 

categories. The proposed revised 

Administrative and General and Other 

Expenses cost category was 

disaggregated further into five separate 

cost categories (Telephone, Postage, 

Professional Fees, Other Products, and 

Other Services). The Paper and Printing 

cost category, which was broken out in 

the 1993-based market basket, is 

included in the proposed Other 

Products cost category. 

With the exception of the price 

proxies for the proposed modified cost 

categories in the Administrative and 

General and Other cost category, we 

propose no further changes to any of the 

price proxies. 

For this proposed rebased and revised 

market basket, we reviewed HHA 

expenditure data for the market basket 

cost categories. For each freestanding 

HHA, we reviewed Medicare cost 

reports whose cost reporting period 

began on or after October 1, 1999 and 

before October 1, 2000. We maintained 

our policy of using data from 

freestanding HHAs because they reflect 

the actual cost structure faced by HHAs. 

Expense data for a hospital-based HHA 

are affected by the allocation of 

overhead costs over the entire 

institution (including but not limited to 

hospital, hospital-based skilled nursing 

facility, hospital-based HHA). Due to the 

method of allocation, total expenses will 

be correct, but the individual 

components’ expenses may be skewed. 

Therefore, if data from hospital-based 

HHAs were included, the resultant cost 

structure could be unrepresentative of 

the costs facing an average HHA.

Data on HHA expenditures for nine 

major expense categories (wages and 

salaries, employee benefits, 

transportation, operation and 

maintenance, administrative and 

general, insurance, fixed capital, 

movable capital, and a residual ‘‘all 

other’’) were tabulated from the FY 2000 

Medicare HHA cost reports. Since 

prescription drugs and durable medical 

equipment are not payable under the 

HH PPS, we excluded those items from 

the home health market basket. 

Expenditures for contract services were 

also tabulated from these FY 2000 

Medicare HHA cost reports. After totals 

for these major cost categories were 

edited to remove reports where the data 

were deemed unreasonable (for 

example, when total costs were not 

greater than zero), we then determined 

the proportion of total costs that each 

category represents. The proportions 

represent the major rebased home health 

market basket weights. 

We determined the weights for 

subcategories (Telephone, Postage, 

Professional Fees, Other Products, and 

Other Services) within the combined 

Administrative and General and Other 

Expenses using the latest available 

(1997 benchmark) U.S. Department of 

Commerce, Bureau of Economic 

Analysis (BEA) Input-Output Table, 

from which we extracted data for HHAs. 

The BEA Input-Output table, which is 

updated at 5-year intervals, was most 

recently described in the Survey of 

Current Business article, ‘‘Benchmark 

Input-Output Accounts of the U.S., 

1997’’ (December 2002). These data 

were aged from 1997 to 2000 using 

relevant price changes. 

This work resulted in the 

identification of 12 separate cost 

categories, the same number found in 

the 1993-based home health market 

basket. The differences between the 

major categories for the proposed 2000-

based index and those used for the 

current 1993-based index are 

summarized in Table 1. We have 

allocated the Contracted Services weight 

to the Wages and Salaries, Employee 

Benefits, and Administrative and 

General and Other Expenses cost 

categories in the proposed 2000-based 

index as we did in the 1993-based 

index.

TABLE 1.—COMPARISON OF 1993 AND PROPOSED 2000-BASED HOME HEALTH MARKET BASKET MAJOR COST

CATEGORIES AND WEIGHTS

Cost categories 

1993-Based home 

health

market basket 

Proposed 2000-

based home 

health

market basket 

Wages and Salaries, including allocated contract services’ labor .............................................................. 64.226 65.766

Employee Benefits, including allocated contract services’ labor ................................................................ 13.442 11.009

All Other Expenses including allocated contract services’ labor ................................................................ 22.332 23.225

Total ...................................................................................................................................................... 100.000 100.000

The complete proposed 2000-based 

cost categories and weights are listed in 

Table 2.

31252 Federal Register / Vol. 69, No. 106 / Wednesday, June 2, 2004 / Proposed Rules 

TABLE 2.—COST CATEGORIES, WEIGHTS, AND PRICE PROXIES IN PROPOSED 2000-BASED HOME HEALTH MARKET

BASKET

Cost categories Weight Price proxy 

Compensation, including allocated contract services’ labor ......... 76.775

Wages and Salaries, including allocated contract services’

labor.

65.766 Proposed Home Health Occupational Wage Index. 

Employee Benefits, including allocated contract services’

labor.

11.009 Proposed Home Health Occupational Benefits Index. 

Operations & Maintenance ........................................................... 0.825 CPI Fuel & Other Utilities. 

Administrative & General & Other Expenses including allocated 

contract services’ labor*.

16.633

Telephone .............................................................................. 0.850 CPI Telephone Services. 

Postage .................................................................................. 0.563 CPI Postage. 

Professional Fees* ................................................................. 1.405 ECI for Compensation for Professional and Technical Workers. 

Other Products* ..................................................................... 6.419 CPI All Items Less Food and Energy. 

Other Services* ...................................................................... 7.396 ECI for Compensation for Service Workers. 

Transportation ............................................................................... 2.744 CPI Private Transportation. 

Capital-Related .............................................................................. 3.023

Insurance ............................................................................... 0.275 CPI Household Insurance. 

Fixed Capital .......................................................................... 1.777 CPI Owner’s Equivalent Rent. 

Movable Capital ..................................................................... 0.971 PPI Machinery & Equipment. 

Total ................................................................................ 100.000 **

* New break-out in cost structure when compared with the 1993-Based home health market basket. 

** Figures may not sum to total due to rounding. 

Note: Price Proxy explanations are described below.

After we computed the 2000 cost 

category weights for the proposed 

rebased home health market basket, we 

selected the most appropriate wage and 

price indexes to proxy the rate of change 

for each expenditure category. These 

price proxies are based on Bureau of 

Labor Statistics (BLS) data and are 

grouped into one of the following BLS 

categories: 

• Employment Cost Indexes—

Employment Cost Indexes (ECIs) 

measure the rate of change in employee 

wage rates and employer costs for 

employee benefits per hour worked. 

These indexes are fixed-weight indexes 

and strictly measure the change in wage 

rates and employee benefits per hour. 

They are not affected by shifts in skill 

mix. ECIs are superior to average hourly 

earnings as price proxies for input price 

indexes for two reasons: (a) They 

measure pure price change; and (b) they 

are available by occupational groups, 

not just by industry. 

• Consumer Price Indexes—

Consumer Price Indexes (CPIs) measure 

change in the prices of final goods and 

services bought by the typical 

consumer. Consumer price indexes are 

used when the expenditure is more 

similar to that of a purchase at the retail 

level rather than at the wholesale level, 

or if no appropriate Producer Price 

Indexes (PPIs) were available. 

• Producer Price Indexes—PPIs are 

used to measure price changes for goods 

sold in other than retail markets. For 

example, a PPI for movable equipment 

is used rather than a CPI for equipment. 

PPIs in some cases are preferable price 

proxies for goods that HHAs purchase at 

wholesale levels. These fixed-weight 

indexes are a measure of price change 

at the producer or at the intermediate 

stage of production. 

As part of the revising and rebasing of 

the home health market basket, we are 

proposing to rebase the home health 

blended wage and salary index and the 

home health blended benefits index. We 

would use these blended indexes as 

price proxies for the wages and salary 

and the employee benefits portions of 

the proposed 2000-based home health 

market basket, as we did in the 1993-

based home health market basket. The 

price proxies for these two cost 

categories are the same as those used in 

the 1993-based home health market 

basket with occupational weights 

reflecting the FY 2000 occupational mix 

in HHAs. These proxies are a 

combination of internal (health-industry 

specific) and external (economy-wide) 

proxies. The supply and demand 

relationships for certain professionaltechnical occupations, such as 

registered nurses, may be more 

appropriately reflected in the blended 

indicators of compensation changes for 

professional and technical employees. 

3. Price Proxies Used To Measure Cost 

Category Growth 

a. Wages and Salaries, including an 

allocation for contract services’ labor: 

For measuring price growth in the 2000-

based home health market basket, as we 

did in the 1993-based index, five price 

proxies would be applied to the four 

occupational subcategories within the 

wages and salaries component, and 

would be weighted to reflect the HHA 

occupational mix. This approach was 

used because there is not a wage proxy 

for home health care workers that 

reflects only wage changes and not both 

wage and skill mix changes. The 

Professional and Technical occupational 

subcategory is represented by a 50–50 

blend of hospital industry and 

economy-wide price proxies. Therefore, 

there are five price proxies used for the 

four occupational subcategories. The 

percentage change in the blended wages 

and salaries price is applied to the 

wages and salaries component of the 

home health market basket, which is 

described in Table 3.

Federal Register / Vol. 69, No. 106 / Wednesday, June 2, 2004 / Proposed Rules 31253

TABLE 3.—PROPOSED HOME HEALTH OCCUPATIONAL WAGES AND SALARIES INDEX

[Wages and salaries component of the proposed 2000-based home health market basket] 

Cost category Weight Price proxy 

Skilled Nursing & Therapists & Other Professional/Technical, 

including an allocation for contract services’ labor.

53.816 • 50 percent ECI for Wages & Salaries in Private Industry for 

Professional, Specialty & Technical Workers. • 50 percent 

ECI for Wages & Salaries for Civilian Hospital Workers. 

Managerial/Supervisory, including an allocation for contract 

services’ labor.

7.431 ECI for Wages & Salaries in Private Industry for Executive, 

Administrative & Managerial Workers. 

Clerical, including an allocation for contract services’ labor ...... 6.822 ECI for Wages & Salaries in Private Industry for Administrative 

Support, Including Clerical Workers. 

Service, including an allocation for contract services’ labor ...... 31.931 ECI for Wages & Salaries in Private Industry Service Occupations. 

Total ..................................................................................... 100.000 

We experimented with using a 

different blend of ECIs for wages and 

salaries. In addition to using 50 percent 

professional and technical workers and 

50 percent hospital workers for the 

professional/technical workers category, 

we also tried using—

• 100 percent of the professional and 

technical ECI; 

• 50 percent professional/technical 

and 50 percent health services workers; 

and 

• 100 percent health services 

workers. 

There was very little difference 

between the three wage and salary 

blends and the proposed price proxy. 

The average difference from 1998 to 

2002 between the price proxy chosen 

and the experimental blends was at 

most 0.2 percentage point in any given 

year. We did not propose a change from 

our current blended measure because 

we believe it reflects the competition 

between HHAs and hospitals for 

registered nurses, while still capturing 

the overall wage trends for professional 

and technical workers. 

b. Employee Benefits, including an 

allocation for contract services’ labor: 

For measuring employee benefits price 

growth in the 2000-based home health 

market basket, price proxies are applied 

to the four occupational subcategories 

within the employee benefits 

component, weighted to reflect the 

home health occupational mix. The 

professional and technical occupational 

subcategory is represented by a blend of 

hospital industry and economy-wide 

price proxies. Therefore, there are five 

price proxies for four occupational 

subcategories. The percentage change in 

the blended price of home health 

employee benefits is applied to this 

component, which is described in Table 

4.

TABLE 4.—PROPOSED HOME HEALTH OCCUPATIONAL BENEFITS INDEX

[Employee benefits component of the proposed 2000-based home health market basket] 

Cost category Weight Price proxy 

Skilled Nursing & Therapists & Other Professional/Technical, 

including an allocation for contract services’ labor.

53.492 • 50 percent ECI for Benefits in Private Industry for Professional, Specialty & Technical Workers. 

• 50 percent ECI for Benefits for Civilian Hospital Workers. 

Managerial/Supervisory, including an allocation for contract 

services’ labor.

7.232 ECI for Benefits in Private Industry for Executive, Administrative & Managerial Workers. 

Clerical, including an allocation for contract services’ labor ...... 6.914 ECI for Benefits in Private Industry for Administrative Support, 

Including Clerical Workers. 

Service, including an allocation for contract services’ labor ...... 32.362 ECI for Benefits in Private Industry Service Occupations. 

Total ..................................................................................... 100.000 

As we did for wages and salaries, we 

analyzed three different alternatives to 

use as a proxy for professional/technical 

benefits. The result of this analysis was 

similar to that found for wages and 

salaries. Therefore, we are proposing to 

continue to use the same 50–50 split for 

benefits for professional and technical 

workers (50 percent hospital workers 

and 50 percent professional and 

technical workers) as we did in the 

1993-based market basket. 

c. Operations and Maintenance: The 

percentage change in the price of Fuel 

and Other Utilities as measured by the 

Consumer Price Index is applied to this 

component. The same proxy was used 

for the 1993-based market basket. 

d. Telephone: The percentage change 

in the price of Telephone Service as 

measured by the Consumer Price Index 

is applied to this component. The same 

proxy was used for the 1993-based 

market basket. 

e. Postage: The percentage change in 

the price of Postage as measured by the 

Consumer Price Index is applied to this 

component. The same proxy was used 

for the 1993-based market basket. 

f. Professional Fees: The percentage 

change in the price of Professional Fees 

as measured by the ECI for 

Compensation for Professional and 

Technical Workers is applied to this 

component. This category was not 

broken out separately in the 1993-based 

home health market basket. 

g. Other Products: The percentage 

change in the price for all items less 

food and energy as measured by the 

Consumer Price Index is applied to this 

component. This category was not 

broken out separately in the 1993-based 

home health market basket. It includes 

paper and printing that was a separate 

cost category in the 1993-based home 

health market basket. 

h. Other Services: The percentage 

change in the Employment Cost Index 

for Compensation for Service Workers is 

applied to this component. This 

category was not broken out separately 

31254 Federal Register / Vol. 69, No. 106 / Wednesday, June 2, 2004 / Proposed Rules 

in the 1993-based home health market 

basket. 

i. Transportation: The percentage 

change in the price of Transportation as 

measured by the Consumer Price Index 

is applied to this component. The same 

proxy was used for the 1993-based 

market basket. 

j. Insurance: The percentage change in 

the price of Household Insurance as 

measured by the Consumer Price Index 

is applied to this component. The same 

proxy was used for the 1993-based 

market basket. 

k. Fixed Capital: The percentage 

change in the price of Owner’s 

Equivalent Rent as measured by the 

Consumer Price Index is applied to this 

component. The same proxy was used 

for the 1993-based market basket. 

l. Movable Capital: The percentage 

change in the price of Machinery and 

Equipment as measured by the Producer 

Price Index is applied to this 

component. The same proxy was used 

for the 1993-based market basket. 

As we did in the 1993-based home 

health market basket, we allocated the 

Contract Services’ share of home health 

agency expenditures among Wages and 

Salaries, Employee Benefits, 

Administrative and General and Other 

Expenses. This method reflects the 

distribution of expenditures for contract 

services as indicated in the Medicare 

Cost Report.

Table 5 summarizes the proposed 

2000-based proxies and compares them 

to the 1993-based proxies.

TABLE 5.—COMPARISON OF PRICE PROXIES USED IN THE 1993-BASED AND THE PROPOSED 2000-BASED HOME HEALTH

MARKET BASKETS

Cost category 1993-based price proxy 2000-based proposed price proxy 

Compensation, including allocated contract services’ labor: 

Wages and Salaries, including allocated contract services’ labor.Home Health Agency Occupational 

Wage Index.

Same. 

Employee Benefits, including allocated contract services’

labor.

Home Health Agency Occupational 

Benefits Index.

Same. 

Operations and Maintenance ................................................... CPI-Fuel and Other Utilities .................. Same. 

Adminstrative & General & Other Expenses, including allocated contract services’ labor: 

Telephone ......................................................................... CPI–U Telephone .................................. Same. 

Postage ............................................................................. CPI–U Postage ..................................... Same. 

Professional Fees ............................................................. N/A ........................................................ ECI for Compensation for Professional 

and Technical Workers. 

Other Products .................................................................. N/A ........................................................ CPI–U for All Items Less Food and Energy. 

Other Services .................................................................. DN/A ...................................................... ECI for Compensation for Service 

Workers. 

Other Administrative and General .................................... CPI Services ......................................... N/A. 

Paper & Printing ............................................................... CPI for Household Paper Products & 

Stationary Supplies.

N/A. 

Transportation .......................................................................... CPI Transportation ................................ Same. 

Capital-Related: 

Insurance .......................................................................... CPI Household Insurance ..................... Same. 

Fixed Capital ..................................................................... CPI Owner’s Equivalent Rent ............... Same. 

Movable Capital ................................................................ PPI Machinery and Equipment ............. Same. 

Other Expenses, including allocated contract services’ labor CPI All Items Less Food and Energy ... N/A. 

Contract Services ..................................................................... Contained within Wages & Salaries, 

Employee Benefits, Administrative & 

General, Other Expenses; see those 

price proxies.

Contained within Wages & Salaries, 

Employee Benefits, Administrative & 

General & Other Expenses; see 

those price proxies. 

4. Rebasing Results 

A comparison of the yearly changes 

from FY 1999 to FY 2002 for the 1993-

based home health market basket and 

the proposed 2000-based home health 

market basket is shown in Table 6. The 

average annual increase in the two 

market baskets is similar, and in no year 

is the difference as much as 0.1 

percentage point.

TABLE 6.—COMPARISON OF THE 1993-BASED HOME HEALTH MARKET BASKET AND THE PROPOSED 2000-BASED HOME

HEALTH MARKET BASKET, PERCENT CHANGE, 1999–2002 

Fiscal years beginning October 1 

Home health

market basket, 

1993-based 

Proposed

home health

market basket,

2000-based 

Difference

(proposed 2000-

based less

1993-based) 

Historical: October 1998, FY 1999 ............................................................................ 2.8 2.8 0.0 

October 1999, FY 2000 ............................................................................................. 3.6 3.5 ¥0.1 

Ocobter 2000, FY 2001 ............................................................................................. 4.2 4.1 ¥0.1 

October 2001, FY 2002 ............................................................................................. 3.6 3.6 0.0 

Average Change: 1999–2002 .................................................................................... 3.6 3.5 ¥0.1 

Source: Global Insight, Inc, 4th Qtr, 2003; @USMACRO/CONTROL1103 @CISSIM/TL1103.SIM. 

