45966 Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations

DEPARTMENT OF HEALTH AND

HUMAN SERVICES

Health Care Financing Administration

42 CFR Parts 400, 409, 410, 411, 412,

413, 424, 440, 485, 488, 489, and 498

[BPD–878–FC]

RIN 0938–AH55

Medicare Program; Changes to the

Hospital Inpatient Prospective

Payment Systems and Fiscal Year 1998

Rates

AGENCY: Health Care Financing

Administration (HCFA), HHS.

ACTION: Final rule with comment period.

SUMMARY: We are revising the Medicare

hospital inpatient prospective payment

systems for operating costs and capitalrelated costs to implement necessary

changes resulting from the Balanced

Budget Act of 1997, Pub. L. 105–33, and

changes arising from our continuing

experience with the systems. In the

addendum to this final rule with

comment period, we describe changes

in the amounts and factors necessary to

determine prospective payment rates for

Medicare hospital inpatient services for

operating costs and capital-related costs.

Generally, these changes are applicable

to discharges occurring on or after

October 1, 1997. We also set forth rateof-increase limits and changes for

hospitals and hospital units excluded

from the prospective payment systems.

DATES: Effective Date: This rule is a

major rule as defined in Title 5, United

States Code, section 804(2). Section

4644 of Pub. L. 105–33 provides that,

with respect to this final rule, the

reference in Title 5, United States Code,

section 801(a)(3)(A) to a 60-day delay in

the effective date for major rules is

deemed to be a reference to a 30-day

delay. In accordance with these

provisions, the provisions of this final

rule with comment period are effective

on October 1, 1997.

Comment Period: Comments on the

provisions resulting from the Balanced

Budget Act of 1997 will be considered

if received at the appropriate address, as

provided below, no later than 5 p.m. on

October 28, 1997. We will not consider

comments concerning provisions that

remain unchanged from the June 2, 1997

proposed rule or that were revised based

on public comment.

ADDRESSES: Mail written comments (one

original and three copies) to the

following address: Health Care

Financing Administration, Department

of Health and Human Services,

Attention: BPD–878–FC, P.O. Box 7517,

Baltimore, MD 21207–0517.

If you prefer, you may deliver your

written comments (one original and

three copies) to one of the following

addresses: Room 309–G, Hubert H.

Humphrey Building, 200 Independence

Avenue, SW, Washington, DC 20201, or

Room C5–09–26, Central Building, 7500

Security Boulevard, Baltimore, MD

21244–1850.

Because of staffing and resource

limitations, we cannot accept comments

by facsimile (FAX) transmission. In

commenting, please refer to file code

BPD–878–FC. Comments received

timely will be available for public

inspection as they are received,

generally beginning approximately three

weeks after publication of a document,

in Room 309–G of the Department’s

offices at 200 Independence Avenue,

SW, Washington, DC, on Monday

through Friday of each week from 8:30

a.m. to 5 p.m. (phone: (202) 690–7890).

For comments that relate to

information collection requirements,

mail a copy of comments to:

Office of Information and Regulatory

Affairs, Office of Management and

Budget, Room 10235, New Executive

Office Building, Washington, DC

20503, Attn: Allison Herron Eydt,

HCFA Desk Officer; and

Health Care Financing Administration,

Office of Information Services,

Information Technology Investment

Management Group, Division of

HCFA Enterprise Standards, Room

C2–26–17, 7500 Security Boulevard,

Baltimore, MD 21244–1850

Copies: To order copies of the Federal

Register containing this document, send

your request to: New Orders,

Superintendent of Documents, P.O. Box

371954, Pittsburgh, PA 15250–7954.

Specify the date of the issue requested

and enclose a check or money order

payable to the Superintendent of

Documents, or enclose your Visa or

Master Card number and expiration

date. Credit card orders can also be

placed by calling the order desk at (202)

512–1800 or by faxing to (202) 512–

2250. The cost for each copy is $8.00.

As an alternative, you can view and

photocopy the Federal Register

document at most libraries designated

as Federal Depository Libraries and at

many other public and academic

libraries throughout the country that

receive the Federal Register.

FOR FURTHER INFORMATION CONTACT:

Nancy Edwards, (410) 786–4531,

Operating Prospective Payment, DRG,

and Wage Index Issues. Tzvi Hefter,

(410) 786–4487, Capital Prospective

Payment, Excluded Hospitals, and

Graduate Medical Education Issues.

SUPPLEMENTARY INFORMATION:

I. Background

A. Summary

Under section 1886(d) of the Social

Security Act (the Act), a system of

payment for the operating costs of acute

care hospital inpatient stays under

Medicare Part A (Hospital Insurance)

based on prospectively-set rates was

established effective with hospital cost

reporting periods beginning on or after

October 1, 1983. Under this system,

Medicare payment for hospital inpatient

operating costs is made at a

predetermined, specific rate for each

hospital discharge. All discharges are

classified according to a list of

diagnosis-related groups (DRGs). The

regulations governing the hospital

inpatient prospective payment system

are located in 42 CFR part 412.

As required by section 1886(g) of the

Act, effective with cost reporting

periods beginning on or after October 1,

1991, we also have implemented a

prospective payment methodology for

hospital inpatient capital-related costs.

Under the capital-related cost

methodology, a predetermined payment

amount per discharge is made for

Medicare inpatient capital-related costs.

B. Summary of the Provisions of the

June 2, 1997 Proposed Rule

On June 2, 1997, we published a

proposed rule in the Federal Register

(62 FR 29902) setting forth proposed

changes to the Medicare hospital

inpatient prospective payment systems

for both operating costs and capitalrelated costs, which would be effective

for discharges occurring on or after

October 1, 1997. Subsequently, on

August 5, 1997, the Balanced Budget

Act of 1997, Public Law 105–33, was

enacted. This Act made major changes

to the Medicare hospital payment

systems, rates, and policies effective

beginning with FY 1998. These

legislative changes are summarized

under section I.D. of this preamble.

More specific details on individual

provisions that we are implementing in

this final rule with comment period are

included under the various sections of

this preamble.

Following is a summary of the major

changes that we had proposed to make

in the June 2, 1997 proposed rule:

• We proposed changes for FY 1998

DRG classifications and relative

weights, as required by section

1886(d)(4)(c) of the Act.

• We proposed to update the hospital

wage index for FY 1998. We also
Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations 45967

proposed revisions to the wage index

based on hospital redesignations and a

revised process for wage data

verification.

• We proposed to use a revised

hospital market basket in developing the

recommended FY 1998 update factor for

the operating prospective payment rates

and the excluded hospital rate-ofincrease limits.

• We discussed several provisions of

the regulations in 42 CFR Parts 412 and

413 and set forth certain proposed

changes concerning the following:

+ Elimination of day outlier

payments.

+ Rural referral centers.

+ Indirect medical education.

+ Direct graduate medical education

programs.

• We discussed several provisions of

the regulations in 42 CFR parts 412, 413,

and 489 and set forth certain proposed

changes and clarifications concerning

the following:

+ Possible adjustments to capital

minimum payment levels.

+ Special exceptions application

process.

• We proposed changes to the

application of the criteria for ‘‘hospitals

within hospitals’’ seeking exclusion

from the prospective payment system.

We also proposed technical

clarifications concerning exclusion of

rehabilitation units.

• In the addendum to the proposed

rule, we set forth proposed changes to

the amounts and factors for determining

the FY 1998 prospective payment rates

for operating costs and capital-related

costs. We also proposed update factors

for determining the rate-of-increase

limits for cost reporting periods

beginning in FY 1998 for hospitals and

hospital units excluded from the

prospective payment system.

• In Appendix A of the proposed

rule, we set forth an analysis of the

impact that the proposed changes would

have on affected entities.

• In Appendix B of the proposed rule,

we set forth our technical appendix on

the proposed FY 1998 capital cost

model.

• In Appendix C of the proposed rule,

we set forth the data sources used to

determine the market basket relative

weights and choice of price proxies.

• In Appendix D of the proposed rule,

we included our report to Congress on

our initial estimate of an update factor

for FY 1998 for both hospitals included

in and hospitals excluded from the

prospective payment systems, as

required by section 1886(e)(3)(B) of the

Act.

• As required by sections 1886(e)(4)

and (e)(5) of the Act, in Appendix E, we

provided our recommendation of the

appropriate percentage change for FY

1998 for the following:

+ Large urban area and other area

average standardized amounts (and

hospital-specific rates applicable to sole

community hospitals) for hospital

inpatient services paid for under the

prospective payment system for

operating costs.

+ Target rate-of-increase limits to the

allowable operating costs of hospital

inpatient services furnished by hospitals

and hospital units excluded from the

prospective payment system.

• In the proposed rule, we discussed

in detail the March 1, 1997

recommendations made by the

Prospective Payment Assessment

Commission (ProPAC). ProPAC is

directed by section 1886(e)(2)(A) of the

Act to make recommendations on the

appropriate percentage change factor to

be used in updating the average

standardized amounts. In addition,

section 1886(e)(2)(B) of the Act directs

ProPAC to make recommendations

regarding changes in each of the

Medicare payment policies under which

payments to an institution are

prospectively determined. In particular,

the recommendations relating to the

hospital inpatient prospective payment

systems are to include

recommendations concerning the

number of DRGs used to classify

patients, adjustments to the DRGs to

reflect severity of illness, and changes in

the methods under which hospitals are

paid for capital-related costs. Under

section 1886(e)(3)(A) of the Act, the

recommendations required of ProPAC

under sections 1886(e)(2) (A) and (B) of

the Act are to be reported to Congress

not later than March 1 of each year.

We printed ProPAC’s March 1, 1997

report, which included its

recommendations, as Appendix F to the

proposed rule. The recommendations,

and the actions we proposed to take

with regard to them (when an action

was recommended), were discussed in

detail in the appropriate sections of the

preamble, the addendum, or the

appendices to the proposed rule.

C. Public Comments Received in

Response to the June 2 Proposed Rule

A total of 341 items of

correspondence containing comments

on the proposed rule were received. The

main areas of concern addressed by the

commenters were the changes in the

DRG classifications related to coronary

stents and stereotactic radiosurgery, and

the request for comments on future

changes for burn cases. Among other

areas of concern addressed by the

commenters were implementation of the

FY 1999 wage index and the policy

change related to hospitals and hospital

units excluded from the prospective

payment system (specifically, hospitalwithin-hospital policy).

Summaries of the public comments

received and our responses to those

comments appear in the individual

related sections of the preamble.

D. Relevant Provisions of the Balanced

Budget Act of 1997

As noted above, on August 5, 1997,

after we had issued the proposed rule

for the FY 1998 prospective payment

system changes, the Balanced Budget

Act of 1997 was enacted. This Act made

major changes that affect Medicare

payments for hospital inpatient services

under the prospective payment systems

and the cost limits applicable to

excluded hospitals, as well as the direct

graduate medical education payments.

Because most of these changes are

effective October 1, 1997, we have had

to make some revisions to the June 2

proposals as well as make additional

changes. The provisions of Public Law

105–33 that we are implementing in this

final rule with comment period are as

follows:

1. Hospital Operating Payment

Update. The applicable percentage

change in the standardized amounts is

0 percent for FY 1998, the market basket

percentage increase minus 1.9

percentage points for all hospitals in all

areas for FY 1999, the market basket

percentage increase minus 1.8

percentage points for hospitals in all

areas for FY 2000, the market basket

percentage increase minus 1.1

percentage points for hospitals for all

areas for FYs 2001 and 2002, and the

market basket percentage increase for

hospitals in all areas for FY 2003 and

subsequent fiscal years. (Section

4401(a))

Hospitals that do not receive

disproportionate share (DSH) or indirect

medical education (IME) payments and

are (MDH) for FY 1998 or 1999 will

receive a higher update for that year if—

• The hospital is in a State in which

the aggregate prospective payment

system operating payments to these

types of hospitals is less than the

aggregate prospective payment system

operating costs (an overall State

negative operating margin) for FY 1995

cost reporting periods; and

• The hospital itself has a negative

operating prospective payment system

margin in the payment year. (Section

4401(b))

2. Hospital Capital Rate Reduction.

The Federal capital rate and the

hospital-specific rate are reduced by

applying the budget neutrality factor
45968 Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations

that was in effect in FY 1995, which

results in a 15.68 percent reduction in

the rates. In addition, for FY 1998

through FY 2002, both rates will be

reduced an additional 2.1 percent.

These reductions together result in an

overall reduction of 17.78 percent in the

unadjusted rates for the next 5 years.

(Section 4402)

3. Disproportionate Share Payments.

The DSH payments to hospitals are

reduced by 1 percent in FY 1998, 2

percent in FY 1999, 3 percent in FY

2000, 4 percent in FY 2001, and 5

percent in FY 2002. (Section 4403)

4. Outlier Payments. Beginning in FY

1998, IME and DSH payments will be

made only on the base DRG payment

rates and not on outlier payments. In

determining outlier payments, the fixed

loss cost outlier threshold will

encompass payments for IME and DSH.

(Section 4405)

5. Base Payment Rate to Puerto Rico

Hospitals. The national share of the

Puerto Rico payment rate is increased

from 25 to 50 percent. Thus, these

hospitals will be paid based on 50

percent of a national payment amount

(based on a discharge-weighted average

of the large urban and other urban

national standardized amounts) and 50

percent of the Puerto Rico payment

amount. (Section 4406)

6. Special Reclassification. The

Secretary is given discretionary

authority to deem Stanly County, North

Carolina (a rural county) as a part of the

Charlotte-Gastonia-Rock Hill, North

Carolina-South Carolina MSA (a large

urban area) for purposes of the

prospective payment system. (Section

4408)

7. New Guidelines for Geographic

Reclassification. Public Law 105–33

includes several provisions concerning

geographic reclassification under

section 1886(d)(10) of the Act. For

geographic reclassifications for FY 1998

and subsequent years, the Secretary

must establish and publish alternative

guidelines for a hospital that

demonstrates that—

• Its average hourly wage is at least

108 percent of the average hourly wage

of all other hospitals in its Metropolitan

Statistical Area (MSA) (or New England

County Metropolitan Area (NECMA));

• It pays at least 40 percent of the

adjusted uninflated wages in the MSA;

and

• It submitted an application and was

approved for reclassification for the

wage index for FYs 1992 through 1997.

(Section 4409)

For reclassifications for FYs 1999,

2000, and 2001, a hospital may seek

reclassification to another area for

purposes of DSH payment whether or

not the standardized amount is the

same. (Section 4203(a))

For any hospital that has ever been

classified as a rural referral center

(RRC), the Medicare Geographic

Classification Review Board (MGCRB)

may not reject an application for

reclassification for purposes of the wage

index on the basis of the 108 percent

rule. (Section 4202)

For any hospital that is owned by a

municipality and was reclassified as an

urban hospital for FY 1996, the

Secretary must exclude the overhead

wages and hours associated with a

skilled nursing facility that is owned by

the hospital and that is physically

located apart from the hospital in

determining the hospital’s average

hourly wage for purposes of qualifying

for FY 1998 reclassification, if the

hospital had previously applied for and

been denied reclassification for FY

1998. (Section 4410(c))

8. Floor on Area Wage Index.

Beginning with FY 1998, the wage index

for an urban hospital may not be lower

than the Statewide area rural wage

index. (Section 4410 (a) and (b))

9. Indirect Medical Education. The

IME formula is revised to reduce the

IME adjustment factor from 7.7 percent

to 7.0 percent in FY 1998, 6.5 percent

in FY 1999, 6.0 percent in FY 2000, and

5.5 percent in FY 2001 and subsequent

fiscal years. (Section 4621(a))

For cost reporting periods beginning

on or after October 1, 1997, the total

number of full-time equivalent residents

in a hospital’s approved medical

residency training program in the fields

of allopathic medicine and osteopathic

medicine is limited to the hospital’s

full-time equivalent count for the most

recent cost reporting period ending on

or before December 31, 1996. For cost

reporting periods beginning on or after

October 1, 1997, a hospital’s indirect

medical education full-time equivalent

count is based on the average full-time

equivalent count for the cost reporting

period and the preceding two cost

reporting periods. For the first cost

reporting period beginning on or after

October 1, 1997, the average is based on

residents in that period and the

preceding period. The statute provides

for adjustments for short periods and a

transition rule for FY 1998.

Furthermore, the ratio of residents-tobeds may not exceed the ratio calculated

during the prior cost reporting period

(after accounting for the cap on the

number of resident FTEs).

For portions of cost reporting periods

occurring on or after January 1, 1998,

the Secretary must make payments to

teaching hospitals for the indirect costs

of graduate medical education

associated with Medicare managed care

discharges. Payment is equal to the per

discharge amount that would have been

made for that discharge if the

beneficiary were not enrolled in

managed care, multiplied by an

applicable percentage. The applicable

percentage is 20 percent in 1998, 40

percent in 1999, 60 percent in 2000, 80

percent in 2001, and 100 percent in

2002 and subsequent years.

10. Rural Referral Centers. Any

hospital classified as an RRC for FY

1991 will be classified as an RRC for FY

1998 and subsequent fiscal years.

(Section 4202(b))

11. Medicare-Dependent, Small Rural

Hospitals. The special treatment of

MDHs is reinstated for FYs 1998, 1999,

and 2000. The payment methodology is

identical to the methodology applicable

in FY 1993; that is, if the hospital’s

hospital-specific rate based on 1982 or

1987 costs is higher than the Federal

rate, the hospital receives 50 percent of

the difference between the Federal rate

and the hospital-specific rate. (Section

4204)

12. Reinstatement of the Add-On for

Blood Clotting Factor. The add-on

payment for blood clotting factor

provided to inpatients with hemophilia

is permanently reinstated beginning in

FY 1998. (Section 4452)

13. Counting Residents for Direct

Graduate Medical Education. For cost

reporting periods beginning on or after

October 1, 1997, the total number of

unweighted full-time equivalent

residents in a hospital’s approved

medical residency training program in

the fields of allopathic medicine and

osteopathic medicine is limited to the

hospital’s unweighted full-time

equivalent count for the most recent

cost reporting period ending on or

before December 31, 1996. For cost

reporting periods beginning on or after

October 1, 1997, a hospital’s direct

medical education full-time equivalent

count is based on the average full-time

equivalent count for the cost reporting

period and the preceding two cost

reporting periods. For the first cost

reporting period beginning on or after

October 1, 1997 the average is based on

residents in that period and the

preceding period. The statute provides

for adjustments for short periods and a

transition rule for FY 1998.

The Secretary is permitted to

prescribe rules that allow institutions

that are members of the same affiliated

group (as defined by the Secretary) to

elect to apply the FTE cap on an

aggregate basis.

The Secretary must prescribe rules for

providing exceptions to the cap for
Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations 45969

medical residency training programs

beginning on or after January 1, 1995.

The statute gives the Secretary

authority to collect whatever data are

necessary to implement these

provisions. (Section 4623)

14. Payments to Managed Care Plans

for Graduate Medical Education. For

portions of cost reporting periods

occurring on or after January 1, 1998,

the Secretary must make payments to

teaching hospitals for the direct costs of

graduate medical education associated

with Medicare managed care discharges.

Payment is equal to the product of the

per resident amount, the total number of

FTE residents working all areas of the

hospital, the fraction of the total number

of inpatient bed days that are

attributable to Medicare managed care

enrollees, and an applicable percentage.

The applicable percentage is 20 percent

in 1998, 40 percent in 1999, 60 percent

in 2000, 80 percent in 2001 and 100

percent in 2002 and subsequent years.

(Section 4624)

15. Payment to Nonhospital

Providers. For cost reporting periods

beginning on or after October 1, 1997,

the Secretary may establish rules for

payment to qualified nonhospital

providers for the direct costs of medical

education incurred in the operation of

an approved medical residency training

program. Qualified nonhospital

providers include federally qualified

health centers, rural health clinics,

Medicare Choice organizations, and any

other nonhospital providers that the

Secretary determines to be appropriate.

The rules established by the Secretary

must specify the amounts, form, and

manner in which payments will be

made and the portion of the payments

that will be made from each of the

Medicare Trust Funds. The Secretary

must reduce the aggregate amount paid

to hospitals to the extent payment is

made to nonhospital providers for

residents included in the hospital’s fulltime equivalent count. (Section 4625)

16. Payment for Combined Medical

Residency Training Programs. The

initial residency period for combined

programs consisting only of primary

care training is the longest of the

composite programs plus one additional

year. A resident enrolled in a combined

medical residency training program that

includes an obstetrics and gynecology

program qualifies for this special rule if

the other programs combined with the

obstetrics and gynecology program are

for training a resident in primary care.

This provision is effective for residency

training programs beginning July 1,

1997. (Section 4627)

17. Payment Update for Excluded

Hospitals and Hospital Units. For FY

1998, the rate-of-increase limits for

excluded hospitals and units will be

updated by 0 percent. For FYs 1999

through 2002, the update factor is tied

to the relationship between the

hospital’s target amount and its

operating costs. For hospitals with costs

exceeding the target amount by 10

percent or more, the update is the

market basket percentage increase; if

costs exceed the target but by less than

10 percent, the update factor equals the

market basket percentage increase

minus 0.25 percentage points for each

percentage point by which costs are less

than 10 percent over the target (but in

no case less than 0); if costs are less than

or equal to the target but not below 2⁄3

of the target amount, the update is the

greater of 0 percent or the market basket

percentage increase minus 2.5

percentage points; and if costs do not

exceed 2⁄3 of the target amount, the

update factor is 0 percent. (Section

4411)

18. Reductions to Capital Payments.

Capital payment amounts for certain

excluded hospitals and hospital units

are reduced by 15 percent for FYs 1998

through 2002. (Section 4412)

19. Rebasing. A hospital that was

excluded from the prospective payment

system before 1991 may apply to rebase

its target amount for its cost reporting

period beginning in FY 1998. The

rebased target amount is determined by

using the five latest settled cost

reporting periods as of August 5, 1997,

updating for inflation, excluding the

highest and the lowest cost per

discharge, and calculating an average for

the remaining three. Long-term care

hospitals with costs exceeding 115

percent of their target amount and a 70-

percent disproportionate patient

percentage may elect to use the cost

reporting period beginning during FY

1996 as their base year, updated for

inflation. (Section 4413)

20. Cap on Target Amounts for

Excluded Hospitals and Units. For FYs

1998 through 2002, the target amount

will be capped at the 75th percentile of

the target amounts for similar facilities

for cost reporting periods ending during

FY 1996, updated by inflation. This cap

applies to psychiatric hospitals and

units, rehabilitation hospitals and units,

and long-term care hospitals.

21. Bonus and Relief Payments to

Excluded Hospitals and Units. Bonus

payments to excluded hospitals and

units are the lesser of—

• 15 percent of the amount by which

the ceiling (target amount times

Medicare discharges) exceeds the

amount of operating costs; or

• 2 percent of the ceiling.

A continuous improvement bonus

payment system is established

beginning FY 1998 for hospitals with at

least 3 full cost reporting periods whose

operating costs for the payment period

are less than the least of its target

amount, its trended costs (as defined by

the statute), or its expected costs (as

defined by the statute). The bonus under

this system equals the lesser of—

• 50 percent of the amount by which

operating costs are less than expected

costs; or

• 1 percent of the ceiling.

Hospitals with costs over 110 percent

of their ceiling receive relief payments

equal to an additional 50 percent of the

amount by which costs exceed 110

percent of the ceiling, not to exceed 10

percent of the ceiling. (Section 4415)

22. Change in Payment and Target

Amount for New Providers. Effective

October 1, 1997, the new provider

exemptions for excluded hospitals are

eliminated except for children’s

hospitals. The amount of payment for a

new provider will be the lesser of

operating costs for the period, or 110

percent of the national median of the

target amount for hospitals in the same

class for cost reporting periods ending

in FY 1996, wage adjusted and updated

by the market basket percentage

increase to the fiscal year in which the

hospital first received payments.

(Section 4416 and 4419)

23. Treatment of Certain Long-Term

Care Hospitals. Long-term care hospitals

located in the same building or on the

same campus as another hospital and

that were in existence on September 30,

1995, are grandfathered in as hospitals

excluded from the prospective payment

system. This amendment applies to

discharges occurring on or after October

1, 1995. (Section 4417(a))

A hospital that first received payment

in 1986, has an average inpatient length

of stay greater than 20 days, and in its

12-month cost reporting period ending

in FY 1997, has 80 percent or more of

its annual Medicare discharges that

reflect a finding of neoplastic disease, is

excluded from the prospective payment

system as a long-term care hospital.

This provision applies to cost

reporting periods beginning on or after

August 5, 1997. (Section 4417(b))

24. Treatment of Certain Cancer

Hospitals. A hospital recognized as a

comprehensive cancer research center

by the National Cancer Institute of the

National Institutes of Health as of April

20, 1983; located in a State which, as of

December 19, 1989, was not operating a

demonstration project under section

1814(b); that applied for and was denied

classification on or before December 31,

1990; is licensed for less than 50 acute
45970 Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations

care beds; and demonstrates that at least

50 percent of its total discharge reflects

a finding of neoplastic disease for the 4-

year period ending December 31, 1996,

is excluded from the hospital

prospective payment system

retroactively to 1991. The legislation

includes an option to rebase payments.

Retroactive payments must be made by

August 5, 1998. (Section 4418)

25. Limited-Service Rural Hospital

Program

A ‘‘Medicare Rural Hospital

Flexibility Program’’ is established. This

program is a national limited-service

hospital program that replaces the

existing Essential Access Community

Hospital/Rural Primary Care Hospital

(EACH/RPCH) program which operates

in seven States. The program allows

States to designate rural facilities as

‘‘critical access hospitals’’ if they are

located a sufficient distance from other

hospitals, make available 24-hour

emergency care, maintain no more than

15 inpatient beds, and keep inpatients

no longer than 96 hours (except where

weather or emergency conditions

dictate, or a Peer Review Organization

waives the limit). In addition, critical

access hospitals do not have to meet all

of the staffing requirements that apply

to hospitals under Medicare. Payment

for inpatient and outpatient services

under this program is on the basis of

reasonable cost.

States may receive grants for program

activities, and are authorized to provide

for the creation of networks, which

include at least one critical access

hospital and at least one acute care

hospital. Critical access hospitals with

swing-bed agreements are allowed to

have up to 25 inpatient beds and to

furnish both acute (hospital-level) and

SNF-level care, provided that no more

than 15 of those beds are used at any

one time for acute care. Existing RPCHs,

otherwise eligible as CAHs, and existing

medical assistance facilities (MAFs)

participating under the MAF

demonstration project in Montana, will

be deemed as CAHs. Existing EACHs in

rural areas will continue to be paid as

sole community hospitals but no new

EACHs will be designated. (Section

4201)

26. Change in Publication Dates.

Beginning with the FY 1999 update, the

DRG prospective payment rate

methodology and the recommended

hospital prospective payment updates

must be published as a proposed rule by

April 1 and as a final rule by August 1

of each year. (Section 4644 (a)(1) and

(b)(1))

As a conforming change, the deadline

for applications for geographic

reclassification for years beginning with

FY 2000 is moved from October 1 to

September 1. Because the FY 1999

applications are due on October 1, 1997,

the Secretary is directed to shorten the

deadlines for MGCRB decision making,

so that a final decision for all

applications is made by June 15, 1998.

(Section 4644(c))

Each of these provisions and the

changes to the regulations necessary to

implement these provisions are

described in greater detail in sections

III, IV, V, and VI of this preamble.

II. Changes to DRG Classifications and

Relative Weights

A. Background

Under the prospective payment

system, we pay for inpatient hospital

services on the basis of a rate per

discharge that varies by the DRG to

which a beneficiary’s stay is assigned.

The formula used to calculate payment

for a specific case takes an individual

hospital’s payment rate per case and

multiplies it by the weight of the DRG

to which the case is assigned. Each DRG

weight represents the average resources

required to care for cases in that

particular DRG relative to the average

resources used to treat cases in all

DRGs.

Congress recognized that it would be

necessary to recalculate the DRG

relative weights periodically to account

for changes in resource consumption.

Accordingly, section 1886(d)(4)(C) of

the Act requires that the Secretary

adjust the DRG classifications and

relative weights annually. These

adjustments are made to reflect changes

in treatment patterns, technology, and

any other factors that may change the

relative use of hospital resources. The

changes to the DRG classification

system and the recalibration of the DRG

weights for discharges occurring on or

after October 1, 1997 are discussed

below.

B. DRG Reclassification

1. General

Cases are classified into DRGs for

payment under the prospective payment

system based on the principal diagnosis,

up to eight additional diagnoses, and up

to six procedures performed during the

stay, as well as age, sex, and discharge

status of the patient. The diagnosis and

procedure information is reported by

the hospital using codes from the

International Classification of Diseases,

Ninth Edition, Clinical Modification

(ICD–9–CM). The Medicare fiscal

intermediary enters the information into

its claims system and subjects it to a

series of automated screens called the

Medicare Code Editor (MCE). These

screens are designed to identify cases

that require further review before

classification into a DRG can be

accomplished.

After screening through the MCE and

any further development of the claims,

cases are classified by the GROUPER

software program into the appropriate

DRG. The GROUPER program was

developed as a means of classifying

each case into a DRG on the basis of the

diagnosis and procedure codes and

demographic information (that is, sex,

age, and discharge status). It is used

both to classify past cases in order to

measure relative hospital resource

consumption to establish the DRG

weights and to classify current cases for

purposes of determining payment. The

records for all Medicare hospital

inpatient discharges are maintained in

the Medicare Provider Analysis and

Review (MedPAR) file. The data in this

file are used to evaluate possible DRG

classification changes and to recalibrate

the DRG weights.

Currently, cases are assigned to one of

492 DRGs in 25 major diagnostic

categories (MDCs). Most MDCs are

based on a particular organ system of

the body (for example, MDC 6, Diseases

and Disorders of the Digestive System);

however, some MDCs are not

constructed on this basis since they

involve multiple organ systems (for

example, MDC 22, Burns).

In general, principal diagnosis

determines MDC assignment. However,

there are five DRGs to which cases are

assigned on the basis of procedure codes

rather than first assigning them to an

MDC based on the principal diagnosis.

These are the DRGs for liver, bone

marrow, and lung transplant (DRGs 480,

481, and 495, respectively) and the two

DRGs for tracheostomies (DRGs 482 and

483). Cases are assigned to these DRGs

before classification to an MDC.

Within most MDCs, cases are then

divided into surgical DRGs (based on a

surgical hierarchy that orders individual

procedures or groups of procedures by

resource intensity) and medical DRGs.

Medical DRGs generally are

differentiated on the basis of diagnosis

and age. Some surgical and medical

DRGs are further differentiated based on

the presence or absence of

complications or comorbidities

(hereafter CC).

Generally, GROUPER does not

consider other procedures; that is,

nonsurgical procedures or minor

surgical procedures generally not

performed in an operating room are not

listed as operating room (OR)

procedures in the GROUPER decision

tables. However, there are a few non-OR

procedures that do affect DRG
Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations 45971

1A single title combined with two DRG numbers

is used to signify pairs. Generally, the first DRG is

for cases with CC and the second DRG is for cases

without CC. If a third number is included, it

represents cases of patients who are age 0–17.

Occasionally, a pair of DRGs is split on age >17 and

age 0–17.

assignment for certain principal

diagnoses, such as extracorporeal shock

wave lithotripsy for patients with a

principal diagnosis of urinary stones.

We proposed several changes to the

DRG classification system for FY 1998.

The proposed changes, the comments

we received concerning them, our

responses to those comments, and the

final DRG changes are set forth below.

2. MDC 1 (Diseases and Disorders of the

Nervous System)

a. Stereotactic Radiosurgery

Effective October 1, 1995, procedure

code 92.3 (stereotactic radiosurgery) was

created and classified as a non-OR

procedure. However, because this

procedure had previously been coded to

procedure codes that are classified as

operating room procedures, we assigned

procedure code 92.3 to the same

surgical DRGs as the predecessor codes.

Therefore, in the following DRGs,

stereotactic radiosurgery is considered a

non-OR procedure that affects DRG

assignment: in MDC 1, DRG 1

(Craniotomy Age >17 Except for

Trauma), DRG 2 (Craniotomy for

Trauma Age >17), and DRG 3

(Craniotomy Age 0–17) and, in MDC 10

(Endocrine, Nutritional and Metabolic

Diseases and Disorders), DRG 286

(Adrenal and Pituitary Procedures). In

addition, in MDC 17 (Myeloproliferative

Diseases and Disorders and Poorly

Differentiated Neoplasms), procedure

code 92.3 is considered a major OR

procedure for purposes of assignment to

DRG 400 (Lymphoma and Leukemia

with Major OR Procedure) and DRGs

406 and 407 (Myeloproliferative

Disorders or Poorly Differentiated

Neoplasms with Major OR Procedure).1

We stated in the June 2, 1995 proposed

rule (60 FR 29207) that we would

analyze the stereotactic radiosurgery

cases as soon as the FY 1996 cases were

available to ensure that these DRG

assignments were appropriate.

In analyzing the FY 1996 MedPAR

file, we found that there were

stereotactic radiosurgery cases assigned

to DRGs 1, 286, 400, and 407. In DRG

1, the average standardized charges for

these cases are approximately $16,400

compared to approximately $27,800 for

DRG 1 overall and the lengths of stay are

about 3 days and 10 days, respectively.

In DRG 286, the average charges for

procedure code 92.3 are also much

lower than all cases in that DRG, about

$11,900 versus $19,400. Again the

length of stay is also much lower for

stereotactic radiosurgery, just over 1 day

compared to almost 7 days for all DRG

286 cases.

Because the cases associated with

procedure code 92.3 clearly are much

less resource-intensive than the other

cases in the DRGs to which it is

assigned, we proposed to reassign

procedure code 92.3 to DRGs 7 and 8

(Peripheral and Cranial Nerve and Other

Nervous System Procedures) in MDC 1

and DRGs 292 and 293 (Other

Endocrine, Nutrition and Metabolic OR

Procedures) in MDC 10. We also

proposed to remove procedure code

92.3 from the list of major OR

procedures in MDC 17. Therefore, these

cases would be assigned to DRGs 401

and 402 (Lymphoma and Non-Acute

Leukemia with Other OR Procedure)

and DRG 408 (Myeloproliferative

Disorders or Poorly Differentiated

Neoplasms with Other OR Procedure).

We received over 130 comments

regarding our proposal to move

procedure code 92.3, including many

from people who underwent

radiosurgery. Three commenters

supported the proposal. One commenter

concurred that a revision of the DRG

assignment and payment level for

radiosurgery is appropriate, but

suggested that any change be delayed

until further analysis of industry data

has been conducted. The remaining

commenters opposed our proposal and

strongly recommended that stereotactic

radiosurgery cases continue to be

assigned to DRG 1, or if a change must

be made, these cases should be assigned

to their own DRG with an appropriate

relative weight. The specific comments

we received are discussed below.

Comment: Many commenters stated

that stereotactic radiosurgery is cost

effective and is less expensive (by

approximately 1⁄3) than open cranial

surgery. The commenters were

concerned that this proposal would

result in a 40 percent reduction in

payment for these cases.

Response: Currently, stereotactic

radiosurgery is being paid at the same

level as open cranial surgery, as the

commenter noted. We believe these

comments support our decision to move

the radiosurgery cases into a DRG with

cases of comparable utilization of

resources, rather than group them with

open surgery procedures, which involve

much greater resource use. Our intent is

not to discourage the utilization of this

advanced technology nor to reduce

payment arbitrarily, but to make

appropriate payment for the procedure

by assigning it to a DRG with similar

resource use.

Comment: There are several different

approaches being used in stereotactic

radiosurgery. The two most prevalent

are the gamma knife and the linear

accelerator. Some commenters believe

that we should be analyzing these cases

separately and possibly making different

DRG assignments for them. Other

commenters urged us not to distinguish

between approaches in radiosurgery,

and one of these commenters submitted

data to demonstrate that there is no

difference in patient outcomes and that

the different types of approach are

clinically similar.

Response: Effective October 1, 1995, a

new ICD–9–CM procedure code was

created to capture stereotactic

radiosurgery. The new code 92.3

(Stereotactic radiosurgery) encompasses

both gamma knife and linear accelerator

procedures. This topic was addressed at

a public meeting of the ICD–9–CM

Coordination and Maintenance

Committee in 1994 at which

representatives from the radiosurgery

industry were in attendance. Comments

were accepted at the meeting and

attendees were also invited to submit

written comments. At that time, we did

not receive any negative comments

regarding the inclusion of all

approaches to radiosurgery in one code.

Therefore, with only one code, we are

unable to distinguish the radiosurgery

cases based on different approaches.

We note that one difference between

the approaches is the initial capital

costs of the equipment. However, now

that capital payments are made to

hospitals under a prospective payment

system, there is no way for us to

specifically recognize these different

costs.

Comment: Several commenters stated

that because most radiosurgery patients

do not have complicating conditions,

which are necessary to be assigned to

DRG 7, most cases will be assigned to

DRG 8 and receive the lower relative

weight associated with less complicated

cases. In any event, the commenters

believe that the payment for DRGs 7 and

8 is less than the costs of providing the

treatment. One commenter stated that

the average payment for radiosurgery

cases assigned to DRG 1 in FY 1996 was

$11,876.28, while payment for DRGs 7

and 8 in the same year averaged

$9,973.13 and $4,547.64, respectively.

Therefore, this proposal could reduce

hospital payment for the average

Medicare radiosurgery cases in DRG 1

by as much as 62 percent.

Response: We have performed an

analysis of the full FY 1996 MedPAR

file, updated through June 1997. Of the

1,275 cases coded with procedure 93.2,

966 cases would have been assigned to
45972 Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations

DRGs 7 and 8 under our proposal. Of

those 966 cases, 406 classify to DRG 7

and 560 cases classify to DRG 8. The

average charges of these reassigned

cases are approximately $16,300 for

DRG 7 and $13,700 for DRG 8. The

average standardized charges for DRG 7

and 8 overall are approximately $20,250

and $9,950, respectively. Thus, the

average charges for radiosurgery cases

assigned to DRG 7 (just over 40 percent

of the total) are approximately $4,000

less than the overall cases assigned to

that DRG and the average charges for the

cases assigned to DRG 8 are

approximately $4,000 more than the

overall cases.

Therefore, given a similar distribution

at any hospital, the payments for the

DRG 7 and 8 cases should come close

to balancing out; that is, DRG 7 will

result in payments in excess of costs

and DRG 8 will result in approximately

equal numbers of cases with costs in

excess of payments. This is consistent

with the design of the prospective

payment system, which is intended to

make an average, predetermined

payment for each case that encourages

hospitals to provide care efficiently and

economically and treat a mix of patients

so that cases incurring payments in

excess of costs are balanced by cases

incurring costs in excess of payments.

The difference between assignment to

DRG 7 and DRG 8 is the documentation

of complications resulting from

treatment or comorbidities that are

present upon admission and may affect

treatment. Examples of these secondary

diagnoses that, in fact, many of the

patients who commented reported

having are postoperative nausea (which

may prolong the patient’s stay),

diabetes, congestive heart failure, and

emphysema. In fact, commenters stated

that one of the advantages of

radiosurgery over open surgery is that it

can be performed on patients with

comorbidities who could not otherwise

tolerate surgery for their conditions.

We also note that DRGs 1 and 2 are

not split on the basis of CCs; rather, they

are assigned based on whether the case

is or is not a trauma case. Therefore,

hospitals might not have coded

secondary diagnoses for radiosurgery

cases. Nonetheless, over 40 percent of

the reassigned cases in our analysis

have CCs included on the bill. We

believe this will remain true in FY 1998

and the percentage may even increase

now that properly coding CCs will affect

the amount of payment.

In response to the commenter

concerned about the low payment for

DRGs 7 and 8, we note that, based on

the MedPAR file, the average payment

for radiosurgery cases assigned to DRG

1 in FY 1996 was approximately

$16,000. If those cases had been

assigned to DRGs 7 and 8 in that year,

we estimate that the average payment

would have been approximately $14,000

and $8,000, respectively. Thus, on

average, payment for radiosurgery cases

will be reduced by approximately 30

percent. This is consistent with

commenter’s assertion that this

procedure costs approximately onethird less than an open cranial

procedure.

Comment: Commenters suggested that

instead of continuing to assign

radiosurgery cases to DRG 1, it would be

acceptable to assign these cases to their

own DRG and assign a weight of

approximately 3.0.

Response: As we have stated in

several previous documents, including

the June 2 proposed rule (in connection

with the discussion of automatic

implantable cardioverter defibrillators

(62 FR 29906)), we are reluctant to

create device-specific DRGs where the

cost of the device dominates the

charges. Creating a separate DRG for

radiosurgery, where the costs of the

device used to perform the procedure

dominates the charges, would be a

similar issue. With such a procedurespecific DRG, it would be relatively easy

for hospitals and manufacturers of the

equipment to raise the charges for the

cases until they create a relative weight

that consistently pays them more than

their costs. We believe that the resource

consumption associated with cases in

DRGs 7 and 8 is similar to that required

by radiosurgery cases. However, we will

continue to monitor this technology to

ensure that these DRGs remain

appropriate assignments.

Comment: Several commenters

believe that the relatively low charges of

the radiosurgery cases result, in part,

from incorrect use of procedure code

92.3. These commenters requested that

we either wait until these issues are

resolved to make a DRG change or that

we adjust the cases in the MedPAR file

based on industry data.

Response: It is often the case with a

new code, whether diagnosis or

procedure, that there is a period of time

necessary to gain experience and

correctly use the code. We did notice

some coding discrepancies when we

reviewed the radiosurgery cases.

However, these discrepancies are not in

the cases that are assigned to DRGs 7

and 8, but rather the cases that remain

assigned to DRG 1. We note that coders

appear to be including improperly the

approach to the radiosurgery procedure,

such as coding thalamotomy and

pallidotomy separately in addition to

the stereotactic radiosurgery code. In

addition, the coding of some cases has

included codes that represent the result

of the radiosurgery, that is, the

destruction of the lesion of the brain.

Again this is an improper coding

practice. Both of these coding practices

result in radiosurgery cases being

assigned to DRG 1.

We will continue to monitor these

cases to ensure that our decision to

reassign radiosurgery to DRGs 7 and 8

remains appropriate. We will also work

with the industry concerning the

possibility of assigning separate ICD–9–

CM codes to the different types of

radiosurgery.

b. Sleep Apnea

In our August 30, 1996 final rule (61

FR 46168), we discussed our review of

the DRG assignment of cases in which

surgery is performed to correct

obstructive sleep apnea (diagnosis code

780.57). When coded as the principal

diagnosis, sleep apnea is assigned to

DRGs 34 and 35 (Other Disorders of the

Nervous System) in MDC 1.

The result of our review was to assign

several surgical procedures used to

correct sleep apnea to DRGs 7 and 8

(Peripheral and Cranial Nerve and Other

Nervous System Procedures). These

procedures involved repair of the palate

or pharynx (procedure codes 27.69,

29.4, and 29.59). Previously, since none

of these surgical procedures had been

assigned to MDC 1, cases of sleep apnea

treated with one of these procedures

had been assigned to DRG 468

(Extensive OR Procedure Unrelated to

Principal Diagnosis) or DRG 477

(Nonextensive OR Procedure Unrelated

to Principal Diagnosis).

An associated procedure that is also

used to treat sleep apnea is correction of

cleft palate (procedure code 27.62).

Currently, correction of cleft palate is

assigned only to DRG 52 (Cleft Lip and

Palate Repair) in MDC 3 (Diseases and

Disorders of the Ear, Nose, Mouth, and

Throat). Thus, when this procedure is

performed for sleep apnea cases, the

cases would be assigned to DRG 468.

We proposed to add this surgical

procedure to MDC 1. Like the palate and

pharynx repair procedures that were

addressed last year, these cases are not

clinically similar to the other surgical

DRGs in MDC 1; thus, we proposed to

include them in DRGs 7 and 8.

Comment: We received three

comments on this proposal. One

commenter supported the change;

another registered no objection but

pointed out that the proposed rule

stated procedure code 27.62 is currently

assigned to DRG 477 (Nonextensive OR

Procedure Unrelated to Principal

Diagnosis) when the principal diagnosis
Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations 45973

is sleep apnea. The commenter noted

that under the current DRG groupings,

such a case would actually be assigned

to DRG 468. The final commenter stated

that if a patient is admitted for cleft

palate repair, the principal diagnosis

likely would be cleft palate (diagnosis

code 749.xx) even if sleep apnea is also

present, presumably resulting in

assignment to DRG 52. This commenter

suggested that if cleft palate repair is

performed infrequently in conjunction

with a principal diagnosis of obstructive

sleep apnea, it would be unnecessary to

reassign these cases to DRGs 7 and 8.

Response: In the proposed rule, we

inadvertently stated that sleep apnea

cases involving the correction of cleft

palate currently would be assigned to

DRG 477. The commenter is correct that

such cases are currently assigned to

DRG 468.

Although a patient admitted for cleft

palate repair would more likely have a

principal diagnosis of cleft palate than

of sleep apnea, cases do occur in which

obstructive sleep apnea is the

documented reason for the surgery. Our

rationale for the proposed change is

based not on the frequency of the cases

but on whether or not these cases are

appropriately assigned to DRG 468,

which by definition should encompass

only cases involving unrelated

operating room procedures. Because we

believe that cleft palate repair is related

to obstructive sleep apnea, it would be

inappropriate to continue to assign

these cases to DRG 468; the better policy

is to assign the procedure to DRGs 7 and

8 in MDC 1. Therefore, we are adopting

this change in this final rule.

c. Geniculate Herpes Zoster

Geniculate herpes zoster (diagnosis

code 053.11) is an acute viral disease

characterized by inflammation of spinal

ganglia and by a vesicular eruption

along the area of distribution of a

sensory nerve. In the August 30, 1996

final rule (61 FR 27447), we moved

diagnosis codes 053.10 and 053.19

(herpes zoster with unspecified nervous

system complication and other herpes

zoster, respectively) from DRG 20

(Nervous System Infection Except Viral

Meningitis) to DRGs 18 and 19 (Cranial

and Peripheral Nerve Disorders). We

considered moving diagnosis code

053.11 at that time, however, the higher

average charges associated with

geniculate herpes zoster and slightly

higher length of stay led us to decide

instead to leave 053.11 in DRG 20 and

to reassess this decision in upcoming

years.

For the proposed rule, we conducted

an analysis of the cases assigned to DRG

20 using the FY 1996 MedPAR file. The

average standardized charges for these

cases were approximately $8,430,

significantly lower than the average

charges for the DRG of approximately

$21,180. The average length of stay for

the geniculate herpes zoster cases,

approximately 6 days, was also less than

the average length of stay for DRG 20 of

approximately 10 days. Based on these

data, we proposed to reassign diagnosis

code 053.11 to DRGs 18 and 19, which

have average charges of approximately

$8,460 and $5,460, respectively. The

average length of stay for DRGs 18 and

19 was approximately 6 days and 4

days, respectively.

We received two comments

supporting this change and we are

including it in the final DRG changes.

3. MDC 5 (Diseases and Disorders of the

Circulatory System)

a. Heart Assist Devices

In November 1995, we amended our

general noncoverage decision

concerning artificial hearts and related

devices. Section 65–15 of the Medicare

Coverage Issues manual was revised to

allow coverage of the HeartMate

Implantable Pneumatic Left Ventricular

Assist System (HeartMate IP LVAS) in

accordance with its Food and Drug

Administration (FDA)- approved use as

a temporary mechanical circulation

support in nonreversible left ventricular

failure as a bridge to cardiac transplant.

In order to receive Medicare coverage,

all of the following conditions must be

met:

• The patient is listed as an approved

heart transplant candidate by a

Medicare-approved heart transplant

center.

• The implantation of the system is

done in a Medicare-approved heart

transplant center. Written permission

from the listing center is needed if the

patient has the implantation done at

another Medicare-approved center.

• The patient is on inotropes.

• The patient is on an intra-aortic

balloon pump (if possible).

• The patient has left atrial pressure

or pulmonary capillary wedge pressure

≥ 20mm Hg with either—

—Systolic blood pressure ≤ 80 mm

Hg; or

—Cardiac index of ≤ 2.0 1/min/m2.

A procedure code for implant of an

implantable, pulsatile heart assist

system (37.66), which includes the

HeartMate IP LVAS, was created

effective October 1, 1995. At that time,

the procedure code was assigned to

DRGs 110 and 111 (Major

Cardiovascular Procedures). In the

proposed rule, we presented our

analysis of a full year of cases coded

with this procedure (FY 1996 MedPAR

file, December update) to determine if

this DRG assignment remained

appropriate.

In the full (100 percent) FY 1996

MedPAR file, there were 51 cases of

implant of an internal heart assist

system (procedure code 37.66) in MDC

5. Of these 51 cases, 18 were assigned

to DRG 110 and none to DRG 111. The

other 33 cases were assigned to DRG 103

(Heart Transplant), DRG 104 (Cardiac

Valve Procedures with Cardiac Cath),

DRGs 106 and 107 (Coronary Bypass),

and DRG 108 (Other Cardiothoracic

Procedures). Of the 18 cases assigned to

DRG 110, the average charge was about

$96,000 and the average length of stay

was 22.5 days. The average charges for

all cases assigned to DRG 110 was about

$36,500 and the average length of stay

was 10.1 days.

Thus, the cases coded with procedure

code 37.66 are much more resourceintensive than the other cases assigned

to DRG 110. In reviewing the other

surgical DRGs in MDC 5 for possible

reassignment of this procedure, we

identified two DRGs that contained

cases clinically similar to implant of

heart assist device cases: DRG 103 and

DRG 108. For FY 1996, the average

charge of cases in DRG 103 was

approximately $164,000 and the length

of stay was 46 days. For DRG 108, these

statistics were about $54,000 and 12.1

days. Thus, the average charge for DRG

103 was approximately $68,000 higher

than the average charge of the heart

assist device cases and the average

charge for DRG 108 was approximately

$42,000 lower.

Because our general policy is to assign

a procedure code to a DRG with

clinically similar cases that is the best

match in terms of resource use, we

proposed to assign procedure code

37.66 to DRG 108.

Comment: We received two comments

supporting this proposal. However,

several other commenters believe that

the only solution that would be

appropriate is to assign procedure code

37.66 either to DRG 103 or to its own

DRG. In support of this comment, they

cite the very high resource utilization

associated with the procedure. In

addition, one commenter believed that

failure to revise our proposal could limit

Medicare beneficiaries’ access to this

procedure.

Response: As noted in the proposed

rule, although reassignment of these

cases to DRG 108 does not place them

in a DRG with identical resource use, it

is the best alternative we have at this

time. As we discuss above in section

II.B.2.a. of this preamble concerning

radiosurgery, it has not been our
45974 Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations

practice to create device-specific DRGs.

Assignment of these cases to DRG 103

would be no more appropriate in terms

of resource use than reassignment to

DRG 108. In addition, we believe that

only transplant cases should be assigned

to that DRG. We will continue to

monitor these cases in future years. We

are also contemplating the feasibility of

conducting a comprehensive review of

the current surgical DRGs in MDC 5. We

last did this effective for FY 1991.

Because there have been so many

changes in approach to heart surgery in

the past few years as well as the

development of new devices and

techniques, we believe such a review

could help realign these cases in terms

of both clinical and resource use

homogeneity.

With regard to the statement that

failure to revise our proposal could

result in denial of heart assist devices to

Medicare beneficiaries, we note, as we

have in many previous documents, that

it is a violation of a hospital—s

Medicare provider agreement to place

restrictions on the number of Medicare

beneficiaries it accepts for treatment

unless it places the same restrictions on

all other patients.

We also note that, effective May 5,

1997, the coverage instructions

concerning heart assist devices were

revised to delete the specific product

names and the hemodynamic criteria

(Transmittal No. 94; April 1997). As

revised, section 65–15 of the Medicare

Coverage Issues Manual allows coverage

of a ventricular assist device used for

support of blood circulation

postcardiotomy if the device has

received approval from the FDA for that

purpose and the device is used

according to FDA-approved labeling

instructions or as a bridge to heart

transplant if all of the following

conditions are met:

• The device is used as a temporary

mechanical circulatory support as a

bridge to cardiac transplant.

• The patient is listed as an approved

heart transplant candidate by a

Medicare-approved heart transplant

center.

• The implantation of the system is

done in a Medicare-approved heart

transplant center. If the patient is listed

with another center, written permission

is needed from that center.

b. Automatic Implantable Cardioverter

Defibrillators (AICD)

For several years, we have received

correspondence concerning the

appropriate DRG assignment of

procedures involving automatic

implantable cardioverter defibrillators

(AICDs). These cases are currently

assigned to DRG 116 (Other Permanent

Cardiac Pacemaker Implant or AICD

Generator or Lead Procedure), and are

represented by the following procedure

codes:

37.95 Implantation of automatic

cardioverter/defibrillator lead(s) only

37.96 Implantation of automatic

cardioverter/defibrillator pulse

generator only

37.97 Replacement of automatic

cardioverter/defibrillator lead(s) only

37.98 Replacement of automatic

cardioverter/defibrillator pulse

generator only

As explained in detail in the

September 1, 1992 final rule (57 FR

39749), the clinical composition and

relative weights of the surgical DRGs in

MDC 5 do not offer a perfect match with

the AICD cases. However, review of

those DRGs in terms of clinical

coherence and similar resource

consumption led to the determination

that DRG 116 was the best possible fit.

In that document, we stated that we

would continue to monitor these cases.

We last discussed this issue in the

September 1, 1995 final rule (60 FR

45780). At that time, we concluded that,

although the average charge for AICD

cases was much higher than the average

charge for DRG 116 overall, the AICD

cases were clinically similar to the DRG

116 cases and should not be moved. In

addition, a slight decrease in the average

charge for the cases between the FY

1993 and FY 1994 MedPAR files led us

to believe further reductions might be

forthcoming since there were new AICD

devices entering the market that might

lead to increased price competition.

For the proposed rule, we reviewed

the most current AICD cases as

contained in the FY 1996 MedPAR file

and found that the average standardized

charge for AICD cases assigned to DRG

116 was $28,777 compared to an

average charge of $21,330 for all cases

in DRG 116. Because the average charge

for AICD cases continued to be much

higher than the average charge for all

other DRG 116 cases, we proposed to

move them to DRG 115 (Permanent

Cardiac Pacemaker Implantation with

AMI, Heart Failure or Shock). We also

proposed to revise the title of DRG 115

to ‘‘Permanent Cardiac Pacemaker

Implant with AMI, Heart Failure or

Shock or AICD Lead or Generator

Procedure.’’

We received several comments

commending us on this decision and we

are adopting it as final.

c. Coronary Artery Stent

Effective October 1, 1995, procedure

code 36.06 (Insertion of coronary artery

stent(s)) was introduced. As dictated by

our longstanding practice, we assigned

this code to the same DRG category as

its predecessor codes. Therefore,

procedure code 36.06 was assigned to

DRG 112 (Percutaneous Cardiovascular

Procedures), as insertion of a stent is

usually performed in conjunction with

percutaneous transluminal coronary

angioplasty (PTCA).

We discussed this assignment and

public comments we received in both

the September 1, 1995 final rule (60 FR

45785) and the August 30, 1996 final

rule (61 FR 46171). We stated that we

would review the stent cases as soon as

the FY 1996 MedPAR file was available,

as these would be the first Medicare

data available for these cases.

As discussed in the proposed rule,

our analysis of the FY 1996 MedPAR

data on coronary stent implantation in

Medicare beneficiaries revealed the

following:

• The difference between the average

length of stay for the stent cases and the

nonstent cases was 0.19 days (4.39 days

versus 4.20 days).

• Charges for patients receiving a

stent were approximately $23,650,

while charges for patients without stent

implant were approximately $17,480,

for a difference of $6,170.

• Of those beneficiaries who had a

PTCA procedure in FY 1996,

approximately 34 percent received a

stent.

Based on the significant variation in

hospital charges between stent and

nonstent cases in DRG 112, we proposed

to move these cases out of that DRG.

Although the coronary artery stent cases

are not clinically similar to the

pacemaker cases in DRG 116, the

resource consumption of those cases is

very similar. Therefore, absent any other

appropriate DRG, we proposed to add to

DRG 116 those cases including

procedure codes for PTCA in

combination with insertion of coronary

stent. Specifically, we proposed to move

into DRG 116 the following procedure

codes when performed in conjunction

with procedure code 36.06:

35.96 Percutaneous valvuloplasty

36.01 Single vessel percutaneous

transluminal coronary angioplasty

[PTCA] or coronary atherectomy

without mention of thrombolytic

agent

36.02 Single vessel percutaneous

transluminal coronary angioplasty

[PTCA] or coronary atherectomy with

mention of thrombolytic agent

36.05 Multiple vessel percutaneous

transluminal coronary angioplasty

[PTCA] or coronary atherectomy

performed during the same operation,

with or without mention of

thrombolytic agent
Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations 45975

36.09 Other removal of coronary artery

obstruction

37.34 Catheter ablation of lesion or

tissues of the heart

We also proposed to change the title

of DRG 116 to ‘‘Other Permanent

Cardiac Pacemaker Implant or PTCA

with Coronary Artery Stent Implant.’’

Comment: We received many

comments in support of this move.

Commenters cited increased payment

for use of coronary stenting in

appropriate patients as a rational

response to an economic dilemma. One

commenter requested that consideration

be given to increased payment for the

cost of the stents themselves within

DRG 116 for those cases in which

multiple stents are implanted in the

same operative episode.

Response: We appreciate the positive

responses generated by this proposal.

With regard to the request for

modification of DRG 116 to take into

account the use of more than one stent

per patient, we would remind the

commenter that one of the parameters of

the prospective payment system is

predetermined, identical payments for

each discharge in a DRG. To arbitrarily

begin to increase payment based on the

number of stents used in a procedure

would undermine the system. We will

continue to monitor the stent cases and

the assignment to DRG 116. If PTCA

cases with stent become a higher

percentage of the PTCA cases or the

average charge for stent cases falls, we

may reconsider this assignment.

Comment: There were several

commenters who, while supporting the

proposal to increase increasing stent

payment, also chided us for our lack of

foresight in neglecting to consider new

drug therapies in conjunction with

PTCA. The pharmaceutical referenced

in these comments is a category of drugs

called glycoprotein (GP) IIb/IIIa

inhibitors, which act to reduce platelet

aggregation, thereby reducing death rate,

recurrent heart attack, and further

surgery.

Commenters suggested that HCFA

take immediate steps to establish a

procedure code describing infusion of

GPIIb/IIIa therapy. They further

suggested that if the agency’s required

lead time for revising an existing ICD–

9–CM code, or creating a new code for

platelet inhibitor therapy, precluded a

new code from being effective this

October 1, then HCFA should create a

temporary code that hospitals could use

until a new ICD–9–CM code could

become effective. It was suggested that

such a temporary code would allow the

reclassification of angioplasty with

GPIIb/IIIa usage into DRG 116 to be

effective October 1, 1997.

Response: We appreciate the

suggestion that the category of GPIIb/IIIa

platelet inhibitor drugs be uniquely

identified in the ICD–9–CM coding

system, but would also note that a writein campaign during a proposed rule

comment period does not permit us to

respond to this request in a responsible

manner. To quickly produce a

temporary code would be the equivalent

of producing a permanent code, but

would not include due process in order

to make it a meaningful addition to the

ICD–9–CM coding system.

We would point out that, effective

October 1, 1986, code 36.04

(intracoronary artery thrombolytic

infusion) was added to the procedure

coding system based on a proposal

made by a major pharmaceutical

company. As we rely heavily on

information from the public to make the

ICD–9–CM coding system responsive to

the coding needs of the hospital

industry, we anticipated that the

guidance, language, and suggestions

received from this pharmaceutical

company were current and timely. In

the interim, there has been no public

protest or demand for an ICD–9–CM

platelet inhibitor therapy code that

would better meet the needs of the

industry.

In retrospect, we regret that we

integrated this code as it does not

appear to have been an appropriate

addition to the coding system. We will

work with the drug and hospital

industry representatives to provide us

with more insight and better language as

we bring the topic of platelet inhibitors

before the ICD–9–CM Coordination and

Maintenance Committee on December 4,

1997. We would anticipate, therefore,

having an appropriate code describing

GPIIb/IIIa drug therapy early next year.

This code would be effective for

discharges on or after October 1, 1998.

d. Circulatory Disorders (DRGs 121 and

122)

In response to a comment on the May

31, 1996 proposed rule, we stated in the

August 30, 1996 final rule (61 FR 46172)

that we would conduct a comprehensive

review of cases currently assigned to

DRG 121 (Circulatory Disorders with

Acute Myocardial Infarction (AMI) and

Cardiovascular Complications,

Discharged Alive) and DRG 122

(Circulatory Disorders with AMI

without Cardiovascular Complications,

Discharged Alive) to determine whether

changes were needed to the list of

complicating conditions that can result

in assignment to DRG 121. Accordingly,

for the FY 1998 proposed rule, we

analyzed the cases in the FY 1996

MedPAR file that were assigned to

either DRG 121 or 122. Through a

variety of statistical analyses of length of

stay and standardized charge data, we

assessed the impact on resource use of

all coded secondary diagnoses.

Our analysis of these secondary

diagnosis codes revealed many cases

now assigned to DRG 122 in which

certain secondary diagnoses are

associated with resource use

comparable to cases assigned to DRG

121. Although many of these cases

involve secondary diagnoses that are not

strictly cardiovascular in nature, such as

diagnosis code category 482 (other

bacterial pneumonia), we now believe

that it is appropriate to expand DRG 121

to include such major complications

when they are represented in significant

volume among the cases in the DRG.

Continuing to limit DRG 121 only to

cases involving the existing list of

cardiovascular complications would

contribute to large variations in the

charges and lengths of stay for cases in

DRG 122.

Therefore, we proposed to change the

title of DRG 121 to ‘‘Circulatory

Disorders with AMI and Major

Complications, Discharged Alive,’’ and

to add the following diagnosis codes to

the list of complications that would

produce assignment to DRG 121 when

present in conjunction with the existing

list of AMI diagnoses:

398.91 Rheumatic heart failure

416.0 Primary pulmonary

hypertension

430 Subarachnoid hemorrhage

431 Intracerebral hemorrhage

432.0 Nontraumatic extradural

hemorrhage

432.1 Subdural hemorrhage

432.9 Unspecified intracranial

hemorrhage

433.01 Occluded basilar artery with

cerebral infarction

433.11 Occluded carotid artery with

cerebral infarction

433.21 Occluded vertebral artery with

cerebral infarction

433.31 Occluded multiple and

bilateral artery with cerebral

infarction

433.81 Occluded specified precerebral

artery with cerebral infarction

433.91 Occluded precerebral artery

NOS with cerebral infarction

434.00 Cerebral thrombosis

434.01 Cerebral thrombosis with

cerebral infarction

434.10 Cerebral embolism

434.11 Cerebral embolism with

cerebral infarction

434.90 Cerebral artery occlusion

434.91 Cerebral artery occlusion with

cerebral infarction

436 Acute, but ill-defined,

cerebrovascular disease
45976 Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations

481 Pneumococcal pneumonia

482.xx Other bacterial pneumonia (all

4th and 5th digits)

483.x Pneumonia due to other

specified organism (all 4th digits)

484.x Pneumonia in infectious

diseases classified elsewhere (all 4th

digits)

485 Bronchopneumonia, organism

unspecified

486 Pneumonia, organism unspecified

487.0 Influenza with pneumonia

507.x Pneumonitis due to solids and

liquids (all 4th digits)

518.0 Pulmonary collapse

518.5 Pulmonary insufficiency

following trauma and surgery

518.81 Respiratory failure

707.0 Decubitus ulcer

996.62 Infection and inflammatory

reaction due to other vascular device,

implant, and graft

996.72 Other complications due to

other cardiac device, implant, and

graft

We note that, in conjunction with the

proposed changes, we also proposed to

revise the title of DRG 122 to read

‘‘Circulatory Disorders with AMI

without Major Complications,

Discharged Alive.’’

We received four comments fully

supporting these proposed changes and

are including them in the final DRG

changes.

4. MDC 8 (Diseases and Disorders of the

Musculoskeletal System and Connective

Tissue)

a. Introduction

As discussed in detail below, we

proposed to create several new DRGs in

MDC 8 effective for discharges on or

after October 1, 1997. Specifically, we

proposed to replace current DRGs 214

and 215 (Back and Neck Procedures)

with the following new DRGs:

DRG 496 Combined Anterior/Posterior

Spinal Fusion

DRG 497 Spinal Fusion with CC

DRG 498 Spinal Fusion without CC

DRG 499 Back and Neck Procedures

Except Spinal Fusion with CC

DRG 500 Back and Neck Procedures

Except Spinal Fusion without CC

In addition, we proposed to replace

existing DRGs 221 and 222 (Knee

Procedures) with new DRGs 501 and

502 (Knee Procedures with Principal

Diagnosis of Infection) and DRG 503

(Knee Procedures without Principal

Diagnosis of Infection).

b. Back and Neck Procedures

Currently, hospital inpatient cases

involving back and neck procedures

generally are assigned to DRGs 214 and

215 (assuming a principal diagnosis that

groups the case to MDC 8). We have

received correspondence indicating that

within these DRGs, cases involving

spinal fusion procedures represent a

distinctly more complex and resourceintensive subset, and that payment

under DRGs 214 and 215 is inadequate

to cover the costs of treating patients

that require spinal fusion. Therefore, for

the proposed rule we conducted an

analysis of the cases assigned to DRGs

214 and 215 using the FY 1996 MedPAR

file.

Within our sample, cases involving

fusion procedures (procedure codes

81.00–81.09) constituted approximately

35 percent of cases in DRG 214 (Back

and Neck Procedures with CC) and 23

percent of those in DRG 215 (Back and

Neck Procedures without CC). In DRG

214, the average standardized charges

for the fusion cases were nearly double

the charges of the nonfusion cases

(approximately $25,300 versus $12,900).

There were also significant differences

in charges in DRG 215—$14,400 for

fusion cases and $8,500 for nonfusion

cases. Lengths of stay for fusion cases

were also longer, although not

dramatically so—7.1 days for fusion

cases versus 5.4 days for other cases in

DRG 214, and 3.8 days versus 3.1 days

in DRG 215. In view of the volume of

cases involved and the clear differences

in resource use, we concluded that it

would be appropriate to create

additional DRGs to separate spinal

fusion cases from the other back and

neck procedures.

Next, we expanded our analysis to

determine whether it would be

appropriate to subdivide the spinal

fusion cases according to whether both

anterior and posterior spinal fusion

were performed. This combination of

procedures, which involves fusing both

the front and rear of the vertebrae,

typically is performed on patients who

have had previous fusions that have not

bonded effectively or who have several

vertebrae that need extensive fusion on

both sides of the spine. As the table

below illustrates, the average charges

and lengths of stay for the cases

involving both anterior and posterior

spinal fusion were markedly greater

than for the other spinal fusion cases in

either DRG 214 or 215.

Type of case Avg.

charges

Average

length of

stay (in

days)

Anterior and posterior

spinal fusion .............. $51,200 12.3

DRG 214—Other spinal

fusion ......................... 24,300 6.9

Type of case Avg.

charges

Average

length of

stay (in

days)

DRG 215—Other spinal

fusion ......................... 14,300 3.8

Even though the cases in which both

anterior and posterior spinal fusions

were performed represented only about

3 percent of all spinal fusion cases in

our sample, we concluded that the

magnitude of the differences in both

average charges and lengths of stay

warranted a further subdivision of the

spinal fusion cases.

Based on this analysis, we proposed

to replace the two existing DRGs for

back and neck procedures with five new

DRGs. For ease of reference and

classification, current DRGs 214 and 215

would be made invalid and we would

establish new DRGs 496 through 500 to

contain all the cases that are currently

grouped in DRGs 214 and 215. We

believe that the division of these cases

into the new DRGs would improve

clinical coherence and provide for more

appropriate payment for both spinal

fusion cases and cases involving other

back and neck procedures.

Discharges would be assigned to each

of the five proposed DRGs as follows:

DRG 496 Combined Anterior/Posterior

Spinal Fusion

DRG 496 would include any

combination of procedure codes as

follows:

One or more of the following

procedure codes—

81.02 Other cervical fusion anterior

81.04 Dorsal/dorsulum fusion anterior

81.06 Lumbar/lumbosac fusion

anterior

and

One or more of the following

procedure codes—

81.03 Other cervical fusion posterior

81.05 Dorsal/dorsulum fusion

posterior

81.08 Lumbar/lumbosac fusion

posterior

DRGs 497 and 498 Spinal Fusion with

and without CC

DRGs 497 and 498 would include any

of the following procedure codes, as

long as any combination of procedure

codes would not otherwise result in

assignment to proposed DRG 496—

81.00 Spinal fusion NOS

81.01 Atlas-axis fusion

81.02 Other cervical fusion anterior

81.03 Other cervical fusion posterior

81.04 Dorsal/dorsulum fusion anterior

81.05 Dorsal/dorsulum fusion

posterior

81.06 Lumbar/lumbosac fusion

anterior
Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations 45977

81.07 Lumbar/lumbosac fusion lateral

81.08 Lumbar/lumbosac fusion

posterior

81.09 Refusion of spine

DRGs 499 and 500 Back and Neck

Procedures Except Spinal Fusion with

and without CC.

All procedure codes in current DRGs

214 and 215 other than procedure codes

81.00 through 81.09 would be assigned

to DRGs 499 and 500.

We received five comments in

support of this proposal. We are

adopting the proposed changes as final.

c. Knee Procedures

On several occasions, most recently in

our September 1, 1993 final rule (58 FR

46286), we have examined cases in DRG

209 (Major Joint and Limb Reattachment

of the Lower Extremity) to see whether

hip replacement cases that involve

infections or other complications should

be classified separately from the less

complicated cases in DRG 209. We have

found that the average charges and

lengths of stay for cases with principal

diagnoses of infection or complications

were only slightly higher than for all

cases in DRG 209. When we limited our

analysis to cases with a principal

diagnosis of infection, we found that the

cases had significantly higher charges

than for DRG 209 overall, but in view

of the small volume of cases (less than

0.5 percent of the total DRG 209 cases),

we decided that changes in the

classification of cases in DRG 209 were

not warranted.

In the proposed rule, at the request of

several correspondents, we revisited the

issue of whether DRG refinements are

needed to address differences in

resource use associated with orthopedic

procedures where deep infections are

present. To evaluate this issue, we

analyzed various classifications of cases

in MDC 8. We began by identifying all

cases with a principal diagnosis

indicating deep orthopedic infection of

the lower extremities or spine. The

diagnosis codes used were as follows:

711.05 Pyogenic arthritis pelvic region

and thigh

711.06 Pyogenic arthritis lower leg

711.07 Pyogenic arthritis ankle and

foot

711.08 Pyogenic arthritis other

specified sites

730.05 Acute osteomyelitis pelvic

region and thigh

730.06 Acute osteomyelitis lower leg

730.07 Acute osteomyelitis ankle and

foot

730.08 Acute osteomyelitis other

specified sites

730.15 Chronic osteomyelitis pelvic

region and thigh

730.16 Chronic osteomyelitis lower leg

730.17 Chronic osteomyelitis ankle

and foot

730.18 Chronic osteomyelitis other

specified sites

730.25 Unspecified osteomyelitis

pelvic region and thigh

730.26 Unspecified osteomyelitis

lower leg

730.27 Unspecified osteomyelitis

ankle and foot

730.28 Unspecified osteomyelitis other

specified sites

996.66 Infection and inflammatory

reaction due to internal joint

prosthesis

996.67 Infection and inflammatory

reaction due to other internal

orthopedic device

For each of the DRGs into which these

cases are grouped, we then compared

the average standardized charges and

average length of stay for cases with any

of the infection diagnoses listed above

with other cases in the DRGs. Unlike in

the past, we did not limit our analysis

to DRG 209 but examined all DRGs

within MDC 8 that focus on surgical

procedures of the lower extremities or

spine, including DRGs 209; 210, 211,

and 212 (Hip and Femur Procedures

Except Major Joint); 214 and 215 (Back

and Neck Procedures); and 221 and 222

(Knee Procedures).

For the most part, we again found that

these cases represented only a very

small proportion of the total cases in the

DRGs in question. In DRG 209, for

example, cases with one of the above

diagnosis codes as the principal

diagnosis continued to constitute less

than 1 percent of all cases in the DRG.

Moreover, although the average

standardized charges for the deep

infection cases ($24,834) were

approximately 21 percent higher than

the charges for the remaining cases in

the DRG ($19,297), the differences are

well within one standard deviation of

the average charge. Given the small

volume of cases, we again conclude that

changes in DRG 209 are not justified.

The only DRGs that we examined in

which cases with a principal diagnosis

of deep infection represented more than

1 percent of total cases in our sample

were DRGs 221 and 222. As illustrated

in the chart below, there are significant

differences in both average charges and

average length of stay between infection

cases in these DRGs and other cases in

the DRGs.

Type of case

Number

of

cases 1

Average

charges

(in dollars)

Average

length of

stay (in

days)

DRG 221 (all cases) ................................................................................................................................................... 451 16,529 7.2

DRG 221 with infection .............................................................................................................................................. 152 23,174 11.4

DRG 221 w/out infection ............................................................................................................................................ 299 13,151 5.1

DRG 222 (all cases) ................................................................................................................................................... 340 9,149 3.9

DRG 222 with infection .............................................................................................................................................. 37 14,452 7.0

DRG 222 w/out infection ............................................................................................................................................ 303 8,502 3.5

1Based on the 10-percent random sample of the FY 1996 MedPAR file.

Thus, more than one-third of cases in

DRG 221 had a principal diagnosis of

deep infection, the average length of

stay for these cases was more than twice

as long as for the remaining cases, and

average charges were approximately 76

percent higher. Similarly, for the 12

percent of total DRG 222 cases with

infection as the principal diagnosis, the

average length of stay was double that

for other cases, with average charges

approximately 70 percent higher. Given

the proportional volume of cases

involved, and the significant differences

in both average charges and length of

stay for infection cases in these DRGs,

we concluded that DRG refinements are

appropriate.

Based on this analysis, we proposed

to replace the two existing DRGs for

knee procedures with three new DRGs.

Again, for ease of reference and

classification, current DRGs 221 and 222

would be made invalid and we would

establish new DRGs 501 through 503 to

contain all the cases that are currently

grouped in DRGs 221 and 222.

Discharges would be assigned to each of

the three proposed DRGs as follows:

DRG 501 Knee Procedures with

Principal Diagnosis of Infection with

CC
45978 Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations

DRG 502 Knee Procedures with

Principal Diagnosis of Infection

without CC

DRG 501 and 502 would include any

of the operating room procedures now

assigned to DRGs 221 and 222, when the

principal diagnosis is any of the

following:

711.06 Pyogenic arthritis lower leg

730.06 Acute osteomyelitis lower leg

730.16 Chronic osteomyelitis lower leg

730.26 Unspecified osteomyelitis

lower leg

996.66 Infection and inflammatory

reaction due to internal joint

prosthesis

996.67 Infection and inflammatory

reaction due to other internal

orthopedic device

DRG 503 Knee Procedures without

Principal Diagnosis of Infection

DRG 503 would include any of the

operating room procedures now

assigned to DRGs 221 and 222 when the

principal diagnosis is not listed above

under DRGs 501 and 502.

Comment: We received four

comments in support of this proposed

change. One of the commenters

suggested that we also consider splitting

proposed DRG 503 into two DRGs to

distinguish between cases with and

without CCs.

Response: As shown in the table

above, based on the FY 1996 MedPAR

10 percent sample, the average charges

associated with cases in new DRG 503

are $13,151 for cases with CC and

$8,502 for cases without CC. The

average lengths of stay for DRG 503

cases with and without CC are 5.1 and

3.5 days, respectively. We note that the

mean standardized charges for this DRG

are approximately $10,100. Given the

similar lengths of stay for these two sets

of cases and the relatively small

magnitude of difference in average

charges (much less than one standard

deviation), we do not believe that

further division of the new DRG is

warranted. Thus, we are adopting the

new proposed DRGs for Knee

Procedures as final.

5. MDC 11 (Diseases and Disorders of

the Kidney and Urinary Tract)

Among the ICD–9–CM coding changes

that took effect October 1, 1995 was the

addition of new procedure code 59.72

(injection of implant into urethra or

bladder neck). Although this procedure

is not routinely performed in an

operating room, the code was previously

included within codes classified as

operating room procedures. Thus, as is

our practice, we assigned this procedure

code to the surgical DRGs to which the

procedure had formerly been assigned

as a non-OR procedure that affects DRG

assignment. Therefore, procedure code

59.72 was assigned to DRGs 308 and 309

(Minor Bladder Procedures) and DRG

356 (Female Reproductive System

Reconstructive Procedures).

In the June 2, 1995 proposed rule (60

FR 29209), we stated that we would

reevaluate the DRG classification of this

code when data on its use became

available for analysis in 2 years, that is,

in preparation for the FY 1998

rulemaking process. We indicated that

possible changes would include moving

the procedure code to a different

surgical DRG or classifying the code as

a non-OR procedure that did not affect

DRG assignment.

In the FY 1996 MedPAR file, there

were several cases with procedure code

59.72 assigned to DRGs 308 and 309.

The chart below compares average

charges and length of stay for cases in

these DRGs with and without the

injection procedure.

Type of case Number

of cases

Average

charge

(in dollars)

Average

length of

stay

(in days)

DRG 308

with procedure 59.72 5 6,978 4.2

DRG 308 w/

out procedure 59.72 910 13,254 6.5

DRG 309

with procedure 59.72 7 5,879 1.4

DRG 309 w/

out procedure 59.72 311 7,888 2.7

As the table illustrates, cases in which

injection of implant into the urethra or

bladder neck is the only relevant

procedure for DRG assignment purposes

constitute a very small minority of the

cases in DRGs 308 and 309. However,

these cases have lower average charges

and length of stay than other cases in

the DRGs. Thus, we proposed to

reclassify the procedure code as a nonOR procedure that does not affect DRG

assignment.

Under this proposal, cases currently

assigned to DRGs 308 and 309 because

of the performance of an implant

injection would be reassigned to

medical DRGs in MDC 11, primarily

either DRGs 320, 321, and 322 (Kidney

and Urinary Tract Infections) or DRGs

331 and 332 (Other Kidney and Urinary

Tract Diagnoses). Both of these sets of

DRGs have average charges closely in

line with the charges for cases in which

procedure 59.72 now determines DRG

assignment.

This change would also affect DRG

356 in MDC 13 (Diseases and Disorders

of the Female Reproductive System).

Within the 10 percent sample used for

this analysis, only 2 of the 2,689 cases

in DRG 356 were assigned based on the

presence of procedure code 59.72, and

as in DRGS 308 and 309, both the

average charges and length of stay were

lower than for other cases.

We received two comments in

support of this proposal and are

including it in the final DRG changes.

6. Surgical Hierarchies

Some inpatient stays entail multiple

surgical procedures, each one of which,

occurring by itself, could result in

assignment of the case to a different

DRG within the MDC to which the

principal diagnosis is assigned. It is,

therefore, necessary to have a decision

rule by which these cases are assigned

to a single DRG. The surgical hierarchy,

an ordering of surgical classes from

most to least resource intensive,

performs that function. Its application

ensures that cases involving multiple

surgical procedures are assigned to the

DRG associated with the most resourceintensive surgical class.

Because the relative resource intensity

of surgical classes can shift as a function

of DRG reclassification and

recalibration, we reviewed the surgical

hierarchy of each MDC, as we have for

previous reclassifications, to determine

if the ordering of classes coincided with

the intensity of resource utilization, as

measured by the same billing data used

to compute the DRG relative weights.

A surgical class can be composed of

one or more DRGs. For example, in

MDC 5, the surgical class ‘‘heart

transplant’’ consists of a single DRG

(DRG 103) and the class ‘‘coronary

bypass’’ consists of two DRGs (DRGs

106 and 107). Consequently, in many

cases, the surgical hierarchy has an

impact on more than one DRG. The

methodology for determining the most

resource-intensive surgical class,

therefore, involves weighting each DRG

for frequency to determine the average

resources for each surgical class. For

example, assume surgical class A

includes DRGs 1 and 2 and surgical

class B includes DRGs 3, 4, and 5, and

that the average charge of DRG 1 is

higher than that of DRG 3, but the

average charges of DRGs 4 and 5 are

higher than the average charge of DRG

2. To determine whether surgical class

A should be higher or lower than

surgical class B in the surgical

hierarchy, we would weight the average

charge of each DRG by frequency (that

is, by the number of cases in the DRG)

to determine average resource

consumption for the surgical class. The

surgical classes would then be ordered
Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations 45979

from the class with the highest average

resource utilization to that with the

lowest, with the exception of ‘‘other OR

procedures’’ as discussed below.

This methodology may occasionally

result in a case involving multiple

procedures being assigned to the lowerweighted DRG (in the highest, most

resource-intensive surgical class) of the

available alternatives. However, given

that the logic underlying the surgical

hierarchy provides that the GROUPER

searches for the procedure in the most

resource-intensive surgical class, this

result is unavoidable.

We note that, notwithstanding the

foregoing discussion, there are a few

instances when a surgical class with a

lower average relative weight is ordered

above a surgical class with a higher

average relative weight. For example,

the ‘‘other OR procedures’’ surgical

class is uniformly ordered last in the

surgical hierarchy of each MDC in

which it occurs, regardless of the fact

that the relative weight for the DRG or

DRGs in that surgical class may be

higher than that for other surgical

classes in the MDC. The ‘‘other OR

procedures’’ class is a group of

procedures that are least likely to be

related to the diagnoses in the MDC but

are occasionally performed on patients

with these diagnoses. Therefore, these

procedures should only be considered if

no other procedure more closely related

to the diagnoses in the MDC has been

performed.

A second example occurs when the

difference between the average weights

for two surgical classes is very small.

We have found that small differences

generally do not warrant reordering of

the hierarchy since, by virtue of the

hierarchy change, the relative weights

are likely to shift such that the higherordered surgical class has a lower

average weight than the class ordered

below it.

Based on the preliminary

recalibration of the DRGs, we proposed

to modify the surgical hierarchy as set

forth below. As we stated in the

September 1, 1989 final rule (54 FR

36457), we are unable to test the effects

of the proposed revisions to the surgical

hierarchy and to reflect these changes in

the proposed relative weights due to the

unavailability of revised GROUPER

software at the time this proposed rule

is prepared. Rather, we simulate most

major classification changes to

approximate the placement of cases

under the proposed reclassification and

then determine the average charge for

each DRG. These average charges then

serve as our best estimate of relative

resource use for each surgical class. We

test the proposed surgical hierarchy

changes after the revised GROUPER is

received and reflect the final changes in

the DRG relative weights in the final

rule.

We proposed to revise the surgical

hierarchy for the Pre-MDC DRGs, MDC

9 (Diseases and Disorders of the Skin,

Subcutaneous Tissue and Breast), MDC

10 (Endocrine, Nutritional and

Metabolic Diseases and Disorders), and

MDC 12 (Diseases and Disorders of the

Male Reproductive System) as follows:

• In the Pre-MDC DRGs, we would

reorder Bone Marrow Transplant (DRG

481) above Liver Transplant (DRG 480).

• In MDC 9, we would reorder

Perianal and Pilonidal Procedures (DRG

267) above Breast Procedures (DRGs

257–262).

• In MDC 10, we would reorder OR

Procedures for Obesity (DRG 288) above

Skin Graft and Wound Debridement

(DRG 287).

• In MDC 12, we would reorder

Circumcision (DRGs 342 and 343) above

Transurethral Prostatectomy (DRGs 336

and 337).

Based on a test of the proposed

changes using the most recent MedPAR

file and the revised GROUPER software,

we found that the proposed change to

the Pre-MDC DRGs, Bone Marrow

Transplant (DRG 481) above Liver

Transplant (DRG 480) is not supported

and this change will not be incorporated

in this final rule. The Pre-MDC DRGs

hierarchy will remain the same as in FY

1997.

We received one comment in support

of our surgical hierarchy proposals. We

also received one comment that

disagreed, as discussed below.

Comment: One commenter was

opposed to reordering Circumcision

(DRGs 342 and 343) above Transurethral

Prostatectomy (DRGs 336 and 337). The

commenter stated that circumcision

(procedure code 64.0) is the only

procedure in DRGs 342 and 343, and the

commenter believes that this procedure

is not as resource intensive or complex

as the procedures assigned to DRGs 336

and 337. The commenter suggested the

more appropriate assignment for a case

involving both a transurethral

prostatectomy and a circumcision

would be DRGs 336 and 337.

Response: Based on the Medicare

cases, the average standardized charges

for cases assigned to DRGs 342 and 343

is almost $7,000, which is higher than

the average standardized charges of

cases assigned to DRGs 336 and 337,

approximately $6,500. Thus, if a case

involves both a circumcision and a

prostatectomy, we believe it should be

assigned to the higher-weighted DRG

category. Although circumcision can be

a relatively simple surgery for infants,

when it is performed for Medicare

beneficiaries, it appears to be a more

complicated procedure and might

involve the use of significant resources.

The other proposed changes to the

surgical hierarchy are still supported by

the data and no additional changes are

indicated. Therefore, we are

incorporating these changes in this final

rule.

7. Refinement of Complications and

Comorbidities List

There is a standard list of diagnoses

that are considered complications or

comorbidities (CCs). We developed this

list using physician panels to include

those diagnoses that, when present as a

secondary condition, would be

considered a substantial complication or

comorbidity. In previous years, we have

made changes to the standard list of

CCs, either by adding new CCs or

deleting CCs already on the list.

In the September 1, 1987 final notice

concerning changes to the DRG

classification system (52 FR 33143), we

modified the GROUPER logic so that

certain diagnoses included on the

standard list of CCs would not be

considered a valid CC in combination

with a particular principal diagnosis.

Thus, we created the CC Exclusions

List. We made these changes to preclude

coding of CCs for closely related

conditions, to preclude duplicative

coding or inconsistent coding from

being treated as CCs, and to ensure that

cases are appropriately classified

between the complicated and

uncomplicated DRGs in a pair.

In the May 19, 1987 proposed notice

concerning changes to the DRG

classification system (52 FR 18877), we

explained that the excluded secondary

diagnoses were established using the

following five principles:

• Chronic and acute manifestations of

the same condition should not be

considered CCs for one another (as

subsequently corrected in the

September 1, 1987 final notice (52 FR

33154)).

• Specific and nonspecific (that is,

not otherwise specified (NOS))

diagnosis codes for a condition should

not be considered CCs for one another.

• Conditions that may not co-exist,

such as partial/total, unilateral/bilateral,

obstructed/unobstructed, and benign/

malignant, should not be considered

CCs for one another.

• The same condition in anatomically

proximal sites should not be considered

CCs for one another.