Federal Register / Vol. 69, No. 106 / Wednesday, June 2, 2004 / Proposed Rules 31255

Section 1895(b)(3)(B) of the Act, as 

amended by MMA, requires the 

standard prospective payment amounts 

to be paid on a calendar year basis for 

2004 and any subsequent year. Previous 

market basket updates were calculated 

on a fiscal year basis. Table 7 shows that 

the forecasted rate of growth for CY 

2005, beginning January 1, 2005, for the 

proposed rebased and revised home 

health market basket is 3.3 percent, 

while the forecasted rate of growth for 

the current 1993-based home health 

market basket is also 3.3 percent. As 

previously mentioned, we rebase the 

home health market basket periodically 

so the cost category weights continue to 

reflect changes in the mix of goods and 

services that HHAs purchase in 

furnishing home health care.

TABLE 7.—FORECASTED ANNUAL PERCENT CHANGE IN THE CURRENT AND PROPOSED REVISED AND REBASED HOME

HEALTH MARKET

Calendar year beginning January 1 

Home health

market basket, 

1993-based 

Proposed

home health

market basket,

2000-based 

Difference

(proposed 2000-

based less

1993-based) 

January 2005, CY 2005 ............................................................................................. 3.3 3.3 0.0 

Source: Global Insight, Inc, 4th Qtr, 2003; @USMACRO/CONTROL1103 @CISSIM/TL1103.SIM. 

Table 8 shows the percent changes for 

CY 2005 for each cost category in the 

home health market basket.

TABLE 8.—CY 2005 FORECASTED ANNUAL PERCENT CHANGE FOR ALL COST CATEGORIES IN THE PROPOSED 2000-

BASED HOME HEALTH MARKET BASKET

Cost categories Weight Price proxy 

Forecasted 

annual percent 

change for CY 

2005

Total ........................................................................................... 100.000 .......................................................................... 3.3 

Compensation ............................................................................ 76.775 .......................................................................... 3.6 

Wages and Salaries ........................................................... 65.766 Proposed Home Health Occupational Wage 

Index.

3.5 

Employee Benefits ............................................................. 11.009 Proposed Home Health Occupational Benefits 

Index.

4.3 

Operations & Maintenance ........................................................ 0.825 CPI Fuel & Other Utilities ................................ 0.0 

Adminsitrative & General & Other Expenses ............................ 16.633 .......................................................................... 2.5 

Telephone ........................................................................... 0.850 CPI Telephone Services .................................. 0.8 

Postage .............................................................................. 0.563 CPI Postage .................................................... 3.7 

Professional Fees* ............................................................. 1.405 ECI for Compensation for Professional and 

Technical Workers.

3.7 

Other Products* .................................................................. 6.419 CPI All Items Less Food and Energy .............. 1.3 

Other Services* .................................................................. 7.396 ECI for Compensation for Service Workers .... 3.6 

Transportation ............................................................................ 2.744 CPI Private Transportation .............................. 2.2 

Capital-Related .......................................................................... 3.023 .......................................................................... 1.8 

Insurance ............................................................................ 0.275 CPI Household Insurance ............................... 3.2 

Fixed Capital ...................................................................... 1.777 CPI Owner’s Equivalent Rent .......................... 2.4 

Movable Capital .................................................................. 0.971 PPI Machinery & Equipment ........................... 0.3 

* New break-out in cost structure when compared with the 1993-based home health market basket. 

Source: Global Insight, Inc, 4th Qtr, 2003; @USMACRO/CONTROL1103 @CISSIM/TL1103.SIM. 

5. Labor-Related Share 

In the 1993-based home health market 

basket the labor-related share was 

77.668 percent while the remaining 

nonlabor-related share was 22.332 

percent. In the proposed revised and 

rebased home health market basket, the 

labor-related share would be 76.775 

percent. The labor-related share 

includes wages and salaries and 

employee benefits. The proposed 

nonlabor-related share would be 23.225 

percent. The lower share of labor-related 

costs in 2000 may reflect in part the 

changing cost structure associated with 

the implementation of the prospective 

payment system for HHAs. 

Table 9 details the components of the 

labor-related share for the 1993-based 

and proposed 2000-based home health 

market baskets.

TABLE 9.—LABOR-RELATED SHARE OF CURRENT AND PROPOSED HOME HEALTH MARKET BASKETS

Cost category 

1993-based

market basket

weight 

Proposed 2000-

based market 

basket weight 

Wages and Salaries ........................................................................................................................................ 64.226 65.766 

Employee Benefits ........................................................................................................................................... 13.442 11.009 

Total Labor Related ......................................................................................................................................... 77.668 76.775 

31256 Federal Register / Vol. 69, No. 106 / Wednesday, June 2, 2004 / Proposed Rules 

TABLE 9.—LABOR-RELATED SHARE OF CURRENT AND PROPOSED HOME HEALTH MARKET BASKETS—Continued

Cost category 

1993-based

market basket

weight 

Proposed 2000-

based market 

basket weight 

Total Non-Labor Related ................................................................................................................................. 22.332 23.225 

C. Proposed CY 2005 Update to the 

Home Health Market Basket Index 

Section 1895(b)(3)(B) of the Act, as 

amended by section 701 of the MMA, 

requires for CY 2005 that the standard 

prospective payment amounts be 

increased by a factor equal to the 

applicable home health market basket 

increase minus 0.8 percentage point. As 

previously noted, we are proposing to 

amend the regulations in § 484.225 to 

reflect this requirement. 

• Proposed CY 2005 Adjustments

In calculating the annual update for 

the CY 2005 60-day episode rates, we 

are proposing to first look at the CY 

2004 rates as a starting point. The CY 

2004 national 60-day episode rate, as 

modified by section 701 of the MMA 

and implemented through Pub. 100–20 

One Time Notification, Transmittal 59 

issued February 20, 2004 is $2,213.37. 

In order to calculate the CY 2005 

national 60-day episode rate, we are 

proposing to multiply the CY 2004 

national 60-day episode rate ($2,213.37) 

by the applicable home health market 

basket update of 3.3 percent for CY 2005 

minus 0.8 percentage point. 

We would increase the CY 2004 60-

day episode payment rate by the 

proposed home health market basket 

increase (3.3 percent) minus 0.8 

percentage point ($2,213.37 x 2.5 

percent) to yield the proposed updated 

CY 2005 national 60-day episode rate 

($2,268.70) (see Table 10 below).

TABLE 10.—PROPOSED NATIONAL 60-DAY EPISODE AMOUNTS UPDATED BY THE APPLICABLE HOME HEALTH MARKET

BASKET CY 2005, MINUS 0.8 PERCENTAGE POINT, BEFORE CASE-MIX ADJUSTMENT, WAGE INDEX ADJUSTMENT

BASED ON THE SITE OF SERVICE FOR THE BENEFICIARY OR APPLICABLE PAYMENT ADJUSTMENT

Total prospective payment amount per 60-day episode for CY 2004

(as of 04/04/04) 

Multiply by the applicable home health market 

basket increase (3.3 

percent) minus 0.8 percentage point 

Proposed CY 2005 updated national 60-day 

episode rate 

$2,213.37 ................................................................................................................................. × 1.025 $2,268.70 

• National Per-visit Amounts Used to 

Pay LUPAs and Compute Imputed Costs 

Used in Outlier Calculations

As discussed previously in this 

proposed rule, the policies governing 

the LUPAs and outlier calculations set 

forth in the July 3, 2000 HH PPS final 

rule will continue during CY 2005. In 

calculating the annual update for the CY 

2005 national per-visit amounts we use 

to pay LUPAs and to compute the 

imputed costs in outlier calculations, 

we are proposing to look again at the CY 

2004 rates as a starting point. We then 

are proposing to multiply those amounts 

by the proposed home health market 

basket increase minus 0.8 percentage 

point for CY 2005 to yield the updated 

per-visit amounts for each home health 

discipline for CY 2005. (See Table 11 

below.)

TABLE 11.—PROPOSED NATIONAL PER-VISIT AMOUNTS FOR LUPAS AND OUTLIER CALCULATIONS UPDATED BY THE APPLICABLE HOME HEALTH MARKET BASKET INCREASE FOR CY 2005, MINUS 0.8 PERCENTAGE POINT, BEFORE WAGE

INDEX ADJUSTMENT BASED ON THE SITE OF SERVICE FOR THE BENEFICIARY

Home health discipline type 

Final per-visit amounts 

per 60-day episode for 

CY 2004 for LUPAs (as 

of 04/01/04) 

Multiply by the applicable home health market 

basket (3.3 percent) 

minus 0.8 percentage 

point 

Proposed per-visit payment amount per discipline for CY 2005 for 

LUPAs 

Home Health Aide ....................................................................... $43.75 × 1.025 $44.84 

Medical Social Services ............................................................... 154.89 × 1.025 158.76 

Occupational Therapy .................................................................. 106.36 × 1.025 109.02 

Physical Therapy ......................................................................... 105.65 × 1.025 108.29 

Skilled Nursing ............................................................................. 96.63 × 1.025 99.05 

Speech-Language Pathology ...................................................... 114.80 × 1.025 117.67 

D. Proposed Update to the Outlier Fixed 

Dollar Loss Ratio 

Outlier payments are payments made 

in addition to regular 60-day case-mix 

and wage-adjusted episode payments for 

episodes that incur unusually large 

costs due to patient home health care 

needs. Outlier payments are made for 

episodes whose estimated cost exceeds 

a threshold amount. The episode’s 

estimated cost is the sum of the national 

wage-adjusted per-visit payment 

amounts for all visits delivered during 

the episode. The outlier threshold for 

each case-mix group, PEP adjustment, or 

total SCIC adjustment is defined as the 

60-day episode payment amount, PEP 

adjustment, or total SCIC adjustment for 

that group plus a fixed dollar loss 

amount. Both components of the outlier 

threshold are wage-adjusted. 

The wage-adjusted fixed dollar loss 

amount (FDL) represents the amount of 

loss that an agency must bear before an 

episode becomes eligible for outlier 

payments. The FDL is computed by 

Federal Register / Vol. 69, No. 106 / Wednesday, June 2, 2004 / Proposed Rules 31257

multiplying the wage-adjusted 60-day 

episode payment amount by the fixed 

dollar loss ratio, which is a proportion 

expressed in terms of the national 

standardized episode payment amount. 

The outlier payment is defined to be a 

proportion of the wage-adjusted 

estimated costs beyond the wageadjusted threshold. The proportion of 

additional costs paid as outlier 

payments is referred to as the losssharing ratio. 

Section 1895(b)(5) of the Act requires 

that estimated total outlier payments are 

no more than 5 percent of total 

estimated HH PPS payments. In 

response to the concerns about potential 

financial losses that might result from 

unusually expensive cases expressed in 

comments to the October 28, 1999 

proposed rule (64 FR 58133), the July 

2000 final rule set the target for 

estimated outlier payments at the 5 

percent level. The fixed dollar loss ratio 

and the loss-sharing ratio were then 

selected so that estimated total outlier 

payments would meet the 5 percent 

target. 

For a given level of outlier payments, 

there is a trade-off between the values 

selected for the fixed dollar loss ratio 

and the loss-sharing ratio. A high fixed 

dollar loss ratio reduces the number of 

episodes that can receive outlier 

payments, but makes it possible to 

select a higher loss-sharing ratio and, 

therefore, increase outlier payments for 

outlier episodes. Alternatively, a lower 

fixed dollar loss ratio means that more 

episodes can qualify for outlier 

payments, but outlier payments per 

episode must be lower. As a result of 

public comments on the October 28, 

1999 proposed rule, in our July 2000 

final rule, we made the decision to 

attempt to cover a relatively high 

proportion of the costs of outlier cases 

for the most expensive episodes that 

would qualify for outlier payments 

within the 5 percent constraint.

We chose a value of 0.80 for the losssharing ratio, which is relatively high, 

but which preserves incentives for 

agencies to attempt to provide care 

efficiently for outlier cases. It is also 

consistent with the loss-sharing ratios 

used in other Medicare PPS outlier 

policies. Having made this decision, we 

estimated the value of the fixed dollar 

loss ratio that would yield estimated 

total outlier payments that were 5 

percent of total home health PPS 

payments. The resulting value for the 

fixed dollar loss ratio was 1.13. 

Analysis of 100 percent of CY 2001 

home health claims data reflects that 

outlier episodes represent 

approximately 3 percent of total 

episodes and 3 percent of total HH PPS 

payments. Preliminary analysis of CY 

2002 home health claims data indicates 

no change in that parameter. Therefore, 

it is appropriate to update the outlier 

policy based on more recent data than 

were available when the July 2000 final 

rule for HH PPS was developed. We are 

proposing to make no change in the 5 

percent target for outlier expenditures as 

a percent of total HH PPS payments. In 

addition, we are not proposing to 

change the loss-sharing ratio of 0.80. 

Further, section 1895(b)(3)(C) of the Act 

requires that the episode payment 

amounts be adjusted to effectively pay 

for outlier payments within the same 

level of estimated total spending. We are 

not proposing to change the adjustment 

to the episode payment amounts for 

outlier payments. Therefore, the 

proposed update would only change the 

fixed dollar loss ratio, and in turn, the 

fixed dollar loss amount. 

We performed data analysis on CY 

2001 HH PPS analytic data to update the 

fixed dollar loss ratio to enable the total 

estimated outlier payments to be 5 

percent of total HH PPS payments. The 

results of this analysis indicate that a 

fixed dollar loss ratio of 0.72 is 

consistent with the existing loss-sharing 

ratio of 0.80 and a target percentage of 

estimated outlier payments of 5 percent. 

Consequently, we are proposing to 

update the fixed dollar loss ratio from 

the current ratio of 1.13 to the fixed 

dollar loss ratio of 0.72. Reducing the 

fixed dollar loss ratio from 1.13 to 0.72 

would allow approximately 6.5 percent 

of episodes to qualify for outlier 

payments. The estimated 6.5 percent 

outlier episodes is greater than the 3.0 

percent of episodes that currently 

qualify for outlier payments, and is 

about the same as the 6.8 percent for 

outlier episodes that we estimated in 

our July 2000 final rule. 

Expressed in terms of a fixed dollar 

loss amount, the proposed fixed dollar 

loss ratio of 0.72 implies that providers 

would absorb approximately $1,633 of 

their costs (before wage adjustment), in 

addition to their loss-sharing portion of 

the estimated cost in excess of the 

outlier threshold. This fixed dollar loss 

amount of approximately $1,633 is 

computed by multiplying the proposed 

standard 60-day episode payment 

amount ($2,268.70) by the proposed 

fixed dollar loss ratio (0.72). Using the 

current fixed dollar loss ratio (1.13), the 

fixed dollar loss amount would be 

approximately $2,564 ($2,268.70 * 

1.13). We believe that our proposed 

fixed dollar loss ratio of 0.72 preserves 

a reasonable degree of cost sharing, 

while allowing a greater number of 

episodes to qualify for outlier payments. 

In the final rule, following publication 

of this proposed rule, we plan to update 

our estimate of the fixed dollar loss ratio 

using the most current, complete year of 

HH PPS data available. 

The following analytical tables 12(a) 

through 12(f), derived from analysis of 

CY 2001 home health claims data, 

characterize outlier episodes, and depict 

the differences between outlier and nonoutlier episodes with regards to home 

health resource groups (HHRGs) and 

visit disciplines. Tables 12(a) through 

12(f) illustrate various characteristics of 

outlier episodes. Outlier episodes are 

more likely to be of a higher clinical 

severity than are non-outlier episodes. 

Functional status levels are, however, 

very similar across all types of episodes. 

Our analysis further shows that outlier 

episodes are less likely to be high in 

therapy use than non-outlier episodes. 

In addition, the top high volume HHRGs 

seen in outlier episodes are also seen as 

high volume HHRGs in non-outlier 

episodes. Finally, our analysis also 

shows that skilled nursing visits are 

highly prevalent in outlier episodes. 

This analysis excludes LUPAs, as those 

episodes inherently do not involve the 

use of HHRGs and hence are not paid 

based on HHRGs. In the final rule, we 

will confirm all data analysis based on 

100 percent home health claims for CY 

2002 and available preliminary CY 2003 

home health claims data.

TABLE 12–a.—SEVERITY LEVEL COMPARISON OF HHRG’S CLINICAL DOMAIN IN OUTLIER & NON-OUTLIER

EPISODES

Clinical domain severity 

level 

Percentage

of outlier

episodes 

Percentage of 

non-outlier 

episodes 

C1 9 20 

C2 19 33 

C3* 52 36 

C4* 20 11 

* Outlier episodes are more likely to be of a 

higher clinical severity level than are nonoutlier episodes. 

TABLE 12–b.—SEVERITY LEVEL COMPARISON OF HHRG’S FUNCTIONAL

DOMAIN IN OUTLIER AND NONOUTLIER EPISODES

Functional 

domain severity level 

Percentage

of outlier

episodes 

Percentage of 

non-outlier 

episodes 

F0 6 7 

F1 22 25 

F2 47 43 

F3 13 13 

F4 12 12 

Note: Functional status levels are similar 

for both outlier and non-outlier episodes.

31258 Federal Register / Vol. 69, No. 106 / Wednesday, June 2, 2004 / Proposed Rules 

TABLE 12–c.—HIGH-THERAPY EPISODE COMPARISON IN OUTLIER AND

NON-OUTLIER EPISODES

Type of episode 

Percentage of 

outlier 

episodes 

Percentage of 

nonoutlier 

episodes 

Episodes with 10 or 

more therapy visits .... 11* 24 

TABLE 12–c.—HIGH-THERAPY EPISODE COMPARISON IN OUTLIER AND

NON-OUTLIER EPISODES—Continued

Type of episode 

Percentage of 

outlier 

episodes 

Percentage of 

nonoutlier 

episodes 

All Other Episodes ........ 89 76 

* Outlier episodes are less likely to be episodes with high therapy use (at least 10 therapy visits) than are non-outlier episodes. 

TABLE 12–d.—TOP 10 HHRG COMPARISON IN OUTLIER AND NON-OUTLIER EPISODES

HHRG (weight) Outlier rank 

Percentage of 

outlier

episodes 

Non-outlier 

rank 

Percentage of 

non-outlier

episodes 

C2F2S0 ............................................................................................................ 1 20.3 2 10.7 

C2F1S0 ............................................................................................................ 2 12.4 6 5.1 

C1F2S0 ............................................................................................................ 3 6.1 1 11.3 

C3F2S0 ............................................................................................................ 4 5.8 13 2.4 

C1F1S0 ............................................................................................................ 5 5.3 3 6.4 

C3F4S0 ............................................................................................................ 6 5.0 8 3.9 

C2F3S0 ............................................................................................................ 7 4.8 11 3.2 

C2F4S0 ............................................................................................................ 8 3.8 10 3.5 

C3F0S0 ............................................................................................................ 9 3.6 23 1.3 

C3F3S0 ............................................................................................................ 10 3.3 20 1.4 

C0F2S0 ............................................................................................................ 11 3.1 4 6.0 

C0F1S0 ............................................................................................................ 12 2.6 5 5.7 

C2F2S1 ............................................................................................................ 15 1.7 7 4.1 

C1F2S2 ............................................................................................................ 18 1.0 9 3.7 

Top 10 HHRGs, Outlier Episodes ................................................................... ........................ 70.4 ........................ ........................

Top 10 HHRGs, Non-Outlier Episodes ............................................................ ........................ ........................ ........................ 60.4 

Note: Except for two HHRGs (C3F0S0 & C3F3S0), the top 10 HHRGs that occur in outlier episodes are also within the top 13 HHRGs in nonoutlier episodes. 

TABLE 12–e.—PERCENTAGES OF VISIT TYPES IN OUTLIER AND NON-OUTLIER EPISODES

Home health visits Outlier

episodes 

Non-outlier

episodes 

Average Total Visits ................................................................................................................................................. 84.5 19.7 

Percentage of Total Visits: 

Skilled Nursing Visits 1 ...................................................................................................................................... 75.3 45.1 

Home Health Aide Visits .................................................................................................................................. 18.6 26.3 

Physical Therapy Visits 2 .................................................................................................................................. 3.8 22.8 

Occupational Therapy Visits 2 .......................................................................................................................... 1.4 4.0 

Speech Therapy Visits 2 ................................................................................................................................... 0.5 0.8 

Medical Social Visits ......................................................................................................................................... 0.4 1.0 

1Skilled nursing visits make up a significantly greater percentage of total visits in outlier episodes than in non-outlier episodes. 2Therapy visits are a substantially smaller percentage of total visits in outlier episodes than in non-outlier episodes. 

TABLE 12–f.—PROBABILITY OF AT LEAST 1 OCCURRENCE OF A PARTICULAR TYPE OF VISIT IN AN EPISODE FOR OUTLIER

AND NON-OUTLIER EPISODES

Home health visits 

Outlier

episodes

(percent) 

Non-outlier

episodes

(percent) 

Probability of at least 1 service occurring: 

Skilled Nursing Visits 1 ...................................................................................................................................... 99.8 89.3 

Home Health Aide Visits 2 ................................................................................................................................ 44.6 35.6 

Physical Therapy (PT) Visits 3 .......................................................................................................................... 27.9 48.6 

Occupational Therapy (OT) Visits .................................................................................................................... 11.6 14.4 

Speech Therapy Visits ..................................................................................................................................... 3.4 2.7 

Medical Social Visits ......................................................................................................................................... 16.4 12.5 

Federal Register / Vol. 69, No. 106 / Wednesday, June 2, 2004 / Proposed Rules 31259

TABLE 12–f.—PROBABILITY OF AT LEAST 1 OCCURRENCE OF A PARTICULAR TYPE OF VISIT IN AN EPISODE FOR OUTLIER

AND NON-OUTLIER EPISODES—Continued

Home health visits 

Outlier

episodes

(percent) 

Non-outlier

episodes

(percent) 

Any Therapy (PT, OT, Speech) ....................................................................................................................... 29.4 50.4 

1Skilled nursing visits are almost always present in outlier episodes. 

2 Home health aide visits occur in slightly less than 50 percent of outlier episodes. 

3Physical Therapy is less likely to occur in an outlier episode than in a non-outlier episode. 

E. Rural Add-On as Required by the 

MMA 

As discussed in section I.D. of this 

preamble, section 421 of the MMA 

requires, for home health services 

furnished in a rural area with respect to 

episodes and visits ending on or after 

April 1, 2004 and before April 1, 2005, 

that we increase by 5 percent the 

payment amount that otherwise would 

be made for these services. The statute 

waives budget neutrality related to this 

provision. By statute, the 5 percent rural 

add-on applies to home health services 

furnished in a rural area (as defined in 

section 1886(d)(2)(D) of the Act) for 

episodes and visits ending on or after 

April 1, 2004 and before April 1, 2005. 

Therefore, the 5 percent rural add-on 

ends after the first quarter of CY 2005 

for episodes and visits ending before 

April 1, 2005. After the rural add-on is 

determined, the applicable case-mix and 

wage index adjustment is then 

subsequently applied for the provision 

of home health services where the site 

of service is the non-Metropolitan 

Statistical Area (MSA) of the 

beneficiary. Similarly, the applicable 

wage index adjustment is subsequently 

applied to the LUPA per visit amounts 

adjusted for the provision of home 

health services where the site of service 

for the beneficiary is a non-MSA area. 

We implemented this provision for CY 

2004 on April 1, 2004 through Pub. 

100–20 One Time Notification, 

Transmittal 59 issued February 20, 

2004. The CY 2005 5 percent rural addon is noted in tables below.

TABLE 13.—PROPOSED CY 2005 RURAL ADD-ON TO 60-DAY EPISODE PAYMENT AMOUNTS ENDING ON OR AFTER APRIL

1, 2004 AND BEFORE APRIL 1, 2005 FOR BENEFICIARIES WHO RESIDE IN A NON-MSA AREA BEFORE CASE-MIX ADJUSTMENT, WAGE INDEX ADJUSTMENT BASED ON THE SITE OF SERVICE FOR THE BENEFICIARY OR APPLICABLE PAYMENT ADJUSTMENT

Proposed total prospective payment amount per 60-day episode for CY 2005 5 percent rural add-on 

Proposed CY 2005 final 

payment amount per 60-

day episode ending before April 1, 2005 for a 

beneficiary who resides 

in a non-MSA area 

$2,268.70 ................................................................................................................................. × 1.05 $2,382.14 

TABLE 14.—PROPOSED CY 2005 ADD-ON TO LUPA PER-VISIT AMOUNTS FOR VISITS ENDING ON OR AFTER APRIL 1, 

2004 AND BEFORE APRIL 1, 2005, BEFORE WAGE INDEX ADJUSTMENT BASED ON THE SITE OF SERVICE OF THE

BENEFICIARY WHO RESIDES IN A NON-MSA AREA OR PAYMENT APPLICABLE ADJUSTMENT

Home health discipline type 

Proposed per-visit payment amounts per 60-

day episode for CY 

2005 for LUPAs 

5 percent rural add-on 

Proposed CY 2005 pervisit payment amounts 

per 60-day episode ending before April 1, 2005 

for LUPAs for a beneficiary who resides in a 

non-MSA area 

Home Health Aide ....................................................................... $44.84 × 1.05 $47.08 

Medical Social Services ............................................................... 158.76 × 1.05 166.70 

Occupational Therapy .................................................................. 109.02 × 1.05 114.47 

Physical Therapy ......................................................................... 108.29 × 1.05 113.70 

Skilled Nursing ............................................................................. 99.05 × 1.05 104.00 

Speech-Language Pathology ...................................................... 117.67 × 1.05 123.55 

F. Hospital Wage Index 

Sections 1895(b)(4)(A)(ii) and (b)(4)(C) 

of the Act require the Secretary to 

establish area wage adjustment factors 

that reflect the relative level of wages 

and wage-related costs applicable to the 

furnishing of home health services and 

to provide appropriate adjustments to 

the episode payment amounts under HH 

PPS to account for area wage 

differences. We apply the appropriate 

wage index value to the labor portion of 

the HH PPS rates based on the 

geographic area in which the beneficiary 

received home health services. We 

determine each HHA’s labor market area 

based on definitions of Metropolitan 

Statistical Areas (MSAs) issued by the 

Office of Management and Budget 

(OMB). We recognize that on June 6, 

2003, the Office of Management and 

Budget (OMB) issued OMB Bulletin No. 

03–04, announcing revised definitions 

of Metropolitan Statistical Areas, and 

new definitions of Micropolitan 

Statistical Areas, and Combined 

Statistical Areas. A copy of the Bulletin 

31260 Federal Register / Vol. 69, No. 106 / Wednesday, June 2, 2004 / Proposed Rules 

may be obtained at the following 

Internet address: http://

www.whitehouse.gov/omb/bulletins/

b03–04.html. These new definitions will 

not be applied to the CY 2005 wage 

index used in this proposed update to 

the HH payment rates. 

On May 18, 2004, we published a 

proposed rule entitled ‘‘Medicare 

Program; Changes to the Hospital 

Inpatient Prospective Payment Systems 

and FY 2005 Rates’’ (69 FR 28195), 

which discusses some of the issues 

associated with using these new 

definitions and proposes to use these 

new definitions for the Inpatient 

Hospital PPS for FY 2005. We believe it 

is appropriate to wait until the public 

comments on that proposed rule have 

been submitted and analyzed before we 

consider proposing any new labor 

market definitions in the home health 

context. 

As discussed previously and set forth 

in the July 3, 2000 final rule, the statute 

provides that the wage adjustment 

factors may be the factors used by the 

Secretary for purposes of section 

1886(d)(3)(E) of the Act for hospital 

wage adjustment factors. Again, as 

discussed in the July 3, 2000 final rule, 

we are proposing to use the pre-floor 

and pre-reclassified hospital wage index 

to adjust the labor portion of the HH 

PPS rates based on the geographic area 

in which the beneficiary receives the 

home health services. We believe the 

use of the pre-floor and pre-reclassified 

hospital wage index results in the 

appropriate adjustment to the labor 

portion of the costs as required by 

statute. For this update to the CY 2005 

home health payment rates, we propose 

to continue to use the most recent prefloor and pre-reclassified hospital wage 

index available at the time of the final 

rule. Due to the mandated change from 

a fiscal year update cycle to that of a 

calendar year update cycle, the most 

recent pre-floor and pre-reclassified 

hospital wage index available for this 

update of the CY 2005 home health 

payment rates will be that of the 2005 

pre-floor/pre-reclassified hospital wage 

index. 

Under previous fiscal year updates, 

the most recent pre-floor and prereclassified hospital wage index 

available at the time of publication of 

the HH PPS fiscal year update was that 

of the previous year. Beginning with the 

CY 2005 update to home health 

payment rates, the most recent pre-floor 

and pre-reclassified hospital wage index 

available at the time of publication will 

be that of the current year. 

Consequently, for our proposed CY 2005 

update to the home health payment 

rates, we propose to continue to use the 

most recent pre-floor and prereclassified hospital wage index 

available at the time of publication. We 

recognize that this change to a calendar 

year update cycle results in using the 

current year’s wage index values. See 

addenda A and B of this proposed rule, 

respectively, for the proposed rural and 

urban hospital wage indexes. 

Furthermore, we have added an 

addendum C that shows a side-by-side 

comparison of the FY 2003 pre-floor and 

pre-reclassified hospital wage index and 

proposed CY 2005 pre-floor and prereclassified hospital wage index for the 

CY 2005 HH PPS update proposed rule. 

For HH PPS rates addressed in this 

proposed rule, we are using a 

preliminary 2005 pre-floor and prereclassified hospital wage index. We 

will incorporate updated wage data for 

the 2005 pre-floor and pre-reclassified 

hospital wage index in the final rule for 

the CY 2005 HH PPS update. 

III. Collection of Information 

Requirements 

(If you choose to comment on issues 

in this section, please include the 

caption ‘‘COLLECTION OF 

INFORMATION REQUIREMENTS’’ at 

the beginning of your comments.) 

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 (44 

U.S.C. 3501 et seq.). 

IV. Response to Comments 

Because of the large number of items 

of correspondence we normally receive 

on Federal Register documents 

published for comment, we are not able 

to acknowledge or respond to them 

individually. We will consider all 

comments we receive by the date and 

time specified in the DATES section of 

the preamble, and, when we proceed 

with a subsequent document, we will 

respond to the comments in the 

preamble to that document.

V. 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 

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 1 year). 

The update set forth in this proposed 

rule would apply to Medicare payments 

under HH PPS in CY 2005. Accordingly, 

the following analysis describes the 

impact in CY 2005 only. We estimate 

that there would be an additional $270 

million in CY 2005 expenditures 

attributable to the CY 2005 proposed 

market basket (3.3 percent), minus 0.8 

percentage point, an estimated increase 

of 2.5 percent. 

Section 421 of the MMA provides for 

a 5 percent increase in home health 

payments to rural providers for episodes 

and visits ending after April 1, 2004 and 

before April 1, 2005. This increase is not 

subject to budget neutrality. 

Consequently, this increase in payments 

to rural providers will result in an 

estimated increase in expenditures of 

$20 million in FY 2004 and $100 

million in FY 2005. 

Section 701 of the MMA includes a 

provision that changes the update cycle 

for HH PPS, and thus the home health 

market basket update, from a fiscal year 

basis to that of a calendar year basis in 

2004. This results in a projected 

reduction in expenditures of 

approximately $90 million in FY 2005. 

The RFA requires agencies to analyze 

options for regulatory relief of small 

businesses. For purposes of the RFA, 

small entities include small businesses, 

nonprofit organizations, and 

government agencies. Most hospitals 

and most other providers and suppliers 

are small entities, either by nonprofit 

status or by having revenues of $6 

million to $29 million or less annually 

(for details, see the Small Business 

Administration’s regulation that set 

forth size standards for health care 

industries at 65 FR 69432). For purposes 

of the RFA, approximately 75 percent of 

HHAs are considered small businesses 

according to the Small Business 

Administration’s size standards with 

total revenues of $11.5 million or less in 

1 year. Individuals and States are not 

included in the definition of a small 

Federal Register / Vol. 69, No. 106 / Wednesday, June 2, 2004 / Proposed Rules 31261

entity. As stated above, this proposed 

rule would provide an update to all 

HHAs for CY 2005 as required by 

statute. This proposed rule would have 

a significant positive effect upon small 

entities. 

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 (MSA) 

and has fewer than 100 beds. We have 

determined that this proposed rule 

would not have a significant economic 

impact on the operations of a substantial 

number of small rural hospitals. 

Section 202 of the Unfunded 

Mandates Reform Act of 1995 also 

requires that agencies assess anticipated 

costs and benefits before issuing any 

rule that may result in expenditure in 

any 1 year by State, local, or tribal 

governments, in the aggregate, or by the 

private sector, of $110 million. We 

believe this proposed rule would not 

mandate expenditures in that amount. 

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. 

We have reviewed this rule under the 

threshold criteria of Executive Order 

13132, Federalism. We have determined 

that this proposed rule would not have 

substantial direct effects on the rights, 

roles, and responsibilities of States.

B. Anticipated Effects 

In accordance with the requirements 

of section 1895(b)(3) of the Act, we 

publish an update for each subsequent 

fiscal year that will provide an update 

to the payment rates. Section 

1895(b)(3)(B) of the Act, as amended by 

section 701 of the MMA, requires us, for 

CY 2005, to increase the prospective 

payment amounts by the applicable 

home health market basket increase 

minus 0.8 percentage point. We estimate 

that with a proposed home health 

market basket of 3.3 percent minus 0.8 

percentage point, the estimated 

proposed increase for CY 2005 is 2.5 

percent. 

1. Effects on the Medicare Program 

This proposed rule would merely 

provide a percentage update to all 

Medicare HHAs. Therefore, we have not 

furnished any impact tables. We would 

increase the payment to each Medicare 

HHA equally by the home health market 

basket update for CY 2005, minus 0.8 

percentage point, as required by statute. 

There is no differential impact among 

provider types. The impact is in the 

aggregate. We can show the impact that 

the proposed CY 2005 wage index 

would have on providers. Addendum C 

shows a side-by-side comparison of the 

FY 2003 pre-floor and pre-reclassified 

hospital wage index and the proposed 

CY 2005 pre-floor and pre-reclassified 

hospital wage index for the CY 2005 HH 

PPS update proposed rule. We estimate 

that there would be an additional $270 

million in CY 2005 expenditures 

attributable to the CY 2005 proposed 

market basket (3.3 percent), minus 0.8 

percentage point, estimated increase 

resulting in 2.5 percent. Thus, the 

anticipated expenditures outlined in 

this proposed rule would exceed the 

$100 million annual threshold for a 

major rule as defined in Title 5, USC, 

section 804(2). 

We estimate that the applicable home 

health market basket (minus 0.8 

percentage point) increase of 2.5 percent 

for CY 2005 applies to all Medicareparticipating HHAs. We do not believe 

there is a differential impact due to the 

aggregate nature of the update.