• Closely related conditions should

not be considered CCs for one another.

The creation of the CC Exclusions List

was a major project involving hundreds
45980 Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations

of codes. The FY 1988 revisions were

intended to be only a first step toward

refinement of the CC list in that the

criteria used for eliminating certain

diagnoses from consideration as CCs

were intended to identify only the most

obvious diagnoses that should not be

considered complications or

comorbidities of another diagnosis. For

that reason, and in light of comments

and questions on the CC list, we have

continued to review the remaining CCs

to identify additional exclusions and to

remove diagnoses from the master list

that have been shown not to meet the

definition of a CC. (See the September

30, 1988 final rule for the revision made

for the discharges occurring in FY 1989

(53 FR 38485); the September 1, 1989

final rule for the FY 1990 revision (54

FR 36552); the September 4, 1990 final

rule for the FY 1991 revision (55 FR

36126); the August 30, 1991 final rule

for the FY 1992 revision (56 FR 43209);

the September 1, 1992 final rule for the

FY 1993 revision (57 FR 39753); the

September 1, 1993 final rule for the FY

1994 revisions (58 FR 46278); the

September 1, 1994 final rule for the FY

1995 revisions (59 FR 45334); the

September 1, 1995 final rule for the FY

1996 revisions (60 FR 45782); and the

August 30, 1996 final rule for the FY

1997 revisions (61 FR 46171)).

We proposed a limited revision of the

CC Exclusions List to take into account

the changes that will be made in the

ICD–9–CM diagnosis coding system

effective October 1, 1997, as well as the

proposed CC changes described above.

(See section II.B.9, below, for a

discussion of ICD–9–CM changes.)

These changes were proposed in

accordance with the principles

established when we created the CC

Exclusions List in 1987. We received

one comment, which supported our

changes to the CC lists.

The changes discussed above have

been added to Table 6E, Additions to

the CC Exclusions List, in section V of

the Addendum to this final rule.

Tables 6E and 6F in section V of the

Addendum to this final rule contain the

revisions to the CC Exclusions List that

will be effective for discharges occurring

on or after October 1, 1997. Each table

shows the principal diagnoses with final

changes to the excluded CCs. Each of

these principal diagnoses is shown with

an asterisk and the additions or

deletions to the CC Exclusions List are

provided in an indented column

immediately following the affected

principal diagnosis.

CCs that are added to the list are in

Table 6E—Additions to the CC

Exclusions List. Beginning with

discharges on or after October 1, 1997,

the indented diagnoses will not be

recognized by the GROUPER as valid

CCs for the asterisked principal

diagnosis.

CCs that are deleted from the list are

in Table 6F—Deletions from the CC

Exclusions List. Beginning with

discharges on or after October 1, 1997

the indented diagnoses will be

recognized by the GROUPER as valid

CCs for the asterisked principal

diagnosis.

Copies of the original CC Exclusions

List applicable to FY 1988 can be

obtained from the National Technical

Information Service (NTIS) of the

Department of Commerce. It is available

in hard copy for $92.00 plus $6.00

shipping and handling and on

microfiche for $20.50, plus $4.00 for

shipping and handling. A request for the

FY 1988 CC Exclusions List (which

should include the identification

accession number, (PB) 88–133970)

should be made to the following

address: National Technical Information

Service; United States Department of

Commerce; 5285 Port Royal Road;

Springfield, Virginia 22161; or by

calling (703) 487–4650.

Users should be aware of the fact that

all revisions to the CC Exclusions List

(FYs 1989, 1990, 1991, 1992, 1993,

1994, 1995, 1996, and 1997) and those

in Tables 6E and 6F of this document

must be incorporated into the list

purchased from NTIS in order to obtain

the CC Exclusions List applicable for

discharges occurring on or after October

1, 1997.

Alternatively, the complete

documentation of the GROUPER logic,

including the current CC Exclusions

List, is available from 3M/Health

Information Systems (HIS), which,

under contract with HCFA, is

responsible for updating and

maintaining the GROUPER program.

The current DRG Definitions Manual,

Version 14.0, is available for $195.00,

which includes $15.00 for shipping and

handling. Version 15.0 of this manual,

which will include the final FY 1998

DRG changes, will be available in

October 1997 for $195.00. These

manuals may be obtained by writing

3M/HIS at the following address: 100

Barnes Road; Wallingford, Connecticut

06492; or by calling (203) 949–0303.

Please specify the revision or revisions

requested.

8. Review of Procedure Codes in DRGs

468, 476, and 477

Each year, we review cases assigned

to DRG 468 (Extensive OR Procedure

Unrelated to Principal Diagnosis), DRG

476 (Prostatic OR Procedure Unrelated

to Principal Diagnosis), and DRG 477

(Nonextensive OR Procedure Unrelated

to Principal Diagnosis) in order to

determine whether it would be

appropriate to change the procedures

assigned among these DRGs.

DRGs 468, 476, and 477 are reserved

for those cases in which none of the OR

procedures performed is related to the

principal diagnosis. These DRGs are

intended to capture atypical cases, that

is, those cases not occurring with

sufficient frequency to represent a

distinct, recognizable clinical group.

DRG 476 is assigned to those discharges

in which one or more of the following

prostatic procedures are performed and

are unrelated to the principal diagnosis:

60.0 Incision of prostate

60.12 Open biopsy of prostate

60.15 Biopsy of periprostatic tissue

60.18 Other diagnostic procedures on

prostate and periprostatic tissue

60.21 Transurethral prostatectomy

60.29 Other transurethral

prostatectomy

60.61 Local excision of lesion of

prostate

60.69 Prostatectomy NEC

60.81 Incision of periprostatic tissue

60.82 Excision of periprostatic tissue

60.93 Repair of prostate

60.94 Control of (postoperative)

hemorrhage of prostate

60.95 Transurethral balloon dilation of

the prostatic urethra

60.99 Other operations on prostate

All remaining OR procedures are

assigned to DRGs 468 and 477, with

DRG 477 assigned to those discharges in

which the only procedures performed

are nonextensive procedures that are

unrelated to the principal diagnosis.

The original list of the ICD–9–CM

procedure codes for the procedures we

consider nonextensive procedures if

performed with an unrelated principal

diagnosis was published in Table 6C in

section IV of the Addendum to the

September 30, 1988 final rule (53 FR

38591). As part of the final rules

published on September 4, 1990, August

30, 1991, September 1, 1992, September

1, 1993, September 1, 1994, September

1, 1995, and August 30, 1996, we moved

several other procedures from DRG 468

to 477. (See 55 FR 36135, 56 FR 43212,

57 FR 23625, 58 FR 46279, 59 FR 45336,

60 FR 45783, and 61 FR 46173,

respectively.)

a. Adding Procedure Codes to MDCs

We annually conduct a review of

procedures producing DRG 468 or 477

assignments on the basis of volume of

cases in these DRGs with each

procedure. Our medical consultants

then identify those procedures

occurring in conjunction with certain
Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations 45981

principal diagnoses with sufficient

frequency to justify adding them to one

of the surgical DRGs for the MDC in

which the diagnosis falls. Based on this

year’s review, we proposed to move

procedure code 54.92 (Removal of

foreign body from peritoneal cavity) to

MDC 11 and assign it to DRG 315 (Other

Kidney and Urinary Tract OR

Procedures). We note that, under the

current DRGs, when procedure code

54.92 is coded in addition to a principal

diagnosis code of 868.14 (injury with

open wound into retroperitoneum), the

case is assigned to DRG 468.

Comment: We received two comments

on this proposed change. One

commenter fully supported the

proposal. The other commenter noted

that moving procedure code 54.92 from

DRG 468 to DRG 315 in MDC 11 would

result in a 43 percent reduction in the

DRG relative weight associated with the

case. Although the change makes sense

clinically, the commenter questioned

the financial impact involved.

Response: The purpose of DRG 468 is

to accommodate cases in which an OR

procedure that is unrelated to the

principal diagnosis is performed. As the

commenter acknowledges, the clinical

relationship between procedure code

54.92 (Removal of foreign body from

peritoneal cavity) and a principal

diagnosis code of 868.14 (injury with

open wound into retroperitoneum) is

clear. We note that this change would

have resulted in the reassignment of

only one case in FY 1996; therefore, the

financial impact involved is minimal.

We are adopting this change as

proposed.

b. Reassignment of Procedures Among

DRGs 468, 476, and 477

We also reviewed the list of

procedures that produce assignments to

DRGs 468, 476, and 477 to ascertain if

any of those procedures should be

moved from one of these DRGs to

another based on average charges and

length of stay. Generally, we move only

those procedures for which we have an

adequate number of discharges to

analyze the data.

In reviewing the list of OR procedures

that produce DRG 468 assignments, we

analyzed the average charge and length

of stay data for cases assigned to that

DRG to identify those procedures that

are more similar to the discharges that

currently group to either DRG 476 or

477. We identified two procedures—

other surgical occlusion of abdominal

arteries (procedure code 38.86) and

other arthrotomy of knee (procedure

code 80.16)—that are significantly less

resource intensive than the other

procedures assigned to DRG 468.

Therefore, we proposed to move

procedure codes 38.86 and 80.16 to the

list of procedures that result in

assignment to DRG 477.

In reviewing the list of procedures

assigned to DRG 477, we did not

identify any procedures that should be

assigned to either DRG 468 or 476.

Comment: We received two comments

on this proposal. Both commenters

supported moving procedure code

80.16, but one of the commenters

believes that procedure code 38.86

represents cases that are very

complicated and require a high level of

resources.

Response: Our review of the average

resource use associated with DRG 468

cases with procedure code 38.86

support this change. The average charge

associated with this case is

approximately $13,150. The average

charges for cases in DRG 468 and 477

are approximately $30,000 and $14,300,

respectively. Thus, moving procedure

code 38.86 to DRG 477 appears

appropriate in terms of resource use. We

will review the cases in the FY 1997

MedPAR file when it becomes available

to ensure that this remains true for those

cases.

9. Changes to the ICD–9–CM Coding

System

As discussed above in section II.B.1 of

this preamble, the ICD–9–CM is a

coding system that is used for the

reporting of diagnoses and procedures

performed on a patient. In September

1985, the ICD–9–CM Coordination and

Maintenance Committee was formed.

This is a Federal interdepartmental

committee charged with the mission of

maintaining and updating the ICD–9–

CM. That mission includes approving

coding changes, and developing errata,

addenda, and other modifications to the

ICD–9–CM to reflect newly developed

procedures and technologies and newly

identified diseases. The Committee is

also responsible for promoting the use

of Federal and non-Federal educational

programs and other communication

techniques with a view toward

standardizing coding applications and

upgrading the quality of the

classification system.

The Committee is co-chaired by the

National Center for Health Statistics

(NCHS) and HCFA. The NCHS has lead

responsibility for the ICD–9–CM

diagnosis codes included in Volume 1—

Diseases: Tabular List and Volume 2—

Diseases: Alphabetic Index, while

HCFA has lead responsibility for the

ICD–9–CM procedure codes included in

Volume 3—Procedures: Tabular List

and Alphabetic Index.

The Committee encourages

participation in the above process by

health-related organizations. In this

regard, the Committee holds public

meetings for discussion of educational

issues and proposed coding changes.

These meetings provide an opportunity

for representatives of recognized

organizations in the coding fields, such

as the American Health Information

Management Association (AHIMA)

(formerly American Medical Record

Association (AMRA)), the American

Hospital Association (AHA), and

various physician specialty groups as

well as physicians, medical record

administrators, health information

management professionals, and other

members of the public to contribute

ideas on coding matters. After

considering the opinions expressed at

the public meetings and in writing, the

Committee formulates

recommendations, which then must be

approved by the agencies.

The Committee presented proposals

for coding changes at public meetings

held on June 6 and December 5 and 6,

1996, and finalized the coding changes

after consideration of comments

received at the meetings and in writing

within 60 days following the December

1996 meeting. The initial meeting for

consideration of coding issues for

implementation in FY 1999 was held on

June 6, 1997. The minutes of the

meeting can be obtained from the HCFA

Home Page @ http://

www.hcfa.gov.pubaffr.htm. Paper

copies of these minutes will no longer

be available and the mailing list will be

discontinued. We encourage

commenters to address suggestions on

coding issues involving diagnosis codes

to: Donna Pickett, Co-Chairperson; ICD–

9–CM Coordination and Maintenance

Committee; NCHS; Room 1100; 6525

Belcrest Road; Hyattsville, Maryland

20782. Comments may be sent by E-mail

to: dfp4@nch11a.em.cdc.gov.

Questions and comments concerning

the procedure codes should be

addressed to: Patricia E. Brooks, CoChairperson; ICD–9–CM Coordination

and Maintenance Committee; HCFA,

Office of Hospital Policy; Division of

Prospective Payment System; C5–06–27;

7500 Security Boulevard; Baltimore,

Maryland 21244–1850. Comments may

be sent by E-mail to: pbrooks@hcfa.gov.

The ICD–9–CM code changes that

have been approved will become

effective October 1, 1997. The new ICD–

9–CM codes are listed, along with their

DRG classifications, in Tables 6A and

6B (New Diagnosis Codes and New

Procedure Codes, respectively) in

section V of the Addendum to this final

rule. As we stated above, the code
45982 Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations

numbers and their titles were presented

for public comment in the ICD–9–CM

Coordination and Maintenance

Committee meetings. Both oral and

written comments were considered

before the codes were approved.

Further, the Committee has approved

the expansion of certain ICD–9–CM

codes to require an additional digit for

valid code assignment. Diagnosis codes

that have been replaced by expanded

codes, other codes, or have been deleted

are in Table 6C (Invalid Diagnosis

Codes). These invalid diagnosis codes

will not be recognized by the GROUPER

beginning with discharges occurring on

or after October 1, 1997. The

corresponding new or expanded

diagnosis codes are included in Table

6A. Revisions to diagnosis code titles

are in Table 6D (Revised Diagnosis Code

Titles), which also includes the DRG

assignments for these revised codes. For

FY 1998, there are no procedure codes

that have been replaced or deleted nor

are there any revisions to procedure

code titles. We received three comments

concerning our assignment of new ICD–

9–CM codes.

Comment: One commenter wrote in

support of the creation of a new

diagnosis code for pyoderma

gangrenosum (code 686.01) in order to

distinguish this condition from

infectious pyoderma. The commenter

stated that pyoderma gangrenosum is

not infectious, but instead is a

manifestation of other disease such as

ulcerative colitis or Crohn’s disease.

Pyoderma gangrenosum is characterized

by ulcers with extensive necrosis

around the edges and are generally

found on the lower extremities.

Therefore, the commenter believes that

this code should be assigned to DRG 271

(Skin Ulcers) rather than DRGs 277, 278,

and 279 (Cellulitis).

Response: When a new code is

introduced, our longstanding practice is

to assign it to the same DRG category as

its predecessor code or codes. Therefore,

we proposed to assign diagnosis code

686.01 to DRGs 277, 278, and 279, the

DRGs to which its predecessor code,

686.0 (pyoderma), had been assigned.

The resource use and other data

associated with this diagnosis code will

be available in the FY 1998 MedPAR

file, which will be used for analysis as

part of the FY 2000 DRG changes. We

will evaluate the DRG assignment of

code 686.01 at that time.

Comment: In the proposed rule, we

announced a new diagnosis code (031.2)

for disease due to disseminated

mycobacterium avium-intracellulare

complex (DMAC). We proposed that this

code be classified to DRG 423 (Other

Infectious and Parasitic Disease

Diagnoses) in MDC 18 (Infectious and

Parasitic Diseases, Systemic or

Unspecified Sites) as well as be

designated as an HIV major related

condition in DRG 489 (HIV with Major

Related Condition). A commenter

disagreed with our decision to classify

this code as a non-CC; that is, diagnosis

code 031.2 would not be included on

the CC list. The commenter believes that

when DMAC is present as a secondary

diagnosis, it would be considered a

substantial complication or

comorbidity.

Response: DMAC is the most common

disseminated bacterial infection in

patients with advanced acquired

immunodeficiency syndrome (AIDS). As

such, cases coded with 031.2 will also

be coded with a principal or secondary

diagnosis of 042, Human

immunodeficiency virus (HIV) disease

and will be assigned to DRG 489. DRG

489 is not divided based on the

presence or absence of CCs. We believe

that the vast majority of patients with

DMAC, if not all, will be assigned to this

DRG, thus negating the need to add this

disease to the CC list. As noted above,

it is our practice to assign new codes to

the same category as their predecessor

code was assigned. We note that cases

coded 031.2 would have been coded to

031.8 (other specified mycobacterial

diseases), which is not a CC. We will

review the assignment of cases in which

DMAC is coded as a secondary

condition when the FY 1998 MedPAR

file becomes available and re-evaluate

our decision.

Comment: Commenters noted what

they believed to be a typographical error

concerning new code V42.83 (organ or

tissue replaced by transplant, pancreas).

In Table 6A, New Diagnosis Codes, this

code was recorded as being assigned to

MDC 7, DRG 467 (Other Factors

Influencing Health Status). Since DRG

467 is assigned to MDC 23, the

commenters assumed this was a

typographical error.

Response: The commenters are

correct; diagnosis code V42.83 is

assigned to DRG 204 (Disorders of

Pancreas Except Malignancy) in MDC 7.

10. Other Issues

a. MDC 22 (Burns)

Under the current DRG system, burn

cases generally are assigned to one of six

DRGs in MDC 22 (Burns). These DRGs—

DRGs 456 through 460 and 472—have

been in place without change since

1986. Recently, we have received

several letters from representatives of

facilities that specialize in treating burn

cases asserting that the existing DRGs do

not adequately capture the variation in

resource use associated with different

types of burn cases. In the proposed rule

(62 FR 29912), we discussed the

concerns of these correspondents and

solicited public comments on whether

changes in these DRGs can increase

their ability to explain the variation in

resource use among burn cases.

We received approximately 15 public

comments on this issue, all of which

supported our efforts to identify DRG

groupings that would reflect more

homogeneous resource use. These

comments included a proposal for

restructuring the DRG classifications in

MDC 22 that has been endorsed by the

American Burn Association. Several

commenters also suggested the need for

a special facility category to make

possible payment differences for

designated burn care facilities. As noted

in the proposed rule, however, any

suggestions involving payment

adjustments for hospitals designated as

burn centers would require legislative

action. We intend to conduct a full

review of the comments and proposals

we have received as part of the FY 1999

DRG analysis agenda. We will discuss

our findings and, if appropriate, propose

modifications to MDC 22 in the FY 1999

proposed rule.

b. Marfan Syndrome (DRG 390)

We are making a minor DRG

classification change for FY 1998 that

we inadvertently did not include in the

June 2 proposed rule. Based on

correspondence we have received, we

reviewed the assignment of diagnosis

code 759.82 (Marfan syndrome) to DRG

390 (Neonate with Other Significant

Problems) in MDC 15 (Newborns and

Other Neonates with Conditions

Originating in the Perinatal Period).

While Marfan syndrome is a congenital

disorder, cardiovascular abnormalities

associated with the disorder are most

likely to manifest in adults. Because the

current classification system often

results in adult patients being classified

to the MDC for newborns, we agree that,

from a clinical coherence standpoint, it

is appropriate that these cases be

reclassified. Therefore, we are

reassigning code 759.82 from DRG 390

into MDC 5, DRGs 135, 136, and 137

(Cardiac Congenital & Valvular

Disorders). There were no cases with a

principal diagnosis code of 759.82 in

the FY 1996 MedPAR file.

C. Recalibration of DRG Weights

We proposed to use the same basic

methodology for the FY 1998

recalibration as we did for FY 1997. (See

the August 30, 1996 final rule (61 FR

46176).) That is, we would recalibrate

the weights based on charge data for
Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations 45983

Medicare discharges. However, we

would use the most current charge

information available, the FY 1996

MedPAR file, rather than the FY 1995

MedPAR file. The MedPAR file is based

on fully-coded diagnostic and surgical

procedure data for all Medicare

inpatient hospital bills.

The final recalibrated DRG relative

weights are constructed from FY 1996

MedPAR data, based on bills received

by HCFA through June 1997, from all

hospitals subject to the prospective

payment system and short-term acute

care hospitals in waiver States. The FY

1996 MedPAR file includes data for

approximately 11.2 million Medicare

discharges.

The methodology used to calculate

the DRG relative weights from the FY

1996 MedPAR file is as follows:

• All the claims were regrouped using

the DRG classification revisions

discussed above in section II.B of this

preamble.

• Charges were standardized to

remove the effects of differences in area

wage levels, indirect medical education

costs, disproportionate share payments,

and, for hospitals in Alaska and Hawaii,

the applicable cost-of-living adjustment.

• The average standardized charge

per DRG was calculated by summing the

standardized charges for all cases in the

DRG and dividing that amount by the

number of cases classified in the DRG.

• We then eliminated statistical

outliers, using the same criteria as was

used in computing the current weights.

That is, all cases that are outside of 3.0

standard deviations from the mean of

the log distribution of both the charges

per case and the charges per day for

each DRG.

• The average charge for each DRG

was then recomputed (excluding the

statistical outliers) and divided by the

national average standardized charge

per case to determine the relative

weight. A transfer case is counted as a

fraction of a case based on the ratio of

its length of stay to the geometric mean

length of stay of the cases assigned to

the DRG. That is, a 5-day length of stay

transfer case assigned to a DRG with a

geometric mean length of stay of 10 days

is counted as 0.5 of a total case.

• We established the relative weight

for heart and heart-lung, liver, and lung

transplants (DRGs 103, 480, and 495) in

a manner consistent with the

methodology for all other DRGs except

that the transplant cases that were used

to establish the weights were limited to

those Medicare-approved heart, heartlung, liver, and lung transplant centers

that have cases in the FY 1995 MedPAR

file. (Medicare coverage for heart, heartlung, liver, and lung transplants is

limited to those facilities that have

received approval from HCFA as

transplant centers.)

• Acquisition costs for kidney, heart,

heart-lung, liver, and lung transplants

continue to be paid on a reasonable cost

basis. Unlike other excluded costs, the

acquisition costs are concentrated in

specific DRGs (DRG 302 (Kidney

Transplant); DRG 103 (Heart Transplant

for heart and heart-lung transplants);

DRG 480 (Liver Transplant); and DRG

495 (Lung Transplant)). Because these

costs are paid separately from the

prospective payment rate, it is necessary

to make an adjustment to prevent the

relative weights for these DRGs from

including the effect of the acquisition

costs. Therefore, we subtracted the

acquisition charges from the total

charges on each transplant bill that

showed acquisition charges before

computing the average charge for the

DRG and before eliminating statistical

outliers.

When we recalibrated the DRG

weights for previous years, we set a

threshold of 10 cases as the minimum

number of cases required to compute a

reasonable weight. We proposed to use

that same case threshold in recalibrating

the DRG weights for FY 1998. For this

final rule, using the FY 1996 MedPAR

data set, there are 34 DRGs that contain

fewer than 10 cases. We computed the

weights for the 34 low-volume DRGs by

adjusting the FY 1997 weights of these

DRGs by the percentage change in the

average weight of the cases in the other

DRGs.

The weights developed according to

the methodology described above, using

the proposed DRG classification

changes, result in an average case

weight that is different from the average

case weight before recalibration.

Therefore, the new weights are

normalized by an adjustment factor, so

that the average case weight after

recalibration is equal to the average case

weight before recalibration. This

adjustment is intended to ensure that

recalibration by itself neither increases

nor decreases total payments under the

prospective payment system.

Section 1886(d)(4)(C)(iii) of the Act

requires that beginning with FY 1991,

reclassification and recalibration

changes be made in a manner that

assures that the aggregate payments are

neither greater than nor less than the

aggregate payments that would have

been made without the changes.

Although normalization is intended to

achieve this effect, equating the average

case weight after recalibration to the

average case weight before recalibration

does not necessarily achieve budget

neutrality with respect to aggregate

payments to hospitals because payment

to hospitals is affected by factors other

than average case weight. Therefore, as

we have done in past years and as

discussed in section II.A.4.a of the

Addendum to this final rule, we are

making a budget neutrality adjustment

to assure that the requirement of section

1886(d)(4)(C)(iii) of the Act is met.

Although we received no comments

on the recalibration of the DRG weights,

we did receive one comment that relates

to that process.

Comment: One commenter was

concerned about the reduction in the

proposed FY 1998 relative weight for

DRG 480 (Liver Transplant), compared

to the FY 1997 weight. The commenter

noted that Table 5 of the proposed rule

(62 FR 29990) indicated approximately

an 8-day reduction in length of stay

from FY 1995 to FY 1996 and asked that

we review the MedPAR data for this

DRG to verify the accuracy of the data

and the consequent change in the

relative weight.

Response: Every year when the

relative weights are recalibrated, we use

charge information from the most recent

Medicare data available. That is, we use

the charges reported by hospitals for the

cases under each DRG to establish the

relative weights. As the commenter

requested, we have re-examined the FY

1996 MedPAR data that are used in

establishing the DRG relative weights

for FY 1998. We have not identified any

problems or anomalies related to the

cases in DRG 480 and are confident that

the relative weight and length of stay

data set forth in Table 5 of this final rule

are accurate. We note that the final FY

1996 MedPAR data result in a slightly

higher relative weight and average

length of stay for DRG 480 than shown

in the proposed rule, although the data

still indicate close to a 7-day reduction

in average length of stay for these cases.

(Data for the final rule are taken from

the June 1997 update of the FY 1996

MedPAR data, rather than the December

1996 file used for the proposed rule.)

Both the relative weight and the

length of stay for liver transplant cases

have exhibited continuing declines

since the early 1990’s. Although the

decline between FY 1995 and FY 1996

was more pronounced than in some

other years, this change is not unusual

for a relatively low volume DRG (fewer

than 400 cases) with a large range of

reported charges and lengths of stay. A

few very low or very high charge cases

can make a dramatic difference in the

DRG weight.
45984 Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations

III. Changes to the Hospital Wage Index

and Medicare Geographic

Reclassification Guidelines

A. Background

Section 1886(d)(3)(E) of the Act

requires that, as part of the methodology

for determining prospective payments to

hospitals, the Secretary must adjust the

standardized amounts ‘‘for area

differences in hospital wage levels by a

factor (established by the Secretary)

reflecting the relative hospital wage

level in the geographic area of the

hospital compared to the national

average hospital wage level.’’ In

accordance with the broad discretion

conferred under the Act, we currently

define hospital labor market areas based

on the definitions of Metropolitan

Statistical Areas (MSAs), Primary MSAs

(PMSAs), and New England County

Metropolitan Areas (NECMAs) issued by

the Office of Management and Budget

(OMB). OMB also designates

Consolidated MSAs (CMSAs). A CMSA

is a metropolitan area with a population

of one million or more, comprised of

two or more PMSAs (identified by their

separate economic and social character).

For purposes of the hospital wage index,

we use the PMSAs rather than CMSAs

since they allow a more precise

breakdown of labor costs. If a

metropolitan area is not designated as

part of a PMSA, we use the applicable

MSA. Rural areas are areas outside a

designated MSA, PMSA, or NECMA.

In the proposed rule, we noted that,

effective April 1, 1990, the term

Metropolitan Area (MA) replaced the

term Metropolitan Statistical Area

(MSA) (which had been used since June

30, 1983) to describe the set of

metropolitan areas comprised of MSAs,

PMSAs, and CMSAs. The terminology

was changed by OMB in the March 30,

1990 Federal Register to distinguish

between the individual metropolitan

areas known as MSAs and the set of all

metropolitan areas (MSAs, PMSAs, and

CMSAs) (55 FR 12154). For purposes of

the prospective payment system, we

will continue to refer to these areas as

MSAs.

Section 1886(d)(3)(E) of the Act also

requires that the wage index be updated

annually beginning October 1, 1993.

Furthermore, this section provides that

the Secretary base the update on a

survey of wages and wage-related costs

of short-term, acute care hospitals. The

survey should measure, to the extent

feasible, the earnings and paid hours of

employment by occupational category,

and must exclude the wages and wagerelated costs incurred in furnishing

skilled nursing services. We also adjust

the wage index, as discussed below in

section III.B.3, to take into account the

geographic reclassification of hospitals

in accordance with sections

1886(d)(8)(B) and 1886(d)(10) of the Act.

B. FY 1998 Wage Index Update

The final FY 1998 wage index in

section V. of the Addendum (effective

for hospital discharges occurring on or

after October 1, 1997 and before October

1, 1998) is based on the data collected

from the Medicare cost reports

submitted by hospitals for cost reporting

periods beginning in FY 1994 (the FY

1997 wage index was based on FY 1993

wage data). We used the same categories

of data that were used in the FY 1997

wage index. Therefore, the FY 1998

wage index reflects the following:

• Total salaries and hours from shortterm, acute care hospitals.

• Home office costs and hours.

• Fringe benefits associated with

hospital and home office salaries.

• Direct patient care contract labor

costs and hours.

• The exclusion of salaries and hours

for nonhospital type services such as

skilled nursing facility services, home

health services, or other subprovider

components that are not subject to the

prospective payment system.

We proposed to calculate a separate

Puerto Rico-specific wage index to be

applied to the Puerto Rico standardized

amount. We stated that this wage index

would be calculated in the same manner

as the national wage index described

below, but will be based solely on

Puerto Rico’s data. We received several

comments supporting the new Puerto

Rico-specific wage index. We are

implementing that change and revising

§ 412.210(e) accordingly.

We did not propose any changes in

the reporting of hospital wage index

data, but we received numerous

comments regarding the FY 1995 wage

data, which will not be used until we

develop the FY 1999 wage index. The

Medicare cost report for reporting

periods beginning during FY 1995

included several changes to the

Worksheet S–3 that will allow us to

analyze further refinements to the wage

index. Among those changes are the

separate reporting of all salary costs for

physicians (including teaching

physicians), residents, and certified

registered nurse anesthetists (CRNAs).

In addition, we collected overhead cost

data by cost center in order to analyze

the possibility of excluding overhead

costs attributable to skilled nursing

facilities and other excluded areas from

the wage index. These comments are

discussed in detail below.

Comment: Two commenters stated

that we should exclude physician

salaries (as recommended by the

Medicare Technical Advisory Group);

one suggested that we should

immediately exclude these costs using

information from the Worksheet A–8–2

of the Medicare cost report.

Alternatively, a few commenters

suggested that we should include

contracted Part A physician salaries for

those States in which hospitals are

prohibited from employing physicians.

Several commenters are concerned that

the removal of teaching physician and

resident salaries would redistribute

revenues from large metropolitan areas

with large teaching programs to areas

that support medical education to a

lesser extent. The commenters noted

that recent legislation revising the

payments for disproportionate share and

the indirect medical education

adjustments (sections 4403 and 4621 of

Public Law 105–33) will further reduce

payment for hospitals in major

metropolitan areas.

Other commenters suggested that we

analyze the impact of excluding the data

before making a final decision. Some

commenters specifically recommended

that we determine whether hospitals

that are prohibited from employing

physicians are disadvantaged by our

current policy, and, if so, that we

develop a policy that minimizes the

redistribution of revenue and the

concentration of losses in particular

geographic areas.

Response: These comments relate to

the FY 1995 wage data, which we are

not using in developing the FY 1998

wage index. We will consider these

comments in developing the FY 1999

wage index. Although the deadline for

fiscal intermediaries to submit all of the

reviewed FY 1995 wage data to HCFA

is mid-November 1997, we intend to

begin our analysis of these data prior to

that time, based on the data that have

already been submitted to the Health

Care Provider Cost Report Information

System (HCRIS). We note that our

fundamental objective in administering

the wage index is to ensure that it is

accurate and fair, and we will evaluate

the use of the FY 1995 wage data with

that objective in mind.

Regarding the suggestion that we use

Worksheet A–8–2 to exclude Part A

physician salaries, we noted in the

proposed rule (62 FR 29914) that,

because the intermediaries had already

begun reviewing the FY 1994 cost report

and finalizing the Worksheet S–3 data,

we did not believe it would be

appropriate to revise their instructions

and require them to make a change to

their procedure. Therefore, we will

review and evaluate for the FY 1995

data, which provides for the separate
Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations 45985

reporting of physician salaries when

considering appropriate changes in the

FY 1999 wage index.

Comment: One hospital association

commented that it had analyzed

unedited preliminary FY 1995 HCRIS

data and concluded that revising our

policy to include contracted Part A

physician salaries would redistribute

current payments by only half of what

would result if we changed our policy

to exclude all Part A physician and

resident salaries. (Currently, we exclude

contracted Part A physician salaries, but

include similar salaries if the physician

is employed by the hospital.) Other

commenters noted other data issues that

arise using the preliminary FY 1995

HCRIS wage data.

Response: In response to these

comments, we would emphasize that

the cost report data analyzed by these

commenters are very preliminary, and

in many cases, have not yet been

reviewed by the intermediaries. The

data were extracted from the HCRIS

Minimum Data Set, which is updated

quarterly and becomes more accurate

and complete after the deadline for

completion of the wage data desk

reviews by the intermediaries. We are

aware of the need to carefully review

these data due to the changes discussed

above, and we will work with those in

the hospital industry that have taken the

initiative to begin to examine the data

in order to draw upon their findings

while proceeding with our analysis.

Comment: Two commenters stated

that wages and wage-related costs for

physicians, residents, and CRNAs are

not reported separately for FY 1995, but

are reported separately for FY 1996.

They requested that HCFA postpone its

evaluation of the exclusion of these data

until the FY 1996 data are available, and

that HCFA announce this 1-year delay

in the FY 1998 final rule.

Response: We are aware that for the

FY 1995 cost reports some hospitals

may have reported teaching physicians’

salaries with residents’ wages, and also

did not separately report wage-related

costs for physicians, residents, and

CRNAs. To address this situation we

revised the FY 1996 cost reporting

instructions. We will consider the

impact of this problem in our FY 1995

data analysis.

Comment: Four commenters disputed

the rationale that Part A physician and

resident salaries should be excluded

from the wage index because these costs

are largely paid through Medicare direct

graduate medical education payments.

They stated that other costs, such as

outpatient and general service costs that

are allocated to excluded cost centers,

are similarly paid outside the

prospective payment system, but are

included in the wage index calculation.

Response: The FY 1995 revised

Worksheet S–3 allows for the separate

reporting of direct salaries and hours by

general service cost centers as well as

physician salaries. We plan to analyze

these data to determine the feasibility of

allocating general service costs and

removing those costs that are associated

with excluded areas. Regarding

outpatient costs, hospital staff

frequently provide services in both the

outpatient and inpatient departments,

and we believe that the inclusion of

outpatient salaries causes little or no

distortion to the wage index.

1. Verification of Wage Data From the

Medicare Cost Report

The data for the FY 1998 wage index

were obtained from Worksheet S–3, Part

II of the Medicare cost report. The data

file used to construct the final wage

index includes FY 1994 data submitted

to HCRIS. As in past years, we

performed an intensive review of the

wage data, mostly through the use of

edits designed to identify aberrant data.

In the proposed rule, we discussed in

detail our review of the wage data as

well as the process that hospitals could

use to verify their wage data and submit

requests for corrections if necessary (62

FR 29914). To be reflected in the final

wage index, wage data corrections had

to be reviewed, verified, and transmitted

to HCFA through HCRIS by June 16,

1997. (Any changes after this date are

limited to errors related to handling the

data, as described below in section III.C

of this preamble.) All data elements that

failed edits have been resolved and are

reflected in the final wage index.

2. Computation of the Wage Index

The method used to compute the final

wage index is as follows:

Step 1—As noted above, we based the

FY 1998 wage index on wage data

reported on the FY 1994 Medicare cost

reports. We gathered data from each of

the non-Federal, short-term, acute care

hospitals for which data were reported

on the Worksheet S–3, Part II of the

Medicare cost report for the hospital’s

cost reporting period beginning on or

after October 1, 1993 and before October

1, 1994. In addition, we included data

from a few hospitals that had cost

reporting periods beginning in

September 1993 and reported a cost

reporting period exceeding 52 weeks.

These data were included because no

other data from these hospitals would

be available for the cost reporting period

described above, and particular labor

market areas might be affected due to

the omission of these hospitals.

However, we generally describe these

wage data as FY 1994 data.

Step 2—For each hospital, we

subtracted the excluded salaries (that is,

direct salaries attributable to skilled

nursing facility services, home health

services, and other subprovider

components not subject to the

prospective payment system) from gross

hospital salaries to determine net

hospital salaries. To determine total

salaries plus fringe benefits, we added

direct patient care contract labor costs,

hospital fringe benefits, and any home

office salaries and fringe benefits

reported by the hospital, to the net

hospital salaries.

Step 3—For each hospital, we

adjusted the total salaries plus fringe

benefits resulting from Step 2 to a

common period to determine total

adjusted salaries. To make the wage

inflation adjustment, we used the

percentage change in average hourly

earnings estimated for each 30-day

increment from October 14, 1993

through April 15, 1995, for hospital

industry workers from Standard

Industry Classification 806, Bureau of

Labor Statistics Employment and

Earnings Bulletin. The annual inflation

rates used were 3.6 percent for FY 1993,

2.7 percent for FY 1994, and 3.3 percent

for FY 1995. The inflation factors used

to inflate the hospital’s data were based

on the midpoint of the cost reporting

period as indicated below.

MIDPOINT OF COST REPORTING

PERIOD

After Before Adjustment

factor

10/14/93 ........ 11/15/93 ........ 1.038679

11/14/93 ........ 12/15/93 ........ 1.036376

12/14/93 ........ 01/15/94 ........ 1.034077

01/14/94 ........ 02/15/94 ........ 1.031784

02/14/94 ........ 03/15/94 ........ 1.029496

03/14/94 ........ 04/15/94 ........ 1.027213

04/14/94 ........ 05/15/94 ........ 1.024935

05/14/94 ........ 06/15/94 ........ 1.022662

06/14/94 ........ 07/15/94 ........ 1.020394

07/14/94 ........ 08/15/94 ........ 1.018131

08/14/94 ........ 09/15/94 ........ 1.015873

09/14/94 ........ 10/15/94 ........ 1.013620

10/14/94 ........ 11/15/94 ........ 1.010881

11/14/94 ........ 12/15/94 ........ 1.008150

12/14/94 ........ 01/15/95 ........ 1.005426

01/14/95 ........ 02/15/95 ........ 1.002709

02/14/95 ........ 03/15/95 ........ 1.000000

03/14/95 ........ 04/15/95 ........ 0.997298

For example, the midpoint of a cost

reporting period beginning January 1,

1994 and ending December 31, 1994 is

June 30, 1994. An inflation adjustment

factor of 1.020394 would be applied to

the wages of a hospital with such a cost

reporting period. In addition, for the

data for any cost reporting period that
45986 Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations

began in FY 1994 and covers a period

of less than 360 days or greater than 370

days, we annualized the data to reflect

a 1-year cost report. Annualization is

accomplished by dividing the data by

the number of days in the cost report

and then multiplying the results by 365.

Step 4—For each hospital, we

subtracted the reported excluded hours

from the gross hospital hours to

determine net hospital hours. We

increased the net hours by the addition

of any direct patient care contract labor

hours and home office hours to

determine total hours.

Step 5—As part of our editing

process, we deleted data for 18 hospitals

for which we lacked sufficient

documentation to verify data that failed

edits because the hospitals are no longer

participating in the Medicare program

or are in bankruptcy status. We retained

the data for other hospitals that are no

longer participating in the Medicare

program because these hospitals

reflected the relative wage levels in their

labor market areas during their FY 1994

cost reporting period.

Step 6—Each hospital was assigned to

its appropriate urban or rural labor

market area prior to any reclassifications

under sections 1886(d)(8)(B) or

1886(d)(10) of the Act. Within each

urban or rural labor market area, we

added the total adjusted salaries plus

fringe benefits obtained in Step 3 for all

hospitals in that area to determine the

total adjusted salaries plus fringe

benefits for the labor market area.

Step 7—We divided the total adjusted

salaries plus fringe benefits obtained in

Step 6 by the sum of the total hours

(from Step 4) for all hospitals in each

labor market area to determine an

average hourly wage for the area.

Step 8—We added the total adjusted

salaries plus fringe benefits obtained in

Step 3 for all hospitals in the nation and

then divided the sum by the national

sum of total hours from Step 4 to arrive

at a national average hourly wage. Using

the data as described above, the national

average hourly wage is $20.0950.

Step 9—For each urban or rural labor

market area, we calculated the hospital

wage index value by dividing the area

average hourly wage obtained in Step 7

by the national average hourly wage

computed in Step 8.

Step 10—Following the process set

forth above, we developed a separate

Puerto Rico-specific wage index for

purposes of adjusting the Puerto Rico

standardized amounts. We added the

total adjusted salaries plus fringe

benefits (as calculated in Step 3) for all

hospitals in Puerto Rico and divided the

sum by the total hours for Puerto Rico

(as calculated in Step 4) to arrive at an

overall average hourly wage of $9.1364

for Puerto Rico. For each labor market

area in Puerto Rico, we calculated the

hospital wage index value by dividing

the area average hourly wage (as

calculated in Step 7) by the overall

Puerto Rico average hourly wage.

Step 11—Section 4410(a) Public Law

105–33 provides that, for discharges on

or after October 1, 1997, the area wage

index applicable to any hospital that is

not located in a rural area may not be

less than the area wage index applicable

to hospitals located in rural areas in the

State in which the hospital is located.

For FY 1998, this change affects 128

hospitals in 32 MSAs. The MSAs

affected by this provision are identified

in Table 4A by a footnote. Furthermore,

this wage index floor is to be

implemented in such a manner as to

assure that aggregate prospective

payment system payments are not

greater or less than those which would

have been made in the year if this

section did not apply. We note that the

Secretary has exercised the authority

granted to her by section 4408 of Public

Law 105- 33 to include Stanly County

in the Charlotte-Gastonia-Rock Hill,

North Carolina-South Carolina MSA.

This change is reflected in the final

wage index.

3. Revisions to the Wage Index Based on

Hospital Redesignation

Under section 1886(d)(8)(B) of the

Act, hospitals in certain rural counties

adjacent to one or more MSAs are

considered to be located in one of the

adjacent MSAs if certain standards are

met. Under section 1886(d)(10) of the

Act, the Medicare Geographic

Classification Review Board (MGCRB)

considers applications by hospitals for

geographic reclassification for purposes

of payment under the prospective

payment system.

The methodology for determining the

wage index values for redesignated

hospitals is applied jointly to the

hospitals located in those rural counties

that were deemed urban under section

1886(d)(8)(B) of the Act and those

hospitals that were reclassified as a

result of the MGCRB decisions under

section 1886(d)(10) of the Act. Section

1886(d)(8)(C) of the Act provides that

the application of the wage index to

redesignated hospitals is dependent on

the hypothetical impact that the wage

data from these hospitals would have on

the wage index value for the area to

which they have been redesignated.

Therefore, as provided in section

1886(d)(8)(C) of the Act, the wage index

values were determined by considering

the following:

• If including the wage data for the

redesignated hospitals would reduce the

wage index value for the area to which

the hospitals are redesignated by 1

percentage point or less, the area wage

index value determined exclusive of the

wage data for the redesignated hospitals

applies to the redesignated hospitals.

• If including the wage data for the

redesignated hospitals reduces the wage

index value for the area to which the

hospitals are redesignated by more than

1 percentage point, the hospitals that are

redesignated are subject to that

combined wage index value.

• If including the wage data for the

redesignated hospitals increases the

wage index value for the area to which

the hospitals are redesignated, both the

area and the redesignated hospitals

receive the combined wage index value.

• The wage index value for a

redesignated urban or rural hospital

cannot be reduced below the wage

index value for the rural areas of the

State in which the hospital is located.

• Rural areas whose wage index

values would be reduced by excluding

the wage data for hospitals that have

been redesignated to another area

continue to have their wage index

values calculated as if no redesignation

had occurred.

• Rural areas whose wage index

values increase as a result of excluding

the wage data for the hospitals that have

been redesignated to another area have

their wage index values calculated

exclusive of the wage data of the

redesignated hospitals.

• The wage index value for an urban

area is calculated exclusive of the wage

data for hospitals that have been

reclassified to another area. However,

geographic reclassification may not

reduce the wage index value for an

urban area below the statewide rural

wage index value.

We note that, except for those rural

areas where redesignation would reduce

the rural wage index value, the wage

index value for each area is computed

exclusive of the wage data for hospitals

that have been redesignated from the

area for purposes of their wage index.

As a result, several urban areas listed in

Table 4a have no hospitals remaining in

the area. This is because all the

hospitals originally in these urban areas

have been reclassified to another area by

the MGCRB. These areas with no

remaining hospitals receive the

prereclassified wage index value. The

prereclassified wage index value will

apply as long as the area remains empty.

The final wage index values for FY

1998 are shown in Tables 4A, 4B, 4C,

and 4F in the Addendum to this final

rule. Subject to the provisions of Public
Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations 45987

Law 105–33, the FY 1998 wage index

values incorporate all hospital

redesignations for FY 1998, withdrawals

of requests for reclassification, wage

index corrections, appeals, and the

Administrator’s review process. For FY

1998, 357 hospitals are redesignated for

purposes of the wage index (hospitals

redesignated under section

1886(d)(8)(B) or 1886(d)(10) of the Act).

Hospitals that are redesignated should

use the wage index values shown in

Table 4C. Areas in Table 4C may have

more than one wage index value

because the wage index value for a

redesignated rural hospital cannot be

reduced below the wage index value for

the rural areas of the State in which the

hospital is located. When the wage

index value of the area to which a rural

hospital is redesignated is lower than

the wage index value for the rural areas

of the State in which the rural hospital

is located, the redesignated rural

hospital receives the higher wage index

value, that is, the wage index value for

the rural areas of the State in which it

is located, rather than the wage index

value otherwise applicable to the

redesignated hospitals.

Tables 4D and 4E list the average

hourly wage for each labor market area,

prior to the redesignation of hospitals,

based on the FY 1994 wage data. In

addition, Table 3C in the Addendum to

this final rule includes the adjusted

(inflated) average hourly wage for each

hospital based on the FY 1994 data. The

MGCRB will use the average hourly

wage published in the final rule to

evaluate a hospital’s application for

reclassification, unless that average

hourly wage is later revised in

accordance with the wage data

correction policy described in

§ 412.63(s)(2). In such cases, the MGCRB

will use the most recent revised data

used for purposes of the hospital wage

index.

C. Changes to the Medicare Geographic

Classification Review Board (MGCRB)

Guidelines and Timeframes

Various provisions of Public Law

105–33 address the guidelines the

MGCRB uses to reclassify hospitals to

other geographic areas as well as the

timetable under which hospitals must

submit applications for reclassification

and the MGCRB and the Secretary must

make decisions on those applications.

1. Revised Application and MGCRB

Timeframes

Currently, a hospital must submit an

application to the MGCRB for

geographic reclassification for a fiscal

year by the first day of the preceding

fiscal year (that is, October 1, 1997 for

reclassification effective in FY 1999).

The MGCRB has 180 days to make a

decision on that application (no later

than March 31 of the fiscal year), the

hospital has 15 days to request a review

of that decision by the Administrator of

HCFA (by April 15), and the

Administrator has up to 90 days to issue

a final decision (July 15). Under our

current publication schedule, the July

15 deadline allows the final geographic

reclassification decisions to be

incorporated in the wage index and

payment rates that are published in the

final rule on or about September 1.

Sections 4644 (a)(1) and (b)(1) of

Public Law 105–33 amend section 1886

(d)(6) and (e) of the Act to provide that

the final rule setting the payment rates

for years beginning with FY 1999 must

be published by August 1. Because this

change in publication dates would

conflict with the timetable for

geographic reclassification decisions,

section 4644(c) of Public Law 105–33

amended section 1886(d)(10)(C)(ii) of

the Act to require a hospital to submit

an application for reclassification no

later than the first day of the month

preceding the beginning of the Federal

fiscal year (that is, by September 1)

beginning with applications filed for

reclassification for FY 2000. Under this

timetable, the amount of time the

MGCRB and the Administrator have to

make decisions will not change from the

current schedule.

In addition, because applications filed

for reclassification effective in FY 1999

are not due until October 1, 1997,

section 4644(c)(2) requires us to shorten

the deadlines under section

1886(d)(10)(C) of the Act so that all final

decisions on MGCRB applications will

be completed by June 15, 1998. We have

consulted with the staff of the MGCRB

and the reclassification decisions will

be made by the MGCRB by February 28,

1998. This will allow final decisions of

the Secretary to be completed by June

15, 1998.

We are revising §§ 412.256 and

412.274 to implement the change in the

application deadline.

2. Alternative Wage Index

Reclassification Guidelines for

Individual Hospitals

a. In the September 1, 1992 final rule,

we revised the wage index guidelines at

§ 412.230(e) to add the requirement that

a hospital cannot be reclassified unless

its average hourly wage is at least 108

percent of the average hourly wage of

the area in which it is located. For FY

1998 reclassification, section 4409 of

Public Law 105–33 requires the

Secretary to establish alternative wage

index guidelines for geographic

reclassification. As provided in the

statute, a hospital may reclassify for

wage index purposes if it demonstrates

that:

• Its average hourly wage is at least

108 percent of the average hourly wage

of all other hospitals in its MSA, that is,

not including its own wage data.

• It pays at least 40 percent of the

adjusted uninflated wages in the MSA.

• It reclassified for the wage index for

each of the fiscal years 1992 through

1997.

The hospital must also meet all other

applicable guidelines (for example,

proximity).

As noted above, this provision is

effective for FY 1998 reclassifications.

Because the application and decision

making process for FY 1998

reclassification is already completed, we

must provide special guidelines for

hospitals to apply for reclassification

under this provision for FY 1998.

A hospital seeking reclassification for

FY 1998 under this provision must

submit its application to the MGCRB by

September 15, 1997. In addition, the

hospital must submit 7 copies of a

completed application to the MGCRB.

The MGCRB will dismiss a hospital’s

request for reclassification if the

completed application is not received

by September 15, 1997. If the MGCRB

renders a favorable decision on a

hospital’s application, the hospital will

be reclassified for purposes of the wage

index for FY 1998 as if that decision had

been made under the usual guidelines

and timetable.

Ordinarily, a hospital seeking MGCRB

reclassification for a fiscal year must

submit its application by October 1 of

the preceding fiscal year, and all

reclassification decisions with respect to

a fiscal year must be finalized before the

beginning of the fiscal year (this

includes decisions of the MGCRB as

well as decisions of the HCFA

Administrator when the Administrator

undertakes review). However, sections

4409 and 4410 of Public Law 105–33,

enacted on August 5, 1997, set forth

special reclassification provisions under

which certain hospitals may be

reclassified for FY 1998 (beginning on

October 1, 1997). The MGCRB will make

decisions on applications for

reclassification based on these

provisions before the beginning of the

fiscal year, but it will not be feasible to

complete the process for appeals or

other review before October 1.

Nevertheless, we believe it is

appropriate to permit appeals of

decisions on requests for reclassification

under sections 4409 and 4410.

Therefore, for such appeals, we are

incorporating the current appeals and
45988 Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations

review process (including the timetables

for a hospital to request review and for

the Administrator to complete review)

even though that process will not be

finalized until after the beginning of the

fiscal year. Our general position has

been, and continues to be, that changes

to the prospective payment rates should

be made prospectively only.

Nevertheless, given the extraordinary

circumstances presented by the recent

enactment of the legislation, if a

decision on a request for reclassification

under section 4409 or section 4410

becomes final under this process after

the beginning of the fiscal year, the

decision will be effective as of the

beginning of the fiscal year. We are

revising the regulations at § 412.230(e)

to implement this provision.

b. In the case of a hospital that is

owned by a municipality and that was

reclassified as an urban hospital for FY

1996, in calculating the hospital’s

average hourly wage for the purposes of

geographic reclassification for FY 1998

only, section 4410(c) of Public Law 105–

33 requires the exclusion of general

service wages and hours of personnel

associated with a skilled nursing facility

that is owned by the hospital of the

same municipality and that is

physically separated from the hospital

to the extent that such wages and hours

of such personnel are not shared with

the hospital and are separately

documented. A hospital seeking

reclassification under this provision

must submit 7 copies of a completed

application to the MGCRB by September

15, 1997. The MGCRB will dismiss a

hospital’s request for reclassification if

the completed application is not

received by September 15, 1997. If the

MGCRB renders a favorable decision on

a hospital’s application, the hospital

will be reclassified for purposes of the

wage index for FY 1998 as if that

decision had been made under the usual

guidelines and timetable. The special

appeals procedures discussed earlier

apply to this context as well.

3. Alternative Guidelines for Rural

Referral Centers

Currently, under section

1886(d)(10)(D) of the Act, rural referral

centers (RRCs) are allowed to apply to

the MGCRB to be reclassified for

purposes of the wage index adjustment.

To be reclassified, RRCs must meet the

following criteria:

• The hospital’s average hourly wage

must be at least 108 percent of the

Statewide rural hourly wage.

• The hospital’s average hourly wage

must be at least 84 percent of the

average hourly wage of the target urban

area to which the RRC is applying.

As provided in section 4202 of Public

Law 105–33, the MGCRB is prohibited

from rejecting a hospital’s request for

reclassification on the basis of any

comparison between the average hourly

wage and the average hourly wage of

hospitals in the area in which the

hospital is located if the hospital was

ever classified as an RRC. However,

RRCs will continue to be required to

have an average hourly wage that is at

least 84 percent of the average hourly

wage of the target urban area to which

the RRC is applying. In addition, while

RRCs do not have to meet the proximity

requirements for reclassification, they

continue to be required to seek

reclassification to the nearest urban

area. We are revising § 412.230(a)(3) to

implement this provision.

4. Reclassification for the

Disproportionate Share Adjustment

Section 4203 of Public Law 105–33

provides that for a limited time a rural

hospital may apply and qualify for

reclassification to another area for

purposes of disproportionate share

adjustment payments whether or not the

standardized amount is the same for

both areas. For 30 months after the date

of enactment of Public Law 105–33, the

MGCRB will consider the application

under section 1886(d)(10)(C)(i) of a

hospital requesting a change in the

hospital’s geographic classification for

purposes of determining for a fiscal year

eligibility for and additional payment

amounts under section 1886(d)(5)(F) of

the Act. Under Public Law 105–33, the

MGCRB will apply the guidelines for

standardized amount reclassification

(§ 412.230(d)) until the Secretary

establishes separate guidelines.

Therefore, hospitals seeking such

reclassification for FY 1998 must submit

a reclassification application to the

MGCRB by October 1, 1997. Decisions

based on these applications will be

effective for FY 1999 (beginning on

October 1, 1998). Section 4203 of Public

Law 105–33 is effective for the 30

month period beginning on the date of

enactment. Accordingly, hospitals may

seek reclassification for purposes of

DSH for FY 2000 and FY 2001. We are

revising § 412.230(a)(5)(ii) of the

regulations to implement this provision.

5. Occupational Mix Adjustment

Section 412.230(e) describes the

criteria for hospital reclassification for

purposes of the wage index. One of the

criteria relates to the relationship

between the hospital’s wages and those

of the area to which it seeks

reclassification. Specifically,

§ 412.230(e)(1)(iv) provides that the

hospital must demonstrate that its

wages are at least 84 percent of the

average hourly wage of hospitals in the

area to which it seeks reclassification, or

that the hospital’s average hourly wage

weighted for occupational mix is at least

90 percent of the average hourly wage

of hospitals in the area to which it seeks

reclassification. Under §§ 412.232(c)

and 412.234(b), a group of hospitals

seeking to reclassify must demonstrate

that its aggregate average hourly wage is

at least 85 percent of the average hourly

wage of the hospitals in the area to

which it seeks reclassification. These

sections also provide that the threshold

for the occupational-mix adjusted

hourly wage for hospital groups is the

same as that for a single hospital, that

is, 90 percent.

In the August 30, 1996 final rule, we

stated that, because the American

Hospital Association (AHA) was

terminating its collection of information

on the Hospital Personnel by

Occupation Category as of 1994, there

would be no suitable source of

occupational mix data for hospitals to

use for geographic reclassification under

§§ 412.230(e)(1)(iv), 412.232(c) and

412.234(b) beginning with

reclassifications effective for FY 1999

(61 FR 46185). In that rule, we stated

that we would not make a final decision

on this issue until the next year in case

another suitable source of occupational

mix data were found. Although we did

not include any alternative data source

in the proposed rule, we received some

comments suggesting another way to

obtain occupational mix data.

Comment: One commenter proposed a

methodology for collecting occupational

mix data for those hospitals that seek to

be reclassified through the MGCRB

process using occupational mix data as

part of their wage index calculations.

The commenter proposed the following

process:

• Any hospital that wants to use the

90 percent occupational mix adjustment

criteria should be allowed to use the

1993 AHA data for FY 1999

reclassifications, which must be filed by

October 1, 1997.

• For any hospital that successfully

reclassifies for FY 1999 using the 1993

AHA data, HCFA would contact the

State or local hospital associations in

the State in which the reclassified

hospital is located to obtain more

current occupational mix data for the

affected MSAs that could be used by the

individual hospital for future years’

occupational mix data. In some cases,

there may be costs incurred in collecting

these data. The commenter suggested

that the individual reclassified hospitals

would bear any costs of data collection

incurred by the State or local hospital
Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations 45989

associations or, alternatively, the costs

could be distributed by the associations

to the individual hospitals in the MSA

asked to provide these data.

• The applicable hospital associations

would provide the data to HCFA for any

data review deemed necessary by

HCFA. The individual hospitals would

obtain the occupational mix data

directly from HCFA after HCFA had

completed any data edits or performed

any other procedures that HCFA

believes necessary to determine the

validity and usability of the data. The

data would be collected in a single

survey for FY 1995, FY 1996, and FY

1997 to correspond with the next 3

years of wage survey data. Thus, current

data would be available for the next 3

years for the individual MSA to which

a hospital was successfully reclassified

using the 90 percent occupational mix

data.

• For future years, individual

hospitals seeking to qualify using the

occupational mix criterion for a wage

index reclassification to an MSA where

the data are not already being collected

could use the 1993 AHA data for the

first year. This would then trigger a data

accumulation request for that area. It is

the opinion of the commenter that this

would allow all prospective payment

hospitals to use the 90 percent criterion

if needed.

Three State hospital associations also

wrote to indicate support for this

proposal. The AHA supports the use of

its 1993 occupational mix data on an

interim basis. In addition, although the

AHA does not wish to be the future

vehicle of data collection, it supports

the concept of hospitals designing a

method to collect occupational mix data

for use in future years.

Response: As we stated in the June 4,

1991 final rule with comment period (56

FR 25458), the reclassification process

requires the use of occupational mix

data that are comparable across areas

and that can be consistently applied. We

are unaware of any sources other than

the AHA data that meet these criteria.

(Originally, these data were also

available from the Department of Labor

Statistics, which has since discontinued

its hospital wage survey.) We responded

to comments on this issue in the August

30, 1996 final rule (61 FR 46186). In that

document, we reiterated that we were

interested only in occupational mix data

that are available on a national basis.

We also noted that we were not

interested in collecting the data

ourselves.

The commenter’s proposal fails to

meet the ‘‘national basis’’ criterion that

we set. The commenter proposes that

only hospitals in certain areas would

have to report occupational mix data.

This does not provide a national

database for those other hospitals that

might want to use the data at some

future time, nor does it allow

verification of the data through edit

checks performed on a national basis,

such as those that we perform on the

wage data. The commenter also

proposes that HCFA ensure that the data

are collected and that HCFA edit and

validate the data and provide them to

those who request the data. We do not

want to be either the requestor or the

repository of these data, nor do we have

the resources to edit or validate these

data.

In addition, this proposal

contemplates the use of the 1993 AHA

data for several years. For example, if a

hospital first attempts to qualify using

occupational mix data for FY 2002 in an

area not already collecting these data, it

would have to use the 1993 AHA

occupational mix categories to adjust

1997 wage data. We believe that this

would not be an accurate measure of the

hospital’s weighted average hourly wage

for purposes of reclassification.

Finally, the commenter suggests that

those hospitals that benefit from the use

of occupational mix data should fund

the data collection effort. This could

lead to some inconsistency in

availability of the data. If some hospitals

that could benefit are unable to fund the

collection effort, they would be at a

disadvantage. Moreover, we are

uncomfortable with the concept of

allowing hospitals that will benefit from

certain data to pay others for those data.

We are unsure about how the payment

incentive might influence the data.

Since we have discovered no other

suitable source of occupational mix data

during the past year, we have no

updated occupational mix data to

correspond with the FY 1994 wage data

that will be used for FY 1999

reclassifications. Therefore, this option

will no longer be available to hospitals.

We have amended the regulations at

§§ 412.230(e), 412.232(c), and

412.234(b) to reflect this decision. We

remain interested in any occupational

mix data proposals that meet our

criteria.

D. Requests for Wage Data Corrections

In the proposed rule, we stated that,

as in past years, we would make a data

file available in mid-August containing

the wage data used to construct the

wage index values in the final rule.

(Please note that this data file is also

available through the Internet at HCFA’s

home page (http://www.hcfa.gov).) As

with the file made available in March

1997, HCFA makes the August wage

data file available to hospital

associations and the public. This August

file is being made available only for the

limited purpose of identifying any

potential errors made by HCFA or the

intermediary in the entry of the final

wage data that result from the process

described above, not for the initiation of

new wage data correction requests.

If, after reviewing the August data file

or the information in this final rule, a

hospital believes that its wage data are

incorrect due to a fiscal intermediary or

HCFA error in the entry or tabulation of

the final wage data, it should send a

letter to both its fiscal intermediary and

HCFA. The letters should outline why

the hospital believes an error exists and

provide all supporting information,

including dates. These requests must be

received by HCFA and the

intermediaries no later than September

15, 1997. Requests mailed to HCFA

should be sent to: Health Care Financing

Administration; Center for Health Plans

and Providers; Attention: Stephen

Phillips, Technical Advisor; Division of

Acute Care; C5–06–27; 7500 Security

Boulevard; Baltimore, MD 21244–1850.

Each request also must be sent to the

hospital’s fiscal intermediary. The

intermediary will review requests upon

receipt and contact HCFA immediately

to discuss its findings.

As noted in the proposed rule, after

mid-August, we will make changes to

the hospital wage data only in those

very limited situations involving an

error by the intermediary or HCFA that

the hospital could not have known

about before its review of the August

wage data file. Specifically, after that

point, neither the intermediary nor

HCFA will accept the following types of

requests in conjunction with this

process:

• Requests for wage data corrections

that were submitted too late to be

included in the data transmitted to

HCRIS on or before June 16, 1997.

• Requests for correction of errors

that were not, but could have been,

identified during the hospital’s review

of the March 1997 data.

• Requests to revisit factual

determinations or policy interpretations

made by the intermediary or HCFA

during the wage data correction process.

Verified corrections to the wage index

received timely (that is, by September

15, 1997) will be effective October 1,

1997.

We believe the wage data correction

process described above provides

hospitals with sufficient opportunity to

bring errors in their wage data to the

intermediary’s attention. Moreover,

because hospitals had access to the

wage data in mid-August, they will have
45990 Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations

had the opportunity to detect any data

entry or tabulation errors made by the

intermediary or HCFA before the

implementation of the FY 1998 wage

index on October 1, 1997. If hospitals

avail themselves of this opportunity, the

wage index implemented on October 1

should be free of such errors.

Nevertheless, in the unlikely event that

such errors should occur, we retain the

right to make midyear changes to the

wage index under very limited

circumstances.

Specifically, in accordance with

§ 412.63(s)(2), we may make midyear

corrections to the wage index only in

those limited circumstances where a

hospital can show: (1) that the

intermediary or HCFA made an error in

tabulating its data; and (2) that the

hospital could not have known about

the error, or did not have an opportunity

to correct the error, before the beginning

of FY 1998 (that is, by the September 15,

1997 deadline). As indicated earlier,

since a hospital will have had the

opportunity to verify its data, and the

intermediary will notify the hospital of

any changes, we do not foresee any

specific circumstances under which

midyear corrections would be made.

However, should a midyear correction

be necessary, the wage index change for

the affected area will be effective

prospectively from the date the

correction is made.

E. Modification of the Process and

Timetable for Updating the Wage Index

Although the wage data correction

process described above has proven

successful for ensuring that the wage

data used each year to calculate the

wage indexes are generally reliable and

accurate, we expressed concern in the

proposed rule that there have been an

excessive number of revisions being

requested after the release of the wage

data in mid-March. Last year, in

developing the FY 1997 wage index, the

wage data were revised between the

proposed and the final rules for more

than 13 percent of the hospitals

(approximately 700 of 5,200). The

number of revisions this year was

similar. Since hospitals are expected to

submit complete and accurate data, and

the data are reviewed and edited by the

intermediaries and HCFA, we believe

that we should be making few revisions

after the release of the March wage data

file. According to information received

from the intermediaries, these late

revisions are partly due to the lack of

responsiveness of hospitals in providing

sufficient information to the

intermediaries during the desk reviews

(that is, during the intermediary’s

review of the hospital’s cost report).

Our analysis of last year’s wage data

also showed that, although the volume

of revisions was high, the effect of the

changes on the wage index was

minimal. Of the 370 labor market areas,

only 4 (1.1 percent) experienced a

change of 5 percent or more in their

wage index value and only 39 (10.6

percent) experienced a change of 1

percent or more. Thus, the intensity of

work that must be performed in order to

incorporate these revisions in the 1

month available between the mid-June

date for revision requests and the midJuly date by which we must begin

calculation of the final wage index is

not warranted in light of the minimal

changes to the actual wage index values.

Another feature of the current process

is that it results in corrections to the

final wage index after the September 1

final rule publication and before the

October 1 effective date of the wage

index. Immediately following the

development of the final wage index, a

second wage data file is made available

in mid-August so that hospitals may

again verify the accuracy of their wage

data. If a hospital detects an error made

by the intermediary or HCFA in the

handling (entry or transmission) of the

wage data, the hospital may request a

correction (this year, by September 15).

The corrections are published in the

Federal Register after the October 1

implementation date in a correction

notice to the final rule. We would prefer

to minimize the need to republish

certain wage index values after the final

rule is in effect.

Finally, hospitals base their

geographic reclassification decisions

(whether or not to withdraw their

applications) on the wage index

published in the proposed rule.

Although the FY 1997 proposed and

final wage indexes were quite similar,

we cannot ensure this will happen each

year if increasing numbers of hospitals

delay the submittal to their

intermediaries of wage data supporting

documentation until the May 15

deadline. We believe that hospitals

could make more informed decisions

regarding reclassification if the

proposed wage index more closely

resembles the final wage index.

Therefore, in the proposed rule, we

discussed possible revisions to the wage

data verification process.

1. Process and Timetable

The major change we proposed to the

current process was the requirement

that wage data revisions be requested

(and resolved) earlier, before

publication of the proposed rule.

Subsequent corrections would be

allowed only for errors in handling the

data (our current timetable allows for

such corrections after the final rule is

published). For example, the FY 1999

wage index will use FY 1995 cost report

data (that is, cost reports beginning in

FY 1995) and become effective October

1, 1998. Under the proposed timetable,

hospitals would be required to submit

all requests for wage data revisions to

their intermediary by mid-December

1997. We indicated this would provide

ample opportunity for hospitals to

evaluate the results of intermediaries’

desk reviews and prepare any requests

for corrections. We noted that the desk

reviews are to be performed on an

ongoing basis as cost reports are

received from hospitals and, for the FY

1995 wage data, must be completed

prior to the mid-November 1997

deadline for submitting all FY 1995

wage data to HCRIS.

As under the current process, after

reviewing requests for wage data

revisions submitted by hospitals, fiscal

intermediaries would transmit any

revised cost report to HCRIS and

forward a copy of the revised wage

index Worksheet S–3 to the hospital. If

requested revisions are not accepted, the

fiscal intermediaries would notify the

hospital in writing of reasons why the

changes were not accepted. We believe

that fiscal intermediaries are generally

in the best position to make evaluations

regarding the appropriateness of a

particular cost and whether it should be

included in the wage index data.

However, if a hospital disagrees with

the intermediary’s policy interpretation,

the hospital may contact HCFA in an

effort to resolve the dispute. All policy

issues would be resolved by midJanuary.

The proposed timetable for

developing the annual update to the

wage index was as follows (an asterisk

indicates no change from prior years):

Mid-November* All desk reviews for

hospital wage data are completed and

revised data transmitted by

intermediaries to HCRIS.

Mid-December Deadline for hospitals

to request wage data revisions and

provide adequate documentation to

support the request.

Mid-January Deadline for

intermediaries to submit to HCRIS all

revisions resulting from hospitals’

requests for adjustments (as of midDecember) (and verification of data

submitted to HCRIS (as of midNovember)).

Early April Edited wage data are

available for release to the public.

May 1* Proposed rule published with

60-day comment period and 45-day

withdrawal deadline for geographic

reclassification.
Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations 45991

Early May (2 weeks after publication of

proposed rule) Deadline for

hospitals to notify HCFA and

intermediary that wage data are

incorrect due to mishandling of data

(that is, error in data entry or

transmission) by intermediary or

HCFA.

Late May (2 weeks after previous

deadline) Deadline for

intermediaries to transmit all

revisions to HCRIS.

September 1* Publication of the final

rule.

October 1* Effective date of updated

wage index.

The most significant change reflected

in the proposed timetable is that we

would no longer make available a

preliminary wage data file prior to

hospitals’ final opportunity to request

corrections.

As noted in section V of this

preamble, section 4644(b) of Public Law

105–33 requires that, beginning with FY

1999, we publish a proposed rule on

changes to the prospective payment

system by April 1 prior to the fiscal year

when such changes are to become

effective, and a final rule by August 1.

In light of this and for other reasons

discussed below, we are revising this

proposed timetable for preparing the FY

1999 wage index to allow for release of

a public use file containing the edited

preliminary FY 1995 wage data.

2. Cost Reporting Timetable

In the proposed rule, we stated that

the proposed timetable would not

significantly alter the time hospitals

have to ensure the accuracy of their

data. In developing the wage index for

a given fiscal year, we use the most

recent, reviewed wage data, that is,

wage data from cost reports that began

in the fiscal year 4 years earlier. For

example, for the FY 1999 wage index,

we will use data from cost reporting

periods beginning in FY 1995. Hospitals

must submit cost reports to their

intermediaries within 150 days of the

end of their cost reporting periods. Once

the cost report is received, the

intermediary has 12 months to review

and settle it.

As part of the settlement process, we

require intermediaries to conduct a desk

review of the wage data. The desk

review program for hospital wage data

targets potentially aberrant data and

checks the completeness and accuracy

of the data, including verifying that

reported costs are in conformance with

our policy, before they are used in

calculating the wage index. The

intermediary checks the wage data and

supporting documentation submitted by

the hospital and contacts the hospital if

additional information is needed to

verify the accuracy of the data. When it

is necessary for the intermediary to

adjust a hospital’s wage data, the

intermediary notifies the hospital in

writing of the change to the cost report

and hospitals then have the opportunity

to request adjustments. This would

continue to be the case.

Since intermediaries must settle cost

reports within 12 months of their

receipt, most of the cost reports are

settled by the time we compile the data

to calculate the wage index. We note,

however, that the annual update of the

wage index is not tied directly to the

cost report settlement process since

extensions or reopenings of settled cost

reports may be granted.

The following is an illustration of the

process for settling a typical cost report

beginning in FY 1995. Of course,

hospitals’ cost reporting periods may

begin at any time during the year.

January 1, 1995 Cost reporting period

begins.

December 31, 1995 Cost reporting

period ends.

May 31, 1996 Cost report must be

submitted by the hospital to the

intermediary.

July 31, 1996 Cost report must be

transmitted by the intermediary to

HCRIS.

May 31, 1997 Cost report must be

settled by the intermediary. (Desk

review of hospital wage data is

performed on an ongoing basis by the

intermediary before the cost report is

settled.)

July 31, 1997 Settled cost report must

be transmitted by the intermediary to

HCRIS.

Comment: One association

representing fiscal intermediaries

objected to our statement that the

intermediaries must settle cost reports

within 12 months of their receipt. The

commenter stated that this is not

consistent with our current audit and

reimbursement performance standards.

Response: The regulations at

§ 405.1835(c) provide that the

intermediary has up to 12 months from

receipt of a cost report in which to settle

it. For purposes of the contractor

performance evaluation program (CPEP)

for FY 1997, the standard is that the

intermediary has at least 21 months

from receipt of a hospital’s cost report

in which to settle it. While we are not

changing the CPEP instructions or

standards for FY 1997, the instructions

are subject to change from year to year.

Therefore, in the discussion of the wage

index timetable, we used the cost report

settlement information from the

regulations, which are relatively

constant, not the performance

evaluation standard, which is subject to

change from year to year. Since we are

required by statute to update the wage

index on an annual basis, the wage

index update is not tied directly to the

cost report settlement process as the

settlement may be delayed for several

reasons, including allowances by the

CPEP, extensions, and reopenings.

Comment: The same commenter was

also concerned that the proposed

modification to the timetable for

developing the FY 1999 wage index

would require intermediaries to

complete desk reviews for two cost

reporting periods within the same

budget year and that this substantial

increase in work would require

additional funding.

Response: Regarding the commenter’s

concern that additional funding would

be needed to handle the increased desk

review workload (which would result

from revising the timetable as

proposed), in the instructions for the

wage index desk review the

intermediaries are instructed to perform

the desk reviews as the cost reports are

received. We do not agree with the

commenter’s assertion that shortening

the timeframe for developing the wage

index will result in a substantial

increase in the intermediaries’

workload. In fact, as we pointed out in

the preamble to the proposed rule,

under the current process,

intermediaries are required to verify the

inclusion and accuracy of all hospitals’

wage data twice during the wage index

development. Our proposed timetable

would have eliminated the need for the

second verification by the

intermediaries.

Comment: One hospital association

suggested that the number of late

revisions could be reduced if

intermediaries completed the wage data

desk reviews within 60 days from

receipt of hospitals’ cost reports and if

HCFA and the intermediaries would use

the same edits. Others commented that

HCFA’s edits are unrealistic and that

improved edits would reduce the need

for a preliminary wage data file.

Response: We agree with the

commenter’s suggestion that the number

of late revisions could be reduced if

intermediaries completed the wage data

desk reviews soon after receipt of the

hospitals’ cost reports. There is a desk

review being developed to perform an

automated review of the entire cost

report, including the hospital wage

index information, as the cost reports

are received by the intermediary. The

expectation is that desk review would

integrate the editing of the wage data

and the other cost report data, as well
45992 Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations

as eliminate the need for a separate desk

review of the wage data by the

intermediary and editing of the wage

data by HCFA. Until that desk review is

in place, the wage data desk review is

a necessary part of the annual update to

the wage index.

Regarding the edits, the same types of

edits are used by HCFA and the

intermediaries. The initial edits,

performed by the intermediary in the

desk review, are broad in order to

identify problem areas. We then perform

a more focused review, using the same

types of edits as in the desk review,

once the data are received and

aggregated. Also, additional edits on the

aggregated data are performed. We

update the wage data edits each year

and will reevaluate and revise the types

and thresholds of the edits to better

identify incomplete or inaccurate data.

3. The Final Revised Timetable for

Finalizing Wage Data

We received approximately 40

comments regarding our proposal to

reduce the amount of time for

developing the wage index.

Comment: Most of the commenters

were opposed to our proposal, stating

that it would reduce the number of days

that the hospital industry has for

reviewing the wage data. Another

commenter believes that the fact that the

preliminary wage data file is released

only 2 months prior to the mid-May

deadline for revisions is the main cause

of late submissions. One hospital added

that the expedited timeframe would be

disadvantageous for rural hospitals,

especially in an environment in which

their wage index values are decreasing

while the urban values are increasing.

Response: We continue to believe that

expediting the resolution of all wage

data issues earlier in the process will

improve the accuracy of the wage index.

Hospitals are ultimately responsible for

the accuracy of their cost report

information. Because intermediaries are

required to notify hospitals of changes

to their cost reports, including those

affecting the wage data, we do not agree

that the timing of the release of the

preliminary data file is the cause for the

volume of last minute revisions.

Hospitals should know what is included

in their wage data well before the

release of this file. In fact, our intent in

releasing the preliminary data file is

primarily to allow hospitals to verify

that the data on file at HCFA matches

their latest wage data information. We

remain concerned that the release of the

preliminary file itself and the final

opportunity for revisions it provides

actually encourages hospitals to wait to

request revisions until after its release.

With regard to the comment that the

proposed timetable would adversely

impact rural hospitals, it is not clear to

us from the comment how this proposal

would have that effect. By placing

greater emphasis on individual

hospitals to ensure the accuracy of their

data earlier in the process, we believe

the result would be a more accurate

wage index overall.

Comment: Two commenters stated

that they agreed that the schedule for

developing the wage data should be

shortened, but that HCFA should

continue to make available the

preliminary wage data file. A few

commenters suggested that the

preliminary file could be released to the

public earlier, for example, in midDecember (about 30 days after the

deadline for the intermediaries to

transmit the data to HCRIS) to reduce

the amount of late changes.

Response: Due to the requirement that

the changes to the inpatient prospective

payment system be published one

month earlier (beginning with FY 1999),

we have no choice but to expedite this

process. Although commenters

suggested that a preliminary file could

be released in mid-December, that date

would not provide sufficient time for

the fiscal intermediaries to verify

hospitals’ data that are included on the

file. We believe it would be

counterproductive to ask the industry to

review the data file prior to the fiscal

intermediaries’ verification. However, in

light of the concerns about eliminating

the preliminary file, we plan to make

available an edited, preliminary FY

1995 wage data file in February 1998.

Comment: Several commenters stated

that since the wage data requirements in

the FY 1995 cost report have changed

significantly from previous years, it

would be inappropriate to implement an

expedited process for the FY 1999 wage

index. Two hospital associations

commented that they evaluated

preliminary FY 1995 wage data from the

HCRIS Minimum Data Set and

concluded that the data showed serious

reporting problems.

Many of the commenters stated that

the hospital industry uses the

preliminary file to evaluate the quality

of the wage data and to ensure that

Medicare payment is properly allocated

among hospitals. Some of the

commenters said that the wage data

would likely be less accurate without

the industry’s review of the preliminary

wage data file. One association added

that, without the edited preliminary file,

those evaluating hospital wage data

would have to rely on the HCRIS file,

which is less accurate and less

complete.

Response: Effective with cost

reporting periods beginning on or after

October 1, 1994, we revised the

Medicare cost report to provide for the

separate reporting of all salary costs for

physicians (including teaching

physicians), residents, and CRNAs. In

addition, in order to analyze the

feasibility of excluding overhead costs

attributable to skilled nursing facilities

and other excluded areas, overhead cost

data is collected by cost center. After

evaluating these data, we will consider

appropriate changes in developing the

FY 1999 and future wage index updates.

Thus, we have decided to release a

preliminary wage data file for the FY

1999 wage index prior to hospitals’ final

opportunity to request corrections. The

combination of the changes to the FY

1995 wage data, the earlier publication

schedule, and the comments we

received regarding the timing of

intermediaries’ audits caused us to

reverse our intention to eliminate the

preliminary data file during the

processing of the FY 1999 wage index

and to make other adjustments.

Therefore, we are making several

changes to the current timetable as well

as the timetable we proposed. The most

significant of these changes is that the

preliminary public use file will now be

made available in February (we will

contact the hospital industry regarding

the precise release date), and that

hospitals will then have 30 days (rather

than the current 60 days) to request

revisions to their data. This shortened

review period is necessitated by the

earlier publication date and our intent

to eliminate the need for an annual

correction notice reflecting changes due

to data handling errors.

We believe that this will enable us to

utilize the hospital industry’s analyses

to help ensure the accuracy of the data.

However, due to the earlier publication

schedule, hospitals will have only 30

days to review their data and request

adjustments. We believe the trade-off

between making preliminary data

available earlier and shortening the time

for review is fair. Intermediaries will

have 30 days to review the requests,

make their determinations, and transmit

the revised data to HCRIS.

We plan to release a final wage data

file in May for the limited purpose of

allowing hospitals the opportunity to

identify errors made by HCFA or the

intermediary in the transmission of the

final wage data. We anticipate that this

revised timetable will meet our

objective of enabling us to correct any

data errors contained in the final wage

data file prior to publication of the final

rule on August 1.
Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations 45993

Thus, the final revised timetable is as

follows:

Mid-November—All desk reviews for

hospital wage data are completed and

revised data transmitted by fiscal

intermediaries to HCRIS.

Early February—Edited wage data are

available for release to the public.

Early March—Deadline for hospitals

to request wage data revisions and

provide adequate documentation to

support the request.

Early April—Deadline for

intermediaries to transmit appropriate

revised wage data to HCRIS.

April 1—Proposed rule published

with 60-day comment period and 45-

day withdrawal deadline for geographic

reclassification.

Early May—Final wage data are

available for release to the public.

Early June—Deadline for hospitals to

notify HCFA and their fiscal

intermediary that wage data are

incorrect due to mishandling of data

(that is, an error in data entry or

transmission) by intermediary or HCFA.

August 1—Publication of the final

rule.

October 1—Effective date of updated

wage index.

We believe this timetable, like the

timetable reflected in the proposed rule,

is a logical step in the evolution of the

process for compiling the wage data

used to calculate the hospital wage

index. For a number of years, the

hospital wage index was based on a

wage survey that was not updated every

year. Applicable policies permitted

hospitals to request and receive midyear

corrections to the data on the wage

survey. Beginning with FY 1994

(beginning on October 1, 1993), we used

wage data submitted by hospitals on

Worksheet S–3, Part II of the hospital

cost report, and we update the wage

data every year. We revised our wage

data process accordingly—we stopped

making midyear corrections to the wage

data (except under very limited

circumstances, as noted below), and

instead attempted to finalize the wage

data by the final rule.

The new timetable would shorten the

time for revisions somewhat further.

Because we have used cost report data

for 5 years now, hospitals should be

well aware of the importance of

submitting accurate wage data on the

Worksheet S–3, Part II. Also, as

intermediaries and hospitals have

become increasingly familiar with the

data collection and verification process,

handling the data has become more

routine and streamlined. For example,

over the past year, we have greatly

improved the overall efficiency of our

communications with the

intermediaries through greater reliance

on electronic transmission of wage data.

In short, then, there should be less need

for revising wage data after desk

reviews, and we believe it is reasonable

and appropriate to revise the timetable

for requesting and resolving wage data

revisions.

We would continue to make midyear

corrections to the wage index in

accordance with § 412.63(s)(2), in those

limited circumstances where a hospital

can show: (1) that the intermediary or

HCFA made an error in tabulating its

data; and (2) that the hospital could not

have known about the error, or did not

have an opportunity to correct the error,

before the beginning of the fiscal year.

Although we do not anticipate that such

situations would arise, this regulation

would remain unchanged.

F. Wage Index Workgroup

As stated in the proposed rule, we are

concerned that the rapid and dramatic

changes occurring in hospitals’

operating environments, combined with

the current time lag in the data used to

construct the wage index, is leading to

a situation where the wage index may

be becoming less representative of

hospitals’ current labor costs. Hospitals’

increasing reliance on contract labor for

a broadening array of functions, hospital

mergers and the development of

integrated delivery systems, and the

expansion of the prospective payment

system to other sites of care are factors

that indicate a need for a concerted

effort to ensure that the data required for

calculating the wage index are available

and reliable. Furthermore, despite the

improvements that resulted from the

work of the special Medicare Technical

Advisory Group (MTAG) several years

ago, technical questions about the

treatment of certain types of labor costs

continue to arise.

For these reasons, we believe there is

a need for an ongoing workgroup to

address wage index related issues

periodically. We solicited input from

representatives of the hospital industry

(and other provider types interested in

the collection of wage data) regarding

the need for such a workgroup and their

willingness to participate. We also

sought public input regarding the

structure and scope of such a

workgroup.

Comment: The response to the

proposed wage index workgroup was

favorable. Some commenters believe the

group should be formally established

and meet on a regular basis to ensure

the attention and resources needed to

accomplish its objectives. Several

commenters recommended that the

wage index workgroup be formed under

the auspices of the MTAG. Another

commenter suggested that a workgroup

formed on an ad hoc basis, with one or

more specific issues to address, might

be the best way to structure the group.

Several commenters stated that the

group’s agenda should be broadly

defined to encompass input price

adjustment issues related to hospitals,

skilled nursing facilities, home health

agencies, rehabilitation facilities, and

managed care plans. Some commenters

expressed interest in participating in

such a workgroup.

Response: We will proceed with the

development of the wage index

workgroup. We will be in contact with

interested parties to arrange a meeting to

discuss issues related to its structure

and focus. We appreciate the

enthusiastic responses, and believe that

utilization of a workgroup will expedite

many procedural improvements in the

wage index process.

IV. Revising the Hospital Operating

Market Baskets

A. General Discussion

We used a hospital input price index

(that is, the hospital ‘‘market basket’’) to

develop the inflation component update

factors for operating costs. Although

‘‘market basket’’ technically describes

the mix of goods and services used to

produce hospital care, this term is also

commonly used to denote the input

price index (that is, cost category

weights and price proxies combined)

derived from that market basket.

Accordingly, the term ‘‘market basket’’

as used in this document refers to the

hospital input price index.

The terms rebasing and revising,

although often used interchangeably,

actually denote different activities.

Rebasing moves the base year for the

structure of costs of an input price index

(for example, moving the base year cost

structure from FY 1987 to FY 1992).

Revising means changing data sources,

cost categories, or price proxies used in

the input price index for a given base

year. In the August 30, 1996 final rule,

effective for FY 1997, we both rebased

and revised the hospital operating

market baskets (61 FR 46186).

B. Revising the Hospital Market Basket

We used a revised hospital market

basket for the FY 1998 update

framework for the operating prospective

payment rates. In the August 30, 1996

final rule, we discussed the possibility

of revising the market basket when

additional data became available (61 FR

46187). Consistent with that discussion,

we used a revised market basket that

still has a base year of FY 1992, but
45994 Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations

incorporates additional data,

specifically the Asset and Expenditure

Survey, 1992 Census of Service

Industries, by the Bureau of the Census,

Economics and Statistics

Administration, U.S. Department of

Commerce, which did not become

available until after the FY 1997 final

rule was published. (For further

discussion of the differences between

the revised market basket for FY 1998

and the current market basket, see

Appendix C of this final rule with

comment period.)

In the current market basket, data for

four major expense categories (wages

and salaries, employee benefits,

pharmaceuticals, and a residual

category) are from Medicare hospital

cost reports for periods beginning in FY

1992 (that is, periods beginning on or

after October 1, 1991 and before October

1, 1992). These cost reports, which we

refer to as PPS–9 cost reports (the 9th

year of the prospective payment

system), are reported in the Health Care

Provider Cost Report Information

System (HCRIS). In the revised hospital

market basket, we still use the cost

report data, and categories and weights

are unchanged from the current market

basket. Within the residual category, the

categories and weights for nonmedical

professional fees and professional

liability insurance are also unchanged.