TABLE 15

CY 2005 update to home health PPS rates required by the act 

Additional CY 

2005 Medicare 

home health

estimated

expenditures due 

to annual

update required 

by law 

Section 1895(b)(3)(B) of the Act requires HH PPS rates increased by applicable home health market basket increase (3.3 

percent) minus 0.8 percentage point, yielding 2.5 percent ....................................................................................................... 1 $270

Source: President’s FY 2004 Budget. 1 In millions. 

2. Effects on Providers 

This proposed rule would have a 

positive effect on providers of Medicare 

home health services by increasing their 

rate of Medicare payment. We do not 

anticipate specific effects on other 

providers. This proposed rule would 

reflect the statutorily required annual 

update to the HH PPS rates. We do not 

believe there is a differential impact due 

to the consistent and aggregate nature of 

the update. 

C. Alternatives Considered 

As discussed in section II, this 

proposed rule reflects an annual update 

to the HH PPS rates as required by 

statute. We believe that the statute 

provides no latitude for alternatives 

other than the approach set forth in this 

proposed rule reflecting the CY 2005 

proposed annual update to the HH PPS 

rates. Other than the positive effect of 

the market basket increase, this 

proposed rule would not have a 

significant economic impact nor would 

it impose an additional burden on small 

entities. When a regulation or notice 

imposes additional burden on small 

entities, we are required under the RFA 

to examine alternatives for reducing 

burden. 

As discussed in the ‘‘Rebasing and 

Revising the Home Health Market 

Basket’’ section of this proposed rule, 

we believe that it is desirable to rebase 

the home health market basket 

periodically. Consequently, as part of 

this proposed rule, we are proposing to 

rebase and revise the home health 

market basket by moving the base year 

from FY 1993 to FY 2000 to reflect the 

latest available, thorough data on the 

structure of HHA costs. CMS 

periodically rebases and revises market 

baskets for multiple types of health care 

providers, generally on a 5-year cycle. 

We continue to believe that by rebasing 

and revising the home health market 

basket periodically, cost category 

weights will better reflect changes in the 

mix of goods and services that HHAs 

purchase in furnishing home health 

31262 Federal Register / Vol. 69, No. 106 / Wednesday, June 2, 2004 / Proposed Rules 

care. The alternative to not rebase and 

revise the market basket would be to 

delay the inevitable task of rebasing and 

revising the home health market basket 

to some later date. For this proposed 

rule, the forecasted rate of growth for CY 

2005 for both the proposed rebased and 

revised home health market basket and 

the current 1993-based home health 

market basket is 3.3 percent (see Table 

7 of this proposed rule). However, it 

should be noted that while for this 

proposed rule the home health market 

basket percentage is the same for both 

the 1993-based and the proposed 2000-

based rate of growth, that future updates 

will be better served by using a more 

up-to-date cost structure, as proposed in 

the revised and rebased home health 

market basket. 

Section 1895(b)(5) of the Act states 

that the total amount of payments for 

outliers, under HH PPS, may not exceed 

5 percent of the total payments 

projected or estimated to be made for a 

given fiscal year or years. As discussed 

in the ‘‘Proposed Update to the Outlier 

Fixed Dollar Loss Ratio’’ section of this 

proposed rule, we are proposing to 

reduce the fixed dollar loss ratio used in 

the formula to determine outlier cases in 

HH PPS, from that of 1.13 to 0.72. 

Analysis indicates that a fixed dollar 

loss ratio of 0.72 is consistent with the 

existing loss-sharing ratio of 0.80 and 

our target percentage of estimated 

outlier payments of 5 percent of total 

home health payments. Other 

alternatives considered in the updating 

of the formula for determining outlier 

cases included updating/changing the 

loss-sharing ratio from that of 0.80 as 

well as changing the outlier payment 

target of to less than 5 percent of total 

home health payments. We believe that 

a value of 0.80 for the loss-sharing ratio 

is appropriate in that it preserves 

incentives for agencies to provide care 

efficiently for outlier cases. Similarly, 

we continue to believe that the total 

outlier payment target of 5 percent of 

total home health payments 

appropriately targets the most costly 

cases under HH PPS. 

D. Conclusion 

We have examined the economic 

impact of this proposed rule on small 

entities and have determined that the 

economic impact is positive, significant, 

and that all HHAs would be affected. To 

the extent that small rural hospitals are 

affiliated with HHAs, the impact on 

these facilities would also be positive. 

Finally, we have determined that the 

economic effects described above are 

largely the result of the specific 

statutory provisions, which this 

proposed rule serves to announce. 

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 484 

Health facilities, Health professions, 

Medicare, Reporting and recordkeeping 

requirements.

For the reasons set forth in the 

preamble, 42 CFR chapter IV is 

proposed to be amended as set forth 

below:

PART 484—HOME HEALTH SERVICES 

1. The authority citation for part 484 

continues to read as follows:

Authority: Secs. 1102 and 1871 of the 

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

1395(hh)) unless otherwise indicated.

2. Section 484.225 is amended as 

follows: 

A. Paragraph (d) is redesignated as 

paragraph (g) and is revised. 

B. New paragraph (d) is added. 

C. New paragraph (e) is added. 

D. New paragraph (f) is added. 

The revisions and additions read as 

follows: § 484.225 Annual update of the 

unadjusted national prospective 60-day 

episode payment rate.

* * * * *

(d) For the last calendar quarter of 

2003 and the first calendar quarter of 

2004, the unadjusted national 

prospective 60-day episode payment 

rate is equal to the rate from the 

previous fiscal year (FY 2003) increased 

by the applicable home health market 

basket index amount. 

(e) For the last 3 calendar quarters of 

2004, the unadjusted national 

prospective 60-day episode payment 

rate is equal to the rate from the 

previous fiscal year (FY 2003) increased 

by the applicable home health market 

basket minus 0.8 percentage point. 

(f) For each calendar year of 2005 and 

2006, the unadjusted national 

prospective 60-day episode payment 

rate is equal to the rate from the 

previous calendar year, increased by the 

applicable home health market basket 

minus 0.8 percentage point. 

(g) For 2007 and subsequent calendar 

years, the unadjusted national rate is 

equal to the rate for the previous 

calendar year increased by the 

applicable home health market basket 

index amount.

(Catalog of Federal Domestic Assistance 

Program No. 93.773, Medicare—Hospital 

Insurance; and Program No. 93.774, 

Medicare—Supplementary Medical 

Insurance Program)

Dated: November 5, 2003. 

Thomas A. Scully, 

Administrator, Centers for Medicare & 

Medicaid Services. 

Dated: April 23, 2004. 

Tommy G. Thompson, 

Secretary.

Note: The following addenda will not be 

published in the Code of Federal Regulations.

ADDENDUM A.—PROPOSED WAGE

INDEX FOR RURAL AREAS—APPLICABLE PRE-FLOOR AND PRE-RECLASSIFIED HOSPITAL WAGE INDEX

[CY 2005] 

MSA name Wage 

index 

ALABAMA ..................................... 0.7492 

ALASKA ........................................ 1.1886 

ARIZONA ...................................... 0.9270 

ARKANSAS .................................. 0.7734 

CALIFORNIA ................................ 0.9967 

COLORADO ................................. 0.9328 

CONNECTICUT ............................ 1.2183 

DELAWARE .................................. 0.9557 

FLORIDA ...................................... 0.8855 

GEORGIA ..................................... 0.8369 

GUAM ........................................... 0.9611 

HAWAII ......................................... 0.9958 

IDAHO .......................................... 0.8974 

ILLINOIS ....................................... 0.8254 

INDIANA ....................................... 0.8824 

IOWA ............................................ 0.8416 

KANSAS ....................................... 0.8074 

KENTUCKY .................................. 0.7973 

LOUISIANA ................................... 0.7451 

MAINE .......................................... 0.8812 

MARYLAND .................................. 0.9125 

MASSACHUSETTS ...................... 1.0432 

MICHIGAN .................................... 0.8877 

MINNESOTA ................................ 0.9330 

MISSISSIPPI ................................ 0.7778 

MISSOURI .................................... 0.8056 

MONTANA .................................... 0.8800 

NEBRASKA .................................. 0.8822 

NEVADA ....................................... 0.9806 

NEW HAMPSHIRE ....................... 1.0030 

NEW JERSEY1

NEW MEXICO .............................. 0.8270 

NEW YORK .................................. 0.8526 

NORTH CAROLINA ..................... 0.8456 

NORTH DAKOTA ......................... 0.7778 

OHIO ............................................. 0.8820 

OKLAHOMA ................................. 0.7537 

OREGON ...................................... 0.9994 

PENNSYLVANIA .......................... 0.8378 

PUERTO RICO ............................. 0.4018 

RHODE ISLAND 1

SOUTH CAROLINA ...................... 0.8498 

SOUTH DAKOTA ......................... 0.8195 

TENNESSEE ................................ 0.7886 

TEXAS .......................................... 0.7780 

UTAH ............................................ 0.8974 

VERMONT .................................... 0.9307 

VIRGINIA ...................................... 0.8498 

VIRGIN ISLANDS ......................... 0.7195 

WASHINGTON ............................. 1.0388 

WEST VIRGINIA .......................... 0.8018 

WISCONSIN ................................. 0.9304 

Federal Register / Vol. 69, No. 106 / Wednesday, June 2, 2004 / Proposed Rules 31263

ADDENDUM A.—PROPOSED WAGE

INDEX FOR RURAL AREAS—APPLICABLE PRE-FLOOR AND PRE-RECLASSIFIED HOSPITAL WAGE INDEX—Continued

[CY 2005] 

MSA name Wage 

index 

WYOMING .................................... 0.9110 

1All counties within State are classified as 

Urban. 

ADDENDUM B.—PROPOSED CY 2005 

WAGE INDEX FOR URBAN AREAS—

PRE-FLOOR AND PRE-RECLASSIFIED

HOSPITAL WAGE INDEX

MSA Urban area (constituent 

counties) 

Wage 

index 

0040 .. Abilene, TX ...................... 0.7627 

Taylor, TX 

0060 .. Aguadilla, PR .................. 0.4306 

Aguada, PR 

Aguadilla, PR 

Moca, PR 

0080 .. Akron, OH ....................... 0.9246 

Portage, OH 

Summit, OH 

0120 .. Albany, GA ...................... 1.0863 

Dougherty, GA 

Lee, GA 

0160 .. Albany-SchenectadyTroy, NY.0.8489 

Albany, NY 

Montgomery, NY 

Rensselaer, NY 

Saratoga, NY 

Schenectady, NY 

Schoharie, NY 

0200 .. Albuquerque, NM ............ 0.9300 

Bernalillo, NM 

Sandoval, NM 

Valencia, NM 

0220 .. Alexandria, LA ................. 0.8019 

Rapides, LA 

0240 .. Allentown-BethlehemEaston, PA.0.9721 

Carbon, PA 

Lehigh, PA 

Northampton, PA 

0280 .. Altoona, PA ..................... 0.8806 

Blair, PA 

0320 .. Amarillo, TX, Potter, TX .. 0.8986 

Randall, TX 

0380 .. Anchorage, AK ................ 1.2216 

Anchorage, AK 

0440 .. Ann Arbor, MI .................. 1.1074 

Lenawee, MI 

Livingston, MI 

Washtenaw, MI 

0450 .. Anniston, AL .................... 0.8090 

Calhoun, AL 

0460 .. Appleton-OshkoshNeenah, WI.0.9035 

Calumet, WI 

Outagamie, WI 

Winnebago, WI 

0470 .. Arecibo, PR ..................... 0.4155 

Arecibo, PR 

Camuy, PR 

ADDENDUM B.—PROPOSED CY 2005 

WAGE INDEX FOR URBAN AREAS—

PRE-FLOOR AND PRE-RECLASSIFIED

HOSPITAL WAGE INDEX—Continued

MSA Urban area (constituent 

counties) 

Wage 

index 

Hatillo, PR 

0480 .. Asheville, NC ................... 0.9720 

Buncombe, NC 

Madison, NC 

0500 .. Athens, GA ...................... 0.9818 

Clarke, GA 

Madison, GA 

Oconee, GA 

0520 .. Atlanta, GA ...................... 1.0130 

Barrow, GA 

Bartow, GA 

Carroll, GA 

Cherokee, GA 

Clayton, GA 

Cobb, GA 

Coweta, GA 

DeKalb, GA 

Douglas, GA 

Fayette, GA 

Forsyth, GA 

Fulton, GA 

Gwinnett, GA 

Henry, GA 

Newton, GA 

Paulding, GA 

Pickens, GA 

Rockdale, GA 

Spalding, GA 

Walton, GA 

0560 .. Atlantic-Cape May, NJ .... 1.0795 

Atlantic, NJ 

Cape May, NJ 

0580 .. Auburn-Opelka, AL .......... 0.8494 

Lee, AL 

0600 .. Augusta-Aiken, GA–SC ... 0.9625 

Columbia, GA 

McDuffie, GA 

Richmond, GA 

Aiken, SC 

Edgefield, SC 

0640 .. Austin-San Marcos, TX ... 0.9609 

Bastrop, TX 

Caldwell, TX 

Hays, TX 

Travis, TX 

Williamson, TX 

0680 .. Bakersfield, CA ............... 0.9810 

Kern, CA 

0720 .. Baltimore, MD ................. 0.9919 

Anne Arundel, MD 

Baltimore City, MD 

Carroll, MD 

Harford, MD 

Howard, MD 

Queen Annes, MD 

0733 .. Bangor, ME ..................... 0.9904 

Penobscot, ME 

0743 .. Barnstable-Yarmouth, MA 1.2956 

Barnstable, MA 

0760 .. Baton Rouge, LA ............. 0.8406 

Ascension, LA 

East Baton Rouge, LA 

Livingston, LA 

West Baton Rouge, LA 

0840 .. Beaumont-Port Arthur, TX 0.8424 

Hardin, TX 

Jefferson, TX 

ADDENDUM B.—PROPOSED CY 2005 

WAGE INDEX FOR URBAN AREAS—

PRE-FLOOR AND PRE-RECLASSIFIED

HOSPITAL WAGE INDEX—Continued

MSA Urban area (constituent 

counties) 

Wage 

index 

Orange, TX 

0860 .. Bellingham, WA ............... 1.1757 

Whatcom, WA 

0870 .. Benton Harbor, MI ........... 0.8935 

Berrien, MI 

0875 .. Bergen-Passaic, NJ ........ 1.1692 

Bergen, NJ 

Passaic, NJ 

0880 .. Billings, MT ...................... 0.8961 

Yellowstone, MT 

0920 .. Biloxi-GulfportPascagoula, MS.0.9029 

Hancock, MS 

Harrison, MS 

Jackson, MS 

0960 .. Binghamton, NY .............. 0.8428 

Broome, NY 

Tioga, NY 

1000 .. Birmingham, AL. .............. 0.9212 

Blount, AL 

Jefferson, AL 

St. Clair, AL 

Shelby, AL 

1010 .. Bismarck, ND .................. 0.7965 

Burleigh, ND 

Morton, ND 

1020 .. Bloomington, IN ............... 0.8662 

Monroe, IN 

1040 .. Bloomington-Normal, IL .. 0.8832 

McLean, IL 

1080 .. Boise City, ID .................. 0.9209 

Ada, ID 

Canyon, ID 

1123 .. Boston-Worcester-Lawrence-Lowell-Brockton, 

MA–NH.

1.1233 

Bristol, MA 

Essex, MA 

Middlesex, MA 

Norfolk, MA 

Plymouth, MA 

Suffolk, MA 

Worcester, MA 

Hillsborough, NH 

Merrimack, NH 

Rockingham, NH 

Strafford, NH 

1125 .. Boulder-Longmont, CO ... 1.0049 

Boulder, CO 

1145 .. Brazoria, TX .................... 0.8137 

Brazoria, TX 

1150 .. Bremerton, WA ................ 1.0580 

Kitsap, WA 

1240 .. Brownsville-HarlingenSan Benito, TX.1.0303 

Cameron, TX.

1260 .. Bryan-College Station, TX 0.9019 

Brazos, TX 

1280 .. Buffalo-Niagara Falls, NY 0.9604 

Erie, NY 

Niagara, NY 

1303 .. Burlington, VT ................. 0.9704 

Chittenden, VT 

Franklin, VT 

Grand Isle, VT 

1310 .. Caguas, PR ..................... 0.4158

Caguas, PR 

31264 Federal Register / Vol. 69, No. 106 / Wednesday, June 2, 2004 / Proposed Rules 

ADDENDUM B.—PROPOSED CY 2005 

WAGE INDEX FOR URBAN AREAS—

PRE-FLOOR AND PRE-RECLASSIFIED

HOSPITAL WAGE INDEX—Continued

MSA Urban area (constituent 

counties) 

Wage 

index 

Cayey, PR 

Cidra, PR 

Gurabo, PR 

San Lorenzo, PR 

1320 .. Canton-Massillon, OH ..... 0.9071

Carroll, OH 

Stark, OH 

1350 .. Casper, WY ..................... 0.9095

Natrona, WY 

1360 .. Cedar Rapids, IA ............. 0.8874

Linn, IA 

1400 .. Champaign-Urbana, IL .... 0.9907

Champaign, IL 

1440 .. Charleston-North 

Charleston, SC.

0.9332

Berkeley, SC 

Charleston, SC 

Dorchester, SC 

1480 .. Charleston, WV ............... 0.8880

Kanawha, WV 

Putnam, WV 

1520 .. Charlotte-Gastonia-Rock 

Hill, NC–SC.

0.9730

Cabarrus, NC 

Gaston, NC 

Lincoln, NC 

Mecklenburg, NC 

Rowan, NC 

Stanley, NC 

Union, NC 

York, SC 

1540 .. Charlottesville, VA ........... 1.0025

Albemarle, VA 

Charlottesville City, VA 

Fluvanna, VA 

Greene, VA 

1560 .. Chattanooga, TN–GA ...... 0.9086

Catoosa, GA 

Dade, GA 

Walker, GA 

Hamilton, TN 

Marion, TN 

1580 .. Cheyenne, WY ................ 0.8796

Laramie, WY 

1600 .. Chicago, IL ...................... 1.0892

Cook, IL 

DeKalb, IL 

DuPage, IL 

Grundy, IL 

Kane, IL 

Kendall, IL 

Lake, IL 

McHenry, IL 

Will, IL 

1620 .. Chico-Paradise, CA ......... 1.0193

Butte, CA 

1640 .. Cincinnati, OH–KY–IN 0.9413 

Dearborn, IN 

Ohio, IN 

Boone, KY 

Campbell, KY 

Gallatin, KY 

Grant, KY 

Kenton, KY 

Pendleton, KY 

Brown, OH 

Clermont, OH 

ADDENDUM B.—PROPOSED CY 2005 

WAGE INDEX FOR URBAN AREAS—

PRE-FLOOR AND PRE-RECLASSIFIED

HOSPITAL WAGE INDEX—Continued

MSA Urban area (constituent 

counties) 

Wage 

index 

Hamilton, OH 

Warren, OH 

1660 .. Clarksville-Hopkinsville, 

TN–KY.

0.8244 

Christian, KY 

Montgomery, TN 

1680 .. Cleveland-Lorain-Elyria, 

OH.

0.9671 

Ashtabula, OH 

Cuyahoga, OH 

Geauga, OH 

Lake, OH 

Lorain, OH 

Medina, OH 

1720 .. Colorado Springs, CO ..... 0.9833 

El Paso, CO 

1740 .. Columbia, MO ................. 0.8695 

Boone, MO 

1760 .. Columbia, SC .................. 0.8902 

Lexington, SC 

Richland, SC 

1800 .. Columbus, GA–AL .......... 0.8694 

Russell, AL 

Chattahoochee, GA 

Harris, GA 

Muscogee, GA 

1840 .. Columbus, OH ................. 0.9648 

Delaware, OH 

Fairfield, OH 

Franklin, OH 

Licking, OH 

Madison, OH 

Pickaway, OH 

1880 .. Corpus Christi, TX ........... 0.8521 

Nueces, TX 

San Patricio, TX 

1890 .. Corvallis, OR ................... 1.1516 

Benton, OR 

1900 .. Cumberland, MD–WV ..... 0.8200 

Allegany, MD 

Mineral, WV 

1920 .. Dallas, TX ........................ 0.9974 

Collin, TX 

Dallas, TX 

Denton, TX 

Ellis, TX 

Henderson, TX 

Hunt, TX 

Kaufman, TX 

Rockwall, TX 

1950 .. Danville, VA ..................... 0.9035 

Danville City, VA 

Pittsylvania, VA 

1960 .. Davenport-Moline-Rock 

Island, IA–IL 

0.8985 

Scott, IA 

Henry, IL 

Rock Island, IL 

2000 .. Dayton-Springfield, OH ... 0.9518 

Clark, OH 

Greene, OH 

Miami, OH 

Montgomery, OH 

2020 .. Daytona Beach, FL ......... 0.9060 

Flagler, FL 

Volusia, FL 

2030 .. Dacatur, AL ..................... 0.8828 

ADDENDUM B.—PROPOSED CY 2005 

WAGE INDEX FOR URBAN AREAS—

PRE-FLOOR AND PRE-RECLASSIFIED

HOSPITAL WAGE INDEX—Continued

MSA Urban area (constituent 

counties) 

Wage 

index 

Lawrence, AL 

Morgan, AL 

2040 .. Dacatur, IL ....................... 0.8161 

Macon, IL 

2080 .. Denver, CO ..................... 1.0837 

Adams, CO 

Arapahoe, CO 

Denver, CO 

Douglas, CO 

Jefferson, CO 

2120 .. Des Moines, IA ................ 0.9106 

Dallas, IA ..............

Polk, IA 

Warren, IA 

2160 .. Detroit, MI ........................ 1.0101 

Lapeer, MI 

Macomb, MI 

Monroe, MI 

Oakland, MI 

St. Clair, MI 

Wayne, MI 

2180 .. Dothan, AL ...................... 0.7741 

Dale, AL 

Houston, AL 

2190 .. Dover, DE ........................ 0.9805 

Kent, DE 

2200 .. Dubuque, IA .................... 0.8886 

Dubuque, IA 

2240 .. Duluth-Superior, MN–WI 1.0171 

St. Louis, MN 

Douglas, WI 

2281 .. Dutchess County, NY ...... 1.0934 

Dutchess, NY 

2290 .. Eau Claire, WI ................. 0.9064 

Chippewa, WI 

Eau Claire, WI 

2320 .. El Paso, TX ..................... 0.9196 

El Paso, TX 

2330 .. Elkhart-Goshen, IN .......... 0.9783 

Elkhart, IN 

2335 .. Elmira, NY ....................... 0.8377 

Chemung, NY 

2340 .. Enid, OK .......................... 0.8559 

Garfield, OK 

2360 .. Erie, PA ........................... 0.8601 

Erie, PA 

2400 .. Eugene-Springfield, OR .. 1.1456 

Lane, OR 

2440 .. Evansville-Henderson, INKY.0.8429 

Posey, IN 

Vanderburgh, IN 

Warrick, IN 

Henderson, KY 

2520 .. Fargo-Moorhead, ND-MN 0.9797 

Clay, MN 

Cass, ND 

2560 .. Fayetteville, NC ............... 0.8986 

Cumberland, NC 

2580 .. Fayetteville-SpringdaleRogers, AR.0.8396 

Benton, AR 

Washington, AR 

2620 .. Flagstaff, AZ-UT .............. 1.1333 

Coconino, AZ 

Kane, UT 

2640 .. Flint, MI ........................... 1.0858 

Federal Register / Vol. 69, No. 106 / Wednesday, June 2, 2004 / Proposed Rules 31265

ADDENDUM B.—PROPOSED CY 2005 

WAGE INDEX FOR URBAN AREAS—

PRE-FLOOR AND PRE-RECLASSIFIED

HOSPITAL WAGE INDEX—Continued

MSA Urban area (constituent 

counties) 

Wage 

index 

Genesee, MI 

2650 .. Florence, AL .................... 0.7747 

Colbert, AL 

Lauderdale, AL 

2655 .. Florence, SC ................... 0.8709 

Florence, SC 

2670 .. Fort Collins-Loveland, CO 1.0108 

Larimer, CO 

2680 .. Ft. Lauderdale, FL ........... 1.0163 

Broward, FL 

2700 .. Fort Myers-Cape Coral, 

FL.

0.9816 

Lee, FL 

2710 .. Fort Pierce-Port St. Lucie, 

FL.

1.0008 

Martin, FL 

St. Lucie, FL 

2720 .. Fort Smith, AR-OK .......... 0.8424 

Crawford, AR 

Sebastian, AR 

Sequoyah, OK 

2750 .. Fort Walton Beach, FL .... 0.8966 

Okaloosa, FL 

2760 .. Fort Wayne, IN ................ 0.9585 

Adams, IN 

Allen, IN 

De Kalb, IN 

Huntington, IN 

Wells, IN 

Whitley, IN 

2800 .. Forth Worth-Arlington, TX 0.9359 

Hood, TX 

Johnson, TX 

Parker, TX 

Tarrant, TX 

2840 .. Fresno, CA ...................... 1.0142 

Fresno, CA 

Madera, CA 

2880 .. Gadsden, AL ................... 0.8206 

Etowah, AL 

2900 .. Gainesville, FL ................ 0.9693 

Alachua, FL 

2920 .. Galveston-Texas City, TX 0.9279 

Galveston, TX 

2960 .. Gary, IN ........................... 0.9410 

Lake, IN 

Porter, IN 

2975 .. Glens Falls, NY ............... 0.8475 

Warren, NY 

Washington, NY 

2980 .. Goldsboro, NC ................ 0.8622 

Wayne, NC 

2985 .. Grand Forks, ND–MN ..... 0.8636 

Polk, MN 

Grand Forks, ND 

2995 .. Grand Junction, CO ........ 0.9633 

Mesa, CO 

3000 .. Grand Rapids-MuskegonHolland, MI.0.9469 

Allegan, MI 

Kent, MI 

Muskegon, MI 

Ottawa, MI 

3040 .. Great Falls, MT ............... 0.8809 

Cascade, MT 

3060 .. Greeley, CO .................... 0.9372 

Weld, CO 

ADDENDUM B.—PROPOSED CY 2005 

WAGE INDEX FOR URBAN AREAS—

PRE-FLOOR AND PRE-RECLASSIFIED

HOSPITAL WAGE INDEX—Continued

MSA Urban area (constituent 

counties) 

Wage 

index 

3080 .. Green Bay, WI ................ 0.9461 

Brown, WI 

3120 .. Greensboro-WinstonSalem-High Point, NC.0.9166 

Alamance, NC 

Davidson, NC 

Davie, NC 

Forsyth, NC 

Guilford, NC 

Randolph, NC 

Stokes, NC 

Yadin, NC 

3150 .. Greenville, NC ................. 0.9098 

Pitt, NC 

3160 .. Greenville, SpartanburgAnderson, SC.0.9335 

Anderson, SC 

Cherokee, SC 

Greenville, SC 

Pickens, SC 

Spartanburg, SC 

3180 .. Hagerstown, MD ............. 0.9172 

Washington, MD 

3200 .. Hamilton-Middletown, OH 0.9214 

Butler, OH 

3240 .. Harrisburg-Lebanon-Carlisle, PA.0.9164 

Cumberland, PA 

Dauphin, PA 

Lebanon, PA 

Perry, PA 

3283 .. Hartford, CT .................... 1.1555 

Hartford, CT 

Litchfield, CT 

Middlesex, CT 

Tolland, CT 

3285 .. Hattiesburg, MS .............. 0.7307 

Forrest, MS 

Lamar, MS 

3290 .. Hickory-MorgantonLenoir, NC.0.9242 

Alexander, NC 

Burke, NC 

Caldwell, NC 

Catawaba, NC 

3320 .. Honolulu, HI .................... 1.1098 

Honolulu, HI 

3350 .. Houma, LA ...................... 0.7771 

Lafourche, LA 

Terrebonne, LA 

3360 .. Houston, TX .................... 0.9834 

Chambers, TX 

Fort Bend, TX 

Harris, TX 

Liberty, TX 

Montgomery, TX 

Waller, TX 

3400 .. Huntington-Ashland, WV–

KY–OH.

0.9595 

Boyd, KY 

Carter, KY 

Grenup, KY 

Lawrence, OH 

Cabell, WV 

Wayne, WV 

3440 .. Huntsville, AL .................. 0.9245 

Limestone, AL 

ADDENDUM B.—PROPOSED CY 2005 

WAGE INDEX FOR URBAN AREAS—

PRE-FLOOR AND PRE-RECLASSIFIED

HOSPITAL WAGE INDEX—Continued

MSA Urban area (constituent 

counties) 

Wage 

index 

Madison, AL 

3480 .. Indianapolis, IN ............... 0.9916 

Boone, IN 

Hamilton, IN 

Hancoock, IN 

Hendricks, IN 

Johnson, IN 

Madison, IN 

Marion, IN 

Morgan, IN 

Shelby, IN 

3500 .. Iowa City, IA .................... 0.9548 

Johnson, IA 

3520 .. Jackson, MI ..................... 0.8986 

Jackson, MI 

3560 .. Jackson, MS .................... 0.8357 

Hinds, MS 

Madison, MS 

Rankin MS 

3580 .. Jackson, TN .................... 0.8984 

Madison, TN 

Chester, TN 

3600 .. Jacksonville, FL ............... 10.9529 

Clay, FL 

Duval, FL 

Nassau, FL 

St. Johns, FL 

3605 .. Jacksonville, NC .............. 0.8544 

Onslow, NC 

3610 .. Jamestown, NY ............... 0.7762 

Chautauqua, NY 

3620 .. Janesville-Beloit, WI ........ 0.9282 

Rock, WI 

3640 .. Jersey City, NJ ................ 1.1115 

Hudson, NJ 

3660 .. Johnson City-KingsportBristol, TN–VA.0.8253 

Carter, TN.

Hawkins, TN 

Sullivan, TN 

Unicoi, TN 

Washington, TN 

Bristol City, VA 

Scott, VA 

Washington, VA 

3680 .. Johnstown, PA ................ 0.8158 

Cambria, PA 

Somerset, PA 

3700 .. Jonesboro, AR ................ 0.7794 

Craighead, AR 

3710 .. Joplin, MO ....................... 0.8681 

Jasper, MO 

Newton, MO 

3720 .. Kalamazoo-Battlecreek, 

MI 

1.0500 

Calhoun, MI 

Kalamazoo, MI 

Van Buren, MI 

3740 .. Kankakee, IL ................... 1.0419 

Kankakee, IL 

3760 .. Kansas City, KS–MO ...... 0.9715 

Johnson, KS 

Leavenworth, KS 

Miami, KS 

Wyandotte, KS 

Cass, MO 

Clay, MO 

31266 Federal Register / Vol. 69, No. 106 / Wednesday, June 2, 2004 / Proposed Rules 

ADDENDUM B.—PROPOSED CY 2005 

WAGE INDEX FOR URBAN AREAS—

PRE-FLOOR AND PRE-RECLASSIFIED

HOSPITAL WAGE INDEX—Continued

MSA Urban area (constituent 

counties) 

Wage 

index 

Clinton, MO 

Jackson, MO 

Lafayette, MO 

Platte, MO 

Ray, MO 

3800 .. Kenosha, WI .................... 0.9761 

Kenosha, WI 

3810 .. Killeen-Temple, TX .......... 0.9159 

Bell, TX 

Coryell, TX 

3840 .. Knoxville, TN ................... 0.8820 

Anderson, TN 

Blount, TN 

Knox, TN 

Loudon, TN 

Sevier, TN 

Union, TN 

3850 .. Kokomo, IN ..................... 0.9045

Howard, IN 

Tipton, IN 

3870 .. La Crosse, WI–MN .......... 0.9247

Houston, MN 

La Crosse, WI 

3880 .. Lafayette, LA ................... 0.8207

Acadia, LA 

Lafayette, LA 

St. Landry, LA 

St. Martin, LA 

3920 .. Lafayette, IN .................... 0.9036

Clinton, IN 

Tippecanoe, IN 

3960 .. Lake Charles, LA ............ 0.7841

Calcasieu, LA 

3980 .. Lakeland-Winter Haven, 

FL.

0.8811

Polk, FL 

4000 .. Lancaster, PA .................. 0.9282

Lancaster, PA 

4040 .. Lansing-East Lansing, MI 0.9714

Clinton, MI 

Eaton, MI 

Ingham, MI 

4080 .. Laredo, TX ...................... 0.8091

Webb, TX 

4100 .. Las Cruces, NM .............. 0.8688

Dona Ana, NM 

4120 .. Las Vegas, NV–AZ ......... 1.1528

Mohave, AZ 

Clark, NV 

Nye, NV 

4150 .. Lawrence, KS .................. 0.8074

Douglas, KS 

4200 .. Lawton, OK ..................... 0.8267

Comanche, OK 

4243 .. Lewiston-Auburn, ME ...... 0.9383

Androscoggin, ME 

4280 .. Lexington, KY .................. 0.8685

Bourbon, KY 

Clark, KY 

Fayette, KY 

Jessamine, KY 

Madison, KY 

Scott, KY 

Woodford, KY 

4320 .. Lima, OH ......................... 0.9522

Allen, OH 

Auglaize, OH 

ADDENDUM B.—PROPOSED CY 2005 

WAGE INDEX FOR URBAN AREAS—

PRE-FLOOR AND PRE-RECLASSIFIED

HOSPITAL WAGE INDEX—Continued

MSA Urban area (constituent 

counties) 

Wage 

index 

4360 .. Lincoln, NE ...................... 1.0033

Lancaster, NE 

4400 .. Little Rock-North Little 

Rock, AR.

0.8923

Faulkner, AR 

Lonoke, AR 

Pulaski, AR 

Saline, AR 

4420 .. Longview-Marshall, TX .... 0.9113 

Gregg, TX 

Harrison, TX 

Upshur, TX 

4480 .. Los Angeles-Long Beach, 

CA.

1.1795 

Los Angeles, CA 

4520 .. Louisville, KY–IN ............. 0.9242 

Clark, IN 

Floyd, IN 

Harrison, IN 

Scott, IN 

Bullitt, KY 

Jefferson, KY 

Oldham, KY 

4600 .. Lubbock, TX .................... 0.8272 

Lubbock, TX 

4640 .. Lynchburg, VA ................. 0.9134 

Amherst, VA 

Bedford, VA 

Bedford City, VA 

Campbell, VA 

Lynchburg City, VA 

4680 .. Macon, GA ...................... 0.8953 

Bibb, GA 

Houston, GA 

Jones, GA 

Peach, GA 

Twiggs, GA 

4720 .. Madison, WI .................... 1.0264 

Dane, WI 

4800 .. Mansfield, OH ................. 0.9180 

Crawford, OH 

Richland, OH 

4840 .. Mayaguez, PR ................. 0.4795 

Anasco, PR 

Cabo Rojo, PR 

Hormigueros, PR 

Mayaguez, PR 

Sabana Grande, PR 

San German, PR 

4880 .. McAllen-Edinburg-Mission, TX.0.8381 

Hidalgo, TX 

4890 .. Medford-Ashland, OR ..... 1.0772 

Jackson, OR 

4900 .. Melbourne-Titusville-Palm 

Bay, FL.