(For a detailed discussion of the

determination of weights, see the

August 30, 1996 final rule (61 FR

46187)).

Table 1 shows a comparison of the

current and the revised operating

market basket cost categories, weights,

and price proxies. For the revised

market basket, weights for the

‘‘Utilities’’ and ‘‘All Other’’ cost

categories, as well as most

subcategories, were derived using the

Asset and Expenditure Survey,

published by the Bureau of the Census,

Economics and Statistics

Administration, U.S. Department of

Commerce, in conjunction with the

latest available (1987) Input-Output

Table, produced by the Bureau of

Economic Analysis (BEA), U.S.

Department of Commerce. The 1987

input-output cost shares, aged to 1992

using historical price changes between

1987 and 1992 for each category, were

allocated to be consistent with the

newly available 1992 asset and

expenditure data.

The resulting combined data were

allocated to be consistent with the 1992

hospital cost report data. Revised

relative weights for the base year were

then calculated for various expenditure

categories. This work resulted in the

identification of 22 separate cost

categories in the revised market basket.

Four categories previously separate

were combined with existing categories.

Specifically, Business Services, and

Computer and Data Processing Services

were combined with All Other LaborIntensive Services. Transportation

Services was combined with All Other

Nonlabor-Intensive Services, and the

Fuel, Oil, Coal etc. category was split

between Fuels (nonhighway) and

Miscellaneous Products. We combined

these categories so that the market

basket would conform more closely

with the 1992 Asset and Expenditure

Survey. Detailed descriptions of each of

the four categories and their respective

price proxies can be found in the

August 30, 1996 final rule (61 FR

46323). Changing the structure of the

market basket using the 1992 Asset and

Expenditure Survey allows for a more

accurate reflection of the cost structures

faced by hospitals. When the Bureau of

the Census or the BEA improves

methodologies for the collection and

categorization of data, it is likely the

weights will also change.

TABLE 1.—COMPARISON OF CURRENT 1992–BASED PROSPECTIVE PAYMENT HOSPITAL MARKET BASKET WITH REVISED

1992–BASED PROSPECTIVE PAYMENT HOSPITAL MARKET BASKET

Expense categories Price proxy

Current

1992-

based

PPS market basket 1

Revised

1992-

based

PPS market basket

1. Compensation: .................................................................. ............................................................................................... 61.390 61.390

A. Wages and salaries .................................................. HCFA occupational wage index ........................................... 50.244 50.244

B. Employee benefits ..................................................... HCFA occupational benefits index ....................................... 11.146 11.146

2. Nonmedical professional fees .......................................... ECI-compensation for professional, specialty, and technical 2.127 2.127

3. Utilities: ............................................................................. ............................................................................................... 2.470 1.542

A. Electricity ................................................................... PPI commercial electric power ............................................. 1.349 0.927

B. Fuels (nonhighway) ................................................... PPI commercial natural gas ................................................. 1.015 0.369

C. Water and sewerage ................................................. CPI–U water and sewerage maintenance ........................... 0.106 0.246

4. Professional liability insurance ......................................... HCFA professional liability insurance premium index .......... 1.189 1.189

5. All other expenses: ........................................................... ............................................................................................... 32.825 33.752

A. All other products: ..................................................... ............................................................................................... 24.033 24.825

(1) Pharmaceuticals ................................................... PPI ethical (prescription) drugs ............................................ 4.162 4.162

(2) Food ...................................................................... ............................................................................................... 3.459 3.386

(a) Direct purchase .................................................... PPI processed foods and feeds ........................................... 2.363 2.314

(b) Contract service .................................................... CPI food away from home ................................................... 1.096 1.072

(3) Chemicals ............................................................. PPI industrial chemicals ....................................................... 3.795 3.666

(4) Medical instruments .............................................. PPI medical instruments and equipment ............................. 3.128 3.080

(5) Photographic supplies .......................................... PPI photographic supplies ................................................... 0.399 0.391

(6) Rubber and plastics .............................................. PPI rubber and plastic products ........................................... 4.868 4.750

(7) Paper products ..................................................... PPI converted paper and paperboard products ................... 2.062 2.078

(8) Apparel ................................................................. PPI apparel ........................................................................... 0.875 0.869

(9) Machinery and equipment .................................... PPI machinery and equipment ............................................. 0.211 0.207

(10) Miscellaneous products ...................................... PPI finished goods ............................................................... 1.074 2.236

B. All other services: ...................................................... ............................................................................................... 8.792 8.927

(1) Postage ................................................................. CPI–U postage ..................................................................... 0.272 0.272

(2) Telephone services .............................................. CPI–U telephone services .................................................... 0.531 0.581

(3) All other: labor intensive ....................................... ECI compensation for private service occupations .............. 7.457 7.277

(4) All other: nonlabor intensive ................................. CPI–U all items .................................................................... 0.532 0.796
Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations 45995

TABLE 1.—COMPARISON OF CURRENT 1992–BASED PROSPECTIVE PAYMENT HOSPITAL MARKET BASKET WITH REVISED

1992–BASED PROSPECTIVE PAYMENT HOSPITAL MARKET BASKET—Continued

Expense categories Price proxy

Current

1992-

based

PPS market basket 1

Revised

1992-

based

PPS market basket

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

Note: Due to rounding, weights may not sum to total.

1Expense categories based on revised 1992-based hospital market basket for comparison purposes.

In calculating payments to hospitals,

the labor-related portion of the

standardized amounts is adjusted by the

hospital wage index. As discussed in

the August 30, 1996 final rule (61 FR

46189), for purposes of determining the

labor-related portion of the standardized

amounts, we sum the percentages of the

labor-related items (that is, wages and

salaries, employee benefits, professional

fees, business services, computer and

data processing services, postage, and

all other labor-intensive services) in the

operating hospital market basket.

Effective for FY 1997, this summation

resulted in a labor-related portion of the

hospital market basket of 71.246

percent, and a nonlabor-related portion

of 28.754 percent. Thus, since October

1, 1996, we have considered 71.2

percent of operating costs to be laborrelated for purposes of the prospective

payment system (we rounded to the

nearest tenth).

In connection with the revisions to

the hospital market basket, we have

reestimated the labor-related share of

the standardized amounts. Based on the

relative weights described in Table 2,

the labor-related portion (wages and

salaries, employee benefits, professional

fees, postage, and all other laborintensive services) is 71.066 percent,

and the nonlabor-related portion is

28.934 percent. Accordingly, effective

with discharges occurring on or after

October 1, 1997, we are revising the

labor-related and nonlabor-related

shares of the large urban and other

areas’ standardized amounts used to

establish the prospective payment rates

to 71.1 and 28.9, respectively. The

amounts in Table 2 reflect the revised

labor-related and nonlabor-related

portions. We note that the labor-related

portions of the rates published in Table

2 have remained approximately the

same. The labor-related portion has

decreased from 71.2 percent to 71.1

percent.

TABLE 2.—LABOR-RELATED SHARE OF

REVISED 1992-BASED PROSPECTIVE

PAYMENT HOSPITAL MARKET BASKET

Cost category Weight

Wages and salaries ........................ 50.244

Employee benefits .......................... 11.146

Professional fees ............................ 2.127

Postal services ................................ 0.272

All other labor intensive .................. 7.277

Total labor-related ................... 71.066

Total nonlabor-related ............. 28.934

Comment: We received comments

encouraging us to revisit the market

basket framework annually to adjust for

changes such as additional

administrative costs for hospitals that

revise their Medicare billing procedures

to screen claims in response to current

policies such as the 3-day payment

window and pending legislation such as

the change in definition of a transfer.

Response: When slight adjustments

are made to individual weights within

the hospital market baskets, there is

typically little or no change in the

historical or forecasted market baskets.

A shift in weights from one cost

category to another results in a zero

sum. Cost categories rising in relative

importance are offset by cost categories

falling in relative importance. The total

weight is 100 before and after the shift.

There is an impact on the weighted

average of price changes only when the

price changes (not levels) of the cost

categories shifted are substantially

different. This is not typically the case.

Regarding administrative costs, we

note that rebasing the market basket is

done at 5-year intervals. In the interim,

additional costs for administration are

appropriately handled in the update

framework, which includes factors such

as hospital productivity and intensity of

services.

Comment: We received a comment

requesting that the market baskets be

revised again when more recent InputOutput Tables become available from

the Bureau of Economic Analysis. The

commenter also questioned changes to

the market baskets that (1) reduce

weights within the utilities cost category

by moving some of the weight to the

miscellaneous products category and (2)

combine business and computer

services into all other labor-intensive

services.

Response: The changes in weights in

the revised market baskets are the result

of using data from the Asset and

Expenditure Survey. We did a

sensitivity analysis in which we

developed a test index identical to the

revised prospective payments market

basket except that the weights and

proxies for the current version of ‘‘All

Other Services’’ were substituted for

those in the revised market basket’s ‘‘All

Other Services’’ category. For the

historical and forecast period of 1992–

2002, half of the years showed no

difference and half showed a 0.1

percentage point difference in the

percent change upon which updates are

based. We feel that the revised market

baskets represent an improvement in

cost categories and price proxies, and

therefore are better measures of

composite price changes. When the

Input-Output Tables for 1992 become

available we will review these data

carefully. Revised Input-Output data are

automatically included in rebasing on a

regular schedule (approximately every 5

years).

C. Selection of Price Proxies

Only four categories that are part of

the current hospital market basket do

not appear in the revised hospital

market basket. Of the 22 categories that

are part of both the current and the

revised market baskets, only the weights

might differ. The wage and price proxies

selected for these cost categories are the

same as those selected last year. A

description and discussion of each price

proxy are set forth in the August 30,

1996 final rule (61 FR 46324). The price

proxies are shown in Table 1, above.

The makeup of the HCFA Blended

Occupational Wage Index and the HCFA

Blended Occupational Benefits Index

used as proxies for Wages and Salaries
45996 Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations

and Employee Benefits, respectively,

remain the same as last year. (See 61 FR

27463.)

To examine the impact of the changes

to the weights and the reduction of the

number of cost categories, we developed

a comparison for the period FY 1994

through FY 1999. Using historical data

for FY 1994 through FY 1996, and

forecasts for FY 1997 through FY 1999

for the prospective payment market

basket, we compared the percentage

changes for the current and the revised

market baskets.

TABLE 3.—COMPARISON OF THE CURRENT PROSPECTIVE PAYMENT HOSPITAL MARKET BASKET AND THE REVISED

PROSPECTIVE PAYMENT HOSPITAL MARKET BASKET PERCENT CHANGE, FY 1994–1999

Federal fiscal year

Current

hospital

market

basket

Revised

hospital

market

basket

Difference

Historical:

1994 .................................................................................................................................................................... 2.6 2.6 0.0

1995 .................................................................................................................................................................... 3.2 3.2 0.0

1996 .................................................................................................................................................................... 2.5 2.4 ¥0.1

Forecasted:

1997 .................................................................................................................................................................... 2.3 2.1 ¥0.2

1998 .................................................................................................................................................................... 2.7 2.7 0.0

1999 .................................................................................................................................................................... 3.0 2.9 ¥0.1

Historical average: 1994–1996 ................................................................................................................................. 2.8 2.7 ¥0.1

Forecasted average: 1997–1999 ............................................................................................................................... 2.7 2.6 ¥0.1

Note that the historical average rate of

growth for 1994 through 1996 for the

improved revised prospective payment

hospital market basket is almost equal to

that of the current market basket. The

0.1 percentage point difference is less

than the +/¥ 0.25 percent threshold for

corrections for forecast error. The

forecasted average rate of growth for

1997 through 1999 for the revised

market basket is 0.1 percentage points

less than that of the current market

basket.

D. Separate Market Basket for Hospitals

and Hospital Units Excluded From the

Prospective Payment System

As in the prospective payment

hospital market basket, weights for the

six main cost categories contained in the

excluded hospital market basket (that is,

weights for wages and salaries,

employee benefits, professional fees,

malpractice insurance, pharmaceuticals,

and the residual category) remain the

same. Only the weights for ‘‘Utilities’’

and the categories within ‘‘All Other’’

have been revised. Table 4 below shows

weights for the current and revised

1992-based excluded hospital market

basket.

TABLE 4.—COMPARISON OF CURRENT 1992-BASED EXCLUDED HOSPITAL MARKET BASKET WITH REVISED 1992-BASED

EXCLUDED HOSPITAL MARKET BASKET

Expense categories Price proxy

Current

1992-

based excluded

market

basket 1

Revised

1992-

based excluded

market

basket

1. Compensation: .................................................................. ............................................................................................... 63.721 63.721

A. Wages and salaries .................................................. HCFA occupational wage index ........................................... 52.152 52.152

B. Employee benefits ..................................................... HCFA occupational benefits index ....................................... 11.569 11.569

2. Nonmedical professional fees .......................................... ECI-compensation for professional, specialty, and technical 2.098 2.098

3. Utilities .............................................................................. ............................................................................................... 2.557 1.675

A. Electricity ................................................................... WPI commercial electric power ............................................ 1.396 1.007

B. Fuels (nonhighway) ................................................... WPI commercial natural gas ................................................ 1.051 0.401

C. Water and sewerage ................................................. CPI–U water and sewerage maintenance ........................... 0.110 0.267

4. Professional liability insurance ......................................... HCFA professional liability insurance premium index .......... 1.081 1.081

5. All other expenses ............................................................ ............................................................................................... 30.541 31.425

A. All other products ...................................................... ............................................................................................... 23.640 24.227

(1) Pharmaceuticals ................................................... PPI ethical (prescription) drugs ............................................ 3.070 3.070

(2) Food ...................................................................... ............................................................................................... 3.581 3.468

(a) Direct purchase .................................................... PPI processed foods and feeds ........................................... 2.446 2.370

(b) Contract service .................................................... CPI food away from home ................................................... 1.135 1.098

(3) Chemicals ............................................................. PPI industrial chemicals ....................................................... 3.929 3.754

(4) Medical instruments .............................................. PPI medical instruments and equipment ............................. 3.238 3.154

(5) Photographic supplies .......................................... PPI photographic supplies ................................................... 0.413 0.400

(6) Rubber and plastics .............................................. PPI rubber and plastic products ........................................... 5.039 4.865

(7) Paper products ..................................................... PPI converted paper and paperboard products ................... 2.134 2.182

(8) Apparel ................................................................. PPI apparel ........................................................................... 0.906 0.890

(9) Machinery and equipment .................................... PPI machinery and equipment ............................................. 0.218 0.212

(10) Miscellaneous products ...................................... PPI finished goods ............................................................... 1.112 2.232

B. All other services ....................................................... ............................................................................................... 6.901 7.198

(1) Postage ................................................................. CPI–U postage ..................................................................... 0.282 0.295

(2) Telephone services .............................................. CPI–U telephone services .................................................... 0.549 0.631
Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations 45997

TABLE 4.—COMPARISON OF CURRENT 1992-BASED EXCLUDED HOSPITAL MARKET BASKET WITH REVISED 1992-BASED

EXCLUDED HOSPITAL MARKET BASKET—Continued

Expense categories Price proxy

Current

1992-

based excluded

market

basket 1

Revised

1992-

based excluded

market

basket

(3) All other: labor intensive ....................................... ECI compensation for private service occupations .............. 5.519 5.439

(4) All other: nonlabor intensive ................................. CPI–U all items .................................................................... 0.551 0.833

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

Note: Due to rounding, weights may not sum to total.

1Expense categories based on revised 1992-based hospital market basket for comparison purposes.

V. Other Decisions and Changes to the

Prospective Payment System for

Inpatient Operating Costs

A. Outlier Payments (§§ 412.80, 412.82,

412.84, and 412.86)

1. Elimination of Day Outlier Payments

Section 1886(d)(5)(A) of the Act

provides for payments in addition to the

basic prospective payments for ‘‘outlier’’

cases, that is, cases involving

extraordinarily high costs (cost outliers)

or long lengths of stay (day outliers).

That section also provides that,

beginning with FY 1995, payments for

day outliers will be phased out over 3

years. We have discussed this phase out

and its implementation in detail in the

September 1, 1994, September 1, 1995,

and August 30, 1996 final rules (59 FR

45366, 60 FR 45854, and 61 FR 46228,

respectively). Since payment for day

outliers will be eliminated effective

with discharges occurring in FY 1998,

we proposed conforming revisions to

the regulations at §§ 412.80, 412.82,

412.84, and 412.86. At the same time,

we proposed to make a technical change

to the provision concerning outlier

payments for transfer cases to conform

the regulations to policies that we have

stated in previous prospective payment

system rules but did not codify. See the

final rules published September 1, 1995

(60 FR 45804) and September 1, 1993

(58 FR 46306–07).

We received no comments on these

conforming changes and are

incorporating them in this final rule

with comment period as proposed.

2. Changes to Outlier Payments in Pub.

L. 105–33

Section 4405 of Public Law 105–33

amended sections 1886 (d)(5)(B)(i)(I)

and (d)(5)(F)(ii)(I) of the Act to provide

that, in determining the additional

payment for indirect medical education

(IME) and/or disproportionate share

hospitals (DSH), the IME and DSH

adjustment factors are applied only to

the base DRG payment, not the sum of

the base DRG payment and any cost

outlier payments, effective with

discharges occurring on or after October

1, 1997. The same section of Pub. L.

105–33 also amended section

1886(d)(5)(A)(ii) of the Act to require

that the fixed loss cost outlier threshold

is based on the sum of DRG payments

and IME and DSH payments for

purposes of comparing costs to

payments. Therefore, we are revising

our regulations at § 412.84(g) to remove

the provision that costs be reduced by

the IME and DSH adjustment factors for

purposes of comparing costs to

payments to determine if costs exceed

the fixed loss cost outlier threshold, as

well as deleting current § 412.80(c).

Conforming changes are made at current

§ 412.105(a) (IME) and § 412.106(a)(2)

(DSH). We are also making a

corresponding change to the capital cost

outlier methodology. We received two

public comments urging us to

implement this provision in the final

rule.

As indicated above, one change

resulting from Pub. L. 105–33 is that, in

determining whether a case meets the

cost outlier threshold, we will not

standardize the costs of the case to

account for IME and DSH payments.

The following examples show the effect

on two hospitals of this change in

methodology. In the example, we use

DRG 286, which has a relative weight of

2.2671. Each hospital has a wage index

of 1. The labor-related national large

urban standardized amount is

$2,776.21; the nonlabor-related large

urban standardized amount is

$1,128.44.

Before the Change

Standard Cost = (Billed Charges × Cost

to Charge Ratio) ÷ (1 + IME + DSH)

Outlier Payments = (80 percent of

(Standard Cost—Threshold)) * (1 +

IME + DSH)

Total Payments = Outlier Payments +

(Federal Rate × (1 + IME + DSH))

IME and

DSH hospital

Non-IME,

Non-DSH

hospital

Billed charges ... $100,000 $100,000

IME adjustment

factor .............. 0.0744 0.0

DSH adjustment

factor .............. 0.1413 0.0

Cost to charge

ratio ................ 0.72 0.72

Standard cost .... $59,225.14 $72,000

Outlier threshold $17,806.30 $17,806.30

Outlier payments $40,282.30 $43,354.96

Total payments $51,043.96 $52,207.19

Even with high IME and DSH

adjustments, the IME and DSH hospital

receives a lower payment for an

identical outlier case. This case uses the

fixed loss outlier threshold of $7,600

from the proposed rule.

In the following example, the IME and

DSH hospital’s costs are not adjusted for

IME and DSH. The outlier threshold

amount includes IME and DSH

payments. There are no IME and DSH

payments for outliers. The outlier

threshold increases under this method

for all hospitals.

After the Change

Standard Cost = (Billed Charges × Cost

to Charge Ratio)

Outlier Payments = 80 percent of

(Standard Cost—Threshold)

Total Payments = Outlier Payments +

(Federal Rate × (1 + IME + DSH))

ME and

DSH hospital

Non-IME,

non-DSH

hospital

Billed charges ... $100,000 $100,000

IME adjustment

factor .............. 0.0744 0.0

DSH adjustment

factor .............. 0.1413 0.0

Cost to charge

ratio ................ 0.72 0.72

Standard cost .... $72,000 $72,000

Outlier threshold $20,961.91 $19,052.49

Outlier payments $40,830.47 $42,358.01

Total payments $51,592.13 $51,210.24
45998 Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations

This case uses the final fixed loss

threshold of $11,050 for FY 1998. The

fixed loss threshold increase from the

proposed rule is due to the higher

standard costs of IME and DSH

hospitals.

B. Rural Referral Centers (§ 412.96)

Under section 1886(d) of the Act,

hospitals generally are paid by the

Medicare program for inpatient hospital

services covered by Medicare in

accordance with the prospective

payment system. Certain hospitals,

however, receive special treatment

under that system. Section

1886(d)(5)(C)(i) of the Act specifically

provides for exceptions and adjustments

to prospective payment amounts, as the

Secretary deems appropriate, to take

into account the special needs of rural

referral centers.

Section 412.96(d) of the regulations

provides that, for discharges occurring

before October 1, 1994, rural referral

centers received the benefit of payment

for inpatient operating costs per

discharge based on the other urban

payment amount rather than the rural

standardized amount. As of October 1,

1994, the other urban and rural

standardized amounts are the same.

However, rural referral centers continue

to receive special treatment under both

the disproportionate share hospital

payment adjustment and the criteria for

geographic reclassification. One of the

ways that a rural hospital may qualify

as a rural referral center is to meet two

mandatory criteria (specifying a

minimum case-mix index and a

minimum number of discharges) and at

least one of three optional criteria

(relating to specialty composition of

medical staff, source of inpatients, or

volume of referrals). These criteria are

described in detail in § 412.96(c).

1. Case-Mix Index Criteria

Section 412.96(c)(1) sets forth the

case-mix index criteria and provides

that, for cost reporting periods

beginning on or after October 1, 1986, a

hospital’s case-mix index for discharges

‘‘during the Federal fiscal year that

ended 1 year prior to the beginning of

the cost reporting period for which the

hospital is seeking referral center

status’’ must be at least equal to the

national case-mix index value as

established by HCFA or the median

case-mix value for urban hospitals in

the region in which the hospital is

located (excluding hospitals receiving

indirect medical education payments),

whichever is lower. As discussed in the

proposed rule, we feel that the language

in § 412.96(c)(1) does not clearly

address situations in which the Federal

fiscal year does not end exactly 1 year

prior to the beginning of the cost

reporting period for which the hospitals

are seeking referral center status.

Therefore, we clarified which case-mix

index values are used to determine

referral center status. We emphasized

that this clarification represents no

substantive change in policy.

Our policy, which we have applied

consistently since 1986, is that the casemix index used for an individual

hospital in the determination of whether

it meets the case-mix index criterion is

the case-mix index for discharges during

the most recent Federal fiscal year that

ended at least 1 year prior to the

beginning of the cost reporting period

for which the hospital is seeking referral

center status.

We received no comments on our

proposal to revise § 412.96(c)(1) to

clarify the time period used to calculate

the case-mix index, and we are adopting

it as proposed.

2. Updated Case-Mix and Discharge

Criteria

As noted above, a rural hospital can

qualify as a rural referral center if the

hospital meets two mandatory criteria

(case-mix index and number of

discharges) and at least one of three

optional criteria (medical staff, source of

inpatients, or volume of referrals). With

respect to the two mandatory criteria, a

hospital may be classified as a rural

referral center if its—

• Case-mix index is at least equal to

the lower of the median case-mix index

for urban hospitals in its census region,

excluding hospitals with approved

teaching programs, or the median casemix index for all urban hospitals

nationally; and

• Number of discharges is at least

5,000 discharges per year or, if fewer,

the median number of discharges for

urban hospitals in the census region in

which the hospital is located. (The

number of discharges criterion for an

osteopathic hospital is at least 3,000

discharges per year.)

a. Case-Mix Index

Section 412.96(c)(1) provides that

HCFA will establish updated national

and regional case-mix index values in

each year’s annual notice of prospective

payment rates for purposes of

determining rural referral center status.

In determining the proposed national

and regional case-mix index values, we

follow the same methodology we used

in the November 24, 1986 final rule, as

set forth in regulations at

§ 412.96(c)(1)(ii). Therefore, the

proposed national case-mix index value

includes all urban hospitals nationwide,

and the proposed regional values are the

median values of urban hospitals within

each census region, excluding those

with approved teaching programs (that

is, those hospitals receiving indirect

medical education payments as

provided in § 412.105).

These values are based on discharges

occurring during FY 1996 (October 1,

1995 through September 30, 1996) and

include bills posted to HCFA’s records

through December 1996. Therefore, in

addition to meeting other criteria, we

proposed that to qualify for initial rural

referral center status, a hospital’s casemix index value for FY 1996 would

have to be at least—

• 1.3525; or

• Equal to the median case-mix index

value for urban hospitals (excluding

hospitals with approved teaching

programs as identified in § 412.105)

calculated by HCFA for the census

region in which the hospital is located

(see the table set forth in the June 2,

1997 proposed rule at 62 FR 29923).

Based on the latest data available (FY

1996 bills received through June 1997),

the final national case-mix value is

1.3529 and the median case-mix values

by region are set forth in the table

below:

Region

Case-mix

index

value

1. New England (CT, ME, MA,

NH, RI, VT) ............................... 1.2322

2. Middle Atlantic (PA, NJ, NY) .... 1.2455

3. South Atlantic (DE, DC, FL,

GA, MD, NC, SC, VA, WV) ....... 1.3701

4. East North Central (IL, IN, MI,

OH, WI) ..................................... 1.2610

5. East South Central (AL, KY,

MS, TN) ..................................... 1.3023

6. West North Central (IA, KS,

MN, MO, NE, ND, SD) .............. 1.2088

7. West South Central (AR, LA,

OK, TX) ..................................... 1.3265

8. Mountain (AZ, CO, ID, MT, NV,

NM, UT, WY) ............................. 1.3476

9. Pacific (AK, CA, HI, OR, WA) .. 1.3450

For the benefit of hospitals seeking to

qualify as referral centers or those

wishing to know how their case-mix

index value compares to the criteria, we

are publishing each hospital’s FY 1996

case-mix index value in Table 3C in

section IV of the Addendum to this final

rule with comment period. In keeping

with our policy on discharges, these

case-mix index values are computed

based on all Medicare patient discharges

subject to DRG-based payment.

b. Discharges

Section 412.96(c)(2)(i) provides that

HCFA will set forth the national and

regional numbers of discharges in each
Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations 45999

year’s annual notice of prospective

payment rates for purposes of

determining referral center status. As

specified in section 1886(d)(5)(C)(ii) of

the Act, the national standard is set at

5,000 discharges. However, we

proposed to update the regional

standards. The proposed regional

standards are based on discharges for

urban hospitals’ cost reporting periods

that began during FY 1995 (that is,

October 1, 1994 through September 30,

1995). That is the latest year for which

we have complete discharge data

available.

Therefore, in addition to meeting

other criteria, we proposed that to

qualify for initial rural referral center

status or to meet the triennial review

standards for cost reporting periods

beginning on or after October 1, 1997,

the number of discharges a hospital

must have for its cost reporting period

that began during FY 1996 would have

to be at least—

• 5,000; or

• Equal to the median number of

discharges for urban hospitals in the

census region in which the hospital is

located. (See the table set forth in the

June 2, 1997 proposed rule at 62 FR

29924.)

Based on the latest discharge data

available, the final median numbers of

discharges for urban hospitals by census

regions are as follows:

Region

Number

of discharges

1. New England (CT, ME, MA,

NH, RI, VT) ............................... 6658

2. Middle Atlantic (PA, NJ, NY) .... 8367

3. South Atlantic (DE, DC, FL,

GA, MD, NC, SC, VA, WV) ....... 7515

4. East North Central (IL, IN, MI,

OH, WI) ..................................... 7290

5. East South Central (AL, KY,

MS, TN) ..................................... 6650

6. West North Central (IA, KS,

MN, MO, NE, ND, SD) .............. 5189

7. West South Central (AR, LA,

OK, TX) ..................................... 5133

8. Mountain (AZ, CO, ID, MT, NV,

NM, UT, WY) ............................. 7982

9. Pacific (AK, CA, HI, OR, WA) .. 5919

We reiterate that, to qualify for rural

referral center status for cost reporting

periods beginning on or after October 1,

1997, an osteopathic hospital’s number

of discharges for its cost reporting

period that began during FY 1996 would

have to be at least 3,000.

We received no comments on the

rural referral center criteria.

3. Retention of Referral Center Status

Section 1886(d)(5)(C)(i) of the Act

states that ‘‘the Secretary shall provide

for such exceptions and adjustments to

the payment amounts * * * as the

Secretary deems appropriate to take into

account the special needs of regional

and national referral centers * * *’’ The

Conference Committee Report

accompanying Public Law 98–21 (the

original legislation implementing the

prospective payment system) contained

little additional language concerning the

definition of ‘‘regional and national

referral centers.’’ The Report did

indicate, however, that they should

include very large acute care hospitals

located in rural areas. Thus, we

established qualifying criteria for

referral center status to identify those

rural hospitals that, because of bed size,

a large number of complicated cases, a

high number of discharges, or a large

number of referrals from other hospitals

or from physicians outside the

hospital’s service area, were likely to

have operating costs more similar to

urban hospitals than to the average

smaller community hospitals. The

regulations implementing the referral

center provision are codified at § 412.96.

In 1984, after a year’s experience with

the referral center criteria, we

determined that once approved for the

referral center adjustment, a hospital

would retain its status for a 3-year

period. At the end of the 3-year period,

we would review the hospital’s

performance to determine whether it

should be requalified for an additional

3-year period. The requirement for

triennial review was added to the

regulations in 1984 (§ 412.96(f)) to be

effective for cost reporting periods

beginning on or after October 1, 1987

(the end of the first 3 years of the

referral center adjustment). However,

since then, three statutory moratoria on

the performance of the triennial reviews

were enacted by Congress. When the

third of these moratoria expired at the

end of cost reporting periods that began

during FY 1994, we implemented the

triennial review requirements and some

hospitals lost their referral center status.

(See the September 1, 1993 final rule (58

FR 46310) for a detailed explanation of

the moratoria and the implementation of

the triennial reviews.)

Hospitals could lose rural referral

center status in other ways. With the

creation of the Medicare Geographic

Classification Review Board (MGCRB)

and a hospital’s ability, beginning in FY

1992, to request that it be reclassified

from one geographic location to another,

we stated that if a referral center was

reclassified to an urban area for

purposes of the standardized amount, it

would, in most instances, be voluntarily

terminating its referral center status.

(See the June 4, 1991 final rule with

comment period (56 FR 25482).) This

was true because, in most instances, a

hospital’s ability to qualify as a ‘‘rural

referral center’’ was contingent upon

(among other criteria) its status as a

rural hospital.

In addition, rural referral centers

located in areas that were redesignated

as urban by the Office of Management

and Budget lost their referral center

status. These hospitals had qualified for

referral center status under criteria

applicable only to hospitals located in

rural areas. OMB’s designation of the

areas to urban status meant that such

hospitals were urban for all purposes

and thus could no longer qualify as

rural referral centers.

Section 4202(b)(1) of Public Law 105–

33 states that, ‘‘Any hospital classified

as a rural referral center by the Secretary

* * * for fiscal year 1991 shall be

classified as such a rural referral center

for fiscal year 1998 and each subsequent

fiscal year.’’ Thus, many of the hospitals

that lost their referral center status for

the reasons listed above must be

reinstated. For the purpose of

implementing this provision, we

consider that a hospital that was

classified as a referral center for any day

during FY 1991 (October 1, 1990

through September 30, 1991) meets the

reinstatement criterion.

We have identified 136 hospitals that

were classified as rural referral centers

in 1991 and are no longer classified as

referral centers at this time. Of these,

approximately 70 lost their referral

center status for failure to meet the

triennial review requirements;

approximately 40 lost their status due to

MGCRB reclassification; approximately

20 were in areas redesignated as urban

by OMB, and 6 hospitals voluntarily

requested withdrawal of their referral

center status.

We are reinstating rural referral center

status for all hospitals that lost the

status due to triennial review or MGCRB

reclassification. The HCFA regional

offices will notify each hospital (and the

hospital’s fiscal intermediary) of their

reinstatement as referral centers

effective October 1, 1997. If a hospital

believes it should be reinstated but does

not receive notification, it should

contact the appropriate regional office.

We are not reinstating rural referral

center status to hospitals in areas

redesignated as urban by OMB or

hospitals that requested withdrawal of

such status. The language of section

4202(b)(1) states that any hospital

classified as a rural referral center for

FY 1991, ‘‘* * * shall be classified as

such a rural referral center for fiscal year

1998 and each subsequent fiscal year.’’

(Emphasis added.) Hospitals located in
46000 Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations

areas redesignated as urban by OMB,

since FY 1991, are no longer physically

located in a rural area and they can no

longer be classified as ‘‘rural’’ referral

centers. We also do not believe the law

intended that referral center

classification be forced on hospitals that

do not want it and we are, therefore, not

reinstating the status of the six hospitals

that requested withdrawal. If, however,

any of these hospitals wish to be

requalified as a referral center, they

should contact their HCFA regional

office.

We note that section 4202(b)(1)

provides reinstatement to only those

hospitals that were classified as rural

referral centers during FY 1991. That is,

any hospital approved as a referral

center after FY 1991 would not be

protected by this provision. We do not

believe that it is equitable or

administratively practical to maintain

two lists of referral centers, that is, a list

of those hospitals approved for referral

center status in 1991 and thus protected

by the reinstatement provision and a list

of those hospitals approved after FY

1991 and not protected by the provision.

Therefore, we are terminating the

requirement for triennial reviews of

referral center status and reinstating all

hospitals that lost referral center status

due to those reviews. Thus, §§ 412.96 (f)

and (g) (1) and (2) are deleted. If we later

discover some hospital or class of

hospitals that we believe should not be

allowed to retain referral center status

because they fail to meet some basic

requirement we believe is essential to

receiving this special designation, we

will consider reinstating some type of

annual or periodic qualifying criteria.

In addition, we recognize that there

are hospitals that qualified for referral

center status after 1991 and that may

have lost that status in a subsequent

year due to reclassification by the

MGCRB. Again, we do not believe it is

equitable or administratively practical

to treat such hospitals differently than

those protected by the provision of

Public Law 105–33. Thus, we believe

that any hospital that lost its referral

center status due to reclassification by

the MGCRB, regardless of whether it

was classified as a referral center during

FY 1991, should be reinstated effective

October 1, 1997. The regional offices

will make every effort to identify and

notify all affected hospitals. However,

hospitals that believe they meet the

criteria for reinstatement but do not

receive notification from the regional

office or their fiscal intermediary,

should contact the appropriate regional

office.

We are also eliminating the policy

that a hospital loses RRC status if it is

reclassified as urban by the MGCRB. We

note that for reclassified hospitals, RRC

status would have no payment effect.

Every effort will be made to process

all reinstatements as quickly as possible.

C. Payment for Medicare-Dependent,

Small Rural Hospitals (§ 412.108)

Section 4204 of Public Law 105–33

amended section 1886(d)(5)(G) of the

Act to reinstate the classification of

Medicare-dependent, small rural

hospitals (MDHs) for cost reporting

periods beginning on or after October 1,

1997 and before October 1, 2001. This

category of hospitals was originally

created by section 6003(f) of the

Omnibus Budget Reconciliation Act of

1989 (Public Law 101–239), enacted on

December 19, 1989, which added a new

section 1886(d)(5)(G) of the Act. As

provided by that law, the special

payment for MDHs was to be available

for cost reporting periods beginning on

or after April 1, 1990 and ending on or

before March 31, 1993. Hospitals

classified as MDHs were paid using the

same methodology applicable to sole

community hospitals; that is, based on

whichever of the following rates yielded

the greatest aggregate payment for the

cost reporting period:

• The national Federal rate applicable

to the hospital.

• The updated hospital-specific rate

using FY 1982 cost per discharge.

• The updated hospital-specific rate

using FY 1987 cost per discharge.

Section 13501(e)(1) of the Omnibus

Budget Reconciliation Act of 1993 (Pub.

L. 103–66), enacted on August 10, 1993,

extended the MDH provision through

discharges occurring before October 1,

1994. Under this revised provision, after

the hospital’s first three 12-month cost

reporting periods beginning on or after

April 1, 1990, the additional payment to

an MDH whose applicable hospitalspecific rate exceeded the Federal rate

was limited to 50 percent of the amount

by which that hospital-specific rate

exceeded the Federal rate.

In reinstating the MDH special

payment for discharges occurring on or

after October 1, 1997 and before October

1, 2001, section 4204 of Public Law

105–33 did not revise either the

qualifying criteria for these hospitals

nor the most recent payment

methodology. Therefore, the criteria a

hospital must meet in order to be

classified as an MDH are the same as

before. Section 1886(d)(5)(G)(iv) of the

Act defines an MDH as any hospital that

meets all of the following criteria:

• The hospital is located in a rural

area.

• The hospital has 100 or fewer beds.

• The hospital is not classified as an

SCH (as defined at § 412.92) at the same

time that it is receiving payment under

this provision.

• In the hospital’s cost reporting

period that began during FY 1987, not

less than 60 percent of its inpatient days

or discharges were attributable to

inpatients entitled to Medicare Part A

benefits.

For the purpose of implementing

section 4204 of Pub. L. 105–33, we

consider that a hospital that meets the

criteria above and that was classified as

an MDH on September 30, 1994 is

reinstated as an MDH. We have

identified 414 hospitals that were

classified as MDHs on September 30,

1994. Of these, 20 hospitals no longer

participate in the Medicare program, 15

hospitals are now classified as SCHs, 6

hospitals are now located in urban

areas, and 5 have more than 100 beds.

We will provide fiscal intermediaries

with a list of the hospitals we have

identified; therefore, hospitals that meet

the criteria for classification as an MDH

and that were classified as an MDH on

September 30, 1994 do not need to take

any action in order to be reinstated as

an MDH. At the time the year-end

settlement is made, the fiscal

intermediary will determine for each

cost reporting period which hospitals

meet the criteria to qualify as MDHs. In

addition, the intermediary will

determine for each cost reporting period

which of the payment options yields the

highest rate of payment to a hospital

that qualifies as an MDH.

We note that classification as an MDH

is not optional. Therefore, hospitals that

meet the criteria in § 412.108(a) are not

eligible for the temporary special

payment provided for in section 4401(b)

of Public Law 105–33 (discussed below

in section IV–D). However, if a hospital

that receives notification that it is being

reinstated as an MDH believes it no

longer meets the criteria because, for

example, it has had an increase in its

bed size to more than 100 beds, it

should contact its fiscal intermediary.

For purposes of determining a

hospital’s bed size, we will continue to

use the same definition (which is

defined for indirect medical education

purposes at § 412.105(b)). That is, the

number of beds in a hospital is

determined by counting the number of

available bed days during the hospital’s

cost reporting period, not including

beds or bassinets in the healthy

newborn nursery, custodial care, and

excluded distinct part units, and

dividing that number by the number of

days in the cost reporting period.
Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations 46001

We are revising §§ 412.90 and 412.108

to reflect the reinstatement of the MDH

special payment.

Section 4204(a)(3) of Public Law 105–

33 permits those hospitals that applied

and were approved for reclassification

to a large urban area for purposes of

receiving the large urban rates through

the MGCRB to decline that

reclassification for FY 1998. Normally,

hospitals approved for reclassification

have only 45 days from the date of the

proposed rule to withdraw their request

for reclassification. However, the statute

provides that, in this situation, hospitals

may withdraw their request for FY 1998

reclassification to a large urban area for

purposes of the standardized amount.

Any hospital that does not requalify for

MDH reinstatement for FY 1998 because

of a reclassification to an urban area by

the MGCRB for FY 1998 will be notified

and given the opportunity to decline

that reclassification.

D. Special Payment for Certain

Nonteaching, Nondisproportionate

Share Hospitals That Do Not Qualify as

Medicare-Dependent, Small Rural

Hospitals (§ 412.107)

Section 4401(b) of Public Law 105–33

provides a temporary special payment

for FYs 1998 and 1999 for certain

hospitals that do not receive any

additional payment through the IME or

DSH adjustment and do not meet the

criteria to be classified as a Medicaredependent, small rural hospital (MDH).

As set forth in section 4401(b)(2), in

order to qualify for the special payment,

a hospital must be located in a State in

which the aggregate operating

prospective payment for hospitals that

meet the special payment criteria (that

is, non-IME, non-DSH, non-MDH

hospitals) is less than the aggregate

allowable operating costs of inpatient

hospital services (referred to hereafter as

a negative operating prospective

payment margin) for those hospitals for

their cost reporting periods that began

during FY 1995. In addition, a hospital

must have a negative operating

prospective payment margin during the

cost reporting period at issue (beginning

in FY 1998 or 1999).

Under the provisions of section

4401(b)(1), for these hospitals, the

percentage increase otherwise

applicable to the standardized amount

for FY 1998 will be increased by 0.5

percentage points and, for FY 1999, the

applicable percentage increase will be

increased by 0.3 percentage points.

Based on the current law, this means

that these hospitals will receive an

update of 0.5 percent for FY 1998 (the

update for all other hospitals is 0) and,

for FY 1999, an update of the market

basket increase minus 1.6 percentage

points (1.9 for all other hospitals).

Under section 4401(b)(1), in applying

these updates, the increase provided in

FY 1998 will not apply in computing

the update for FY 1999 and neither

update will affect the updates provided

for discharges in fiscal years after FY

1999.

Under section 4401(b)(2) of Public

Law 105–33, in determining whether a

hospital qualifies for the special

payment for a given cost reporting

period, we must look first at statewide

aggregate data for non-IME, non-DSH,

non-MDH hospitals for cost reporting

periods beginning during FY 1995, and

second at hospital-specific

characteristics for the cost reporting

period at issue. With respect to the first

criterion, we used the best data

currently available. We used the latest

update to the provider-specific file to

identify those hospitals that do not

receive IME or DSH payments. We also

identified those hospitals that meet the

criteria to be designated as an MDH.

Using the latest update to the Health

Care Provider Cost Report Information

System (HCRIS), we examined the FY

1995 cost report data for the non-IME,

non-DSH, and non-MDH hospitals

identified above and found that the

following States meet the criteria set

forth in section 4401(b)(2)(B):

Alaska, Connecticut, Delaware,

Hawaii, Illinois, Indiana, Iowa,

Louisiana, Maine, Missouri, New

Hampshire, New Jersey, Ohio, Puerto

Rico, Rhode Island, Vermont,

Wisconsin,

For purposes of determining

qualification for special payment under

section 4401(b), this is the final list of

qualifying States. We recognize that cost

reports for cost reporting periods

beginning during FY 1995 might be

subject to further adjustments, and we

considered the option of waiting until

all FY 1995 cost reports are finally

settled before determining the

qualifying States. We rejected this

approach because under the prospective

payment system, we believe that, to the

extent possible, we must set the

payment parameters that will be applied

to hospitals before the start of the fiscal

year. If we waited several years for all

FY 1995 cost reports to be settled before

making this additional payment to the

qualifying hospitals, hospitals would

have less certainty about the amount of

payments they would receive.

Moreover, the intent of Congress to

provide relief to hospitals in FYs 1998

and 1999 would be compromised. In

addition, for purposes of computing the

FY 1998 and 1999 standardized

amounts and performing the necessary

related calculations (for example, the

budget neutrality adjustments), we need

to make a prospective determination

about which hospitals are likely to be

affected. In short, then, for purposes of

determining the qualifying States under

section 4401(b)(2)(B), we have decided

to use the best data available now.

With respect to hospital-specific

characteristics, however, the statute

requires that we look at data for the cost

reporting period at issue (beginning in

FY 1998 or 1999). That is, we must look

at the cost reporting period at issue and

determine whether the hospital has a

negative operating prospective payment

margin for that period, and whether the

hospital received IME or DSH payments

or qualified as an MDH for that period.

Thus, the final determination as to

whether a hospital is eligible for the

add-on cannot be made until cost report

settlement. We intend to make interim

payment to these hospitals beginning

with discharges occurring on or after

October 1, 1997, based on the latest

information available to the fiscal

intermediaries. That is, if a hospital is

in one of the 17 designated States, is not

receiving IME or DSH payments in FY

1998 or 1999, is not an MDH, and, based

on the latest cost report information

available to the intermediary, has a

negative operating prospective payment

margin, the intermediary will pay the

hospital based on the higher

standardized amount during the fiscal

year. As noted above, the final decision

as to a hospital’s qualification for the

additional payment will be made at cost

report settlement.

We have added a new § 412.107 to the

regulations and revised § 412.90 to

implement this provision. We note that

in the Addendum and Appendix A to

this final rule with comment period, we

refer to the hospitals that qualify for the

higher standardized amount as

‘‘temporary relief’’ hospitals.

E. Payments to Disproportionate Share

Hospitals (§ 412.106)

Effective for discharges beginning on

or after May 1, 1986, hospitals that treat

a disproportionately large number of

low-income patients receive additional

payments through the DSH adjustment.

Section 4403(a) of Public Law 105–33

reduces the payment a hospital would

otherwise receive under the current

disproportionate share formula by 1

percent for FY 1998, 2 percent for FY

1999, 3 percent for FY 2000, 4 percent

for FY 2001, 5 percent for FY 2002, and

0 percent for FY 2003 and each

subsequent fiscal year. Therefore, the

actual payment a hospital receives

under DSH will be reduced by 1 percent

for FY 1998. We are adding a new
46002 Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations

paragraph (e) to § 412.106 to implement

this provision.

In addition, section 4403(b) of Public

Law 105–33 requires the Secretary to

submit to Congress, no later than 1 year

after enactment (that is, by August 5,

1998), a report that contains a formula

for determining the amount of

additional payments to disproportionate

share hospitals. In determining the

formula, the Secretary is required to

establish a single threshold for costs

incurred by hospitals in serving lowincome patients, and consider the

following costs:

(1) the costs incurred for furnishing

hospital services to individuals entitled

to Medicare Part A and SSI; and

(2) the costs incurred for furnishing

services to individuals receiving

Medicaid who are not entitled to

benefits under Part A of Medicare,

including individuals enrolled in a

managed care organization or any other

managed care plan under Medicaid and

individuals who receive medical

assistance in a State with an 1115

waiver under Medicaid. In developing

the formula, the Secretary is given the

authority to require hospitals receiving

DSH payments to submit any

information the Secretary finds

necessary in order to develop the

formula.

F. Payment for Blood Clotting Factor for

Hemophilia Inpatients (§§ 412.2 and

412.115)

Hemophilia is a blood disorder

characterized by prolonged coagulation

time, caused by an inherited deficiency

of a factor in plasma necessary for blood

to clot. For purposes of this final rule

with comment period, hemophilia is

considered to encompass the following

three conditions: Factor VIII deficiency

(classical hemophilia); Factor IX

deficiency (plasma thromboplastin

component); and Von Willebrand’s

disease.

Section 6011 of Public Law 101–239

amended section 1886(a)(4) of the Act to

provide that prospective payment

hospitals receive an additional payment

for the costs of administering blood

clotting factor to Medicare hemophiliacs

who are hospital inpatients. Section

6011(b) specified that the payment is to

be based on a predetermined price per

unit of clotting factor multiplied by the

number of units provided. This add-on

payment originally was effective for

blood clotting factor furnished on or

after June 19, 1990, and before

December 19, 1991. Section 13505 of

Public Law 103–66 amended section

6011(d) of Public Law 101–239 to

extend the period covered by the addon payment for blood clotting factors

administered to Medicare inpatients

with hemophilia through September 30,

1994. Most recently, section 4452 of

Public Law 105–33 amended section

6011(d) of Public Law 101–239 to

reinstate the add-on payment for the

costs of administering blood clotting

factor to Medicare beneficiaries who

have hemophilia and who are hospital

inpatients for discharges occurring on or

after October 1, 1997.

We are calculating the add-on

payment for FY 1998 using the same

methodology we used in the past. That

is, we are establishing a price per unit

of clotting factor based on the current

price listing available from the 1997

Drug Topics Red Book, the publication

of pharmaceutical average wholesale

prices (AWP). We are setting separate

add-on amounts, for the following

clotting factors, as described by HCFA’s

Common Procedure Coding System

(HCPCS). The add-on payment amount

for each HCPCS code is based on the

median AWP of the several products

available in that category of factor,

discounted by 15 percent.

Based on this methodology, the prices

per unit of factor are as follows:

Per unit

J7190 Factor VIII (antihemophilic

factor-human) ................................. $0.76

J7192 Factor VIII (antihemophilic

factor-recombinant) ........................ 1.00

J7194 Factor IX (complex) ................ 0.32

J7196 Other hemophilia clotting factors (e.g., anti-inhibitors) ............... 1.10

These prices will be effective for addon payment for blood clotting factors

administered to inpatients who have

hemophilia for discharges beginning on

or after October 1, 1997 through

September 30, 1998.

As noted above, we are following the

same methodology as we have in

previous years in calculating the FY

1998 add-on payment for the cost of

administering blood clotting factors to

hospital inpatients with hemophilia. In

view of the brief period of time between

the enactment of Public Law 105–33

and the need to reinstitute the add-on

payment for blood clotting factors, we

believe that using this methodology is

the only viable alternative. However, we

understand that hospitals may be able to

obtain blood clotting factors at prices

substantially below the median AWP.

Thus, we believe it is possible that the

methodology for determining add-on

payment amounts could be revised to

better reflect the actual costs of

administering the blood clotting factors.

We intend to examine our methodology

before establishing the add-on payment

amount for FY 1999 and are soliciting

comments on the appropriateness of the

add-on payment amount and

suggestions for the best methodology to

calculate this amount.

We have revised §§ 412.2(f)(8) and

412.115(b) to indicate that for

discharges occurring on or after October

1, 1997, we will make an add-on

payment for the costs of administering

blood clotting factor to Medicare

hospital inpatients who have

hemophilia. We will reissue

instructions to Medicare hospitals and

fiscal intermediaries concerning the

codes to use for clotting factor and how

to use them. We note that payment will

be made for blood clotting factor only if

there is an ICD–9–CM diagnosis code for

hemophilia and the appropriate HCPCS

code included on the bill.

G. Payments to Hospitals in Puerto Rico

(§ 412.204)

Currently, the Puerto Rico payment

rate for operating costs is based on 75

percent of the Puerto Rico-specific

standardized amount and 25 percent of

a national standardized amount. Section

4406 of Public Law 105–33 amended

section 1886(d)(9)(A) of the Act to revise

the Puerto Rico and national shares of

the Puerto Rico payment rate. Beginning

with discharges occurring on or after

October 1, 1997, the Puerto Rico

payment rate will be a blend of 50

percent of the Puerto Rico standardized

amount and 50 percent of a national

standardized amount. We are revising

§ 412.204 of the regulations to conform

with this amendment.

H. Changes to the Indirect Medical

Education Adjustment (§ 412.105)

1. Changes in the June 2, 1997 Proposed

Rule

Section 1886(d)(5)(B) of the Act

provides that prospective payment

hospitals that have residents in an

approved graduate medical education

program receive an additional payment

to reflect the higher indirect operating

costs associated with graduate medical

education. The regulations regarding the

calculation of this additional payment,

known as the IME adjustment, are at

§ 412.105. The additional payment is

based in part on the applicable IME

adjustment factor. The adjustment factor

is calculated by using a hospital’s ratio

of residents-to-beds in the formula set

forth at section 1886(d)(5)(B)(ii) of the

Act.

The criteria governing whether a

program is considered approved are

currently at § 412.105(g)(1)(i). These

criteria are the same as those used to

identify approved programs for the

direct graduate medical education
Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations 46003

payment under § 413.86(b). In the

August 30, 1991 final rule (56 FR

43237), we added a criterion to

§ 413.86(b), but inadvertently did not

add it to § 412.105(g)(1)(i). This criterion

added the Annual Report and Reference

Handbook of the American Board of

Medical Specialties (ABMS) as another

publication to be used to identify

approved programs.

Historically, we have used the same

criteria to determine whether a

residency training program is approved

for payments under both the indirect

and the direct graduate medical

education payments. This has in fact

been our policy with regard to whether

programs listed in the ABMS’ Annual

Report and Reference Handbook are

considered approved for IME

adjustment payments, even though

§ 412.105(g)(1)(i) was not changed. To

avoid any future confusion, we

proposed to revise this section to

parallel the changes made at § 413.86(b).

We received no public comments on

this proposal and are adopting this

change in the final rule with comment

period.

In addition, we proposed to delete

current § 412.105(g)(1)(iv), which

excludes from the IME resident count

any anesthesiology residents employed

to replace anesthetists. This exclusion

was originally intended to prevent

hospitals from hiring residents in lieu of

nonphysician anesthetists. Given that

certain rural hospitals continue to

receive pass-through cost-based

payment for their anesthetist costs, we

no longer believe this provision is

warranted. Nor are we aware of any

specific instances where it has been

applied. We received one public

comment in support of this proposed

revision and no opposing comments.

Therefore, we are implementing this

change in the final rule with comment

period.

2. Changes to IME in Public Law 105–

33

In addition to making the changes set

forth above, we are revising the

regulations to incorporate the provisions

of section 4621 of Public Law 105–33,

which revised section 1886(d)(5)(B) of

the Act in several ways. First, it

gradually reduces the current level of

IME adjustment (approximately a 7.7

percent increase for every 10 percent

increase in the resident-to-bed ratio)

over the next several years. The

schedule for the IME adjustment is as

follows: 7.0 percent for discharges

during FY 1998; 6.5 percent during FY

1999; 6.0 percent during FY 2000; and

5.5 percent during FY 2001 and

thereafter.

Second, section 4621 established

certain limits both on the full-time

equivalent (FTE) number of residents

counted by each hospital and on the

resident-to-bed ratio. Effective for

discharges on or after October 1, 1997,

section 4621(b)(1) added a new section

1886(d)(5)(B)(v) to the Act to provide

that a hospital’s total number of resident

FTEs in the fields of allopathic and

osteopathic medicine may not exceed

the total number of such resident FTEs

in the hospital during its most recent

cost reporting period ending on or

before December 31, 1996. Furthermore,

section 1886(d)(5)(B)(vi)(I), as added by

section 4621(b)(1) of Public Law 105–

33, provides that the ratio of residentsto-beds may not exceed the ratio of

residents-to-beds during the prior cost

reporting period (after accounting for

the cap on the number of resident

FTEs).

Third, for cost reporting periods

beginning on or after October 1, 1997,

and subject to the new limit on counting

residents described above (as well as the

expansion of allowable settings to offsite services, as described below), new

section 1886(d)(5)(B)(vi)(II) provides

that residents will be counted based on

a 3-year rolling average. This policy will

decrease the financial impact of

downsizing residency programs.

Resident counts for cost reporting

periods beginning during FY 1998 will

be based on an average of the number

of residents from the past 2 years, and

for subsequent periods, resident counts

will be based on an average of the past

3 years.

With respect to medical residency

training programs established on or after

January 1, 1995, section

1886(d)(5)(B)(viii) provides that the

Secretary must develop rules to apply

these limits to new programs, giving

special consideration to ‘‘facilities that

meet the needs of underserved areas,’’

and to facilitate the application of

aggregate limits in the case of affiliated

groups (as defined by the Secretary).

The Secretary may require any entity

that operates a medical residency

training program to submit additional

information necessary to carry out the

limits. We have revised the regulations

at § 413.86(g)(6) to comply with these

directions. For a more detailed

explanation of this provision, see

section V.I of the preamble concerning

the direct graduate medical education

payments.

Finally, section 4621(b)(2) amended

section 1886(d)(5)(B)(iv) to allow all the

time spent by a resident in patient care

activities under an approved medical

residency training program at an entity

in a nonhospital setting to be counted

towards the determination of full-time

equivalency if the hospital incurs all, or

substantially all, of the costs for the

training program in the nonhospital

setting. Therefore, we are revising

current § 412.105(g)(1)(ii)(C), which

allowed hospitals to include the time

residents spent in certain community

health centers, to also include

nonhospital settings where residents’

time may be counted for purposes of

IME. The eligibility criteria for this new

provision is similar to a provision

regarding direct graduate medical

education payments at section

1886(h)(4)(E) of the Act, and

implemented at § 413.86(f)(iii). We will

rely upon the same criteria for direct

graduate medical education to identify

eligible situations under this new IME

provision.

In addition to the regulatory changes,

we intend to issue instructions to fiscal

intermediaries to implement these

changes effective October 1, 1997.

We are also revising § 412.105(d) to

reinsert instructions for determining the

education adjustment factors that were

incorrectly deleted in a correction

notice published on January 29, 1996

(61 FR 2725), and deleting current

paragraph (f), which describes the

determination of full-time resident

counts for cost reporting periods

beginning prior to July 1, 1991.

Section 4622 of Public Law 105–33

added a new section 1886(d)(11) to the

Act to provide for IME payments to

teaching hospitals for discharges

associated with Medicare managed care

beneficiaries for portions of cost

reporting periods occurring on or after

January 1, 1998. The additional

payment is equal to an ‘‘applicable

percentage’’ of the estimated average per

discharge amount that would have been

made for that discharge if the

beneficiary were not enrolled in

managed care. The applicable

percentage is set forth in section

1886(h)(3)(D)(ii) of the Act and is equal

to 20 percent in 1998, 40 percent in

1999, 60 percent in 2000, 80 percent in

2001, and 100 percent in 2002 and

subsequent years. We are adding a new

paragraph (g) to § 412.105 to implement

this provision.

I. Direct Graduate Medical Education

(GME)

1. Newly Participating Hospitals

(§ 413.86(e))

Under section 1886(h) of the Act and

implementing regulations, Medicare

pays hospitals for the direct costs of

graduate medical education on the basis

of per resident costs in a 1984 base year.

Under existing regulations at
46004 Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations

§ 413.86(e)(4), if a hospital did not have

residents in the 1984 base period but

later participates in teaching activities,

the fiscal intermediaries calculate a per

resident amount based on a weighted

average of all the hospitals in the same

geographic wage area. There must be at

least three hospitals for this calculation.

If there are fewer than three hospitals,

the regulations require the fiscal

intermediary to contact the HCFA

Central Office for a determination of the

appropriate amount to use.

We proposed to revise the regulations

for determining base year per resident

amounts for hospitals that participated

in residency training after the 1984 base

period. Under the proposed changes to

§ 413.86(e)(4)(i)(B), we sequentially

follow the criteria listed below until we

would base the weighted average

calculation on a minimum of 3 per

resident amounts:

• If there are fewer than three

hospitals in the hospital’s geographic

wage area, we would determine a

weighted average based on the per

resident amounts for all hospitals in the

hospital’s own wage area, plus hospitals

in geographically contiguous wage

areas.

• If there are still fewer than three

hospitals in the hospital’s own wage

area, plus hospitals in contiguous wage

areas, the weighted average would be

based on the per resident amounts for

all hospitals in the State.

• If there are fewer than three

hospitals in the entire State, the

weighted average would be based on the

per resident amounts for all hospitals in

that State plus hospitals in contiguous

States.

• If there are fewer than three

hospitals in that State and contiguous

States, the weighted average per

resident amount would be based on the

national average per resident amount.

Comment: One commenter stated that

our proposed policy appears reasonable

but we have not indicated how the

policy would affect the per resident

amounts for hospitals that previously

had their payment amounts determined

by HCFA Central Office.

Response: The proposed policy

simply reflects the methodology in

effect prior to this final rule with

comment period. As discussed below,

we are revising the methodology in this

final rule with comment period.

However hospitals that previously had a

per resident amount determined by

HCFA Central Office will be unaffected

since policy changes can only be

effective prospectively.

Comment: Two commenters suggested

that the proposed methodology may

negatively affect the expansion of

training sites, particularly in rural areas

where there might not be three hospitals

with established per resident amounts.

One of these commenters suggested that

the hospital with the new training

program be given the option of

establishing a per resident amount

based on its ‘‘cost, not to exceed the

higher of the contiguous area average, or

the national average cost per resident,

perhaps adjusted by the appropriate

wage index.’’ The other commenter

suggested that if there are fewer than

three hospitals, that we use the lower of

the new hospital’s cost per resident or

the national average cost per resident

adjusted by the hospital wage index.

The commenter suggested that this

approach would be consistent with

HCFA initiatives to move from

historical local or regional cost based

payments to national averages. Another

benefit of this approach according to

this commenter is that it is simple and

would overwhelmingly benefit rural

hospitals.

Response: The per resident amounts

vary widely among hospitals

nationwide. Given this wide variation,

we believe it is difficult to know

whether a hospital establishing a new

program in any given geographic area

will receive a high or low per resident

amount using our proposed

methodology. Although the first

commenter’s suggested alternative is

similar to the proposed policy, it

guarantees a per resident amount for the

new hospital that is either equal to or

higher than the per resident amount

under the proposed methodology if the

hospital’s own costs exceed the

contiguous area average or the national

average per resident amount. We find

merit in the latter commenter’s

suggested alternative of using the lower

of the hospital’s own costs or a national

average per resident amount. It has the

advantage of being simple and equally

as likely to produce an equitable rate as

our proposed methodology. We support

using the commenter’s proposed

methodology with a modification.

Thus, effective October 1, 1997 the

per resident amount for new teaching

hospitals is based on the lower of the

hospital’s actual per resident costs or:

• The weighted average of the per

resident amounts for hospitals located

in the same geographic area as that term

is used in the prospective payment

system under 42 CFR part 412.

• Where there are fewer than three

hospitals in a geographic wage area, we

will use regional weighted average per

resident amounts determined for each of

the nine census regions established by

the Bureau of Census for statistical and

reporting purposes.

2. New Legislative Changes to Direct

Graduate Medical Education (Direct

GME)

a. Limit on the Count of Residents

(§ 413.86(g))

Section 4623 of Public Law 105–33

adds section 1886(h)(4)(F) of the Act to

establish a limit on the number of

allopathic and osteopathic residents that

a hospital can include in its full time

equivalent (FTE) count for Direct GME

payment. Residents in dentistry and

podiatry are exempt from the cap. For

cost reporting periods beginning on or

after October 1, 1997, a hospital’s

unweighted direct medical education

FTE count may not exceed the hospital’s

unweighted FTE count for its most

recent cost reporting period ending on

or before December 31, 1996.

Currently, hospitals report their

weighted but not their unweighted FTE

count on their Medicare cost report.

New section 1886(h)(4)(H)(iii) of the Act

gives the Secretary authority to collect

whatever data are necessary to

implement this provision. Hospitals

have been required to report residentspecific information to their fiscal

intermediaries under longstanding

requirements of § 413.86, and we

believe it is possible to implement

section 1886(h)(4)(F) without mandating

significant additional reporting. Since

the unweighted direct GME FTE count

will be used in calculating direct GME

payments, we expect to amend the

Medicare cost report to require hospitals

to report the unweighted FTE direct

GME count for future cost reporting

periods. A separate data collection effort

will be required to obtain the

information for the most recent cost

reporting periods ending on or before

December 31, 1996.

We believe the hospital’s unweighted

FTE limit for its most recent cost

reporting period ending on or before

December 31, 1996 should be based on

a 12 month cost reporting period. If the

hospital’s most recent cost reporting

period ending on or before December

31, 1996, is a short period report, the

fiscal intermediaries shall make

adjustments so that the hospital’s

unweighted FTE limit corresponds to

the equivalent of a 12 month cost

reporting period. We are revising

§ 413.86(g)(4) accordingly.

(1) Counting Residents Based on a 3–

Year Average (§ 413.86(g)(5))

Section 1886(h)(4)(G)(iii) of the Act,

as added by section 4623 of Public Law

105–33, provides that for the hospital’s

first cost reporting period beginning on

or after October 1, 1997, the hospital’s

weighted FTE count for payment
Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations 46005

purposes equals the average of the

weighted FTE count for that cost

reporting period and the preceding cost

reporting period. For cost reporting

periods beginning on or after October 1,

1998, section 1886(h)(4)(G) of the Act

requires that hospitals’ direct medical

education weighted FTE count for

payment purposes equal the average of

the actual weighted FTE count for the

payment year cost reporting period and

the preceding 2 cost reporting periods.

This provision provides incentives for

hospitals to reduce the number of

residents in training by phasing in the

associated reduction in payment over a

3-year period. We are revising

§ 413.86(g)(5) accordingly.

For cost reporting periods beginning

on or after October 1, 1997, we will

determine the hospital’s direct GME

payment as follows:

Step one. Determine the average of the

weighted FTE counts for the payment

year cost reporting period and the prior

two immediately preceding cost

reporting periods (with exception of the

hospital’s first cost reporting period

beginning on or after October 1, 1997,

which will be based on the average of

the weighted average for that cost

reporting period and the immediately

preceding cost reporting period).

Step two. Determine the hospital’s

allowable direct GME costs without

regard to the FTE cap (before

determining Medicare’s share). That is,

take the sum of (a) the product of the

primary care per resident amount and

the primary care weighted FTE count,

and (b) the product of the non-primary

care per resident amount and the nonprimary care weighted FTE count.

Step three. Divide the hospital’s

allowable direct GME costs by the total

number of FTE residents (including the

effect of weighting factors) for the cost

reporting period to determine the

average per resident payment amount

(this amount reflects the FTE weighted

average of the primary and non-primary

care per resident amounts) for the cost

reporting period.

Step four. Multiply the average per

resident payment amount for the cost

reporting period by the 3 year average

weighted count to determine the

hospital’s allowable direct GME costs.

This product is then multiplied by the

hospital’s Medicare patient load for the

cost reporting period to determine

Medicare’s direct GME payment to the

hospital.

The following example illustrates

determination of direct GME payment

under the rolling average methodology:

Assume a hospital with a cost

reporting period ending December 31,

1996 (beginning January 1, 1996) had

100 unweighted FTE residents and 90

weighted FTE residents. The hospital’s

FTE cap is 100 unweighted residents.

Step one. In its cost reporting period

beginning January 1, 1997, it had 100

unweighted residents and 90 weighted

residents.

• The hospital had 90 unweighted

residents and 85 weighted residents for

its cost reporting period beginning

January 1, 1998.

• In its cost reporting period

beginning on January 1, 1999, the

hospital had 80 unweighted residents

and 80 weighted residents.

• The 3 year weighted average for the

hospital’s cost reporting period

beginning January 1, 1999 is 85

(90+85+80)/3).

Step two. Payment for the cost

reporting period is determined by

multiplying hypothetical per resident

amounts for primary care and nonprimary care residents as follows:

• Primary Care—$50,000×70

weighted FTEs=$3,500,000

• Other—$47,000×10 weighted

FTEs=$470,000

• Total direct GME payments before

using the 3-year average FTE counts and

applying the Medicare patient load

would be $3,970,000 ($3,500,000 +

$470,000).

Step three. Divide $3,970,000 by 80

total FTEs (70+10) to determine an

average per resident FTE payment of

$49,625.

Step four. Multiply this figure by 85

FTEs (from step 1 above) to determine

a total payment $4,218,125. Apply the

hospital’s Medicare patient load to

determine Medicare’s direct GME

payment.

To address situations in which a

hospital increases the number of FTE

residents over the cap, notwithstanding

the limit established under section

1886(h)(4)(F), we are establishing the

following policy for determining the

hospital’s weighted direct GME FTE

count for cost reporting periods

beginning on or after October 1, 1997.

• Determine the ratio of the hospital’s

unweighted FTE count for residents in

those specialties for the most recent cost

reporting period ending on or before

December 31, 1996, to the hospital’s

number of FTE residents without

application of the cap for the cost

reporting period at issue.

• Multiply the ratio determined above

by the weighted FTE count for those

residents for the cost reporting period.

Add the weighted count of residents in

dentistry and podiatry to determine the

weighted FTEs for the cost reporting

period. This methodology should be

used for purposes of determining

payment for cost reporting periods

beginning on or after October 1, 1997.

The hospital’s unweighted count of

interns and residents for a cost reporting

period beginning before October 1, 1997

will not be subject to the FTE limit.

For example, if the hospital’s FTE

count of residents in its cost reporting

period ending December 31, 1996 is 100

residents before application of the

initial residency weighting factors and

the hospital’s number of residents for its

December 31, 1990 cost reporting period

is 110 FTE residents, the ratio of

residents in the two cost reporting

periods equals 100/110. If the hospital’s

weighted FTE count is 100 FTE

residents in the December 31, 1998 cost

reporting period (that is, of the 110

unweighted residents, 20 are beyond the

initial residency period and are

weighted as 0.5 FTE), the hospital’s

weighted FTE count for determining

direct GME payment is equal to (100/

110) * 100, or 90.9 FTE residents.

If a hospital’s unweighted count of

residents in specialties other than

dentistry and podiatry does not exceed

the limit, the weighted FTE count

equals the actual weighted FTE count

for the cost reporting period. The

weighted FTE count in either instance

will be used to determine a hospital’s

payment under the 3 year rolling

average payment rules. We believe this

proportional reduction in the hospital’s

unweighted FTE count is an equitable

mechanism for implementing the

statutory provision.

Section 1886(h)(4)(G)(ii) of the Act

provides that the Secretary makes

appropriate modifications to ensure that

the average FTE resident counts are

based on the equivalent of full 12 month

cost reporting periods. We are revising

§ 413.86(g)(5) to allow the fiscal

intermediaries to make the appropriate

adjustments to ensure that 3 year and 2

year average FTE counts are based on

the equivalent of 12 month periods.

(2) Exceptions to the Direct GME FTE

Limit (§ 413.86(g)(6))

Under new section 1886(h)(4)(H)(i) of

the Act, the Secretary is required,

consistent with the principles of

establishing a limitation on the number

of residents paid for by Medicare and

the 3-year rolling average, to establish

rules with respect to the counting of

residents medical residency training

programs established on or after January

1, 1995. Such rules must give special

consideration to facilities that meet the

needs of underserved rural areas.

Language in the Conference Report

indicates concern that there be proper

flexibility to respond to changing needs

given the sizeable number of hospitals
46006 Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations

that elect to initiate new (or terminate

existing) training programs.

Pursuant to the statute, we are

establishing the following rules for

applying the FTE limit and determining

the FTE count for hospitals that

established new medical residency

training programs on or after January 1,

1995. For purposes of this provision, a

‘‘program’’ will be considered newly

established if it is accredited for the first

time, including provisional

accreditation on or after January 1, 1995,

by the appropriate accrediting body.

Although the Secretary has broad

authority to prescribe rules for counting

residents in new programs, the

Conference Report for Public Law 105–

33 indicates concern that aggregate

number of FTE residents should not

increase over current levels.

Accordingly, we will continue to

monitor growth in the aggregate number

of residency positions and may consider

changes to the policies described below

if there continues to be growth in the

number of residency positions. We are

providing for adjustments in the

following situations:

(i) Hospitals with no Residents prior

to January 1, 1995.

If a hospital had no residents before

January 1, 1995 and it establishes one or

more new medical residency training

programs on or after that date, the

hospital’s FTE cap will be based on the

number of first year residents

participating in its accredited graduate

medical education training programs in

the third year of receiving payments for

direct GME. The hospital’s unweighted

FTE resident cap will equal the product

of the number of first year residents in

that year and the number of years in

which residents are expected to

complete that program based on the

minimum accredited length for the type

of program as published in the Graduate

Medical Education Directory.

For example, assume a hospital that

did not receive any direct GME payment

in its cost reporting period ending

December 31, 1994 (the hospital’s most

recent cost reporting period ending

before January 1, 1995) established an

internal medicine program and receives

direct GME payment for residents

beginning a training program on July 1,

1998. The hospital’s cap would be

adjusted to reflect the resident cap for

residents in the internal medicine

program for its cost reporting periods

ending in 1998 and 1999. In the

hospital’s cost reporting period ending

December 31, 2000 (the third cost

reporting period in which the hospital

has residents), there are five first-year

FTE residents participating in the

hospital’s internal medicine program.

Since the minimum length listed for

internal medicine programs in the

Graduate Medical Education Directory

is 3 years, this hospital’s unweighted

FTE cap can subsequently be adjusted

by up to 15 FTEs.

(ii) Hospitals with Residents prior to

January 1, 1995, not Located in Rural

Areas

If a hospital is not located in a rural

area and had residents in its most recent

cost reporting period ending before

January 1, 1995, the hospital’s

unweighted FTE cap may be adjusted

for new medical residency training

programs established on or after January

1, 1995 but before August 5, 1997. An

adjustment under this policy allows

programs which began between January

1, 1995 and enactment of the statute to

grow to full capacity. No adjustments to

the FTE cap will be allowed for new

medical residency training programs

established on or after August 5, 1997.

An adjustment in the hospital’s FTE

limit for a new program will be based

on the product of the number of first

year residents in the third year of the

newly established program and the

minimum accredited length for the type

of program published in the Graduate

Medical Education Directory. The

hospital’s revised unweighted FTE limit

reflects the number of residents in its

most recent cost reporting period ending

on or before December 31, 1996 adjusted

for the incremental increase in its FTE

count for newly established programs.

We are providing the following

example to illustrate how to make

adjustments to the FTE cap for newly

established medical residency training

programs in hospitals that received

direct GME payments prior to January 1,

1995. Assume a hospital had an

unweighted direct GME count of 100

FTE residents for its cost reporting

period ending June 30, 1996 and the

hospital, although it had 6 first year

positions, began an internal medicine

program on July 1, 1995 with only 4 first

year residents. On July 1, 1996, the

program expands to 10 residents (six

first-year residents and four second-year

residents). On July 1, 1997, the program

has 16 residents (six first-year residents,

six second-year residents and four thirdyear residents). Since the minimum

accredited length for allopathic internal

medicine programs listed in the

Graduate Medical Education Directory

is 3 years, the hospital’s unweighted

FTE cap can subsequently be adjusted to

reflect 18 residents in the internal

medicine program (six first-year

residents × 3 years). In the hospital’s

cost reporting period ending June 30,

1996 (the initial cap year), the hospital

had a total of 100 FTE residents

including 4 in internal medicine. Thus,

the hospital’s adjusted cap equals 100

residents plus 14 (18–4) or 114

residents.

(iii) Hospitals Located in Rural Areas

that had Residents before January 1,

1995 and Other Rural Hospitals that

Added Residents Under (i) of this

Section.

We would treat these rural hospitals

the same as all other hospitals which

had residents before January 1, 1995

with the exception that the unweighted

FTE limit for these hospitals could be

adjusted to reflect residents in new

medical residency training programs

established on or after August 5, 1997.

That is, if these hospitals added new

programs on or after August 5, 1997 the

cap would be adjusted but not without

limit. A hospital’s unweighted limit

would be adjusted for each new

program based on the methodology

described above based on the product of

the number of first year residents in the

third year of the newly established

program and the minimum number of

years of the accredited program. For

these hospitals, the limit will only be

adjusted for additional new programs

but not for expansions of existing or

previously existing programs.

A hospital seeking an adjustment to

the unweighted direct GME FTE

resident count limit under this

exception policy must provide

documentation to its fiscal intermediary

justifying the adjustment.

(3) Aggregate Direct GME FTE Limit for

Affiliated Institutions (§ 413.86(g)(4))

Section 1886(h)(4)(H)(ii) of the Act

permits but does not require the

Secretary to prescribe rules that allow

institutions that are members of the

same affiliated group (as defined by the

Secretary) to elect to apply the FTE

resident limit on an aggregate basis.

This provision would permit hospitals

flexibility in structuring rotations

within a combined cap when they share

residents.

Pursuant to the broad authority

conferred by the statute, we are

establishing the following criteria to

define ‘‘affiliated group’’.

• Hospitals in the same geographic

wage area. For purposes of this

provision, ‘‘affiliated group’’ includes

two or more hospitals located in the

same geographic wage area (as that term

is used for purposes of the inpatient

operating prospective payment system),

if the hospital rotate residents to the

other hospitals of the group during the

course of the approved program.

• Hospitals that are not located in the

same geographic wage area. If the

hospitals are not located in the same
Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations 46007

geographic wage area, we will consider

them part of the same affiliated group if

the hospitals are jointly listed in

common as a major participating

institution (as that term is used in the

Graduate Medical Education Directory,

1997–1998) for one or more programs.

We are defining an affiliated group on

an institution-wide basis. Hospitals may

participate in many different specialty

programs and may share residents for

one specialty program with one hospital

but share residents for a different

program with another hospital. We

recognize that hospitals may affiliate for

the purpose of specific specialty

programs, but for purposes of applying

an aggregate cap, it is not

administratively feasible to apply the

cap on a program by program basis.

We are implementing all of the above

provisions of section 1886(h)(4) of the

Act effective with cost reporting periods

beginning on or after October 1, 1997.

The statute does not provide a specific

effective date for the rules related to

affiliated groups aggregating resident

FTE counts. Because each of the special

rules is operative in conjunction with

FTE limit, we believe it is appropriate

to implement these provisions on

October 1, 1997. We welcome public

comments on implementation of the

provisions of Public Law 105–33

relating to direct GME payments.

b. Payments to Hospitals for Direct Costs

of Graduate Medical Education of

Medicare Managed Care Beneficiaries

(§ 413.86(d)(2))

Section 4624 of Public Law 105–33

amended section 1886(h)(3) of the Act

to provide a 5-year phase-in of

payments to teaching hospitals for

graduate medical education associated

with services to Medicare managed care

discharges for portions of cost reporting

periods occurring on or after January 1,

1998. The amount of payment is equal

to the product of the per resident

amount, the total weighted number of

FTE residents working all areas of the

hospital (and nonhospital setting in

certain circumstances) subject to the

limit on number of FTE residents under

section 1886(h)(4)(F) and the averaging

rules under section 1886(h)(4)(G) of the

Act described above, the ratio of the

total number of inpatient bed days that

are attributable to Medicare managed

care enrollees to total inpatient days and

the applicable percentage. The

applicable percentages are 20 percent in

1998, 40 percent in 1999, 60 percent in

2000, 80 percent in 2001, and 100

percent in 2002 and subsequent years.

We are revising § 413.86(d)(2) to

establish a 5-year phase-in payment

methodology to hospitals for direct GME

payments based on Medicare managed

care enrollees for portions of cost

reporting periods beginning on or after

January 1, 1998. We will modify the

Medicare cost report to determine direct

GME payments associated with services

to Medicare managed care enrollees.

Section 4001 of Public Law 105–33

adds section 1853(a)(3)(C) of the Act.

New section 1853(a)(3)(C) requires the

Secretary to implement a risk

adjustment methodology that accounts

for variations in per capita costs based

on health status and other demographic

factors in Medicare payments to

managed care organizations by no later

than January 1, 2000. Public Law 105–

33 also adds section 1853(a)(3)(B) of the

Act to require the Secretary to collect

data necessary from managed care

organizations to implement this

provision. We are currently considering

the data requirements necessary to

implement both the direct and indirect

medical education and risk adjustment

provisions. We plan to consult with

organizations representing hospitals and

managed care plans to develop an

administrative mechanism for

implementing both of these provisions.

c. Permitting Payment to Nonhospital

Providers

Under section 4625 of Public Law

105–33, for cost reporting periods

beginning on or after October 1, 1997,

the Secretary is authorized but not

required to establish rules for payment

to ‘‘qualified nonhospital providers’’ for

the direct costs of medical education

incurred in the operation of an

approved medical residency training

program. Under the statute, qualified

nonhospital providers include Federally

Qualified Health Centers, Rural Health

Clinics, Medicare + Choice

organizations and such other

nonhospital providers the Secretary

determines to be appropriate. We expect

to establish rules that specify the

amounts, form, and manner in which

payments will be made and the portion

of such payments that will be made

from each of the Medicare trust funds.

The Secretary must reduce the aggregate

amount paid to nonhospital providers to

the extent payment is made for residents

included in the hospital’s FTE count.

Since we have not previously made

payments for direct graduate medical

education to nonhospital providers, we

are interested in receiving comment on

how to implement this provision. We

are particularly concerned that any

methodology assure that Medicare does

not pay two entities for the same

training time.

In particular, we are interested in

receiving public comments on how to

determine appropriate payment for

ambulatory sites. Under 42 CFR part 405

subpart E, federally qualified health

centers and rural health clinics are paid

on the basis of an all inclusive rate for

each beneficiary visit for the covered

services. We are interested in receiving

public comments on whether we should

pay these entities for GME on a cost

basis, a per resident amount, or some

other basis and how to determine

Medicare’s share of their costs.

Similarly, since we have not previously

made explicit payments to managed

care plans for direct GME we are

interested in how we should pay them.

Section 413.86(f)(1) allows hospitals

to include resident time in nonhospital

sites when the hospital incurs all or

substantially all of the costs. Under

§ 413.86(f)(1)(iii)(B) we have defined

‘‘all or substantially all’’ to mean that

the hospital has a written agreement

with the nonhospital site that it will

continue to pay the resident’s salary for

training time in that setting. We are

interested in receiving comments on

whether this is an appropriate standard

for determining which institution

should be paid for the resident’s

training time or whether there are other

financial arrangements we should

consider in determining which entity

incurs ‘‘all or substantially all’’ of the

costs.

d. Medicare Special Reimbursement

Rule for Primary Care Combined

Residency Programs (§ 413.86(g)(1))

Section 413.86(g)(2) requires full

payment for residents within an initial

residency period. Section 413.86(g)(3)

requires residents beyond the initial

residency period to be weighted as 0.5

FTE for purposes of determining GME

payment. The initial residency period is

defined as the minimum number of

years required to become board eligible

in specialty and is determined at the

time a resident enters a medical

residency training program. In the

August 30, 1996 final rule (61 FR

46211), we clarified that the initial

residency period for residents in

combined medical residency training

programs is limited to the time required

to complete the longer of the composite

programs.

Effective for residents in or beginning

training on or after July 1, 1997, section

4627 of Public Law 105–33 amends

section 1886(h)(5)(G) of the Act to

require that the initial residency period

for combined programs consisting only

of primary care training, equals the

longer of the composite programs plus

one year. A primary care resident is a

resident enrolled in an approved

medical residency training program in
46008 Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations

family medicine, general internal

medicine, general pediatrics, preventive

medicine, geriatric medicine, or

osteopathic general practice. This

provision also adds one year to the

initial residency period for combined

primary care and obstetrics and

gynecology programs. We are amending

§ 413.86(g)(1) to implement the

provisions of section 1886(h)(5)(G) for

residents in or beginning training on or

after July 1, 1997.

J. Medicare Rural Hospital Flexibility

Program

1. Previous Law—EACH/RPCH Program

Section 1820 of the Act, before the

enactment of the Public Law 105–33 of

1997, established the Essential Access

Community Hospital (EACH) program.

Under that program, seven States

received grants to develop rural health

networks consisting of Rural Primary

Care Hospitals (RPCHs) and EACHs.

RPCHs are limited-service rural

hospitals that provide outpatient and

short-term inpatient hospital care on an

urgent or emergency basis. They then

release patients or transfer them to an

EACH or other acute care hospital. To

be designated as RPCHs, hospitals had

to meet certain criteria, including

requirements that they not have more

than 6 inpatient beds for acute (hospitallevel) care and maintain an average

inpatient length of stay of no more than

72 hours.

Montana also has a separate, limitedservice hospital program called the

Medical Assistance Facility (MAF)

program, which has been in operation

since 1988. This program operates

under a demonstration waiver from

HCFA that allows these limited service

hospitals to be reimbursed for providing

treatment to Medicare beneficiaries even

though they are not required to meet all

requirements applicable to hospitals. In

addition, HCFA supplies grant funding

to the Montana Hospital Research and

Education Foundation to provide

technical assistance, liaison, public

education, and other services to the

MAFs. The first MAF was licensed and

began participating in the

demonstration in 1990. At this point a

total of 12 MAFs have been licensed and

certified. Additional facilities are in the

process of considering a conversion to

MAF status.

2. Changes Made by Balanced Budget

Act of 1997

The new legislation replaces the

current 7-State EACH/RPCH program

with a new Medicare Rural Hospital

Flexibility Program that will be

available in any State that chooses to set

up such a program and provide HCFA

with the necessary assurances that it has

developed, or is in the process of

developing, a State rural health care

plan meeting certain requirements, and

that it has designated, or is in the

process of designating, rural nonprofit

hospitals or facilities as critical access

hospitals (CAH).

To be eligible as a CAH, a facility

must be a rural public or nonprofit

hospital located in a State that has

established a Medicare rural hospital

flexibility program, and must be located

more than a 35-mile drive from any

other hospital or critical access hospital.

In mountainous terrain or in areas with

only secondary roads available, the

mileage criterion is 15 miles. In

addition, the facility must make

available 24-hour emergency care

services, provide not more than 15 beds

for acute (hospital-level) inpatient care,

and keep each inpatient for no longer

than 96 hours, unless a longer period is

required because of inclement weather

or other emergency conditions, or a PRO

or other equivalent entity, on request,

waives the 96-hour restriction. An

exception to the 15-bed requirement is

made for swing-bed facilities, which are

allowed to have up to 25 inpatient beds

that can be used interchangeably for

acute or SNF-level care, provided that

not more than 15 beds are used at any

one time for acute care. The facility is

also required to meet certain staffing

and other requirements that closely

parallel the requirements for RPCHs.

The new legislation also defines a

rural health network as an organization

consisting of at least one CAH and at

least one acute care hospital, the

members of which have entered into

agreements regarding patient referral

and transfer, the development and use

of communications systems, and the

provision of emergency and

nonemergency transportation. In

addition, each CAH in a network must

have an agreement for credentialing and

quality assurance with at least one

hospital that is a member of the

network, or with a PRO or equivalent

entity, or with another appropriate and

qualified entity identified in the rural

health care plan for the State.

3. Grandfathering of Existing Facilities

Under the new legislation, no new

EACH designations would be made, but

rural hospitals designated as EACHs

under previous law would continue to

be paid as sole community hospitals.

The previous payment provisions

applicable to RPCHs are repealed, and

the law instead provides that CAHs will

be paid on a reasonable cost basis for

their inpatient and outpatient services.

The law specifically provides that

existing RPCHs and MAFs will be

deemed as CAHs if these facilities or

hospitals are otherwise eligible to be

designated by the State as CAHs. Under

a special provision applicable to the

MAF program, the MAF demonstration

project is extended until at least October

1, 1998, to allow for an appropriate

transition between the MAF and CAH

programs.

4. Provision of SNF-Level Care in

RPCHs

Previous law provided specific rules

relating to the number of beds that an

RPCH could use to provide SNF-level

care. As noted above, the new

legislation provides considerable

flexibility to a CAH with a swing-bed

agreement to use inpatient beds for

either SNF or acute care, as long as the

total number of inpatient beds does not

exceed 25 and the number of beds used

at any one time for acute care does not

exceed 15.