0.9776 

Brevard, FL 

4920 .. Memphis, TN–AR–MS .... 0.9009 

Crittenden, AR 

DeSoto, MS 

Fayette, TN 

Shelby, TN 

Tipton, TN 

4940 .. Merced, CA ..................... 0.9692 

Merced, CA 

5000 .. Miami, FL ........................ 0.9894 

Dade, FL 

ADDENDUM B.—PROPOSED CY 2005 

WAGE INDEX FOR URBAN AREAS—

PRE-FLOOR AND PRE-RECLASSIFIED

HOSPITAL WAGE INDEX—Continued

MSA Urban area (constituent 

counties) 

Wage 

index 

5015 .. Middlesex-SomersetHunterdon, NJ.1.1366 

Hunterdon, NJ 

Middlesex, NJ 

Somerset, NJ 

5080 .. Milwaukee-Waukesha, WI 0.9988 

Milwaukee, WI 

Ozaukee, WI 

Washington, WI 

Waukesha, WI 

5120 .. Minneapolis-St. Paul, 

MN–WI.

1.1001 

Anoka, MN 

Carver, MN 

Chisago, MN 

Dakota, MN 

Hennepin, MN 

Isanti, MN 

Ramsey, MN 

Scott, MN 

Sherburne, MN 

Washington, MN 

Wright, MN 

Pierce, WI 

St. Croix, WI 

5140 .. Missoula, MT ................... 0.8718 

Missoula, MT 

5160 .. Mobile, AL ....................... 0.7994 

Baldwin, AL 

Mobile, AL 

5170 .. Modesto, CA ................... 1.1275 

Stanislaus, CA 

5190 .. Monmouth-Ocean, NJ ..... 1.0956 

Monmouth, NJ 

Ocean, NJ 

5200 .. Monroe, LA ...................... 0.7922 

Ouachita, LA 

5240 .. Montgomery, AL. ............. 0.7907 

Autauga, AL 

Elmore, AL 

Montgomery, AL 

5280 .. Muncie, IN ....................... 0.8775 

Delaware, IN 

5330 .. Myrtle Beach, SC ............ 0.9112 

Horry, SC 

5345 .. Naples, FL ....................... 0.9790 

Collier, FL 

5360 .. Nashville, TN ................... 0.9855 

Cheatham, TN 

Davidson, TN 

Dickson, TN 

Robertson, TN 

Rutherford, TN 

Sumner, TN 

Williamson, TN 

Wilson, TN 

5380 .. Nassau-Suffolk, NY ......... 1.3140 

Nassau, NY 

Suffolk, NY 

5483 .. New Haven-BridgeportStamford-WaterburyDanbury, CT.1.2385 

Fairfield, CT 

New Haven, CT 

5523 .. New London-Norwich, 

CT....

1.1631 

New London, CT 

Federal Register / Vol. 69, No. 106 / Wednesday, June 2, 2004 / Proposed Rules 31267

ADDENDUM B.—PROPOSED CY 2005 

WAGE INDEX FOR URBAN AREAS—

PRE-FLOOR AND PRE-RECLASSIFIED

HOSPITAL WAGE INDEX—Continued

MSA Urban area (constituent 

counties) 

Wage 

index 

5560 .. New Orleans, LA ............. 0.9174 

Jefferson, LA 

Orleans, LA 

Plaquemines, LA 

St. Bernard, LA 

St. Charles, LA 

St. James, LA 

St. John The Baptist, LA 

St. Tammany, LA 

5600 .. New York, NY ................. 1.4018 

Bronx, NY 

Kings, NY 

New York, NY 

Putnam, NY 

Queens, NY 

Richmond, NY 

Rockland, NY 

Westchester, NY 

5640 .. Newark, NJ ...................... 1.1518 

Essex, NJ 

Morris, NJ 

Sussex, NJ 

Union, NJ 

Warren, NJ 

5660 .. Newburgh, NY—PA ........ 1.1509 

Orange, NY 

Pike, PA 

5720 .. Norfolk-Virginia BeachNewport News, VA-NC.0.8619 

Currituck, NC 

Chesapeake City, VA 

Gloucester, VA 

Hampton City, VA 

Isle of Wight, VA 

James City, VA 

Mathews, VA 

Newport News City, VA 

Norfolk City, VA 

Poquoson City, VA 

Portsmouth City, VA 

Suffolk City, VA 

Virginia Beach City, VA 

Williamsburg City, VA 

York, VA 

5775 .. Oakland, CA .................... 1.4921 

Alameda, CA 

Contra Costa, CA 

5790 .. Ocala, FL ......................... 0.9728 

Marion, FL 

5800 .. Odessa-Midland, TX ....... 0.9327 

Ector, TX 

Midland, TX 

5880 .. Oklahoma City, OK ......... 0.8984 

Canadian, OK 

Cleveland, OK 

Logan, OK 

McClain, OK 

Oklahoma, OK 

Pottawatomie, OK 

5910 .. Olympia, WA ................... 1.0963 

Thurston, WA 

5920 .. Omaha, NE–IA ................ 0.9745 

Pottawattamie, IA 

Cass, NE 

Douglas, NE 

Sarpy, NE 

Washington, NE 

ADDENDUM B.—PROPOSED CY 2005 

WAGE INDEX FOR URBAN AREAS—

PRE-FLOOR AND PRE-RECLASSIFIED

HOSPITAL WAGE INDEX—Continued

MSA Urban area (constituent 

counties) 

Wage 

index 

5945 .. Orange County, CA ......... 1.1372 

Orange, CA 

5960 .. Orlando, FL ..................... 0.9654 

Lake, FL 

Orange, FL 

Osceola, FL 

Seminole, FL 

5990 .. Owensboro, KY ............... 0.8374 

Daviess, KY 

6015 .. Panama City, FL ............. 0.8202 

Bay, FL 

6020 .. Parkersburg-Marietta, 

WV–OH.

0.8039 

Washington, OH 

Wood, WV 

6080 .. Pensacola, FL ................. 0.8753 

Escambia, FL 

Santa Rosa, FL 

6120 .. Peoria-Pekin, IL ............... 0.8734 

Peoria, IL 

Tazewell, IL 

Woodford, IL 

6160 .. Philadelphia, PA–NJ ....... 1.0883 

Burlington, NJ 

Camden, NJ 

Gloucester, NJ 

Salem, NJ 

Bucks, PA 

Chester, PA 

Delaware, PA 

Mongtomery, PA 

Philadelphia, PA 

6200 .. Phoenix-Mesa, AZ ........... 1.0129 

Maricopa, AZ 

Pinal, AZ 

6240 .. Pine Bluff, AR .................. 0.7865 

Jefferson, AR 

6280 .. Pittsburgh, PA ................. 0.8901 

Allegheny, PA 

Beaver, PA 

Butler, PA 

Fayette, PA 

Washington, PA 

Westmoreland, PA 

6323 .. Pittsfield, MA ................... 1.0276 

Berkshire, MA 

6340 .. Pocatello, ID .................... 0.9042 

Bannock, ID 

6360 .. Ponce, PR ....................... 0.4708 

Guayanilla, PR 

Juana Diaz, PR 

Penuelas, PR 

Ponce, PR 

Villalba, PR 

Yauco, PR 

6403 .. Portland, ME ................... 0.9949 

Cumberland, ME 

Sagadahoc, ME 

York, ME 

6440 .. Portland-Vancouver, OR–

WA.

1.1213 

Clackamas, OR 

Columbia, OR 

Multnomah, OR 

Washington, OR 

Yamhill, OR 

Clark, WA 

ADDENDUM B.—PROPOSED CY 2005 

WAGE INDEX FOR URBAN AREAS—

PRE-FLOOR AND PRE-RECLASSIFIED

HOSPITAL WAGE INDEX—Continued

MSA Urban area (constituent 

counties) 

Wage 

index 

6483 .. Providence-WarwickPawtucket, RI.1.0977 

Bristol, RI 

Kent, RI 

Newport, RI 

Providence, RI 

Washington, RI 

6520 .. Provo-Orem, UT .............. 0.9976 

Utah, UT 

6560 .. Pueblo, CO ...................... 0.8778 

Pueblo, CO 

6580 .. Punta Gorda, FL ............. 0.9510 

Charlotte, FL 

6600 .. Racine, WI ....................... 0.8814 

Racine, WI 

6640 .. Raleigh-Durham-Chapel 

Hill, NC.

0.9959 

Chatham, NC 

Durham, NC 

Franklin, NC 

Johnston, NC 

Orange, NC 

Wake, NC 

6660 .. Rapid City, SD ................ 0.8806 

Pennington, SD 

6680 .. Reading, PA .................... 0.9133 

Berks, PA 

6690 .. Redding, CA .................... 1.1352 

Shasta, CA 

6720 .. Reno, NV ......................... 1.0682 

Washoe, NV 

6740 .. Richland-KennewickPasco, WA.1.0609 

Benton, WA 

Franklin, WA 

6760 .. Richmond-Petersburg, VA 0.9349 

Charles City County, VA 

Chesterfield, VA 

Colonia Heights City, VA 

Dinwiddie, VA 

Goochland, VA 

Hanover, VA 

Henrico, VA 

Hopewell City, VA 

New Kent, VA 

Petersburg City, VA 

Powhatan, VA 

Prince George, VA 

Richmond City, VA 

6780 .. Riverside-San 

Bernardino, CA.

1.1348 

Riverside, CA 

San Bernardino, CA 

6800 .. Roanoke, VA ................... 0.8700 

Botetourt, VA 

Roanoke, VA 

Roanoke City, VA 

Salem City, VA 

6820 .. Rochester, MN ................ 1.1739 

Olmsted, MN 

6840 .. Rochester, NY ................. 0.9430 

Genesee, NY 

Livingston, NY 

Monroe, NY 

Ontario, NY 

Orleans, NY 

Wayne, NY 

31268 Federal Register / Vol. 69, No. 106 / Wednesday, June 2, 2004 / Proposed Rules 

ADDENDUM B.—PROPOSED CY 2005 

WAGE INDEX FOR URBAN AREAS—

PRE-FLOOR AND PRE-RECLASSIFIED

HOSPITAL WAGE INDEX—Continued

MSA Urban area (constituent 

counties) 

Wage 

index 

6880 .. Rockford, IL ..................... 0.9666 

Boone, IL 

Ogle, IL 

Winnebago, IL 

6895 .. Rocky Mount, NC ............ 0.9076 

Edgecombe, NC 

Nash, NC 

6920 .. Sacramento, CA .............. 1.1845 

El Dorado, CA 

Placer, CA 

Sacramento, CA 

6960 .. Saginaw-Bay City-Midland, MI.1.0032 

Bay, MI 

Midland, MI 

Saginaw, MI 

6980 .. St. Cloud, MN .................. 0.9506 

Benton, MN 

Stearns, MN 

7000 .. St. Joseph, MO ............... 0.8056 

Andrew, MO 

Buchanan, MO 

7040 .. St. Louis, MO–IL ............. 0.9033 

Clinton, IL 

Jersey, IL 

Madison, IL 

Monroe, IL 

St. Clair, IL 

Franklin, MO 

Jefferson, MO 

Lincoln, MO 

St. Charles, MO 

St. Louis, MO 

St. Louis City, MO 

Warren, MO 

7080 .. Salem, OR ....................... 1.0482 

Marion, OR 

Polk, OR 

7120 .. Salinas, CA ..................... 1.4339 

Monterey, CA 

7160 .. Salt Lake City-Ogden, UT 0.9913 

Davis, UT 

Salt Lake, UT 

Weber, UT 

7200 .. San Angelo, TX ............... 0.8535 

Tom Green, TX 

7240 .. San Antonio, TX .............. 0.8870 

Bexar, TX 

Comal, TX 

Guadalupe, TX 

Wilson, TX 

7320 .. San Diego, CA ................ 1.1147 

San Diego, CA 

7360 .. San Francisco, CA .......... 1.4514 

Marin, CA 

San Francisco, CA 

San Mateo, CA 

7400 .. San Jose, CA .................. 1.4626 

Santa Clara, CA 

7440 .. San Juan-Bayamon, PR 0.4909 

Aguas Buenas, PR 

Barceloneta, PR 

Bayamon, PR 

Canovanas, PR 

Carolina, PR 

Catano, PR 

Ceiba, PR 

ADDENDUM B.—PROPOSED CY 2005 

WAGE INDEX FOR URBAN AREAS—

PRE-FLOOR AND PRE-RECLASSIFIED

HOSPITAL WAGE INDEX—Continued

MSA Urban area (constituent 

counties) 

Wage 

index 

Comerio, PR 

Corozal, PR 

Dorado, PR 

Fajardo, PR 

Florida, PR 

Guaynabo, PR 

Humacao, PR 

Juncos, PR 

Los Piedras, PR 

Loiza, PR 

Luguillo, PR 

Manati, PR 

Morovis, PR 

Naguabo, PR 

Naranjito, PR 

Rio Grande, PR 

San Juan, PR 

Toa Alta, PR 

Toa Baja, PR 

Trujillo Alto, PR 

Vega Alta, PR 

Vega Baja, PR 

Yabucoa, PR 

7460 .. San Luis ObispoAtascadero-Paso.1.1429 

Robles, CA 

San Luis Obispo, CA 

7480 .. Santa Barbara-Santa 

Maria-Lompoc, CA 

1.0441

Santa Barbara, CA 

7485 .. Santa Cruz-Watsonville, 

CA 

1.2942

Santa Cruz, CA 

7490 .. Santa Fe, NM .................. 1.0653

Los Alamos, NM 

Santa Fe, NM 

7500 .. Santa Rosa, CA .............. 1.2877

Sonoma, CA 

7510 .. Sarasota-Bradenton, FL .. 0.9964

Manatee, FL 

Sarasota, FL 

7520 .. Savannah, GA ................. 0.9472

Bryan, GA 

Chatham, GA 

Effingham, GA 

7560 .. Scranton-Wilkes-BarreHazleton, PA 0.8412

Columbia, PA 

Lackawanna, PA 

Luzerne, PA 

Wyoming, PA 

7600 .. Seattle-Bellevue-Everett, 

WA 

1.1562

Island, WA 

King, WA 

Snohomish, WA 

7610 .. Sharon, PA ...................... 0.7751

Mercer, PA 

7620 .. Sheboygan, WI ................ 0.8624

Sheboygan, WI 

7640 .. Sherman-Denison, TX ..... 0.9700

Grayson, TX 

7680 .. Shreveport-Bossier City, 

LA 

0.9083

Bossier, LA 

Caddo, LA 

Webster, LA 

ADDENDUM B.—PROPOSED CY 2005 

WAGE INDEX FOR URBAN AREAS—

PRE-FLOOR AND PRE-RECLASSIFIED

HOSPITAL WAGE INDEX—Continued

MSA Urban area (constituent 

counties) 

Wage 

index 

7720 .. Sioux City, IA–NE ........... 0.8993

Woodbury, IA 

Dakota, NE 

7760 .. Sioux Falls, SD ............... 0.9309

Lincoln, SD 

Minnehaha, SD 

7800 .. South Bend, IN ................ 0.9821

St. Joseph, IN 

7840 .. Spokane, WA .................. 1.0901

Spokane, WA 

7880 .. Springfield, IL .................. 0.8944

Menard, IL 

Sangamon, IL 

7920 .. Springfield, MO ............... 0.8457

Christian, MO 

Greene, MO 

Webster, MO 

8003 .. Springfield, MA ................ 1.0543

Hampden, MA 

Hampshire, MA 

8050 .. State College, PA ............ 0.8740

Centre, PA 

8080 .. Steubenville-Weirton, 

OH–WV 

0.8398

Jefferson, OH 

Brooke, WV 

Hancock, WV 

8120 .. Stockton-Lodi, CA ........... 1.0404 

San Joaquin, CA 

8140 .. Sumter, SC ...................... 0.8243 

Sumter, SC 

8160 .. Syracuse, NY .................. 0.9412 

Cayuga, NY 

Madison, NY 

Onondaga, NY 

Oswego, NY 

8200 .. Tacoma, WA ................... 1.1116 

Pierce, WA 

8240 .. Tallahassee, FL ............... 0.8520 

Gadsden, FL 

Leon, FL 

8280 .. Tampa-St. PetersburgClearwater, FL.0.9103 

Hernando, FL 

Hillsborough, FL 

Pasco, FL 

Pinellas, FL 

8320 .. Terre Haute, IN ............... 0.8325 

Clay, IN 

Vermillion, IN 

Vigo, IN 

8360 .. Texarkana, AR-Texarkana, TX.0.8150 

Miller, AR 

Bowie, TX 

8400 .. Toledo, OH ...................... 0.9381 

Fulton, OH 

Lucas, OH 

Wood, OH 

8440 .. Topeka, KS ..................... 0.9108 

Shawnee, KS 

8480 .. Trenton, NJ ..................... 1.0517 

Mercer, NJ 

8520 .. Tucson, AZ ...................... 0.8981 

Pima, AZ 

8560 .. Tulsa, OK ........................ 0.9185 

Creek, OK 

Federal Register / Vol. 69, No. 106 / Wednesday, June 2, 2004 / Proposed Rules 31269

ADDENDUM B.—PROPOSED CY 2005 

WAGE INDEX FOR URBAN AREAS—

PRE-FLOOR AND PRE-RECLASSIFIED

HOSPITAL WAGE INDEX—Continued

MSA Urban area (constituent 

counties) 

Wage 

index 

Osage, OK 

Rogers, OK 

Tulsa, OK 

Wagoner, OK 

8600 .. Tuscaloosa, AL ............... 0.8212 

Tuscaloosa, AL 

8640 .. Tyler, TX .......................... 0.9404 

Smith, TX 

8680 .. Utica-Rome, NY .............. 0.8403 

Herkimer, NY 

Oneida, NY 

8720 .. Vallejo-Fairfield-Napa, CA 1.3377 

Napa, CA 

Solano, CA 

8735 .. Ventura, CA ..................... 1.1064 

Ventura, CA 

8750 .. Victoria, TX ...................... 0.8184 

Victoria, TX 

8760 .. Vineland-Millville-Bridgeton, NJ.1.0405 

Cumberland, NJ 

8780 .. Visalia-Tulare-Porterville, 

CA.