5. Implementing Regulations

To allow the changes made by the

enactment of Public Law 105–33 to be

implemented by the statutory effective

date of October 1, 1997, we are

publishing the interim rules set forth

below. In developing these rules, our

general approach has been to retain the

provisions of existing RPCH regulations,

except where the new legislation clearly

requires us to make a change. We

believe this approach will allow the

new amendments to be implemented

with a minimum of inconvenience for

existing facilities and will serve as the

basis for a smooth transition between

the RPCH and CAH programs.

To implement the section 4201

amendments, we are revising existing

regulations as follows:

• Part 409 (Hospital Insurance

Benefits), § 409.30(a) is revised to

specify that to qualify for posthospital

SNF care in a hospital or CAH, a

beneficiary must have received

inpatient CAH care for at least 3

consecutive calendar days (rather than

the 72 hours required previously for

RPCHs). This change ensures that care

in CAHs and in acute care hospitals is

counted uniformly toward the prior stay

requirement.

• Part 410 (Supplementary Insurance

Benefits), § 410.2 is revised to add a

‘‘CAH’’ in the definitions of both

‘‘Participating’’ providers and

‘‘nonparticipating’’ providers. Also,

§ 410.152(k) is revised to delete the

description of payment methods for

RPCH outpatient services that were

mandated under previous law and to

reflect the new statutory provision. As
Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations 46009

explained more fully below, the statute

now provides that payment for these

services is to be made on a reasonable

cost basis. We are specifying that

‘‘reasonable cost’’ is to be determined

under section 1861(v)(1)(A) of the Act

and existing regulations in Parts 413

and 415. Then, § 410.155(a) is revised to

add a critical access hospital (CAH) that

meets the requirements of part 485 in

the definition of ‘‘Hospital’’.

Furthermore, paragraph (b) is revised to

add a CAH as a provider in which

inpatient mental health services that are

identified in paragraphs (b) (1) through

(4) are not subject to mental health

services limitations described in

paragraph (b).

• Part 412 (Prospective Payment

Systems for Inpatient Hospital Services)

§ 412.109 is revised to reflect the

elimination of the EACH designation.

However, we are retaining the

provisions in current regulations that

are needed to allow rural hospitals

designated as EACHs under previous

law to continue to be paid as sole

community hospitals and, where

appropriate, to obtain adjustments to

their hospital-specific rates. We are

revising the regulations to clarify that

HCFA will terminate the EACH

designation of a hospital that no longer

complies with the terms, conditions,

and limitations that were applicable

when it was designated as an EACH.

• Part 413 (Principles of Reasonable

Cost Reimbursement; Payment for EndStage Renal Disease Services; Optional

Prospectively Determined Payment

Rates for Skilled Nursing Facilities),

§§ 413.1(a)(1)(G), 413.13(c)(2)(iv), and

413.70 are revised to reflect the

elimination of the previously applicable

payment methods for RPCHs. As noted

above, the provisions of the Medicare

law applicable to payment for both

inpatient and outpatient RPCH services

(sections 1814(l) and section 1834(g) of

the Act, respectively) were amended by

sections 4201 (c)(3)(B) and (c)(5) of

Public Law 105–33 to remove the

previous payment provisions, including

the provisions of section 1834(g)(1)(B),

and require that payment to CAHs for

these services be made on a reasonable

cost basis. Reasonable cost is defined at

section 1861(v)(1)(A) of the Act and in

regulations. We have specified that

‘‘reasonable cost’’ is to be determined

under section 1861(v)(1)(A) of the Act

and existing Medicare reimbursement

regulations at 42 CFR parts 413 and 415

and in the statute.

• Part 485, Subpart F (previously

Conditions of Participation for Rural

Primary Care Hospitals) is revised to

reflect the new CAH statutory

requirements regarding the definition of

a rural health network, status and

location requirements, designation

requirements for CAHs, the

requirements regarding the content of

network agreements, number of beds

and length of stay permitted, and the

special requirements for CAHs that

provide SNF-level services.

We recognize that some facilities

which received approval from HCFA

under previous law to provide SNFlevel services, may wish to continue

operating under the terms of that

approval. To authorize this, the

regulations will allow a CAH that

participated in the Medicare program as

a rural primary care hospital (RPCH) on

September 30, 1997 and, on that date,

had in effect an approval from HCFA to

use its inpatient facilities to provide

posthospital SNF care, to continue in

that status under the same terms,

conditions, and limitations that were

applicable at the time those approvals

were granted.

However, a CAH that was granted

swing-bed approval under previous law

may request by January 1, 1998 that

HCFA evaluate its application to be a

CAH and a swing-bed provider under

the current law and the regulations set

forth below. If this request is approved,

the approval is effective not earlier than

October 1997. As of the date of

approval, the CAH no longer has any

status based on its previous approval

and may not request reinstatement

under previously effective provisions.

We are also making nomenclature

changes in various sections of Parts 400,

409, 410, 411, 413, 414, 424, 440, 485,

488, 489, and 498 to reflect the statutory

change from RPCHs to CAHs.

6. Other Implementation Issues

a. Process for Review and Acceptance of

State Assurances

States interested in establishing a

Medicare rural hospital flexibility

program will submit to the Regional

Administrator of the HCFA Regional

Office responsible for oversight of

Medicare and Medicaid in the State, an

application signed by an official of the

State. The application will express the

State’s interest in establishing a

Medicare rural hospital flexibility

program and will contain, at a

minimum, the following assurances and

other information:

The State must provide assurances

that—

(1) The State has developed, or is in

the process of developing, a State rural

health care plan that provides for the

creation of one or more rural health

networks as defined in § 485.603(a),

promotes regionalization of rural health

services in the State, and improves

access to hospitals and other health

services for rural residents of the State;

(2) The State has developed a rural

health care plan in consultation with

the hospital association of the State,

rural hospitals located in the State, and

the State Office of Rural Health (or, in

the case of a State in the process of

developing such a plan, that assures the

Secretary that the State will consult

with these organizations); and

(3) The State has designated or is in

the process of designating (consistent

with the rural health plan), rural

nonprofit or public hospitals or facilities

located in the State as critical access

hospitals; and

The State must also provide other

information to support its assurances, as

follows:

(1) A copy of the State rural health

care plan. If the State is in the process

of developing the plan, the State should

submit a copy of the current draft of the

plan along with an anticipated

completion date;

(2) An explanation of how the State

rural health plan will provide for the

creation of one or more rural health

networks, promote regionalization of

rural health services, and improve

access to hospitals and other health

services for rural residents of the State;

and

(3) a listing of the facilities which the

State has designated, or plans to

designate, as critical access hospitals.

Section 1820(b)(3) of the Act

authorizes HCFA to require other

information and assurances in support

of a State rural health plan. Therefore,

HCFA will send the State a written

request for any other information it may

need to complete review of the

application to establish a Medicare

Rural Hospital Flexibility Program.

HCFA will review the application from

the State for the assurances listed above

and will notify the State in writing of its

decision on the State’s application.

Facilities designated under an approved

plan will be eligible for certification by

the HCFA Regional Office as CAHs, in

accordance with the regulations in 42

CFR Part 485, Subpart F.

We welcome comments on whether

the information and assurances set forth

above are sufficient, or whether other

information or assurances are needed.

We will consider this issue carefully

and notify States in writing of any

changes in the information or

assurances required.

b. Designation of Facilities in Border

States

Section 1820(k), as in effect prior to

the enactment of the Public Law 105–
46010 Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations

33, explicitly authorized States with

EACH programs to designate facilities in

adjacent States as EACHs or RPCHs if

certain conditions were met. Section

4201 of Public Law 105–33 deleted that

authority. Therefore, a facility can be

designated as a CAH only by a State in

which it is located. The regulations as

revised at § 485.606 have deleted any

reference to this authority.

c. Designation of Closed Facilities

Section 1820(f)(1)(B), as in effect prior

to the enactment of Public Law 105–33,

explicitly allowed, under certain

circumstances, States with EACH

programs to designate facilities as

RPCHs even though the facilities had

closed and were not longer functioning

as hospitals at the time they applied for

RPCH status. The new legislation

removed that authority so there is now

no basis on which a closed facility can

be designated as a CAH. We have

revised § 485.612 to reflect this change.

K. Changes to the Update Factors for

Federal Rates for Inpatient Operating

Costs (§ 412.63)

Public Law 105–33 made several

revisions to the applicable percentage

change (the update factor) to the Federal

rates for prospective payment hospitals.

Section 4401(a)(1) of Public Law 105–33

amended section 1886(b)(3)(B)(i) of the

Act to revise the update factors for the

Federal rates for inpatient operating

costs for FYs 1998 through 2002. The

update factor for FY 1998 is now 0

percent for hospitals in all areas. For FY

1999, the update for hospitals in all

areas is the market basket rate of

increase minus 1.9 percentage points.

(As discussed in detail in section V.D.

of this final rule with comment period,

section 4401(b) provides for a higher

update in FY 1998 and FY 1999 for

certain hospitals that do not receive

disproportionate share or indirect

medical education payments and are not

designated as Medicare-dependent,

small rural hospitals.) For FY 2000, the

update for all areas is the market basket

rate of increase minus 1.8 percentage

points. For FY 2001 and FY 2002, the

update for all areas is the market basket

rate of increase minus 1.1 percentage

points. For FY 2003 and subsequent

years, the update for all areas is the

market basket rate of increase. The

specific updates to be applied for FY

1998 are discussed in the addendum

and Appendix D to this document.

In this final rule with comment

period, we are making the necessary

changes to § 412.63 to implement these

provisions.

L. Change in the Publication Date of the

Proposed and Final Rules for the

Hospital Inpatient Prospective Payment

System (§ 412.8)

Section 4644(b) of Public Law 105–33

amends section 1886(e) of the Act to

require the Secretary to publish the

proposed and final rules that contain

her proposed and final

recommendations on the annual update

factor applicable to the hospital

payment rates by the April 1 and August

1 prior to the start of the fiscal year to

which the rates apply beginning with

the FY 1999 rates. The current schedule

calls for publication on May 1 and

September 1. We are revising § 412.8(b)

and (c) of the regulations to implement

this change. In that section, we are also

deleting the current paragraph (a) since

it is redundant.

M. Technical Change: Correction of

Statutory Citation

The August 30, 1996 final rule (61 FR

46165) included an amendment to

§ 489.27 that reprinted the statutory

reference governing the distribution of

an ‘‘Important Message from Medicare.’’

This reference, ‘‘section 1886(a)(1)(M)’’,

was incorrect. We are correcting this

reference to read ‘‘section

1866(a)(1)(M)’’.

VI. Changes to the Prospective Payment

System for Capital-Related Costs

A. Possible Adjustment to Capital

Prospective Payment System Minimum

Payment Levels

Section 412.348(b) of the regulations

provides that, during the capital

prospective payment system transition

period, any hospital may receive an

additional payment under an exceptions

process if its total inpatient capitalrelated payments under its payment

methodology (that is, fully prospective

or hold-harmless) are less than a

minimum percentage of its allowable

Medicare inpatient capital-related costs.

The minimum payment levels are

established by class of hospitals under

§ 412.348(c). The minimum payment

levels for portions of cost reporting

periods occurring in FY 1997 are:

• Sole community hospitals (located

in either an urban or rural area), 90

percent;

• Urban hospitals with at least 100

beds and a disproportionate share

patient percentage of at least 20.2

percent and urban hospitals with at

least 100 beds that qualify for

disproportionate share payments under

§ 412.106(c)(2), 80 percent; and

• All other hospitals, 70 percent.

Under § 412.348(d), the amount of the

exceptions payment is determined by

comparing the cumulative payments

made to the hospital under the capital

prospective payment system to the

cumulative minimum payment levels

applicable to the hospital, for each cost

reporting period subject to that system.

Any amount by which the hospital’s

cumulative payments for previous cost

reporting periods exceeds its cumulative

minimum payment levels for those cost

reporting periods is deducted from the

additional payment that would

otherwise be payable for a cost reporting

period.

Section 412.348(g) also provides for a

separate special exceptions process for

hospitals undertaking major renovations

or replacement of aging facilities during

the decade of the transition. For as long

as 10 years beyond the end of the

transition period, certain hospitals may

be eligible to receive special exceptions

payments at a 70 percent minimum

payment level. For hospitals that qualify

for the special exceptions provision

before the end of the transition, the

general and special exceptions

provisions will run concurrently during

the later years of the transition.

However, since the minimum payment

level for the special exceptions

provision is at the same level that

applies to all hospitals under the

general provision (currently 70 percent),

the special exceptions provision will

generate no additional payment to

hospitals until the end of the transition

period.

Section 412.348(h) further provides

that total aggregate estimated exceptions

payments under both the regular

exceptions process and the special

exceptions process may not exceed 10

percent of the total estimated capital

prospective payments (exclusive of

hold-harmless payments for old capital)

for the same fiscal year. In the FY 1997

final rule implementing the prospective

payment system for capital-related

costs, we stated that the minimum

payment levels in subsequent transition

years would be revised, if necessary, to

keep the projected percentage of

payments under the exceptions process

at no more than 10 percent of capital

prospective payments.

In section III of the Addendum to the

June 2, 1997, proposed rule (62 FR

29951), we discussed the factors and

adjustments used to develop the FY

1998 Federal and hospital-specific rates.

In particular, we discussed the FY 1998

exceptions payment reduction factor.

This factor adjusts the annual payment

rates for the estimated level of

additional payments for exceptions in

FY 1998. In the proposed rule, we

estimated that exceptions payments

would equal 7.24 percent of aggregate
Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations 46011

payments based on the Federal rate and

the hospital-specific rate. We indicated

that in the final rule we would develop

a new estimate of the level of exceptions

payments, and revise the exceptions

payment adjustment factor accordingly,

on the basis of the data that became

available to us prior to publication of

the final rule for FY 1998. We model

exceptions payments based on the best

information available on hospitals’

actual payment methodology. We also

indicated that while it was not

necessary at that time to propose

reductions in the minimum payment

levels, we might find it necessary to

implement adjustments to the minimum

payment levels in the final rule. We,

therefore, provided public notification

that adjustments to the minimum

payment levels were possible in the FY

1998 final rule.

As explained in Appendix B, since

publication of the proposed rule, we

have made a change to our model with

regard to admissions. This change has

caused the number and dollar value of

exceptions to drop significantly. We are

now estimating that exceptions

payments will equal 3.41 percent of

aggregate payments based on the

Federal rate and hospital-specific rate in

FY 1998, instead of the 7.24 percent we

estimated in the proposed rule. This

also means the exceptions payment

reduction factor, which accounts for

expected exceptions payments, will

reflect a 3.41 percent reduction to the

rates for FY 1998, rather than a 7.24

percent reduction. Because of this

change in our estimate of exceptions

payments, we will not have to adjust

minimum payment levels for FY 1998 to

keep exceptions within 10 percent of

total payments.

In the proposed rule we indicated that

when it did become necessary to adjust

the minimum payment levels in

accordance with § 412.348(h), we would

contemplate adjusting each of the

existing levels (that is, 90 percent for

sole community hospitals, 80 percent

for large urban DSH hospitals, and 70

percent for all other hospitals and

special exceptions) by 5 percentage

point increments until estimated

exceptions payments were within the 10

percent limit. For example, we would

set minimum payment levels at 85

percent for sole community hospitals,

75 percent for large urban DSH

hospitals, and 65 percent for all other

hospitals and special exceptions,

provided that aggregate exceptions

payments at those minimum payment

levels were projected to be no more than

10 percent of total rate-based payments.

We indicated our belief that this policy

appropriately provided for all classes of

hospitals to share in the reduction in

exceptions payments, while

simultaneously preserving the special

protections provided by higher

minimum payment levels for sole

community hospitals and large urban

DSH hospitals relative to all other

hospitals. If aggregate exceptions

payments at those minimum payment

levels still exceeded 10 percent of total

rate-based payments, we proposed to

continue reducing the minimum

payment levels by 5 percentage point

increments each until the requirement

of § 412.348(h) was satisfied. We

provided notification of our thinking on

this issue in order to solicit public

comment on the appropriate method for

adjusting the minimum payment levels.

Comment: We received several

comments expressing concern about our

proposal to cut minimum payment

levels in five percentage point

increments, if necessary, to stay within

the ten percent limit on overall

exceptions payments. The commenters

expressed concern that cutting the

minimum payment levels by five

percentage increments might reduce

exception payments more than

necessary to stay within the ten percent

cap. Some commenters stated that using

five percent incremental adjustments

instead of something more exact was not

consistent with the level of specificity

that HCFA uses to make other types of

adjustments, and recommended that we

use the same level of specificity in

making adjustments to the minimum

payment levels that we use in making

other types of adjustments. Some

commenters recommended that we

adjust minimum payment levels by

tenths of a percent. One commenter

noted that because the minimum

payment levels vary by type of

hospital—90 percent for sole

community hospitals, 80 percent for

urban DSH hospitals, and 70 percent for

all other hospitals and special

exceptions, cutting all hospitals by the

same percentages would affect some

hospitals more than others.

Response: After considering the

commenters’ concerns, we have decided

it would be appropriate to adjust each

of the minimum payment levels by one

percentage point increments in order to

meet the ten percent limit. We are

changing the regulations at § 412.348 to

reflect this change in our policy. We

will make an adjustment to the

minimum payment levels when

necessary by applying this policy.

We decided not to implement the

suggestion made by some commenters

that we adjust the minimum payment

levels to the tenth of a percent level. We

believe such precise adjustments are

inappropriate in this context because

our calculations reflect estimates, not

exact figures. We have also decided not

to adjust groups with higher minimum

payment levels, such as sole community

hospitals and urban DSH hospitals,

more than groups with lower minimum

payment levels, such as all other

hospitals and special exceptions. At the

time we established the minimum

payments, at the inception of capital

PPS, we decided that some groups

warranted higher exception payments

because of the type of care they

provided or their location in a particular

community. We believe it is still

appropriate to maintain those higher

levels of exception payments for sole

community hospitals and urban DSH

hospitals.

Comment: One commenter suggested

that we use excess funds not paid out

for outliers to fund the shortfall in

capital exceptions.

Response: The commenter

misunderstands the prospective nature

of outlier and capital exceptions

policies and projections. We set

payment parameters such as outlier

thresholds and capital minimum

payment levels before a fiscal year based

on estimates. We also make prospective

adjustments to the applicable rates

(operating standardized amounts or

capital Federal rates) to account for the

projected level of outlier payments or

capital exceptions payments. Thus, for

example, we set outlier thresholds so

that the outlier payments for operating

costs are projected to equal 5.1 percent

of total DRG operating payments, and

we adjust the operating standardized

amounts correspondingly. We do not set

aside a pool of money to fund outlier

cases. Moreover, once the payment

parameters and adjustments are

established for a fiscal year, we do not

make retroactive adjustments based on

differences between estimated and

actual payments, whether actual

payments are higher or lower than

estimated payments.

B. Special Exceptions Application

Process

As discussed in section VI.A above, a

separate special exceptions provision

extends protection to certain hospitals

undertaking major renovation or

replacement of aging facilities during

the decade of the transition. The

regulation establishing eligibility for

this special exceptions provision, and

describing the criteria by which eligible

hospitals qualify for special exceptions

payments (§ 412.348(g)), was finalized

on September 1, 1994 (59 FR 45385). In

the proposed rule, we did not propose

to make any policy changes to the
46012 Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations

special exceptions provision. However,

we had received questions from

hospitals and intermediaries about the

special exceptions process, and we

discussed a few aspects of that process

particularly with regard to the age of

assets test and the excess capacity test.

We reviewed the application process,

the project need requirement, the

project size requirement, and the excess

capacity test. We specified that based on

the latest data available, we had decided

to set the 75th percentile for the age of

assets test at 15.4 years rather than the

16.4 years we had originally

contemplated.

We received no comments on these

clarifications to the special exceptions

process.

C. Reduction to the Standard Federal

Capital Payment Rate and the

Unadjusted Hospital-Specific Rate

Section 4402 of Public Law 105–33

amended section 1886(g)(1)(A) of the

Act to require that, for discharges

occurring on or after October 1, 1997,

the Secretary must apply the budget

neutrality adjustment factor used to

determine the Federal capital payment

rate in effect on September 30, 1995 (as

described in § 412.352) to the

unadjusted standard Federal capital

payment rate (as described in

§ 412.308(c)) effective September 30,

1997, and the unadjusted hospitalspecific rate (as described in

§ 412.328(e)(1)) effective September 30,

1997. For discharges occurring on or

after October 1, 1997, and before

September 30, 2002, the Secretary must

reduce the same rates an additional 2.1

percent.

The budget neutrality adjustment

factor effective September 30, 1995 was

.8432 (59 FR 45416) which is equivalent

to a 15.68 percent ((1.0¥.8432) * 100)

reduction in the unadjusted standard

Federal capital payment rate and the

unadjusted hospital-specific rate in

effect on September 30, 1997. The

additional 2.1 percent reduction to the

rates reduces the rates in effect on

September 30, 1997 by a total of 17.78

percent. The unadjusted standard

Federal rate must be distinguished from

the annual Federal rate actually used in

making payment under the capital PPS

system. The unadjusted standard

Federal rate is the underlying or base

rate used to determine the Federal rate

for each Federal fiscal year by applying

the formula described in § 412.308(c).

The annual Federal rate is the result of

that determination process in

§ 412.308(c).

Under the statute, the additional 2.1

percent reduction applies for a limited

time. The language at section 4402

indicates the 2.1 percent reduction

applies to discharges occurring ‘‘before

September 30, 2002’’. This would

require that we calculate special rates

that would be in effect for only one day.

We believe that Congress intended to

apply the reduction to discharges

occurring through September 30, 2002.

Accordingly, we plan to seek a technical

correction to change the date that the

2.1 percent reduction expires from

September 29, 2002, to September 30,

2002. Since we assume this technical

error will be corrected, we are using the

September 30, 2002 expiration date in

our regulations.

When we restore the 2.1 percent

reduction to the Federal rate after

September 30, 2002, we plan to restore

the rate to the level that it would have

been without the reduction. We

determined the adjustment factor for FY

1998 by deducting both cuts (.1568 and

.021) from 1 (1¥.1568¥.021¥.8222).

We then applied .8222 to the unadjusted

standard Federal rate. The adjustment

factor to restore the 2.1 percent cut

would be the adjustment without the 2.1

percent cut (.8432) divided by the

adjustment with the 2.1 percent cut

(.8222) (.8432/.8222=1.02554). To

restore the 2.1 percent reduction, we

will apply 1.02554 to the unadjusted

standard Federal capital payment rate in

setting rates for discharges after

September 30, 2002.

Section 412.328(e) of the regulations

provides that the hospital-specific rate

for each fiscal year is determined by

adjusting the previous fiscal year’s

hospital specific rate by the hospital

specific rate update factor and the

exceptions payment adjustment factor.

After these two adjustments are applied,

a net adjustment to the rate is

determined. The previous year’s

hospital specific rate is analogous to the

standard Federal rate, which is updated

each year to become the annual Federal

rate.

When the 2.1 percent reduction is

restored, most hospitals will have

completed the transition to a fully

prospective payment system for capital

related costs. However, new hospitals

might be eligible for hold harmless

payments beyond the transition, so we

may need to continue to compute a

hospital specific rate. If we need to

restore the 2.1 percent reduction to the

hospital specific rates, we will do so in

a manner similar to that described above

with respect to the unadjusted standard

Federal capital payment rate.

In this final rule with comment

period, we are revising two sections of

the capital prospective payment system

regulations to implement these statutory

requirements. Specifically, we are

revising the regulations at §§ 412.308(c)

and 412.328(e) to provide for the

required 15.68 and 2.1 percent

reduction to the rates. The 2.1 percent

reduction will be restored after

September 30, 2002.

We discuss the effect of this reduction

to the standard Federal rate and other

changes in the adjustment factors to the

FY 1998 Federal rate in section III of the

Addendum to this final rule with

comment period.

D. Revision to the Calculation of the

Puerto Rico Rate

Currently, operating and capital

payments to hospitals in Puerto Rico are

paid on a blend of 75 percent of the

Puerto Rico rate based on data from

Puerto Rico hospitals only, and 25

percent of the national rate based on

data from all hospitals nationwide. As

described in section V.I of this

preamble, the Balanced Budget Act of

1997 increases the national share of the

operating payment from 25 percent to

50 percent, and decreases the Puerto

Rico share of the operating payment

from 75 percent to 50 percent. Under

the broad authority of section 1886(g) of

the Act, we are revising the calculation

of capital payments to Puerto Rico as

well, to parallel the change that is being

made in the calculation of operating

payments to Puerto Rico. Effective

October 1, 1997, we will base capital

payments to hospitals in Puerto Rico on

a blend of 50 percent of the national rate

and 50 percent of the Puerto Rico

specific rate. This change will increase

payments to Puerto Rico hospitals since

the national rate is higher than the

Puerto Rico rate.

In this final rule with comment

period, as required by Public Law 105–

33, we are reducing the unadjusted

standard Federal rate and hospitalspecific rate by 17.78 percent for

discharges occurring on or after October

1, 1997, and before October 1, 2002.

Section 1886(g) of the Act confers broad

authority on the Secretary to implement

a capital prospective payment system.

In accordance with this authority, we

are extending the reduction to the

capital rates to the Puerto Rico capital

rates as described in § 412.374(a).

VII. Changes for Hospitals and Units

Excluded From the Prospective

Payment System

A. New Requirements for Certain

Hospitals Excluded From the

Prospective Payment System

(§ 412.22(e))

In the September 1, 1994 final rule (59

FR 45330), we established several

additional criteria for excluding from
Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations 46013

the prospective payment system longterm care hospitals that occupy space in

the same building or on the same

campus as another hospital

(§ 412.23(e)). Under these criteria, such

facilities (sometimes called ‘‘hospitals

within hospitals’’) could qualify for

exclusion only if the two entities have

separate governing bodies, chief

executive officers, medical staffs, and

chief medical officers. In addition, they

were required to be capable of

performing certain basic hospital

functions without assistance from the

hospitals with which they are colocated, or they had to receive at least

75 percent of their inpatients from

sources other than the co-located

hospital. We further revised these

regulations on September 1, 1995 (60 FR

45778), by adding a third option under

which hospitals that did not meet the

criteria specified above could establish

separate operation by showing that no

more than 15 percent of their inpatient

operating costs were attributable to the

hospital with which they share space.

The regulations were necessary to

prevent inappropriate Medicare

payments to entities that are in effect,

long-stay units of other hospitals. At the

same time, the regulations set forth

criteria to ensure that entities may

qualify for exclusion from the

prospective payment system if an

exclusion is warranted. Exclusion of

long-term care hospitals from the

prospective payment system is

appropriate when hospitals have few

short-stay or low-cost cases and might

be systematically underpaid if the

prospective payment system were

applied to them. These reasons for

exclusion do not apply if the entity that

provides the long-term care is part of a

larger hospital, which does have shortstay and low-cost cases and can be paid

appropriately under the prospective

payment system.

ProPAC has recommended that HCFA

monitor the growth in the number of

long-term care hospitals within

hospitals and evaluate whether the

current Medicare certification rules that

apply to these facilities should be

changed (Recommendation 31). ProPAC

noted that there is concern that the

hospital-within-a-hospital model was

devised as a way for acute care hospitals

to receive higher payments for their

long-stay cases. At the same time, the

model may be an appropriate and

efficient alternative to acute inpatient

care for cases that require additional

services, but at a more intense level than

those provided in other post-acute

settings. ProPAC recommended that

HCFA conduct a comprehensive study

of the characteristics, patient mix,

treatment patterns, costs, and financial

performance of hospitals within

hospitals.

We have been monitoring the

development of the hospital-within-ahospital model. We agree with ProPAC

that our policy should simultaneously

strive to prevent inappropriate

exclusions of units as separate hospitals,

while allowing an appropriate degree of

flexibility for facilities to respond to

changing patient care needs. As a result

of our monitoring efforts, in the June 2,

1997 proposed rule, we proposed two

changes to the hospital-within-ahospital regulations (62 FR 29928). We

proposed to add a new § 412.22(f) to

address hospitals that are unable to

meet certain exclusion criteria solely

because of State law. In addition, we

proposed to extend the application of

these rules to other classes of facilities

that might seek exclusion from the

prospective payment system as

hospitals-within-hospitals.

As discussed in detail in the proposed

rule, the first proposed change

concerned the relationship between the

exclusion criteria and State laws.

Specifically, we proposed to add

§ 412.22(f) to address hospitals that, as

a matter of State law, would be unable

to make the necessary organizational

changes to meet the hospital-within-ahospital criteria. Under our proposal, if

a hospital could not meet the criteria in

§§ 412.23(e)(3) (i) or (iii) (proposed to be

redesignated as §§ 412.22(e) (1) and (3))

solely because its governing body or

medical staff is under the control of a

third entity that also controls the

hospital with which it shares a building

or a campus or cannot meet the criteria

in §§ 412.23(e)(3) (ii) or (iv) (proposed to

be redesignated as §§ 412.22 (e)(2) and

(e)(4)) solely because its chief medical

officer or chief executive officer is

employed by or under contract with

such a third entity, the hospital could

nevertheless qualify for an exclusion if

that hospital meets the other applicable

criteria and:

• Is owned and operated by a State

university;

• Has been continuously owned and

operated by that university since

October 1, 1994;

• Is required by State law to be

subject to the ultimate authority of the

university’s governing body; and

• Was excluded from the prospective

payment system as a long-term care

hospital for any cost reporting period

beginning on or after October 1, 1993,

but before October 1, 1994.

We solicited comments and

suggestions on this issue as well as on

whether the language of the proposed

rule effectively addressed the situation

of hospitals disadvantaged by State law.

We also proposed to redesignate

§ 412.23 (e)(3) through (e)(5) which

specifies the criteria for hospitalswithin-hospitals as § 412.22(e), (g), and

(h). This change would have extended

the application of the hospital-within-ahospital rules to all types of facilities

that can be excluded from the

prospective payment system. As we

stated in the proposed rule, we believe

it is important to exclude, as hospitals

only bona fide separate hospitals, not

units of larger hospitals. We also

proposed to incorporate, within this

extended hospital-within-a-hospital

rule, the above provisions that we

proposed for facilities owned and

operated by a State university.

At the same time, we were

considering whether it was appropriate

for new hospitals-within-hospitals to

receive the exemption from the TEFRA

rate-of-increase ceiling during the first 2

years of operation. We stated that the

purpose of the new hospital exemption

was to recognize that a hospital might

face a period of cost distortions as it

began operations and tried to establish

its presence in its market. We did not

believe that newly established hospitalswithin-hospitals would necessarily face

the same degree of cost distortion

during their initial periods of operation

since they operate within existing,

identifiable hospitals. While we did not

formally propose elimination of the new

hospital exemption for hospitals-withinhospitals at this time, we proposed

considering adoption of such a

provision in this year’s final rule. We

invited comment on whether

elimination of the new hospital

exemption for hospitals-withinhospitals would be advisable.

As discussed in detail below, Public

Law 105–33 made changes in the

treatment of certain long-term care

hospitals. As a result of this new

legislation, we are withdrawing our

proposal regarding State owned

hospitals-within-hospitals and

implementing our proposal concerning

the extension of the hospital-withinhospital rules with some changes. The

discussion that follows details the

provisions of section 4417 of Public Law

105–33, explains how these provisions

will be implemented, and responds to

comments on the proposed rule.

Section 4417 of Public Law 105–33

specifies that a hospital that was

classified by the Secretary on or before

September 30, 1995, as an excluded

long-term care hospital shall continue to

be so classified notwithstanding that it

is located in the same building as, or on

the same campus as, another hospital.
46014 Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations

This statutory provision supersedes

certain aspects of the current regulatory

requirements for long-term care

hospitals-within-hospitals, and affects

our proposal to extend the hospitalwithin-a-hospital criteria to excluded

hospitals other than long-term care

hospitals. While the amendment made

by section 4417 of Public Law 105–33

is specific to long term care hospitals,

we believe the considerations

underlying the legislation also apply to

other types of hospitals-withinhospitals.

In view of this statutory change and

to provide for consistent treatment of all

excluded hospitals-within-hospitals, we

have decided to withdraw our proposal

to include a specific provision for Stateowned hospitals-within-hospitals.

Instead, we are revising § 412.22(e) of

the regulations to provide that for cost

reporting periods beginning on or after

October 1, 1997, if a hospital occupies

space in a building also used by another

hospital, or in one or more entire

buildings located on the same campus

as buildings used by another hospital,

the hospital must meet the hospitalwithin-a-hospital criteria unless the

hospital was excluded from the

prospective payment system on or

before September 30, 1995, in which

case the hospital-within-a-hospital

criteria do not apply. This provision

would apply to all types of excluded

hospitals, not just long-term care

hospitals. The extension of the hospitalwithin-a-hospital criteria to hospitals

not exempt from the criteria based on

their status before October 1995 would

be prospective only for cost reporting

periods beginning on or after October 1,

1997. We wish to emphasize that the

grandfathering provision based on a

hospital’s pre-October 1995 status

would not be made available to any

hospital which may have been excluded

at one time but lost its exclusion for

reasons unrelated to hospital-within-ahospital status.

Comment: One commenter argued

that many hospitals sharing space with

others will need additional time to

comply with the hospital-within-ahospital rules, since they may need to

recruit added staff, make arrangements

with new vendors, and reorganize their

administrative staff and governing

bodies. The commenter suggested that,

to allow these changes to be made, the

effective date should be changed so that

these hospitals would first have to meet

the requirements for cost reporting

periods beginning on or after October 1,

1998 or October 1, 1999. Another

commenter suggested that the proposed

effective dates would result in

impermissible retroactive rulemaking,

and recommended that each hospital

potentially subject to the new rules be

grandfathered for at least one cost

reporting period to allow for an orderly

transition. Another commenter

suggested that the proposal regarding

State-owned hospitals may be moot as a

result of section 4417 of Public Law

105–33, which specifically requires

grandfathering of all long-term care

hospitals-within-hospitals that were

excluded on September 30, 1995.

Response: We agree that, in view of

section 4417 of Public Law 105–33, it

would not be appropriate to adopt our

proposals regarding hospitals-withinhospitals as stated in the proposed rule.

We have considered the commenter’s

concerns; however, we believe use of a

single effective date of October 1, 1997

will result in the most simple and

consistent implementation of the rule.

Comment: One commenter objected to

the parts of the proposal under which a

hospital would have been required to

have been continuously owned and

operated by a State university since

October 1, 1994, and would have been

required to have been excluded for a

cost reporting period beginning after

September 30, 1993 but before October

1, 1994. The commenter asserted that

these provisions would exclude

otherwise qualified facilities from the

grandfathering provision.

Response: As noted above, we are not

adopting the proposal regarding Stateowned hospitals, but have extended the

grandfathering provision to all types of

excluded hospitals which were

excluded on or before September 30,

1995.

Comment: A commenter suggested

that the provisions of the proposed rule

not be applied to hospitals co-located

with long-term care hospitals or to any

excluded hospitals that share space. The

commenter reasoned that this would be

unnecessary because in such cases

where both hospitals are excluded and

serve discrete patient types, there is no

incentive for inappropriate transfers,

referrals, or other abusive practices. The

commenter also recommended that the

organizational separateness

requirements not be applied where 75

percent or more of a hospital’s referrals

come from outside sources.

Response: We believe the rule should

be applied to situations in which the

hospitals that share space are all

excluded. Even in the absence of a new

provider exemption to the TEFRA limit,

a hospital may have incentives to

inappropriately establish a hospitalwithin-a-hospital. For example, the two

facilities may have different target rates

and this may lead to the diversion of

some patients to one of the hospitals for

reasons of payment rather than for the

benefit of the patient. Moreover, the

types of populations treated by different

types of excluded facilities are not

mutually exclusive: rehabilitation

patients can be treated in a long-term

care hospital, and rehabilitation

hospitals are not precluded from

accepting and treating long-stay

patients. Thus, permitting exclusion of

such ‘‘hospitals’’ within other hospitals

may create incentives for abuse that

would be diluted or absent if the

facilities were freestanding. Regarding

the 75 percent referral requirement, we

note that it is intended to measure

functional separateness and thus

complements, but cannot replace, the

structural separateness tests.

Comment: One commenter stated that

although some hospitals have been colocated with others for many years they

have not gained an unfair advantage.

The commenter also believed that the

hospital-within-a-hospital criteria

relating to control over two co-located

hospitals by a third entity are too

stringent and do not recognize that such

arrangements are common among

nonprofit hospitals and are used by

organizations to carry out their fiduciary

responsibilities with respect to

subordinate corporations. The

commenter suggested that the proposed

rules be withdrawn or, if they are not

withdrawn, applied only to requests for

exclusion received on or after October 1,

1997, applied only where the rate of

referral between hospitals is over 25

percent, or both.

Response: As explained above, we

agree that our proposals to extend the

application of the hospital-within-ahospital rules should be applied only

prospectively, starting with cost

reporting periods beginning on or after

October 1, 1997. Further, the rules will

not apply to all excluded hospitals

which were excluded on or before

September 30, 1995. However, we do

not agree that our criteria regarding

control by a third entity are too stringent

or that they unfairly disadvantage

nonprofit hospitals. While it may be

common for corporations to exercise

significant control over their

subordinate components, we continue

to believe this control indicates that the

components are part of a larger

organization, not bona fide separate

hospitals. We also do not agree that a

low rate of referrals between co-located

hospitals is sufficient to avoid the need

to determine that an entity is a bona fide

separate hospital. Even in the absence of

a significant level of referrals, a hospital

unit may be misrepresented as a

separate hospital in order to obtain a

more favorable reimbursement. Thus,
Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations 46015

avoiding referrals does not eliminate all

incentives for abuse.

Comment: ProPAC recommended that

the Secretary conduct an extensive

review of hospitals-within-hospitals, to

determine if the existence of this model

undermines the incentives of the

prospective payment system.

Response: We share this concern and

are monitoring the status of these

facilities. We will continue to review

the status of these facilities and evaluate

the implications of the changes in

Public Law 105–33 affecting newly

excluded hospitals and the hospitalwithin-a-hospital issue.

In addition to the changes discussed

above, in § 412.22(e)(5) (ii) and (iii), we

are adding a reference to ‘‘the six-month

period immediately preceding the first

cost reporting period for which

exclusion is sought.’’ This language

clarifies that the criteria in these

paragraphs also apply to excluded

hospitals other than long term care or

children’s hospitals, since excluded

hospitals other than long-term care or

children’s hospitals do not always have

a prior cost reporting period of at least

6 months that is used to establish length

of stay or treatment of an inpatient

population which is predominantly

individuals under age 18.

B. Exclusion of New Rehabilitation

Units and Expansion of Existing

Rehabilitation Units (§ 412.30(b)(4))

In the September 1, 1995 final rule (60

FR 45839), we made certain changes to

clarify the regulations applicable to the

exclusion of new rehabilitation units

and the expansion of units already

excluded. These changes were intended

only to clarify existing policy, not to

change it. However, in making these

changes we inadvertently omitted a

paragraph that explicitly allowed newly

participating hospitals to open new

rehabilitation units and also to allow the

new rehabilitation units to be excluded

immediately from the prospective

payment system. In omitting this

paragraph, we had no intention of

rescinding the policy. In the June 2,

1997 proposed rule, we indicated that

we would restore this paragraph to the

regulations, which the proposed rule

would have redesignated at

(§ 412.30(b)(4)), to correct this omission

and to reaffirm current policy. (For

further information on this policy, see

the Federal Register published

September 1, 1992 (57 FR 39746)). We

received no comments on this proposal

and are implementing the change in this

final rule with comment period.

C. Delicensing and Relicensing of Beds

(§ 412.30)

We have received a number of

questions about cases in which

hospitals remove some bed capacity

from their State license and Medicare

certifications, then later increase the

number of their licensed and certified

beds and seek to have the bed capacity

‘‘added’’ and considered part of a new,

or newly expanded, prospective

payment system-exempt rehabilitation

unit. Assuming that simultaneous

delicensure and relicensure of beds

would not be accepted as the addition

of new bed capacity, we also have been

asked how long bed capacity would

have to be excluded from a hospital’s

licensure and certification to be

considered ‘‘new’’ for purposes of the

prospective payment system exclusion

rules at § 412.30.

Section 412.30 establishes separate

ways for new and converted units to

meet the exclusion criterion related to

the type of patient population treated.

New units are allowed to qualify for

initial exclusion based in part on a

certification regarding their intent to

treat a patient population of the kind

described in § 412.23(b)(2), rather than

on a showing that they have actually

treated such a population during the

hospital’s most recent cost reporting

period. Converted units may not be

excluded based on a certification, but

must show that they actually met the

§ 412.23(b) requirement during the

hospital’s most recent 12-month cost

reporting period. New units are defined

as those that are part of a hospital that

has not previously sought exclusion for

any rehabilitation unit and that

comprise greater than 50 percent of the

newly licensed and certified bed

capacity, while converted units are

those that do not qualify as new. Section

412.30 also provides for separate

treatment of new and converted bed

capacity that is used to expand existing

units.

Different rules apply to the addition

of new (as opposed to converted) bed

capacity, and it would not be

appropriate to recognize an ‘‘increase’’

in the bed capacity that coincides with

a decrease in bed capacity in another

area, resulting in no net increase in the

hospital’s total licensed and certified

bed capacity. Similarly, it would not be

appropriate to allow a hospital to

circumvent those rules simply by

removing some bed capacity from its

licensure and certification on a

temporary basis, and then increasing its

bed size a few days, weeks, or months

later. Thus, when a hospital seeks to

add a new excluded rehabilitation unit,

or to increase the size of an existing unit

by adding new bed capacity, the bed

size of the hospital in the past must be

taken into account.

The current regulations do not specify

how long a decrease in a hospital’s bed

capacity must be effective before a

subsequent increase in the hospital’s

licensure and certification can be

considered as ‘‘new’’ capacity. However,

to ensure consistent and equitable

treatment of all hospitals with excluded

rehabilitation units, in the June 2, 1997

proposed rule, we proposed to provide

in the regulations (proposed § 412.30(a))

that a decrease in capacity must remain

effective for at least a full 12-month cost

reporting period before an equal or

lesser number of beds can be added to

the hospital’s licensure and certification

and considered ‘‘new’’. This means that

when a hospital seeks to establish a new

unit, or to enlarge an existing unit,

under the criteria in § 412.30, the HCFA

Regional Office will review its records

on the facility to determine whether any

beds have been delicensed and

decertified during the 12-month cost

reporting period before the period for

which the new beds are to be added. To

the extent that bed capacity was

removed from the hospital’s licensure

and certification during that period, that

amount of bed capacity cannot be

considered ‘‘new’’ under § 412.30. For

example, if a hospital with a calendar

year cost reporting period had removed

15 beds from its licensure and

certification in calendar year 1997 and,

for calendar year 1998, sought to set up

a new rehabilitation unit that would

include 20 beds that would be added to

its licensure and certification as of

January 1, 1998, only 5 of those beds

could be considered ‘‘new’’ under

§ 412.30. The remaining beds would be

considered converted beds.

This guideline applies to changes in

a hospital’s total licensed and certified

bed capacity, regardless of whether

specific beds or physical areas within a

hospital have previously been

operational and available to

rehabilitation patients. Thus, if a

hospital delicenses 25 beds on one floor

in the third month of a cost reporting

period and, 2 months later, increases its

licensure and certification by adding a

25-bed unit in a previously unoccupied

area on another floor, that unit could

not be considered ‘‘new’’ under § 412.30

even though it occupies different space

from the beds that represented the

delicensed capacity. This guideline

applies only for purposes of exclusion

from the prospective payment system

and is not intended to limit a hospital’s

ability to add to its licensed and

certified bed capacity for the provision
46016 Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations

of services paid for under the

prospective payment system.

We are also revising § 412.30(c)(1)(ii)

to state that beds that a hospital wishes

to add to an excluded rehabilitation unit

can be considered ‘‘new,’’ and thus

subject to earlier exclusion than existing

beds, only if the hospital’s total

inpatient bed capacity has increased by

an amount that is more than 50 percent

of the number of beds the hospital seeks

to add to the unit, so that the added

beds represent primarily newly licensed

and certified capacity.

Comment: One commenter suggested

that the proposal is too stringent, in that

it does not take into account that

hospitals may be pursuing separate CON

activities—construction of a new facility

to replace an older, larger facility, and

creation of a new rehabilitation unit.

The commenter suggested that the

coincidence of these events could result

in an inadvertent appearance of shifting

of bed capacity and recommended that

we not impose the delicensing rule but

instead rely solely on CON approval to

determine the appropriateness of

expansions in rehabilitation units.

Another commenter suggested that the

proposal is unnecessarily restrictive.

Response: We understand that there

may be situations in which it is

appropriate for a hospital, acting in

response to community needs and

changes in demand for specific types of

services, to separately pursue changes in

bed size as described by this

commenter. While such changes would

not be undertaken with any intent to

evade exclusion requirements, it

nevertheless is clear that they would

constitute a shift of the hospital’s

existing net bed capacity from acute to

rehabilitation use, rather than an

increase in bed capacity. Thus, we

believe such shifts would appropriately

be treated under the rules for conversion

of bed capacity, and thus have not

adopted this comment.

D. Special Excluded Hospital Criteria

Added by Public Law 105–33 (§ 412.23)

Public Law 105–33 added special

criteria for certain hospitals to be

excluded from the prospective payment

system. Section 1886(d)(1)(B)(iv) of the

Act as amended by section 4417(b) of

Public Law 105–33 allows certain

hospitals with an average length of stay

of less than 25 days to be excluded from

the prospective payment system as a

long-term care hospital. In order to be

excluded under this provision, a

hospital must have first been excluded

as a long-term care hospital in calendar

year 1986, have an average inpatient

length of stay of greater than 20 days,

and demonstrate that 80 percent or more

of its annual Medicare inpatient

discharges in the 12-month cost

reporting period ending in Federal fiscal

year 1997 have a principal diagnosis

that reflects a finding of neoplastic

disease. The exclusion under this

provision is effective for cost reporting

periods beginning on or after August 5,

1997 (the date of enactment of Pub. L.

105–33). We are revising § 412.23(e) to

implement this provision.

Section 4418 of Public Law 105–33

provides an additional category of

hospitals that can qualify as cancer

hospitals for purposes of exclusion from

the prospective payment system. As

amended, section 1886(d)(1)(B)(v) of the

Act includes a hospital that meets the

following criteria:

• The hospital was recognized as a

comprehensive cancer center or clinical

cancer research center by the National

Cancer Institute of the National

Institutes of Health as of April 20, 1983.

• The hospital must have applied for

and been denied, on or before December

31, 1990, classification as a cancer

hospital.

• The hospital was licensed for fewer

than 50 acute care beds as of the date

of enactment of this subclause (that is,

August 5, 1997).

• The hospital is located in a State

that, as of December 19, 1989, was not

operating a demonstration project under

section 1814(b) of the Act.

• The hospital demonstrates that, for

the 4-year period ending on December

31, 1996, at least 50 percent of the

hospital’s total discharges have a

principal finding of neoplastic disease;

that is, the discharge has a principal

diagnosis code of 140–239, V58.0,

V58.1, V66.1, V66.2, or 990.

A hospital that meets these criteria is

classified as an excluded cancer

hospital for cost reporting periods

beginning on or after January 1, 1991. In

addition, for purposes of payment, the

base period applicable to such a

hospital is the hospital’s cost reporting

period beginning during FY 1990 or the

period under new section 1886(b)(3)(F)

of the Act (discussed below). We are

revising the regulations at § 412.23(f) to

incorporate this provision.

E. Changes Based on New Legislation for

the Payment of Hospitals and Units

Excluded from the Prospective Payment

System (§ 413.40)

Public Law 105–33 significantly

altered the payment provisions for

excluded hospitals and units. Prior to

the passage of Public Law 105–33, the

payment provisions for excluded

hospitals and units applied consistently

to all categories of excluded providers

(that is, psychiatric, rehabilitation, longterm care, children’s, and cancer).

However, effective for cost reporting

periods beginning on or after October 1,

1997, there are specific payment

provisions for psychiatric,

rehabilitation, and long-term care

providers and modifications to payment

provisions for all excluded providers.

Following is a complete discussion of

the new provisions and the revised

regulations.

1. Rate-of-Increase Percentages for

Excluded Hospitals and Units (§ 413.40

(c) and (g))

Hospitals and units excluded from the

prospective payments system receive

payment for inpatient hospital services

they furnish on the basis of reasonable

costs, subject to a rate-of-increase

ceiling. An annual per discharge limit

(the target amount as defined in

§ 413.40(a)) is set for each hospital or

hospital unit based on the hospital’s

own cost experience in its base year.

The target amount is multiplied by the

Medicare discharges and applied as an

aggregate upper limit (the ceiling as

defined in § 413.40(a)) on total inpatient

operating costs for a hospital’s cost

reporting period.

Section 4411 of Public Law 105–33

amended sections 1886(b)(3)(B) of the

Act regarding the rate-of-increase

percentages to be applied to each target

amount as set forth below.

The applicable rate-of-increase

percentage for the cost reporting period

beginning during FY 1998 is 0 percent.

For cost reporting periods beginning

in FY 1999 through FY 2002, the

applicable rate-of-increase percentage is

the market basket rate of increase

percentage minus a factor based on the

percentage by which the hospital’s

operating costs exceed the hospital’s

ceiling for the most recent cost reporting

period for which information is

available.

• If the hospital’s operating costs are

equal to or exceed 110 percent of the

ceiling amount, the rate-of- increase

percentage increase is equal to the

market basket percentage.

• If the hospital’s costs exceed the

ceiling but are less than 110 percent of

the ceiling, the rate-of-increase

percentage is the market basket rate of

increase minus .25 percentage points for

each percentage point by which costs

are less than 10 percent over the ceiling.

The rate-of- increase percentage is in no

case less than 0 percent.

• If the hospital’s costs are equal to or

less than ceiling but greater than 66.7

percent of the ceiling, the rate-ofincrease percentage is the greater of the

market basket minus 2.5 percentage

points or 0 percent.
Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations 46017

• If the hospital’s costs do not exceed

66.7 percent of the ceiling, the rate-ofincrease percentage is 0 percent.

• If the hospital first receives

payments as an excluded provider on or

after October 1, 1997, the new statutory

payment methodology for new hospitals

applies.

Examples of how the rate-of-increase

percentage provision applies in

determining the applicable rate-ofincrease percentages are as follows:

Example 1

Cost reporting period beginning in FY 1999:

FY 1997 target amount ........ $8,000

Medicare discharges ............ ×100

FY 1997 ceiling .................... $800,000

FY 1997 allowable inpatient

operating costs .................. $1,000,000

FY 1997 costs over (under)

of the ceiling ..................... $200,000

FY 1997 costs as percentage

of the ceiling ..................... 125

FY 1998 rate-of-increase

percentage ......................... 0

FY 1999 rate-of-increase

percentage: market basket 2.60

FY 1999 target amount (FY

1998 target amount of

$8,000×1.026) .................... $8,208

Example 2

Cost reporting period beginning in FY 1999:

FY 1997 target amount ........ $9,800

Medicare discharges ............ ×100

FY 1997 ceiling .................... $980,000

FY 1997 allowable inpatient

operating costs .................. $1,000,000

FY 1997 costs over (under)

the ceiling ......................... $20,000

FY 1997 percent by which

costs exceed (do not exceed) the ceiling ............... 2.04

FY 1998 rate-of-increase

percentage ......................... 0

FY 1999 rate-of-increase percentage:

Market basket ....................... 2.60

Percentage point reduction

(.25×(10¥2.04)) ................ (1.99)

Update (percent) .................. .61

FY 1999 target amount (FY

1998 target amount

$9,800×1.0061) ..................... $9,859.78

Example 3

Cost reporting period beginning in FY 1999:

FY 1997 target amount ........ $10,500

Medicare discharges ............ ×100

FY 1997 ceiling .................... $1,050,000

FY 1997 allowable inpatient

operating costs .................. $1,000,000

FY 1997 costs over (under)

the ceiling ......................... $(50,000)

Example 3—Continued

FY 1997 costs as percentage

of the ceiling ..................... 95.2

FY 1998 rate-of-increase

percentage ......................... 0

FY 1999 percentage increase:

Market basket ....................... 2.60

Percentage point reduction .. (2.50)

Update (percent) .................. .10

FY 1999 target amount (FY

1998 target amount

$10,500×1.001) .................. $10,510.50

Example 4

Cost reporting period beginning in FY 1999:

FY 1997 target amount ........ $16,000

Medicare discharges ............ ×100

FY 1997 ceiling .................... $1,600,000

FY 1997 allowable inpatient

operating costs .................. $1,000,000

FY 1997 costs over (under)

the ceiling ......................... $(600,000)

FY 1997 costs as percentage

of the ceiling ..................... 62.5

FY 1998 rate-of-increase

percentage: ........................ 0

FY 1999 rate-of-increase

percentage ......................... 0

FY 1999 target amount (FY

1998 target amount of

$16,000×1.0) ...................... $16,000

We are revising § 413.40(c)(3)(vi) and

adding new paragraphs (c)(3)(vii) and

(c)(3)(viii) and (g)(5) to set forth the new

rate-of-increase percentage provisions.

2. Request for a new base period

(§ 413.40(b))

Sections 4413(a) and 4413(b) of Public

Law 105–33 amended sections

1886(b)(3) of the Act in order to permit

excluded hospitals and units to elect

(‘‘in a form and manner determined by

the Secretary’’) a rebasing of the target

amount for the 12-month cost reporting

period beginning during FY 1998

(October 1, 1997 through September 30,

1998). Except for a qualified long-term

care hospital, as discussed below, each

excluded hospital or unit under present

or previous ownership that received

Medicare payments during cost

reporting periods beginning before

October 1, 1990 may submit to its fiscal

intermediary a request for rebasing its

target amount. The new section

1886(b)(3)(F) of the Act instructs the

Secretary to determine the rebased

target amount as follows:

(1) The Secretary shall determine the

hospital’s allowable inpatient operating

costs ‘‘for each of the 5 cost reporting

periods for which the Secretary has the

most recent settled cost reports as of the

date of enactment (August 5, 1997)’’.

(2) For each of the 5 cost reporting

periods, the Secretary shall update the

inpatient operating cost per case to FY

1998 using the update factors cited at

section 1886(b)(3)(B) of the Act

(§ 413.40(c)).

(3) The Secretary shall exclude the

highest and lowest of the five updated

amounts for inpatient operating cost per

case.

(4) The Secretary shall compute the

average for the remaining three updated

inpatient operating cost per case.

Under the statute the methodology for

determining a rebased target amount

uses the updated inpatient operating

costs per case from the five most recent

cost reports that have been settled as of

the date of the enactment of the statute

(August 5, 1997). For purposes of this

provision, we will not recalculate the

target amount to reflect cost report

reopenings, changes, or other

adjustments made after August 5, 1997.

Reopenings (or even multiple

reopenings) of any of the five settled

cost reports at later dates could create a

uncertainty of the applicable FY 1998

target amount until well after the end of

FY 1998 and uncertainty about target

amounts for subsequent years.

Accordingly, the hospital must carefully

consider the inpatient operating costs

per case of its five most recent settled

cost reports as of August 5, 1997 in

deciding whether to apply for rebasing

under this provision.

Similarly, if a hospital that received

payments during cost reporting periods

beginning before October 1, 1990 has

reorganized or acquired another similar

excluded provider so that its five most

recent settled cost reports reflect

substantial differences in the size and

expenses of the excluded hospital or

unit, the same considerations apply. It

is not permissible to use fewer than (or

more than) the five most recent settled

cost reports in an attempt to reflect an

operational reorganization. Also, if the

hospital elects rebasing under this

provision, the revised target amount for

FY 1998 continues to be subject to the

75th percentile cap established on the

target amount by Section 4414 of Public

Law 105–33 (discussed below).

Exception payments as governed by

§§ 413.40(g) and (i) will be evaluated

based on a comparison of the hospital’s

operating costs and its costs during the

three years used to calculate the rebased

target amount.

In order to implement the statutory

provision, we are adding

§ 413.40(b)(1)(iv) to describe the manner

in which a hospital must request a

rebased target amount. The hospital

submits the request to its fiscal

intermediary. Due to the extremely short

timeframe between enactment of Public

Law 105–33 on August 5, 1997 and the
46018 Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations

beginning of FY 1998 (on October 1), we

believe it is necessary and appropriate

to establish special rules to address

those hospitals whose cost reporting

periods begin early in FY 1998, in order

to treat all hospitals equitably.

Therefore, the hospital must submit its

request for rebasing by the later of

November 1, 1997 or 60 days prior to

the beginning of its cost reporting

period beginning during FY 1998. We

emphasize that the intermediary must

receive the request by the deadline.

Also, we note that this is a one time

request that must be received by the

deadline for the FY 1998 cost reporting

period.

Upon receipt of a request for a rebased

FY 1998 target amount, the fiscal

intermediary should verify the

submitted request and notify the

hospital of its FY 1998 target amount.

The request for a new base period

must include the following:

• Cover letter, which must include

the items listed below.

—The name of the excluded hospital or

unit;

—The Medicare provider number;

—The beginning and ending dates for

the FY 1998 cost reporting period;

—The fiscal year of the existing base

period and FY 1998 updated target

amount;

—A statement requesting a rebased FY

1998 target amount under

§ 413.40(b)(1)(iv);

—A statement of the rebased FY 1998

target amount per discharge with

supporting documentation in

attachment work papers;

—A list of attachments; and

—A contact person: name, phone

number, and address

• Attachments

—Copies of the Notices of Program

Reimbursement for the five most

recent settled cost reporting periods

—Copies of Worksheet D–1 for the five

most recent settled cost reporting

periods

—A list and/or calculation of the

following for each of the five most

recent settled cost reporting periods:

+ Total Medicare inpatient operating

costs (excluding pass through costs);

+ Total Medicare discharges;

+ Medicare inpatient operating costs

per case; and

+ Medicare inpatient operating costs

per case updated to FY 1998

—A list the highest and lowest of the

five updated inpatient operating cost

per case; and

—A calculation of the average for the

remaining three updated inpatient

operating cost per case

Section 4413(b) of Public Law 105–33

also specified a separate rebasing

election for a qualified long-term care

hospital. The statute defines a qualified

long-term care hospital as a long-term

care hospital that meets the following

two conditions for its two most recent

settled cost reports as of August 5, 1997:

(1) The hospital’s Medicare inpatient

operating costs exceed 115 percent of

the ceiling; and

(2) The hospital would have had a

disproportionate patient percentage (as

defined in § 412.106) equal to or greater

than 70 percent if it were a prospective

payment system hospital. A qualified

long-term care hospital must submit a

request to its fiscal intermediary to have

a rebased target amount in the same

manner as discussed above for other

excluded hospitals. The request must be

received by the fiscal intermediary by

the later of November 1, 1997 or 60 days

prior to the beginning of its cost

reporting period during FY 1998. For a

qualified long-term care hospital, the

methodology for rebasing the target

amount differs. The FY 1998 rebased

target amount is the hospital’s FY 1996

inpatient operating costs updated by the

market basket percentage to FY 1997

only, not to FY 1998, subject to the 75th

percentile cap.

To assist with the application of the

updating of the cost per case to the

subject fiscal period, the increase in the

market basket and the applicable update

factors for excluded hospitals and units

since FY 1990 are:

Fiscal year

Market

basket

(percent)

Update

factor

1990 .................. 5.5 1.055

1991 .................. 5.3 1.053

1992 .................. 4.7 1.047

1993 .................. 4.2 1.042

1994 .................. 4.3 1 1.043

1995 .................. 3.7 1 1.037

1996 .................. 3.4 1 1.034

1997 .................. 2.5 1 1.025

1998 .................. 2.7 1.000

1See § 413.40(b)(3)(v) for method of determining applicable reduction.

We are adding §§ 413.40(b) (iv) and

(v) to set forth the new provisions

regarding request for new base periods.

3. Limitation on the Target Amount for

Excluded Hospitals and Units

(§ 413.40(c))

Section 4414 of Public Law 105–33

amended section 1886(b)(3) of the Act,

to establish caps on the target amounts

for excluded hospitals or units for cost

reporting periods beginning on or after

October 1, 1997, through September 30,

2002. The caps on the target amounts

apply to the following three categories

of excluded hospitals: psychiatric

hospitals and units, rehabilitation

hospitals and units, and long-term care

hospitals. For purposes of calculating

the caps, the statute requires the

Secretary to first ‘‘estimate the 75th

percentile of the target amounts for such

hospitals within [each] class for cost

reporting periods ending during fiscal

year 1996’’. For cost reporting periods

beginning in FY 1998, the Secretary

shall update the amount so determined

by the market basket percentage

increase to FY 1998. For cost reporting

periods beginning during FY 1999

through 2002, the Secretary shall update

the resulting amount by the market

basket percentage.

The estimates of the 75th percentile of

the target amounts were developed from

the best available data on the hospital

specific target amounts for cost

reporting periods ending during fiscal

year 1996 and then updated by the

market basket percentage to FY 1998.

Given the extraordinarily short time

frame between the enactment of Public

Law 105–33 (August 5, 1997) and the

required publication date of this final

rule, we used the best available data that

has been reported to HCFA by the fiscal

intermediaries for over 3,000 hospitals

and units within the classes specified by

the statute.

When an exact target amount was not

available for a particular hospital, we

used the best available information to

estimate the hospital’s target amount.

For example, if the hospital’s target

amount for its cost reporting period

ending during FY 1996 was not

available but the target amount for FY

1995 was available, we updated the FY

1995 target amount by the applicable

percentage increase to determine an

estimate of the hospital’s target amount

for its cost reporting ending during FY

1996. We note that, with respect to longterm care hospitals, we were able to

obtain exact target amount figures for

virtually all hospitals within the class.

A hospital that has a target amount

that is capped at the 75th percentile

would not be granted an exception

payment as governed by §§ 413.40 (a)

and (i) based solely on a comparison of

its costs or patient mix in its base year

to its costs or patient mix in the

payment year. Since the hospital’s target

amount would not be determined based

on its own experience in a base year,

any comparison of costs or patient mix

in its base year to costs or patient mix

in the payment year would be

irrelevant. However, exception

payments would still be available for

hospitals that have target amounts that

are determined by the hospital’s costs in

a base year unaffected by the 75th

percentile cap.
Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations 46019

The 75th percentile of the target

amounts for cost reporting periods

ending during fiscal year 1996, and

updated by the market basket up to FY

1998 are as follows:

(1) Psychiatric hospitals and units:

$10,188

(2) Rehabilitation hospitals and units:

$18,476

(3) Long-term care hospitals: $36,449

We are revising § 413.40(c)(4) (i) and

(ii) to set forth the limitation on the

ceiling provisions.

4. Bonus and Relief Payments

(§ 413.40(d))

a. Bonus Payments

For cost reporting periods beginning

before October 1, 1997, a hospital that

had inpatient operating costs less than

its ceiling is paid costs plus the lower

of 50 percent of the difference between

the inpatient operating costs and the

ceiling; or 5 percent of the ceiling.

Section 4415 of Public Law 105–33

amended section 1886(b)(1)(A) of the

Act to provide that for cost reporting

periods beginning on or after October 1,

1997, the amount of bonus payment is

the lower of the following:

(1) 15 percent of the difference

between the inpatient operating costs

and the ceiling, or

(2) 2 percent of the ceiling.

In addition, section 4415 of Public

Law 105–33 amended Section

1886(b)(2) of the Act to provide for

‘‘continuous improvement bonus

payments’’. Under this new provision,

for cost reporting periods beginning on

or after October 1, 1997, an ‘‘eligible

hospital’’ will receive payments in

addition to the bonus payment

discussed above. An ‘‘eligible hospital’’

is a hospital that been an excluded

provider for at least three full cost

reporting periods prior to the subject

period and whose operating costs per

discharge for the subject period are

below the lower of its target amount,

trended costs (as defined by the statute),

or expected costs (as defined by the

statute) for the subject period. The

amount of the continuous improvement

bonus payment will be equal to the

lesser of—

(1) 50 percent of the amount by which

operating costs were less than the

expected costs for the period; or

(2) 1 percent of the ceiling.

Under the statute, for a hospital with

its third or subsequent cost reporting

period ending in FY 1996, trended costs

are the lesser of allowable inpatient

costs per discharge or the target amount

in FY 1996, increased (in a compounded

manner) for each succeeding fiscal year

by the percentage increase in the market

basket. For all other hospitals, trended

costs are the allowable inpatient

operating costs per discharge for its

third full cost reporting period

increased (in a compounded manner)

for each succeeding fiscal year by the

percentage increase in the market

basket.

Expected costs are the lesser of

operating costs per discharge or the

target amount for the previous cost

reporting period, updated by the

percentage increase in the market basket

for the fiscal year.

b. Relief Payments

For cost reporting periods beginning

on or after October 1, 1984 and before

October 1, 1991, hospitals that had

inpatient operating costs in excess of

their ceiling are to be paid no more than

the ceiling. Section 4005(a) of Public

Law 101–508 (OBRA 1990, enacted

November 5, 1990) amended section

1886(b)(1)(B) of the Act to provide that

for cost reporting periods beginning on

or after October 1, 1991, a hospital

could receive relief payments equal to

50 percent of the costs in excess of the

ceiling not to exceed 10 percent of the

ceiling (after any exceptions or

adjustments).

Section 4415 of Public Law 105–33

amended section 1886(b)(1) of the Act to

provide that for cost reporting periods

beginning on or after October 1, 1997, if

a hospital’s operating costs are greater

than the ceiling but less than 110

percent of the ceiling, payment will be

the ceiling. If a hospital’s costs are

greater than 110 percent of the ceiling,

payment will be the ceiling plus 50

percent of the costs in excess of 110

percent of the ceiling. Total payment

may not exceed 110 percent of the

ceiling.

Because section 4415 of Public Law

105–33 does not provide relief for costs

that are within 110 percent of the

ceiling, we are making a corresponding

change to the exception payment

provision at § 413.40(g)(1) so that

qualification for the amount of an

exception payment does not encompass

costs within 110 percent of the ceiling.

We have revised §§ 413.40(d)(3) and

added (d)(4) and (d)(5) to implement

these provisions.

5. New Excluded Hospitals and Units

(§ 413.40(f))

Under § 413.40(f), a new excluded

hospital is exempted from the rate-ofincrease ceiling until the end of the first

cost reporting period ending at least two

years after the hospital accepts its first

patient (through the second 12-month

cost reporting period). As we discussed

in the June 2, 1997 proposed rule (62 FR

29937), the growth of new excluded

hospitals increasingly includes a large

number of hospitals that are merely

reconfigurations of existing facilities.

These new providers do not require the

same length of time to establish a

presence in the marketplace and

increase patient load. As a result, there

is evidence that the new hospital

exemption does not always serve its

original purpose to recognize certain

cost distortions that may be present as

a hospital begins operations. In

addition, the new hospital exemption

period could create incentives to

increase costs in the exempt years. In its

March 1, 1997 report, ProPAC

recommended that the new hospital

exemption period should be eliminated

and that Medicare payments for new

providers should be based on an average

target amount for facilities serving

comparable types of patients.

With the enactment of sections 4416

and 4419 of Public Law 105–33, which

amend section 1886(b)(4) of the Act and

add section 1886(b)(7) of the Act,

Congress has established a new

framework for payments for new

excluded providers. First, section

4419(a) amends section 1886(b)(4)(A)(i)

of the Act, to eliminate ‘‘exemptions’’

for all classes of excluded entities

except children’s hospitals. This

provision applies to entities that first

qualify for exclusion for cost reporting

periods beginning on or after October 1,

1997. Thus, effective October 1, 1997,

we will no longer grant new provider

exemptions under section 1886(b)(4) of

the Act except with respect to children’s

hospitals.

Second, section 4416 adds a new

section 1886(b)(7) of the Act to establish

a new statutory payment methodology

for certain new hospitals. For purposes

of this provision, the statute specifies

three classes of hospitals: psychiatric

hospitals and units, rehabilitation

hospitals and units, and long-term care

hospitals. Under the statutory

methodology, for a hospital that is

within a class of hospitals specified in

the statute and which first receives

payments on or after October 1, 1997,

the amount of payment shall be

determined as follows.

For each of the first two cost reporting

periods, the amount of payment is the

lesser of (1) the operating costs per case,

or (2) 110 percent of the national

median of target amounts for the same

class of hospitals for cost reporting

periods ending during FY 1996, updated

and adjusted for differences in area

wage levels. For purposes of computing

the target amount for the subsequent

cost reporting period, the target amount

for the preceding cost reporting period
46020 Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations

is equal to the amount determined

under the methodology above for the

preceding period.

To determine payments for a new

hospital’s first two cost reporting

periods, the statute requires a

calculation of a national median of the

target amounts for hospitals in the same

class, updated and adjusted. For each

class of hospitals, using the best

available data we determined the

national median of the target amounts

for hospitals within the class for cost

reporting periods ending during fiscal

year 1996. In determining the national

median, the Secretary makes

adjustments to account for area

differences in wage-related costs.

Pursuant to the broad authority

conferred on the Secretary to determine

an appropriate wage adjustment, we are

making an adjustment on the basis of

the data used to calculate the FY 1998

hospital wage index under the hospital

inpatient prospective payment system

(see § 412.63), without taking into

account reclassifications under section

1886(d)(10) and (d)(8)(B) of the Act. We

recognize that wages may differ for

prospective payment hospitals and

excluded hospitals, but we believe the

wage data do reflect area differences in

wage-related costs; moreover, in light of

the extraordinarily short timeframe for

implementing this provision, this is the

only feasible data source.

We note that, under the statute, the

special payment methodology for new

hospitals applies for each of the

hospital’s first 2 cost reporting periods.

However, a new hospital might begin

operations on a date other than the first

day of its ‘‘usual’’ cost reporting period,

so that its first cost reporting period is

a short period. In order to treat these

hospitals equitably, we believe the

special payment methodology should be

applied to the hospital’s first two full

cost reporting periods.

We also note that, under the

calculation prescribed in new section

1886(b)(7)(A)(i)(II), the limit on payment

for each of the hospital’s first two cost

reporting periods is based on the

national median target amount for cost

reporting periods ending during FY

1996, updated by the hospital market

basket ‘‘to the fiscal year in which the

hospital first received payments’’. That

is, the limit on payment is not updated

by the market basket for the second cost

reporting period. For example, if a new

rehabilitation hospital commences

operation on January 1, 1999 (during FY

1999), it receives the lower of the

hospital’s operating costs or 110 percent

of the applicable national median of

target amounts for cost reporting periods

ending during FY 1996 updated to FY

1999. For its second 12-month cost

reporting period (FY 2000), the limit on

payment is the same (110 percent of the

applicable national median updated to

FY 1999). The statute appears to provide

that the target amount for succeeding

cost reporting periods will be based on

the payment amount in the second 12-

month cost reporting period increased

by the applicable update factors.

Although we are codifying the policies

for subsequent cost reporting periods in

this final rule with comment period, a

technical amendment may be needed to

clarify statutory intent.

The updating process also raises an

issue with respect to hospitals with

short cost reporting periods. The statute

requires that the national median is

updated ‘‘to the fiscal year in which the

hospital first received payments.’’ Thus,

for hospitals with short cost reporting

periods, we would calculate the limit

based on the beginning of its short cost

reporting period, even though the limit

would not be applied until its first full

cost reporting period (as discussed

earlier). We believe these policies treat

such hospitals equitably, so that they

are neither benefitted nor disadvantaged

by the short cost reporting period.

We are revising §§ 413.40(f) (1) and

(2) to incorporate these changes for new

excluded providers.

The table below lists 110 percent of

the national median target amounts for

each class of excluded hospitals for cost

reporting periods ending during FY

1996, adjusted for area wages updated

by the market basket to FY 1998.

(1) Psychiatric hospitals and units $8,203

(2) Rehabilitation hospitals and

units ............................................ 16,129

(3) Long-term care hospitals ......... 18,324

6. Capital Payments for Excluded

Hospitals and Units (§ 413.40(j))

Section 4412 of Public Law 105–33

amended section 1886(g) of the Act to

establish a 15 percent reduction on

capital payments for certain hospitals

and hospital distinct part units

excluded from the prospective payment

system for portions of cost reporting

periods beginning on or after October 1,

1997, through September 30, 2002. The

capital reduction applies to psychiatric

hospitals and units, rehabilitation

hospitals and units, and long-term care

hospitals.

We are adding § 413.40(j) to set forth

the capital reduction provision.

7. Report on Adjustment Payments to

the Ceiling (§ 413.40(g))

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

for an adjustment (exception) payment

to the ceiling if a hospital submits a

request to its fiscal intermediary within

180 days of the date of the Notice of

Program Reimbursement. Changes in the

types of patients served or in-patient

care services that distort the

comparability of a cost reporting period

to the base year are grounds for

requesting an adjustment request. The

reasons and process for requesting an

adjustment request are implemented at

§ 413.40(g). Section 4419(b) of Public

Law 105–33 amended section 1886(b)(4)

of the Act. This section requires the

Secretary to publish annually, in the

Federal Register, a report describing the

total adjustment payments made to

excluded hospitals and units for cost

reporting periods ending during the

previous fiscal year. Effective with the

FY 1999 notice of changes to the

hospital inpatient payment systems, we

will publish the total adjustment

payments made to excluded hospitals

and units by category of hospital

(psychiatric, rehabilitation, long-term

care, cancer, and children’s) during the

previous fiscal year.

VIII. ProPAC Recommendations

As required by law, we reviewed the

March 1, 1997 report submitted by

ProPAC to Congress and gave its

recommendations careful consideration

in conjunction with the proposals set

forth in the proposed rule. We also

responded to the individual

recommendations in the proposed rule.

The comments we received on the

treatment of the ProPAC

recommendations are set forth below,

along with our responses to those

comments. However, if we received no

comments from the public concerning a

ProPAC recommendation or our

response to that recommendation, we

have not repeated the recommendation

and response in the discussion below.

Recommendation 2, concerning the

update for the prospective payment

system operating payment rates, is

discussed in Appendix D of this final

rule with comment period.

Recommendations 3 and 4, concerning

the prospective payment system capital

payment rates, are discussed in section

III. of the Addendum of this final rule

with comment period. Recommendation

13, concerning updating the target

amounts for excluded hospitals and

distinct part units, is discussed in

Appendix D of this final rule with

comment period. Recommendation 31,

concerning long-term care hospitals

within hospitals, is discussed in section

VII. of this final rule with comment

period. The remaining

recommendations on which we received

comments are discussed below.
Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations 46021

A. Improving Medicare’s

Disproportionate Share Hospital (DSH)

Payments and Distribution of those

Payments (Recommendation 9, 10, and

11)

Recommendation: DSH payments

should be concentrated among hospitals

with the highest shares of poor patients.

Therefore, a minimum threshold should

be established for the low-income

patient cost share. Hospitals falling just

above the threshold should receive only

a minimal per case payment, with the

amount then increasing as low-income

share rises. The same general approach

for distributing payments should apply

to all PPS hospitals.

Response in the Proposed Rule:

Congress set the current threshold

payments for Medicare disproportionate

share hospitals in section 6003(c) of the

Omnibus Budget Reconciliation Act of

1989. This provision expanded both the

number of hospitals that could qualify

for disproportionate share payments as

well as the level of those payments for

some categories. We note that large

urban hospitals already receive

payments based on this graduated

payment structure. ProPAC notes that

95 percent of the hospitals receiving

disproportionate share payments are

designated as large urban hospitals. A

May 1990 Congressional Budget Office

(CBO) report to Congress, found that

only large urban hospitals were

overburdened by the cost of caring for

the indigent population.

We agree with ProPAC that the

disproportionate share payments should

be concentrated on the hospitals in

greatest need of assistance.

Comment: ProPAC indicated that the

goal of DSH payments should be to

protect access to hospital care for

Medicare beneficiaries, not merely to

compensate a hospital for the added

costs of treating Medicare patients due

to the hospital’s indigent patient load.

To that end, ProPAC recommended that

the same distribution formula be

applied to all hospitals, regardless of

their size or location. A ProPAC

simulation of a payment system based

on its recommendations showed that

some payments would be redistributed

to rural hospitals (largely because the

current system imposes a stricter

standard for those hospitals to qualify

for a DSH payment) and to hospitals

with large shares of uncompensated care

costs (because the current system does

not recognize this important component

of the hospital industry’s commitment

to treating indigent patients). This

redistribution would be appropriate, in

ProPAC’s view, because it would result

in DSH payments more closely

reflecting the burden borne by hospitals

that treat a large share of poor patients.

ProPAC’s approach to distributing

DSH payments is aimed at ensuring that

available funds are used to help those

hospitals most in need of assistance.

Accordingly, it is important to reflect all

low-income hospital care in the variable

upon which payments will be based,

and ProPAC’s low-income share

measure would capture the costs

associated with all Medicaid patient

days. However, a system based on

ProPAC’s recommendations could be

designed to distribute any level of DSH

funding, and so the inclusion of all

Medicaid costs need not have any

implications for HCFA’s overall

expenditures. The number of hospitals

receiving payments can also be

determined through the choice of the

threshold (minimum low-income cost

share needed to qualify for a DSH

payment).

ProPAC firmly agreed with the

Secretary’s goal of targeting payments to

hospitals with the largest shares of lowincome patients. But this goal can only

be achieved through the development of

a comprehensive and consistently

measured low-income share indicator.

ProPAC’s recommended measure

reflects all relevant groups of lowincome patients (low-income Medicare,

Medicaid, local indigent care program,

and uncompensated care patients),

measured in a consistent fashion that

automatically weights each group

according to its contribution to the

hospital’s overall patient care costs.

The Commission believes that

including bad debts in its recommended

measure of low-income costs would not

materially weaken the incentive to

attempt collection on unpaid accounts.

For the majority of hospitals, the

amount of additional DSH payment that

might be received by foregoing

collection efforts would be dwarfed by

the amount they stand to gain from the

patient. These institutions, therefore,

can be expected to continue their

collection efforts. On the other hand,

those few hospitals with very large lowincome shares, rarely serve the type of

patients among whom aggressive

collection would be worthwhile.

ProPAC believes that the data needed

to implement the low-income cost share

measure it recommends could be

obtained by straightforward means.

Each hospital’s low-income patient cost

share could be estimated by dividing the

sum of charges for all low-income

patient groups by total patient charges.

In its simplest form, only five variables

would need to be collected from each

hospital—aggregate charges for: (1)

patients sponsored by Medicaid, (2)

patients sponsored by indigent care

programs other than Medicaid, (3)

Medicare patients, (4) uncompensated

care, and (5) all patients. Because

hospitals currently must use the same

price schedule for all patients, a

measure of low-income charges as a

percent of total charges would yield

reasonable, accurate, and comparable

estimates of the proportion of costs

devoted to treating low-income patients

across all hospitals.

Another commenter supported

ProPAC’s approach to calculating DSH

payments, and urged HCFA to include

both bad debt and uncompensated care.

This commenter supported HCFA’s

intention to move away from the current

DSH formula, which is based on

Medicaid and Supplemental Security

Income eligibility.

Response: We continue to believe that

there are inconsistencies in the current

Medicare disproportionate share

adjustment calculation, because

Medicaid data varies from State to State.

Therefore, we continue to be interested

in ways to improve the data and the

calculation to better target those

hospitals that treat a disproportionate

share of indigent patients.

We are reluctant to include bad debts

in the calculation because we continue

to believe that it provides an incentive

for hospitals to discontinue their

collection efforts. In addition,

examination of bad debt data has shown

no correlation between bad debts and

hospitals that currently receive some

level of a Medicare disproportionate

share adjustment. In other words, our

examination of the data has shown that

a hospital that currently receives a large

Medicare disproportionate share

adjustment does not necessarily have a

correspondingly large amount of bad

debt.

We also continue to believe that

collection of uncompensated care data

would be burdensome to both the

hospital industry and HCFA and its

fiscal intermediaries. In addition, as

noted in the proposed rule, HCFA has

no means to verify such data. As we

have consistently stated on many

previous occasions, in order for a data

source to be considered usable, it must

be nationally available and auditable.

Hospitals should also be aware that a

change in the formula will almost

certainly produce a change in the

universe of qualifying hospitals and the

levels of the adjustments that these

hospitals receive. We note that section

4403(b) of Public Law 105–33 requires

us to submit a report to Congress by

August 5, 1998 that contains a revised

DSH formula. In determining this

formula, we must do the following:
46022 Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations

• Establish a single threshold for

costs incurred by hospitals in serving

low-income patients.

• Consider the costs incurred by the

hospital in serving both Medicare Part A

beneficiaries who receive SSI and

Medicaid beneficiaries (including those

enrolled in managed care organizations)

who are not entitled to Medicare Part A

benefits.

B. Modifying the Tax Equity and Fiscal

Responsibility Act (TEFRA) Payment

System (Recommendation 14)

Recommendation: Congress should

consider modifying the TEFRA payment

system to correct for the payment

disparity between new and old

providers.

Response in the Proposed Rule: HCFA

has developed legislative proposals to

modify the TEFRA payment system. Our

proposals include rebasing the target

rates for excluded hospitals and units

using an average of each facility’s two

most recent cost reporting periods. This

measure would realign payment rates

with costs for both old and new

providers. In conjunction with rebasing,

the new target rates would be capped at

150 percent of a national mean rate for

each type of facility in order to prevent

newer high cost hospitals from receiving

excessive target rates. Lower cost

hospitals would be protected by

establishing a floor of 70 percent of the

national mean rate for each type of

facility. Incentive payments would be

modified by providing that no such

payment would be made where a

provider incurs costs that are less than

or equal to 110 percent of the target

amount. Finally, the President’s FY

1998 budget proposal would revise the

payment of capital costs to excluded

hospitals and units by reducing

reimbursement for capital to 85 percent

of reasonable costs. TEFRA providers

are the only hospitals that continue to

be reimbursed for capital on a dollar-fordollar basis; consequently, they have no

incentive to control their capital

expenditures. This policy would make

capital reimbursement policy more

consistent among all hospitals and

provide a needed incentive for cost

control, particularly for newer excluded

hospitals and units that may have more

resources for capital expenditures

because they are not as limited by the

target rates on inpatient operating costs.

Comment: Based on its analytic

framework, ProPAC supported an

average update of 2.0 percent for

prospective payment system-excluded

facilities. ProPAC believes that

imposing the prospective payment

system update on prospective payment

system-excluded facilities is not

appropriate. Medicare payment policies

for specialty hospitals and units

excluded from the prospective payment

system differ from those for general

acute care hospitals because these

provider types historically have treated

different patient populations. Likewise,

the financial performance of prospective

payment system-excluded providers is

dissimilar from their prospective

payment system counterparts, largely

because of the underlying payment

policy differences. Consequently,

ProPAC maintains that separate

methodologies should be used to arrive

at appropriate updates.

Both the Secretary and ProPAC agree

that the payment system for prospective

payment system-excluded providers

should be modified to correct for the

payment disparity between new and old

providers. ProPAC will continue to

monitor the financial performance of

providers paid under this system.

Response: We believe that ProPAC’s

concerns are addressed by Section 4411

of Pub. L. 105–33, which amended

sections 1886(b)(3) of the Act regarding

the rate-of-increase percentages. We

have discussed the statutory changes in

section VII of this preamble.

C. Prospective Payment System for

Skilled Nursing Facilities (SNFs)

(Recommendation 19)

Recommendation: A case-mix

adjusted prospective payment system

for skilled nursing facilities should be

implemented as soon as possible.

Response in the Proposed Rule: We

concur with the recommendation to

implement a prospective payment

system for SNFs as soon as possible.

The President’s FY 1998 budget

includes a provision for a prospective

payment system for SNFs to be

implemented on July 1, 1998. This

system will include payment for all

costs (routine, ancillary, and capital)

related to the services furnished to

beneficiaries under Medicare Part A. By

including all costs of services in the

payment rates, spending growth per day

of care can be contained. In addition,

the provision includes authority to

adjust payments to providers where

inappropriate utilization (that is,

excessive lengths of stay) of SNF

services is found. Finally, the proposed

prospective payment system would

include case-mix adjustments using a

resident classification system based on

resource utilization groups. These

resource utilization groups are tied to

elements contained on the Minimum

Data Set (MDS) 2.0 resident assessment

instrument for nursing homes.

Comment: ProPAC commended the

Secretary’s efforts to create a

prospective payment system for SNF

services, and looks forward to reviewing

HCFA’s analyses of resource utilization

groups and their ability to describe the

services provided by SNFs. ProPAC is

concerned about the incentive created

under a per diem payment system for

facilities to increase length of stay, and

believes, therefore, that the Secretary

should continue efforts to develop a

case-mix classification system for use

with an admission-based payment

system. In addition, ProPAC believes

that the Secretary’s efforts to discourage

inappropriate utilization are particularly

important.

Response: While the significant

copayment associated with the

Medicare SNF benefit ($95.00 per day)

acts as a powerful force limiting the

growth of overall length of stay in SNFs,

HCFA is concerned about increases in

utilization under the new prospective

payment system and plans to study this

issue. In addition, HCFA will continue

its efforts towards the development of a

per diem integrated payment and

delivery system that applies to all

Medicare post-acute services. This type

of system has the greatest potential for

providing system-wide financial

integrity, while assuring high quality

care.

D. Home Health Visit Coding

(Recommendation 26)

Recommendation: Medicare should

require consistent home health visit

coding. Such information is essential for

monitoring and evaluating the home

health benefit and developing an

effective case-mix adjustment system.

Response in the Proposed Rule:

Currently, there is no standard

definition of what comprises a visit and

there is variation in the type of service

and length of time for providing those

services. We agree such information is

critical to developing an effective casemix measure for a home health

prospective payment system. In the

case-mix research we are beginning, we

will collect information on the length of

time and procedures performed during

a visit. This information will feed into

the development of a prospective

payment system and related coding

system. We cannot proceed with

specific coding refinements until the

findings are available and a prospective

payment system is designed. We are

researching aspects of that approach

rather than imposing reporting burdens

on all home health agencies.

Comment: ProPAC indicated that

although the Secretary agrees that

information about home health visit

length and content is critical to

developing an effective case-mix
Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations 46023

measure, she does not want to proceed

with specific coding refinements until

the findings from the case-mix

demonstration project are available and

a prospective payment system is

designed.

ProPAC is concerned that without

uniform coding requirements, the

implementation of a prospective

payment system would be further

delayed. ProPAC notes that there is little

information about the types of services

that are provided during a visit and that

the case-mix demonstration project

should guide coding requirements.

Concurrent with the research on a

prospective payment system, the

Commission believes it is important to

begin gathering basic data about the

content of home health visits, which

would be critical in any efforts to

improve the payment method. The

Medicare Home Health Agency Manual

contains a series of aggregate code

definitions that would capture some

detail about the services that are

provided during a visit. HCFA’s

Common Procedure Coding System

(HCPCS) describe some skilled nursing

services and a range of therapy services.

Time increments also could be useful in

understanding visit duration.

Response: Section 1895(c) of the Act,

as added by section 4603 of Public Law

105–33, requires payment information

on all claims for home health services

furnished on or after October 1, 1998.

All claims for home health services

must include a unique physician

identifier and a code (or codes)

specified by the Secretary that identifies

the length of time of the home health

visit as measured in 15 minute

increments. Since there is no standard

definition of what comprises a visit and

there is variation in the length of time

for providing those services, the new

payment information requirements will

provide needed information on the

length of time required for the provision

of home health services. Additionally,

as discussed in our previous response in

the August 30, 1996 final rule, a

contract was awarded to develop a casemix measurement for a home health

prospective payment system. Under the

terms of this contract, extensive

information about the characteristics of

patients and resource utilization will be

collected. Information also will be

collected about visit lengths and

procedures performed during all home

health visits during an episode of care.

E. Home Health Copayments

(Recommendation 27)

Recommendation: Modest beneficiary

copayments, subject to an annual limit,

should be introduced for home health

care services.

Response in the Proposed Rule: We

are concerned about the impact that

higher beneficiary out-of-pocket

expenses would have on poorer

Medicare beneficiaries who are not

covered by Medicaid and cannot afford

supplemental insurance. Poorer

beneficiaries spend a greater proportion

of their income on out-of-pocket costs.

Our proposed interim system of limits

should help control the growth in

service use.

Comment: The Commission

continued to maintain its position that

copayments for home health services are

appropriate. ProPAC believes that

Medicare beneficiaries who receive

home health services should participate

financially in the payment for those

services. Such a policy would be

consistent with Medicare cost-sharing

requirements for other services and

could result in increased involvement

by beneficiaries in treatment decisions.

Copayments also might limit fraudulent

billing practices, since beneficiaries

could identify services for which

Medicare was billed but that were never

delivered. ProPAC recognizes that a

copayment policy would have a more

direct financial impact on beneficiaries

who lack Medicaid or supplemental

coverage. Accordingly, ProPAC believes

that the copayment amount should be

minimal and subject to an annual limit.

Response: The issue of copayments

was thoroughly considered in the

deliberations over Public Law 105–33

and ultimately not adopted in the

legislation. We remain concerned about

the impact that higher beneficiary outof-pocket costs would have on poorer

Medicare beneficiaries who are not

covered by Medicaid and cannot afford

supplemental insurance. Our interim

system of limits should help control the

growth in service use.

F. Prospective Payment System for

Rehabilitation Hospitals and DistinctPart Units (Recommendation 29)

Recommendation: A case-mix

adjusted prospective payment system

for rehabilitation hospitals and distinctpart units should be implemented as

soon as possible.

Response in the Proposed Rule: We

have sponsored research on possible

patient classification systems for

rehabilitation care. In particular, a study

by the RAND Corporation evaluated the

prospects for a prospective payment

system based on the rehabilitation

coding system known as Functional

Independence Measure (FIM) and the

patient classification system known as

Function-Related Groups (FRGs). The

final report on this research will soon be

complete. However, the preliminary

results indicate much work would be

necessary before a prospective payment

system based on FRGs could be

implemented. There are at least two

important implementation issues: the

reliability of the patient status measures

and the recognition of patient

complications and comorbidities. In

addition, implementation of a case-mix

payment system for rehabilitation

hospitals and units would require

significant program resources and

impose data reporting and collection

requirements on providers. As a result,

fewer resources would be available for

research into developing an integrated

payment approach for payment of

rehabilitation care across all settings

(excluded hospitals, SNFs, HHAs,

comprehensive outpatient rehabilitation

facilities, etc.) Thus, we prefer to focus

our efforts on developing a coordinated

payment system for post-acute care that

relies on a core assessment tool.

Comment: ProPAC strongly supported

coordinating payment methods across

postacute sites. The Commission

believes that a separate prospective

payment system for rehabilitation

hospitals and units could be

implemented in the near term, however,

as an incremental step toward a more

comprehensive system for all post-acute

care services. ProPAC’s understanding

is that most Medicare-certified inpatient

rehabilitation facilities already collect

and use the types of data necessary for

the FIM or other standardized patient

assessment instruments. Therefore,

reporting these data to HCFA would not

be an undue burden on providers.

Response: Section 4421 of Public Law

105–33 amended section 1886 of the Act

by adding a new subsection (j), which

provides for implementation of a

prospective case-mix payment system

for excluded rehabilitation hospitals

and units, and begins to phase-in

payments under that system for cost

reporting periods beginning on or after

October 1, 2000. The case-mix payment

system is to be fully implemented for

cost reporting periods beginning on or

after October 1, 2002. We will continue

to work on developing a prospective

payment system for rehabilitation

hospitals and units consistent with this

statutory requirement.

G. Prospective Payment System for

Long-Term Care Hospitals

(Recommendation 30)

Recommendation: A case-mix

adjusted prospective payment system

for long-term care hospitals should be

developed and implemented as soon as

possible.
46024 Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations

Response in the Proposed Rule: We

continually examine data and analyze

proposals to simplify payment

mechanisms and ensure that Medicare

payments reflect efficient and high

quality health care. We will be

interested in evaluating the results of

independent studies on case-mix

measurement for long-stay hospital

patients. At the same time, it is evident

that many long-term care hospitals

furnish extensive rehabilitation care that

overlaps with care furnished in

rehabilitation hospitals. Thus, a

prospective payment system for

postacute care providers which includes

SNFs and rehabilitation hospitals and

units could conceivably be used for

patients in long-term care hospitals. As

a result, we have concerns that the

development and implementation of a

separate prospective payment system for

fewer than 200 Medicare-certified, longterm care hospitals may not be an

efficient use of program resources and

may result in overlapping complexity

and manipulation of payment.

Comment: ProPAC asserted that a

better understanding of long-term care

hospitals with respect to the types of

patients they treat, patterns of care, and

facility costs would be necessary before

these providers could be folded into an

integrated payment system. ProPAC,

therefore, believes that the Secretary

should begin researching patient

classification systems and resource use

for long-term care hospitals soon.

Response: We will continue to

examine data and analyze proposals

consistent with the requirements of

section 4422 of Public Law 105–33. This

section requires the Secretary to submit

a report to Congress not later than

October 1, 1999, regarding different

payment methodologies which may be

feasible for paying long-term care

hospitals under the Medicare program.

IX. Other Required Information

A. Requests for Data From the Public

In order to respond promptly to

public requests for data related to the

prospective payment system, we have

set up a process under which

commenters can gain access to the raw

data on an expedited basis. Generally,

the data are available in computer tape

format or cartridges; however, some files

are available on diskette, and on the

Internet at HTTP://WWW.HCFA.GOV/

STATS/PUBFILES.HTML. In our June 2

proposed rule, we published a list of

data files that are available for purchase

(62 FR 29939).

B. Waiver of Notice of Proposed

Rulemaking and 30-Day Delay in the

Effective Date

We ordinarily publish a notice of

proposed rulemaking in the Federal

Register to provide a period for public

comment before the provisions of the

rule take effect. However, section

1871(b) of the Act provides that

publication of a notice of proposed

rulemaking is not required before a rule

takes effect where ‘‘a statute establishes

a specific deadline for the

implementation of the provision and the

deadline is less than 150 days after the

date of the enactment of the statute in

which the deadline is contained.’’ In

addition, we may waive a notice of

proposed rulemaking if we find good

cause that notice and comment are

impracticable, unnecessary, or contrary

to the public interest.

On June 2, 1997, we published a

proposed rule addressing FY 1998

payment rates and policies for

prospective payment system hospitals

and excluded hospitals (62 FR 29902).

Subsequently, on August 5, 1997, Public

Law 105–33 was enacted. Public Law

105–33 contains a number of provisions

relating to issues addressed in the

proposed rule, as well as issues that

were not specifically addressed in the

proposed rule. These statutory

provisions are generally effective

October 1, 1997.

In accordance with section 1871(b) of

the Act, publication of a notice of

proposed rulemaking is not required

before implementing the statutory

provisions of Public Law 105–33 that

take effect on October 1, 1997. In

addition, given the extremely short

timeframe for implementing these

statutory provisions, we find good cause

to waive notice and comment

procedures with respect to the

provisions of this final rule with

comment period that implement Public

Law 105–33, because it would be

impracticable to undertake such

procedures before those provisions take

effect. We are, however, providing a 60-

day period for public comment on those

provisions.

C. Response to Comments

Because of the large number of items

of correspondence we normally receive

on FR documents published for

comment, we are not able to

acknowledge or respond to them

individually. Comments on the

provisions of this final rule that

implement provisions of the Balanced

Budget Act of 1997 will be considered

if we receive them by the date specified

in the DATES section of this preamble.

We will not consider comments

concerning provisions that remain

unchanged from the June 2, 1997

proposed rule or that were changed

based on public comments.

List of Subjects

42 CFR Part 400

Grant programs-health, Health

facilities, Health maintenance

organizations (HMO), Medicaid,

Medicare, Reporting and recordkeeping

requirements.

42 CFR Part 409

Health facilities, Medicare.

42 CFR Part 410

Health facilities, Health professions,

Kidney diseases, Laboratories,

Medicare, Reporting and recordkeeping

requirements, Rural areas, X-rays.

42 CFR Part 411

Kidney diseases, Medicare, Recovery

against third parties, Reporting and

recordkeeping requirements, Secondary

payments.

42 CFR Part 412

Administrative practice and

procedure, Health facilities, Medicare,

Puerto Rico, Reporting and

recordkeeping requirements.

42 CFR Part 413

Health facilities, Kidney diseases,

Medicare, Puerto Rico, Reporting and

recordkeeping requirements.

42 CFR Part 424

Emergency medical services, Health

facilities, Health professions, Medicare.

42 CFR Part 440

Grant programs—health, Medicaid.

42 CFR Part 485

Grant programs-health, Health

facilities, Medicaid, Medicare,

Reporting and recordkeeping

requirements.

42 CFR Part 488

Administrative practice and

procedure, Forms and guidelines,

Health facilities, Survey and

certification.

42 CFR Part 489

Health facilities, Medicare, Reporting

and recordkeeping requirements.

42 CFR Part 498

Administrative practice and

procedure, Health facilities, Health

professions, Medicare, Reporting and

recordkeeping requirements.

42 CFR chapter IV is amended as set

forth below:
Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations 46025

PART 400—INTRODUCTION;

DEFINITIONS

A. Part 400 is amended as follows:

1. The authority citation for Part 400

continues to read as follows:

Authority: Secs. 1102 and 1871 of the

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

1395hh) and 44 U.S.C. Chapter 35.

2. In § 400.202, the introductory text

is republished, the definitions of

‘‘Essential access community hospital

(EACH)’’, ‘‘Provider’’, and ‘‘Services’’

are revised, the definition of ‘‘Rural

primary care hospital (RPCH)’’ is

removed, and a new definition of

‘‘Critical access hospital (CAH)’’ is

added in alphabetical order, to read as

follows:

§ 400.202 Definitions specific to Medicare.

As used in connection with the

Medicare program, unless the context

indicates otherwise—

* * * * *

Critical access hospital (CAH) means

a facility designated by HFCA as

meeting the applicable requirements of

section 1820 of the Act and of subpart

F of part 485 of this chapter.

* * * * *

Essential access community hospital

(EACH) means a hospital designated by

HCFA as meeting the applicable

requirements of section 1820 of the Act

and of subpart G of part 412 of this

chapter, as in effect on September 30,

1997.

* * * * *

Provider means a hospital, a CAH, a

skilled nursing facility, a

comprehensive outpatient rehabilitation

facility, a home health agency, or a

hospice that has in effect an agreement

to participate in Medicare, or a clinic, a

rehabilitation agency, or a public health

agency that has in effect a similar

agreement but only to furnish outpatient

physical therapy or speech pathology

services, or a community mental health

center that has in effect a similar

agreement but only to furnish partial

hospitalization services.

* * * * *

Services means medical care or

services and items, such as medical

diagnosis and treatment, drugs and

biologicals, supplies, appliances, and

equipment, medical social services, and

use of hospital, CAH, or SNF facilities.

* * * * *

PART 409—HOSPITAL INSURANCE

BENEFITS

B. Part 409 is amended as follows:

1. The authority citation for Part 409

continues to read as follows:

Authority: Secs. 1102 and 1871 of the

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

1395hh).

Subpart D—Requirements for

Coverage of Posthospital SNF Care

2. In § 409.30, the introductory text of

paragraph (a) is republished and

paragraph (a)(1) is revised to read as

follows:

§ 409.30 Basic requirements.

* * * * *

(a) Preadmission requirements. The

beneficiary must—

(1) Have been hospitalized in a

participating or qualified hospital or

participating CAH, for medically

necessary inpatient hospital or inpatient

CAH care, for at least 3 consecutive

calendar days, not counting the date of

discharge; and

* * * * *

PART 410—SUPPLEMENTARY

MEDICAL INSURANCE (SMI)

BENEFITS

C. Part 410 is amended as follows:

1. The authority citation for Part 410

continues to read as follows:

Authority: Secs. 1102 and 1871 of the

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

1395hh)), unless otherwise noted.

2. Section 410.2 is amended by

revising the definition of ‘‘Participating’’

to read as follows:

§ 410.2 Definitions.

* * * * *

Participating refers to a hospital,

CAH, SNF, HHA, CORF, or hospice that

has in effect an agreement to participate

in Medicare; or a clinic, rehabilitation

agency, or public health agency that has

a provider agreement to participate in

Medicare but only for purposes of

providing outpatient physical therapy,

occupational therapy, or speech

pathology services; or a CMHC that has

in effect a similar agreement but only for

purposes of providing partial

hospitalization services, and

nonparticipating refers to a hospital,

CAH, SNF, HHA, CORF, hospice, clinic,

rehabilitation agency, public health

agency, or CMHC that does not have in

effect a provider agreement to

participate in Medicare.

3. Section 410.152 is amended by

revising paragraph (k) to read as follows:

§ 410.152 Amounts of payment.

* * * * *

(k) Amount of payment: Outpatient

CAH services. Payment for critical

access hospital outpatient services is the

reasonable cost of the CAH in providing

these services, as determined in

accordance with section 1861(v)(1)(A) of

the Act and with the applicable

principles of cost reimbursement in part

413 and in part 415 of this chapter.

Payment for CAH outpatient services is

subject to the applicable Medicare Part

B deductible and coinsurance amounts,

as described in § 413.70(b)(3) of this

chapter.

§ 410.155 [Amended]

4. Section 410.155 is amended by

adding the phrase ‘‘; or a critical access

hospital (CAH) meeting the

requirements of Part 485, subpart F of

this chapter’’ at the end of the last

sentence of paragraph (a); and adding

the phrase ‘‘or CAH’’ at the end of the

last sentence of the introductory text of

paragraph (b).

D. Part 412 is amended as follows:

PART 412—PROSPECTIVE PAYMENT

SYSTEMS FOR INPATIENT HOSPITAL

SERVICES

1. The authority citation for part 412

continues to read as follows:

Authority: Secs. 1102 and 1871 of the

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

1395hh).

Subpart A—General Provisions

2. In § 412.2, the introductory text of

paragraph (f) is republished and

paragraph (f)(8) is revised to read as

follows:

§ 412.2 Basis of payment.

* * * * *

(f) Additional payments to hospitals.

In addition to payments based on the

prospective payment rates for inpatient

operating costs and inpatient capitalrelated costs, hospitals receive

payments for the following:

* * * * *

(8) For discharges on or after June 19,

1990, and before October 1, 1994, and

for discharges on or after October 1,

1997, a payment amount per unit for

blood clotting factor provided to

Medicare inpatients who have

hemophilia.

3. Section 412.8 is amended by

revising paragraph (b) to read as follows:

§ 412.8 Publication of schedules for

determining prospective payment rates.

* * * * *

(b) Annual publication of schedule for

determining prospective payment rates.

(1) HCFA proposes changes in the

methods, amounts, and factors used to

determine inpatient prospective

payment rates in a Federal Register

document published for public

comment not later than the April 1

before the beginning of the Federal
46026 Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations

fiscal year in which the proposed

changes would apply.

(2) HCFA publishes a Federal

Register document setting forth final

methods, amounts, and factors for

determining inpatient prospective

payment rates not later than the August

1 before the Federal fiscal year in which

the rates would apply.

Subpart B—Hospital Services Subject

to and Excluded From the Prospective

Payment Systems for Inpatient

Operating Costs and Inpatient CapitalRelated Costs

4. Section 412.22 is amended by

revising paragraph (a) and adding new

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

follows:

§ 412.22 Excluded hospitals and hospital

units: General rules.

(a) Criteria. Subject to the criteria set

forth in paragraph (e) of this section, a

hospital is excluded from the

prospective payment systems if it meets

the criteria for one or more of the

excluded classifications described in

§ 412.23.

* * * * *

(e) Hospitals within hospitals. Except

as provided in paragraph (f) of this

section, for cost reporting periods

beginning on or after October 1, 1997, a

hospital that occupies space in a

building also used by another hospital,

or in one or more entire buildings

located on the same campus as

buildings used by another hospital,

must meet the following criteria in order

to be excluded from the prospective

payment system:

(1) Separate governing body. The

hospital has a governing body that is

separate from the governing body of the

hospital occupying space in the same

building or on the same campus. The

hospital’s governing body is not under

the control of the hospital occupying

space in the same building or on the

same campus, or of any third entity that

controls both hospitals.

(2) Separate chief medical officer. The

hospital has a single chief medical

officer who reports directly to the

governing body and who is responsible

for all medical staff activities of the

hospital. The chief medical officer of the

hospital is not employed by or under

contract with either the hospital

occupying space in the same building or

on the same campus or any third entity

that controls both hospitals.

(3) Separate medical staff. The

hospital has a medical staff that is

separate from the medical staff of the

hospital occupying space in the same

building or on the same campus. The

hospital’s medical staff is directly

accountable to the governing body for

the quality of medical care provided in

the hospital, and adopts and enforces

bylaws governing medical staff

activities, including criteria and

procedures for recommending to the

governing body the privileges to be

granted to individual practitioners.

(4) Chief executive officer. The

hospital has a single chief executive

officer through whom all administrative

authority flows, and who exercises

control and surveillance over all

administrative activities of the hospital.

The chief executive officer is not

employed by, or under contract with,

either the hospital occupying space in

the same building or on the same

campus or any third entity that controls

both hospitals.

(5) Performance of basic hospital

functions. The hospital meets one of the

following criteria:

(i) The hospital performs the basic

functions specified in §§ 482.21 through

482.27, 482.30, and 482.42 of this

chapter through the use of employees or

under contracts or other agreements

with entities other than the hospital

occupying space in the same building or

on the same campus, or a third entity

that controls both hospitals. Food and

dietetic services and housekeeping,

maintenance, and other services

necessary to maintain a clean and safe

physical environment could be obtained

under contracts or other agreements

with the hospital occupying space in the

same building or on the same campus,

or with a third entity that controls both

hospitals.

(ii) For the same period of at least 6

months used to determine compliance

with the criterion regarding the age of

patients in § 412.23(d)(2) or the lengthof-stay criterion in § 412.23(e)(2), or for

hospitals other than children’s or longterm care hospitals, for a period of at

least 6 months immediately preceding

the first cost reporting period for which

exclusion is sought, the cost of the

services that the hospital obtained

under contracts or other agreements

with the hospital occupying space in the

same building or on the same campus,

or with a third entity that controls both

hospitals, is no more than 15 percent of

the hospital’s total inpatient operating

costs, as defined in § 412.2(c). For

purposes of this paragraph (e)(5)(ii),

however, the costs of preadmission

services are those specified under

§ 413.40(c)(2) rather than those specified

under § 412.2(c)(5).

(iii) For the same period of at least 6

months used to determine compliance

with the criterion regarding the age of

inpatients in § 412.23(d)(2) or the

length-of-stay criterion in § 412.23(e)(2),

or for hospitals other than children’s or

long-term care hospitals, for the period

of at least 6 months immediately

preceding the first cost reporting period

for which exclusion is sought, the

hospital has an inpatient population of

whom at least 75 percent were referred

to the hospital from a source other than

another hospital occupying space in the

same building or on the same campus.

(f) Application for certain hospitals. If

a hospital has been excluded from the

prospective payment systems under this

section on or before September 30, 1995,

the criteria in paragraph (e) of this

section do not apply to the hospital.

(g) Definition of control. For purposes

of this section, control exists if an

individual or an organization has the

power, directly or indirectly,

significantly to influence or direct the

actions or policies of an organization or

institution.

5. Section 412.23 is amended by

revising paragraphs (e) and (f) to read as

follows:

§ 412.23 Excluded hospitals:

Classifications.

* * * * *

(e) Long-term care hospitals. A longterm care hospital must meet the

requirements of paragraphs (e)(1) or

(e)(2) of this section, and, where

applicable, the additional requirements

§ 412.22(e).

(1) The hospital must have a provider

agreement under part 489 of this chapter

to participate as a hospital and an

average inpatient length of stay greater

than 25 days as calculated under

paragraph (e)(3) of this section.

(2) For cost reporting periods

beginning on or after August 5, 1997, a

hospital that was first excluded from the

prospective payment system under this

section in 1986 must have an average

inpatient length of stay of greater than

20 days, as calculated under paragraph

(e)(3) of this section, and must

demonstrate that at least 80 percent of

its annual Medicare inpatient discharges

in the 12-month cost reporting period

ending in fiscal year 1997 have a

principal diagnosis that reflects a

finding of neoplastic disease as defined

in paragraph (f)(1)(iv) of this section.

(3) The average inpatient length of

stay is calculated—

(i) By dividing the number of total

inpatient days (less leave or pass days)

by the number of total discharges for the

hospital’s most recent complete cost

reporting period;

(ii) If a change in the hospital’s

average length-of-stay is indicated, by

the same method for the immediately

preceding 6-month period; or
Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations 46027

(iii) If a hospital has undergone a

change of ownership (as described in

§ 489.18 of this chapter) at the start of

a cost reporting period or at any time

within the preceding 6 months, the

hospital may be excluded from the

prospective payment system as a longterm care hospital for a cost reporting

period if, for the 6 months immediately

preceding the start of the period

(including time before the change of

ownership), the hospital has the

required average length of stay,

continuously operated as a hospital, and

continuously participated as a hospital

in Medicare.

(f) Cancer hospitals—(1) General rule.

Except as provided in paragraph (f)(2) of

this section, if a hospital meets the

following criteria, it is classified as a

cancer hospital and is excluded from

the prospective payment systems

beginning with its first cost reporting

period beginning on or after October 1,

1989. A hospital classified after

December 19, 1989, is excluded

beginning with its first cost reporting

period beginning after the date of its

classification.

(i) It was recognized as a

comprehensive cancer center or clinical

cancer research center by the National

Cancer Institute of the National

Institutes of Health as of April 20, 1983.

(ii) It is classified on or before

December 31, 1990, or, if on December

19, 1989, the hospital was located in a

State operating a demonstration project

under section 1814(b) of the Act, the

classification is made on or before

December 31, 1991.

(iii) It demonstrates that the entire

facility is organized primarily for

treatment of and research on cancer

(that is, the facility is not a subunit of

an acute general hospital or universitybased medical center).

(iv) It shows that at least 50 percent

of its total discharges have a principal

diagnosis that reflects a finding of

neoplastic disease. (The principal

diagnosis for this purpose is defined as

the condition established after study to

be chiefly responsible for occasioning

the admission of the patient to the

hospital. For the purposes of meeting

this definition, only discharges with

ICD–9–CM principal diagnosis codes of

140 through 239, V58.0, V58.1, V66.1,

V66.2, or 990 will be considered to

reflect neoplastic disease.)

(2) Alternative. A hospital that

applied for and was denied, on or before

December 31, 1990, classification as a

cancer hospital under the criteria set

forth in paragraph (f)(1) of this section

is classified as a cancer hospital and is

excluded from the prospective payment

systems beginning with its first cost

reporting period beginning on or after

January 1, 1991, if it meets the criterion

set forth in paragraph (f)(1)(i) of this

section and the hospital is—

(i) Licensed for fewer than 50 acute

care beds as of August 5, 1997;

(ii) Is located in a State that as of

December 19, 1989, was not operating a

demonstration project under section

1814(b) of the Act; and

(iii) Demonstrates that, for the 4-year

period ending on December 31, 1996, at

least 50 percent of its total discharges

have a principal diagnosis that reflects

a finding of neoplastic disease as

defined in paragraph (f)(1)(iv) of this

section.

* * * * *

6. Section 412.30 is amended by

redesignating paragraphs (a) through (d)

as paragraphs (b) through (e),

respectively, and adding a new

paragraph (a). Redesignated paragraph

(b) is further amended by redesignating

paragraph (b)(4) as paragraph (b)(5), and

adding a new paragraph (b)(4). The

introductory text of redesignated

paragraph (d)(1) is republished and

redesignated paragraph (d)(1)(ii) is

revised to read as follows:

§ 412.30 Exclusion of new rehabilitation

units and expansion of units already

excluded.

(a) Bed capacity in units. A decrease

in bed capacity must remain in effect for

at least a full 12-month cost reporting

period before an equal or lesser number

of beds can be added to the hospital’s

licensure and certification and

considered ‘‘new’’ under paragraph (b)

of this section. Thus, when a hospital

seeks to establish a new unit under the

criteria under paragraph (b) of this

section, or to enlarge an existing unit

under the criteria under paragraph (d) of

this section, the regional office will

review its records on the facility to

determine whether any beds have been

delicensed and decertified during the

12-month cost reporting period before

the period for which the hospital seeks

to add the beds. To the extent bed

capacity was removed from the

hospital’s licensure and certification

during that period, that amount of bed

capacity may not be considered ‘‘new’’

under paragraph (b) of this section.

(b) New units.

* * * * *

(4) If a hospital that has not

previously participated in the Medicare

program seeks exclusion of a

rehabilitation unit, it may designate

certain beds as a new rehabilitation unit

for the first full 12-month cost reporting

period that occurs after it becomes a

Medicare-participating hospital. The

written certification described in

paragraph (b)(2) of this section also is

effective for any cost reporting period of

not less than 1 month and not more than

11 months occurring between the date

the hospital began participating in

Medicare and the start of the hospital’s

regular 12-month cost reporting period.

* * * * *

(d) Expansion of excluded

rehabilitation units.

(1) New bed capacity. The beds that

a hospital seeks to add to its excluded

rehabilitation unit are considered new

beds only if—

* * * * *

(ii) The hospital has obtained

approval, under State licensure and

Medicare certification, for an increase in

its hospital bed capacity that is greater

than 50 percent of the number of beds

it seeks to add to the unit.

* * * * *

Subpart D—Basic Methodology for

Determining Prospective Payment

Federal Rates for Inpatient Operating

Costs

7. In § 412.63, paragraph (p) is

revised, paragraphs (q) through (s) are

redesignated as paragraphs (u) through

(w), respectively, and new paragraphs

(q) through (t) are added to read as

follows:

§ 412.63 Federal rates for inpatient

operating costs for fiscal years after

Federal fiscal year 1984.

* * * * *

(p) Applicable percentage change for

fiscal year 1998. The applicable

percentage change for fiscal year 1998 is

0 percent for hospitals in all areas.

(q) Applicable percentage change for

fiscal year 1999. The applicable

percentage change for fiscal year 1999 is

the percentage increase in the market

basket index for prospective payment

hospitals (as defined in § 413.40(a) of

this subchapter) minus 1.9 percentage

points for hospitals in all areas.

(r) Applicable percentage change for

fiscal year 2000. The applicable

percentage change for fiscal year 2000 is

the percentage increase in the market

basket index for prospective payment

hospitals (as defined in § 413.40(a) of

this chapter) minus 1.8 percentage

points for hospitals in all areas.

(s) Applicable percentage change for

fiscal years 2001 and 2002. The

applicable percentage change for fiscal

years 2001 and 2002 is the percentage

increase in the market basket index for

prospective payment hospitals (as

defined in § 413.40(a) of this

subchapter) minus 1.1 percentage points

for hospitals in all areas.
46028 Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations

(t) Applicable percentage change for

fiscal year 2003 and for subsequent

years. The applicable percentage change

for fiscal year 2003 and for subsequent

years is the percentage increase in the

market basket index for prospective

payment hospitals (as defined in

§ 413.40(a)) for hospitals in all areas.

* * * * *

Subpart F—Payment for Outlier Cases

8. Section 412.80 is revised to read as

follows:

§ 412.80 General provisions.

(a) Basic rule—(1) Discharges

occurring on or after October 1, 1994

and before October 1, 1997. For

discharges occurring on or after October

1, 1994, and before October 1, 1997,

except as provided in paragraph (b) of

this section concerning transferring

hospitals, HCFA provides for additional

payment, beyond standard DRG

payments, to a hospital for covered

inpatient hospital services furnished to

a Medicare beneficiary if either of the

following conditions is met:

(i) The beneficiary’s length-of-stay

(including days at the SNF level of care

if a SNF bed is not available in the area)

exceeds the mean length-of-stay for the

applicable DRG by the lesser of the

following:

(A) A fixed number of days, as

specified by HCFA; or

(B) A fixed number of standard

deviations, as specified by HCFA.

(ii) The beneficiary’s length-of-stay

does not exceed criteria established

under paragraph (a)(1)(i) of this section,

but the hospital’s charges for covered

services furnished to the beneficiary,

adjusted to operating costs and capital

costs by applying cost-to-charge ratios

as described in § 412.84(h), exceed the

DRG payment for the case plus a fixed

dollar amount (adjusted for geographic

variation in costs) as specified by HCFA.

(2) Discharges occurring on or after

October 1, 1997. For discharges

occurring on or after October 1, 1997,

except as provided in paragraph (b) of

this section concerning transfers, HCFA

provides for additional payment,

beyond standard DRG payments, to a

hospital for covered inpatient hospital

services furnished to a Medicare

beneficiary if the hospital’s charges for

covered services, adjusted to operating

costs and capital costs by applying costto-charge ratios as described in

§ 412.84(h), exceed the DRG payment

for the case plus a fixed dollar amount

(adjusted for geographic variation in

costs) as specified by HCFA.

(b) Outlier cases in transferring

hospitals. HCFA provides cost outlier

payments to a transferring hospital that

does not receive payment under

§ 412.2(b) for discharges specified in

§ 412.4(d)(2), if the hospital’s charges for

covered services furnished to the

beneficiary, adjusted to cost by applying

a national cost/charge ratio, exceed the

DRG payment for the case plus a fixed

dollar amount (adjusted for geographic

variation in costs) as specified by HCFA,

divided by the geometric mean length of

stay for the DRG and multiplied by the

beneficiary’s length of stay plus 1 day.

(c) Publication and revision of outlier

criteria. HCFA will issue threshold

criteria for determining outlier payment

in the annual notice of the prospective

payment rates published in accordance

with § 412.8(b).

§ 412.82 [Amended]

9. In § 412.82(a), in the first sentence,

the word ‘‘If’’ is removed and the phrase

‘‘For discharges occurring before

October 1, 1997, if’’ is added in its

place.

§ 412.84 [Amended]

10. In § 412.84, in the first sentence of

paragraph (a), the reference

‘‘§ 412.80(a)(1)(ii)’’ is revised to read

‘‘§ 412.80(a)’’, and the last sentence of

paragraph (g) is removed.

§ 412.86 [Amended]

11. In the introductory text to

§ 412.86, the word ‘‘If’’ is removed and

the phrase ‘‘For discharges occurring

before October 1, 1997, if’’ is added in

its place.

Subpart G—Special Treatment of

Certain Facilities Under the

Prospective Payment System for

Inpatient Operating Costs

12. Section 412.90 is amended by

redesignating paragraphs (i) and (j) as

paragraphs (j) and (k), respectively,

adding a new paragraph (i), and revising

newly designated paragraphs (j) and (k),

to read as follows:

§ 412.90 General rules.

* * * * *

(i) Hospitals that receive an

additional update for FYs 1998 and

1999. For FYs 1998 and 1999, HCFA

makes an upward adjustment to the

standardized amounts for certain

hospitals that do not receive indirect

medical education or disproportionate

share payments and are not Medicaredependent, small rural hospitals. The

criteria for identifying these hospitals

are set forth in § 412.107.

(j) Medicare-dependent, small rural

hospitals. For cost reporting periods

beginning on or after April 1, 1990 and

ending before October 1, 1994, or

beginning on or after October 1, 1997

and ending before October 1, 2001,

HCFA adjusts the prospective payment

rates for inpatient operating costs

determined under subparts D and E of

this part if a hospital is classified as a

Medicare-dependent, small rural

hospital. Criteria for identifying these

hospitals are set forth in § 412.108.

(k) Essential access community

hospitals (EACHs). If a hospital was

designated as an EACH by HCFA as

described in § 412.109(a) and is located

in a rural area as defined in

§ 412.109(b), HCFA determines the

prospective payment rate for that

hospital, as it does for sole community

hospitals, under § 412.92(d).

13. In § 412.96, the introductory text

of paragraph (c)(1) is revised, paragraph

(f) is removed and reserved, and

paragraph (g) is revised, to read as

follows:

§ 412.96 Special treatment: Referral

centers.

* * * * *

(c) * * *

(1) Case-mix index. HCFA sets forth

national and regional case-mix index

values in each year’s annual notice of

prospective payment rates published

under § 412.8(b). The methodology

HCFA uses to calculate these criteria is

described in paragraph (g) of this

section. The case-mix index value to be

used for an individual hospital in the

determination of whether it meets the

case-mix index criteria is that calculated

by HCFA from the hospital’s own billing

records for Medicare discharges as

processed by the fiscal intermediary and

submitted to HCFA. The hospital’s casemix index for discharges (not including

discharges from units excluded from the

prospective payment system under

subpart B of this part) during the most

recent Federal fiscal year that ended at

least one year prior to the beginning of

the cost reporting period for which the

hospital is seeking referral center status

must be at least equal to—

* * * * *

(e)–(f) [Reserved]

(g) Hospital cancellation of referral

center status. (1) A hospital may at any

time request cancellation of its status as

a referral center and be paid prospective

payments per discharge based on the

applicable rural rate as determined in

accordance with § 412.63, as adjusted by

the hospital’s area wage index value.

(2) The cancellation becomes effective

no later than 30 days after the date the

hospital submits its request.

(3) If a hospital requests that its

referral center status be canceled, it may

not be reclassified as a referral center

unless it meets the qualifying criteria set
Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations 46029

forth in paragraph (a) of this section in

effect at the time it reapplies.

* * * * *

14. In § 412.105, paragraphs (a) and

(d) are revised, paragraph (f) is removed,

paragraph (g) is redesignated as

paragraph (f), and a new paragraph (g)

is added. In redesignated paragraph (f),

paragraph (f)(1)(i) introductory text is

republished, paragraph (f)(1)(i)(B) is

revised, paragraph (f)(1)(ii) introductory

text is republished and paragraph

(f)(1)(ii)(C) is revised, paragraph

(f)(1)(iv) is revised, and a new paragraph

(f)(1)(v) is added, to read as follows:

§ 412.105 Special treatment: Hospitals that

incur indirect costs for graduate medical

education programs.

* * * * *

(a) Basic data. HCFA determines the

following for each hospital:

(1) The hospital’s ratio of full-time

equivalent residents, except as limited

under paragraph (f) of this section, to

the number of beds (as determined in

paragraph (b) of this section). For a

hospital’s cost reporting periods

beginning on or after October 1, 1997,

this ratio may not exceed the ratio for

the hospital’s most recent prior cost

reporting period.

(2) The hospital’s DRG revenue for

inpatient operating costs based on DRGadjusted prospective payment rates for

inpatient operating costs, excluding

outlier payments for inpatient operating

costs determined under subpart F of this

part and additional payments made

under the provisions of § 412.106 .

* * * * *

(d) Determination of education

adjustment factor. Each hospital’s

education adjustment factor is

calculated as follows:

(1) Step one. A factor representing the

sum of 1.00 plus the hospital’s ratio of

full-time equivalent residents to beds, as

determined under paragraph (a)(1) of

this section, is raised to an exponential

power equal to the factor set forth in

paragraph (c) of this section.

(2) Step two. The factor derived from

step one is reduced by 1.00.

(3) Step three. The factor derived from

completing steps one and two is

multiplied by ‘c’, and where ‘c’ is equal

to the following:

(i) For discharges occurring on or after

October 1, 1988, and before October 1,

1997, 1.89.

(ii) For discharges occurring during

fiscal year 1998, 1.72.

(iii) For discharges occurring during

fiscal year 1999, 1.6.

(iv) For discharges occurring during

fiscal year 2000, 1.47.

(v) For discharges occurring on or

after October 1, 2000, 1.35.

* * * * *

(f) Determining the total number of

full-time equivalent residents for cost

reporting periods beginning on or after

July 1, 1991. (1) For cost reporting

periods beginning on or after July 1,

1991, the count of full-time equivalent

residents for the purpose of determining

the indirect medical education

adjustment is determined as follows:

(i) The residents must be enrolled in

an approved teaching program. An

approved teaching program is one that

meets one of the following

requirements:

* * * * *

(B) May count towards certification of

the participant in a specialty or

subspecialty listed in the current edition

of either of the following publications:

(1) The Directory of Graduate Medical

Education Programs published by the

American Medical Association.

(2) The Annual Report and Reference

Handbook published by the American

Board of Medical Specialties.

* * * * *

(ii) In order to be counted, the

resident must be assigned to one of the

following areas:

* * * * *

(C) Effective for discharges occurring

on or after October 1, 1997, the time

spent by a resident in a nonhospital

setting in patient care activities under

an approved medical residency training

program is counted towards the

determination of full-time equivalency

if the criteria set forth at

§ 413.86(f)(1)(iii) are met.

* * * * *

(iv) Effective for discharges occurring

on or after October 1, 1997, the total

number of full-time equivalent residents

in the fields of allopathic and

osteopathic medicine in either a

hospital or nonhospital setting that

meets the criteria listed in paragraph

(f)(1)(ii) of this section may not exceed

the number of such full-time equivalent

residents in the hospital with respect to

the hospital’s most recent cost reporting

period ending on or before December

31, 1996.

(v) For a hospital’s cost reporting

periods beginning on or after October 1,

1997, and before October 1, 1998, the

total number of full-time equivalent

residents for payment purposes is equal

to the average of the actual full-time

equivalent resident counts (subject to

the requirements listed in paragraphs

(f)(1)(ii)(C) and (f)(1)(iv) of this section)

for that cost reporting period and the

preceding cost reporting period. For a

hospital’s cost reporting periods

beginning on or after October 1, 1998,

the total number of full-time equivalent

residents for payment purposes is equal

to the average of the actual full-time

equivalent resident count (subject to the

requirements listed in paragraphs

(f)(10)(ii)(C) and (f)(1)(iv) of this section)

for that cost reporting period and the

preceding two cost reporting periods.

* * * * *

(g) Indirect medical education

payment for managed care enrollees.

For portions of cost reporting periods

beginning on or after January 1, 1998, a

payment is made to a hospital for

indirect medical education costs, as

determined under paragraph (e) of this

section, for discharges associated with

individuals who are enrolled under a

risk-sharing contract with an eligible

organization under section 1876 of the

Act or with a Medicare+Choice

organization under title XVIII, Part C of

the Act during the period.

15. Section 412.106 is amended by

revising paragraphs (a)(2) and (d)(1) and

adding a new paragraph (e) to read as

follows:

§ 412.106 Special treatment: Hospitals that

serve a disproportionate share of lowincome patients.

(a) General considerations. * * *

* * * * *

(2) The payment adjustment is

applied to the hospital’s DRG revenue

for inpatient operating costs based on

DRG-adjusted prospective payment rates

for inpatient operating costs, excluding

outlier payments for inpatient operating

costs under subpart F of this part and

additional payments made under the

provisions of § 412.105.

* * * * *

(d) Payment adjustment.

(1) Method of adjustment. Subject to

the reduction factor set forth in

paragraph (e) of this section, if a

hospital serves a disproportionate

number of low-income patients, its DRG

revenues for inpatient operating costs

are increased by an adjustment factor as

specified in paragraph (d)(2) of this

section.

* * * * *

(e) Reduction in payments for FYs

1998 through 2002. The amounts

otherwise payable to a hospital under

paragraph (d) of this section are reduced

by the following:

(1) For FY 1998, 1 percent.

(2) For FY 1999, 2 percent.

(3) For FY 2000, 3 percent.

(4) For FY 2001, 4 percent.

(5) For FY 2002, 5 percent.

(6) For FYs 2003 and thereafter, 0

percent.

16. A new § 412.107 is added to read

as follows:
46030 Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations

§ 412.107 Special treatment: Hospitals that

receive an additional update for FYs 1998

and 1999.

(a) Additional payment update. A

hospital that meets the criteria set forth

in paragraph (b) of this section receives

the following increase to its applicable

percentage amount set forth in § 412.63

(p) and (q):

(1) For FY 1998, 0.5 percent.

(2) For FY 1999, 0.3 percent.

(b) Criteria for classification. A

hospital is eligible for the additional

payment update set forth in paragraph

(a) of this section if it meets all of the

following criteria:

(1) Definition. The hospital is not a

Medicare-dependent, small rural

hospital as defined in § 412.108(a) and

does not receive any additional payment

under the following provisions:

(i) The indirect medical education

adjustment made under § 412.105.

(ii) The disproportionate share

adjustment made under § 412.106.

(2) State criteria. The hospital is

located in a State in which the aggregate

payment made under § 412.112 (a) and

(c) for hospitals described in paragraph

(b)(1) of this section for their cost

reporting periods beginning in FY 1995

is less than the allowable operating

costs described in § 412.2(c) for those

hospitals.

(3) Hospital criteria. The aggregate

payment made to the hospital under

§ 412.112 (a) and (c) for the hospital’s

cost reporting period beginning in the

fiscal year in which the additional

payment update described in paragraph

(a) of this section is made is less than

the allowable operating cost described

in § 412.2(c) for that hospital.

17. In § 412.108 paragraph (a)(1) is

revised, the introductory text of

paragraphs (c) and (c)(2) are

republished, and the introductory text

of paragraph (c)(2)(ii) is revised to read

as follows:

§ 412.108 Special treatment: Medicaredependent, small rural hospitals.

(a) Criteria for classification as a

Medicare-dependent, small rural

hospital.

(1) General considerations. For cost

reporting periods beginning on or after

April 1, 1990 and ending before October

1, 1994, or beginning on or after October

1, 1997 and ending before October 1,

2001, a hospital is classified as a

Medicare-dependent, small rural

hospital if it is located in a rural area (as

defined in § 412.63(b)) and meets all of

the following conditions:

* * * * *

(c) Payment methodology. A hospital

that meets the criteria in paragraph (a)

of this section is paid for its inpatient

operating costs the sum of paragraphs

(c)(1) and (c)(2) of this section.

* * * * *

(2) The amount, if any, determined as

follows:

* * * * *

(ii) For discharges occurring during

any subsequent cost reporting period (or

portion thereof) and before October 1,

1994, and for discharges occurring on or

after October 1, 1997 and before October

1, 2001, 50 percent of the amount that

the Federal rate determined under

paragraph (c)(1) of this section is

exceeded by the higher of the following:

* * * * *

18. In § 412.109, paragraph (a) is

revised, paragraphs (c) and (d) are

removed, paragraphs (e), (f), and (g) are

redesignated as paragraphs (c), (d), and

(e), respectively, and redesignated

paragraphs (c)(3)(ii), (d), and (e) are

revised to read as follows:

§ 412.109 Special treatment: Essential

access community hospitals (EACHs).

(a) General rule. For payment

purposes, HCFA treats as a sole

community hospital any hospital that is

located in a rural area as described in

paragraph (b) of this section and that

HCFA designated as an EACH under

section 1820(i)(1) of the Act as in effect

on September 30, 1997, for as long as

the hospital continues to comply with

the terms, conditions, and limitations

that were applicable at the time HCFA

designated the hospital as an EACH.

The payment methodology for sole

community hospitals is set forth at

§ 412.92(d).

* * * * *

(c) Adjustment to the hospital-specific

rate for rural EACHs experiencing

increased costs.

* * * * *

(3) Intermediary recommendation.

* * *

(ii) The intermediary’s analysis and

recommendation of the request.

* * * * *

(d) Termination of EACH designation.

If HCFA determines that a hospital no

longer complies with the terms,

conditions, and limitations that were

applicable at the time HCFA designated

the hospital as an EACH, HCFA will

terminate the EACH designation of the

hospital, effective with discharges

occurring on or after 30 days after the

date of the determination.

(e) Review of HCFA determination. A

determination by HCFA that a hospital’s

EACH designation should be

terminated, is subject to review under

part 405, subpart R of this chapter,

including the time limits for filing

requests for hearings as specified in

§§ 405.1811(a) and 405.1841(a)(1) and

(b) of this chapter.

Subpart H—Payment to Hospitals

Under the Prospective Payment

Systems

19. Section 412.115 is amended by

revising paragraph (b) to read as follows:

§ 412.115 Additional payments.

* * * * *

(b) Administration of blood clotting

factor. For discharges occurring on or

after June 19, 1990, and before October

1, 1994, and for discharges occurring on

or after October 1, 1997, an additional

payment is made to a hospital for each

unit of blood clotting factor furnished to

a Medicare inpatient who is a

hemophiliac.

* * * * *

Subpart K—Prospective Payment

System for Inpatient Operating Costs

for Hospitals Located in Puerto Rico

20. Section 412.204 is revised to read

as follows:

§ 412.204 Payment to hospitals located in

Puerto Rico.

(a) FY 1988 through FY 1997. For

discharges occurring on or after October

1, 1997, payments for inpatient

operating costs to hospitals located in

Puerto Rico that are paid under the

prospective payment system are equal to

the sum of—

(1) 75 percent of the Puerto Rico

prospective payment rate for inpatient

operating costs, as determined under

§ 412.208 or § 412.210; and

(2) 25 percent of a national

prospective payment rate for inpatient

operating costs, as determined under

§ 412.212.

(b) FY 1998 and thereafter. For

discharges occurring on or after October

1, 1997, payments for inpatient

operating costs to hospitals located in

Puerto Rico that are paid under the

prospective payment system are equal to

the sum of—

(1) 50 percent of the Puerto Rico

prospective payment rate for inpatient

operating costs, as determined under

§ 412.208 or § 412.210; and

(2) 50 percent of a national

prospective payment rate for inpatient

operating costs, as determined under

§ 412.212.

§ 412.210 [Amended]

21. In § 412.210(e), the phrase ‘‘the

national average hospital wage level’’ is

revised to read ‘‘the Puerto Rico average

hospital wage level’’.
Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations 46031

Subpart L—The Medicare Geographic

Classification Review Board

22. Section 412.230 is amended by

revising paragraphs (a)(5)(ii), (e)(1)

introductory text, and (e)(1)(iv)(B) and

adding new paragraphs (e)(3) and (e)(4),

to read as follows:

§ 412.230 Criteria for an individual hospital

seeking redesignation to another rural area

or an urban area.

(a) * * *

(5) * * *

(ii) For redesignations effective in

fiscal years 1997 and 1998 and 2002 and

thereafter, a hospital may not be

redesignated for purposes of the

standardized amount if the area to

which the hospital seeks redesignation

does not have a higher standardized

amount than the standardized amount

the hospital currently receives.

* * * * *

(e) Use of urban or other rural area’s

wage index.—(1) Criteria for use of

area’s wage index. Except as provided

in paragraphs (e)(3) and (e)(4) of this

section, to use an area’s wage index, a

hospital must demonstrate the

following:

* * * * *

(iv) One of the following conditions

apply:

* * * * *

(B) For redesignations effective before

fiscal year 1999, the hospital’s average

hourly wage weighted for occupational

categories is at least 90 percent of the

average hourly wages of hospitals in the

area to which it seeks redesignation.

* * * * *

(3) Rural referral center exception. If

a hospital is a rural referral center, it

does not have to demonstrate that it

meets the criterion set forth in

paragraph (e)(1)(iii) of this section

concerning its average hourly wage.

(4) Special dominating hospital

exception. The requirements of

paragraph (e)(1)(i) and (e)(1)(iii) of this

section do not apply if a hospital meets

the following criteria:

(i) Its average hourly wage is at least

108 percent of the average hourly wage

of all other hospitals in the area in

which the hospital is located.

(ii) It pays at least 40 percent of the

adjusted uninflated wages in the MSA.

(iii) It was approved for redesignation

under this paragraph (e) for each year

from fiscal year 1992 through fiscal year

1997.

23. Section 412.232 is amended by

revising paragraph (c)(2) to read as

follows:

§ 412.232 Criteria for all hospitals in a rural

county seeking urban redesignation.

* * * * *

(c) Wage criteria. * * *

(2) Aggregate hourly wage weighted

for occupational mix. For redesignations

effective before fiscal year 1999, the

aggregate hourly wage for all hospitals

in the rural county, weighted for

occupational categories, is at least 90

percent of the average hourly wage in

the adjacent urban area.

* * * * *

24. Section 412.234 is amended by

revising paragraph (b)(2) to read as

follows:

§ 412.234 Criteria for all hospitals in an

urban county seeking redesignation to

another urban area.

* * * * *

(b) Wage criteria. * * *

(2) Aggregate hourly wage weighted

for occupational mix. For redesignations

effective before fiscal year 1999, the

aggregate average hourly wage for all

hospitals in the county, weighted for

occupational categories, is at least 90

percent of the average hourly wage in

the adjacent urban area.

* * * * *

25. In § 412.256, paragraphs (a)(2) and

(c)(1) are revised to read as follows:

§ 412.256 Application requirements.

(a) * * *

(2) A complete application must be

received not later than the first day of

the month preceding the Federal fiscal

year for which reclassification is

requested.

* * * * *

(c) Opportunity to complete a

submitted application. (1) The MGCRB

will review an application within 15

days of receipt to determine if the

application is complete. If the MGCRB

determines that an application is

incomplete, the MGCRB will notify the

hospital, with a copy to HCFA, within

the 15 day period, that it has

determined that the application is

incomplete and may dismiss the

application if a complete application is

not filed by September 1 .

* * * * *

26. Section 412.274 is amended by

revising paragraph (b) to read as follows:

§ 412.274 Scope and effect of an MGCRB

decision.

* * * * *

(b) Effective date and term of the

decision. Any classification change is

effective for one year beginning with

discharges occurring on the first day

(October 1) of the second Federal fiscal

year following the Federal fiscal year in

which the complete application is filed

and ending effective at the end of that

Federal fiscal year (the end of the next

September 30).

* * * * *

Subpart M—Prospective Payment

System for Inpatient Hospital Capital

Costs

27. Section 412.308 is amended by

adding new paragraphs (b)(4) and (b)(5)

to read as follows:

§ 412.308 Determining and updating the

Federal rate.

* * * * *

(b) Standard Federal rate. * * *

(4) Effective FY 1998, the unadjusted

standard Federal capital payment rate in

effect on September 30, 1997, used to

determine the Federal rate each year

under paragraph (c) of this section is

reduced by 15.68 percent.

(5) For discharges occurring on or

after October 1, 1997 through September

30, 2002, the unadjusted standard

Federal capital payment rate as in effect

on September 30, 1997, used to

determine the Federal rate each year

under paragraph (c) of this section is

further reduced by 2.1 percent.

* * * * *

28. Section 412.328 is amended by

revising paragraph (e)(4) and adding

new paragraphs (e)(5) and (e)(6) to read

as follows:

§ 412.328 Determining and updating the

hospital-specific rate.

* * * * *

(e) Hospital-specific rate. * * *

(4) Payment for transfer cases.

Effective FY 1996, the intermediary

reduces the updated amount determined

in paragraph (d) of this section by 0.28

percent to account for the effect of the

revised policy for payment of transfers

under § 412.4(d).

(5) Reduction of rate: FY 1998.

Effective FY 1998, the unadjusted

hospital-specific rate as in effect on

September 30, 1997 described in

paragraph (e)(1) of this section is

reduced by 15.68 percent.

(6) Reduction of rate: FY 1998 through

FY 2002. For discharges occurring on or

after October 1, 1997 through September

30, 2002, the unadjusted hospitalspecific rate in effect on September 30,

1997, described in paragraph (e)(1) of

this section is further reduced by 2.1

percent.

* * * * *

29. Section 412.348 is amended by

revising paragraph (c)(2) to read as

follows:

§ 412.348 Exception payments.

* * * * *
46032 Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations

(c) Minimum payment level by class

of hospital.

* * * * *

(2) When it is necessary to adjust the

minimum payment levels set by class of

hospitals specified in paragraphs

(c)(1)(i) and (g)(6) of this section, HCFA

will adjust those levels for each class of

hospitals in one percentage point

increments as necessary to satisfy the

requirement specified in paragraph (h)

of this section that total estimated

payments under the exception process

not exceed 10 percent of the total

estimated capital prospective payments

(exclusive of hold-harmless payments

for old capital) for the same fiscal year.

* * * * *

30. Section 412.374 is revised to read

as follows:

§ 412.374 Payments to hospitals located in

Puerto Rico.

(a) Payments for capital-related costs

to hospitals located in Puerto Rico that

are paid under the prospective payment

system are equal to the sum of the

following:

(1) 50 percent of a Puerto Rico capital

rate based on data from Puerto Rico

hospitals only, which is determined in

accordance with procedures for

developing the Federal rate; and

(2) 50 percent of the Federal rate, as

determined under § 412.308.

(b) Effective for fiscal year 1998, the

Puerto Rico capital rate described in

paragraph (a) of this section in effect on

September 30, 1997, is reduced by 15.68

percent.

(c) For discharges occurring on or

after October 1, 1997 through September

30, 2002, the Puerto Rico capital rate

described in paragraph (a) of this

section in effect on September 30, 1997

is further reduced by 2.1 percent.

E. Part 413 is amended as set forth

below:

PART 416—PRINCIPLES OF

REASONABLE COST

REIMBURSEMENT; PAYMENT FOR

END-STAGE RENAL DISEASE

SERVICES; OPTIONAL

PROSPECTIVELY DETERMINED

PAYMENT RATES FOR SKILLED

NURSING FACILITIES

1. The authority citation for Part 413

continues to read as follows:

Authority: Secs. 1102, 1861(v)(1)(A), and

1871 of the Social Security Act (42 U.S.C.

1302, 1395x(v)(1)(A), and 1395hh).

2. Section 413.1 is amended by

revising paragraph (a)(1)(ii)(G) to read as

follows:

§ 413.1 Introduction.

(a) * * *

(ii) * * *

(G) Section 1834(g) of the Act

provides that payment for critical access

hospital (CAH) outpatient services is the

reasonable costs of the CAH in

providing these services, as determined

in accordance with section

1861(v)(1)(A) of the Act and the

applicable principles of cost

reimbursement in this part and in part

415 of this chapter.

* * * * *

§ 413.13 [Amended]

3. In § 413.13, paragraph (c)(2)(iv) is

removed.

4. Section 413.40 is amended by

adding new paragraphs (b)(1)(iv) and

(b)(1)(v); revising paragraph (c)(3)(vi)

and adding new paragraphs (c)(3)(vii)

and (c)(3)(viii); revising paragraph (c)(4);

revising paragraphs (d)(2) and (d)(3) and

adding new paragraphs (d)(4)and (d)(5);

revising paragraphs (f)(1), (f)(2), (g)(1),

and (g)(5); and adding a new paragraph

(j), to read as follows:

§ 413.40 Ceiling on the rate of increase in

hospital inpatient costs.

* * * * *

(b) Cost reporting periods subject to

the rate-of-increase ceiling. (1) * * *

(iv) Request for rebased target amount

for the cost reporting period beginning

on or after October 1, 1997 and on or

before September 30, 1998. Except for

qualified long-term care hospitals as

defined in paragraph (b)(1)(v) of this

section, each hospital or unit under

present or previous ownership that

received payment under section 1886(b)

of the Act during cost reporting periods

beginning before October 1, 1990, may

submit a request to its fiscal

intermediary to rebase its target amount.

The request must be received by the

fiscal intermediary by the later of

November 1, 1997 or 60 days before the

beginning of its cost reporting period

beginning during fiscal year 1998. The

rebased target amount for the cost

reporting period beginning during fiscal

year 1998 is determined as follows:

(A) Determine the hospital’s inpatient

operating costs per case for each of the

five most recent settled cost reports as

of August 5, 1997.

(B) For each of the five cost reports,

update the operating costs per case by

the applicable update factors up to the

hospital’s cost reporting period

beginning during FY 1998.

(C) Exclude the highest and lowest of

the five updated amounts determined

under paragraph (b)(1)(iv)(B) of this

section.

(D) Compute the average for the

remaining three updated amounts for

operating cost per case.

(v) Request by qualified long-term

care hospital. A qualified long-term care

hospital may file a request to its fiscal

intermediary for a rebased FY 1998

target amount. The request must be

received by the fiscal intermediary by

the later of November 1, 1997 or 60 days

before the beginning of its cost reporting

period beginning during fiscal year

1998. The rebased FY 1998 target

amount is the hospital’s FY 1996

inpatient operating costs updated to FY

1997. A qualified long-term care

hospital means a long-term care hospital

that meets the following two conditions

for its two most recent settled cost

reports as of August 5, 1997:

(A) Its Medicare inpatient operating

costs exceed 115 percent of the ceiling.

(B) The hospital would have had a

disproportionate patient percentage (as

defined in § 412.106) equal to or greater

than 70 percent if it were a prospective

payment hospital.

* * * * *

(c) Costs subject to the ceiling.

* * * * *

(3) Rate-of-increase percentages and

update factors. * * *

(vi) Federal fiscal year 1998. The

applicable rate-of-increase percentage

for cost reporting periods beginning on

or after October 1, 1997 is 0 percent.

(vii) Federal fiscal year 1999 through

Federal fiscal year 2002. The applicable

rate-of-increase percentage for cost

reporting periods beginning on or after

October 1, 1998, and before October 1,

2002, based on data from the most

recent available cost report, is:

(A) The percentage increase in the

market basket, if inpatient operating

costs are equal to or exceed the ceiling

amount by 10 percent or more of the

ceiling.

(B) The percentage increase in the

market basket minus .25 percentage

points for each percentage point by

which inpatient operating costs are less

than 10 percent over the ceiling (but not

less than 0), if inpatient operating costs

exceed the ceiling by less than 10

percent of the ceiling.

(C) The greater of the percentage

increase in the market basket minus 2.5

percentage points or 0 percent, if

inpatient operating costs are equal to or

less than the ceiling but greater than

66.7 percent of the ceiling.

(D) 0 percent, if inpatient operating

costs do not exceed 66.7 percent of the

ceiling.

(viii) Federal fiscal year 2003 and

following. The applicable rate-ofincrease percentage for cost reporting

periods beginning on or after October 1,

2002, is the percentage increase

projected by the hospital market basket

index.
Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations 46033

(4) Target amount. The intermediary

will establish a target amount for each

hospital. The target amount for a cost

reporting period is determined as

follows:

(i) Except as provided in paragraph

(c)(4)(iv) of this section, and subject to

the provisions of paragraph (c)(4)(iii) of

this section, for the first cost reporting

period to which this ceiling applies, the

target amount equals the hospital’s

allowable net inpatient operating costs

per case for the hospital’s base period

increased by the update factor for the

subject period.

(ii) Subject to the provisions of

paragraph (c)(4)(iii) of this section, for

subsequent cost reporting periods, the

target amount equals the hospital’s

target amount for the previous cost

reporting period increased by the

update factor for the subject cost

reporting period, unless the provisions

of paragraph (c)(5)(ii) of this section

apply.

(iii) In the case of a psychiatric

hospital or unit, rehabilitation hospital

or unit, or long term care hospital, the

target amount may not exceed—

(A) For cost reporting periods

beginning during fiscal year 1998, the

75th percentile of target amounts for

hospitals in the same class (psychiatric

hospital or unit, rehabilitation hospital

or unit, or long term care hospital) for

cost reporting periods ending during FY

1996, increased by the applicable

market basket percentage up to the first

cost reporting period beginning on or

after October 1, 1997.

(B) For cost reporting periods

beginning during FYs 1999 through

2002, the amount determined under

paragraph (c)(4)(iii)(A) increased by the

market basket percentage increase up

through the subject period, subject to

paragraph (c)(4)(iv) of this section.

(iv) In the case of a hospital that

received payments under paragraph

(f)(2)(ii) of this section, for purposes of

determining the hospital’s target amount

for the hospital’s third 12-month cost

reporting period, the target amount for

the preceding cost reporting period is

equal to the amount determined under

paragraph (f)(2)(ii)(A) of this section.

* * * * *

(d) Application of the target amount

in determining the amount of payment.

* * *

(2) Net inpatient operating costs are

less than or equal to the ceiling. For cost

reporting periods beginning on or after

October 1, 1997, if a hospital’s allowable

net inpatient operating costs do not

exceed the hospital’s ceiling, payment

to the hospital will be determined on

the basis of the lower of the—

(i) Net inpatient operating costs plus

15 percent of the difference between

inpatient operating costs and the

ceiling; or

(ii) Net inpatient operating costs plus

2 percent of the ceiling.

(3) Net inpatient operating costs are

greater than the ceiling. For cost

reporting periods beginning on or after

October 1, 1997—

(i) If a hospital’s allowable net

inpatient operating costs do not exceed

110 percent of the ceiling (or the

adjusted ceiling, if applicable), payment

will be the ceiling (or the adjusted

ceiling, if applicable);

(ii) If a hospital’s allowable net

inpatient operating costs are greater

than 110 percent of the ceiling (or the

adjusted ceiling, if applicable), payment

will be the ceiling (or the adjusted

ceiling, if applicable) plus the lesser of:

(A) 50 percent of the allowable net

inpatient operating costs in excess of

110 percent of the ceiling (or the

adjusted ceiling, if applicable); or

(B) 10 percent of the ceiling (or the

adjusted ceiling, if applicable).

(4) Continuous improvement bonus

payments. For cost reporting periods

beginning on or after October 1, 1997,

eligible hospitals (as defined in

paragraph (d)(5) of this section) receive

payments in addition to those in

paragraph (d)(2) of this section, as

applicable. These payments are equal to

the lesser of—

(i) 50 percent of the amount by which

the operating costs are less than the

expected costs for the period; or

(ii) 1 percent of the ceiling.

(5) Eligibility requirements for

continuous improvement bonus

payments. To qualify, a hospital must

have been paid as a prospective

payment excluded hospital for at least

three full cost reporting periods prior to

the applicable period, and the hospital’s

operating costs per discharge for the

period must be less than the least of the

following:

(i) The hospital’s target amount.

(ii) The hospital’s trended costs.

(A) For a hospital for which its cost

reporting period ending during fiscal

year 1996 was its third or subsequent

full cost reporting period, trended costs

are the lesser of the allowable inpatient

operating costs per discharge or the

target amount for the cost reporting

period ending in fiscal year 1996,

increased in a compounded manner for

each succeeding fiscal year by the

market basket percentage increase;

(B) For all other hospitals, trended

costs are the allowable inpatient

operating costs per discharge for its

third full cost reporting period

increased in a compounded manner for

each succeeding fiscal year by the

market basket increase.

(iii) The hospital’s expected costs.

The hospital’s expected costs are the

lesser of its allowable inpatient

operating costs per discharge or the

target amount for the previous cost

reporting period, updated by the market

basket percentage increase for the fiscal

year.

* * * * *

(f) Comparison to the target amount

for new hospitals and units—(1) New

hospitals and units—(i) New hospitals.

For purposes of this section, a new

hospital is a provider of hospital

inpatient services that—

(A) Has operated as the type of

hospital for which HCFA granted it

approval to participate in the Medicare

program, under present or previous

ownership (or both), for less than 2 full

years; and

(B) Has provided the type of hospital

inpatient services for which HCFA

granted it approval to participate in the

Medicare program, for less than 2 years.

(ii) New units. A newly established

unit that is excluded from the

prospective payments system under the

provisions of §§ 412.25 through 412.30

of this chapter does not qualify for the

exemption afforded to a new hospital

under paragraph (f)(2)(i) of this section

unless the unit is located in an acute

care hospital that, if it were subject to

the provisions of this section, would

qualify as a new hospital under

paragraph (f)(1)(i) of this section.

(2) Comparison—(i) Exemptions. (A)

A new children’s hospital is exempt

from the rate-of-increase ceiling

imposed under this section. The

exemption begins when the hospital

accepts its first patient and ends at the

end of the first cost reporting period

ending at least 2 years after the hospital

accepts its first patient. The first cost

reporting period of at least 12 months

beginning at least 1 year after the

hospital accepts its first patient is the

base year, in accordance with paragraph

(b) of this section.

(B) Within 180 days of the date a

hospital is excluded from the

prospective payment system, the

intermediary determines whether the

hospital is exempt from the rate-ofincrease ceiling. The intermediary

notifies the hospital of its determination

and the hospital’s base period.

(C) A decision issued under paragraph

(f)(2)(ii)(B) of this section is considered

final unless the hospital submits

additional information and requests a

review of the decision no later than 180

days after the date on the intermediary’s

notice of the decision. The final
46034 Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations

decision is subject to review under

subpart R of part 405 of this chapter,

provided the hospital has received a

notice of program reimbursement (NPR)

for the cost reporting period in question

and the NPR does not reflect an

exemption (see the definitions in

§ 405.1801(a) of this chapter and the

provisions regarding a provider’s right

to a Board hearing in § 405.1835 of this

chapter).

(ii) Median target amount. (A) For

cost reporting periods beginning on or

after October 1, 1997, the amount of

payment for a new psychiatric hospital

or unit, a new rehabilitation hospital or

unit, or a new long-term care hospital

that was not paid as an excluded

hospital prior to October 1, 1997, is the

lower of the hospital’s net inpatient

operating costs per case or 110 percent

of the national median of the target

amounts for the class of excluded

hospitals and units (psychiatric,

rehabilitation, long-term care) as

adjusted and updated. This

methodology applies to the hospital’s

first two 12-month cost reporting

periods.

(B) The national median of the target

amounts is the FY 1996 median target

amount—

(1) Adjusted to account for differences

in area wage levels;

(2) Updated by the market basket

percentage increase to the fiscal year in

which the hospital first received

payments as an excluded provider.

* * * * *

(g) Adjustments.—(l) General rule.

HCFA may adjust the amount of the

operating costs considered in

establishing the rate-of-increase ceiling

for one or more cost reporting periods,

including both periods subject to the

ceiling and the hospital’s base period,

under the circumstances specified

below. When an adjustment is requested

by the hospital, HCFA makes an

adjustment only to the extent that the

hospital’s operating costs are

reasonable, attributable to the

circumstances specified separately

identified by the hospital, and verified

by the intermediary. HCFA may grant an

adjustment requested by the hospital

only if a hospital’s operating costs

exceed the rate-of-increase ceiling

imposed under this section. The amount

of payment made to a hospital after an

adjustment under paragraph (g) of this

section is based on the difference

between the hospital’s operating costs

and 110 percent of the ceiling.

* * * * *

(5) Adjustment limitations. For cost

reporting periods beginning on or after

October 1, 1993, and before October 1,

2003, the payment reductions under

paragraph (c)(3)(v) through (c)(3)(vii) of

this section will not be considered when

determining adjustments under this

paragraph.

* * * * *

(j) Reduction to capital-related costs.

For psychiatric hospitals and units,

rehabilitation hospitals and units, and

long-term hospitals, the amount

otherwise payable for capital-related

costs is reduced by 15 percent for

portions of cost reporting periods

occurring on or after October 1, 1997,

through September 30, 2002.

5. Section 413.70 is revised to read as

follows:

§ 413.70 Payment for services of a CAH.

Payment for inpatient and outpatient

services of a CAH is the reasonable costs

of the CAH in providing such services,

as determined in accordance with

section 1861(v)(1)(A) of the Act and the

applicable principles of cost

reimbursement in this part and in part

415 of this chapter.

Subpart F—Specific Categories of

Costs

6. In § 413.86, the introductory text of

paragraph (b) is republished, paragraph

(b) is amended by adding the definition

of ‘‘Affiliated group’’ in alphabetical

order, paragraph (d)(3) is redesignated

as paragraph (d)(5) and redesignated

paragraph (d)(5) is revised, new

paragraphs (d)(3) and (d)(4) are added,

paragraph (e)(4)(i)(B) is revised, the

introductory text of paragraph (g)(1) is

amended by adding a sentence to the

end, and new paragraphs (g)(4), (g)(5),

(g)(6) and (g)(7) are added, to read as

follows:

§ 413.86 Direct graduate medical

education payments.

* * * * *

(b) Definitions. For purposes of this

section, the following definitions apply:

Affiliated group means two or more

hospitals located in the same geographic

wage area (as that term is used under

part 412 of this subchapter for the

prospective payment system) in which

individual residents work at each of the

hospitals seeking to be treated as an

affiliated group during the course of the

approved program; or, if the hospitals

are not located in the same geographic

wage area, the hospitals are jointly

listed as major participating institutions

for one or more programs as that term

is used in Graduate Medical Education

Directory, 1997–1998.

* * * * *

(d) Calculating payment for graduate

medical education costs. * * *

(3) Step three. For portions of cost

reporting periods beginning on or after

January 1, 1998, the product derived in

step one is multiplied by the proportion

of the hospital’s inpatient days

attributable to individuals who are

enrolled under a risk-sharing contract

with an eligible organization under

section 1876 of the Act and who are

entitled to Medicare Part A or with a

Medicare+Choice organization under

Title XVIII, Part C of the Act. This

amount is multiplied by an applicable

payment percentage equal to—

(i) 20 percent for 1998;

(ii) 40 percent for 1999;

(iii) 60 percent in 2000;

(iv) 80 percent in 2001; and

(v) 100 percent in 2002 and

subsequent years.

(4) Step four. Add the results of steps

2 and 3.

(5) Step five. The product derived in

step two is apportioned between Part A

and Part B of Medicare based on the

ratio of Medicare’s share of reasonable

costs excluding graduate medical

education costs attributable to each part

as determined through the Medicare

cost report.

* * * * *

(e) Determining per resident amounts

for the base period. * * *

(4) Exceptions. (i) Base period for

certain hospitals.

* * * * *

(B) The mean value of per resident

amounts of hospitals located in the

same geographic wage area, as that term

is used in the prospective payment

system under part 412 of this chapter,

for cost reporting periods beginning in

the same fiscal years. If there are fewer

than three amounts that can be used to

calculate the mean value, the

calculation of the per resident amounts

includes all hospitals in the hospital’s

region as that term is used in

§ 412.62(f)(1)(i).

* * * * *

(g) Determining the weighted number

of FTE residents. * * *

(1) * * * If the resident is enrolled in

a combined medical residency training

program in which all of the individual

programs (that are combined) are for

training primary care residents (as

defined in paragraph (b) of this section)

or obstetrics and gynecology residents,

the initial residency period is the time

required for individual certification in

the longer of the programs plus one

year.

* * * * *

(4) For purposes of determining direct

graduate medical education payment,

for cost reporting periods beginning on

or after October 1, 1997, a hospital’s
Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations 46035

unweighted FTE count for residents in

allopathic and osteopathic medicine

may not exceed the hospital’s

unweighted FTE count for these

residents for the most recent cost

reporting period ending on or before

December 31, 1996. If the hospital’s

number of FTE residents in a cost

reporting period beginning on or after

October 1, 1997, exceeds the limit

described in this paragraph (g), the

hospital’s weighted FTE count (before

application of the limit) will be reduced

in the same proportion that the number

of FTE residents for that cost reporting

period exceeds the number of FTE

residents for the most recent cost

reporting period ending on or before

December 31, 1996. Hospitals that are

part of the same affiliated group may

elect to apply the limit on an aggregate

basis. The fiscal intermediary may make

appropriate modifications to apply the

provisions of this paragraph (g)(4) based

on the equivalent of a 12-month cost

reporting period.

(5) For purposes of determining direct

graduate medical education payment,

for the hospital’s first cost reporting

period beginning on or after October 1,

1997, the hospital’s weighted FTE count

is equal to the average of the weighted

FTE count for the payment year cost

reporting period and the preceding cost

reporting period. For cost reporting

periods beginning on or after October 1,

1998, the hospital’s weighted FTE count

is equal to the average of the weighted

FTE count for the payment year cost

reporting period and the preceding two

cost reporting periods. The fiscal

intermediary may make appropriate

modifications to apply the provisions of

this paragraph based on the equivalent

of 12-month cost reporting periods.

(6) If a hospital established a new

medical residency training program as

defined in this paragraph (g) after

January 1, 1995, the hospital’s FTE cap

described under paragraph (g)(4) of this

section may be adjusted as follows:

(i) If a hospital had no residents

before January 1, 1995, and it

establishes a new medical residency

training program on or after that date,

the hospital’s unweighted FTE resident

cap under paragraph (g)(4) of this

section may be adjusted based on the

product of the number of first year

residents in the program in the third

year of the program’s existence and the

number of years in which residents are

expected to complete that program

based on the minimum accredited

length for the type of program. For these

hospitals, the cap will only be adjusted

based on the first program (or programs,

if established simultaneously) beginning

on or after January 1, 1995. The cap will

not be revised for programs

subsequently established.

(ii) If a hospital had residents in its

most recent cost reporting period ending

before January 1, 1995, the hospital’s

unweighted FTE cap may be adjusted

for new medical residency training

programs established on or after January

1, 1995 and August 5, 1997. Increases in

the hospital’s FTE resident limit are

permitted for the new program based on

the product of the number of first-year

residents in the third year of the newly

established program and the number of

years in which residents are expected to

complete each program based on the

minimum accredited length for the type

of program. The hospital’s unweighted

FTE limit for a cost reporting period

may be adjusted to reflect the number of

residents in its most recent cost

reporting period ending on or before

December 31, 1996 and up to the

incremental increase in its FTE count

only for the newly established

programs.

(iii) If a hospital with residents in its

most recent cost reporting period ending

on or before January 1, 1995, is located

in a rural area (or other hospitals located

in rural areas which added residents

under paragraph (g)(6)(i) of this section),

the hospital’s unweighted FTE limit

may be adjusted in the same manner

described in paragraph (g)(6)(ii) of this

section to reflect the increase for

residents in the new medical residency

training programs established after

August 5, 1997. For these hospitals, the

limit will be adjusted for additional new

programs but not for expansions of

existing or previously existing

programs.

(iv) A hospital seeking an adjustment

to the limit on its unweighted resident

count policy must provide

documentation to its fiscal intermediary

justifying the adjustment.

(7) For purposes of paragraph (g) of

this section, new medical residency

training program means a medical

residency training program that receives

initial accreditation by the appropriate

accrediting body on or after July 1, 1995.

* * * * *

F. Part 424 is amended as set forth

below:

PART 424—CONDITIONS FOR

MEDICARE PAYMENT

1. The authority citation for Part 424

continues to read as follows:

Authority: Section 1102 and 1871 of the

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

1395hh).

2. In § 424.1(a)(1), the introductory

text is republished and a new statutory

citation is added in numerical order, to

read as follows:

§ 424.1 Basis and scope.

(a) Statutory basis. (1) This part is

based on the indicated provisions of the

following sections of the Act:

* * * * *

1820—Conditions for designating certain

hospitals as critical assess hospitals.

* * * * *

3. In § 424.15, the section heading and

paragraph (a) are revised to read as

follows:

§ 424.15 Requirements for inpatient CAH

services.

(a) Content of certification. Medicare

Part A pays for inpatient CAH services

only if a physician certifies that the

individual may reasonably be expected

to be discharged or transferred to a

hospital within 96 hours after admission

to the CAH.

* * * * *

H. Part 485 is amended as set forth

below:

PART 485—CONDITIONS OF

PARTICIPATION: SPECIALIZED

PROVIDERS

1. The authority citation for Part 485

continues to read as follows:

Authority: Secs. 1102 and 1871 of the

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

1395hh).

2. The heading for Subpart F is

revised to read as follows:

Subpart F—Conditions of

Participation: Critical Access Hospitals

(CAHs)

3. In § 485.603, the introductory text

is republished, paragraphs (a)(1) and

(a)(2) are revised, and a new paragraph

(c) is added to read as follows:

§ 485.603 Rural health network.

A rural health network is an

organization that meets the following

specifications:

(a) It includes—

(1) At least one hospital that the State

has designated or plans to designate as

a CAH; and

(2) At least one hospital that furnishes

acute care services.

* * * * *

(c) Each CAH that is a member of the

rural health network has an agreement

with respect to credentialing and quality

assurance with at least—

(1) One hospital that is a member of

the network

(2) One PRO or equivalent entity; or

(3) One other appropriate and

qualified entity identified in the State

rural health care plan.
46036 Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations

4. Section 485.606 is revised to read

as follows:

§ 485.606 Designation of CAHs.

(a) Criteria for State designation. (1) A

State that has established a Medicare

rural hospital flexibility program

described in section 1820(c) of the Act

may designate one or more facilities as

CAHs if each facility meets the CAH

conditions of participation in this

subpart F.

(2) The State must not deny any

hospital that is otherwise eligible for

designation as a CAH under this

paragraph (a) solely because the hospital

has entered into an agreement under

which the hospital may provide

posthospital SNF care as described in

§ 482.66 of this chapter.

(b) Criteria for HCFA designation.

HCFA designates a facility as a CAH if—

(1) The facility is designated as a CAH

by the State in which it is located; or

(2) The facility is a medical assistance

facility operating in Montana or a rural

primary care hospital designated by

HCFA before August 5, 1997, and is

otherwise eligible to be designated as a

CAH by the State under the rules in this

subpart.

5. Section 485.610 is revised to read

as follows:

§ 485.610 Condition of participation:

Status and location.

(a) Standard: Status. The facility is a

public or nonprofit hospital.

(b) Standard: Location. The CAH

meets the following requirements:

(1) The CAH is located outside any

area that is a Metropolitan Statistical

Area, as defined by the Office of

Management and Budget, or that has

been recognized as urban under the

regulations in § 412.62(f) of this chapter.

(2) The CAH is not deemed to be

located in an urban area under

§ 412.63(b) of this chapter.

(3) The CAH has not been classified

as an urban hospital for purposes of the

standardized payment amount by HCFA

or the Medicare Geographic

Classification Review Board under

§ 412.230(e) of this chapter, and is not

among a group of hospitals that have

been redesignated to an adjacent urban

area under § 412.232 of this chapter.

(4) The CAH is located more than a

35-mile drive (or, in the case of

mountainous terrain or in areas with

only secondary roads available, a 15-

mile drive) from a hospital or another

CAH, or the CAH is certified by the

State as being a necessary provider of

health care services to residents in the

area.

6. Section 485.612 is revised to read

as follows:

§ 485.612 Condition of participation:

Compliance with hospital requirements at

time of application.

The hospital has a provider agreement

to participate in the Medicare program

as a hospital at the time the hospital

applies for designation as a CAH.

7. Section 485.614 is removed.

8. Section 485.616 is revised to read

as follows:

§ 485.616 Condition of participation:

Agreements.

(a) Standard: Agreements with

network hospitals. In the case of a CAH

that is a member of a rural health

network as defined in § 485.603 of this

chapter, the CAH has in effect an

agreement with at least one hospital that

is a member of the network for—

(1) Patient referral and transfer;

(2) The development and use of

communications systems of the

network, including the network’s

system for the electronic sharing of

patient data, and telemetry and medical

records, if the network has in operation

such a system; and

(3) The provision of emergency and

nonemergency transportation between

the facility and the hospital.

(b) Standard: Agreements for

credentialing and quality assurance.

Each CAH that is a member of a rural

health network shall have an agreement

with respect to credentialing and quality

assurance with at least—

(1) One hospital that is a member of

the network;

(2) One PRO or equivalent entity; or

(3) One other appropriate and

qualified entity identified in the State

rural health care plan.

9. Section 485.620 is revised to read

as follows:

§ 485.620 Condition of participation:

Number of beds and length of stay.

(a) Standard: Number of beds. Except

as permitted for CAHs having swing-bed

agreements under § 485.645 of this

chapter, the CAH maintains no more

than 15 inpatient beds.

(b) Standard: Length of stay. The CAH

discharges or transfers each inpatient

within 96 hours after admission, unless

a longer period is required because

transfer to a hospital is precluded

because of inclement weather or other

emergency conditions. A PRO or

equivalent entity may also, on request,

waive the 96-hour restriction on a caseby-case basis.

10. In § 485.623, the address under

paragraphs (d)(1) and (d)(2) ‘‘HCFA

Information Resource Center, 6325

Security Boulevard, Room G–10–A East

High Rise Building, Baltimore, MD

21207’’ is revised to read ‘‘HCFA

Information Resource Center, 7500

Security Boulevard, Room C2–07–13,

Central Building, Baltimore, MD 21244–

1850’’.

11. In § 485.645, the section heading,

the introductory text, paragraphs (a) and

the first sentence of the introductory

text of paragraph (b) are revised to read

as follows:

§ 485.645 Special requirements for CAH

providers of long-term care services

(‘‘swing-beds’’).

A CAH must meet the following

requirements in order to be granted an

approval from HCFA to provide posthospital SNF care, as specified in

§ 409.30 of this chapter, and to be paid

for SNF-level services, in accordance

with paragraph (b) of this section.

(a) Eligibility. A CAH must meet the

following eligibility requirements:

(1) Effective October 1, 1997, a facility

that, at the time it applied to the State

for designation as a CAH, had an

agreement in effect under § 482.66 of

this chapter may continue to use its

inpatient facilities for the provision of

post-hospital SNF care, so long as the

total number of beds that are used at any

time for the furnishing of either such

services or acute care inpatient services

does not exceed 25 beds and the number

of beds used at any time for acute care

inpatient services does not exceed 15

beds.

(2) Notwithstanding paragraph (a)(1)

of this section, a CAH that participated

in Medicare as a rural primary care

hospital (RPCH) on September 30, 1997

and on that date had in effect an

approval from HCFA to use its inpatient

facilities to provide post-hospital SNF

care may continue in that status under

the same terms, conditions, and

limitations that were applicable at the

time those approvals were granted.

(3) A CAH that was granted swing-bed

approval under paragraph (a)(2) of this

section may request that its application

to be a CAH and a swing-bed provider

be reevaluated under paragraph (a)(1) of

this section. If this request is approved,

the approval is effective not earlier than

October 1, 1997. As of the date of

approval, the CAH no longer has any

status under paragraph (a)(2) of this

section, and may not request

reinstatement under paragraph (a)(2) of

this section.

(4) Any bed of a unit of the facility

that is licensed as a distinct-part SNF at

the time the facility applies to the State

for designation as a CAH is not counted

under paragraph (a)(1) of this section.

(b) Payment. Payment for inpatient

CAH services to a CAH that has

qualified as a CAH under the provisions

in paragraph (a) of this section is made
Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations 46037

in accordance with § 413.70 of this

chapter. * * *

* * * * *

H. Part 489 is amended as set forth

below:

PART 489—PROVIDER AGREEMENTS

AND SUPPLIER APPROVAL

1. The authority citation for Part 489

continues to read as follows:

Authority: Secs. 1102, 1819, 1861,

1864(m), 1866, and 1871 of the Social

Security Act (42 U.S.C. 1302, 1395i–3, 1395x,

1395aa(m), 1395cc, and 1395hh).

§ 489.27 [Amended]

2. In § 489.27, the reference ‘‘section

1886(a)(1)(M) of the Act’’ is revised to

read ‘‘section 1866(a)(1)(M) of the Act’’.

§ 489.53 [Amended]

3. In § 489.53, paragraph (a)(14) is

removed.

Nomenclature Changes

1. In the following sections, ‘‘rural

primary care hospital (RPCH)’’ is

revised to read ‘‘critical access hospital

(CAH)’’:

§ 410.150(b)(12)

§ 440.170(g) heading

§ 498.2 definition of provider

2. In the following parts or sections,

‘‘rural primary care hospitals (RPCHs)’’

is revised to read ‘‘critical access

hospital (CAHs)’’:

§ 413.1(a)(2)(i)

§ 489.2(b)(7)

3. In the following sections or section

headings, ‘‘an RPCH’’ is revised to read

‘‘a CAH’’, wherever it appears:

§ 409.10(b)

§ 409.20(c)(3)

§ 409.27

§ 409.60(b)(1)(ii)

§ 409.61(b) paragraph heading

§ 409.82(a)(1)

§ 410.3(a)(1)

§ 410.10(c)

§ 410.38(b)

§ 410.60(b)

§ 411.15(m)(1)

§ 440.170 (g)(1) and (g)(2)

§ 485.601(b)

§ 485.604 introductory text

§ 489.20(d)

4. In the following sections, ‘‘RPCH’’

is revised to read ‘‘CAH’’ wherever it

appears:

§ 409.5 first sentence

§ 409.10(a) introductory text and (a)(3)

§ 409.11 (b)(1)(ii), (b)(1)(iii), (b)(3)

introductory text, and (b)(3)(ii)

§ 409.12 section heading, (a), and (b)

§ 409.13(a) introductory text, (a)(1),

(a)(2), (a)(3), and (b)

§ 409.14(a) introductory text, (a)(1),

(a)(2), (b) introductory text, (b)(1), and

(b)(2)

§ 409.15 introductory text

§ 409.16 introductory text, (a), (b), and

(c)

§ 409.20(a) introductory text

§ 409.30 introductory text,(a)(2), (b)(1),

(b)(2), and footnote 1

§ 409.31 (b)(2)(i) and (b)(2)(ii)

§ 409.60(a)

§ 409.61(a) paragraph heading, (a)(1)(i),

(a)(2), (a)(3), (b), and (c)

§ 409.64(a)(2)(ii)

§ 409.65 (a)(1), (a)(3), (a)(4), (d)(1),

(d)(2), (d)(3), (e)(1), (e)(2) introductory

text, (e)(2)(i), and (e)(2)(ii)

§ 409.66(b) and (c)(2)

§ 409.68 heading, (a) introductory text,

(a)(1), (a)(2), (a)(3), (a)(4), (b)(2), and

(c)

§ 409.80 (a)(1) and (a)(2)

§ 409.82(c)

§ 409.83(a)(1) and (c)(1)

§ 409.87(a)(3) and (b)(1)

§ 410.10(d)

§ 410.28 heading, (a) introductory text,

(a)(1), (a)(2), and (a)(4)

§ 410.32(b)(1)

§ 410.40(a) in the definitions of

‘‘Appropriate hospital’’, ‘‘Hospital

inpatient’’, ‘‘Locality’’, and ‘‘Outside

supplier’’, (b)(3) introductory text,

(b)(3)(i), (c)(1), (c)(2), (c)(3), (e)(1),

(e)(2), and (e)(3)

§ 410.60 (b) and (d)

§ 410.62 (b) and (c)

§ 410.150(b)(12)

§ 410.161(b)(2)

§ 413.114(b), definition of ‘‘Swing-bed

hospital’’

§ 424.15 (a) and (b)

§ 424.20 introductory text

§ 440.170 (g)(1) and (g)(2)

§ 485.602

§ 485.608 introductory text, (a), (c), and

(d)

§ 485.618 introductory text, (b)

introductory text, and (e)

§ 485.623(a), (b) introductory text, (c)

introductory text, (c)(4), and (d)(1),

(2), (3), and (4)

§ 485.627(a), (b) introductory text, (b)(1),

and (b)(2)

§ 485.631 (a)(1), (a)(3), (a)(4), (a)(5),

(b)(1)(i), (b)(1)(ii), (b)(1)(iii), (b)(2),

(c)(1) introductory text, (c)(1)(i),

(c)(2)(i), (c)(2)(ii), and (c)(3)

§ 485.635 (a)(1), (a)(2), (a)(3)(i),

(a)(3)(iii), (a)(3)(vii), (a)(4), (b)(1),

(b)(2) introductory text, (b)(3), (b)(4),

(c)(1) introductory text, (c)(1)(iii),

(c)(1)(iv), (c)(2), (c)(3), (c)(4)

introductory text, (c)(4)(i), (c)(4)(ii),

(d)(1), and (d)(2)

§ 485.638 (a)(1), (a)(4), (b)(1), and (b)(2)

§ 485.639 introductory text, (a)

introductory text, (b), and (c)

introductory text

§ 485.641(a)(1) introductory text,

(a)(1)(i), (a)(1)(iii), (b) introductory

text, (b)(3), (b)(4), (b)(5)(i), (b)(5)(ii),

and (b)(5)(iii)

§ 485.645(c) introductory text

§ 489.20(e)

5. In the following sections, ‘‘RPCHs’’

is revised to read ‘‘CAHs’’, wherever it

appears:

§ 485.601(a)

6. In the following parts or sections,

‘‘rural primary care hospital’’ is revised

to read ‘‘critical access hospital’’,

whenever it appears:

Part 409, subpart B heading

§ 409.1(c)

§ 414.60(b)

§ 488.1 in the definition of ‘‘Provider of

services’’

§ 488.10(d)

§ 488.18(d)

§ 489.24(b) in the definitions of

‘‘Hospital’’ and ‘‘Participating

hospital’’

§ 489.53(a)(10) and (b) introductory text

7. In the following sections, ‘‘rural

primary care hospitals’’ is revised to

read ‘‘critical access hospitals’’,

wherever it appears:

§ 413.124(a)

§ 413.130(j)(1)

§ 488.6(a)

§ 489.102(a)

(Catalog of Federal Domestic Assistance

Program No. 93.773, Medicare—Hospital

Insurance; and Program No. 93.774,

Medicare—Supplementary Medical

Insurance)

Dated: August 22, 1997.