0.9856 

Tulare, CA 

8800 .. Waco, TX ........................ 0.8394 

McLennan, TX 

8840 .. Washington, DC–MD–

VA–WV.

1.0904 

District of Columbia, DC 

Calvert, MD 

Charles, MD 

Frederick, MD 

ADDENDUM B.—PROPOSED CY 2005 

WAGE INDEX FOR URBAN AREAS—

PRE-FLOOR AND PRE-RECLASSIFIED

HOSPITAL WAGE INDEX—Continued

MSA Urban area (constituent 

counties) 

Wage 

index 

Montgomery, MD 

Prince Georges, MD 

Alexandria City, VA 

Arlington, VA 

Clarke, VA 

Culpeper, VA 

Fairfax, VA 

Fairfax City, VA 

Falls Church City, VA 

Fauquier, VA 

Fredericksburg City, VA 

King George, VA 

Loudoun, VA 

Manassas City, VA 

Manassas Park City, VA 

Prince William, VA 

Spotsylvania, VA 

Stafford, VA 

Warren, VA 

Berkeley, WV 

Jefferson, WV 

8920 .. Waterloo-Cedar Falls, IA 0.8366 

Black Hawk, IA 

8940 .. Wausau, WI ..................... 0.9692 

Marathon, WI 

8960 .. West Palm Beach-Boca 

Raton, FL.

0.9798 

Palm Beach, FL 

9000 .. Wheeling, WV–OH .......... 0.7494 

Belmont, OH 

Marshall, WV 

Ohio, WV 

ADDENDUM B.—PROPOSED CY 2005 

WAGE INDEX FOR URBAN AREAS—

PRE-FLOOR AND PRE-RECLASSIFIED

HOSPITAL WAGE INDEX—Continued

MSA Urban area (constituent 

counties) 

Wage 

index 

9040 .. Wichita, KS ...................... 0.9238 

Butler, KS 

Harvey, KS 

Sedgwick, KS 

9080 .. Wichita Falls, TX ............. 0.8341 

Archer, TX 

Wichita, TX 

9140 .. Williamsport, PA .............. 0.8158 

Lycoming, PA 

9160 .. Wilmington-Newark, DE–

MD.

1.0882 

New Castle, DE 

Cecil, MD 

9200 .. Wilmington, NC ............... 0.9563 

New Hanover, NC 

Brunswick, NC 

9260 .. Yakima, WA .................... 1.0372 

Yakima, WA 

9270 .. Yolo, CA .......................... 0.9204 

Yolo, CA 

9280 .. York, PA .......................... 0.9119 

York, PA 

9320 .. Youngstown-Warren, OH 0.9214 

Columbiana, OH 

Mahoning, OH 

Trumbull, OH 

9340 .. Yuba City, CA ................. 1.0196 

Sutter, CA 

Yuba, CA 

9360 .. Yuma, AZ ........................ 0.8895 

Yuma, AZ 

ADDENDUM C.—COMPARISON OF PRE-FLOOR AND PRE-RECLASSIFIED HOSPITAL WAGE INDEX FOR FY 2003 AND

PROPOSED CY 2005 

Rural area 

FY 2003 

wage 

index 

Proposed 

CY 2005 

wage 

index 

Percent 

change, 

FY 

2003—

proposed 

CY 2005 

ALABAMA ............................................................................................................................................................ 0.766 0.7492 ¥2.19 

ALASKA ............................................................................................................................................................... 1.2293 1.1886 ¥3.31 

ARIZONA ............................................................................................................................................................. 0.8493 0.9270 9.15 

ARKANSAS ......................................................................................................................................................... 0.7666 0.7734 0.89 

CALIFORNIA ....................................................................................................................................................... 0.9840 0.9967 1.29 

COLORADO ........................................................................................................................................................ 0.9015 0.9328 3.47 

CONNECTICUT ................................................................................................................................................... 1.2394 1.2183 ¥1.70 

DELAWARE ......................................................................................................................................................... 0.9128 0.9557 4.70 

FLORIDA ............................................................................................................................................................. 0.8814 0.8855 0.47 

GEORGIA ............................................................................................................................................................ 0.8230 0.8369 1.69 

GUAM .................................................................................................................................................................. 0.9611 0.9611 

HAWAII ................................................................................................................................................................ 1.0255 0.9958 ¥2.90 

IDAHO .................................................................................................................................................................. 0.8747 0.8974 2.60 

ILLINOIS .............................................................................................................................................................. 0.8204 0.8254 0.61 

INDIANA .............................................................................................................................................................. 0.8755 0.8824 0.79 

IOWA ................................................................................................................................................................... 0.8315 0.8416 1.21 

KANSAS .............................................................................................................................................................. 0.7923 0.8074 1.91 

KENTUCKY ......................................................................................................................................................... 0.8079 0.7973 ¥1.31 

LOUISIANA .......................................................................................................................................................... 0.7567 0.7451 ¥1.53 

MAINE .................................................................................................................................................................. 0.8874 0.8812 ¥0.70 

MARYLAND ......................................................................................................................................................... 0.8946 0.9125 2.00 

MASSACHUSETTS ............................................................................................................................................. 1.1288 1.0432 ¥7.58 

MICHIGAN ........................................................................................................................................................... 0.9000 0.8877 ¥1.37 

MINNESOTA ........................................................................................................................................................ 0.9151 0.9330 1.96 

MISSISSIPPI ........................................................................................................................................................ 0.7680 0.7778 1.28 

31270 Federal Register / Vol. 69, No. 106 / Wednesday, June 2, 2004 / Proposed Rules 

ADDENDUM C.—COMPARISON OF PRE-FLOOR AND PRE-RECLASSIFIED HOSPITAL WAGE INDEX FOR FY 2003 AND

PROPOSED CY 2005—Continued

Rural area 

FY 2003 

wage 

index 

Proposed 

CY 2005 

wage 

index 

Percent 

change, 

FY 

2003—

proposed 

CY 2005 

MISSOURI ........................................................................................................................................................... 0.8021 0.8056 0.44 

MONTANA ........................................................................................................................................................... 0.8481 0.8800 3.76 

NEBRASKA ......................................................................................................................................................... 0.8204 0.8822 7.53 

NEVADA .............................................................................................................................................................. 0.9577 0.9806 2.39 

NEW HAMPSHIRE .............................................................................................................................................. 0.9796 1.0030 2.39 

NEW JERSEY ..................................................................................................................................................... ................ ................ ................

NEW MEXICO ..................................................................................................................................................... 0.8872 0.8270 ¥6.79 

NEW YORK ......................................................................................................................................................... 0.8542 0.8526 ¥0.19 

NORTH CAROLINA ............................................................................................................................................. 0.8666 0.8456 ¥2.42 

NORTH DAKOTA ................................................................................................................................................ 0.7788 0.7778 ¥0.13 

OHIO .................................................................................................................................................................... 0.8613 0.8820 2.40 

OKLAHOMA ......................................................................................................................................................... 0.7590 0.7537 ¥0.70 

OREGON ............................................................................................................................................................. 1.0303 0.9994 ¥3.00 

PENNSYLVANIA ................................................................................................................................................. 0.8462 0.8378 ¥0.99 

PUERTO RICO .................................................................................................................................................... 0.4356 0.4018 ¥7.76 

RHODE ISLAND .................................................................................................................................................. ................ ................ ................

SOUTH CAROLINA ............................................................................................................................................. 0.8607 0.8498 ¥1.27 

SOUTH DAKOTA ................................................................................................................................................ 0.7815 0.8195 4.86 

TENNESSEE ....................................................................................................................................................... 0.7877 0.7886 0.11 

TEXAS ................................................................................................................................................................. 0.7821 0.7780 ¥0.52 

UTAH ................................................................................................................................................................... 0.9312 0.8974 ¥3.63 

VERMONT ........................................................................................................................................................... 0.9345 0.9307 ¥0.41 

VIRGINIA ............................................................................................................................................................. 0.8504 0.8498 ¥0.07 

VIRGIN ISLANDS ................................................................................................................................................ 0.7845 0.7195 ¥8.29 

WASHINGTON .................................................................................................................................................... 1.0179 1.0388 2.05 

WEST VIRGINIA .................................................................................................................................................. 0.7975 0.8018 0.54 

WISCONSIN ........................................................................................................................................................ 0.9162 0.9304 1.55 

WYOMING ........................................................................................................................................................... 0.9007 0.9110 1.14 

Urban MSA FY 2003 

wage index 

Proposed 

CY 2005 

wage index 

Percent 

change, FY 

2003—proposed CY 

2005 

0040 ......................................................................................................................................................... 0.7792 0.7627 ¥2.12 

0060 ......................................................................................................................................................... 0.4587 0.4306 ¥6.13 

0080 ......................................................................................................................................................... 0.9600 0.9246 ¥3.69 

0120 ......................................................................................................................................................... 1.0594 1.0863 2.54 

0160 ......................................................................................................................................................... 0.8384 0.8489 1.25 

0200 ......................................................................................................................................................... 0.9315 0.9300 ¥0.16 

0220 ......................................................................................................................................................... 0.7859 0.8019 2.04 

0240 ......................................................................................................................................................... 0.9735 0.9721 ¥0.14 

0280 ......................................................................................................................................................... 0.9225 0.8806 ¥4.54 

0320 ......................................................................................................................................................... 0.9034 0.8986 ¥0.53 

0380 ......................................................................................................................................................... 1.2358 1.2216 ¥1.15 

0440 ......................................................................................................................................................... 1.1103 1.1074 ¥0.26 

0450 ......................................................................................................................................................... 0.8044 0.8090 0.57 

0460 ......................................................................................................................................................... 0.8997 0.9035 0.42 

0470 ......................................................................................................................................................... 0.4337 0.4155 ¥4.20 

0480 ......................................................................................................................................................... 0.9876 0.9720 ¥1.58 

0500 ......................................................................................................................................................... 1.0211 0.9818 ¥3.85 

0520 ......................................................................................................................................................... 0.9991 1.0130 1.39 

0560 ......................................................................................................................................................... 1.1017 1.0795 ¥2.02 

0580 ......................................................................................................................................................... 0.8325 0.8494 2.03 

0600 ......................................................................................................................................................... 1.0264 0.9625 ¥6.23 

0640 ......................................................................................................................................................... 0.9637 0.9609 ¥0.29 

0680 ......................................................................................................................................................... 0.9899 0.9810 ¥0.90 

0720 ......................................................................................................................................................... 0.9929 0.9919 ¥0.10 

0733 ......................................................................................................................................................... 0.9664 0.9904 2.48 

0743 ......................................................................................................................................................... 1.3202 1.2956 ¥1.86 

0760 ......................................................................................................................................................... 0.8294 0.8406 1.35 

0840 ......................................................................................................................................................... 0.8324 0.8424 1.20 

0860 ......................................................................................................................................................... 1.2282 1.1757 ¥4.27 

0870 ......................................................................................................................................................... 0.9042 0.8935 ¥1.18 

0875 ......................................................................................................................................................... 1.2150 1.1692 ¥3.77 

Federal Register / Vol. 69, No. 106 / Wednesday, June 2, 2004 / Proposed Rules 31271

Urban MSA FY 2003 

wage index 

Proposed 

CY 2005 

wage index 

Percent 

change, FY 

2003—proposed CY 

2005 

0880 ......................................................................................................................................................... 0.9022 0.8961 ¥0.68 

0920 ......................................................................................................................................................... 0.8757 0.9029 3.11 

0960 ......................................................................................................................................................... 0.8341 0.8428 1.04 

1000 ......................................................................................................................................................... 0.9222 0.9212 ¥0.11 

1010 ......................................................................................................................................................... 0.7972 0.7965 ¥0.09 

1020 ......................................................................................................................................................... 0.8907 0.8662 ¥2.75 

1040 ......................................................................................................................................................... 0.9109 0.8832 ¥3.04 

1080 ......................................................................................................................................................... 0.9310 0.9209 ¥1.08 

1123 ......................................................................................................................................................... 1.1235 1.1233 ¥0.02 

1125 ......................................................................................................................................................... 0.9689 1.0049 3.72 

1145 ......................................................................................................................................................... 0.8535 0.8137 ¥4.66 

1150 ......................................................................................................................................................... 1.0944 1.0580 ¥3.33 

1240 ......................................................................................................................................................... 0.8880 1.0303 16.02 

1260 ......................................................................................................................................................... 0.8821 0.9019 2.24 

1280 ......................................................................................................................................................... 0.9365 0.9604 2.55 

1303 ......................................................................................................................................................... 1.0052 0.9704 ¥3.46 

1310 ......................................................................................................................................................... 0.4371 0.4158 ¥4.87 

1320 ......................................................................................................................................................... 0.8932 0.9071 1.56 

1350 ......................................................................................................................................................... 0.9690 0.9095 ¥6.14 

1360 ......................................................................................................................................................... 0.9056 0.8874 ¥2.01 

1400 ......................................................................................................................................................... 1.0635 0.9907 ¥6.85 

1440 ......................................................................................................................................................... 0.9235 0.9332 1.05 

1480 ......................................................................................................................................................... 0.8898 0.8880 ¥0.20 

1520 ......................................................................................................................................................... 0.9850 0.9730 ¥1.22 

1540 ......................................................................................................................................................... 1.0438 1.0025 ¥3.96 

1560 ......................................................................................................................................................... 0.8976 0.9086 1.23 

1580 ......................................................................................................................................................... 0.8628 0.8796 1.95 

1600 ......................................................................................................................................................... 1.1044 1.0892 ¥1.38 

1620 ......................................................................................................................................................... 0.9745 1.0193 4.60 

1640 ......................................................................................................................................................... 0.9381 0.9413 0.34 

1660 ......................................................................................................................................................... 0.8406 0.8244 ¥1.93 

1680 ......................................................................................................................................................... 0.9670 0.9671 0.01 

1720 ......................................................................................................................................................... 0.9916 0.9833 ¥0.84 

1740 ......................................................................................................................................................... 0.8496 0.8695 2.34 

1760 ......................................................................................................................................................... 0.9307 0.8902 ¥4.35 

1800 ......................................................................................................................................................... 0.8374 0.8694 3.82 

1840 ......................................................................................................................................................... 0.9751 0.9648 ¥1.06 

1880 ......................................................................................................................................................... 0.8729 0.8521 ¥2.38 

1890 ......................................................................................................................................................... 1.1453 1.1516 0.55 

1900 ......................................................................................................................................................... 0.7847 0.8200 4.50 

1920 ......................................................................................................................................................... 0.9998 0.9974 ¥0.24 

1950 ......................................................................................................................................................... 0.8859 0.9035 1.99 

1960 ......................................................................................................................................................... 0.8835 0.8985 1.70 

2000 ......................................................................................................................................................... 0.9282 0.9518 2.54 

2020 ......................................................................................................................................................... 0.9062 0.9060 ¥0.02 

2030 ......................................................................................................................................................... 0.8973 0.8828 ¥1.62 

2040 ......................................................................................................................................................... 0.8055 0.8161 1.32 

2080 ......................................................................................................................................................... 1.0601 1.0837 2.23 

2120 ......................................................................................................................................................... 0.8791 0.9106 3.58 

2160 ......................................................................................................................................................... 1.0448 1.0101 ¥3.32 

2180 ......................................................................................................................................................... 0.8137 0.7741 ¥4.87 

2190 ......................................................................................................................................................... 0.9356 0.9805 4.80 

2200 ......................................................................................................................................................... 0.8795 0.8886 1.03 

2240 ......................................................................................................................................................... 1.0368 1.0171 ¥1.90 

2281 ......................................................................................................................................................... 1.0684 1.0934 2.34 

2290 ......................................................................................................................................................... 0.8952 0.9064 1.25 

2320 ......................................................................................................................................................... 0.9265 0.9196 ¥0.74 

2330 ......................................................................................................................................................... 0.9722 0.9783 0.63 

2335 ......................................................................................................................................................... 0.8416 0.8377 ¥0.46 

2340 ......................................................................................................................................................... 0.8376 0.8559 2.18 

2360 ......................................................................................................................................................... 0.8925 0.8601 ¥3.63 

2400 ......................................................................................................................................................... 1.0944 1.1456 4.68 

2440 ......................................................................................................................................................... 0.8177 0.8429 3.08 

2520 ......................................................................................................................................................... 0.9684 0.9797 1.17 

2560 ......................................................................................................................................................... 0.8889 0.8986 1.09 

2580 ......................................................................................................................................................... 0.8100 0.8396 3.65 

2620 ......................................................................................................................................................... 1.0682 1.1333 6.09 

2640 ......................................................................................................................................................... 1.1135 1.0858 ¥2.49 

2650 ......................................................................................................................................................... 0.7792 0.7747 ¥0.58 

2655 ......................................................................................................................................................... 0.8780 0.8709 ¥0.81 

31272 Federal Register / Vol. 69, No. 106 / Wednesday, June 2, 2004 / Proposed Rules 

Urban MSA FY 2003 

wage index 

Proposed 

CY 2005 

wage index 

Percent 

change, FY 

2003—proposed CY 

2005 

2670 ......................................................................................................................................................... 1.0066 1.0108 0.42 

2680 ......................................................................................................................................................... 1.0297 1.0163 ¥1.30 

2700 ......................................................................................................................................................... 0.9680 0.9816 1.40 

2710 ......................................................................................................................................................... 0.9823 1.0008 1.88 

2720 ......................................................................................................................................................... 0.7895 0.8424 6.70 

2750 ......................................................................................................................................................... 0.9693 0.8966 ¥7.50 

2760 ......................................................................................................................................................... 0.9457 0.9585 1.35 

2800 ......................................................................................................................................................... 0.9446 0.9359 ¥0.92 

2840 ......................................................................................................................................................... 1.0216 1.0142 ¥0.72 

2880 ......................................................................................................................................................... 0.8505 0.8206 ¥3.52 