Bruce C. Vladeck,

Administrator, Health Care Financing

Administration.

Dated: August 22, 1997.

Donna E. Shalala,

Secretary.

[Editorial Note: The following addendum

and appendixes will not appear in the Code

of Federal Regulations.]

Addendum—Schedule of Standardized

Amounts Effective With Discharges

Occurring On or After October 1, 1997

and Update Factors and Rate-ofIncrease Percentages Effective With

Cost Reporting Periods Beginning On or

After October 1, 1997

I. Summary and Background

In this addendum, we set forth the

amounts and factors for determining

prospective payment rates for Medicare

inpatient operating costs and Medicare

inpatient capital-related costs. We also

set forth rate-of-increase percentages for

updating the target amounts for

hospitals and hospital units excluded

from the prospective payment system.

For discharges occurring on or after

October 1, 1997, except for sole

community hospitals, Medicaredependent, small rural hospitals, and
46038 Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations

hospitals located in Puerto Rico, each

hospital’s payment per discharge under

the prospective payment system will be

based on 100 percent of the Federal

national rate.

Sole community hospitals are paid

based on whichever of the following

rates yield the greatest aggregate

payment: the Federal national rate, the

updated hospital-specific rate based on

FY 1982 cost per discharge, or the

updated hospital-specific rate based on

FY 1987 cost per discharge. Medicaredependent, small rural hospitals are

paid based on the Federal national rate

or, if higher, the Federal national rate

plus 50 percent of the difference

between the Federal national rate and

the updated hospital-specific rate based

on FY 1982 or FY 1987 cost per

discharge, whichever is higher. For

hospitals in Puerto Rico, the payment

per discharge is based on the sum of 50

percent of a Puerto Rico rate and 50

percent of a national rate (section 4406

of Pub. L. 105–33 amended section

1886(d)(9)(A) of the Act to change the

basis of the payment per discharge for

hospitals in Puerto Rico from 75 percent

of a Puerto Rico rate to 50 percent of a

Puerto Rico rate and from 25 percent of

a national rate to 50 percent of a

national rate).

As discussed below in section II, we

are making changes in the

determination of the prospective

payment rates for Medicare inpatient

operating costs. The changes, to be

applied prospectively, affect the

calculation of the Federal rates. In

section III, we discuss our changes for

determining the prospective payment

rates for Medicare inpatient capitalrelated costs. Section IV sets forth our

changes for determining the rate-ofincrease limits for hospitals excluded

from the prospective payment system.

The tables to which we refer in the

preamble to this final rule are presented

at the end of this addendum in section

V.

II. Changes to Prospective Payment

Rates for Inpatient Operating Costs for

FY 1998

The basic methodology for

determining prospective payment rates

for inpatient operating costs is set forth

at § 412.63 for hospitals located outside

of Puerto Rico. The basic methodology

for determining the prospective

payment rates for inpatient operating

costs for hospitals located in Puerto

Rico is set forth at §§ 412.210 and

412.212. (See section V.I of the

preamble for a discussion of the Puerto

Rico payment rate.) Below, we discuss

the manner in which we are changing

some of the factors used for determining

the prospective payment rates. The

Federal and Puerto Rico rate changes

will be effective with discharges

occurring on or after October 1, 1997. As

required by section 1886(d)(4)(C) of the

Act, we must also adjust the DRG

classifications and weighting factors for

discharges in FY 1998.

In summary, the standardized

amounts set forth in Tables 1A and 1C

of section V of this addendum reflect—

• Updates of 0 percent for all areas;

• An adjustment to ensure budget

neutrality as provided for in sections

1886 (d)(4)(C)(iii) and (d)(3)(E) of the

Act by applying new budget neutrality

adjustment factors to the large urban

and other standardized amounts;

• An adjustment to ensure budget

neutrality as provided for in section

1886(d)(8)(D) of the Act by removing the

FY 1997 budget neutrality factor and

applying a revised factor;

• An adjustment to apply the revised

outlier offset by removing the FY 1997

outlier offsets and applying a new offset;

and

• An adjustment in the Puerto Rico

standardized amounts to reflect the

application of a Puerto Rico-specific

wage index.

The standardized amounts set forth in

Tables 1E and 1F of section V of this

addendum, which apply to ‘‘temporary

relief’’ hospitals (see section V.D of the

preamble for a discussion of these

hospitals), reflect updates of 0.5 percent

for all areas but otherwise reflect the

same adjustments as the national

standardized amounts.

A. Calculation of Adjusted

Standardized Amounts

1. Standardization of Base-Year Costs or

Target Amounts

Section 1886(d)(2)(A) of the Act

required the establishment of base-year

cost data containing allowable operating

costs per discharge of inpatient hospital

services for each hospital. The preamble

to the September 1, 1983 interim final

rule (48 FR 39763) contains a detailed

explanation of how base-year cost data

were established in the initial

development of standardized amounts

for the prospective payment system and

how they are used in computing the

Federal rates.

Section 1886(d)(9)(B)(i) of the Act

required that Medicare target amounts

be determined for each hospital located

in Puerto Rico for its cost reporting

period beginning in FY 1987. The

September 1, 1987 final rule contains a

detailed explanation of how the target

amounts were determined and how they

are used in computing the Puerto Rico

rates (52 FR 33043, 33066).

The standardized amounts are based

on per discharge averages of adjusted

hospital costs from a base period or, for

Puerto Rico, adjusted target amounts

from a base period, updated and

otherwise adjusted in accordance with

the provisions of section 1886(d) of the

Act. Sections 1886(d)(2) (B) and (C) of

the Act required that the base-year per

discharge costs be updated for FY 1984

and then standardized in order to

remove from the cost data the effects of

certain sources of variation in cost

among hospitals. These include case

mix, differences in area wage levels,

cost of living adjustments for Alaska

and Hawaii, indirect medical education

costs, and payments to hospitals serving

a disproportionate share of low-income

patients.

Under sections 1886 (d)(2)(H) and

(d)(3)(E) of the Act, in making payments

under the prospective payment system,

the Secretary estimates from time to

time the proportion of costs that are

wages and wage-related costs. Since

October 1, 1996, when the market basket

was last revised and rebased, we have

considered 71.2 percent of costs to be

labor-related for purposes of the

prospective payment system. As

discussed in section IV of the preamble,

we are including data not available

when the market basket was last rebased

to adjust the market basket effective for

FY 1998. Based on the proposed revised

market basket, we are revising the labor

and nonlabor proportions of the

standardized amounts. Effective with

discharges occurring on or after October

1, 1997, we are establishing a laborrelated proportion of 71.1 percent and a

nonlabor-related proportion of 28.9

percent. (We are revising the Puerto

Rico standardized amounts by the

average labor share in Puerto Rico of

71.3 percent. We are revising the

discharged-weighted national

standardized amount to reflect the

proportion of discharges in large urban

and other areas from the FY 1996

MedPAR file.)

2. Computing Large Urban and Other

Area Averages

Sections 1886(d) (2)(D) and (3) of the

Act require the Secretary to compute

two average standardized amounts for

discharges occurring in a fiscal year: one

for hospitals located in large urban areas

and one for hospitals located in other

areas. In addition, under sections

1886(d)(9) (B)(iii) and (C)(i) of the Act,

the average standardized amount per

discharge must be determined for

hospitals located in urban and other

areas in Puerto Rico. Hospitals in Puerto

Rico are paid a blend of 50 percent of

the applicable Puerto Rico standardized
Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations 46039

amount and 50 percent of a national

standardized payment amount. (Section

4406 of Public Law 105–33 amended

section 1886(d)(9)(A) of the Act to

change the payment for hospitals in

Puerto Rico from 75 percent of the

applicable Puerto Rico standardized

payment amount and 25 percent of the

applicable national standardized

payment amount to 50 percent of the

applicable Puerto Rico standardized

payment amount and 50 percent of the

applicable national standardized

payment amount.)

Section 1886(d)(2)(D) of the Act

defines ‘‘urban area’’ as those areas

within a Metropolitan Statistical Area

(MSA). A ‘‘large urban area’’ is defined

as an urban area with a population of

more than 1,000,000. In addition,

section 4009(i) of Public Law 100–203

provides that a New England County

Metropolitan Area (NECMA) with a

population of more than 970,000 is

classified as a large urban area. As

required by section 1886(d)(2)(D) of the

Act, population size is determined by

the Secretary based on the latest

population data published by the

Bureau of the Census. Urban areas that

do not meet the definition of a ‘‘large

urban area’’ are referred to as ‘‘other

urban areas.’’ Areas that are not

included in MSAs are considered ‘‘rural

areas’’ under section 1886(d)(2)(D) of

the Act. Payment for discharges from

hospitals located in large urban areas

will be based on the large urban

standardized amount. Payment for

discharges from hospitals located in

other urban and rural areas will be

based on the other standardized

amount.

Based on 1996 population estimates

published by the Bureau of the Census,

60 areas meet the criteria to be defined

as large urban areas for FY 1998. These

areas are identified by a footnote in

Table 4A. We note that the Secretary has

chosen to exercise the authority granted

by section 4408 of Public Law 105–33

to include Stanly County, North

Carolina in the Charlotte-Gastonia-Rock

Hill, North Carolina-South Carolina

MSA for purposes of payment under the

prospective payment system.

3. Updating the Average Standardized

Amounts

Under section 1886(d)(3)(A) of the

Act, we update the area average

standardized amounts each year. In

accordance with section

1886(d)(3)(A)(iv) of the Act, we are

updating the large urban and the other

areas average standardized amounts for

FY 1998 using the applicable percentage

increases specified in section

1886(b)(3)(B)(i) of the Act. As amended

by section 4401 of Public Law 105–33,

Section 1886(b)(3)(B)(i)(XIII) of the Act

specifies that, for hospitals in all areas,

the update factor for the standardized

amounts for FY 1998 is equal to zero

percent. Section 4401 of Public Law

105–33 also provides for an update of

0.5 percent for hospitals that are not

Medicare-dependent small rural

hospitals, that receive no IME or DSH

payments, that are located in a State in

which aggregate Medicare operating

payments for such hospitals were less

than their aggregate allowable Medicare

operating costs for their cost reporting

periods beginning during FY 1995, and

whose Medicare operating payments are

less than their allowable Medicare

operating costs in FY 1998.

As in the past, we are adjusting the

FY 1997 standardized amounts to

remove the effects of the FY 1997

geographic reclassifications and outlier

payments before applying the FY 1998

updates. That is, we are increasing the

standardized amounts to restore the

reductions that were made for the

effects of geographic reclassification and

outliers in FY 1997. After including new

offsets to the standardized amounts for

outliers and geographic reclassification

for FY 1998, we estimate that there will

be an overall decrease of 5.6 percent to

the large urban and other area

standardized amounts.

Although the update factor for FY

1998 is set by law, we are required by

section 1886(e)(4)(A) of the Act to report

to Congress on our final

recommendation of update factors for

FY 1998 for both prospective payment

hospitals and hospitals excluded from

the prospective payment system. We

have included our final

recommendation in Appendix D to this

final rule.

4. Other Adjustments to the Average

Standardized Amounts

a. Recalibration of DRG Weights and

Updated Wage Index—Budget

Neutrality Adjustment. Section

1886(d)(4)(C)(iii) of the Act specifies

that beginning in FY 1991, the annual

DRG reclassification and recalibration of

the relative weights must be made in a

manner that ensures that aggregate

payments to hospitals are not affected.

As discussed in section II of the

preamble, we normalized the

recalibrated DRG weights by an

adjustment factor, so that the average

case weight after recalibration is equal

to the average case weight prior to

recalibration.

Section 1886(d)(3)(E) of the Act

specifies that the hospital wage index

must be updated on an annual basis

beginning October 1, 1993. This

provision also requires that any updates

or adjustments to the wage index must

be made in a manner that ensures that

aggregate payments to hospitals are not

affected by the change in the wage

index.

To comply with the requirement of

section 1886(d)(4)(C)(iii) of the Act that

DRG reclassification and recalibration of

the relative weights be budget neutral,

and the requirement in section

1886(d)(3)(E) of the Act that the updated

wage index be budget neutral, we used

historical discharge data to simulate

payments and compared aggregate

payments using the FY 1997 relative

weights and wage index to aggregate

payments using the FY 1998 relative

weights and wage index. The same

methodology was used for the FY 1997

budget neutrality adjustment. (See the

discussion in the September 1, 1992

final rule (57 FR 39832).) Based on this

comparison, we computed a budget

neutrality adjustment factor equal to

0.997731. We adjust the Puerto Ricospecific standardized amounts for the

effect of DRG reclassification and

recalibration. We computed a budget

neutrality adjustment factor for Puerto

Rico-specific standardized amounts

equal to 0.999117. These budget

neutrality adjustment factors are applied

to the standardized amounts without

removing the effects of the FY 1997

budget neutrality adjustments. We do

not remove the prior budget neutrality

adjustment because estimated aggregate

payments after the changes in the DRG

relative weights and wage index should

equal estimated aggregate payments

prior to the changes. If we removed the

prior year adjustment, we would not

satisfy this condition.

In addition, we will continue to apply

the same FY 1998 adjustment factor to

the hospital-specific rates that are

effective for cost reporting periods

beginning on or after October 1, 1997, in

order to ensure that we meet the

statutory requirement that aggregate

payments neither increase nor decrease

as a result of the implementation of the

FY 1998 DRG weights and updated

wage index. (See the discussion in the

September 4, 1990 final rule (55 FR

36073).)

b. Reclassified Hospitals—Budget

Neutrality Adjustment. Section

1886(d)(8)(B) of the Act provides that

certain rural hospitals are deemed urban

effective with discharges occurring on

or after October 1, 1988. In addition,

section 1886(d)(10) of the Act provides

for the reclassification of hospitals

based on determinations by the

Medicare Geographic Classification

Review Board (MGCRB). Under section

1886(d)(10) of the Act, a hospital may be
46040 Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations

reclassified for purposes of the

standardized amount or the wage index,

or both.

Under section 1886(d)(8)(D) of the

Act, the Secretary is required to adjust

the standardized amounts so as to

ensure that total aggregate payments

under the prospective payment system

after implementation of the provisions

of sections 1886(d)(8) (B) and (C) and

1886(d)(10) of the Act are equal to the

aggregate prospective payments that

would have been made absent these

provisions. To calculate this budget

neutrality factor, we used historical

discharge data to simulate payments,

and compared total prospective

payments (including IME and DSH

payments) prior to any reclassifications

to total prospective payments after

reclassifications. We are applying an

adjustment factor of 0.994720 to ensure

that the effects of reclassification are

budget neutral.

The adjustment factor is applied to

the standardized amounts after

removing the effects of the FY 1997

budget neutrality adjustment factor. We

note that the FY 1998 adjustment

reflects wage index and standardized

amount reclassifications approved by

the MGCRB or the Administrator as of

February 27, 1997. The effects of

additional reclassification changes

resulting from appeals and reviews of

the MGCRB decisions for FY 1998 or

from a hospital’s request for the

withdrawal of a reclassification request

are reflected in the final budget

neutrality adjustment required under

section 1886(d)(8)(D) of the Act and

published in the final rule for FY 1998.

c. Outliers. Section 1886(d)(5)(A) of

the Act provides for payments in

addition to the basic prospective

payments for ‘‘outlier’’ cases, cases

involving extraordinarily high costs

(cost outliers) or long lengths of stay

(day outliers). Section 1886(d)(3)(B) of

the Act requires the Secretary to adjust

both the large urban and other area

national standardized amounts by the

same factor to account for the estimated

proportion of total DRG payments made

to outlier cases. Similarly, section

1886(d)(9)(B)(iv) of the Act requires the

Secretary to adjust the large urban and

other standardized amounts applicable

to hospitals in Puerto Rico to account

for the estimated proportion of total

DRG payments made to outlier cases.

Furthermore, under section

1886(d)(5)(A)(iv) of the Act, outlier

payments for any year must be projected

to be not less than 5 percent nor more

than 6 percent of total payments based

on DRG prospective payment rates.

Beginning with FY 1995, section

1886(d)(5)(A) of the Act requires the

Secretary to phase out payments for day

outliers (correspondingly, payments for

cost outliers would increase). Under the

requirements of section

1886(d)(5)(A)(v), the proportion of day

outlier payments to total outlier

payments is reduced from FY 1994

levels as follows: 75 percent of FY 1994

levels in FY 1995, 50 percent of FY 1994

levels in FY 1996, and 25 percent of FY

1994 levels in FY 1997. For discharges

occurring after September 30, 1997, the

Secretary will no longer pay for day

outliers under the provisions of section

1886(d)(5)(A)(i) of the Act.

i. FY 1998 Outlier Payment

Thresholds. For FY 1997, the day outlier

threshold is the geometric mean length

of stay for each DRG plus the lesser of

24 days or 3.0 standard deviations. The

marginal cost factor for day outliers (the

percent of Medicare’s average per diem

payment paid for each outlier day) is 33

percent for FY 1997. The fixed loss cost

outlier threshold is equal to the

prospective payment for the DRG plus

$9,700 ($8,850 for hospitals that have

not yet entered the prospective payment

system for capital-related costs). The

marginal cost factor for cost outliers (the

percent of costs paid after costs for the

case exceed the threshold) is 80 percent.

We applied an outlier adjustment to the

FY 1997 standardized amounts of

0.948766 for the large urban and other

areas rates and 0.9481 for the capital

Federal rate.

As noted above, section

1886(d)(5)(A)(v) of the Act provides that

payment will not be made for day

outliers beginning with discharges

occurring in FY 1998.

In the proposed rule, we proposed to

establish a fixed loss cost outlier

threshold in FY 1998 equal to the

prospective payment rate for the DRG

plus $7,600 ($6,950 for hospitals that

have not yet entered the prospective

payment system for capital-related

costs). In addition, we proposed to

maintain the marginal cost factor for

cost outliers at 80 percent. Section 4405

of Public Law 105–33 amended section

1886(d)(5)(A)(ii) of the Act to revise the

definition of the cost outlier threshold.

For FY 1997, the statute required the

fixed loss cost outlier threshold to be

based on ‘‘the applicable DRG

prospective payment rate plus a fixed

dollar amount determined by the

Secretary’’. Public Law 105–33 provides

that, beginning in FY 1998, the fixed

loss cost outlier threshold is based on

‘‘the sum of the applicable DRG

prospective payment rate plus any

amounts payable under subparagraphs

(B) [IME payments] and (F) [DSH

payments] plus a fixed dollar amount

determined by the Secretary’’.

Consistent with this statutory change,

the methodology for setting the final FY

1998 cost outlier threshold differs from

the methodology used for the proposed

rule because we no longer adjust

hospital costs to exclude IME and DSH

payments (see section V.A. of the

preamble). In addition, in setting the

final FY 1998 outlier thresholds, we

used updated data and revised cost

inflation factor (discussed below). Thus,

for FY 1998, in order for a case to

qualify for cost outlier payments, the

costs must exceed the prospective

payment rate for the DRG plus the IME

and DSH payments plus $11,050

($10,080 for hospitals that have not yet

entered the prospective payment system

for capital-related costs). We are also

establishing a marginal cost factor for

cost outliers of 80 percent, as proposed.

In accordance with section

1886(d)(5)(A)(iv) of the Act, we

calculated outlier thresholds so that

outlier payments are projected to equal

5.1 percent of total payments based on

DRG prospective payment rates. In

accordance with section 1886(d)(3)(E),

we reduced the FY 1998 standardized

amounts by the same percentage to

account for the projected proportion of

payments paid to outliers.

As stated in the September 1, 1993

final rule (58 FR 46348), we establish

outlier thresholds that are applicable to

both inpatient operating costs and

inpatient capital-related costs. When we

modeled the combined operating and

capital outlier payments, we found that

using a common set of thresholds

resulted in a higher percentage of outlier

payments for capital-related costs than

for operating costs. We project that the

proposed thresholds for FY 1998 will

result in outlier payments equal to 5.1

percent of operating DRG payments and

6.2 percent of capital payments based

on the Federal rate.

The proposed outlier adjustment

factors applied to the standardized

amounts for FY 1998 were as follows:

Operating

standardized

amounts

Capital

federal

rate

National ..................... 0.949117 0.9449

Puerto Rico ............... 0.961448 0.9449

The final outlier adjustment factors

applied to the standardized amounts for

FY 1998 are as follows:

Operating

standardized

amounts

Capital

federal

rate

National ..................... 0.948840 0.9382
Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations 46041

Operating

standardized

amounts

Capital

federal

rate

Puerto Rico ............... 0.971967 0.9598

As in the proposed rule, we apply the

outlier adjustment factors after

removing the effects of the FY 1997

outlier adjustment factors on the

standardized amounts.

ii. Other Changes Concerning

Outliers. Table 8A in section V of this

addendum contains the updated

Statewide average operating cost-tocharge ratios for urban hospitals and for

rural hospitals to be used in calculating

cost outlier payments for those hospitals

for which the intermediary is unable to

compute a reasonable hospital-specific

cost-to-charge ratio. These Statewide

average ratios would replace the ratios

published in the August 30, 1996 final

rule (61 FR 46302), effective October 1,

1997. Table 8B contains comparable

Statewide average capital cost-to-charge

ratios. These average ratios would be

used to calculate cost outlier payments

for those hospitals for which the

intermediary computes operating costto-charge ratios lower than 0.227808 or

greater than 1.29731 and capital cost-tocharge ratios lower than 0.01270 or

greater than 0.18955. This range

represents 3.0 standard deviations (plus

or minus) from the mean of the log

distribution of cost-to-charge ratios for

all hospitals. We note that the cost-tocharge ratios in Tables 8A and 8B will

be used for all cost reports settled

during FY 1998 (regardless of the actual

cost reporting period) when hospitalspecific cost-to-charge ratios are either

not available or outside the three

standard deviations range.

iii. FY 1996 and FY 1997 Outlier

Payments. In the August 30, 1996 final

rule (61 FR 46229), we stated that, based

on available data, we estimated that

actual FY 1996 outlier payments would

be approximately 4.0 percent of actual

total DRG payments. This was

computed by simulating payments using

actual FY 1995 bill data available at the

time. That is, the estimate of actual FY

1996 outlier payments did not reflect

actual FY 1996 bills but instead

reflected the application of FY 1996

rates and policies to available FY 1995

bills. Our current estimate, using

available FY 1996 bills, is that actual

outlier payments for FY 1996 were

approximately 4.2 percent of actual total

DRG payments. We note that the

MedPAR file for FY 1996 discharges

continues to be updated.

We currently estimate that actual

outlier payments for FY 1997 will be

approximately 4.8 percent of actual total

DRG payments (slightly lower than the

5.1 percent we projected in setting

outlier policies for FY 1997). This

estimate is based on simulations using

the June 1997 update of the providerspecific file and the June 1997 update of

the FY 1996 MedPAR file (discharge

data for FY 1996 bills). We used these

data to calculate an estimate of the

actual outlier percentage for FY 1997 by

applying FY 1997 rates and policies to

available FY 1996 bills.

In FY 1994, we began using a cost

inflation factor rather than a charge

inflation factor to update billed charges

for purposes of estimating outlier

payments. This refinement was made to

improve our estimation methodology.

We believe that actual FY 1996 and FY

1997 outlier payments as a percentage of

total DRG payments may be lower than

expected in part because actual hospital

costs may be lower than reflected in the

methodology used to set outlier

thresholds for those years. Our most

recent data on hospital costs show that

rates of increase are continuing to

decline. Thus, the cost inflation factor of

0.871 percent used to set FY 1996

outlier policy (based on the best data

then available) appears to have been

overstated. For FY 1997, we used a cost

inflation factor of minus 1.906 percent

(a cost per case decrease of 1.906

percent). In the proposed rule, based on

data then available, we used a cost

inflation factor of minus 1.969 percent

to set outlier thresholds for FY 1998.

Based on the most recent data available,

we are using a cost inflation factor of

minus 2.005 percent for purposes of

setting the final 1998 outlier thresholds.

Although we estimate that FY 1996

outlier payments will approximate 4.2

percent of total DRG payments, we note

that the estimate of the market basket

rate of increase used to set the FY 1996

rates was 3.5 percentage points, while

the latest FY 1996 market basket rate of

increase forecast is 2.7 percent. Thus,

the net effect is that hospitals received

higher FY 1996 payments than would

have been established based on a more

recent forecast of the market basket rate

of increase.

Comment: One commenter modeled

the outlier payments and was able to

replicate HCFA’s result of 5.1 percent

for operating outlier payments, but the

commenter’s analysis yielded only 5.3

percent for capital outlier payments as

compared with HCFA’s result of 5.5

percent.

Response: Although we are unable to

analyze the commenter’s modeling

methodology before publication of this

document, we will attempt to ascertain

the source of the discrepancy between

the commenter’s outlier model and

HCFA’s outlier model before next year’s

proposed rule.

5. FY 1998 Standardized Amounts

The adjusted standardized amounts

are divided into labor and nonlabor

portions. Table 1A (and Table 1E for

‘‘temporary relief’’ hospitals) contain

the standardized amounts that are

applicable to all hospitals, except for

hospitals in Puerto Rico. Under section

1886(d)(9)(A)(ii) of the Act, the Federal

portion of the Puerto Rico payment rate

is based on the discharge-weighted

average of the national large urban

standardized amount and the national

other standardized amount (as set forth

in Tables 1A and 1E). The labor and

nonlabor portions of the national

average standardized amounts for

Puerto Rico hospitals are set forth in

Table 1C (and Table 1F for ‘‘temporary

relief’’ hospitals). These tables also

include the Puerto Rico standardized

amounts.

The Puerto Rico standardized

amounts reflect application of a Puerto

Rico-specific wage index for FY 1998.

Thus, before application of the wage

index, the FY 1998 Puerto Rico

standardized amounts are lower than

the FY 1997 standardized amounts.

However, after application of the wage

index, the FY 1998 Puerto Rico rate is

higher than the rate for FY 1997. This

is due to the higher Puerto Rico wage

index values that will be applied to

these standardized amounts in

calculating the FY 1998 Puerto Rico

rate. Below, we use two wage areas to

illustrate that the FY 1998 Puerto Rico

wage-adjusted standardized amounts are

higher than the FY 1997 Puerto Rico

wage-adjusted standardized amounts.

Puerto Rico Standardized Amounts

Area

FY 1997 FY 1998

Labor Nonlabor Labor Nonlabor

Large Urban ...................................................................................................... $2,488.70 $518.65 $1,323.01 $532.55

Other Areas ...................................................................................................... $2,449.31 $510.45 $1,302.07 $524.11
46042 Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations

Puerto Rico Wage-Adjusted

Standardized Amount for the San Juan

MSA and Rural Puerto Rico

FY 1997 FY 1998

San Juan Wage

Index .................... 0.4506 1.0156

Wage-Adjusted

Standardized

Amount ................. $1,640.06 $1,877.44

Rural Wage Index .... 0.4026 0.9291

Wage-Adjusted

Standardized

Amount ................. $1,496.54 $1,735.01

Table 1E contains the two national

standardized amounts that are

applicable to the ‘‘temporary relief’’

hospitals discussed in section V.D of the

preamble to this rule, except those

located in Puerto Rico. The labor and

nonlabor portions of the national

average standardized amounts for

hospitals in that group that are located

in Puerto Rico are set forth in Table 1F.

This table also includes the Puerto Rico

standardized amounts for hospitals in

that group.

B. Adjustments for Area Wage Levels

and Cost-of-Living

Tables 1A, 1C, 1E and 1F, as set forth

in this addendum, contain the laborrelated and nonlabor-related shares used

to calculate the prospective payment

rates for hospitals located in the 50

States, the District of Columbia, and

Puerto Rico. This section addresses two

types of adjustments to the standardized

amounts that are made in determining

the prospective payment rates as

described in this addendum.

1. Adjustment for Area Wage Levels

Sections 1886(d)(3)(E) and

1886(d)(9)(C)(iv) of the Act require that

an adjustment be made to the laborrelated portion of the prospective

payment rates to account for area

differences in hospital wage levels. This

adjustment is made by multiplying the

labor-related portion of the adjusted

standardized amounts by the

appropriate wage index for the area in

which the hospital is located. In section

III of the preamble, we discuss certain

revisions we are making to the wage

index. These changes include the

calculation of a Puerto Rico-specific

wage index that are being applied to the

Puerto Rico standardized amounts. The

wage index is set forth in Tables 4A

through 4F of this addendum.

2. Adjustment for Cost-of-Living in

Alaska and Hawaii

Section 1886(d)(5)(H) of the Act

authorizes an adjustment to take into

account the unique circumstances of

hospitals in Alaska and Hawaii. Higher

labor-related costs for these two States

are taken into account in the adjustment

for area wages described above. For FY

1998, we adjusted the payments for

hospitals in Alaska and Hawaii by

multiplying the nonlabor portion of the

standardized amounts by the

appropriate adjustment factor contained

in the table below.

Table of Cost-of-Living Adjustment

Factors, Alaska and Hawaii Hospitals

Alaska—All areas ............................ 1.25

Hawaii:

County of Honolulu ................. 1.225

County of Hawaii ..................... 1.225

County of Kauai ........................ 1.225

County of Maui ......................... 1.225

County of Kalawao ................... 1.225

(The above factors are based on data obtained from the U.S. Office of Personnel

Management.)

C. DRG Relative Weights

As discussed in section II of the

preamble, we have developed a

classification system for all hospital

discharges, assigning them into DRGs,

and have developed relative weights for

each DRG that reflect the resource

utilization of cases in each DRG relative

to Medicare cases in other DRGs. Table

5 of section V of this addendum

contains the relative weights that we

will use for discharges occurring in FY

1998. These factors have been

recalibrated as explained in section II of

the preamble.

One commenter noted that there was

a typographical error in the proposed

Table 5. The proposed relative weight

for DRG 92 was incorrectly printed as

.1929 rather than 1.1929. The final

weight is 1.1947.

D. Calculation of Prospective Payment

Rates for FY 1998

General Formula for Calculation of

Prospective Payment Rates for FY 1998

Prospective payment rate for all

hospitals located outside Puerto Rico

except sole community hospitals and

Medicare-dependent, small rural

hospitals = Federal rate.

Prospective payment rate for sole

community hospitals = Whichever of

the following rates yields the greatest

aggregate payment: 100 percent of the

Federal rate, 100 percent of the updated

FY 1982 hospital-specific rate, or 100

percent of the updated FY 1987

hospital-specific rate.

Prospective payment rate for

Medicare-dependent, small rural

hospitals = 100 percent of the Federal

rate plus, if the greater of the updated

FY 1982 hospital-specific rate or the

updated FY 1987 hospital-specific rate

is higher than the Federal rate, 50

percent of the difference between the

applicable hospital-specific rate and the

Federal rate.

Prospective payment rate for Puerto

Rico = 50 percent of the Puerto Rico rate

+ 50 percent of a discharge-weighted

average of the national large urban

standardized amount and the national

other standardized amount.

1. Federal Rate

For discharges occurring on or after

October 1, 1997 and before October 1,

1998, except for sole community

hospitals, Medicare-dependent small

rural hospitals, and hospitals in Puerto

Rico, the hospital’s payment is based

exclusively on the Federal national rate.

Section 1866(d)(1)(A)(iii) of the Act

provides that the Federal rate is

comprised of 100 percent of the Federal

national rate.

The payment amount is determined as

follows:

Step 1—Select the appropriate

national standardized amount

considering the type of hospital and

designation of the hospital as large

urban or other (see Tables 1A or 1E,

section V of this addendum).

Step 2—Multiply the labor-related

portion of the standardized amount by

the applicable wage index for the

geographic area in which the hospital is

located (see Tables 4A, 4B, and 4C of

section V of this addendum).

Step 3—For hospitals in Alaska and

Hawaii, multiply the nonlabor-related

portion of the standardized amount by

the appropriate cost-of-living

adjustment factor.

Step 4—Add the amount from Step 2

and the nonlabor-related portion of the

standardized amount (adjusted if

appropriate under Step 3).

Step 5—Multiply the final amount

from Step 4 by the relative weight

corresponding to the appropriate DRG

(see Table 5 of section V of this

addendum).

2. Hospital-Specific Rate (Applicable

Only to Sole Community Hospitals and

Medicare-Dependent, Small Rural

Hospitals)

Sections 1886(d)(5)(D)(i) and (b)(3)(C)

of the Act provide that sole community

hospitals are paid based on whichever

of the following rates yields the greatest

aggregate payment: The Federal rate, the

updated hospital-specific rate based on

FY 1982 cost per discharge, or the

updated hospital-specific rate based on

FY 1987 cost per discharge.

Sections 1886(d)(5)(G) and (b)(3)(D) of

the Act (as amended by section 4204 of

Publ. L. 105–33) provide that Medicaredependent, small rural hospitals are
Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations 46043

paid based on whichever of the

following rates yields the greatest

aggregate payment: The Federal rate or

the Federal rate plus 50 percent of the

difference between the Federal rate and

the greater of the updated hospitalspecific rate based on FY 1982 and FY

1987 cost per discharge.

Hospital-specific rates have been

determined for each of these hospitals

based on both the FY 1982 cost per

discharge and the FY 1987 cost per

discharge. For a more detailed

discussion of the calculation of the FY

1982 hospital-specific rate and the FY

1987 hospital-specific rate, we refer the

reader to the September 1, 1983 interim

final rule (48 FR 39772); the April 20,

1990 final rule with comment period (55

FR 15150); and the September 4, 1990

final rule (55 FR 35994).

a. Updating the FY 1982 and FY 1987

Hospital-Specific Rates for FY 1998. We

are increasing the hospital-specific rates

by 0 percent for sole community

hospitals and Medicare-dependent,

small rural hospitals located in all areas

for FY 1998. Section 1886(b)(3)(C)(iv) of

the Act provides that the update factor

applicable to the hospital-specific rates

for sole community hospitals equals the

update factor provided under section

1886(b)(3)(B)(iv) of the Act, which, as

amended by section 4401 of Pub. L.

105–33, is 0 percent for FY 1998.

Section 1886(b)(3)(D) of the Act (as

amended by section 4204 of Publ. L.

105–33) provides that the update factor

applicable to the hospital-specific rates

for Medicare-dependent, small rural

hospitals equals the update factor

provided under section 1886(b)(3)(B)(iv)

of the Act, which, as amended by

section 4401 of Pub. L. 105–33, is 0

percent for FY 1998.

b. Calculation of Hospital-Specific

Rate. For sole community hospitals and

Medicare-dependent, small rural

hospitals, the applicable FY 1998

hospital-specific rate would be

calculated by increasing the hospital’s

hospital-specific rate for the preceding

fiscal year by the applicable update

factor (0 percent), which is the same as

the update for all prospective payment

hospitals except temporary relief

hospitals. In addition, the hospitalspecific rate would be adjusted by the

budget neutrality adjustment factor (that

is, 0.997731) as discussed in section

II.A.4.a of this Addendum. This

resulting rate would be used in

determining under which rate a sole

community hospital or Medicaredependent, small rural hospital is paid

for its discharges beginning on or after

October 1, 1997, based on the formulas

set forth above.

3. General Formula for Calculation of

Prospective Payment Rates for Hospitals

Located in Puerto Rico Beginning On or

After October 1, 1997 and Before

October 1, 1998

a. Puerto Rico Rate. The Puerto Rico

prospective payment rate is determined

as follows:

Step 1—Select the appropriate

adjusted average standardized amount

considering the large urban or other

designation of the hospital (see Table 1C

or 1F of section V of the addendum).

Step 2—Multiply the labor-related

portion of the standardized amount by

the appropriate Puerto Rico-specific

wage index (see Table 4F of section V

of the addendum).

Step 3—Add the amount from Step 2

and the nonlabor-related portion of the

standardized amount.

Step 4—Multiply the result in Step 3

by 50 percent.

Step 5—Multiply the amount from

Step 4 by the appropriate DRG relative

weight (see Table 5 of section V of the

addendum).

b. National Rate. The national

prospective payment rate is determined

as follows:

Step 1—Multiply the labor-related

portion of the national average

standardized amount (see Table 1C or

1F of section V of the addendum) by the

appropriate national wage index (see

Tables 4A and 4B of section V of the

addendum).

Step 2—Add the amount from Step 1

and the nonlabor-related portion of the

national average standardized amount.

Step 3—Multiply the result in Step 2

by 50 percent.

Step 4—Multiply the amount from

Step 3 by the appropriate DRG relative

weight (see Table 5 of section V of the

addendum).

The sum of the Puerto Rico rate and

the national rate computed above equals

the prospective payment for a given

discharge for a hospital located in

Puerto Rico.

III. Changes to Payment Rates for

Inpatient Capital-Related Costs for FY

1998

The prospective payment system for

hospital inpatient capital-related costs

was implemented for cost reporting

periods beginning on or after October 1,

1991. Effective with that cost reporting

period and during a 10-year transition

period extending through FY 2001,

hospital inpatient capital-related costs

are paid on the basis of an increasing

proportion of the capital prospective

payment system Federal rate and a

decreasing proportion of a hospital’s

historical costs for capital.

The basic methodology for

determining Federal capital prospective

rates is set forth at §§ 412.308 through

412.352. Below we discuss the factors

that we used to determine the Federal

rate and the hospital-specific rates for

FY 1998. The rates are effective for

discharges occurring on or after October

1, 1997.

For FY 1992, we computed the

standard Federal payment rate for

capital-related costs under the

prospective payment system by

updating the FY 1989 Medicare

inpatient capital cost per case by an

actuarial estimate of the increase in

Medicare inpatient capital costs per

case. Each year after FY 1992 we update

the standard Federal rate, as provided in

§ 412.308(c)(1), to account for capital

input price increases and other factors.

Also, § 412.308(c)(2) provides that the

Federal rate is adjusted annually by a

factor equal to the estimated proportion

of outlier payments under the Federal

rate to total capital payments under the

Federal rate. In addition, § 412.308(c)(3)

requires that the Federal rate be reduced

by an adjustment factor equal to the

estimated proportion of payments for

exceptions under § 412.348.

Furthermore, § 412.308(c)(4)(ii) requires

that the Federal rate be adjusted so that

the annual DRG reclassification and the

recalibration of DRG weights and

changes in the geographic adjustment

factor are budget neutral. For FYs 1992

through 1995, § 412.352 required that

the Federal rate also be adjusted by a

budget neutrality factor so that aggregate

payments for inpatient hospital capital

costs were projected to equal 90 percent

of the payments that would have been

made for capital-related costs on a

reasonable cost basis during the fiscal

year. That provision expired in FY 1996.

Finally, § 412.308(b)(2) describes the 7.4

percent reduction to the rate which was

made in FY 1994, and § 412.308(b)(3)

describes the 0.28 percent reduction to

the rate made in FY 1996 as a result of

the revised policy of paying for

transfers.

In this final rule with comment period

we are implementing section 4402 of

Public Law 105–33, which requires that,

effective for discharges occurring on or

after October 1, 1997, and before

October 1, 2002, the unadjusted

standard Federal rate shall be reduced

by 17.78 percent. Part of that reduction

will be restored effective October 1,

2002.

For each hospital, the hospitalspecific rate was calculated by dividing

the hospital’s Medicare inpatient

capital-related costs for a specified base

year by its Medicare discharges

(adjusted for transfers), and dividing the
46044 Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations

result by the hospital’s case mix index

(also adjusted for transfers). The

resulting case-mix adjusted average cost

per discharge was then updated to FY

1992 based on the national average

increase in Medicare’s inpatient capital

cost per discharge and adjusted by the

exceptions payment adjustment factor

and the budget neutrality adjustment

factor to yield the FY 1992 hospitalspecific rate. Since FY 1992, the

hospital-specific rate has been updated

annually for inflation and for changes in

the exceptions payment adjustment

factor. For FYs 1992 through 1995, the

hospital-specific rate was also adjusted

by a budget neutrality adjustment factor.

In this final rule with comment period

we are implementing section 4402 of

Public Law 105–33, which requires that,

effective for discharges occurring on or

after October 1, 1997, and before

October 1, 2002, the unadjusted hospital

specific rate shall be reduced by 17.78

percent. Part of that reduction will be

restored effective October 1, 2002.

To determine the appropriate budget

neutrality adjustment factor and the

exceptions payment adjustment factor,

we developed a dynamic model of

Medicare inpatient capital-related costs,

that is, a model that projects changes in

Medicare inpatient capital-related costs

over time. With the expiration of the

budget neutrality provision, the model

is still used to estimate the exceptions

payment adjustment and other factors.

The model and its application are

described in greater detail in Appendix

B.

In accordance with section

1886(d)(9)(A) of the Act, under the

prospective payment system for

inpatient operating costs, hospitals

located in Puerto Rico are paid for

operating costs under a special payment

formula. These hospitals are paid a

blended rate that comprises 75 percent

of the applicable standardized amount

specific to Puerto Rico hospitals and 25

percent of the applicable national

average standardized amount. Under

§ 412.374, the methodology for

payments to Puerto Rico hospitals under

the prospective payment system for

inpatient capital-related costs parallels

the blended payment methodology for

operating payments to Puerto Rico

hospitals. Effective October 1, 1997, as

a result of section 4406 of Public Law

105–33, operating payments to hospitals

in Puerto Rico shall be based on a blend

of 50 percent of the applicable

standardized amount specific to Puerto

Rico hospitals and 50 percent of the

applicable national average

standardized amount. However, in

conjunction with this change to the

operating blend percentage, effective

with discharges on or after October 1,

1997, we are computing capital

payments to hospitals in Puerto Rico

based on a blend of 50 percent of the

Puerto Rico rate and 50 percent of the

Federal rate.

A. Determination of Federal Inpatient

Capital-Related Prospective Payment

Rate Update

For FY 1997, the Federal rate was

$438.92. In the proposed rule, we stated

that the proposed FY 1998 Federal rate

was $438.43. In this final rule with

comment period, we are establishing a

FY 1998 Federal rate of $371.51.

In the discussion that follows, we

explain the factors that were used to

determine the FY 1998 Federal rate. In

particular, we explain why the FY 1998

Federal rate has decreased 15.36 percent

compared to the FY 1997 Federal rate.

The major factor contributing to the

decrease in the FY 1998 rate in

comparison to the FY 1997 rate is the

17.78 percent reduction to the Federal

rate required by Public Law 105–33.

Also, capital payments per case are

estimated to decrease 8.92 percent.

Taking into account the effects of

increases in projected discharges, we

estimate that aggregate capital payments

will decrease 6.74 percent.

Total payments to hospitals under the

prospective payment system are

relatively unaffected by changes in the

capital prospective payments. Since

capital payments constitute about 10

percent of hospital payments, a 1

percent change in the capital Federal

rate yields only about 0.1 percent

change in actual payments to hospitals.

1. Reduction to the Standard Federal

Rate

Section 4402 of Pub. L. 105–33

requires that for discharges occurring

after October 1, 1997 the unadjusted

standard Federal rate be reduced by

15.68 percent, and by an additional 2.1

percent from October 1, 1997 through

September 30, 2002. Thus, the

unadjusted standard Federal rate used

to set the Federal rate each year is

reduced a total of 17.78 percent from

October 1, 1997 through September 30,

2002. After that date the 2.1 percent

reduction to the rate will be restored.

The regulation changes we are making

to implement this statutory requirement

are discussed in section VI.C of the

preamble. Here we discuss the effects of

the required reduction in computing the

FY 1998 Federal capital rate.

Under § 412.308(b), HCFA determines

the standard Federal rate by adjusting

the FY 1992 updated national average

cost per discharge by a factor so that

estimated payments based on the

standard Federal rate, adjusted by the

payment adjustments described in

§ 412.312(b), equal estimated aggregate

payments based solely on the national

average cost per discharge. Section

412.308(c) provides further that the

standard Federal rate is updated for

inflation each Federal fiscal year and

adjusted each year by an outlier

payment adjustment factor, and an

exceptions payment adjustment factor,

to determine the Federal capital

payment rate for that year. The standard

Federal rate is to be distinguished from

the annual Federal rate actually used in

making payment under the capital

prospective payment system. The

standard Federal rate is, in effect, the

underlying or base rate used to

determine the annual Federal rate by

means of the formula in § 412.308(c).

Because the 17.78 percent reduction

applies to the standard Federal rate

before the application of the adjustment

factors for outliers, exceptions, and

budget neutrality, the reduction to the

standard Federal rate does not have the

effect of simply lowering the FY 1998

Federal rate by 17.78 percent compared

to FY 1997. Rather, the 17.78 percent

reduction is one factor contributing to

the overall 15.36 percent reduction in

the FY 1998 Federal rate compared to

FY 1997. The FY 1998 exceptions

reduction factor increases the rate by

3.22 percent relative to the FY 1997

exceptions reduction factor. For a more

complete description of changes to the

Federal rate, see the table that compares

the FY 1997 rate with the FY 1998 rate

later in this addendum.

As discussed in the proposed rule,

ProPAC recommended that the rate be

adjusted to a more appropriate level

(Recommendation 3). They indicated

that the FY 1997 rate was 15 to 17

percent too high and attributed this to

the overstatement of the 1992 base

payment rates and the method used to

update the rates prior to implementation

of the update framework. ProPAC

outlined several possible approaches we

could use for adjusting the rate by

regulation. In our response, we agreed

with ProPAC that the capital rates were

too high and noted that the President’s

FY 1998 budget included a provision to

reduce the base Federal and hospitalspecific rates by approximately the

magnitude suggested by ProPAC. We

restated our belief that it was most

appropriate to make such adjustments to

the capital rates in the context of a

comprehensive package of Medicare

program changes. We therefore did not

propose to implement a revision to the

base capital rates by regulation for FY

1998.
Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations 46045

Comment: ProPAC noted that both

HCFA and ProPAC had recommended

that the base capital rate should be cut.

They also noted that a proposal to cut

the rate was included in the President’s

budget under consideration by the

Congress. However, ProPAC expressed

its belief that absent action by the

Congress to cut the capital rate, the

Secretary should cut the rate using her

regulatory authority.

Response: After ProPAC commented,

the Congress passed Public Law 105–33

and the President signed it into law in

early August. As anticipated, the

legislation included a reduction to the

unadjusted standard Federal rate and

the unadjusted hospital specific rate

along with several other changes to the

Medicare program. As discussed

previously, we are implementing the

reduction to the rate as part of this final

rule with comment period.

Comment: One State hospital

association expressed its opposition to a

reduction in capital payments. The

association stated that reducing capital

payments to hospitals would likely

increase borrowing costs by making

hospitals less attractive to investors, and

inhibit hospital’s abilities to modernize

their physical plants. The commenter

was especially concerned about the

impact of a rate cut on low volume rural

hospitals.

Response: As we noted in our

response to ProPAC’s previous

comment, we did not propose to cut the

capital rate by regulation in the

proposed rule. We stated our belief that

the capital rate should be addressed by

the Congress in conjunction with other

changes to the Medicare program. The

Congress included a 17.78 percent

reduction to the capital rate and the

hospital specific rate in Public Law

105–33, which we are implementing in

this final rule with comment period. We

have stated on several occasions that

due to a variety of factors capital

payments to hospitals are over-stated

and should be reduced. Based on data

we updated for this final rule with

comment period, we estimate that for

FY 1997 Medicare capital payments to

hospitals exceeded Medicare capital

costs by 8.7 percent. Many small rural

hospitals are also low cost hospitals that

have benefitted from the introduction of

a capital prospective payment system.

Many of these hospitals are paid on the

full prospective payment methodology

and capital payments are based on an

increasing percentage of the Federal rate

during the transition to fully

prospective capital payment system,

where the Federal rate is higher than the

hospital specific rate. However, because

capital payments are determined on a

per discharge basis, hospitals with few

discharges will necessarily receive

payments that are consistent with the

number of Medicare patients they serve.

We note however, that sole community

hospitals benefit from a higher

minimum payment threshold for

purposes of capital exceptions

payments. Further, together with this

capital rate reduction provision,

Congress has made other changes that

affect small rural hospitals. For

example, as of October 1, 1997, the

Medicare-dependent hospital provisions

are reinstated and the Critical Access

Hospital Program is established

nationwide.

2. Standard Federal Rate Update

a. Description of the Update

Framework. Section 412.308(c)(1)

provides that the standard Federal rate

is updated on the basis of an analytical

framework that takes into account

changes in a capital input price index

and other factors. The update

framework consists of a capital input

price index (CIPI) and several policy

adjustment factors. Specifically, we

have adjusted the projected CIPI rate of

increase as appropriate each year for

case-mix index related changes, for

intensity, and for errors in previous CIPI

forecasts. The proposed rule reflected an

update factor of 1.1 percent, based on

data available at that time. The final

update factor for FY 1998 under that

framework is 0.9 percent. This update

factor is based on a projected 1.1

percent increase in the CIPI, and on

policy adjustment factors of ¥0.2. We

explain the basis for the FY 1998 CIPI

projection in section D of this

addendum. Here we describe the policy

adjustments that have been applied.

The case-mix index is the measure of

the average DRG weight for cases paid

under the prospective payment system.

Because the DRG weight determines the

prospective payment for each case, any

percentage increase in the case-mix

index corresponds to an equal

percentage increase in hospital

payments.

The case-mix index can change for

any of several reasons:

• The average resource use of

Medicare patients changes (‘‘real’’ casemix change);

• Changes in hospital coding of

patient records result in higher weight

DRG assignments (‘‘coding effects’’); and

• The annual DRG reclassification

and recalibration changes may not be

budget neutral (‘‘reclassification

effect’’).

We define real case-mix change as

actual changes in the mix (and resource

requirements) of Medicare patients as

opposed to changes in coding behavior

that result in assignment of cases to

higher-weighted DRGs, but do not

reflect higher resource requirements. In

the update framework for the

prospective payment system for

operating costs, we adjust the update

upwards to allow for real case-mix

change, but remove the effects of coding

changes on the case-mix index. We also

remove the effect on total payments of

prior changes to the DRG classifications

and relative weights, in order to retain

budget neutrality for all case-mix indexrelated changes other than patient

severity. (For example, we adjusted for

the effects of the FY 1992 DRG

reclassification and recalibration as part

of our FY 1994 update

recommendation.) The operating

adjustment consists of a reduction for

total observed case-mix change, an

increase for the portion of case-mix

change that we determine is due to real

case-mix change rather than coding

modifications, and an adjustment for the

effect of prior DRG reclassification and

recalibration changes. We have adopted

this case-mix index adjustment in the

capital update framework as well.

For FY 1998, we are projecting a 1.0

percent increase in the case-mix index.

We estimate that real case-mix increase

will equal 0.8 percent in FY 1998.

Therefore, the net adjustment for casemix change in FY 1998 is -0.2

percentage points.

We estimate that DRG reclassification

and recalibration resulted in a 0.0

percent change in the case mix when

compared with the case-mix index that

would have resulted if we had not made

the reclassification and recalibration

changes to the DRGs.

The current operating update

framework contains an adjustment for

forecast error. The input price index

forecast is based on historical trends

and relationships ascertainable at the

time the update factor is established for

the upcoming year. In any given year,

there may be unanticipated price

fluctuations that may result in

differences between the actual increase

in prices faced by hospitals and the

forecast used in calculating the update

factors. In setting a prospective payment

rate under this framework, we make an

adjustment for forecast error only if our

estimate of the capital input price index

rate of increase for any year is off by

0.25 percentage points or more. There is

a 2-year lag between the forecast and the

measurement of the forecast error. Thus,

for example, we would adjust for a

forecast error made in FY 1996 through

an adjustment to the FY 1998 update.

Because we only introduced this

analytical framework in FY 1996, FY
46046 Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations

1998 is the first year in which a forecast

error adjustment could be required. We

estimate that the FY 1996 CIPI was .20

percentage points higher than our

current data show, which means that we

estimate a forecast error of .20

percentage points for FY 1996.

Therefore no adjustment for forecast

error will be made in FY 1998.

Under the capital prospective

payment system framework, we also

make an adjustment for changes in

intensity. We calculate this adjustment

using the same methodology and data as

in the framework for the operating

prospective payment system. The

intensity factor for the operating update

framework reflects how hospital

services are utilized to produce the final

product, that is, the discharge. This

component accounts for changes in the

use of quality-enhancing services,

changes in within-DRG severity, and

expected modification of practice

patterns to remove cost-ineffective

services.

We calculate case-mix constant

intensity as the change in total charges

per admission, adjusted for price level

changes (the CPI hospital component),

and changes in real case mix. The use

of total charges in the calculation of the

proposed intensity factor makes it a

total intensity factor, that is, charges for

capital services are already built into the

calculation of the factor. We have,

therefore, incorporated the intensity

adjustment from the operating update

framework into the capital update

framework. Without reliable estimates

of the proportions of the overall annual

intensity increases that are due,

respectively, to ineffective practice

patterns and to the combination of

quality-enhancing new technologies and

within-DRG complexity, we assume, as

in the revised operating update

framework, that one-half of the annual

increase is due to each of these factors.

The capital update framework thus

provides an add-on to the input price

index rate of increase of one-half of the

estimated annual increase in intensity to

allow for within-DRG severity increases

and the adoption of quality-enhancing

technology.

For FY 1998, we have developed a

Medicare-specific intensity measure

based on a 5-year average using FY

1991–1995. In determining case-mix

constant intensity, we found that

observed case-mix increase was 2.8

percent in FY 1991, 1.8 percent in FY

1992, 0.9 percent in FY 1993, 0.8

percent in FY 1994, 1.7 percent in FY

1995, and 1.6 percent in FY 1996. For

FY 1992, FY 1995, and FY 1996, we

estimate that real case-mix increase was

1.0 to 1.4 percent each year. The

estimate for those years is supported by

past studies of case-mix change by the

RAND Corporation. The most recent

study was ‘‘Has DRG Creep Crept Up?

Decomposing the Case Mix Index

Change Between 1987 and 1988’’ by G.

M. Carter, J. P. Newhouse, and D. A.

Relles, R–4098–HCFA/ProPAC(1991).

The study suggested that real case-mix

change was not dependent on total

change, but was rather a fairly steady

1.0 to 1.5 percent per year. We use 1.4

percent as the upper bound because the

RAND study did not take into account

that hospitals may have induced doctors

to document medical records more

completely in order to improve

payment. Following that study, we

consider up to 1.4 percent of observed

case-mix change as real for FY 1991

through FY 1995. Based on this

analysis, we believe that all of the

observed case-mix increase for FY 1993

and FY 1994 is real.

We calculate case-mix constant

intensity as the change in total charges

per admission, adjusted for price level

changes (the CPI hospital component),

and changes in real case-mix. Given

estimates of real case-mix increase of 1.0

percent for FY 1992, 0.9 percent for FY

1993, 0.8 percent for FY 1994, 1.0

percent for FY 1995, and 1.0 percent for

FY 1996, we estimate that case-mix

constant intensity declined by an

average 1.4 percent during FYs 1992

through 1996, for a cumulative decrease

of 7.0 percent. If we assume that real

case-mix increase was 1.4 percent for

FY 1992, 0.9 percent for FY 1993, 0.8

percent for FY 1994, 1.4 percent for FY

1995, and 1.4 percent for FY 1996, we

estimate that case-mix constant

intensity declined by an average 1.6

percent during FYs 1992 through 1996,

for a cumulative decrease of 7.5 percent.

Since we estimate that intensity has

declined during that period, we are

recommending a 0.0 percent intensity

adjustment for FY 1998.

b. Comparison of HCFA and ProPAC

Update Recommendations. In

Recommendation 4 of the proposed

rule, ProPAC recommended a zero

update to the standard Federal rate, and

we recommended a 1.1 percent update.

(See the June 2, 2997 proposed rule for

a discussion of the differences between

the ProPAC and HCFA update

frameworks (62 FR 29950). In this final

rule with comment period, as discussed

in the previous section, we are

implementing a 0.9 update to the capital

rate. ProPAC recommended a zero

update to the rate for FY 1998 because

it believed that a zero update applied to

revised base rates would permit

hospitals to maintain quality of care

while meeting Medicare’s responsibility

to act as a prudent purchaser.

Comment: In response to our

statements in the proposed rule about

why we recommended an update to the

capital rate, ProPAC stated that it had

applied the same reasoning for

recommending a zero update to the

capital rate that it had used in

recommending a zero update to the

operating rate. ProPAC restated its belief

that a zero update was appropriate for

both the operating and capital rates.

Response: As required by Pub. L. 105–

33, we are implementing a 17.78 percent

reduction to the unadjusted standard

Federal capital payment rate and the

unadjusted hospital-specific rate

effective October 1, 1997. To the extent

this statutory reduction to the base

capital rate addresses the issues of the

rates being overstated, we believe we

should not, at the same time, further

address the issue through the update

framework.

2. Outlier Payment Adjustment Factor

Section 412.312(c) establishes a

unified outlier methodology for

inpatient operating and inpatient

capital-related costs. A single set of

thresholds is used to identify outlier

cases for both inpatient operating and

inpatient capital-related payments. We

note that as indicated in section V of the

preamble, in conjunction with our

policy of a unified outlier methodology

for operating and capital, we are

adopting the change required by Pub. L.

105–33 concerning outlier payments.

The law requires the fixed loss cost

outlier threshold to be based on the sum

of the base DRG payment, indirect

medical education (IME) payment and

the disproportionate share hospital

(DSH) payment effective with

discharges occurring on or after October

1, 1997.

Outlier payments are made only on

the portion of the Federal rate that is

used to calculate the hospital’s inpatient

capital-related payments (for example,

70 percent for cost reporting periods

beginning in FY 1998 for hospitals paid

under the fully prospective

methodology). Section 412.308(c)(2)

provides that the standard Federal rate

for inpatient capital-related costs be

reduced by an adjustment factor equal

to the estimated proportion of outlier

payments under the Federal rate to total

inpatient capital-related payments

under the Federal rate. The outlier

thresholds are set so that operating

outlier payments are projected to be 5.1

percent of total operating DRG

payments. The inpatient capital-related

outlier reduction factor reflects the

inpatient capital-related outlier
Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations 46047

payments that would be made if all

hospitals were paid according to 100

percent of the Federal rate. For purposes

of calculating the outlier thresholds and

the outlier reduction factor, we model

all hospitals as if they were paid 100

percent of the Federal rate because, as

explained above, outlier payments are

made only on the portion of the Federal

rate that is included in the hospital’s

inpatient capital-related payments.

In the August 30, 1996 final rule, we

estimated that outlier payments for

capital in FY 1997 would equal 5.19

percent of inpatient capital-related

payments based on the Federal rate.

Accordingly, we applied an outlier

adjustment factor of 0.9481 to the

Federal rate. Based on the thresholds as

set forth in section II.A.4.d of this

Addendum, we estimate that outlier

payments for capital will equal 6.18

percent of inpatient capital-related

payments based on the Federal rate in

FY 1998. We are, therefore, applying an

outlier adjustment factor of 0.9382 to

the Federal rate. Thus, estimated capital

outlier payments for FY 1998 represent

a higher percentage of total capital

standard payments than for FY 1997.

The outlier reduction factors are not

built permanently into the rates; that is,

they are not applied cumulatively in

determining the Federal rate. Therefore,

the net change in the outlier adjustment

to the Federal rate for FY 1998 is 0.9896

(0.9382/0.9481). Thus, the outlier

adjustment decreases the FY 1998

Federal rate by 1.04 percent (1 ¥0.9896)

compared with the FY 1997 outlier

adjustment.

3. Budget Neutrality Adjustment Factor

for Changes in DRG Classifications and

Weights and the Geographic Adjustment

Factor

Section 412.308(c)(4)(ii) requires that

the Federal rate be adjusted so that

aggregate payments for the fiscal year

based on the Federal rate after any

changes resulting from the annual DRG

reclassification and recalibration, and

changes in the geographic adjustment

factor (GAF) are projected to equal

aggregate payments that would have

been made on the basis of the Federal

rate without such changes. We use the

actuarial model described in Appendix

B to estimate the aggregate payments

that would have been made on the basis

of the Federal rate without changes in

the DRG classifications and weights and

in the GAF. We also use the model to

estimate aggregate payments that would

be made on the basis of the Federal rate

as a result of those changes. We then use

these figures to compute the adjustment

required to maintain budget neutrality

for changes in DRG weights and in the

GAF.

For FY 1997, we calculated a GAF/

DRG budget neutrality factor of 0.9987.

In the proposed rule for FY 1998, we

proposed a GAF/DRG budget neutrality

factor of 1.0001. In this final rule with

comment period, based on calculations

using updated data, we are applying a

factor of 0.9989 to meet this

requirement. The GAF/DRG budget

neutrality factors are built permanently

into the rates; that is, they are applied

cumulatively in determining the Federal

rate. This follows from the requirement

that estimated aggregate payments each

year be no more or less than they would

have been in the absence of the annual

DRG reclassification and recalibration

and changes in the GAF. The

incremental change in the adjustment

from FY 1997 to FY 1998 is 0.9989. The

cumulative change in the rate due to

this adjustment is 1.0001 (the product of

the incremental factors for FY 1993, FY

1994, FY 1995, FY 1996, FY 1997, and

FY 1998: 0.9980 × 1.0053 × 0.9998 ×

0.9994 × 0.9987 × 0.9989=1.0001).

This factor accounts for DRG

reclassifications and recalibration and

for changes in the GAF. It also

incorporates the effects on the GAF of

FY 1998 geographic reclassification

decisions made by the MGCRB

compared to FY 1997 decisions.

However, it does not account for

changes in payments due to changes in

the disproportionate share and indirect

medical education adjustment factors or

in the large urban add-on.

4. Exceptions Payment Adjustment

Factor

Section 412.308(c)(3) requires that the

standard Federal rate for inpatient

capital-related costs be reduced by an

adjustment factor equal to the estimated

proportion of additional payments for

exceptions under § 412.348 relative to

total payments under the hospitalspecific rate and Federal rate. We use an

actuarial model described in Appendix

B to determine the exceptions payment

adjustment factor.

For FY 1997, we estimated that

exceptions payments would equal 6.42

percent of aggregate payments based on

the Federal rate and the hospitalspecific rate. Therefore, we applied an

exceptions reduction factor of 0.9358

(1—0.0642) in determining the FY 1997

Federal rate. For FY 1998, we estimated

in the June 2, 1997 proposed rule that

exceptions payments would equal 7.24

percent of aggregate payments based on

the Federal rate and the hospitalspecific rate. Therefore we proposed to

apply an exceptions payment reduction

factor of .9276 (1—0.0724) to determine

the FY 1998 Federal rate. For this final

rule with comment period, we estimate

that exceptions payments for FY 1998

will equal 3.41 percent of aggregate

payments based on the Federal rate and

the hospital-specific rate. We are,

therefore, applying an exceptions

payment reduction factor of 0.9659 (1—

0.0341) to the Federal rate for FY 1998.

The final exceptions reduction factor

for FY 1998 is thus 3.22 percent higher

than the factor for FY 1997 and 4.13

percent higher than the factor in the FY

1998 proposed rule. This change is due

to a modeling refinement we have

implemented since publication of the

proposed rule described in Appendix B.

The exceptions reduction factors are not

built permanently into the rates; that is,

the factors are not applied cumulatively

in determining the Federal rate.

Therefore, the net adjustment for

exceptions to the FY 1998 Federal rate

over the FY 1997 Federal rate is 0.9659/

0.9358, or 1.0322.

5. Standard Capital Federal Rate for FY

1998

For FY 1997, the capital Federal rate

was $438.92. With the changes we

proposed to the factors used to establish

the Federal rate, we proposed that the

FY 1998 Federal rate would be $438.43.

In this final rule with comment period,

we are establishing a FY 1998 Federal

rate of $371.51. The Federal rate for FY

1998 was calculated as follows:

• The FY 1998 update factor is .0090,

that is, the update is 0.9 percent.

• The FY 1998 budget neutrality

adjustment factor that is applied to the

standard Federal payment rate for

changes in the DRG relative weights and

in the GAF is 0.9989.

• The FY 1998 outlier adjustment

factor is 0.9382.

• The FY 1998 exceptions payments

adjustment factor is 0.9659.

Since the Federal rate has already

been adjusted for differences in case

mix, wages, cost of living, indirect

medical education costs, and payments

to hospitals serving a disproportionate

share of low-income patients, we have

made no additional adjustments in the

standard Federal rate for these factors

other than the budget neutrality factor

for changes in the DRG relative weights

and the GAF.

We are providing a chart that shows

how each of the factors and adjustments

for FY 1998 affected the computation of

the FY 1998 Federal rate in comparison

to the FY 1997 Federal rate. We have

added the effect of the 17.78 percent

reduction to the rate required by Public

Law 105–33 to the chart. The FY 1998

update factor has the effect of increasing

the Federal rate by 0.90 percent
46048 Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations

compared to the rate in FY 1997, while

the final geographic and DRG budget

neutrality factor has the effect of

decreasing the Federal rate by 0.11

percent. The FY 1998 outlier adjustment

factor has the effect of decreasing the

Federal rate by 1.04 percent compared

to FY 1997. The FY 1998 exceptions

reduction factor has the effect of

increasing the Federal rate by 3.22

percent compared to the exceptions

reduction for FY 1997. The combined

effect of all the changes is to decrease

the Federal rate by 15.36 percent

compared to the Federal rate for FY

1997.

Comparison of Factors and

Adjustments: FY 1997 Federal Rate and

FY 1998 Federal Rate

FY 97 FY 98 Change Percent

change

Public Law 105–33 Standard Federal Rate Reduction .................................... NA 0.8222 0.8222 ¥17.78

Update factor 1 .................................................................................................. 1.0070 1.0090 1.0090 0.90

GAF/DRG Adjustment Factor 1 ......................................................................... 0.9987 0.9989 0.9989 ¥0.11

Outlier Adjustment Factor 2 ............................................................................... 0.9481 0.9382 0.9896 ¥1.04

Exceptions Adjustment Factor 2 ........................................................................ 0.9358 0.9659 1.0322 3.22

Federal Rate ..................................................................................................... $438.92 $371.51 0.8464 ¥15.36

1The update factor and the GAF/DRG budget neutrality factors are built permanently into the rates. Thus, for example, the incremental change

from FY 1997 to FY 1998 resulting from the application of the 0.9989 GAF/DRG budget neutrality factor for FY 1998 is 0.9989. 2The outlier reduction factor and the exceptions reduction factor are not built permanently into the rates; that is, these factors are not applied

cumulatively in determining the rates. Thus, for example, the net change resulting from the application of the FY 1998 outlier reduction factor is

0.9382/0.9481, or 0.9896.

We are also providing a chart that

shows how the final FY 1998 Federal

rate differs from the proposed FY 1998

Federal rate.

Comparison of Factors and

Adjustments: Proposed FY 1998 Federal

Rate and Final FY 1998 Federal Rate

Proposed

FY 98 Final FY 98 Change Percentchange

Public Law 105–33 Standard Federal Rate Reduction .................................... NA 0.8222 0.8222 ¥17.78

Update factor .................................................................................................... 1.0110 1.0090 0.9980 ¥0.20

GAF/DRG Adjustment Factor ........................................................................... 1.0001 0.9989 0.9988 ¥0.12

Outlier Adjustment Factor ................................................................................. 0.9449 0.9382 0.9929 ¥0.71

Exceptions Adjustment Factor .......................................................................... 0.9276 0.9659 1.0413 4.13

Federal Rate ..................................................................................................... $438.43 $371.51 0.8474 ¥15.26

6. Special Rate for Puerto Rico Hospitals

As explained at the beginning of this

section, in the past, hospitals in Puerto

Rico were paid based on 75 percent of

the Puerto Rico rate and 25 percent of

the Federal rate. To parallel the change

to the Puerto Rico blended payment

amount mandated for operating

payments by Public Law 105–33,

effective with discharges on or after

October 1, 1997, capital payments to

hospitals in Puerto Rico will be based

on 50 percent of the Puerto Rico capital

rate and 50 percent of the Federal rate.

The Puerto Rico rate is derived from the

costs of Puerto Rico hospitals only,

while the Federal rate is derived from

the costs of all acute care hospitals

participating in the prospective

payment system (including Puerto

Rico). To adjust hospitals’ capital

payments for geographic variations in

capital costs, we apply a GAF to both

portions of the blended rate. The GAF

is calculated using the operating PPS

wage index, and varies depending on

the MSA or rural area in which the

hospital is located. Since the GAF is

based on the wage index, we are

revising the method of accounting for

geographical variation in Puerto Rico, to

parallel the change that is being

proposed on the operating rate, where a

Puerto Rico-specific wage index is being

calculated (see section III.B. of this

preamble). Specifically, we used the

new Puerto Rico wage index to

determine the GAF for the Puerto Rico

part of the capital blended rate, and

retained the use of the national wage

index to determine the GAF for the

national part of the blended rate. As

noted above, effective October 1, 1997,

hospitals in Puerto Rico will be paid

based on 50 percent of the Puerto Rico

rate and 50 percent of the Federal rate.

This means that, in computing the

payment for a particular Puerto Rico

hospital, the Puerto Rico portion of the

rate will be multiplied by the Puerto

Rico-specific GAF for the MSA in which

the hospital is located, and the national

portion of the rate will be multiplied by

the national GAF for the MSA in which

the hospital is located (which is

computed from national data for all

hospitals in the United States and

Puerto Rico).

We have adjusted the Puerto Rico rate

to account for the application of Puerto

Rico-specific GAFs. We did this in order

to be consistent with the method by

which we originally determined the

national and Puerto Rico rates. This

resulting standard Puerto Rico rate does

not translate into a reduction in

payments to Puerto Rico hospitals. The

Puerto Rico-specific GAFs are higher

than the national GAFs because they use

the Puerto Rico mean only rather than

the national mean. As a result,

application of Puerto Rico-specific

GAFs means Puerto Rico hospitals

receive more money.

For FY 1997, before application of the

GAF, the special rate for Puerto Rico

hospitals was $337.63. With the changes

we proposed to the factors used to

determine the rate, the proposed FY

1998 special rate for Puerto Rico was

$204.46. In this final rule with comment

period, the FY 1998 capital rate for

Puerto Rico is $177.57. Since

publication of the proposed rule, the

Puerto Rico rate has declined because of

the effect of the 17.78 percent reduction

to the rate implemented as a result of

Public Law 105–33.

B. Determination of Hospital-Specific

Rate Update

Section 412.328(e) of the regulations

provides that the hospital-specific rate

for FY 1998 be determined by adjusting

the FY 1997 hospital-specific rate by the
Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations 46049

hospital-specific rate update factor and

the exceptions payment adjustment

factor. Before application of these

factors the FY 1997 unadjusted hospitalspecific rate was reduced 17.78 percent

to comply with the provisions of Public

Law 105–33. The 17.78 percent

reduction will be in force from October

1, 1997 through September 30, 2002. A

15.68 percent reduction to the

unadjusted hospital specific rate will

remain in effect from October 1, 2002

onward.

1. Impact of Public Law 105–33

Public Law 105–33 reduces the

hospital specific rate 17.78 percent

through September 30, 2002. After that

date a 15.68 percent reduction to the

rate shall remain in effect.

2. Hospital-Specific Rate Update Factor

The hospital-specific rate is updated

in accordance with the update factor for

the standard Federal rate determined

under § 412.308(c)(1). For FY 1998, we

have updated the hospital-specific rate

by a factor of 1.0090.

3. Exceptions Payment Adjustment

Factor

For FYs 1992 through 2001, the

updated hospital-specific rate is

multiplied by an adjustment factor to

account for estimated exceptions

payments for capital-related costs under

§ 412.348, which is determined as a

proportion of the total amount of

payments under the hospital-specific

rate and the Federal rate. For FY 1998,

we estimated in the proposed rule that

exceptions payments would be 7.24

percent of aggregate payments based on

the Federal rate and the hospitalspecific rate. We therefore proposed that

the updated hospital-specific rate be

reduced by a factor of 0.9276. In this

final rule with comment period, we

estimate that exceptions payments will

be 3.53 percent of aggregate payments

based on the Federal rate and the

hospital specific rate. We are applying

an exceptions reduction factor of 0.9659

to the hospital-specific rate.

The exceptions reduction factors are

not built permanently into the rates; that

is, the factors are not applied

cumulatively in determining the

hospital-specific rate. Therefore, the net

adjustment to the FY 1998 hospitalspecific rate is 0.9659/0.9358, or 1.0322.

4. Net Change to Hospital-Specific Rate

We are providing a chart to show the

net change to the hospital-specific rate.

The chart shows the factors for FY 1997

and FY 1998 and the net adjustment for

each factor. It also shows that the

cumulative net adjustment from FY

1997 to FY 1998 is 0.8563, which

represents a decrease of 13.66 percent to

the hospital-specific rate. For each

hospital, the FY 1998 hospital-specific

rate is determined by multiplying the

FY 1997 hospital-specific rate by the

cumulative net adjustment of 0.8563.

FY 1998 Update and Adjustments to

Hospital-Specific Rates

FY 97 FY 98 Net adjustment

Percent

change

Public Law 105–33 Hospital-Specific Rate Reduction ..................................... (1) 0.8222 0.8222 ¥17.78

Update Factor ................................................................................................... 1.0070 1.0090 1.0090 0.90

Exceptions Payment Adjustment Factor .......................................................... 0.9358 0.9659 1.0322 3.22

Cumulative Adjustments ................................................................................... 0.9424 0.8070 0.8563 ¥14.37

1 Not applicable.

Note: The update factor for the hospitalspecific rate is applied cumulatively in

determining the rates. Thus, the incremental

increase in the update factor from FY 1997

to FY 1998 is 1.0090. In contrast, the

exceptions payment adjustment factor is not

applied cumulatively. Thus, for example, the

incremental increase in the exceptions

reduction factor from FY 1997 to FY 1998 is

0.9659/0.9358, or 1.0322.

C. Calculation of Inpatient CapitalRelated Prospective Payments for FY

1998

During the capital prospective

payment system transition period, a

hospital is paid for the inpatient capitalrelated costs under one of two

alternative payment methodologies; the

fully prospective payment methodology

or the hold-harmless methodology. The

payment methodology applicable to a

particular hospital is determined when

a hospital comes under the prospective

payment system for capital-related costs

by comparing its hospital-specific rate

to the Federal rate applicable to the

hospital’s first cost reporting period

under the prospective payment system.

The applicable Federal rate was

determined by making adjustments as

follows:

• For outliers by dividing the

standard Federal rate by the outlier

reduction factor for that fiscal year; and,

• For the payment adjustment factors

applicable to the hospital (that is, the

hospital’s GAF, the disproportionate

share adjustment factor, and the indirect

medical education adjustment factor,

when appropriate).

If the hospital-specific rate is above

the applicable Federal rate, the hospital

is paid under the hold-harmless

methodology. If the hospital-specific

rate is below the applicable Federal rate,

the hospital is paid under the fully

prospective methodology.

For purposes of calculating payments

for each discharge under both the holdharmless payment methodology and the

fully prospective payment methodology,

the standard Federal rate is adjusted as

follows: (Standard Federal Rate) × (DRG

weight) × (GAF) × (Large Urban Add-on,

if applicable) × (COLA adjustment for

hospitals located in Alaska and Hawaii)

× (1 + Disproportionate Share

Adjustment Factor + IME Adjustment

Factor, if applicable). The result is

termed the adjusted Federal rate.

Payments under the hold-harmless

methodology are determined under one

of two formulas. A hold-harmless

hospital is paid the higher of:

• 100 percent of the adjusted Federal

rate for each discharge; or

• An old capital payment equal to 85

percent (100 percent for sole community

hospitals) of the hospital’s allowable

Medicare inpatient old capital costs per

discharge for the cost reporting period

plus a new capital payment based on a

percentage of the adjusted Federal rate

for each discharge. The percentage of

the adjusted Federal rate equals the ratio

of the hospital’s allowable Medicare

new capital costs to its total Medicare

inpatient capital-related costs in the cost

reporting period.

Once a hospital receives payment

based on 100 percent of the adjusted

Federal rate in a cost reporting period

beginning on or after October 1, 1994 (or

the first cost reporting period after

obligated capital that is recognized as

old capital under § 412.302(c) is put in

use for patient care, if later), the hospital

continues to receive capital prospective

payment system payments on that basis

for the remainder of the transition

period.

Payment for each discharge under the

fully prospective methodology is the

sum of:
46050 Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations

• The hospital-specific rate

multiplied by the DRG relative weight

for the discharge and by the applicable

hospital-specific transition blend

percentage for the cost reporting period;

and

• The adjusted Federal rate

multiplied by the Federal transition

blend percentage.

The blend percentages for cost

reporting periods beginning in FY 1998

are 70 percent of the adjusted Federal

rate and 30 percent of the hospitalspecific rate.

Hospitals may also receive outlier

payments for those cases that qualify

under the thresholds established for

each fiscal year. Section 412.312(c)

provides for a single set of thresholds to

identify outlier cases for both inpatient

operating and inpatient capital-related

payments. Outlier payments are made

only on that portion of the Federal rate

that is used to calculate the hospital’s

inpatient capital-related payments. For

fully prospective hospitals, that portion

is 70 percent of the Federal rate for

discharges occurring in cost reporting

periods beginning during FY 1998.

Thus, a fully prospective hospital will

receive 70 percent of the capital-related

outlier payment calculated for the case

for discharges occurring in cost

reporting periods beginning in FY 1998.

For hold-harmless hospitals paid 85

percent of their reasonable costs for old

inpatient capital, the portion of the

Federal rate that is included in the

hospital’s outlier payments is based on

the hospital’s ratio of Medicare

inpatient costs for new capital to total

Medicare inpatient capital costs. For

hold-harmless hospitals that are paid

100 percent of the Federal rate, 100

percent of the Federal rate is included

in the hospital’s outlier payments.

The outlier thresholds for FY 1998 are

published in section II.A.4.c of this

Addendum. For FY 1998, a case

qualifies as a cost outlier if the cost for

the case is greater than the sum of the

prospective payment rate for the DRG

plus IME and DSH payments plus

$11,050. During the capital prospective

payment system transition period, a

hospital may also receive an additional

payment under an exceptions process if

its total inpatient capital-related

payments are less than a minimum

percentage of its allowable Medicare

inpatient capital-related costs. The

minimum payment level is established

by class of hospital under § 412.348.

The minimum payment levels for

portions of cost reporting periods

occurring in FY 1998 are:

• Sole community hospitals (located

in either an urban or rural area), 90

percent;

• Urban hospitals with at least 100

beds and a disproportionate share

patient percentage of at least 20.2

percent; and

• Urban hospitals with at least 100

beds that qualify for disproportionate

share payments under § 412.106(c)(2),

80 percent; and

• All other hospitals, 70 percent.

Under § 412.348(d), the amount of the

exceptions payment is determined by

comparing the cumulative payments

made to the hospital under the capital

prospective payment system to the

cumulative minimum payment levels

applicable to the hospital for each cost

reporting period subject to that system.

Any amount by which the hospital’s

cumulative payments exceed its

cumulative minimum payment is

deducted from the additional payment

that would otherwise be payable for a

cost reporting period.

New hospitals are exempted from the

capital prospective payment system for

their first 2 years of operation and are

paid 85 percent of their reasonable costs

during that period. A new hospital’s old

capital costs are its allowable costs for

capital assets that were put in use for

patient care on or before the later of

December 31, 1990 or the last day of the

hospital’s base year cost reporting

period, and are subject to the rules

pertaining to old capital and obligated

capital as of the applicable date.

Effective with the third year of

operation, we will pay the hospital

under either the fully prospective

methodology, using the appropriate

transition blend in that Federal fiscal

year, or the hold-harmless methodology.

If the hold-harmless methodology is

applicable, the hold-harmless payment

for assets in use during the base period

would extend for 8 years, even if the

hold-harmless payments extend beyond

the normal transition period.

D. Capital Input Price Index

1. Background

Like the prospective payment hospital

operating input price index, the Capital

Input Price Index (CIPI) is a fixedweight price index. A fixed-weight price

index measures how much it would cost

at a later date to purchase the same mix

of goods and services purchased in the

base period. For the prospective

payment hospital operating and capital

input price indices, the base period is

selected and cost category weights are

determined using available data on

hospitals. Next, appropriate price proxy

indices are chosen for each cost

category. Then a price proxy index level

for each expenditure category is

multiplied by the comparable cost

category weight. The sum of these

products (that is, weights multiplied by

price proxy index levels) for all cost

categories yields the composite index

level of the market basket for a given

year. Repeating the step for other years

produces a time series of composite

market basket index levels. Dividing an

index level by a later index level

produces a rate of growth in the input

price index. Since the percent change is

computed for the fixed mix of total

capital inputs with a 1992 base, the

index is fixed-weight.

Like the operating input price index,

the CIPI measures the price changes

associated with costs during a given

year. In order to do so, the CIPI must

differ from the operating input price

index in one important aspect. The CIPI

must reflect the vintage nature of

capital, which is the acquisition and use

of capital over time. Capital expenses in

any given year are determined by the

stock of capital in that year (that is,

capital that remains on hand from all

current and prior capital acquisitions).

An index measuring capital price

changes needs to reflect this vintage

nature of capital. Therefore, the CIPI

was developed to capture the vintage

nature of capital by using a weightedaverage of past capital purchase prices

up to and including the current year.

Using Medicare cost reports, AHA

data, and Securities Data Corporation

data, a vintage-weighted price index

was developed to measure price

increases associated with capital

expenses. We periodically update the

base year for the operating and capital

input prices to reflect the changing

composition of inputs for operating and

capital expenses. Currently, the CIPI is

based to FY 1992 and was last rebased

in 1997. The most recent explanation of

the CIPI was discussed in the proposed

rule for FY 1998 published in the June

2, 1997 Federal Register (62 FR 29953).

The following Federal Register

documents also describe development

and revisions of the methodology

involved with the construction of the

CIPI: September 1, 1992 (57 FR 40016),

May 26, 1993 (58 FR 30448), September

1, 1993 (58 FR 46490), May 27, 1994 (59

FR 27876), September 1, 1994 (59 FR

45517), June 2, 1995 (60 FR 29229), and

September 1, 1995 (60 FR 45815), May

31, 1996 (61 FR 27466), and August 30,

1996 (61 FR 46196).

2. Research on Reweighting the CIPI

After analyzing various data sources

and methodologies for determining

capital weights for the HCFA PPS CIPI,

we will continue to use the weights

published in the August 30, 1996

Federal Register (61 FR 46196). We
Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations 46051

explained in the June 2, 1997 proposed

rule that we had decided not to use the

1992 Department of Commerce Asset

and Expenditure data to revise the cost

category weights in the CIPI. The three

reasons why we are staying with the

current HCFA PPS CIPI cost category

weights are: (1) HCFA’s prefers to

continue to use the Medicare Cost

Reports for the Medicare subset of

hospitals (PPS only); (2) the detail

needed for future rebasing of the index

will be available from the Medicare Cost

Reports; and (3) the CIPI cost shares are

similar to those provided by the 1992

Asset and Expenditures Survey. We

received no comments on this issue.

3. Forecast of the CIPI for Federal Fiscal

Year 1998

DRI forecasts a 1.1 percent increase in

the CIPI for FY 1998. This is the

outcome of a projected 2.2 percent

increase in vintage-weighted

depreciation prices (building and fixed

equipment, and movable equipment)

and a 3.2 percent increase in other

capital expense prices in FY 1998,

partially offset by a 2.0 percent decline

in vintage-weighted interest rates in FY

1998. The weighted average of these

three factors produces the 1.1 percent

increase for the CIPI as a whole.

IV. Changes to Payment Rates for

Excluded Hospitals and Hospital Units:

Rate-of-Increase Percentages

A. Rate-of-Increase Percentages for

Excluded Hospitals and Hospital Units

The inpatient operating costs of

hospitals and hospital units excluded

from the prospective payment system

are subject to rate-of-increase limits

established under the authority of

section 1886(b) of the Act, which is

implemented in § 413.40 of the

regulations. Under these limits, an

annual target amount (expressed in

terms of the inpatient operating cost per

discharge) is set for each hospital, based

on the hospital’s own historical cost

experience trended forward by the

applicable rate-of-increase percentages

(update factors). The target amount is

multiplied by the number of Medicare

discharges in a hospital’s cost reporting

period, yielding the ceiling on aggregate

Medicare inpatient operating costs for

the cost reporting period.

Each hospital’s target amount is

adjusted annually, at the beginning of

its cost reporting period, by an

applicable rate-of-increase percentage.

Section 1886(b)(3)(B) of the Act

provides that for cost reporting periods

beginning on or after October 1, 1997

and before October 1, 1998, the rate- ofincrease percentage is 0. In order to

determine a hospital’s target amount for

its cost reporting period beginning in FY

1998, the hospital’s target amount for its

cost reporting period that began in FY

1997 is increased by 0. In addition, as

indicated in section VII of the preamble,

Public Law 105–33 significantly altered

several aspects of payments for

excluded hospitals and units, effective

for cost reporting periods beginning on

or after October 1, 1997. Section 4413 of

Public Law 105–33 permits certain

excluded hospitals—hospitals that were

excluded for the cost reporting period

beginning before October 1, 1990 and

are within certain specified classes, as

well as ‘‘qualified long-term care

hospitals’’—to elect a rebasing of the

hospital’s target amount for the 12-

month cost reporting period beginning

during FY 1998. The rebased target

amount for a hospital would reflect

operating costs in recent cost reporting

periods. Section 4414 establishes a cap

on target amounts for certain classes of

excluded hospitals, based on target

amounts for hospitals in the same class,

for cost reporting periods beginning

during FY 1998. Section 4415 revises

the formulas for determining bonus and

relief payments for excluded hospitals

and also establishes an additional bonus

payment for continuous improvement,

for cost reporting periods beginning

during FY 1998. Finally, sections 4416

and 4419 establish a new statutory

payment methodology for new

hospitals, effective October 1, 1997.

B. Wage Index Exceptions for Excluded

Hospitals and Units

In the August 30, 1991 final rule (56

FR 43232), we set forth our policy for

target amount adjustments for

significant wage increases. Effective

with cost reporting periods beginning

on or after April 1, 1990, significant

increases in wages since the base period

are recognized as a basis for an

adjustment in the target amount under

§ 413.40(g).

To qualify for an adjustment, the

excluded hospital or hospital unit must

be located in a labor market area for

which the average hourly wage

increased significantly more than the

national average hourly wage between

the hospital’s base period and the

period subject to the ceiling. We use the

hospital wage index for prospective

payment hospitals to determine the rate

of increase in the average hourly wage

in the labor market area. For a hospital

to qualify for an adjustment, the wage

index value for the cost reporting period

subject to the ceiling must be at least 8

percent higher than the wage index

based on wage survey data collected for

the base year cost reporting period. If

survey data are not available for one (or

both) of the cost reporting periods used

in the comparison, the wage index

based on the latest available survey data

collected before that cost reporting

period will be used. For example, to

make the comparison between a 1983

base period and a hospital’s cost

reporting period beginning in FY 1995,

we would use the rate of increase

between the wage index based on 1982

wage data and the wage index based on

the FY 1994 data, since the FY 1994

data are the most recent data currently

available. Further, the comparison is

made without regard to geographic

reclassifications made by the MGCRB

under sections 1886(d) (8) and (10) of

the Act. Therefore, the comparison is

made based on the wage index value of

the labor market area in which the

hospital is actually located.

We determine the amount of the

adjustment for wage increases by

considering three factors for the time

between the base period and the period

for which an adjustment is requested:

the rate of increase in the hospital’s

average hourly wage; the rate of increase

in the average hourly wage in the labor

market area in which the hospital is

located; and, the rate of increase in the

national average hourly wage for

hospital workers. The adjustment is

limited to the amount by which the

lower of the hospital’s or the labor

market area’s rate of increase in average

hourly wages significantly exceeds the

national increase (that is, exceeds the

national rate of increase by more than 8

percent). For purposes of computing the

adjustment, the relative rate of increase

in the average hourly wage for the labor

market area is assumed to have been the

same over each of the intervening years

between the wage surveys.

To determine the rate of increase in

the national average hourly wage, we

use the average hourly earnings (AHE)

component of the wages and salaries

portion of the market basket. This

measure is derived from the 1982-based

market basket since the 1987-based

market basket uses the employment cost

index (ECI) for hospital workers as the

price proxy for this component. Unlike

the AHE, the ECI for hospital workers

can be measured historically only back

to 1986. In addition, the ECI does not

adjust for skill-mix shifts and, therefore,

measures only the change in wage rates

per hour.

The average hourly earnings for

hospital workers show the following

increases:

1992 = 4.8 percent

1993 = 3.6 percent

1994 = 2.7 percent

1995 = 3.3 percent
46052 Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations

1996 = 3.1 percent

1997 = 2.2 percent

1998 = 3.2 percent

We note that this section merely

provides updated information with

respect to areas that would qualify for

the wage index adjustment under

§ 413.30(g). This information was

calculated in accordance with

established policy and does not reflect

any change in that policy. The

geographic areas in which the

percentage difference in wage indexes

was sufficient to qualify for a wage

index adjustment are listed in Table 10

of section V of the addendum to this

final rule with comment period.

V. Tables

This section contains the tables

referred to throughout the preamble to

this final rule with comment period and

in this Addendum. For purposes of this

final rule with comment period, and to

avoid confusion, we have retained the

designations of Tables 1 through 5 that

were first used in the September 1, 1983

initial prospective payment final rule

(48 FR 39844). Tables 1A, 1C, 1D, 1E,

1F, 3C, 4A, 4B, 4C, 4D, 4E, 4F, 5, 6A,

6B, 6C, 6D, 6E, 6F, 7A, 7B, 8A, 8B, and

10 are presented below. The tables

presented below are as follows:

Table 1A—National Adjusted Operating

Standardized Amounts, Labor/

Nonlabor

Table 1C—Adjusted Operating

Standardized Amounts for Puerto

Rico, Labor/Nonlabor

Table 1D—Capital Standard Federal

Payment Rate

Table 1E—National Adjusted Operating

Standardized Amounts for

‘‘Temporary Relief’’ Hospitals,

Labor/Nonlabor

Table 1F—Adjusted Operating

Standardized Amounts for

‘‘Temporary Relief’’ Hospitals in

Puerto Rico, Labor/Nonlabor

Table 3C—Hospital Case Mix Indexes

for Discharges Occurring in Federal

Fiscal Year 1996 and Hospital

Average Hourly Wage for Federal

Fiscal Year 1998 Wage Index

Table 4A—Wage Index and Capital

Geographic Adjustment Factor

(GAF) for Urban Areas

Table 4B—Wage Index and Capital

Geographic Adjustment Factor

(GAF) for Rural Areas

Table 4C—Wage Index and Capital

Geographic Adjustment Factor

(GAF) for Hospitals That Are

Reclassified

Table 4D—Average Hourly Wage for

Urban Areas

Table 4E—Average Hourly Wage for

Rural Areas

Table 4F—Puerto Rico Wage Index and

Capital Geographic Adjustment

Factor (GAF)

Table 5—List of Diagnosis Related

Groups (DRGs), Relative Weighting

Factors, Geometric Mean Length of

Stay, and Arithmetic Mean Length

of Stay Points Used in the

Prospective Payment System

Table 6A—New Diagnosis Codes

Table 6B—New Procedure Codes

Table 6C—Invalid Diagnosis Codes

Table 6D—Revised Diagnosis Code

Titles

Table 6E—Additions to the CC

Exclusions List

Table 6F—Deletions to the CC

Exclusions List

Table 7A—Medicare Prospective

Payment System Selected Percentile

Lengths of Stay FY 96 MEDPAR

Update 06/97 GROUPER V14.0

Table 7B—Medicare Prospective

Payment System Selected Percentile

Lengths of Stay FY 96 MEDPAR

Update 06/97 GROUPER V15.0

Table 8A—Statewide Average Operating

Cost-to-Charge Ratios for Urban and

Rural Hospitals (Case Weighted)

August 1997

Table 8B—Statewide Average Capital

Cost-to-Charge Ratios (Case

Weighted) August 1997

Table 10—Percentage Difference in

Wage Indexes for Areas that Qualify

for a Wage Index Exception for

Excluded Hospitals and Units

TABLE 1A.—NATIONAL ADJUSTED OPERATING STANDARDIZED AMOUNTS, LABOR/NONLABOR

Large urban areas Other areas

Labor-related Nonlabor-related Labor-related Nonlabor-related

2,776.21 1,128.44 2,732.26 1,110.58

TABLE 1C.—ADJUSTED OPERATING STANDARDIZED AMOUNTS FOR PUERTO RICO, LABOR/NONLABOR

Large urban areas Other areas

Labor Nonlabor Labor Nonlabor

National ............................................................................................................................. 2,752.36 1,118.74 2,752.36 1,118.74

Puerto Rico ....................................................................................................................... 1,323.01 532.55 1,302.07 524.11

TABLE 1D.—CAPITAL STANDARD FEDERAL PAYMENT RATE

Rate

National .................................................................................................................................................................................................... 371.51

Puerto Rico .............................................................................................................................................................................................. 177.57

TABLE 1E.—NATIONAL ADJUSTED OPERATING STANDARDIZED AMOUNTS FOR ‘‘TEMPORARY RELIEF’’ HOSPITALS, LABOR/

NONLABOR

Large urban areas Other areas

Labor-related Nonlabor-related Labor-related Nonlabor-related

2,790.09 1,134.08 2,745.92 1,116.13
Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations 46053

TABLE 1F.—ADJUSTED OPERATING STANDARDIZED AMOUNTS FOR ‘‘TEMPORARY RELIEF’’ HOSPITALS IN PUERTO RICO,

LABOR/NONLABOR

Large urban areas Other areas

Labor Nonlabor Labor Nonlabor

National ............................................................................................................................. 2,766.12 1,124.33 2,766.12 1,124.33

Puerto Rico ....................................................................................................................... 1,329.63 535.21 1,308.58 526.73
46054 Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations

TABLE 3C.—HOSPITAL CASE MIX INDEXES FOR DISCHARGES OCCURRING IN FEDERAL FISCAL YEAR 1996; HOSPITAL

AVERAGE HOURLY WAGE FOR FEDERAL FISCAL YEAR 1998 WAGE INDEX

PAGE 1 OF 16

Provider

Case

mix

index

Avg.

hour

wage

Provider

Case

mix

index

Avg.

hour

wage

Provider

Case

mix

index

Avg.

hour

wage

Provider

Case

mix

index

Avg.

hour

wage

Provider

Case

mix

index

Avg.

hour

wage

010001 ..... 01.4825 15.78 010095 ..... 00.9801 12.06 030004 ..... 01.0972 13.75 040002 ..... 01.1973 12.84 040107 ..... 01.2002 15.29

010004 ..... 00.9676 11.63 010097 ..... 00.9079 14.47 030006 ..... 01.5610 18.02 040003 ..... 01.0165 12.72 040109 ..... 01.1817 13.56

010005 ..... 01.2091 15.74 010098 ..... 01.2489 11.65 030007 ..... 01.3193 16.96 040004 ..... 01.6332 15.84 040114 ..... 01.8852 17.60

010006 ..... 01.4496 15.81 010099 ..... 01.1682 14.38 030008 ..... 02.3016 19.75 040005 ..... 01.0097 12.83 040116 ..... 01.3704 19.05

010007 ..... 01.0711 13.52 010100 ..... 01.2651 15.26 030009 ..... 01.3458 16.25 040007 ..... 01.8429 17.91 040118 ..... 01.2209 14.54

010008 ..... 01.1607 12.11 010101 ..... 01.0607 14.05 030010 ..... 01.4373 17.79 040008 ..... 01.0327 11.22 040119 ..... 01.1544 14.58

010009 ..... 01.1291 15.17 010102 ..... 01.0052 13.60 030011 ..... 01.5237 18.32 040010 ..... 01.3176 15.80 040124 ..... 01.1341 13.82

010010 ..... 01.0737 14.78 010103 ..... 01.8566 18.70 030012 ..... 01.2358 16.41 040011 ..... 00.9916 10.85 040126 ..... 00.9510 11.98

010011 ..... 01.6409 19.62 010104 ..... 01.7062 18.20 030013 ..... 01.2716 19.56 040014 ..... 01.1905 16.40 040132 ..... 00.5050 11.69

010012 ..... 01.3020 16.65 010108 ..... 01.2341 14.48 030014 ..... 01.4919 18.50 040015 ..... 01.2941 13.52 050002 ..... 01.5829 26.90

010015 ..... 01.0958 13.70 010109 ..... 01.1081 13.36 030016 ..... 01.2453 17.47 040016 ..... 01.6692 16.02 050006 ..... 01.4566 19.54

010016 ..... 01.2749 16.88 010110 ..... 01.0520 14.12 030017 ..... 01.5067 18.11 040017 ..... 01.3301 11.89 050007 ..... 01.6171 27.21

010018 ..... 00.9370 16.77 010112 ..... 01.1867 15.28 030018 ..... 01.8034 19.31 040018 ..... 01.2275 18.03 050008 ..... 01.5161 26.68

010019 ..... 01.3226 14.52 010113 ..... 01.6944 15.80 030019 ..... 01.2819 19.75 040019 ..... 01.1380 13.94 050009 ..... 01.7352 29.57

010021 ..... 01.2524 15.75 010114 ..... 01.3212 16.45 030022 ..... 01.4840 17.44 040020 ..... 01.6069 15.06 050013 ..... 01.8362 22.18

010022 ..... 01.0183 17.25 010115 ..... 00.8516 12.02 030023 ..... 01.3266 18.26 040021 ..... 01.2523 14.96 050014 ..... 01.1738 22.16

010023 ..... 01.6476 15.43 010117 ..... 00.8712 13.59 030024 ..... 01.7156 20.56 040022 ..... 01.6750 14.96 050015 ..... 01.3849 23.94

010024 ..... 01.4637 15.95 010118 ..... 01.3326 18.41 030025 ..... 01.1285 14.24 040024 ..... 01.0635 14.26 050016 ..... 01.1630 17.90

010025 ..... 01.4608 13.24 010119 ..... 00.9630 18.53 030027 ..... 01.0548 15.39 040025 ..... 00.9145 12.38 050017 ..... 02.0535 25.36

010027 ..... 00.8284 14.12 010120 ..... 00.9715 15.39 030030 ..... 01.7308 18.21 040026 ..... 01.6072 16.65 050018 ..... 01.3072 20.37

010029 ..... 01.5709 15.54 010121 ..... 01.3052 15.80 030033 ..... 01.2274 15.72 040027 ..... 01.2943 12.96 050021 ..... 01.5250 25.59

010031 ..... 01.2310 15.57 010123 ..... 01.3119 15.81 030034 ..... 01.0042 15.05 040028 ..... 01.0928 11.93 050022 ..... 01.5018 23.58

010032 ..... 00.9628 12.86 010124 ..... 01.3732 13.53 030035 ..... 01.2917 18.82 040029 ..... 01.2903 15.78 050024 ..... 01.3075 21.10

010033 ..... 01.9450 17.81 010125 ..... 01.0057 15.83 030036 ..... 01.1928 18.51 040030 ..... 00.9400 11.36 050025 ..... 01.6846 21.84

010034 ..... 01.0855 12.64 010126 ..... 01.1881 14.11 030037 ..... 02.0983 19.86 040032 ..... 00.9578 10.60 050026 ..... 01.4621 28.03

010035 ..... 01.2533 15.94 010127 ..... 01.3531 16.36 030038 ..... 01.6478 18.39 040035 ..... 00.9687 10.26 050028 ..... 01.3819 15.43

010036 ..... 01.1301 16.08 010128 ..... 01.0004 12.39 030040 ..... 01.1504 16.07 040036 ..... 01.5195 17.87 050029 ..... 01.4308 22.42

010038 ..... 01.3196 17.78 010129 ..... 01.0814 14.62 030041 ..... 00.9799 13.77 040037 ..... 01.1132 11.92 050030 ..... 01.3244 20.23

010039 ..... 01.6833 17.26 010130 ..... 01.0341 14.47 030043 ..... 01.2492 17.86 040039 ..... 01.2296 13.00 050032 ..... 01.2349 26.01

010040 ..... 01.5892 18.14 010131 ..... 01.3381 18.57 030044 ..... 01.0792 16.15 040040 ..... 00.9709 14.02 050033 ..... 01.4525 26.08

010043 ..... 01.1319 10.75 010134 ..... 00.8561 10.10 030046 ..... 00.9632 18.53 040041 ..... 01.3631 15.91 050036 ..... 01.6825 19.57

010044 ..... 01.1616 14.54 010137 ..... 01.2998 16.93 030047 ..... 00.9556 20.45 040042 ..... 01.2352 14.76 050038 ..... 01.4592 28.87

010045 ..... 01.1903 13.53 010138 ..... 00.9272 10.96 030049 ..... 00.9882 14.67 040044 ..... 01.0303 11.22 050039 ..... 01.6258 21.59

010046 ..... 01.5214 16.79 010139 ..... 01.6887 19.60 030054 ..... 00.8543 12.51 040045 ..... 01.0246 15.07 050040 ..... 01.2705 22.01

010047 ..... 00.9795 10.30 010143 ..... 01.2910 16.04 030055 ..... 01.2188 16.56 040047 ..... 01.1375 15.13 050042 ..... 01.3518 20.78

010049 ..... 01.1616 14.77 010144 ..... 01.3015 16.55 030059 ..... 01.3958 18.88 040048 ..... 01.1836 14.02 050043 ..... 01.6121 30.35

010050 ..... 01.1221 13.88 010145 ..... 01.3023 15.68 030060 ..... 01.1372 16.21 040050 ..... 01.1593 12.27 050045 ..... 01.2807 18.28

010051 ..... 00.8513 09.93 010146 ..... 01.1750 15.81 030061 ..... 01.6808 17.13 040051 ..... 01.0998 12.97 050046 ..... 01.2665 21.20

010052 ..... 01.0489 09.88 010148 ..... 01.0002 12.52 030062 ..... 01.2672 15.94 040053 ..... 01.1245 13.04 050047 ..... 01.5727 31.60

010053 ..... 01.0767 13.31 010149 ..... 01.3649 16.73 030064 ..... 01.7564 18.53 040054 ..... 01.0611 12.44 050051 ..... 01.0491 17.04

010054 ..... 01.2094 17.02 010150 ..... 01.1059 16.28 030065 ..... 01.7363 19.65 040055 ..... 01.4707 15.29 050054 ..... 01.2156 20.60

010055 ..... 01.4429 16.99 010152 ..... 01.4925 17.56 030067 ..... 01.0534 15.78 040058 ..... 01.0324 13.64 050055 ..... 01.4024 27.81

010056 ..... 01.4318 18.78 010155 ..... 01.0502 06.99 030068 ..... 01.0784 15.77 040060 ..... 00.9853 10.20 050056 ..... 01.3688 29.73

010058 ..... 01.0898 12.93 020001 ..... 01.5629 26.31 030069 ..... 01.3333 20.13 040062 ..... 01.6840 15.85 050057 ..... 01.5572 19.64

010059 ..... 01.1095 14.92 020002 ..... 01.2556 23.88 030071 ..... 00.9698 .......... 040064 ..... 01.0541 11.01 050058 ..... 01.4522 21.47

010061 ..... 01.1895 15.20 020004 ..... 01.1115 25.46 030072 ..... 00.8317 .......... 040066 ..... 01.2232 15.86 050060 ..... 01.5351 20.46

010062 ..... 01.0358 14.36 020005 ..... 00.8208 25.53 030073 ..... 01.0031 .......... 040067 ..... 01.0943 12.18 050061 ..... 01.4652 21.87

010064 ..... 01.8034 18.52 020006 ..... 01.2585 25.07 030074 ..... 00.9004 .......... 040069 ..... 01.1556 14.87 050063 ..... 01.4029 21.02

010065 ..... 01.3457 15.39 020007 ..... 01.0349 22.76 030075 ..... 00.8568 .......... 040070 ..... 00.9323 13.68 050065 ..... 01.6381 22.82

010066 ..... 00.9479 10.41 020008 ..... 01.1380 28.97 030076 ..... 01.0931 .......... 040071 ..... 01.6768 15.73 050066 ..... 01.2678 20.99

010068 ..... 01.3086 16.70 020009 ..... 00.9789 21.88 030077 ..... 00.8398 .......... 040072 ..... 01.1038 13.94 050067 ..... 01.3721 21.53

010069 ..... 01.1938 13.10 020010 ..... 01.0878 26.44 030078 ..... 01.1397 .......... 040074 ..... 01.3224 14.39 050068 ..... 01.0669 18.92

010072 ..... 01.2125 13.45 020011 ..... 00.9374 22.61 030079 ..... 00.8800 .......... 040075 ..... 01.1151 11.73 050069 ..... 01.6487 24.14

010073 ..... 01.0216 10.41 020012 ..... 01.2409 24.23 030080 ..... 01.5987 21.05 040076 ..... 01.0521 16.33 050070 ..... 01.2795 33.06

010078 ..... 01.2745 16.51 020013 ..... 01.0509 24.21 030083 ..... 01.3190 21.06 040077 ..... 00.9301 11.30 050071 ..... 01.3314 32.76

010079 ..... 01.2576 15.43 020014 ..... 01.1842 22.13 030084 ..... 01.0306 .......... 040078 ..... 01.5579 17.77 050072 ..... 01.3261 32.63

010080 ..... 01.0093 11.89 020017 ..... 01.6662 24.50 030085 ..... 01.5587 23.63 040080 ..... 01.1206 14.65 050073 ..... 01.3306 32.62

010081 ..... 01.8574 14.84 020018 ..... 00.7773 .......... 030086 ..... 01.3371 18.01 040081 ..... 00.9499 10.75 050074 ..... 01.3610 38.56

010083 ..... 01.0102 15.43 020019 ..... 00.7868 .......... 030087 ..... 01.6346 18.93 040082 ..... 01.1559 14.31 050075 ..... 01.3921 32.75

010084 ..... 01.4836 17.66 020020 ..... 00.7621 .......... 030088 ..... 01.4134 19.07 040084 ..... 01.1216 14.18 050076 ..... 01.8221 32.11

010085 ..... 01.2703 17.11 020021 ..... 00.9121 .......... 030089 ..... 01.5854 19.68 040085 ..... 01.1894 14.81 050077 ..... 01.5831 22.86

010086 ..... 01.0808 13.70 020024 ..... 01.0845 23.72 030092 ..... 01.6117 20.36 040088 ..... 01.4011 14.36 050078 ..... 01.2955 24.76

010087 ..... 01.8483 18.51 020025 ..... 00.9808 24.32 030093 ..... 01.4070 17.81 040090 ..... 00.9226 13.54 050079 ..... 01.5781 29.34

010089 ..... 01.2615 15.60 020026 ..... 01.3051 .......... 030094 ..... 01.3544 18.46 040091 ..... 01.2623 19.82 050080 ..... 01.3947 20.59

010090 ..... 01.5853 17.57 020027 ..... 01.0980 .......... 030095 ..... 01.1437 18.24 040093 ..... 01.0361 10.11 050081 ..... 01.7055 22.17

010091 ..... 01.0099 14.57 030001 ..... 01.3356 20.07 030098 ..... 00.9923 .......... 040100 ..... 01.3209 13.29 050082 ..... 01.5529 21.60

010092 ..... 01.4076 16.61 030002 ..... 01.8070 21.04 030099 ..... 00.9435 .......... 040105 ..... 01.0256 13.29 050084 ..... 01.6782 23.55

010094 ..... 01.2351 15.11 030003 ..... 01.9769 20.37 040001 ..... 01.1189 12.95 040106 ..... 01.2151 14.08 050088 ..... 01.0377 23.02
Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations 46055

PAGE 2 OF 16

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050089 ..... 01.4267 20.50 050188 ..... 01.3813 26.63 050298 ..... 01.2567 21.05 050421 ..... 01.3719 24.84 050546 ..... 00.7784 22.14

050090 ..... 01.2947 23.06 050189 ..... 01.0628 21.87 050299 ..... 01.3551 22.62 050423 ..... 01.0305 19.52 050547 ..... 00.8743 21.94

050091 ..... 01.1912 22.02 050191 ..... 01.4969 20.99 050300 ..... 01.3966 22.60 050424 ..... 01.8245 22.86 050549 ..... 01.7309 25.79

050092 ..... 00.9918 15.98 050192 ..... 01.1894 18.17 050301 ..... 01.3386 22.43 050425 ..... 01.3271 33.00 050550 ..... 01.5817 23.60

050093 ..... 01.5676 23.44 050193 ..... 01.3103 23.13 050302 ..... 01.3707 27.57 050426 ..... 01.3357 22.53 050551 ..... 01.2992 24.63

050095 ..... 00.7794 29.00 050194 ..... 01.2778 28.00 050305 ..... 01.5747 30.80 050427 ..... 00.8258 17.79 050552 ..... 01.2447 21.99

050096 ..... 01.3087 19.75 050195 ..... 01.6036 32.79 050307 ..... 01.3606 21.59 050430 ..... 00.8488 17.06 050557 ..... 01.5742 21.58

050097 ..... 01.4627 18.53 050196 ..... 01.4084 17.33 050308 ..... 01.5170 30.55 050431 ..... 01.0903 19.94 050559 ..... 01.4058 24.92

050099 ..... 01.4724 23.23 050197 ..... 01.8388 28.44 050309 ..... 01.3687 24.92 050432 ..... 01.6738 24.04 050560 ..... 01.4220 ..........

050100 ..... 01.7325 28.66 050204 ..... 01.5056 24.18 050310 ..... 01.2220 19.66 050433 ..... 01.1020 17.37 050561 ..... 01.1895 32.17

050101 ..... 01.4330 28.42 050205 ..... 01.3804 17.74 050312 ..... 01.9988 24.11 050434 ..... 01.2082 20.09 050564 ..... 01.1459 17.84

050102 ..... 01.4247 18.79 050207 ..... 01.2943 19.79 050313 ..... 01.2235 21.97 050435 ..... 01.2970 23.02 050565 ..... 01.1268 21.68

050103 ..... 01.6353 26.99 050208 ..... 00.9009 28.76 050315 ..... 01.2143 19.97 050436 ..... 00.9665 14.81 050566 ..... 00.9128 23.47

050104 ..... 01.5264 22.61 050211 ..... 01.3133 30.44 050317 ..... 01.3259 18.92 050438 ..... 01.7470 25.46 050567 ..... 01.6154 24.19

050107 ..... 01.4795 20.75 050213 ..... 01.5197 21.12 050320 ..... 01.3153 27.83 050440 ..... 01.3246 21.46 050568 ..... 01.3628 19.64

050108 ..... 01.7215 21.54 050214 ..... 01.4983 20.90 050324 ..... 01.9108 25.52 050441 ..... 02.0088 28.23 050569 ..... 01.3434 23.05

050109 ..... 02.4142 23.68 050215 ..... 01.5327 28.12 050325 ..... 01.2376 21.42 050443 ..... 00.9266 16.07 050570 ..... 01.7746 23.41

050110 ..... 01.3004 19.33 050217 ..... 01.3523 20.45 050327 ..... 01.5961 22.32 050444 ..... 01.3956 23.98 050571 ..... 01.4447 22.36

050111 ..... 01.3067 19.21 050219 ..... 01.1281 20.76 050328 ..... 01.5403 30.01 050446 ..... 00.9652 21.02 050573 ..... 01.6566 23.85

050112 ..... 01.5376 24.56 050222 ..... 01.5805 30.02 050329 ..... 01.3549 22.38 050447 ..... 01.1512 19.37 050575 ..... 01.1815 ..........

050113 ..... 01.3358 28.10 050224 ..... 01.6094 22.29 050331 ..... 01.4005 26.07 050448 ..... 01.2546 20.75 050577 ..... 01.4076 19.70

050114 ..... 01.4946 20.53 050225 ..... 01.4968 20.67 050333 ..... 01.1112 19.36 050449 ..... 01.3307 20.38 050578 ..... 01.2150 24.65

050115 ..... 01.5823 20.21 050226 ..... 01.3707 23.58 050334 ..... 01.7852 31.52 050454 ..... 01.8478 27.56 050579 ..... 01.5024 27.75

050116 ..... 01.4891 23.17 050228 ..... 01.3742 27.09 050335 ..... 01.4100 21.78 050455 ..... 01.8811 21.07 050580 ..... 01.3773 26.95

050117 ..... 01.3288 20.76 050230 ..... 01.2962 25.94 050336 ..... 01.4158 20.42 050456 ..... 01.1970 20.18 050581 ..... 01.3786 24.80

050118 ..... 01.2326 23.37 050231 ..... 01.6983 24.69 050337 ..... 01.1495 .......... 050457 ..... 01.9759 28.16 050583 ..... 01.6338 23.49

050121 ..... 01.3924 19.17 050232 ..... 01.7470 25.52 050342 ..... 01.3596 18.03 050459 ..... 01.2153 28.95 050584 ..... 01.3161 19.70

050122 ..... 01.7008 25.77 050233 ..... 01.2032 27.97 050343 ..... 01.0652 16.57 050464 ..... 01.8583 23.28 050585 ..... 01.3144 25.79

050124 ..... 01.2435 19.10 050234 ..... 01.3174 22.79 050348 ..... 01.6833 23.57 050468 ..... 01.4947 16.95 050586 ..... 01.3705 21.47

050125 ..... 01.3780 27.26 050235 ..... 01.6162 27.60 050349 ..... 00.9539 14.75 050469 ..... 01.1172 18.34 050588 ..... 01.3156 27.41

050126 ..... 01.4894 23.86 050236 ..... 01.4925 23.47 050350 ..... 01.3637 23.74 050470 ..... 01.1185 18.14 050589 ..... 01.3256 24.78

050127 ..... 01.3466 23.71 050238 ..... 01.5330 22.98 050351 ..... 01.4729 25.97 050471 ..... 01.8600 22.75 050590 ..... 01.4116 23.26

050128 ..... 01.6460 23.71 050239 ..... 01.5401 23.40 050352 ..... 01.3231 23.99 050476 ..... 01.3719 21.89 050591 ..... 01.3412 24.97

050129 ..... 01.6057 20.66 050240 ..... 01.4210 25.28 050353 ..... 01.6090 24.23 050477 ..... 01.5088 26.49 050592 ..... 01.3612 10.96

050131 ..... 01.2856 30.45 050241 ..... 01.1957 25.59 050355 ..... 00.9765 14.97 050478 ..... 00.9877 20.58 050593 ..... 01.2930 29.77

050132 ..... 01.3951 24.69 050242 ..... 01.4391 28.77 050357 ..... 01.6573 22.99 050481 ..... 01.4382 25.47 050594 ..... 01.7808 24.64

050133 ..... 01.3417 21.73 050243 ..... 01.5626 20.95 050359 ..... 01.3024 19.88 050482 ..... 00.9894 17.87 050597 ..... 01.2691 22.40

050135 ..... 01.4325 26.20 050245 ..... 01.4680 22.03 050360 ..... 01.4636 31.81 050483 ..... 01.2210 22.32 050598 ..... 01.3740 28.26

050136 ..... 01.3721 22.84 050248 ..... 01.2419 24.55 050366 ..... 01.4377 20.59 050485 ..... 01.6259 22.39 050599 ..... 01.6899 23.22

050137 ..... 01.4279 33.54 050251 ..... 01.0788 18.41 050367 ..... 01.2687 27.02 050486 ..... 01.4102 24.19 050601 ..... 01.5778 29.22

050138 ..... 01.8973 33.14 050253 ..... 00.4249 18.80 050369 ..... 01.3261 23.77 050488 ..... 01.3907 29.71 050603 ..... 01.4323 20.95

050139 ..... 01.3177 32.31 050254 ..... 01.1834 20.57 050373 ..... 01.4652 23.73 050491 ..... 01.2715 24.39 050604 ..... 01.5612 32.65

050140 ..... 01.3995 31.70 050256 ..... 01.7909 19.46 050376 ..... 01.5358 29.05 050492 ..... 01.3788 21.96 050607 ..... 01.1803 21.26

050144 ..... 01.6110 25.92 050257 ..... 01.1487 21.76 050377 ..... 01.0097 16.14 050494 ..... 01.3412 24.67 050608 ..... 01.3296 18.75

050145 ..... 01.3651 30.22 050260 ..... 00.9841 19.43 050378 ..... 01.1780 21.42 050496 ..... 01.7003 32.52 050609 ..... 01.4420 33.78

050146 ..... 01.3676 .......... 050261 ..... 01.2252 18.54 050379 ..... 01.2054 16.93 050497 ..... 00.7910 .......... 050613 ..... 01.1557 19.90

050147 ..... 00.7180 22.54 050262 ..... 01.9975 26.95 050380 ..... 01.6598 29.85 050498 ..... 01.2875 22.93 050615 ..... 01.6623 25.67

050148 ..... 01.0774 19.07 050264 ..... 01.4160 28.04 050382 ..... 01.4271 22.15 050502 ..... 01.6469 21.94 050616 ..... 01.3571 21.21

050149 ..... 01.5033 22.14 050267 ..... 01.6376 27.72 050385 ..... 01.3306 23.94 050503 ..... 01.3565 23.35 050618 ..... 01.1709 20.05

050150 ..... 01.2365 22.69 050270 ..... 01.3329 22.02 050388 ..... 00.9186 18.08 050506 ..... 01.3762 24.67 050623 ..... 01.1288 23.78

050152 ..... 01.4223 25.51 050272 ..... 01.3322 20.79 050390 ..... 01.2318 22.09 050510 ..... 01.3492 32.12 050624 ..... 01.3769 22.51

050153 ..... 01.6645 27.98 050274 ..... 00.9860 19.47 050391 ..... 01.3459 23.34 050512 ..... 01.5448 33.56 050625 ..... 01.6065 24.95

050155 ..... 01.1105 25.69 050276 ..... 01.1316 26.93 050392 ..... 00.9991 18.23 050515 ..... 01.3429 31.82 050630 ..... 01.4308 21.07

050158 ..... 01.3725 25.37 050277 ..... 01.5097 19.57 050393 ..... 01.4471 23.72 050516 ..... 01.5785 24.92 050633 ..... 01.2932 21.92

050159 ..... 01.3833 21.88 050278 ..... 01.6190 22.89 050394 ..... 01.6194 20.12 050517 ..... 01.3047 20.14 050635 ..... 01.3192 32.09

050167 ..... 01.2762 22.00 050279 ..... 01.2257 21.00 050396 ..... 01.6165 22.02 050522 ..... 01.3442 31.46 050636 ..... 01.4725 22.11

050168 ..... 01.5431 23.71 050280 ..... 01.6873 24.62 050397 ..... 01.0470 18.22 050523 ..... 01.3228 28.96 050638 ..... 01.0334 19.35

050169 ..... 01.5183 22.75 050281 ..... 01.4700 15.36 050401 ..... 01.1317 19.06 050526 ..... 01.3231 24.45 050641 ..... 01.1948 18.27

050170 ..... 01.5727 21.33 050282 ..... 01.3631 23.18 050404 ..... 01.1069 16.60 050528 ..... 01.3531 21.06 050643 ..... 00.7614 ..........

050172 ..... 01.2438 18.44 050283 ..... 01.1136 26.91 050406 ..... 01.0309 15.92 050531 ..... 01.1935 20.24 050644 ..... 00.8951 22.79

050173 ..... 01.3490 20.24 050286 ..... 00.9444 17.82 050407 ..... 01.3244 28.37 050534 ..... 01.4117 24.32 050660 ..... 01.3514 ..........

050174 ..... 01.6348 29.60 050289 ..... 01.8946 26.67 050410 ..... 01.0841 16.71 050535 ..... 01.4595 22.87 050661 ..... 00.8437 20.15

050175 ..... 01.3591 27.08 050290 ..... 01.6535 20.42 050411 ..... 01.3692 31.16 050537 ..... 01.2746 21.53 050662 ..... 00.8759 22.31

050177 ..... 01.2483 20.35 050291 ..... 01.2360 25.51 050414 ..... 01.3039 24.60 050539 ..... 01.2817 22.25 050663 ..... 01.1244 25.63

050179 ..... 01.3109 19.55 050292 ..... 01.0631 21.76 050417 ..... 01.3222 20.22 050541 ..... 01.5423 32.88 050666 ..... 00.8852 20.95

050180 ..... 01.6207 31.19 050293 ..... 01.1601 20.14 050418 ..... 01.3206 22.71 050542 ..... 01.2228 14.92 050667 ..... 00.9877 25.58

050183 ..... 01.1383 20.36 050295 ..... 01.4631 21.39 050419 ..... 01.3474 20.46 050543 ..... 00.9027 21.76 050668 ..... 01.1152 28.90

050186 ..... 01.3308 23.83 050296 ..... 01.2093 22.43 050420 ..... 01.5283 23.03 050545 ..... 00.7751 21.20 050670 ..... 00.8585 ..........
46056 Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations

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050674 ..... 01.2985 30.04 060047 ..... 01.1034 11.84 080004 ..... 01.3471 18.69 100071 ..... 01.3332 16.21 100167 ..... 01.4606 19.21

050675 ..... 01.8407 17.60 060049 ..... 01.4796 17.34 080005 ..... 01.3302 18.53 100072 ..... 01.3115 16.55 100168 ..... 01.3946 20.23

050676 ..... 00.9699 14.37 060050 ..... 01.2714 14.36 080006 ..... 01.3735 19.73 100073 ..... 01.7705 21.99 100169 ..... 01.8544 16.46

050677 ..... 01.4370 34.53 060052 ..... 01.0914 13.04 080007 ..... 01.4046 17.29 100075 ..... 01.5930 18.14 100170 ..... 01.4624 16.86

050678 ..... 01.1143 24.44 060053 ..... 01.0018 14.81 090001 ..... 01.5345 21.36 100076 ..... 01.3531 16.80 100172 ..... 01.3777 13.93

050680 ..... 01.2283 26.19 060054 ..... 01.3927 17.69 090002 ..... 01.2858 19.74 100077 ..... 01.4074 16.10 100173 ..... 01.6794 16.87

050682 ..... 00.9226 15.55 060056 ..... 00.9237 14.05 090003 ..... 01.3454 20.56 100078 ..... 01.1916 16.86 100174 ..... 01.5820 20.80

050684 ..... 01.2016 21.85 060057 ..... 01.0693 21.47 090004 ..... 01.8143 23.95 100079 ..... 01.6005 20.49 100175 ..... 01.2618 16.65

050685 ..... 01.2131 28.69 060058 ..... 00.9407 13.87 090005 ..... 01.3518 17.58 100080 ..... 01.6309 23.98 100176 ..... 02.1175 22.94

050686 ..... 01.3154 32.30 060060 ..... 00.8480 12.53 090006 ..... 01.3509 19.77 100081 ..... 01.0598 17.93 100177 ..... 01.3710 18.76

050688 ..... 01.2787 27.87 060062 ..... 00.9361 14.11 090007 ..... 01.2828 20.38 100082 ..... 01.4572 17.52 100179 ..... 01.6384 19.38

050689 ..... 01.3938 29.96 060063 ..... 00.9516 11.82 090008 ..... 01.5419 23.59 100083 ..... 01.3327 17.98 100180 ..... 01.3734 19.01

050690 ..... 01.5106 32.26 060064 ..... 01.4668 20.71 090010 ..... 01.1704 22.39 100084 ..... 01.4579 18.10 100181 ..... 01.2699 19.10

050693 ..... 01.6216 28.58 060065 ..... 01.3170 21.03 090011 ..... 01.9805 25.13 100085 ..... 01.4188 18.83 100183 ..... 01.3911 19.62

050694 ..... 01.5184 22.78 060066 ..... 00.9696 12.79 090015 ..... 01.1274 .......... 100086 ..... 01.3132 22.05 100187 ..... 01.4032 18.31

050695 ..... 01.0993 25.42 060068 ..... 01.1323 13.46 100001 ..... 01.5737 18.08 100087 ..... 01.8737 21.91 100189 ..... 01.4251 20.96

050696 ..... 02.1091 28.17 060070 ..... 01.0209 16.03 100002 ..... 01.4879 19.10 100088 ..... 01.7306 17.43 100191 ..... 01.3109 18.63

050697 ..... 01.2473 18.05 060071 ..... 01.2383 14.39 100004 ..... 01.0696 13.13 100090 ..... 01.4094 16.46 100199 ..... 01.4361 18.30

050698 ..... 00.8012 .......... 060073 ..... 00.9705 15.25 100006 ..... 01.6454 19.01 100092 ..... 01.4490 16.27 100200 ..... 01.3447 22.72

050699 ..... 00.6001 23.01 060075 ..... 01.3327 21.20 100007 ..... 01.8737 19.63 100093 ..... 01.5386 15.36 100203 ..... 01.3411 19.70

050700 ..... 01.4904 32.32 060076 ..... 01.4838 16.86 100008 ..... 01.7737 20.00 100098 ..... 01.1592 18.36 100204 ..... 01.6730 21.27

050701 ..... 01.3580 29.00 060085 ..... 00.9510 10.30 100009 ..... 01.5015 19.22 100099 ..... 01.2974 13.12 100206 ..... 01.4404 19.98

050702 ..... 00.9243 19.02 060087 ..... 01.7036 21.04 100010 ..... 01.5351 22.50 100102 ..... 01.0900 17.62 100207 ..... 01.0774 20.37

050704 ..... 01.0845 20.41 060088 ..... 01.0231 13.86 100012 ..... 01.6899 16.77 100103 ..... 01.0706 15.41 100208 ..... 01.5784 16.92

050707 ..... 01.0506 25.90 060090 ..... 00.8731 14.19 100014 ..... 01.4574 18.79 100105 ..... 01.4631 18.87 100209 ..... 01.6095 18.40

050708 ..... 00.9919 27.17 060096 ..... 01.0859 21.65 100015 ..... 01.3414 18.06 100106 ..... 01.1228 16.92 100210 ..... 01.6357 19.34

050709 ..... 01.3400 20.44 060100 ..... 01.4754 21.75 100017 ..... 01.5625 16.86 100107 ..... 01.4044 18.26 100211 ..... 01.3504 18.47

050710 ..... 01.3425 .......... 060103 ..... 01.3627 22.66 100018 ..... 01.3521 20.31 100108 ..... 01.0646 13.74 100212 ..... 01.6492 18.75

050711 ..... 02.0900 .......... 060104 ..... 01.2956 21.84 100019 ..... 01.5370 18.40 100109 ..... 01.3642 18.44 100213 ..... 01.5697 18.46

050712 ..... 01.5251 .......... 060107 ..... 01.0652 .......... 100020 ..... 01.3432 20.82 100110 ..... 01.4230 17.14 100217 ..... 01.2974 ..........

050713 ..... 00.8063 .......... 070001 ..... 01.7289 26.42 100022 ..... 01.8823 23.14 100112 ..... 01.0152 12.61 100220 ..... 01.9425 18.82

050714 ..... 01.3579 .......... 070002 ..... 01.7836 26.03 100023 ..... 01.3698 16.89 100113 ..... 02.1189 19.34 100221 ..... 01.6934 19.65

050715 ..... 02.1945 .......... 070003 ..... 01.1170 25.30 100024 ..... 01.4033 19.26 100114 ..... 01.4437 19.70 100222 ..... 01.3988 18.63

060001 ..... 01.6077 20.29 070004 ..... 01.2533 23.33 100025 ..... 01.8800 16.92 100117 ..... 01.3112 18.77 100223 ..... 01.4942 17.42

060003 ..... 01.2643 18.34 070005 ..... 01.4033 25.79 100026 ..... 01.7115 16.88 100118 ..... 01.2401 17.18 100224 ..... 01.4283 21.35

060004 ..... 01.3542 20.06 070006 ..... 01.3414 28.36 100027 ..... 00.9127 14.31 100121 ..... 01.3095 15.75 100225 ..... 01.4063 20.63

060006 ..... 01.1533 16.89 070007 ..... 01.4048 23.69 100028 ..... 01.2619 17.30 100122 ..... 01.3639 16.54 100226 ..... 01.4196 17.73

060007 ..... 01.2498 14.98 070008 ..... 01.2617 23.02 100029 ..... 01.3384 19.04 100124 ..... 01.3668 18.33 100228 ..... 01.3737 20.28

060008 ..... 01.0677 14.75 070009 ..... 01.3499 23.68 100030 ..... 01.4021 18.54 100125 ..... 01.2986 16.50 100229 ..... 01.3312 16.87

060009 ..... 01.4393 19.81 070010 ..... 01.6244 23.63 100032 ..... 01.9493 18.08 100126 ..... 01.4869 19.41 100230 ..... 01.4397 19.70

060010 ..... 01.5808 21.74 070011 ..... 01.3465 25.98 100034 ..... 01.7164 18.88 100127 ..... 01.6995 18.39 100231 ..... 01.6894 16.90

060011 ..... 01.2815 20.17 070012 ..... 01.2220 23.53 100035 ..... 01.6455 17.26 100128 ..... 02.1390 21.19 100232 ..... 01.2868 18.29

060012 ..... 01.4711 17.66 070013 ..... 01.3776 26.05 100038 ..... 01.5655 21.34 100129 ..... 01.2599 17.91 100234 ..... 01.5399 19.22

060013 ..... 01.3100 19.42 070015 ..... 01.4402 24.61 100039 ..... 01.5702 21.69 100130 ..... 01.2298 19.48 100235 ..... 01.4441 18.19

060014 ..... 01.7947 22.41 070016 ..... 01.3413 24.32 100040 ..... 01.6728 17.79 100131 ..... 01.3976 19.68 100236 ..... 01.4010 18.30

060015 ..... 01.5818 20.04 070017 ..... 01.3508 24.82 100043 ..... 01.4510 15.12 100132 ..... 01.3755 15.46 100237 ..... 02.1834 21.32

060016 ..... 01.1928 13.66 070018 ..... 01.4211 27.48 100044 ..... 01.4336 19.86 100134 ..... 01.0399 14.63 100238 ..... 01.5873 17.06

060018 ..... 01.2683 16.89 070019 ..... 01.1945 25.50 100045 ..... 01.4240 16.32 100135 ..... 01.6183 16.63 100239 ..... 01.4590 19.01

060020 ..... 01.6399 16.15 070020 ..... 01.3551 25.82 100046 ..... 01.4939 18.40 100137 ..... 01.3818 21.08 100240 ..... 00.9266 19.10

060022 ..... 01.6763 18.46 070021 ..... 01.2943 25.42 100047 ..... 01.8198 18.47 100138 ..... 00.9577 12.12 100241 ..... 00.9718 13.68

060023 ..... 01.6681 18.98 070022 ..... 01.8465 24.06 100048 ..... 00.9769 12.80 100139 ..... 01.0680 14.97 100242 ..... 01.4999 16.47

060024 ..... 01.7950 23.68 070024 ..... 01.3757 24.79 100049 ..... 01.3204 18.49 100140 ..... 01.1672 17.64 100243 ..... 01.4291 17.93

060027 ..... 01.6711 20.38 070025 ..... 01.8612 25.92 100050 ..... 01.2284 15.21 100142 ..... 01.3319 18.12 100244 ..... 01.4738 18.36

060028 ..... 01.5301 20.69 070026 ..... 01.1913 25.91 100051 ..... 01.1799 17.96 100144 ..... 01.2106 15.29 100246 ..... 01.4064 21.86

060029 ..... 00.8982 11.90 070027 ..... 01.2398 25.65 100052 ..... 01.3791 15.15 100145 ..... 01.3341 19.01 100248 ..... 01.7042 17.76

060030 ..... 01.2955 18.79 070028 ..... 01.5045 24.91 100053 ..... 01.3588 17.17 100146 ..... 01.0803 16.01 100249 ..... 01.3760 19.41

060031 ..... 01.6946 18.97 070029 ..... 01.4122 22.06 100054 ..... 01.3015 17.75 100147 ..... 01.0947 13.18 100252 ..... 01.2387 19.72

060032 ..... 01.5169 17.36 070030 ..... 01.3122 26.51 100055 ..... 01.4205 17.02 100150 ..... 01.4309 19.30 100253 ..... 01.4817 19.73

060033 ..... 01.0987 12.53 070031 ..... 01.2814 22.20 100056 ..... 01.5137 18.89 100151 ..... 01.7824 19.37 100254 ..... 01.6114 17.99

060034 ..... 01.4683 22.34 070033 ..... 01.3695 26.22 100057 ..... 01.3921 16.01 100154 ..... 01.6732 19.96 100255 ..... 01.2325 19.80

060036 ..... 01.0990 14.70 070034 ..... 01.3677 27.52 100060 ..... 01.8118 15.28 100156 ..... 01.1559 19.34 100256 ..... 01.9087 18.78

060037 ..... 01.0476 13.16 070035 ..... 01.4409 23.11 100061 ..... 01.4753 20.71 100157 ..... 01.6173 20.46 100258 ..... 01.6458 21.27

060038 ..... 01.0363 12.96 070036 ..... 01.6080 27.46 100062 ..... 01.7555 17.75 100159 ..... 00.9163 12.79 100259 ..... 01.4904 17.31

060041 ..... 00.9054 14.99 070038 ..... 00.6569 .......... 100063 ..... 01.3311 16.56 100160 ..... 01.2200 18.48 100260 ..... 01.4650 20.13

060042 ..... 01.1304 16.83 070039 ..... 00.9101 .......... 100067 ..... 01.4572 16.77 100161 ..... 01.7317 20.07 100262 ..... 01.4430 18.60

060043 ..... 00.9371 13.31 080001 ..... 01.6742 24.79 100068 ..... 01.3780 16.37 100162 ..... 01.4422 17.78 100263 ..... 01.4125 17.42

060044 ..... 01.2746 16.98 080002 ..... 01.2519 17.15 100069 ..... 01.3870 17.95 100165 ..... 01.1791 17.55 100264 ..... 01.3958 17.27

060046 ..... 01.0985 16.64 080003 ..... 01.3456 20.79 100070 ..... 01.4506 18.13 100166 ..... 01.5356 20.44 100265 ..... 01.3923 14.58
Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations 46057

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100266 ..... 01.3567 16.53 110066 ..... 01.5392 18.78 110163 ..... 01.4700 18.54 130010 ..... 00.9235 15.97 140043 ..... 01.2331 17.04

100267 ..... 01.3515 15.67 110069 ..... 01.2619 19.05 110164 ..... 01.4737 19.49 130011 ..... 01.3075 17.11 140045 ..... 01.0692 13.11

100268 ..... 01.2095 23.23 110070 ..... 01.0212 12.19 110165 ..... 01.3694 18.35 130012 ..... 01.0283 20.53 140046 ..... 01.3163 14.79

100269 ..... 01.4373 19.39 110071 ..... 01.1784 10.43 110166 ..... 01.5345 17.45 130013 ..... 01.2638 17.73 140047 ..... 01.1477 14.21

100270 ..... 00.8362 14.31 110072 ..... 01.0009 12.37 110168 ..... 01.7282 21.92 130014 ..... 01.3868 16.50 140048 ..... 01.4278 22.08

100271 ..... 01.7347 20.00 110073 ..... 01.2226 13.04 110169 ..... 01.1751 21.80 130015 ..... 00.8545 13.50 140049 ..... 01.5605 20.48

100275 ..... 01.4042 21.30 110074 ..... 01.4618 18.47 110171 ..... 01.4770 23.10 130016 ..... 00.9422 17.37 140051 ..... 01.5469 19.42

100276 ..... 01.2982 22.26 110075 ..... 01.3606 15.50 110172 ..... 01.4150 19.98 130017 ..... 01.1854 12.16 140052 ..... 01.3706 18.11

100277 ..... 01.0751 13.03 110076 ..... 01.4355 19.08 110174 ..... 00.9636 13.19 130018 ..... 01.7030 17.05 140053 ..... 01.9782 18.04

100279 ..... 01.3599 18.73 110078 ..... 01.7043 20.66 110176 ..... 01.4585 20.47 130019 ..... 01.1185 14.30 140054 ..... 01.3506 24.77

100280 ..... 01.3734 16.76 110079 ..... 01.4037 19.53 110177 ..... 01.5652 26.92 130021 ..... 01.0006 11.89 140055 ..... 01.0313 12.61

100281 ..... 01.2594 20.52 110080 ..... 01.2684 18.15 110178 ..... 01.4061 17.41 130022 ..... 01.2169 16.88 140058 ..... 01.2470 15.74

100282 ..... 01.1224 14.86 110082 ..... 02.0407 20.53 110179 ..... 01.2257 21.81 130024 ..... 01.1092 16.52 140059 ..... 01.1860 13.96

110001 ..... 01.3100 17.26 110083 ..... 01.7837 20.63 110181 ..... 00.9756 12.32 130025 ..... 01.0874 14.90 140061 ..... 01.0964 14.14

110002 ..... 01.3087 15.75 110086 ..... 01.2402 16.50 110183 ..... 01.4248 19.97 130026 ..... 01.1228 18.80 140062 ..... 01.2675 25.30

110003 ..... 01.3377 12.66 110087 ..... 01.3393 19.53 110184 ..... 01.2670 18.82 130027 ..... 00.9792 17.34 140063 ..... 01.4672 24.56

110004 ..... 01.3711 14.62 110088 ..... 00.9425 12.52 110185 ..... 01.1241 12.44 130028 ..... 01.2707 18.86 140064 ..... 01.3583 17.02

110005 ..... 01.1453 19.77 110089 ..... 01.2363 16.07 110186 ..... 01.3818 16.69 130029 ..... 01.0342 15.77 140065 ..... 01.5866 23.89

110006 ..... 01.3772 17.90 110091 ..... 01.3388 20.17 110187 ..... 01.3395 18.27 130030 ..... 01.0073 17.62 140066 ..... 01.3048 14.92

110007 ..... 01.5469 15.29 110092 ..... 01.1788 12.84 110188 ..... 01.4320 18.16 130031 ..... 01.0779 12.21 140067 ..... 01.7828 18.84

110008 ..... 01.3463 16.25 110093 ..... 00.9510 12.42 110189 ..... 01.1175 18.39 130034 ..... 00.9862 17.80 140068 ..... 01.2205 18.58

110009 ..... 00.9912 13.65 110094 ..... 01.0040 11.90 110190 ..... 01.1014 14.95 130035 ..... 01.0837 19.75 140069 ..... 01.0061 14.69

110010 ..... 02.1198 21.49 110095 ..... 01.3281 14.45 110191 ..... 01.3767 18.34 130036 ..... 01.3041 13.11 140070 ..... 01.2445 16.86

110011 ..... 01.2429 16.73 110096 ..... 01.1410 13.95 110192 ..... 01.4551 18.88 130037 ..... 01.1847 16.09 140074 ..... 00.9695 14.23

110013 ..... 01.1032 14.97 110097 ..... 01.0230 13.43 110193 ..... 01.2501 17.43 130043 ..... 01.0073 15.45 140075 ..... 01.4790 20.98

110014 ..... 01.0237 14.25 110098 ..... 01.0524 12.75 110194 ..... 01.0069 13.81 130044 ..... 01.1645 12.49 140077 ..... 01.1879 16.68

110015 ..... 01.2373 16.42 110100 ..... 01.0948 12.76 110195 ..... 01.0547 11.35 130045 ..... 01.0068 12.07 140079 ..... 01.2407 19.72

110016 ..... 01.3097 14.79 110101 ..... 01.1680 11.58 110198 ..... 01.3714 24.04 130048 ..... 01.0818 13.31 140080 ..... 01.6437 21.22

110017 ..... 00.8642 13.54 110103 ..... 00.9614 10.15 110200 ..... 01.8297 17.05 130049 ..... 01.2812 18.00 140081 ..... 01.0873 13.46

110018 ..... 01.1504 17.79 110104 ..... 01.0884 14.01 110201 ..... 01.5086 17.52 130054 ..... 00.8937 17.61 140082 ..... 01.4347 19.59

110020 ..... 01.3479 16.21 110105 ..... 01.1841 14.60 110203 ..... 00.9967 17.25 130056 ..... 00.8733 11.05 140083 ..... 01.2436 17.22

110023 ..... 01.3398 18.43 110107 ..... 01.8230 18.50 110204 ..... 00.8066 14.34 130058 ..... 00.7670 14.21 140084 ..... 01.2282 18.60

110024 ..... 01.4870 16.41 110108 ..... 00.9444 11.26 110205 ..... 01.1252 17.06 130060 ..... 01.3323 19.41 140086 ..... 01.0865 14.36

110025 ..... 01.4319 17.54 110109 ..... 01.0931 13.63 110207 ..... 01.0857 14.02 130061 ..... 00.9433 .......... 140087 ..... 01.3968 16.15

110026 ..... 01.2107 14.59 110111 ..... 01.0973 16.55 110208 ..... 00.9420 16.97 130062 ..... 00.6589 .......... 140088 ..... 01.6745 24.52

110027 ..... 01.0937 13.41 110112 ..... 01.0839 11.88 110209 ..... 00.7487 16.39 140001 ..... 01.2820 14.89 140089 ..... 01.2535 16.59

110028 ..... 01.6530 19.36 110113 ..... 01.0936 12.40 110211 ..... 00.8898 .......... 140002 ..... 01.3159 18.78 140090 ..... 01.5327 27.83

110029 ..... 01.4107 18.29 110114 ..... 01.0737 14.35 110212 ..... 01.1691 .......... 140003 ..... 01.0178 14.52 140091 ..... 01.8062 17.60

110030 ..... 01.3315 17.58 110115 ..... 01.6022 18.84 110213 ..... 00.5284 .......... 140004 ..... 01.1142 16.34 140093 ..... 01.2077 17.01

110031 ..... 01.3091 19.99 110118 ..... 00.9737 13.49 120001 ..... 01.8272 25.27 140005 ..... 00.9615 09.56 140094 ..... 01.3943 19.46

110032 ..... 01.2694 12.68 110120 ..... 01.0244 12.28 120002 ..... 01.1994 21.80 140007 ..... 01.4823 21.10 140095 ..... 01.4094 20.09

110033 ..... 01.4346 19.79 110121 ..... 01.2007 12.83 120003 ..... 01.0674 22.69 140008 ..... 01.5818 19.43 140097 ..... 00.9670 12.49

110034 ..... 01.6452 17.89 110122 ..... 01.3894 16.17 120004 ..... 01.2661 21.72 140010 ..... 01.3786 22.90 140100 ..... 01.2485 18.78

110035 ..... 01.4345 20.02 110124 ..... 01.0847 15.63 120005 ..... 01.2518 18.94 140011 ..... 01.1969 16.24 140101 ..... 01.2227 18.49

110036 ..... 01.6988 18.37 110125 ..... 01.2361 15.97 120006 ..... 01.3096 24.62 140012 ..... 01.2719 18.60 140102 ..... 01.1121 14.37

110037 ..... 01.1697 11.02 110127 ..... 00.9362 18.26 120007 ..... 01.6811 20.90 140013 ..... 01.5844 15.59 140103 ..... 01.3623 16.25

110038 ..... 01.4667 15.98 110128 ..... 01.1766 19.01 120009 ..... 01.0424 20.40 140014 ..... 01.1687 16.19 140105 ..... 01.3043 20.28

110039 ..... 01.3795 18.62 110129 ..... 01.7851 15.69 120010 ..... 01.8716 22.71 140015 ..... 01.2876 14.20 140107 ..... 01.0708 11.82

110040 ..... 01.1215 15.52 110130 ..... 01.1632 11.11 120011 ..... 01.2451 31.56 140016 ..... 00.9556 11.89 140108 ..... 01.3553 21.81

110041 ..... 01.2723 15.82 110132 ..... 01.1253 12.99 120012 ..... 00.8969 20.20 140018 ..... 01.3988 19.38 140109 ..... 01.1761 13.08

110042 ..... 01.2739 14.92 110134 ..... 00.8917 12.19 120014 ..... 01.4437 22.59 140019 ..... 01.1687 12.65 140110 ..... 01.1910 17.31

110043 ..... 01.7887 16.83 110135 ..... 01.2956 14.04 120015 ..... 00.9237 22.77 140024 ..... 01.0067 13.99 140112 ..... 01.2391 13.42

110044 ..... 01.1492 14.51 110136 ..... 01.1900 17.74 120016 ..... 00.8833 24.58 140025 ..... 01.0608 16.65 140113 ..... 01.5191 17.90

110045 ..... 01.3219 21.18 110140 ..... 01.0284 16.75 120018 ..... 00.9540 20.92 140026 ..... 01.2846 15.90 140114 ..... 01.3524 19.55

110046 ..... 01.3460 17.14 110141 ..... 00.9531 12.29 120019 ..... 01.2500 19.16 140027 ..... 01.3405 16.37 140115 ..... 01.3228 19.66

110048 ..... 01.3732 13.59 110142 ..... 00.9502 11.78 120021 ..... 00.9273 18.74 140029 ..... 01.3589 21.43 140116 ..... 01.3016 20.98

110049 ..... 01.1274 14.58 110143 ..... 01.4557 20.77 120022 ..... 01.7000 20.74 140030 ..... 01.8079 21.56 140117 ..... 01.5393 20.42

110050 ..... 01.2024 13.35 110144 ..... 01.1608 17.41 120026 ..... 01.2756 24.26 140031 ..... 01.2719 13.76 140118 ..... 01.6536 23.74

110051 ..... 01.0340 16.68 110146 ..... 01.1436 15.09 120027 ..... 01.5804 23.43 140032 ..... 01.2657 16.71 140119 ..... 01.7239 23.27

110052 ..... 01.1173 10.83 110149 ..... 01.1587 16.88 120028 ..... 01.0146 .......... 140033 ..... 01.2783 19.82 140120 ..... 01.4592 15.45

110054 ..... 01.3574 16.85 110150 ..... 01.3259 17.62 130001 ..... 01.0126 15.75 140034 ..... 01.1745 17.31 140121 ..... 01.5391 11.54

110056 ..... 01.1733 14.40 110152 ..... 01.1022 14.44 130002 ..... 01.4330 15.30 140035 ..... 00.9305 11.22 140122 ..... 01.6581 21.47

110059 ..... 01.3155 13.38 110153 ..... 01.0153 19.87 130003 ..... 01.3679 19.28 140036 ..... 01.2088 16.60 140124 ..... 01.2722 23.81

110061 ..... 01.0721 12.61 110154 ..... 00.8230 13.98 130005 ..... 01.5281 19.70 140037 ..... 01.1042 12.49 140125 ..... 01.3597 15.71

110062 ..... 00.8945 10.97 110155 ..... 01.0562 13.62 130006 ..... 01.8420 17.59 140038 ..... 01.1785 16.23 140127 ..... 01.3922 17.32

110063 ..... 01.1481 12.76 110156 ..... 01.0376 12.34 130007 ..... 01.6306 18.20 140040 ..... 01.2942 14.72 140128 ..... 01.1103 14.92

110064 ..... 01.3339 17.46 110161 ..... 01.3272 21.00 130008 ..... 01.0035 11.00 140041 ..... 01.3305 16.02 140129 ..... 01.2226 14.94

110065 ..... 01.0391 13.40 110162 ..... 00.8006 .......... 130009 ..... 00.9620 10.74 140042 ..... 01.0137 14.16 140130 ..... 01.3646 21.74
46058 Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations

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140132 ..... 01.4451 19.03 140230 ..... 00.9258 10.84 150043 ..... 01.0838 21.96 150127 ..... 01.0241 13.90 160073 ..... 00.9761 12.18

140133 ..... 01.3392 21.21 140231 ..... 01.5927 20.80 150044 ..... 01.2610 18.32 150128 ..... 01.2162 19.14 160074 ..... 01.0986 14.36

140135 ..... 01.3065 14.91 140233 ..... 01.7888 18.47 150045 ..... 01.0998 15.68 150129 ..... 01.2317 22.47 160075 ..... 01.1442 13.73

140137 ..... 01.0630 14.58 140234 ..... 01.2898 16.47 150046 ..... 01.5284 15.90 150130 ..... 01.3599 16.61 160076 ..... 01.0731 15.50

140138 ..... 00.9835 12.15 140236 ..... 00.9644 13.24 150047 ..... 01.5639 22.77 150132 ..... 01.4214 19.24 160077 ..... 01.1723 10.60

140139 ..... 01.1361 14.70 140239 ..... 01.6836 18.73 150048 ..... 01.2057 16.52 150133 ..... 01.2178 14.12 160079 ..... 01.4096 16.28

140140 ..... 01.1398 13.06 140240 ..... 01.4851 20.44 150049 ..... 01.1663 13.29 150134 ..... 01.1751 17.17 160080 ..... 01.2022 16.06

140141 ..... 01.2514 13.76 140242 ..... 01.6293 21.68 150050 ..... 01.2047 14.73 150136 ..... 01.0683 18.42 160081 ..... 01.0670 14.77

140143 ..... 01.1478 16.64 140245 ..... 01.1694 14.47 150051 ..... 01.4788 18.34 150138 ..... 01.2073 17.33 160082 ..... 01.8242 17.03

140144 ..... 01.0291 17.83 140246 ..... 01.0832 12.05 150052 ..... 01.1504 14.14 150139 ..... 01.4731 14.62 160083 ..... 01.6850 18.37

140145 ..... 01.1791 15.14 140250 ..... 01.3797 21.98 150053 ..... 01.0508 18.10 160001 ..... 01.2891 17.61 160085 ..... 01.0802 11.50

140146 ..... 01.0442 16.38 140251 ..... 01.3829 19.16 150054 ..... 01.1554 12.55 160002 ..... 01.1697 13.74 160086 ..... 00.9984 13.93

140147 ..... 01.2801 16.29 140252 ..... 01.4473 23.41 150056 ..... 01.7839 22.38 160003 ..... 01.0195 12.61 160088 ..... 01.1633 12.75

140148 ..... 01.8518 17.11 140253 ..... 01.4156 17.49 150057 ..... 02.3206 18.94 160005 ..... 01.1311 13.80 160089 ..... 01.1873 14.80

140150 ..... 01.6279 25.55 140258 ..... 01.5772 20.93 150058 ..... 01.7195 19.57 160007 ..... 01.0323 12.37 160090 ..... 00.9797 15.58

140151 ..... 01.1103 16.64 140271 ..... 01.0850 13.01 150059 ..... 01.4121 19.81 160008 ..... 01.1305 14.02 160091 ..... 01.0810 10.80

140152 ..... 01.1184 22.91 140275 ..... 01.2390 16.50 150060 ..... 01.1657 14.93 160009 ..... 01.2378 13.73 160092 ..... 01.0879 13.23

140155 ..... 01.2969 16.96 140276 ..... 01.9603 21.37 150061 ..... 01.2378 15.73 160012 ..... 01.0294 13.15 160093 ..... 01.2058 13.86

140158 ..... 01.3077 21.36 140280 ..... 01.3142 17.16 150062 ..... 01.0996 16.55 160013 ..... 01.2266 15.35 160094 ..... 01.1302 14.17

140160 ..... 01.2232 15.93 140281 ..... 01.6474 20.89 150063 ..... 01.0938 17.57 160014 ..... 01.0125 12.59 160095 ..... 01.0915 12.79

140161 ..... 01.2168 17.76 140285 ..... 01.2802 15.37 150064 ..... 01.2141 15.84 160016 ..... 01.2505 16.32 160097 ..... 01.1409 13.00

140162 ..... 01.7542 17.96 140286 ..... 01.1253 17.93 150065 ..... 01.1631 18.49 160018 ..... 00.9298 13.27 160098 ..... 00.9679 14.81

140164 ..... 01.3924 17.44 140288 ..... 01.8518 23.17 150066 ..... 00.9993 15.93 160020 ..... 01.0718 12.38 160099 ..... 00.9671 11.69

140165 ..... 01.1383 12.90 140289 ..... 01.3190 15.79 150067 ..... 01.1295 15.48 160021 ..... 01.0703 13.57 160101 ..... 01.1730 18.64

140166 ..... 01.3636 17.21 140290 ..... 01.4617 21.07 150069 ..... 01.2618 16.90 160023 ..... 01.0386 12.35 160102 ..... 01.3886 17.51

140167 ..... 01.1286 14.97 140291 ..... 01.4126 22.95 150070 ..... 01.0279 14.83 160024 ..... 01.5221 18.06 160103 ..... 01.0399 13.57

140168 ..... 01.1895 15.57 140292 ..... 01.1602 20.63 150071 ..... 01.1162 13.86 160026 ..... 01.0593 14.43 160104 ..... 01.3168 17.37

140170 ..... 01.1141 12.53 140294 ..... 01.1859 16.20 150072 ..... 01.2089 15.48 160027 ..... 01.1570 13.19 160106 ..... 01.0620 14.03

140171 ..... 00.9150 13.87 140297 ..... 01.5673 27.06 150073 ..... 01.0134 19.47 160028 ..... 01.3255 17.39 160107 ..... 01.1797 14.12

140172 ..... 01.6091 18.71 140300 ..... 01.4471 18.71 150074 ..... 01.5964 18.80 160029 ..... 01.5134 18.14 160108 ..... 01.2018 14.95

140173 ..... 00.9277 13.77 150001 ..... 01.1125 17.36 150075 ..... 01.1711 14.49 160030 ..... 01.3852 17.37 160109 ..... 01.0406 12.35

140174 ..... 01.5683 18.33 150002 ..... 01.5434 18.35 150076 ..... 01.2164 20.39 160031 ..... 01.1197 13.37 160110 ..... 01.5234 17.97

140176 ..... 01.3064 21.33 150003 ..... 01.7180 19.57 150077 ..... 01.1796 16.58 160032 ..... 01.0998 15.56 160111 ..... 01.0272 11.04

140177 ..... 01.1644 16.52 150004 ..... 01.4342 19.97 150078 ..... 01.0840 15.66 160033 ..... 01.7885 16.80 160112 ..... 01.4213 15.00

140179 ..... 01.3195 20.12 150005 ..... 01.1913 18.43 150079 ..... 01.1368 13.96 160034 ..... 01.2092 14.53 160113 ..... 01.0022 12.03

140180 ..... 01.5086 21.03 150006 ..... 01.2242 17.31 150082 ..... 01.5181 17.44 160035 ..... 01.0318 12.57 160114 ..... 01.0662 14.21

140181 ..... 01.3825 19.20 150007 ..... 01.2036 17.98 150084 ..... 01.8769 22.28 160036 ..... 00.9707 14.66 160115 ..... 01.0262 14.32

140182 ..... 01.3711 20.67 150008 ..... 01.3534 20.70 150086 ..... 01.3365 16.45 160037 ..... 01.1614 15.14 160116 ..... 01.1790 15.68

140184 ..... 01.2542 14.26 150009 ..... 01.3747 17.26 150088 ..... 01.3466 17.20 160039 ..... 01.0809 15.84 160117 ..... 01.4518 15.96

140185 ..... 01.4152 16.78 150010 ..... 01.1825 15.87 150089 ..... 01.4284 18.43 160040 ..... 01.3187 16.30 160118 ..... 01.0205 13.15

140186 ..... 01.3530 17.75 150011 ..... 01.2266 17.83 150090 ..... 01.2517 18.72 160041 ..... 01.0854 13.45 160120 ..... 01.0296 10.62

140187 ..... 01.4893 16.54 150012 ..... 01.6946 21.01 150091 ..... 01.1381 15.75 160043 ..... 01.0374 13.44 160122 ..... 01.1314 16.24

140188 ..... 01.0402 10.77 150013 ..... 01.1254 13.90 150092 ..... 01.0304 15.04 160044 ..... 01.3190 13.86 160123 ..... 01.0588 13.19

140189 ..... 01.1952 16.64 150014 ..... 01.5059 20.39 150094 ..... 01.0148 16.85 160045 ..... 01.7651 17.72 160124 ..... 01.2799 15.87

140190 ..... 01.1402 15.99 150015 ..... 01.2169 18.32 150095 ..... 01.1048 17.97 160046 ..... 01.0014 12.75 160126 ..... 01.0198 13.59

140191 ..... 01.4511 21.87 150017 ..... 01.8651 17.20 150096 ..... 01.1653 17.34 160047 ..... 01.3677 15.37 160129 ..... 01.0290 13.75

140193 ..... 01.0432 13.31 150018 ..... 01.2899 18.23 150097 ..... 01.1381 17.09 160048 ..... 01.0373 11.54 160130 ..... 01.1777 13.02

140197 ..... 01.2610 16.96 150019 ..... 01.1022 15.47 150098 ..... 01.1494 13.03 160049 ..... 00.9485 12.21 160131 ..... 01.0519 13.55

140199 ..... 01.1014 15.72 150020 ..... 01.1488 12.96 150099 ..... 01.2905 17.79 160050 ..... 01.0755 14.64 160134 ..... 01.0482 11.84

140200 ..... 01.4765 21.79 150021 ..... 01.6386 18.34 150100 ..... 01.7163 17.65 160051 ..... 00.9646 13.54 160135 ..... 01.0968 13.67

140202 ..... 01.3540 19.71 150022 ..... 01.0910 16.65 150101 ..... 01.1111 14.50 160052 ..... 01.0875 14.79 160138 ..... 01.1290 14.36

140203 ..... 01.1609 19.32 150023 ..... 01.5116 18.19 150102 ..... 01.0431 14.93 160054 ..... 01.0755 12.37 160140 ..... 01.1716 14.76

140205 ..... 00.8789 13.64 150024 ..... 01.4348 15.82 150103 ..... 01.0075 15.02 160055 ..... 00.9798 12.37 160142 ..... 01.0866 13.98

140206 ..... 01.1121 20.81 150025 ..... 01.3892 17.57 150104 ..... 01.0990 15.63 160056 ..... 01.0863 13.11 160143 ..... 01.0270 14.24

140207 ..... 01.3959 20.01 150026 ..... 01.1868 18.29 150105 ..... 01.3508 16.20 160057 ..... 01.3465 16.15 160145 ..... 01.1210 14.16

140208 ..... 01.6948 24.07 150027 ..... 01.0461 15.55 150106 ..... 01.0805 16.06 160058 ..... 01.7461 19.00 160146 ..... 01.4322 14.59

140209 ..... 01.6697 15.99 150029 ..... 01.3137 20.17 150109 ..... 01.4613 16.85 160060 ..... 01.0442 13.44 160147 ..... 01.3056 16.09

140210 ..... 01.1194 14.00 150030 ..... 01.2098 16.69 150110 ..... 01.0000 17.16 160061 ..... 01.0428 14.27 160151 ..... 01.0503 13.74

140211 ..... 01.1916 20.84 150031 ..... 01.0741 15.56 150111 ..... 01.1642 14.02 160062 ..... 00.9492 12.22 160152 ..... 00.9935 13.78

140212 ..... 01.2953 22.47 150032 ..... 01.8880 19.50 150112 ..... 01.3074 17.80 160063 ..... 01.1653 15.88 160153 ..... 01.7437 17.53

140213 ..... 01.2782 22.67 150033 ..... 01.6073 21.09 150113 ..... 01.2230 17.88 160064 ..... 01.7113 17.38 170001 ..... 01.1849 16.35

140215 ..... 01.1308 13.49 150034 ..... 01.3884 21.18 150114 ..... 01.0122 14.58 160065 ..... 01.0284 14.73 170004 ..... 01.0730 13.57

140217 ..... 01.3185 21.67 150035 ..... 01.5318 18.97 150115 ..... 01.3808 17.55 160066 ..... 01.1723 14.74 170006 ..... 01.1492 15.02

140218 ..... 00.9966 13.65 150036 ..... 01.0412 17.43 150122 ..... 01.1253 17.11 160067 ..... 01.4125 17.13 170008 ..... 01.0265 14.53

140220 ..... 01.0925 15.16 150037 ..... 01.2684 18.20 150123 ..... 01.2043 12.98 160068 ..... 01.0660 13.52 170009 ..... 01.1988 16.31

140223 ..... 01.6457 28.66 150038 ..... 01.4044 17.22 150124 ..... 01.1085 15.97 160069 ..... 01.4620 16.42 170010 ..... 01.2496 15.77

140224 ..... 01.3885 22.97 150039 ..... 00.9657 16.33 150125 ..... 01.3906 18.69 160070 ..... 01.0507 14.47 170011 ..... 01.2378 15.40

140228 ..... 01.6939 18.22 150042 ..... 01.2975 16.00 150126 ..... 01.5082 20.17 160072 ..... 01.0756 11.60 170012 ..... 01.4732 16.08
Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations 46059

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170013 ..... 01.3228 15.33 170098 ..... 01.0500 17.00 180023 ..... 00.8812 13.12 180122 ..... 01.0903 15.01 190088 ..... 01.3480 ..........

170014 ..... 01.0365 16.40 170099 ..... 01.2666 11.34 180024 ..... 01.3911 17.24 180123 ..... 01.4774 20.98 190089 ..... 01.0784 11.47

170015 ..... 01.0652 14.36 170100 ..... 00.9917 14.47 180025 ..... 01.2141 17.17 180124 ..... 01.4878 16.52 190090 ..... 01.1650 16.84

170016 ..... 01.6876 19.52 170101 ..... 00.9485 13.26 180026 ..... 01.2402 12.39 180125 ..... 00.9976 16.46 190092 ..... 01.3982 ..........

170017 ..... 01.2527 15.34 170102 ..... 00.9926 13.11 180027 ..... 01.2873 15.58 180126 ..... 01.2371 12.22 190095 ..... 01.0677 14.66

170018 ..... 01.1576 13.13 170103 ..... 01.2089 15.62 180028 ..... 00.9959 16.39 180127 ..... 01.4053 17.22 190098 ..... 01.5464 18.86

170019 ..... 01.2248 15.65 170104 ..... 01.4508 19.81 180029 ..... 01.2772 15.97 180128 ..... 01.1761 16.64 190099 ..... 01.1522 17.98

170020 ..... 01.2898 14.98 170105 ..... 01.0962 15.91 180030 ..... 01.2383 13.31 180129 ..... 01.0116 14.45 190102 ..... 01.5617 17.77

170022 ..... 01.1756 14.80 170106 ..... 00.8948 12.18 180031 ..... 01.2070 12.60 180130 ..... 01.4718 17.91 190103 ..... 00.8823 09.75

170023 ..... 01.4656 16.42 170109 ..... 01.0364 14.50 180032 ..... 00.9250 15.83 180132 ..... 01.2950 15.20 190106 ..... 01.1721 17.69

170024 ..... 01.1515 12.84 170110 ..... 00.9577 13.67 180033 ..... 01.1365 12.86 180133 ..... 01.3505 24.67 190109 ..... 01.2153 13.50

170025 ..... 01.2269 15.81 170112 ..... 00.9853 13.90 180034 ..... 01.2655 14.14 180134 ..... 01.0389 13.87 190110 ..... 00.9437 12.43

170026 ..... 01.0417 12.83 170113 ..... 01.1475 14.95 180035 ..... 01.5526 18.73 180136 ..... 01.6029 16.47 190111 ..... 01.5997 18.33

170027 ..... 01.3447 15.50 170114 ..... 01.0128 13.80 180036 ..... 01.2050 17.11 180137 ..... 01.8119 18.38 190112 ..... 01.5901 19.46

170030 ..... 01.0153 13.99 170115 ..... 01.0238 11.34 180037 ..... 01.3414 19.79 180138 ..... 01.2091 17.99 190113 ..... 01.3584 18.49

170031 ..... 00.9092 12.62 170116 ..... 01.0473 15.74 180038 ..... 01.4104 15.04 180139 ..... 01.1543 18.64 190114 ..... 01.0182 12.20

170032 ..... 01.1647 14.89 170117 ..... 00.9415 13.50 180040 ..... 02.0226 19.20 180140 ..... 00.8743 .......... 190115 ..... 01.2236 18.33

170033 ..... 01.3701 14.59 170119 ..... 00.9812 12.09 180041 ..... 01.1036 13.42 180141 ..... 01.8022 .......... 190116 ..... 01.1871 ..........