2900 ......................................................................................................................................................... 0.9871 0.9693 ¥1.80 

2920 ......................................................................................................................................................... 0.9465 0.9279 ¥1.97 

2960 ......................................................................................................................................................... 0.9584 0.9410 ¥1.82 

2975 ......................................................................................................................................................... 0.8281 0.8475 2.34 

2980 ......................................................................................................................................................... 0.8892 0.8622 ¥3.04 

2985 ......................................................................................................................................................... 0.8897 0.8636 ¥2.93

2995 ......................................................................................................................................................... 0.9456 0.9633 1.87

3000 ......................................................................................................................................................... 0.9525 0.9469 ¥0.59

3040 ......................................................................................................................................................... 0.8950 0.8809 ¥1.58

3060 ......................................................................................................................................................... 0.9237 0.9372 1.46

3080 ......................................................................................................................................................... 0.9502 0.9461 ¥0.43

3120 ......................................................................................................................................................... 0.9282 0.9166 ¥1.25

3150 ......................................................................................................................................................... 0.9100 0.9098 ¥0.02

3160 ......................................................................................................................................................... 0.9122 0.9335 2.34

3180 ......................................................................................................................................................... 0.9268 0.9172 ¥1.04

3200 ......................................................................................................................................................... 0.9418 0.9214 ¥2.17

3240 ......................................................................................................................................................... 0.9223 0.9164 ¥0.64

3283 ......................................................................................................................................................... 1.1549 1.1555 0.05

3285 ......................................................................................................................................................... 0.7659 0.7307 ¥4.60

3290 ......................................................................................................................................................... 0.9028 0.9242 2.37

3320 ......................................................................................................................................................... 1.1457 1.1098 ¥3.13

3350 ......................................................................................................................................................... 0.8385 0.7771 ¥7.32

3360 ......................................................................................................................................................... 0.9892 0.9834 ¥0.59

3400 ......................................................................................................................................................... 0.9636 0.9595 ¥0.43

3440 ......................................................................................................................................................... 0.8903 0.9245 3.84

3480 ......................................................................................................................................................... 0.9717 0.9916 2.05

3500 ......................................................................................................................................................... 0.9587 0.9548 ¥0.41

3520 ......................................................................................................................................................... 0.9532 0.8986 ¥5.73

3560 ......................................................................................................................................................... 0.8607 0.8357 ¥2.90

3580 ......................................................................................................................................................... 0.9275 0.8984 ¥3.14

3600 ......................................................................................................................................................... 0.9381 0.9529 1.58

3605 ......................................................................................................................................................... 0.8239 0.8544 3.70

3610 ......................................................................................................................................................... 0.7976 0.7762 ¥2.68

3620 ......................................................................................................................................................... 0.9849 0.9282 ¥5.76

3640 ......................................................................................................................................................... 1.1190 1.1115 ¥0.67

3660 ......................................................................................................................................................... 0.8268 0.8253 ¥0.18

3680 ......................................................................................................................................................... 0.8329 0.8158 ¥2.05

3700 ......................................................................................................................................................... 0.7749 0.7794 0.58

3710 ......................................................................................................................................................... 0.8613 0.8681 0.79

3720 ......................................................................................................................................................... 1.0595 1.0500 ¥0.90

3740 ......................................................................................................................................................... 1.0790 1.0419 ¥3.44

3760 ......................................................................................................................................................... 0.9736 0.9715 ¥0.22

3800 ......................................................................................................................................................... 0.9686 0.9761 0.77

3810 ......................................................................................................................................................... 1.0399 0.9159 ¥11.92

3840 ......................................................................................................................................................... 0.8970 0.8820 ¥1.67

3850 ......................................................................................................................................................... 0.8971 0.9045 0.82 

3870 ......................................................................................................................................................... 0.9400 0.9247 ¥1.63 

3880 ......................................................................................................................................................... 0.8475 0.8207 ¥3.16 

3920 ......................................................................................................................................................... 0.9278 0.9036 ¥2.61 

3960 ......................................................................................................................................................... 0.7965 0.7841 ¥1.56 

3980 ......................................................................................................................................................... 0.9357 0.8811 ¥5.84 

4000 ......................................................................................................................................................... 0.9078 0.9282 2.25 

4040 ......................................................................................................................................................... 0.9726 0.9714 ¥0.12 

4080 ......................................................................................................................................................... 0.8472 0.8091 ¥4.50 

4100 ......................................................................................................................................................... 0.8745 0.8688 ¥0.65 

4120 ......................................................................................................................................................... 1.1521 1.1528 0.06 

4150 ......................................................................................................................................................... 0.7923 0.8074 1.91 

4200 ......................................................................................................................................................... 0.8315 0.8267 ¥0.58 

4243 ......................................................................................................................................................... 0.9179 0.9383 2.22 

4280 ......................................................................................................................................................... 0.8581 0.8685 1.21 

Federal Register / Vol. 69, No. 106 / Wednesday, June 2, 2004 / Proposed Rules 31273

Urban MSA FY 2003 

wage index 

Proposed 

CY 2005 

wage index 

Percent 

change, FY 

2003—proposed CY 

2005 

4320 ......................................................................................................................................................... 0.9483 0.9522 0.41 

4360 ......................................................................................................................................................... 0.9892 1.0033 1.43 

4400 ......................................................................................................................................................... 0.9097 0.8923 ¥1.91 

4420 ......................................................................................................................................................... 0.8629 0.9113 5.61 

4480 ......................................................................................................................................................... 1.2001 1.1795 ¥1.72 

4520 ......................................................................................................................................................... 0.9276 0.9242 ¥0.37 

4600 ......................................................................................................................................................... 0.9646 0.8272 ¥14.24 

4640 ......................................................................................................................................................... 0.9219 0.9134 ¥0.92 

4680 ......................................................................................................................................................... 0.9204 0.8953 ¥2.73 

4720 ......................................................................................................................................................... 1.0467 1.0264 ¥1.94 

4800 ......................................................................................................................................................... 0.8900 0.9180 3.15 

4840 ......................................................................................................................................................... 0.4914 0.4795 ¥2.42 

4880 ......................................................................................................................................................... 0.8428 0.8381 ¥0.56 

4890 ......................................................................................................................................................... 1.0498 1.0772 2.61 

4900 ......................................................................................................................................................... 1.0253 0.9776 ¥4.65 

4920 ......................................................................................................................................................... 0.8920 0.9009 1.00 

4940 ......................................................................................................................................................... 0.9837 0.9692 ¥1.47 

5000 ......................................................................................................................................................... 0.9802 0.9894 0.94 

5015 ......................................................................................................................................................... 1.1213 1.1366 1.36 

5080 ......................................................................................................................................................... 0.9893 0.9988 0.96 

5120 ......................................................................................................................................................... 1.0903 1.1001 0.90 

5140 ......................................................................................................................................................... 0.9157 0.8718 ¥4.79 

5160 ......................................................................................................................................................... 0.8108 0.7994 ¥1.41 

5170 ......................................................................................................................................................... 1.0498 1.1275 7.40 

5190 ......................................................................................................................................................... 1.0674 1.0956 2.64 

5200 ......................................................................................................................................................... 0.8137 0.7922 ¥2.64 

5240 ......................................................................................................................................................... 0.7734 0.7907 2.24 

5280 ......................................................................................................................................................... 0.9284 0.8775 ¥5.48 

5330 ......................................................................................................................................................... 0.8976 0.9112 1.52 

5345 ......................................................................................................................................................... 0.9754 0.9790 0.37 

5360 ......................................................................................................................................................... 0.9578 0.9855 2.89 

5380 ......................................................................................................................................................... 1.3357 1.3140 ¥1.62 

5483 ......................................................................................................................................................... 1.2408 1.2385 ¥0.19 

5523 ......................................................................................................................................................... 1.1767 1.1631 ¥1.16 

5560 ......................................................................................................................................................... 0.9046 0.9174 1.41 

5600 ......................................................................................................................................................... 1.4414 1.4018 ¥2.75 

5640 ......................................................................................................................................................... 1.1381 1.1518 1.20 

5660 ......................................................................................................................................................... 1.1387 1.1509 1.07 

5720 ......................................................................................................................................................... 0.8574 0.8619 0.52 

5775 ......................................................................................................................................................... 1.5072 1.4921 ¥1.00 

5790 ......................................................................................................................................................... 0.9402 0.9728 3.47 

5800 ......................................................................................................................................................... 0.9397 0.9327 ¥0.74 

5880 ......................................................................................................................................................... 0.8900 0.8984 0.94 

5910 ......................................................................................................................................................... 1.0960 1.0963 0.03 

5920 ......................................................................................................................................................... 0.9978 0.9745 ¥2.34 

5945 ......................................................................................................................................................... 1.1474 1.1372 ¥0.89 

5960 ......................................................................................................................................................... 0.9640 0.9654 0.15 

5990 ......................................................................................................................................................... 0.8344 0.8374 0.36 

6015 ......................................................................................................................................................... 0.8865 0.8202 ¥7.48 

6020 ......................................................................................................................................................... 0.8127 0.8039 ¥1.08 

6080 ......................................................................................................................................................... 0.8645 0.8753 1.25 

6120 ......................................................................................................................................................... 0.8739 0.8734 ¥0.06 

6160 ......................................................................................................................................................... 1.0713 1.0883 1.59 

6200 ......................................................................................................................................................... 0.9820 1.0129 3.15 

6240 ......................................................................................................................................................... 0.7962 0.7865 ¥1.22 

6280 ......................................................................................................................................................... 0.9365 0.8901 ¥4.95 

6323 ......................................................................................................................................................... 1.0235 1.0276 0.40 

6340 ......................................................................................................................................................... 0.9372 0.9042 ¥3.52 

6360 ......................................................................................................................................................... 0.5169 0.4708 ¥8.92 

6403 ......................................................................................................................................................... 0.9794 0.9949 1.58 

6440 ......................................................................................................................................................... 1.0667 1.1213 5.12 

6483 ......................................................................................................................................................... 1.0854 1.0977 1.13 

6520 ......................................................................................................................................................... 0.9984 0.9976 ¥0.08 

6560 ......................................................................................................................................................... 0.8820 0.8778 ¥0.48 

6580 ......................................................................................................................................................... 0.9218 0.9510 3.17 

6600 ......................................................................................................................................................... 0.9334 0.8814 ¥5.57 

6640 ......................................................................................................................................................... 0.9990 0.9959 ¥0.31 

6660 ......................................................................................................................................................... 0.8846 0.8806 ¥0.45 

6680 ......................................................................................................................................................... 0.9295 0.9133 ¥1.74 

6690 ......................................................................................................................................................... 1.1135 1.1352 1.95 

31274 Federal Register / Vol. 69, No. 106 / Wednesday, June 2, 2004 / Proposed Rules 

Urban MSA FY 2003 

wage index 

Proposed 

CY 2005 

wage index 

Percent 

change, FY 

2003—proposed CY 

2005 

6720 ......................................................................................................................................................... 1.0648 1.0682 0.32 

6740 ......................................................................................................................................................... 1.1491 1.0609 ¥7.68 

6760 ......................................................................................................................................................... 0.9477 0.9349 ¥1.35 

6780 ......................................................................................................................................................... 1.1365 1.1348 ¥0.15 

6800 ......................................................................................................................................................... 0.8614 0.8700 1.00 

6820 ......................................................................................................................................................... 1.2139 1.1739 ¥3.30 

6840 ......................................................................................................................................................... 0.9194 0.9430 2.57 

6880 ......................................................................................................................................................... 0.9625 0.9666 0.43 

6895 ......................................................................................................................................................... 0.9228 0.9076 ¥1.65 

6920 ......................................................................................................................................................... 1.1500 1.1845 3.00 

6960 ......................................................................................................................................................... 0.9650 1.0032 3.96 

6980 ......................................................................................................................................................... 0.9700 0.9506 ¥2.00 

7000 ......................................................................................................................................................... 0.8021 0.8056 0.44 

7040 ......................................................................................................................................................... 0.8855 0.9033 2.01 

7080 ......................................................................................................................................................... 1.0367 1.0482 1.11 

7120 ......................................................................................................................................................... 1.4623 1.4339 ¥1.94 

7160 ......................................................................................................................................................... 0.9945 0.9913 ¥0.32 

7200 ......................................................................................................................................................... 0.8374 0.8535 1.92 

7240 ......................................................................................................................................................... 0.8753 0.8870 1.34 

7320 ......................................................................................................................................................... 1.1131 1.1147 0.14 

7360 ......................................................................................................................................................... 1.4142 1.4514 2.63 

7400 ......................................................................................................................................................... 1.4145 1.4626 3.40 

7440 ......................................................................................................................................................... 0.4741 0.4909 3.54 

7460 ......................................................................................................................................................... 1.1271 1.1429 1.40 

7480 ......................................................................................................................................................... 1.0481 1.0441 ¥0.38 

7485 ......................................................................................................................................................... 1.3646 1.2942 ¥5.16 

7490 ......................................................................................................................................................... 1.0712 1.0653 ¥0.55 

7500 ......................................................................................................................................................... 1.3046 1.2877 ¥1.30 

7510 ......................................................................................................................................................... 0.9425 0.9964 5.72 

7520 ......................................................................................................................................................... 0.9376 0.9472 1.02 

7560 ......................................................................................................................................................... 0.8599 0.8412 ¥2.17 

7600 ......................................................................................................................................................... 1.1474 1.1562 0.77 

7610 ......................................................................................................................................................... 0.7869 0.7751 ¥1.50 

7620 ......................................................................................................................................................... 0.8697 0.8624 ¥0.84 

7640 ......................................................................................................................................................... 0.9255 0.9700 4.81 

7680 ......................................................................................................................................................... 0.8987 0.9083 1.07 

7720 ......................................................................................................................................................... 0.9046 0.8993 ¥0.59 

7760 ......................................................................................................................................................... 0.9257 0.9309 0.56 

7800 ......................................................................................................................................................... 0.9802 0.9821 0.19 

7840 ......................................................................................................................................................... 1.0852 1.0901 0.45 

7880 ......................................................................................................................................................... 0.8659 0.8944 3.29 

7920 ......................................................................................................................................................... 0.8424 0.8457 0.39 

8003 ......................................................................................................................................................... 1.0927 1.0543 ¥3.51 

8050 ......................................................................................................................................................... 0.8941 0.8740 ¥2.25 

8080 ......................................................................................................................................................... 0.8804 0.8398 ¥4.61 

8120 ......................................................................................................................................................... 1.0506 1.0404 ¥0.97 

8140 ......................................................................................................................................................... 0.8273 0.8243 ¥0.36 

8160 ......................................................................................................................................................... 0.9714 0.9412 ¥3.11 

8200 ......................................................................................................................................................... 1.0940 1.1116 1.61 

8240 ......................................................................................................................................................... 0.8504 0.8520 0.19 

8280 ......................................................................................................................................................... 0.9065 0.9103 0.42 

8320 ......................................................................................................................................................... 0.8599 0.8325 ¥3.19 

8360 ......................................................................................................................................................... 0.8088 0.8150 0.77 

8400 ......................................................................................................................................................... 0.9810 0.9381 ¥4.37 

8440 ......................................................................................................................................................... 0.9199 0.9108 ¥0.99 

8480 ......................................................................................................................................................... 1.0432 1.0517 0.81 

8520 ......................................................................................................................................................... 0.8911 0.8981 0.79 

8560 ......................................................................................................................................................... 0.8332 0.9185 10.24 

8600 ......................................................................................................................................................... 0.8130 0.8212 1.01 

8640 ......................................................................................................................................................... 0.9521 0.9404 ¥1.23 

8680 ......................................................................................................................................................... 0.8465 0.8403 ¥0.73 

8720 ......................................................................................................................................................... 1.3354 1.3377 0.17 

8735 ......................................................................................................................................................... 1.1096 1.1064 ¥0.29 

8750 ......................................................................................................................................................... 0.8756 0.8184 ¥6.53 

8760 ......................................................................................................................................................... 1.0031 1.0405 3.73 

8780 ......................................................................................................................................................... 0.9429 0.9856 4.53 

8800 ......................................................................................................................................................... 0.8073 0.8394 3.98 

8840 ......................................................................................................................................................... 1.0851 1.0904 0.49 

8920 ......................................................................................................................................................... 0.8069 0.8366 3.68 

8940 ......................................................................................................................................................... 0.9782 0.9692 ¥0.92 

Federal Register / Vol. 69, No. 106 / Wednesday, June 2, 2004 / Proposed Rules 31275

Urban MSA FY 2003 

wage index 

Proposed 

CY 2005 

wage index 

Percent 

change, FY 

2003—proposed CY 

2005 

8960 ......................................................................................................................................................... 0.9939 0.9798 ¥1.42 

9000 ......................................................................................................................................................... 0.7670 0.7494 ¥2.29 

9040 ......................................................................................................................................................... 0.9520 0.9238 ¥2.96 

9080 ......................................................................................................................................................... 0.8498 0.8341 ¥1.85 

9140 ......................................................................................................................................................... 0.8544 0.8158 ¥4.52 

9160 ......................................................................................................................................................... 1.1173 1.0882 ¥2.60 

9200 ......................................................................................................................................................... 0.9640 0.9563 ¥0.80 

9260 ......................................................................................................................................................... 1.0569 1.0372 ¥1.86 

9270 ......................................................................................................................................................... 0.9434 0.9204 ¥2.44 

9280 ......................................................................................................................................................... 0.9026 0.9119 1.03 

9320 ......................................................................................................................................................... 0.9358 0.9214 ¥1.54 

9340 ......................................................................................................................................................... 1.0276 1.0196 ¥0.78 

9360 ......................................................................................................................................................... 0.8589 0.8895 3.56

[FR Doc. 04–12314 Filed 5–28–04; 4:00 pm] 

BILLING CODE 4120–01–P