170034 ..... 00.9962 14.61 170120 ..... 01.2988 16.06 180042 ..... 01.1987 13.59 190001 ..... 00.8702 17.98 190118 ..... 01.0964 12.38

170035 ..... 00.8580 14.82 170122 ..... 01.7447 19.93 180043 ..... 01.0028 15.84 190002 ..... 01.6861 18.15 190120 ..... 01.0003 13.75

170036 ..... 00.9007 13.19 170123 ..... 01.7667 19.02 180044 ..... 01.1644 16.29 190003 ..... 01.3867 17.41 190122 ..... 01.2265 15.70

170037 ..... 01.2485 16.31 170124 ..... 01.0109 14.25 180045 ..... 01.2627 16.79 190004 ..... 01.4153 15.24 190124 ..... 01.6508 20.23

170038 ..... 00.9237 11.46 170126 ..... 00.9445 11.50 180046 ..... 01.2348 16.65 190005 ..... 01.6473 17.60 190125 ..... 01.5592 17.99

170039 ..... 01.1505 13.62 170128 ..... 00.9794 14.42 180047 ..... 01.0286 13.80 190006 ..... 01.2974 14.32 190128 ..... 01.0852 18.56

170040 ..... 01.6026 18.83 170131 ..... 01.2140 09.38 180048 ..... 01.2851 16.17 190007 ..... 01.0081 13.52 190130 ..... 01.0318 12.09

170041 ..... 00.9985 11.29 170133 ..... 01.1285 14.20 180049 ..... 01.3320 15.45 190008 ..... 01.6674 17.72 190131 ..... 01.2019 16.12

170043 ..... 01.0095 13.49 170134 ..... 00.9462 12.48 180050 ..... 01.2528 16.12 190009 ..... 01.1614 13.79 190133 ..... 00.9749 12.08

170044 ..... 01.1045 14.42 170137 ..... 01.1888 17.30 180051 ..... 01.4299 14.78 190010 ..... 01.0337 16.62 190134 ..... 01.0188 14.79

170045 ..... 01.0555 10.72 170139 ..... 01.0392 11.82 180053 ..... 01.0895 14.30 190011 ..... 01.1664 14.41 190135 ..... 01.4616 22.58

170049 ..... 01.2898 18.28 170142 ..... 01.3501 16.49 180054 ..... 01.1107 13.76 190013 ..... 01.3986 15.95 190136 ..... 01.2005 11.22

170051 ..... 00.9202 13.66 170143 ..... 01.1128 13.82 180055 ..... 01.1648 14.00 190014 ..... 01.1133 15.35 190138 ..... 00.8846 17.51

170052 ..... 01.0589 12.60 170144 ..... 01.6127 14.73 180056 ..... 01.0761 16.38 190015 ..... 01.2521 17.78 190140 ..... 01.0146 12.16

170053 ..... 00.9478 15.39 170145 ..... 01.1395 14.83 180058 ..... 00.9870 12.63 190017 ..... 01.4478 16.02 190142 ..... 00.9041 12.39

170054 ..... 01.0865 13.19 170146 ..... 01.5244 19.54 180059 ..... 00.9160 12.59 190018 ..... 01.1910 15.92 190144 ..... 01.3101 15.22

170055 ..... 01.0974 14.55 170147 ..... 01.2724 20.70 180060 ..... 01.0317 10.17 190019 ..... 01.6081 18.39 190145 ..... 00.9987 13.66

170056 ..... 00.9193 13.72 170148 ..... 01.4120 17.64 180063 ..... 00.9916 10.79 190020 ..... 01.1829 15.85 190146 ..... 01.6349 19.61

170057 ..... 01.0283 13.90 170150 ..... 01.0938 13.41 180064 ..... 01.3317 14.03 190025 ..... 01.3560 13.62 190147 ..... 01.0237 13.69

170058 ..... 01.1682 15.80 170151 ..... 01.0380 11.66 180065 ..... 01.0472 10.82 190026 ..... 01.4931 16.17 190148 ..... 00.9081 12.77

170060 ..... 01.0543 13.41 170152 ..... 00.9840 12.99 180066 ..... 01.1561 18.09 190027 ..... 01.5790 16.49 190149 ..... 01.0591 11.47

170061 ..... 01.1320 12.90 170160 ..... 00.9790 11.17 180067 ..... 01.8053 16.40 190029 ..... 01.1538 15.40 190151 ..... 01.2260 11.73

170063 ..... 00.8933 10.92 170164 ..... 00.9859 14.42 180069 ..... 01.0138 15.33 190033 ..... 00.9378 09.66 190152 ..... 01.5161 21.27

170064 ..... 01.0420 12.09 170166 ..... 01.2016 13.65 180070 ..... 01.1195 14.66 190034 ..... 01.2429 .......... 190155 ..... 01.0392 12.29

170066 ..... 00.9793 12.58 170168 ..... 00.9222 09.33 180072 ..... 01.0649 13.91 190035 ..... 01.3660 .......... 190156 ..... 00.8732 11.99

170067 ..... 01.1302 11.76 170171 ..... 01.0731 11.22 180075 ..... 01.0012 14.13 190036 ..... 01.6990 19.10 190158 ..... 01.1877 21.59

170068 ..... 01.3080 15.24 170175 ..... 01.3540 17.53 180078 ..... 01.1591 17.57 190037 ..... 00.8934 10.84 190160 ..... 01.3255 17.03

170069 ..... 00.8338 14.01 170176 ..... 01.6200 19.83 180079 ..... 01.3352 13.03 190039 ..... 01.4034 17.21 190161 ..... 01.1212 12.65

170070 ..... 01.0108 12.56 170182 ..... 01.2299 19.43 180080 ..... 01.0543 15.57 190040 ..... 01.4397 19.32 190162 ..... 01.0388 18.47

170073 ..... 01.0663 14.67 170183 ..... 02.0361 .......... 180085 ..... 02.2480 17.70 190041 ..... 01.5692 19.72 190164 ..... 01.2269 16.05

170074 ..... 01.2456 14.34 170184 ..... 01.1905 .......... 180087 ..... 01.1722 13.74 190043 ..... 01.0383 11.79 190166 ..... 00.9327 14.04

170075 ..... 00.9439 10.67 180001 ..... 01.2323 17.03 180088 ..... 01.5598 19.99 190044 ..... 01.1678 17.11 190167 ..... 01.2338 18.49

170076 ..... 01.0546 11.60 180002 ..... 01.0634 16.78 180092 ..... 01.2627 15.25 190045 ..... 01.4070 20.17 190170 ..... 00.9454 13.08

170077 ..... 00.9418 12.07 180004 ..... 01.1027 14.47 180093 ..... 01.3756 16.05 190046 ..... 01.4636 17.58 190173 ..... 01.4730 20.12

170079 ..... 01.0260 12.66 180005 ..... 01.1767 18.54 180094 ..... 01.0358 11.51 190048 ..... 01.2833 13.72 190175 ..... 01.3200 20.26

170080 ..... 00.9806 10.65 180006 ..... 00.9857 08.51 180095 ..... 01.2459 12.94 190049 ..... 00.9962 15.70 190176 ..... 01.7427 19.11

170081 ..... 01.0204 10.44 180007 ..... 01.5365 16.29 180099 ..... 01.3192 12.31 190050 ..... 01.0311 14.58 190177 ..... 01.6579 22.84

170082 ..... 01.0284 10.80 180009 ..... 01.4058 19.11 180101 ..... 01.3237 18.01 190053 ..... 01.0753 12.11 190178 ..... 00.9581 10.87

170084 ..... 00.9539 10.93 180010 ..... 01.8565 18.19 180102 ..... 01.4761 16.43 190054 ..... 01.3375 14.09 190182 ..... 00.9681 20.02

170085 ..... 00.9648 12.69 180011 ..... 01.2791 15.29 180103 ..... 02.1571 17.93 190059 ..... 00.9187 13.44 190183 ..... 01.1238 14.79

170086 ..... 01.7259 18.50 180012 ..... 01.4064 17.51 180104 ..... 01.5751 18.07 190060 ..... 01.4553 15.43 190184 ..... 01.0796 13.09

170087 ..... 16.1090 18.78 180013 ..... 01.4569 16.63 180105 ..... 01.0042 12.82 190064 ..... 01.6010 18.33 190185 ..... 01.3600 18.53

170088 ..... 00.9759 10.80 180014 ..... 01.7118 19.99 180106 ..... 00.8943 12.27 190065 ..... 01.4987 14.71 190186 ..... 00.9457 13.16

170089 ..... 00.9506 15.53 180015 ..... 01.3127 15.02 180108 ..... 00.8561 13.54 190071 ..... 00.8980 12.15 190189 ..... 01.0752 13.17

170090 ..... 01.0397 09.80 180016 ..... 01.3243 14.50 180115 ..... 01.0271 15.07 190077 ..... 00.9526 13.65 190190 ..... 00.9250 12.66

170092 ..... 00.8270 11.80 180017 ..... 01.3423 13.87 180116 ..... 01.4484 15.66 190078 ..... 01.1690 11.60 190191 ..... 01.3301 17.54

170093 ..... 00.9986 11.76 180018 ..... 01.2533 14.59 180117 ..... 01.1145 17.03 190079 ..... 01.2555 16.98 190196 ..... 00.8663 16.29

170094 ..... 00.9536 15.42 180019 ..... 01.3260 16.70 180118 ..... 01.0362 12.03 190081 ..... 00.9078 10.23 190197 ..... 01.2380 18.98

170095 ..... 01.1349 13.69 180020 ..... 01.0728 15.86 180120 ..... 01.0568 13.12 190083 ..... 01.0600 15.02 190199 ..... 01.1999 16.26

170097 ..... 01.0695 13.17 180021 ..... 01.1131 13.69 180121 ..... 01.2249 13.68 190086 ..... 01.4128 15.47 190200 ..... 01.5575 21.70
46060 Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations

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190201 ..... 01.2734 18.93 210015 ..... 01.2807 18.58 220051 ..... 01.2093 20.56 230019 ..... 01.5032 22.60 230118 ..... 01.2187 16.37

190202 ..... 01.4760 17.85 210016 ..... 01.7192 23.30 220052 ..... 01.3214 23.88 230020 ..... 01.7231 22.21 230119 ..... 01.3042 22.31

190203 ..... 01.5075 20.83 210017 ..... 01.2275 14.51 220053 ..... 01.2594 19.48 230021 ..... 01.6150 17.90 230120 ..... 01.1809 17.47

190204 ..... 01.5863 20.85 210018 ..... 01.2493 21.26 220055 ..... 01.3462 23.52 230022 ..... 01.3615 18.27 230121 ..... 01.2510 19.69

190205 ..... 01.9236 17.90 210019 ..... 01.4990 18.17 220057 ..... 01.4076 21.39 230024 ..... 01.4369 23.71 230122 ..... 01.4028 19.20

190206 ..... 01.5515 21.53 210022 ..... 01.4499 20.79 220058 ..... 01.0836 16.26 230027 ..... 01.1510 15.73 230124 ..... 01.1633 16.89

190207 ..... 01.2969 16.42 210023 ..... 01.3678 20.78 220060 ..... 01.3041 25.32 230029 ..... 01.5797 20.36 230125 ..... 01.2952 14.51

190208 ..... 00.8122 11.17 210024 ..... 01.5604 19.73 220062 ..... 00.5838 18.49 230030 ..... 01.2204 16.47 230128 ..... 01.3852 21.24

190218 ..... 01.1988 15.33 210025 ..... 01.4143 18.21 220063 ..... 01.2285 19.40 230031 ..... 01.4361 19.72 230129 ..... 01.7824 19.92

190223 ..... 00.4249 16.58 210026 ..... 01.3749 19.52 220064 ..... 01.2338 20.51 230032 ..... 01.7412 19.08 230130 ..... 01.6730 23.74

190227 ..... 00.8255 10.56 210027 ..... 01.3029 18.58 220065 ..... 01.2265 19.58 230034 ..... 01.2288 17.99 230132 ..... 01.4154 23.25

190231 ..... 01.3079 16.00 210028 ..... 01.2217 17.19 220066 ..... 01.3350 20.73 230035 ..... 01.1178 16.17 230133 ..... 01.2207 15.07

190233 ..... 02.1157 .......... 210029 ..... 01.3174 17.99 220067 ..... 01.2868 22.58 230036 ..... 01.2775 18.79 230134 ..... 01.1074 17.91

190234 ..... 01.0506 .......... 210030 ..... 01.1539 19.44 220068 ..... 00.5263 16.67 230037 ..... 01.1284 17.40 230135 ..... 01.2642 20.25

190235 ..... 01.2869 .......... 210031 ..... 01.5487 16.42 220070 ..... 01.2498 18.77 230038 ..... 01.7083 21.21 230137 ..... 01.1949 18.51

190236 ..... 01.2668 .......... 210032 ..... 01.1789 17.90 220071 ..... 01.9236 21.67 230040 ..... 01.2243 20.53 230141 ..... 01.6822 22.44

200001 ..... 01.3804 16.92 210033 ..... 01.2620 18.58 220073 ..... 01.4101 24.14 230041 ..... 01.2174 20.75 230142 ..... 01.2188 18.90

200002 ..... 01.0723 17.70 210034 ..... 01.3689 20.34 220074 ..... 01.1894 22.82 230042 ..... 01.2231 19.32 230143 ..... 01.3145 16.58

200003 ..... 01.0974 16.02 210035 ..... 01.2687 18.11 220075 ..... 01.2619 19.51 230046 ..... 01.8844 25.32 230144 ..... 01.2250 21.19

200006 ..... 01.0590 14.97 210037 ..... 01.2433 17.38 220076 ..... 01.1859 25.46 230047 ..... 01.3420 20.37 230145 ..... 01.1856 15.96

200007 ..... 01.1251 17.01 210038 ..... 01.3320 21.63 220077 ..... 01.7917 22.92 230053 ..... 01.6445 24.16 230146 ..... 01.3105 19.56

200008 ..... 01.2258 20.19 210039 ..... 01.1897 17.55 220079 ..... 01.1692 21.68 230054 ..... 01.8208 21.45 230147 ..... 01.4445 19.70

200009 ..... 01.8129 19.95 210040 ..... 01.3323 21.01 220080 ..... 01.2719 19.58 230055 ..... 01.1628 18.26 230149 ..... 01.1767 15.51

200012 ..... 01.1117 16.55 210043 ..... 01.3063 21.32 220081 ..... 01.0044 24.81 230056 ..... 00.9866 14.55 230151 ..... 01.3931 22.02

200013 ..... 01.1261 15.69 210044 ..... 01.2665 19.38 220082 ..... 01.3096 23.04 230058 ..... 01.1539 18.69 230153 ..... 01.1329 19.70

200015 ..... 01.2305 17.41 210045 ..... 01.0746 11.42 220083 ..... 01.1972 20.43 230059 ..... 01.4456 19.01 230154 ..... 00.9371 12.43

200016 ..... 01.0109 15.76 210048 ..... 01.2050 23.30 220084 ..... 01.3134 23.23 230060 ..... 01.3047 17.97 230155 ..... 00.9383 16.62

200017 ..... 01.2501 17.94 210049 ..... 01.1551 17.77 220086 ..... 01.6491 26.01 230062 ..... 01.0249 14.41 230156 ..... 01.7141 22.91

200018 ..... 01.1961 15.20 210051 ..... 01.4237 20.03 220088 ..... 01.6090 22.68 230063 ..... 01.3178 19.15 230157 ..... 01.2020 20.15

200019 ..... 01.2392 18.59 210054 ..... 01.3311 21.05 220089 ..... 01.3337 22.69 230065 ..... 01.3391 19.44 230159 ..... 01.5106 19.64

200020 ..... 01.1405 20.96 210055 ..... 01.2655 24.26 220090 ..... 01.2575 20.95 230066 ..... 01.3879 20.58 230162 ..... 01.0467 15.60

200021 ..... 01.1723 17.78 210056 ..... 01.3809 17.67 220092 ..... 01.2336 20.66 230068 ..... 01.4483 22.15 230165 ..... 01.8519 21.91

200023 ..... 00.9047 16.15 210057 ..... 01.4140 25.76 220094 ..... 01.4156 19.82 230069 ..... 01.1621 21.95 230167 ..... 01.7996 19.23

200024 ..... 01.3279 19.84 210058 ..... 01.5351 18.09 220095 ..... 01.2483 19.06 230070 ..... 01.5713 19.57 230169 ..... 01.3465 20.88

200025 ..... 01.0790 19.51 210059 ..... 01.2620 21.44 220098 ..... 01.2576 19.71 230071 ..... 01.1340 22.00 230171 ..... 01.0260 14.42

200026 ..... 01.0265 15.97 210060 ..... 01.1836 23.61 220100 ..... 01.2637 23.69 230072 ..... 01.2305 19.32 230172 ..... 01.2797 18.87

200027 ..... 01.1183 17.27 210061 ..... 01.1780 17.65 220101 ..... 01.4392 23.41 230075 ..... 01.4720 19.41 230174 ..... 01.2978 19.50

200028 ..... 00.9729 16.24 220001 ..... 01.2880 21.80 220104 ..... 01.3000 24.79 230076 ..... 01.3501 22.67 230175 ..... 03.1496 11.15

200031 ..... 01.2812 15.26 220002 ..... 01.5420 23.02 220105 ..... 01.2698 22.16 230077 ..... 02.0635 18.62 230176 ..... 01.2352 20.69

200032 ..... 01.3456 18.90 220003 ..... 01.0746 16.71 220106 ..... 01.2620 22.14 230078 ..... 01.1336 15.79 230178 ..... 01.0050 17.92

200033 ..... 01.7912 20.16 220004 ..... 01.1627 18.66 220107 ..... 01.1929 19.21 230080 ..... 01.2285 20.74 230180 ..... 01.1057 15.79

200034 ..... 01.2381 18.05 220006 ..... 01.4307 21.04 220108 ..... 01.1992 21.13 230081 ..... 01.2949 16.73 230184 ..... 01.1534 17.45

200037 ..... 01.1963 16.09 220008 ..... 01.2955 20.45 220110 ..... 02.0108 31.74 230082 ..... 01.2055 15.97 230186 ..... 01.2243 17.37

200038 ..... 01.1101 18.23 220010 ..... 01.3125 21.44 220111 ..... 01.2703 21.76 230085 ..... 01.1164 17.76 230188 ..... 01.1813 16.01

200039 ..... 01.2718 19.03 220011 ..... 01.1494 27.00 220116 ..... 02.0069 24.40 230086 ..... 01.0061 14.88 230189 ..... 00.9246 14.93

200040 ..... 01.1080 17.37 220012 ..... 01.3759 30.46 220118 ..... 02.0709 27.44 230087 ..... 01.0463 17.12 230190 ..... 01.0342 20.21

200041 ..... 01.0933 16.19 220015 ..... 01.2323 20.94 220119 ..... 01.3231 24.27 230089 ..... 01.2842 21.86 230191 ..... 00.9118 16.65

200043 ..... 00.5276 16.46 220016 ..... 01.3819 20.87 220123 ..... 01.0394 22.86 230092 ..... 01.3128 18.29 230193 ..... 01.2127 16.97

200050 ..... 01.1870 17.84 220017 ..... 01.3926 23.16 220126 ..... 01.3385 20.63 230093 ..... 01.2211 18.91 230194 ..... 01.1254 15.94

200051 ..... 00.9682 18.29 220019 ..... 01.1521 17.57 220128 ..... 01.2038 22.97 230095 ..... 01.1969 16.51 230195 ..... 01.3147 21.44

200052 ..... 00.9788 14.12 220020 ..... 01.2411 18.68 220133 ..... 00.8368 29.15 230096 ..... 01.1728 20.60 230197 ..... 01.3474 21.41

200055 ..... 01.1748 15.29 220021 ..... 01.3635 23.88 220135 ..... 01.2397 24.67 230097 ..... 01.5928 19.03 230199 ..... 01.1846 16.61

200062 ..... 00.9125 15.03 220023 ..... 01.1724 19.92 220153 ..... 00.9842 19.37 230099 ..... 01.1191 18.90 230201 ..... 01.1826 14.03

200063 ..... 01.2548 18.27 220024 ..... 01.2011 20.61 220154 ..... 01.0025 20.72 230100 ..... 01.2050 14.82 230204 ..... 01.3955 20.13

200066 ..... 01.2157 15.65 220025 ..... 01.2146 19.07 220162 ..... 01.1174 .......... 230101 ..... 01.0781 17.28 230205 ..... 01.0457 13.00

210001 ..... 01.4359 19.45 220028 ..... 01.4903 21.29 220163 ..... 02.0494 24.21 230103 ..... 01.0526 17.37 230207 ..... 01.2669 21.19

210002 ..... 02.0301 16.46 220029 ..... 01.1504 23.54 220171 ..... 01.6465 21.72 230104 ..... 01.6096 21.24 230208 ..... 01.2412 18.18

210003 ..... 01.5454 22.78 220030 ..... 01.1142 17.02 230001 ..... 01.1916 18.72 230105 ..... 01.6864 19.47 230211 ..... 00.9096 14.11

210004 ..... 01.3604 21.20 220031 ..... 02.0045 29.21 230002 ..... 01.2641 18.80 230106 ..... 01.3011 18.64 230212 ..... 01.0720 22.89

210005 ..... 01.2337 18.52 220033 ..... 01.3844 19.62 230003 ..... 01.1456 18.79 230107 ..... 00.9245 11.54 230213 ..... 01.0473 13.19

210006 ..... 01.0987 17.09 220035 ..... 01.3148 19.49 230004 ..... 01.6847 24.03 230108 ..... 01.2350 18.02 230216 ..... 01.6086 19.50

210007 ..... 01.6811 20.55 220036 ..... 01.5951 22.33 230005 ..... 01.2549 18.69 230110 ..... 01.3936 17.31 230217 ..... 01.2395 19.60

210008 ..... 01.3385 19.03 220038 ..... 01.2902 21.60 230006 ..... 01.1078 15.91 230111 ..... 00.9900 17.97 230219 ..... 00.9318 16.58

210009 ..... 01.8256 19.93 220041 ..... 01.2145 21.02 230007 ..... 01.0590 17.82 230113 ..... 00.9699 18.07 230221 ..... 01.1033 17.78

210010 ..... 01.1897 16.40 220042 ..... 01.2037 25.43 230012 ..... 00.9618 11.92 230114 ..... 00.6644 25.66 230222 ..... 01.3910 18.46

210011 ..... 01.2790 21.24 220046 ..... 01.3759 23.55 230013 ..... 01.3026 20.55 230115 ..... 01.0034 15.79 230223 ..... 01.3134 21.86

210012 ..... 01.6303 21.50 220049 ..... 01.3204 21.16 230015 ..... 01.1338 19.54 230116 ..... 00.9514 14.84 230227 ..... 01.4686 22.63

210013 ..... 01.2454 18.65 220050 ..... 01.0930 18.78 230017 ..... 01.5755 20.51 230117 ..... 01.9294 25.77 230230 ..... 01.6739 21.30
Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations 46061

PAGE 8 OF 16

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230232 ..... 00.9775 18.31 240065 ..... 01.0639 10.79 240152 ..... 01.0432 18.30 250057 ..... 01.2901 14.84 260012 ..... 01.1120 12.21

230235 ..... 01.0780 14.12 240066 ..... 01.4080 18.87 240153 ..... 01.0196 15.01 250058 ..... 01.1584 13.20 260013 ..... 01.1128 13.85

230236 ..... 01.3039 21.82 240069 ..... 01.2138 18.58 240154 ..... 01.0483 14.45 250059 ..... 01.0879 14.15 260014 ..... 01.7531 18.62

230239 ..... 01.1599 16.38 240071 ..... 01.1332 17.67 240155 ..... 00.9544 16.25 250060 ..... 00.7832 10.79 260015 ..... 01.3476 12.13

230241 ..... 01.1124 17.56 240072 ..... 01.0874 17.53 240157 ..... 01.1163 11.54 250061 ..... 00.8589 09.59 260017 ..... 01.2927 14.90

230244 ..... 01.3635 21.20 240073 ..... 00.9506 15.03 240160 ..... 00.9811 15.61 250063 ..... 00.8529 12.96 260018 ..... 00.9297 10.14

230253 ..... 00.9665 18.09 240075 ..... 01.1877 19.26 240161 ..... 00.9741 14.77 250065 ..... 00.9859 11.60 260019 ..... 01.0453 12.50

230254 ..... 01.2864 21.85 240076 ..... 01.1076 20.82 240162 ..... 00.9992 15.08 250066 ..... 00.9305 14.05 260020 ..... 01.6738 20.95

230257 ..... 00.8638 18.77 240077 ..... 00.9344 12.01 240163 ..... 00.9475 14.68 250067 ..... 01.1461 15.22 260021 ..... 01.5109 18.46

230259 ..... 01.1898 19.63 240078 ..... 01.5036 21.81 240166 ..... 01.0721 15.70 250068 ..... 00.8507 09.05 260022 ..... 01.2923 16.51

230264 ..... 01.0486 19.01 240079 ..... 01.0478 13.53 240169 ..... 00.9590 15.46 250069 ..... 01.4098 13.92 260023 ..... 01.3274 16.81

230269 ..... 01.3682 22.82 240080 ..... 01.4004 21.73 240170 ..... 01.1711 14.40 250071 ..... 00.9012 10.90 260024 ..... 00.9475 12.58

230270 ..... 01.2231 20.42 240082 ..... 01.0933 15.87 240171 ..... 01.0599 14.30 250072 ..... 01.3508 16.19 260025 ..... 01.2408 14.22

230273 ..... 01.5791 21.61 240083 ..... 01.3701 16.80 240172 ..... 01.0622 14.86 250076 ..... 01.5698 08.95 260027 ..... 01.5512 20.66

230275 ..... 00.5037 16.62 240084 ..... 01.3013 17.76 240173 ..... 00.9750 14.79 250077 ..... 00.9415 11.54 260029 ..... 01.1498 16.88

230276 ..... 00.6974 17.39 240085 ..... 00.9624 15.55 240179 ..... 01.0875 15.05 250078 ..... 01.4511 14.35 260030 ..... 01.1773 10.28

230277 ..... 01.2458 21.07 240086 ..... 01.0731 15.22 240184 ..... 01.0888 11.77 250079 ..... 00.8988 13.59 260031 ..... 01.5415 18.47

230278 ..... 01.8501 21.54 240087 ..... 01.1736 15.74 240187 ..... 01.1716 18.89 250081 ..... 01.3350 15.13 260032 ..... 01.6162 18.24

230279 ..... 00.6949 15.06 240088 ..... 01.4370 18.72 240193 ..... 01.0850 15.54 250082 ..... 01.2696 12.99 260034 ..... 01.0286 15.30

230280 ..... 01.0876 14.88 240089 ..... 00.9741 15.79 240196 ..... 00.6148 22.86 250083 ..... 01.0209 10.67 260035 ..... 01.0432 11.67

240001 ..... 01.5822 22.07 240090 ..... 01.0671 13.53 240200 ..... 00.9038 13.54 250084 ..... 01.1159 15.95 260036 ..... 01.0354 18.28

240002 ..... 01.7315 20.58 240093 ..... 01.3382 16.86 240205 ..... 01.0346 .......... 250085 ..... 00.9834 12.43 260037 ..... 01.4487 15.56

240004 ..... 01.5268 21.05 240094 ..... 00.9928 17.38 240206 ..... 00.9570 .......... 250088 ..... 00.9081 14.66 260039 ..... 01.1663 12.17

240005 ..... 01.0266 15.07 240096 ..... 00.9783 14.74 240207 ..... 01.2804 22.23 250089 ..... 01.1680 13.27 260040 ..... 01.6549 15.94

240006 ..... 01.1154 20.02 240097 ..... 01.1033 18.17 240210 ..... 01.2460 22.69 250093 ..... 01.1083 12.75 260042 ..... 01.2618 16.78

240007 ..... 01.0769 15.81 240098 ..... 00.9425 16.39 240211 ..... 01.0014 11.52 250094 ..... 01.2614 14.92 260044 ..... 01.0934 14.86

240008 ..... 01.0662 16.32 240099 ..... 01.0621 10.76 250001 ..... 01.4559 16.92 250095 ..... 01.0168 14.72 260047 ..... 01.4644 15.90

240009 ..... 01.0015 14.35 240100 ..... 01.2967 18.25 250002 ..... 00.8370 14.44 250096 ..... 01.2783 15.77 260048 ..... 01.2365 19.25

240010 ..... 01.9744 21.16 240101 ..... 01.1792 17.70 250003 ..... 01.0137 15.14 250097 ..... 01.3211 13.86 260050 ..... 01.0968 14.63

240011 ..... 01.1601 15.71 240102 ..... 00.9227 12.87 250004 ..... 01.4726 16.68 250098 ..... 00.8662 14.72 260052 ..... 01.3373 16.89

240013 ..... 01.3128 16.96 240103 ..... 01.0701 13.76 250005 ..... 01.0613 10.43 250099 ..... 01.3168 12.67 260053 ..... 01.1651 10.83

240014 ..... 01.0839 19.10 240104 ..... 01.1850 21.72 250006 ..... 00.9608 14.73 250100 ..... 01.2729 14.27 260054 ..... 01.3178 14.83

240016 ..... 01.3772 16.31 240105 ..... 01.0170 12.35 250007 ..... 01.2974 18.24 250101 ..... 00.8766 09.75 260055 ..... 01.0236 08.93

240017 ..... 01.2008 15.66 240106 ..... 01.3884 23.85 250008 ..... 00.9270 11.91 250102 ..... 01.6510 14.56 260057 ..... 01.1559 14.12

240018 ..... 01.3331 17.17 240107 ..... 00.9699 14.74 250009 ..... 01.1951 15.81 250104 ..... 01.4468 16.31 260059 ..... 01.2358 11.75

240019 ..... 01.1997 20.69 240108 ..... 00.9753 12.35 250010 ..... 01.0272 11.88 250105 ..... 00.9242 11.52 260061 ..... 01.1323 11.91

240020 ..... 01.1545 20.05 240109 ..... 00.9763 12.06 250012 ..... 00.9493 13.18 250107 ..... 00.8879 14.99 260062 ..... 01.2004 17.75

240021 ..... 01.0040 13.13 240110 ..... 00.9880 14.66 250015 ..... 01.1025 10.43 250109 ..... 00.9619 12.97 260063 ..... 01.1235 15.61

240022 ..... 01.1171 18.13 240111 ..... 01.0264 15.65 250017 ..... 00.9743 14.92 250112 ..... 00.9503 14.95 260064 ..... 01.3135 15.06

240023 ..... 01.1030 16.17 240112 ..... 01.0120 14.22 250018 ..... 01.0885 11.21 250117 ..... 01.0158 13.39 260065 ..... 01.7978 16.07

240025 ..... 01.1265 14.54 240114 ..... 00.8971 13.21 250019 ..... 01.4948 16.51 250119 ..... 01.1128 11.94 260066 ..... 01.0288 15.31

240027 ..... 01.0280 15.50 240115 ..... 01.6575 21.53 250020 ..... 00.9503 11.47 250120 ..... 01.0898 13.47 260067 ..... 00.9511 10.89

240028 ..... 01.1803 18.14 240116 ..... 00.9560 12.54 250021 ..... 00.9206 08.33 250122 ..... 01.2659 .......... 260068 ..... 01.6925 19.07

240029 ..... 01.2190 17.00 240117 ..... 01.1415 17.40 250023 ..... 00.8554 .......... 250123 ..... 01.3245 18.31 260070 ..... 01.0637 12.16

240030 ..... 01.2864 17.33 240119 ..... 00.8838 17.45 250024 ..... 00.9613 08.37 250124 ..... 00.9107 11.28 260073 ..... 01.0411 11.87

240031 ..... 00.9918 13.83 240121 ..... 00.9377 17.85 250025 ..... 01.1325 15.43 250125 ..... 01.3265 18.00 260074 ..... 01.3241 17.22

240036 ..... 01.5677 19.89 240122 ..... 01.0774 16.25 250027 ..... 01.0193 11.14 250126 ..... 00.9963 13.81 260077 ..... 01.7094 16.86

240037 ..... 01.0459 17.05 240123 ..... 01.0887 13.80 250029 ..... 00.8793 11.91 250127 ..... 00.7981 10.67 260078 ..... 01.2180 14.84

240038 ..... 01.4768 24.33 240124 ..... 00.9980 16.84 250030 ..... 00.9894 11.26 250128 ..... 01.1054 11.86 260079 ..... 01.0338 11.96

240040 ..... 01.1838 19.00 240125 ..... 00.9119 12.16 250031 ..... 01.3401 17.65 250131 ..... 00.9853 10.41 260080 ..... 01.0487 10.85

240041 ..... 01.2688 15.42 240127 ..... 01.0956 12.16 250032 ..... 01.2651 15.27 250134 ..... 00.9847 15.67 260081 ..... 01.5242 18.50

240043 ..... 01.2180 17.60 240128 ..... 01.1103 14.99 250033 ..... 01.1179 12.63 250136 ..... 00.9293 15.06 260082 ..... 01.1931 13.85

240044 ..... 01.1777 16.75 240129 ..... 01.0683 13.13 250034 ..... 01.6275 13.70 250138 ..... 01.2493 16.52 260085 ..... 01.5683 18.89

240045 ..... 01.1170 18.25 240130 ..... 01.0694 15.14 250035 ..... 00.8775 13.38 250141 ..... 01.2384 16.11 260086 ..... 00.9991 13.83

240047 ..... 01.5112 19.66 240132 ..... 01.2511 21.26 250036 ..... 01.0177 10.97 250145 ..... 00.9805 .......... 260089 ..... 01.0806 12.16

240048 ..... 01.2509 21.83 240133 ..... 01.1407 16.89 250037 ..... 00.8394 09.52 250146 ..... 01.0293 12.44 260091 ..... 01.6447 20.21

240049 ..... 01.7860 21.16 240135 ..... 00.9022 11.98 250038 ..... 00.9491 12.49 250148 ..... 01.1361 14.14 260094 ..... 01.2142 17.53

240050 ..... 01.1382 22.26 240137 ..... 01.2280 15.99 250039 ..... 01.0330 12.23 250149 ..... 00.9158 12.56 260095 ..... 01.4130 15.92

240051 ..... 00.9385 14.60 240138 ..... 00.9613 12.39 250040 ..... 01.3378 16.36 260001 ..... 01.6347 16.79 260096 ..... 01.5959 23.01

240052 ..... 01.2651 18.14 240139 ..... 00.9705 14.07 250042 ..... 01.2431 13.72 260002 ..... 01.4563 20.60 260097 ..... 01.1569 16.79

240053 ..... 01.5135 19.37 240141 ..... 01.1692 18.92 250043 ..... 01.0021 11.48 260003 ..... 00.9752 13.10 260100 ..... 01.0555 13.31

240056 ..... 01.2694 21.66 240142 ..... 01.1055 15.56 250044 ..... 00.9974 14.17 260004 ..... 01.0307 12.81 260102 ..... 01.0467 17.58

240057 ..... 01.7845 21.08 240143 ..... 01.1220 11.76 250045 ..... 01.1352 17.75 260005 ..... 01.6959 20.17 260103 ..... 01.3939 16.96

240058 ..... 00.9705 08.83 240144 ..... 01.0129 13.66 250047 ..... 00.9859 11.39 260006 ..... 01.4637 16.81 260104 ..... 01.7038 18.80

240059 ..... 01.1096 19.63 240145 ..... 00.9274 12.01 250048 ..... 01.5334 14.39 260007 ..... 01.6391 14.42 260105 ..... 01.8450 21.41

240061 ..... 01.7813 21.05 240146 ..... 00.9883 18.68 250049 ..... 00.9044 11.19 260008 ..... 01.2715 16.18 260107 ..... 01.4336 19.39

240063 ..... 01.5152 22.26 240148 ..... 01.0915 08.84 250050 ..... 01.2911 12.79 260009 ..... 01.2277 15.64 260108 ..... 01.8662 18.57

240064 ..... 01.2556 20.39 240150 ..... 00.8854 12.16 250051 ..... 00.8720 08.88 260011 ..... 01.6403 17.12 260109 ..... 00.9885 11.86
46062 Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations

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260110 ..... 01.5703 14.92 270035 ..... 01.0128 16.94 280050 ..... 00.9679 13.74 290021 ..... 01.6450 19.51 310041 ..... 01.3388 21.96

260113 ..... 01.0828 14.31 270036 ..... 00.9373 09.94 280051 ..... 01.2066 13.85 290022 ..... 01.6828 20.47 310042 ..... 01.2149 22.13

260115 ..... 01.2400 14.59 270039 ..... 01.0684 12.96 280052 ..... 00.9828 12.52 290027 ..... 00.9732 15.03 310043 ..... 01.2896 19.99

260116 ..... 01.1030 13.89 270040 ..... 01.0918 19.79 280054 ..... 01.2703 16.10 290029 ..... 00.8983 .......... 310044 ..... 01.3360 20.03

260119 ..... 01.1917 13.28 270041 ..... 01.0796 11.52 280055 ..... 00.9249 12.19 290032 ..... 01.4471 18.24 310045 ..... 01.4249 27.62

260120 ..... 01.2217 14.60 270044 ..... 01.1485 14.40 280056 ..... 01.0135 13.28 290036 ..... 01.0870 13.90 310047 ..... 01.3531 24.05

260122 ..... 01.1474 13.40 270046 ..... 00.9270 13.70 280057 ..... 00.9801 15.61 290038 ..... 00.9351 17.61 310048 ..... 01.2560 21.34

260123 ..... 01.0221 12.27 270048 ..... 01.0968 14.13 280058 ..... 01.3647 14.36 290039 ..... 01.3412 .......... 310049 ..... 01.3224 23.91

260127 ..... 00.9860 13.88 270049 ..... 01.8343 19.33 280060 ..... 01.5785 18.24 300001 ..... 01.3841 21.03 310050 ..... 01.2281 21.48

260128 ..... 01.0214 09.22 270050 ..... 01.0747 17.43 280061 ..... 01.4895 15.95 300003 ..... 01.8856 21.59 310051 ..... 01.3357 23.27

260129 ..... 01.2018 13.53 270051 ..... 01.3399 19.12 280062 ..... 01.1451 12.55 300005 ..... 01.2741 19.13 310052 ..... 01.2886 21.19

260131 ..... 01.4057 15.91 270052 ..... 01.0912 12.73 280064 ..... 01.0800 13.94 300006 ..... 01.1402 17.36 310054 ..... 01.3056 23.97

260134 ..... 01.1561 14.28 270053 ..... 00.9396 09.78 280065 ..... 01.2745 17.49 300007 ..... 01.1618 17.04 310056 ..... 01.3867 20.63

260137 ..... 01.5544 14.25 270057 ..... 01.2164 18.21 280066 ..... 01.0357 11.48 300008 ..... 01.2110 18.30 310057 ..... 01.2922 23.67

260138 ..... 01.8949 21.17 270058 ..... 00.9476 11.51 280068 ..... 01.0870 09.89 300009 ..... 01.1504 18.16 310058 ..... 01.0906 26.79

260141 ..... 01.9549 17.43 270059 ..... 00.8656 15.65 280070 ..... 01.0149 11.63 300010 ..... 01.2297 17.88 310060 ..... 01.2000 18.73

260142 ..... 01.2382 13.99 270060 ..... 00.9067 13.00 280073 ..... 01.0115 13.94 300011 ..... 01.3613 22.07 310061 ..... 01.2538 20.23

260143 ..... 00.9915 11.96 270063 ..... 00.9363 14.23 280074 ..... 01.1316 13.76 300012 ..... 01.3381 21.42 310062 ..... 01.2965 24.98

260147 ..... 01.0190 12.74 270068 ..... 00.9009 15.59 280075 ..... 01.2322 13.10 300013 ..... 01.1476 17.06 310063 ..... 01.3660 21.28

260148 ..... 00.9522 09.30 270072 ..... 00.7740 11.39 280076 ..... 01.0519 12.93 300014 ..... 01.2209 19.36 310064 ..... 01.2783 22.29

260158 ..... 01.1057 11.77 270073 ..... 01.1623 11.16 280077 ..... 01.3421 17.26 300015 ..... 01.1797 18.08 310067 ..... 01.3279 23.76

260159 ..... 01.0850 19.81 270074 ..... 00.8787 .......... 280079 ..... 01.2143 10.42 300016 ..... 01.2009 15.73 310069 ..... 01.2838 20.03

260160 ..... 01.0947 11.84 270075 ..... 00.9757 .......... 280080 ..... 01.0583 12.11 300017 ..... 01.2344 21.96 310070 ..... 01.4058 22.98

260162 ..... 01.5751 19.55 270076 ..... 00.7949 .......... 280081 ..... 01.6898 18.79 300018 ..... 01.2172 19.62 310072 ..... 01.2874 20.57

260163 ..... 01.3342 15.35 270079 ..... 00.9165 13.66 280082 ..... 01.0127 13.48 300019 ..... 01.2814 18.78 310073 ..... 01.6854 23.77

260164 ..... 00.9984 12.17 270080 ..... 01.2060 15.54 280083 ..... 01.1020 14.54 300020 ..... 01.2710 20.72 310074 ..... 01.4715 22.61

260166 ..... 01.2345 21.39 270081 ..... 01.0741 12.39 280084 ..... 01.0433 11.01 300021 ..... 01.1849 15.34 310075 ..... 01.3895 23.13

260172 ..... 00.9976 12.72 270082 ..... 01.0736 14.48 280088 ..... 01.7915 17.98 300022 ..... 01.1134 17.22 310076 ..... 01.4399 28.74

260173 ..... 01.0104 11.78 270083 ..... 01.0503 16.28 280089 ..... 01.0285 14.37 300023 ..... 01.2978 19.78 310077 ..... 01.5635 23.51

260175 ..... 01.1633 14.99 270084 ..... 00.9318 14.12 280090 ..... 00.9935 13.49 300024 ..... 01.1828 16.74 310078 ..... 01.3027 24.59

260176 ..... 01.7313 18.43 280001 ..... 01.1150 12.98 280091 ..... 01.2088 14.18 300028 ..... 01.2388 16.75 310081 ..... 01.2885 21.29

260177 ..... 01.3273 20.42 280003 ..... 02.0371 19.15 280092 ..... 00.8942 12.18 300029 ..... 01.3275 22.39 310083 ..... 01.2987 22.33

260178 ..... 01.4928 18.91 280005 ..... 01.4351 17.19 280094 ..... 01.0535 14.07 300033 ..... 01.1132 13.69 310084 ..... 01.3541 21.20

260179 ..... 01.6451 18.70 280009 ..... 01.7538 17.25 280097 ..... 01.0852 12.27 300034 ..... 02.0364 23.29 310086 ..... 01.2266 21.30

260180 ..... 01.7006 20.07 280011 ..... 00.8644 11.91 280098 ..... 00.9677 10.40 310001 ..... 01.7992 26.40 310087 ..... 01.2818 19.26

260183 ..... 01.5643 16.14 280012 ..... 01.3040 15.43 280101 ..... 01.0917 13.18 310002 ..... 01.7327 26.31 310088 ..... 01.2278 20.64

260186 ..... 01.2995 15.97 280013 ..... 01.8405 20.57 280102 ..... 01.1442 12.76 310003 ..... 01.2627 24.08 310090 ..... 01.2294 25.46

260188 ..... 01.2526 18.64 280014 ..... 00.9583 13.39 280104 ..... 00.9763 10.84 310005 ..... 01.2319 20.54 310091 ..... 01.3343 20.80

260189 ..... 00.8480 11.26 280015 ..... 01.0124 15.19 280105 ..... 01.3758 17.28 310006 ..... 01.2052 19.62 310092 ..... 01.3108 20.70

260190 ..... 01.2528 18.90 280017 ..... 01.1012 13.94 280106 ..... 00.9288 13.93 310008 ..... 01.3806 22.73 310093 ..... 01.1706 19.79

260191 ..... 01.2514 17.92 280018 ..... 01.0931 13.35 280107 ..... 01.0876 11.13 310009 ..... 01.2807 22.80 310096 ..... 01.8668 23.17

260193 ..... 01.2323 18.75 280020 ..... 01.6154 18.93 280108 ..... 01.2167 13.96 310010 ..... 01.2537 20.92 310105 ..... 01.2442 23.63

260195 ..... 01.1679 14.49 280021 ..... 01.3263 15.49 280109 ..... 00.9153 09.80 310011 ..... 01.2873 21.55 310108 ..... 01.4315 21.85

260197 ..... 01.1444 20.98 280022 ..... 01.0087 12.52 280110 ..... 01.0169 11.19 310012 ..... 01.5915 24.33 310110 ..... 01.2368 20.38

260198 ..... 01.3378 15.86 280023 ..... 01.4093 15.69 280111 ..... 01.2161 15.63 310013 ..... 01.2770 21.84 310111 ..... 01.3068 20.46

260200 ..... 01.3613 19.10 280024 ..... 00.9413 13.05 280114 ..... 00.9765 12.99 310014 ..... 01.7131 24.26 310112 ..... 01.3241 21.02

270002 ..... 01.2856 15.06 280025 ..... 00.9422 12.14 280115 ..... 00.9474 14.77 310015 ..... 01.9529 24.97 310113 ..... 01.2395 20.60

270003 ..... 01.2214 19.98 280026 ..... 01.0265 15.28 280117 ..... 01.1921 14.47 310016 ..... 01.2564 22.34 310115 ..... 01.2923 19.31

270004 ..... 01.7045 19.96 280028 ..... 01.0549 14.53 280118 ..... 00.9889 15.17 310017 ..... 01.3661 23.40 310116 ..... 01.2370 21.96

270006 ..... 01.0898 14.78 280029 ..... 01.2195 14.02 280119 ..... 00.8659 .......... 310018 ..... 01.1268 20.55 310118 ..... 01.2551 22.53

270007 ..... 00.9224 13.18 280030 ..... 01.7278 24.40 280123 ..... 00.9506 15.63 310019 ..... 01.6124 23.53 310119 ..... 01.6198 30.37

270009 ..... 01.0810 15.34 280031 ..... 01.0191 13.10 290001 ..... 01.6662 21.85 310020 ..... 01.2521 21.55 310120 ..... 01.0709 17.44

270011 ..... 01.0719 15.52 280032 ..... 01.3303 15.57 290002 ..... 00.9831 17.79 310021 ..... 01.3931 22.03 310121 ..... 01.1650 20.34

270012 ..... 01.6741 17.63 280033 ..... 01.0971 14.24 290003 ..... 01.6600 20.74 310022 ..... 01.2806 21.47 320001 ..... 01.4682 17.14

270013 ..... 01.4138 17.77 280034 ..... 01.3131 13.86 290005 ..... 01.4915 19.03 310024 ..... 01.3560 22.85 320002 ..... 01.3511 20.74

270014 ..... 01.7987 16.83 280035 ..... 00.9238 11.81 290006 ..... 01.1731 16.15 310025 ..... 01.2619 22.27 320003 ..... 01.1841 15.65

270016 ..... 00.9321 13.23 280037 ..... 01.0168 14.28 290007 ..... 01.9114 27.06 310026 ..... 01.2312 22.67 320004 ..... 01.2645 17.19

270017 ..... 01.3064 18.66 280038 ..... 01.0809 14.53 290008 ..... 01.1790 18.73 310027 ..... 01.3355 20.94 320005 ..... 01.3203 18.87

270019 ..... 01.0378 14.02 280039 ..... 01.1314 13.99 290009 ..... 01.5603 22.25 310028 ..... 01.1787 21.21 320006 ..... 01.3638 15.96

270021 ..... 01.1545 16.23 280040 ..... 01.6214 18.67 290010 ..... 01.1286 11.93 310029 ..... 01.9766 22.49 320009 ..... 01.5899 16.52

270023 ..... 01.3584 20.28 280041 ..... 00.9179 11.80 290011 ..... 01.0396 14.67 310031 ..... 02.8736 24.35 320011 ..... 01.0253 17.06

270024 ..... 00.9913 13.05 280042 ..... 01.1032 13.11 290012 ..... 01.3984 20.71 310032 ..... 01.3445 21.17 320012 ..... 00.9834 16.21

270026 ..... 00.9309 12.95 280043 ..... 01.0605 14.76 290013 ..... 01.0682 15.39 310034 ..... 01.2696 21.26 320013 ..... 01.1618 19.19

270027 ..... 01.0785 11.91 280045 ..... 01.2844 13.63 290014 ..... 01.0288 16.38 310036 ..... 01.1474 19.86 320014 ..... 01.1042 13.79

270028 ..... 01.0841 15.37 280046 ..... 01.1494 11.04 290015 ..... 01.0036 15.04 310037 ..... 01.3407 26.92 320016 ..... 01.1839 13.77

270029 ..... 00.9507 16.24 280047 ..... 01.0939 15.54 290016 ..... 01.2251 19.81 310038 ..... 02.0204 24.49 320017 ..... 01.1548 16.85

270032 ..... 01.1189 15.80 280048 ..... 01.1833 12.06 290019 ..... 01.3517 19.06 310039 ..... 01.2885 21.42 320018 ..... 01.5098 17.37

270033 ..... 00.8853 12.22 280049 ..... 01.0480 13.94 290020 ..... 01.0868 17.08 310040 ..... 01.2597 24.06 320019 ..... 01.5443 22.95
Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations 46063

PAGE 10 OF 16

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320021 ..... 01.7533 17.31 330057 ..... 01.6977 16.97 330167 ..... 01.7092 28.82 330265 ..... 01.3607 16.53 340021 ..... 01.2689 16.22

320022 ..... 01.2423 16.07 330058 ..... 01.3103 15.76 330169 ..... 01.4110 32.57 330267 ..... 01.2246 23.35 340022 ..... 01.0375 14.98

320023 ..... 00.9909 16.72 330059 ..... 01.5940 29.90 330171 ..... 01.3203 21.95 330268 ..... 01.0334 14.44 340023 ..... 01.4060 17.97

320030 ..... 01.0487 18.27 330061 ..... 01.3131 23.60 330175 ..... 01.1554 14.35 330270 ..... 01.9732 32.47 340024 ..... 01.1772 15.07

320031 ..... 00.9027 12.36 330062 ..... 01.1628 15.58 330177 ..... 01.0005 13.74 330273 ..... 01.3707 23.35 340025 ..... 01.1840 14.99

320032 ..... 00.9301 15.10 330064 ..... 01.4496 29.63 330179 ..... 00.8725 14.38 330275 ..... 01.3082 18.58 340027 ..... 01.1891 15.59

320033 ..... 01.1267 20.90 330065 ..... 01.1872 17.24 330180 ..... 01.1898 16.40 330276 ..... 01.1936 17.02 340028 ..... 01.5458 17.32

320035 ..... 00.9731 14.58 330066 ..... 01.3095 17.55 330181 ..... 01.3087 30.46 330277 ..... 01.1398 16.32 340030 ..... 02.0708 20.58

320037 ..... 01.2157 15.59 330067 ..... 01.3397 20.60 330182 ..... 02.4691 28.41 330279 ..... 01.3457 18.52 340031 ..... 01.0081 11.97

320038 ..... 01.2291 13.85 330072 ..... 01.3517 27.84 330183 ..... 01.5101 18.74 330285 ..... 01.7862 22.52 340032 ..... 01.3860 18.60

320046 ..... 01.2573 18.15 330073 ..... 01.1565 14.87 330184 ..... 01.3734 26.85 330286 ..... 01.3224 24.25 340035 ..... 01.1828 15.73

320048 ..... 01.3064 17.40 330074 ..... 01.2166 18.14 330185 ..... 01.3291 25.44 330290 ..... 01.7785 29.90 340036 ..... 01.2472 17.33

320056 ..... 00.9777 .......... 330075 ..... 01.0853 17.25 330186 ..... 00.8858 19.79 330293 ..... 01.1588 13.48 340037 ..... 01.1215 15.85

320057 ..... 00.9860 .......... 330078 ..... 01.3888 17.05 330188 ..... 01.2089 18.28 330304 ..... 01.2571 27.34 340038 ..... 01.0707 15.42

320058 ..... 00.8563 .......... 330079 ..... 01.2315 17.05 330189 ..... 01.4328 16.85 330306 ..... 01.4672 27.44 340039 ..... 01.2910 19.52

320059 ..... 01.1562 .......... 330080 ..... 01.4550 27.21 330191 ..... 01.3345 17.14 330307 ..... 01.2474 19.43 340040 ..... 01.7921 18.22

320060 ..... 00.9435 .......... 330084 ..... 01.0610 16.46 330193 ..... 01.3182 27.97 330308 ..... 01.2507 29.68 340041 ..... 01.2364 17.24

320061 ..... 01.1137 .......... 330085 ..... 01.3273 18.64 330194 ..... 01.8320 29.32 330309 ..... 01.2698 24.10 340042 ..... 01.1970 14.01

320062 ..... 00.9094 .......... 330086 ..... 01.2423 24.99 330195 ..... 01.6507 29.85 330314 ..... 01.4593 22.18 340044 ..... 01.0253 13.44

320063 ..... 01.2911 16.46 330088 ..... 01.0571 24.62 330196 ..... 01.3114 00.34 330315 ..... 16.1090 25.23 340045 ..... 00.9968 09.61

320065 ..... 01.3721 17.00 330090 ..... 01.5514 16.76 330197 ..... 01.0574 14.99 330316 ..... 01.2635 21.85 340047 ..... 01.8734 18.38

320067 ..... 00.8637 17.64 330091 ..... 01.3268 18.50 330198 ..... 01.4037 22.87 330327 ..... 00.9920 16.17 340048 ..... 00.8186 14.02

320068 ..... 00.8763 15.36 330092 ..... 01.1180 14.07 330199 ..... 01.4010 25.87 330331 ..... 01.2269 29.77 340049 ..... 00.6961 13.94

320069 ..... 00.9960 10.67 330094 ..... 01.1768 16.51 330201 ..... 01.6465 27.62 330332 ..... 01.2958 26.61 340050 ..... 01.1941 17.37

320070 ..... 00.9059 .......... 330095 ..... 01.2330 17.55 330202 ..... 01.6534 28.76 330333 ..... 01.2526 23.81 340051 ..... 01.3394 16.08

320074 ..... 01.0785 17.04 330096 ..... 01.0917 15.45 330203 ..... 01.3909 19.06 330336 ..... 01.3450 28.99 340052 ..... 01.0093 18.41

320079 ..... 01.1533 17.22 330097 ..... 01.2483 15.36 330204 ..... 01.4006 30.31 330338 ..... 01.2358 23.09 340053 ..... 01.6663 19.08

330001 ..... 01.1757 25.49 330100 ..... 00.7182 26.07 330205 ..... 01.1539 20.29 330339 ..... 00.8847 18.73 340054 ..... 01.1083 13.09

330002 ..... 01.4142 25.22 330101 ..... 01.7684 33.56 330208 ..... 01.2513 24.55 330340 ..... 01.1880 21.17 340055 ..... 01.1907 17.40

330003 ..... 01.3152 17.67 330102 ..... 01.3513 17.47 330209 ..... 01.2154 23.11 330350 ..... 01.8015 28.27 340060 ..... 01.1491 16.69

330004 ..... 01.3320 19.08 330103 ..... 01.2733 16.46 330211 ..... 01.1993 17.23 330353 ..... 01.3368 30.33 340061 ..... 01.7040 19.91

330005 ..... 01.7984 20.49 330104 ..... 01.3905 26.74 330212 ..... 01.1041 21.12 330354 ..... 01.5264 .......... 340063 ..... 01.0417 13.08

330006 ..... 01.2710 23.92 330106 ..... 01.5962 34.42 330213 ..... 01.1771 16.58 330357 ..... 01.3809 33.49 340064 ..... 01.2144 17.12

330007 ..... 01.3464 17.71 330107 ..... 01.3262 25.92 330214 ..... 01.7550 29.72 330359 ..... 00.9243 19.54 340065 ..... 01.3430 14.39

330008 ..... 01.2061 15.62 330108 ..... 01.2139 16.28 330215 ..... 01.2276 15.66 330372 ..... 01.2018 24.47 340067 ..... 01.2792 15.88

330009 ..... 01.3815 30.32 330111 ..... 01.0633 14.81 330218 ..... 01.1335 17.94 330381 ..... 01.1971 28.03 340068 ..... 01.2351 14.77

330010 ..... 01.2801 15.07 330114 ..... 00.9802 16.13 330219 ..... 01.6778 19.13 330385 ..... 01.1776 -2.89 340069 ..... 01.7382 19.47

330011 ..... 01.3290 17.81 330115 ..... 01.2248 15.23 330221 ..... 01.3386 27.53 330386 ..... 01.2009 22.53 340070 ..... 01.3823 17.57

330012 ..... 01.7038 31.01 330116 ..... 00.9813 14.21 330222 ..... 01.2772 17.64 330387 ..... 01.0268 23.95 340071 ..... 01.0851 15.08

330013 ..... 02.0608 17.36 330118 ..... 01.6299 18.94 330223 ..... 01.0642 15.37 330389 ..... 01.7489 29.43 340072 ..... 01.0654 15.20

330014 ..... 01.3788 30.31 330119 ..... 01.7640 33.48 330224 ..... 01.2453 20.32 330390 ..... 01.2900 30.36 340073 ..... 01.5496 20.23

330016 ..... 01.0547 15.47 330121 ..... 01.0392 16.10 330225 ..... 01.1722 24.43 330393 ..... 01.7141 27.22 340075 ..... 01.2024 16.26

330019 ..... 01.2902 25.33 330122 ..... 01.0867 21.84 330226 ..... 01.2740 17.05 330394 ..... 01.5390 17.96 340080 ..... 01.0607 12.72

330020 ..... 01.0620 15.26 330125 ..... 01.8729 19.78 330229 ..... 01.3074 15.73 330395 ..... 01.3045 30.64 340084 ..... 01.0587 15.61

330023 ..... 01.2479 23.30 330126 ..... 01.1881 22.34 330230 ..... 01.4285 28.69 330396 ..... 01.3520 24.91 340085 ..... 01.1720 15.65

330024 ..... 01.8143 30.17 330127 ..... 01.3437 24.82 330231 ..... 01.0938 30.02 330397 ..... 01.2858 25.47 340087 ..... 01.1024 16.01

330025 ..... 01.1813 18.51 330128 ..... 01.3917 28.29 330232 ..... 01.2394 16.42 330398 ..... 01.2749 26.92 340088 ..... 01.1388 16.42

330027 ..... 01.4780 30.17 330132 ..... 01.0770 14.60 330233 ..... 01.5512 29.70 330399 ..... 01.2737 29.65 340089 ..... 01.0348 12.85

330028 ..... 01.4234 24.95 330133 ..... 01.3665 30.50 330234 ..... 02.2563 29.60 340001 ..... 01.5504 19.47 340090 ..... 01.1542 17.15

330029 ..... 01.0148 19.09 330135 ..... 01.1572 18.28 330235 ..... 01.1452 18.33 340002 ..... 01.8974 18.38 340091 ..... 01.7238 19.42

330030 ..... 01.2083 14.75 330136 ..... 01.2992 16.54 330236 ..... 01.4044 27.87 340003 ..... 01.1484 17.08 340093 ..... 01.0733 12.10

330033 ..... 01.2824 13.81 330140 ..... 01.7638 17.79 330238 ..... 01.2306 14.19 340004 ..... 01.4886 17.16 340094 ..... 01.4431 17.65

330034 ..... 00.7369 32.72 330141 ..... 01.3548 24.27 330239 ..... 01.1936 15.39 340005 ..... 01.1591 13.24 340096 ..... 01.1673 17.33

330036 ..... 01.2231 22.66 330144 ..... 00.9791 13.70 330240 ..... 01.3305 28.41 340006 ..... 01.0881 14.60 340097 ..... 01.1830 16.61

330037 ..... 01.1592 14.92 330148 ..... 01.0830 14.58 330241 ..... 01.9102 22.54 340007 ..... 01.1617 16.20 340098 ..... 01.7209 19.46

330038 ..... 01.2065 14.81 330151 ..... 01.0751 14.55 330242 ..... 01.3802 23.99 340008 ..... 01.1475 16.97 340099 ..... 01.1578 12.70

330039 ..... 00.8432 14.25 330152 ..... 01.4444 28.88 330245 ..... 01.3022 17.51 340009 ..... 01.4763 19.70 340101 ..... 01.1697 11.80

330041 ..... 01.3306 30.19 330153 ..... 01.7128 17.15 330246 ..... 01.3541 25.33 340010 ..... 01.3236 16.97 340104 ..... 00.8600 12.36

330043 ..... 01.3108 26.60 330154 ..... 01.6429 .......... 330247 ..... 00.7659 29.15 340011 ..... 01.1355 14.36 340105 ..... 01.3859 17.94

330044 ..... 01.2722 17.63 330157 ..... 01.3608 19.48 330249 ..... 01.1711 15.98 340012 ..... 01.3193 15.92 340106 ..... 01.2109 18.52

330045 ..... 01.4075 26.13 330158 ..... 01.4129 23.06 330250 ..... 01.3086 16.89 340013 ..... 01.2557 15.63 340107 ..... 01.4165 16.65

330046 ..... 01.4956 29.75 330159 ..... 01.3177 17.67 330252 ..... 00.8785 15.72 340014 ..... 01.5864 22.01 340109 ..... 01.3485 16.84

330047 ..... 01.2551 16.37 330160 ..... 01.4457 29.16 330254 ..... 01.1651 15.21 340015 ..... 01.3037 17.05 340111 ..... 01.1783 13.75

330048 ..... 01.2230 16.94 330161 ..... 00.7222 16.75 330258 ..... 01.3696 26.99 340016 ..... 01.2047 15.58 340112 ..... 01.0683 13.87

330049 ..... 01.3252 17.74 330162 ..... 01.2585 26.51 330259 ..... 01.5046 22.78 340017 ..... 01.2671 16.06 340113 ..... 02.0121 21.03

330053 ..... 01.1943 15.15 330163 ..... 01.2523 18.88 330261 ..... 01.2906 25.24 340018 ..... 01.1777 15.29 340114 ..... 01.5618 19.74

330055 ..... 01.4882 31.04 330164 ..... 01.3928 19.40 330263 ..... 01.0194 18.52 340019 ..... 01.0467 13.86 340115 ..... 01.5417 18.15

330056 ..... 01.3144 27.86 330166 ..... 01.0011 15.11 330264 ..... 01.2443 23.18 340020 ..... 01.2083 17.65 340116 ..... 01.8211 20.54
46064 Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations

PAGE 11 OF 16

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340119 ..... 01.2911 16.28 350041 ..... 00.9769 14.99 360062 ..... 01.5165 19.27 360143 ..... 01.3986 18.13 370012 ..... 00.8913 09.07

340120 ..... 01.0917 12.31 350042 ..... 01.0876 11.16 360063 ..... 01.1515 18.08 360144 ..... 01.3179 20.90 370013 ..... 01.7919 19.41

340121 ..... 01.1182 15.36 350043 ..... 01.7067 16.69 360064 ..... 01.6063 21.61 360145 ..... 01.6494 17.67 370014 ..... 01.2905 18.49

340123 ..... 01.1194 16.92 350044 ..... 00.8710 10.29 360065 ..... 01.2762 17.59 360147 ..... 01.2388 15.85 370015 ..... 01.2695 14.88

340124 ..... 01.0603 13.70 350047 ..... 01.1747 16.78 360066 ..... 01.4343 18.88 360148 ..... 01.1249 17.65 370016 ..... 01.4272 15.52

340125 ..... 01.4926 18.36 350049 ..... 01.2578 10.74 360067 ..... 01.2705 12.77 360149 ..... 01.2285 17.72 370017 ..... 01.0956 11.48

340126 ..... 01.4258 16.47 350050 ..... 00.9330 10.74 360068 ..... 01.7423 22.41 360150 ..... 01.2490 19.17 370018 ..... 01.3350 16.66

340127 ..... 01.2939 15.72 350051 ..... 00.9947 15.46 360069 ..... 01.1370 16.74 360151 ..... 01.3513 17.46 370019 ..... 01.2757 13.17

340129 ..... 01.2939 17.50 350053 ..... 01.0948 10.34 360070 ..... 01.7333 17.18 360152 ..... 01.4715 17.88 370020 ..... 01.3047 12.51

340130 ..... 01.4419 17.78 350055 ..... 00.8596 12.12 360071 ..... 01.3523 16.78 360153 ..... 01.1796 14.12 370021 ..... 00.8951 09.76

340131 ..... 01.5338 17.10 350056 ..... 00.9765 12.81 360072 ..... 01.2124 16.99 360154 ..... 01.0368 12.79 370022 ..... 01.2941 16.91

340132 ..... 01.4383 13.48 350058 ..... 00.8563 12.32 360074 ..... 01.3725 19.42 360155 ..... 01.3327 19.43 370023 ..... 01.3248 15.36

340133 ..... 01.0956 14.59 350060 ..... 00.7725 07.81 360075 ..... 01.4496 20.74 360156 ..... 01.3468 17.17 370025 ..... 01.3637 16.03

340137 ..... 01.1410 16.93 350061 ..... 01.0745 14.05 360076 ..... 01.3490 17.88 360159 ..... 01.2231 19.63 370026 ..... 01.4154 16.34

340138 ..... 01.0567 14.77 350063 ..... 00.8461 .......... 360077 ..... 01.5389 19.34 360161 ..... 01.2521 19.38 370028 ..... 01.9042 19.01

340141 ..... 01.6716 19.46 350064 ..... 00.9598 .......... 360078 ..... 01.3080 20.54 360162 ..... 01.2452 18.42 370029 ..... 01.2199 13.67

340142 ..... 01.2340 14.52 350066 ..... 00.4249 .......... 360079 ..... 01.8681 21.00 360163 ..... 01.8349 19.83 370030 ..... 01.2212 15.66

340143 ..... 01.4482 17.07 360001 ..... 01.3384 16.97 360080 ..... 01.1083 15.47 360164 ..... 00.9007 14.82 370032 ..... 01.5792 15.46

340144 ..... 01.3645 18.62 360002 ..... 01.2162 16.93 360081 ..... 01.3841 19.32 360165 ..... 01.1742 14.70 370033 ..... 01.0221 11.30

340145 ..... 01.4125 16.83 360003 ..... 01.7712 21.00 360082 ..... 01.3414 20.33 360166 ..... 01.2030 14.95 370034 ..... 01.2616 13.35

340146 ..... 01.0456 12.52 360006 ..... 01.7607 20.88 360083 ..... 01.2828 16.28 360170 ..... 01.3775 17.38 370035 ..... 01.6378 16.49

340147 ..... 01.3150 18.57 360007 ..... 01.0849 16.02 360084 ..... 01.6067 19.41 360172 ..... 01.3901 16.51 370036 ..... 01.1174 10.48

340148 ..... 01.5007 18.58 360008 ..... 01.2525 17.40 360085 ..... 01.7980 20.40 360174 ..... 01.3088 17.57 370037 ..... 01.7461 17.69

340151 ..... 01.2148 15.08 360009 ..... 01.3939 17.80 360086 ..... 01.4480 18.21 360175 ..... 01.2520 18.78 370038 ..... 00.9834 11.67

340153 ..... 01.8980 19.07 360010 ..... 01.1941 16.42 360087 ..... 01.4085 17.90 360176 ..... 01.1680 14.85 370039 ..... 01.4126 14.24

340155 ..... 01.4119 20.03 360011 ..... 01.3105 18.17 360088 ..... 01.2530 16.38 360177 ..... 01.2971 16.97 370040 ..... 01.0732 12.21

340156 ..... 00.8453 .......... 360012 ..... 01.2907 19.29 360089 ..... 01.1458 17.82 360178 ..... 01.1892 16.88 370041 ..... 01.0325 14.17

340158 ..... 01.2122 16.64 360013 ..... 01.1167 17.72 360090 ..... 01.2435 19.06 360179 ..... 01.2990 19.34 370042 ..... 00.8601 12.67

340159 ..... 01.1730 17.58 360014 ..... 01.1749 17.98 360091 ..... 01.2344 19.17 360180 ..... 02.1407 22.61 370043 ..... 00.9385 13.83

340160 ..... 01.1167 13.34 360016 ..... 01.5907 17.92 360092 ..... 01.1738 18.70 360184 ..... 00.4826 16.57 370045 ..... 01.0062 10.45

340162 ..... 01.1881 17.44 360017 ..... 01.8253 20.42 360093 ..... 01.2307 16.69 360185 ..... 01.2327 17.09 370046 ..... 01.0062 11.67

340164 ..... 01.5860 18.61 360018 ..... 01.6307 19.25 360094 ..... 01.3184 19.51 360186 ..... 01.1293 14.23 370047 ..... 01.3674 15.46

340166 ..... 01.3553 19.31 360019 ..... 01.2457 19.11 360095 ..... 01.2967 17.00 360187 ..... 01.3884 16.45 370048 ..... 01.2342 14.10

340168 ..... 00.5173 14.86 360020 ..... 01.4476 19.77 360096 ..... 01.1102 16.11 360188 ..... 00.9743 15.83 370049 ..... 01.3882 15.65

340171 ..... 01.1321 20.34 360021 ..... 01.2174 17.75 360098 ..... 01.3556 17.96 360189 ..... 01.0811 16.02 370051 ..... 00.9683 12.64

340173 ..... 01.2798 .......... 360024 ..... 01.4071 18.60 360099 ..... 01.0454 15.01 360192 ..... 01.3259 20.42 370054 ..... 01.4885 15.15

350001 ..... 01.0123 11.96 360025 ..... 01.2808 18.44 360100 ..... 01.2628 16.54 360193 ..... 01.3581 16.93 370056 ..... 01.5839 18.24

350002 ..... 01.7471 15.76 360026 ..... 01.3129 15.99 360101 ..... 01.5606 19.00 360194 ..... 01.2097 16.98 370057 ..... 01.1540 13.78

350003 ..... 01.1860 16.16 360027 ..... 01.5042 19.53 360102 ..... 01.3166 20.31 360195 ..... 01.1428 18.15 370059 ..... 01.1079 17.59

350004 ..... 01.9396 17.55 360028 ..... 01.4059 16.15 360103 ..... 01.3796 19.64 360197 ..... 01.2406 18.15 370060 ..... 01.0892 12.84

350005 ..... 01.1759 12.94 360029 ..... 01.1959 17.00 360106 ..... 01.0886 14.96 360200 ..... 01.0117 14.16 370063 ..... 01.0280 13.43

350006 ..... 01.4658 15.92 360030 ..... 01.3039 16.35 360107 ..... 01.2908 17.73 360203 ..... 01.1555 15.13 370064 ..... 01.0078 10.63

350007 ..... 00.9387 11.95 360031 ..... 01.3375 18.56 360108 ..... 01.0396 15.34 360204 ..... 01.1930 17.97 370065 ..... 00.9975 15.50

350008 ..... 00.9673 15.65 360032 ..... 01.0924 18.26 360109 ..... 01.0923 17.32 360210 ..... 01.1623 19.78 370071 ..... 01.0650 11.99

350009 ..... 01.2044 15.95 360034 ..... 01.2896 13.90 360112 ..... 01.8045 22.51 360211 ..... 01.2500 18.78 370072 ..... 00.9083 12.83

350010 ..... 01.1975 12.15 360035 ..... 01.5988 20.13 360113 ..... 01.3367 19.20 360212 ..... 01.3950 19.17 370076 ..... 01.2782 12.00

350011 ..... 01.9030 17.35 360036 ..... 01.3855 17.71 360114 ..... 01.0906 17.10 360213 ..... 01.1504 17.17 370077 ..... 01.1968 16.27

350012 ..... 01.2136 11.99 360037 ..... 02.0437 20.51 360115 ..... 01.2874 17.65 360218 ..... 01.3232 16.46 370078 ..... 01.6803 14.49

350013 ..... 01.0734 15.32 360038 ..... 01.5766 18.07 360116 ..... 01.1189 16.64 360230 ..... 01.5121 19.37 370079 ..... 00.9507 12.41

350014 ..... 01.0049 15.46 360039 ..... 01.3052 16.07 360118 ..... 01.3818 18.32 360231 ..... 01.0866 12.11 370080 ..... 00.9633 11.68

350015 ..... 01.6959 15.63 360040 ..... 01.4268 17.31 360121 ..... 01.2342 17.90 360234 ..... 01.3527 18.54 370082 ..... 00.8647 13.46

350016 ..... 01.0278 10.92 360041 ..... 01.3556 18.33 360123 ..... 01.1997 18.37 360236 ..... 01.2897 17.59 370083 ..... 00.9410 11.35

350017 ..... 01.4347 15.24 360042 ..... 01.1551 17.62 360125 ..... 01.0747 17.38 360239 ..... 01.3234 19.51 370084 ..... 01.1272 11.02

350018 ..... 01.0690 11.21 360044 ..... 01.1741 15.64 360126 ..... 01.2090 20.09 360241 ..... 00.5799 18.86 370085 ..... 00.8936 14.52

350019 ..... 01.6318 18.43 360045 ..... 01.5348 20.90 360127 ..... 01.2236 16.48 360242 ..... 01.6800 .......... 370086 ..... 01.1242 07.79

350020 ..... 01.7038 20.24 360046 ..... 01.1457 17.85 360128 ..... 01.2053 14.73 360243 ..... 00.7547 15.52 370089 ..... 01.2565 13.16

350021 ..... 01.0657 11.41 360047 ..... 01.1558 13.65 360129 ..... 01.0204 14.59 360244 ..... 00.6212 15.74 370091 ..... 01.7693 17.18

350023 ..... 00.9056 12.86 360048 ..... 01.7911 21.55 360130 ..... 01.1377 15.59 360245 ..... 00.7563 14.33 370092 ..... 01.0486 14.38

350024 ..... 01.0901 15.40 360049 ..... 01.2049 18.18 360131 ..... 01.3624 17.38 360247 ..... 00.4249 .......... 370093 ..... 01.8714 18.71

350025 ..... 01.0197 13.34 360050 ..... 01.1543 12.37 360132 ..... 01.3101 18.78 360248 ..... 01.7716 .......... 370094 ..... 01.4088 17.00

350027 ..... 00.9438 12.32 360051 ..... 01.6080 21.90 360133 ..... 01.4858 18.44 370001 ..... 01.7032 18.73 370095 ..... 00.9450 11.66

350029 ..... 00.8818 13.02 360052 ..... 01.7565 18.41 360134 ..... 01.7139 19.43 370002 ..... 01.2588 13.98 370097 ..... 01.4520 18.02

350030 ..... 00.9794 15.93 360054 ..... 01.2912 15.83 360135 ..... 01.1809 16.82 370004 ..... 01.3080 15.35 370099 ..... 01.1924 12.65

350033 ..... 00.9672 14.33 360055 ..... 01.2726 19.12 360136 ..... 01.0773 15.96 370005 ..... 01.0106 13.12 370100 ..... 00.9622 13.45

350034 ..... 00.9622 18.05 360056 ..... 01.4296 16.47 360137 ..... 01.6206 18.82 370006 ..... 01.2229 15.45 370103 ..... 00.9375 15.07

350035 ..... 00.8570 09.95 360057 ..... 01.1168 13.87 360140 ..... 01.0258 16.19 370007 ..... 01.2061 13.82 370105 ..... 01.9923 16.23

350038 ..... 01.0479 14.07 360058 ..... 01.3461 16.66 360141 ..... 01.4692 21.06 370008 ..... 01.4030 16.68 370106 ..... 01.5356 16.46

350039 ..... 01.0484 13.84 360059 ..... 01.5754 20.39 360142 ..... 00.9969 15.98 370011 ..... 01.0547 12.95 370108 ..... 01.0528 11.73
Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations 46065

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370112 ..... 01.0771 13.21 380029 ..... 01.1586 18.45 390032 ..... 01.2762 18.10 390115 ..... 01.3809 22.31 390205 ..... 01.4138 20.63

370113 ..... 01.2416 16.23 380031 ..... 01.0219 18.48 390035 ..... 01.2570 17.79 390116 ..... 01.2586 21.78 390206 ..... 01.4057 20.14

370114 ..... 01.6787 15.49 380033 ..... 01.7402 24.13 390036 ..... 01.4202 18.06 390117 ..... 01.1972 15.62 390209 ..... 01.0481 15.09

370121 ..... 01.1451 17.38 380035 ..... 01.3725 19.01 390037 ..... 01.3360 18.93 390118 ..... 01.2115 16.26 390211 ..... 01.2749 16.99

370122 ..... 01.1357 07.58 380036 ..... 01.0566 20.26 390039 ..... 01.1244 15.66 390119 ..... 01.3748 17.59 390213 ..... 01.0016 16.41

370123 ..... 01.2119 12.32 380037 ..... 01.1645 19.53 390040 ..... 00.9686 13.13 390121 ..... 01.3448 17.47 390215 ..... 01.2812 21.06

370125 ..... 01.0097 13.37 380038 ..... 01.3393 22.64 390041 ..... 01.3187 17.07 390122 ..... 01.0693 17.57 390217 ..... 01.2357 18.51

370126 ..... 00.9543 15.34 380039 ..... 01.3779 29.30 390042 ..... 01.5624 21.73 390123 ..... 01.3537 20.71 390219 ..... 01.3287 19.67

370131 ..... 01.0012 12.88 380040 ..... 01.2637 19.96 390043 ..... 01.1719 14.85 390125 ..... 01.2284 15.61 390220 ..... 01.1983 19.08

370133 ..... 01.1472 10.09 380042 ..... 01.1612 20.57 390044 ..... 01.6556 19.63 390126 ..... 01.2945 21.03 390222 ..... 01.3122 20.33

370138 ..... 01.1325 15.23 380047 ..... 01.7067 22.12 390045 ..... 01.7661 18.05 390127 ..... 01.2538 20.96 390223 ..... 01.5528 23.17

370139 ..... 01.1354 12.56 380048 ..... 01.0410 14.68 390046 ..... 01.6117 19.79 390128 ..... 01.2119 18.14 390224 ..... 00.9223 13.35

370140 ..... 00.9528 10.99 380050 ..... 01.3901 17.45 390047 ..... 01.7852 28.26 390130 ..... 01.1560 17.20 390225 ..... 01.2083 17.19

370141 ..... 01.3715 17.30 380051 ..... 01.5648 20.05 390048 ..... 01.1647 16.60 390131 ..... 01.2907 16.30 390226 ..... 01.7768 24.15

370146 ..... 01.0085 10.73 380052 ..... 01.1918 16.61 390049 ..... 01.6474 20.69 390132 ..... 01.3448 15.42 390228 ..... 01.2582 19.38

370148 ..... 01.5151 18.46 380055 ..... 01.1757 24.14 390050 ..... 02.1314 22.39 390133 ..... 01.8281 21.71 390231 ..... 01.3348 25.11

370149 ..... 01.2706 15.35 380056 ..... 01.0666 17.36 390051 ..... 02.2272 25.28 390135 ..... 01.3066 21.05 390233 ..... 01.3161 17.22

370153 ..... 01.1557 14.05 380060 ..... 01.4373 21.98 390052 ..... 01.2179 19.41 390136 ..... 01.1980 15.39 390235 ..... 01.6702 24.38

370154 ..... 00.9897 13.05 380061 ..... 01.5351 22.07 390054 ..... 01.2347 16.08 390137 ..... 01.5015 16.35 390236 ..... 01.2217 15.88

370156 ..... 01.0800 12.49 380062 ..... 01.1543 14.40 390055 ..... 01.8450 21.81 390138 ..... 01.3173 17.93 390237 ..... 01.5935 20.36

370158 ..... 00.9865 11.75 380063 ..... 01.2864 19.01 390056 ..... 01.1639 16.81 390139 ..... 01.5607 23.54 390238 ..... 01.4213 16.51

370159 ..... 01.2594 15.59 380064 ..... 01.3688 21.25 390057 ..... 01.2716 18.70 390142 ..... 01.6526 23.18 390242 ..... 01.2889 18.48

370163 ..... 00.8591 12.16 380065 ..... 01.0800 22.49 390058 ..... 01.3370 18.67 390145 ..... 01.3905 19.48 390244 ..... 00.8920 09.83

370165 ..... 01.2006 12.46 380066 ..... 01.4293 18.58 390060 ..... 01.1510 16.92 390146 ..... 01.2882 16.44 390245 ..... 01.3803 24.05

370166 ..... 01.1406 16.32 380068 ..... 01.0516 19.05 390061 ..... 01.4893 19.08 390147 ..... 01.2376 19.08 390246 ..... 01.2473 17.25

370169 ..... 01.1037 11.25 380069 ..... 01.1438 18.59 390062 ..... 01.2096 16.01 390150 ..... 01.1109 18.10 390247 ..... 01.0371 18.26

370170 ..... 01.0855 . 380070 ..... 01.3961 21.24 390063 ..... 01.7640 19.24 390151 ..... 01.2813 18.58 390249 ..... 00.9800 12.06

370171 ..... 01.0678 .......... 380071 ..... 01.3440 20.07 390065 ..... 01.2780 19.30 390152 ..... 01.0750 18.81 390256 ..... 01.8586 23.45

370172 ..... 00.9962 .......... 380072 ..... 00.9537 14.66 390066 ..... 01.3186 17.77 390153 ..... 01.2419 22.46 390258 ..... 01.2671 20.08

370173 ..... 01.1933 .......... 380075 ..... 01.4047 19.72 390067 ..... 01.7794 18.91 390154 ..... 01.2332 16.67 390260 ..... 01.2216 21.17

370174 ..... 01.1211 .......... 380078 ..... 01.1150 17.41 390068 ..... 01.2742 17.23 390155 ..... 01.2835 19.44 390262 ..... 02.1059 17.77

370176 ..... 01.1972 15.29 380081 ..... 01.0847 18.84 390069 ..... 01.2051 17.75 390156 ..... 01.4396 21.37 390263 ..... 01.4786 19.16

370177 ..... 01.0146 10.09 380082 ..... 01.3405 22.96 390070 ..... 01.2858 20.39 390157 ..... 01.3451 17.99 390265 ..... 01.2976 18.82

370178 ..... 01.0055 10.96 380083 ..... 01.2349 20.06 390071 ..... 01.1351 13.68 390158 ..... 01.5819 18.96 390266 ..... 01.1930 16.81

370179 ..... 00.8169 17.33 380084 ..... 01.3216 21.43 390072 ..... 01.0913 15.91 390160 ..... 01.2468 18.50 390267 ..... 01.2771 19.80

370180 ..... 00.9740 .......... 380087 ..... 01.0052 15.38 390073 ..... 01.6266 19.03 390161 ..... 01.1266 14.43 390268 ..... 01.3964 20.44

370183 ..... 01.0165 12.06 380088 ..... 01.0315 16.16 390074 ..... 01.3127 16.05 390162 ..... 01.4556 19.59 390270 ..... 01.3202 16.67

370186 ..... 01.0206 13.15 380089 ..... 01.3738 22.25 390075 ..... 01.3025 16.41 390163 ..... 01.2420 15.99 390272 ..... 00.5074 ..........

370189 ..... 00.9532 07.82 380090 ..... 01.3211 25.71 390076 ..... 01.3566 21.07 390164 ..... 02.1542 20.37 390277 ..... 00.4880 22.55

370190 ..... 01.5794 15.31 380091 ..... 01.2631 25.13 390078 ..... 01.0424 16.88 390166 ..... 01.1022 18.31 390278 ..... 00.6661 18.42

370192 ..... 01.3093 17.57 390001 ..... 01.3373 18.25 390079 ..... 01.7564 16.81 390167 ..... 01.3544 21.30 390279 ..... 01.0584 15.32

370194 ..... 01.8180 .......... 390002 ..... 01.3644 18.62 390080 ..... 01.3323 19.14 390168 ..... 01.2625 18.43 390281 ..... 02.6697 ..........

370195 ..... 01.7401 .......... 390003 ..... 01.2554 15.88 390081 ..... 01.3776 22.88 390169 ..... 01.2856 18.72 390282 ..... 02.9409 ..........

370196 ..... 01.1671 .......... 390004 ..... 01.4319 18.12 390083 ..... 01.1662 22.01 390170 ..... 01.9087 21.25 400001 ..... 01.3065 08.65

370197 ..... 01.0898 .......... 390005 ..... 01.0806 14.24 390084 ..... 01.1944 15.57 390173 ..... 01.1949 16.79 400002 ..... 01.6129 11.34

380001 ..... 01.3616 21.21 390006 ..... 01.7592 18.17 390086 ..... 01.2005 15.86 390174 ..... 01.7675 25.41 400003 ..... 01.2768 08.61

380002 ..... 01.1954 19.35 390007 ..... 01.1638 21.90 390088 ..... 01.3124 22.62 390176 ..... 01.1748 18.14 400004 ..... 01.1628 08.18

380003 ..... 01.2096 20.71 390008 ..... 01.1579 15.47 390090 ..... 01.8633 18.97 390178 ..... 01.2993 18.44 400005 ..... 01.0828 06.61

380004 ..... 01.7682 23.34 390009 ..... 01.6174 17.81 390091 ..... 01.1348 17.40 390179 ..... 01.3019 22.12 400006 ..... 01.1998 07.59

380005 ..... 01.2457 21.15 390010 ..... 01.1940 17.10 390093 ..... 01.1530 14.99 390180 ..... 01.5552 23.40 400007 ..... 01.2160 07.46

380006 ..... 01.3673 19.26 390011 ..... 01.2706 16.82 390095 ..... 01.1941 14.46 390181 ..... 01.0669 18.59 400009 ..... 01.0124 07.71

380007 ..... 01.5837 23.43 390012 ..... 01.2607 19.75 390096 ..... 01.3470 17.00 390183 ..... 01.2194 18.03 400010 ..... 00.9370 08.53

380008 ..... 01.0565 17.83 390013 ..... 01.2410 16.90 390097 ..... 01.3270 21.56 390184 ..... 01.1453 18.07 400011 ..... 00.9932 08.12

380009 ..... 01.8640 23.30 390015 ..... 01.1668 13.12 390098 ..... 01.7998 20.75 390185 ..... 01.2099 16.34 400012 ..... 01.2679 07.40

380010 ..... 01.1177 20.67 390016 ..... 01.2448 16.40 390100 ..... 01.6693 20.03 390189 ..... 01.0930 16.73 400013 ..... 01.2504 07.44

380011 ..... 01.0880 20.97 390017 ..... 01.1347 15.43 390101 ..... 01.2430 16.62 390191 ..... 01.1775 14.33 400014 ..... 01.3895 08.92

380013 ..... 01.2741 17.76 390018 ..... 01.3507 20.05 390102 ..... 01.3992 20.51 390192 ..... 01.1868 16.36 400015 ..... 01.2239 09.83

380014 ..... 01.5560 20.77 390019 ..... 01.1182 15.59 390103 ..... 01.1030 18.00 390193 ..... 01.2146 16.13 400016 ..... 01.3497 10.89

380017 ..... 01.8253 23.17 390022 ..... 01.3276 21.40 390104 ..... 01.0899 14.99 390194 ..... 01.1010 18.91 400017 ..... 01.2425 07.70

380018 ..... 01.7644 21.22 390023 ..... 01.3010 18.98 390106 ..... 01.0768 15.15 390195 ..... 01.8873 22.93 400018 ..... 01.2993 09.67

380019 ..... 01.3170 19.33 390024 ..... 00.9898 23.26 390107 ..... 01.2972 19.04 390196 ..... 01.4406 .......... 400019 ..... 01.8030 09.34

380020 ..... 01.4406 21.43 390025 ..... 00.6308 15.97 390108 ..... 01.3512 20.08 390197 ..... 01.3014 18.49 400021 ..... 01.4988 08.78

380021 ..... 01.2983 19.44 390026 ..... 01.2830 20.94 390109 ..... 01.1606 14.14 390198 ..... 01.2247 15.75 400022 ..... 01.3222 10.01

380022 ..... 01.2344 21.01 390027 ..... 01.8940 25.88 390110 ..... 01.5989 18.05 390199 ..... 01.3118 15.40 400024 ..... 00.9975 07.79

380023 ..... 01.2476 17.43 390028 ..... 01.9133 17.78 390111 ..... 01.8414 27.88 390200 ..... 01.0929 14.88 400026 ..... 00.9746 05.66

380025 ..... 01.2534 22.55 390029 ..... 01.9558 18.83 390112 ..... 01.1966 12.26 390201 ..... 01.2589 19.26 400027 ..... 01.1943 09.06

380026 ..... 01.1657 17.54 390030 ..... 01.2417 17.37 390113 ..... 01.2118 16.25 390203 ..... 01.3873 20.96 400028 ..... 01.0387 07.89

380027 ..... 01.3334 23.09 390031 ..... 01.1640 17.15 390114 ..... 01.2644 22.27 390204 ..... 01.2800 18.56 400029 ..... 01.1383 ..........
46066 Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations

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400031 ..... 01.1913 08.38 420053 ..... 01.2774 14.99 430056 ..... 00.8741 09.56 440068 ..... 01.2254 17.28 440205 ..... 01.1096 15.47

400032 ..... 01.1933 08.21 420054 ..... 01.2603 17.08 430057 ..... 00.9229 10.73 440070 ..... 01.1011 14.28 440206 ..... 01.0829 13.80

400044 ..... 01.2118 09.14 420055 ..... 01.0222 14.59 430060 ..... 00.9262 08.64 440071 ..... 01.3979 16.32 440208 ..... 01.9916 ..........

400048 ..... 01.2251 .......... 420056 ..... 01.1518 13.66 430062 ..... 00.8090 10.50 440072 ..... 01.4186 14.81 440209 ..... 01.7802 ..........

400061 ..... 01.5945 13.14 420057 ..... 01.1676 15.20 430064 ..... 01.1664 12.48 440073 ..... 01.3463 18.39 440211 ..... 00.7914 ..........

400079 ..... 01.2989 08.37 420059 ..... 00.9864 13.80 430065 ..... 01.0035 10.34 440078 ..... 01.0317 13.14 450002 ..... 01.5261 18.75

400087 ..... 01.4162 08.10 420061 ..... 01.1701 16.99 430066 ..... 00.9891 11.87 440081 ..... 01.1820 15.86 450004 ..... 01.2254 12.21

400094 ..... 01.1058 09.07 420062 ..... 01.3804 16.51 430073 ..... 01.0158 13.25 440082 ..... 02.0430 21.47 450005 ..... 01.2221 14.82

400098 ..... 01.2338 07.55 420064 ..... 01.1545 14.32 430076 ..... 00.9849 10.30 440083 ..... 01.1480 12.16 450007 ..... 01.2626 13.51

400102 ..... 01.2188 07.59 420065 ..... 01.3538 17.37 430077 ..... 01.6495 16.77 440084 ..... 01.1833 12.89 450008 ..... 01.3661 14.74

400103 ..... 01.4253 09.13 420066 ..... 00.9250 15.38 430079 ..... 00.9968 11.63 440090 ..... 00.8532 11.62 450010 ..... 01.4024 15.12

400104 ..... 01.4137 09.01 420067 ..... 01.2687 16.48 430081 ..... 00.9338 .......... 440091 ..... 01.6477 16.91 450011 ..... 01.5959 17.67

400105 ..... 01.3250 09.05 420068 ..... 01.3430 17.25 430082 ..... 00.9221 .......... 440100 ..... 01.0678 13.60 450014 ..... 01.0411 14.53

400106 ..... 01.2027 07.87 420069 ..... 01.0606 14.29 430083 ..... 00.7736 .......... 440102 ..... 01.0777 12.64 450015 ..... 01.5299 15.25

400109 ..... 01.4914 09.67 420070 ..... 01.2890 15.76 430084 ..... 00.9792 .......... 440103 ..... 01.2605 16.57 450016 ..... 01.6408 17.49

400110 ..... 01.1463 08.39 420071 ..... 01.3340 17.29 430085 ..... 00.9069 .......... 440104 ..... 01.6987 18.53 450018 ..... 01.5929 21.98

400111 ..... 01.1311 08.52 420072 ..... 01.0354 11.94 430087 ..... 00.9333 08.64 440105 ..... 01.0989 16.52 450020 ..... 01.0246 16.23

400112 ..... 01.2492 08.03 420073 ..... 01.3185 18.17 430089 ..... 00.8346 .......... 440109 ..... 01.1123 12.71 450021 ..... 01.8352 21.68

400113 ..... 01.2692 07.41 420074 ..... 00.9857 11.49 440001 ..... 01.1456 12.99 440110 ..... 00.9587 16.41 450023 ..... 01.4560 16.45

400114 ..... 01.0613 07.55 420075 ..... 00.9638 14.51 440002 ..... 01.6285 16.75 440111 ..... 01.4009 18.75 450024 ..... 01.3308 16.74

400115 ..... 01.0254 07.86 420078 ..... 01.8003 19.92 440003 ..... 01.1383 15.46 440114 ..... 01.0824 12.28 450025 ..... 01.5918 15.72

400117 ..... 01.1717 09.01 420079 ..... 01.5954 18.15 440006 ..... 01.4804 18.40 440115 ..... 01.0713 15.34 450028 ..... 01.5626 18.19

400118 ..... 01.2078 09.52 420080 ..... 01.3386 21.29 440007 ..... 00.9713 11.94 440120 ..... 01.5429 18.26 450029 ..... 01.4570 14.12

400120 ..... 01.3175 09.23 420081 ..... 01.2360 19.59 440008 ..... 01.0206 12.34 440125 ..... 01.4791 18.20 450031 ..... 01.5193 19.54

400121 ..... 01.0939 06.53 420082 ..... 01.4171 19.00 440009 ..... 01.2679 14.38 440130 ..... 01.2138 13.33 450032 ..... 01.2471 12.89

400122 ..... 01.0230 06.66 420083 ..... 01.2856 17.31 440010 ..... 00.9448 10.15 440131 ..... 01.1302 13.71 450033 ..... 01.6126 17.70

400123 ..... 01.1446 09.36 420085 ..... 01.5083 17.52 440011 ..... 01.3301 16.51 440132 ..... 01.1419 14.75 450034 ..... 01.7095 18.08

400124 ..... 02.3583 11.31 420086 ..... 01.3750 16.96 440012 ..... 01.5155 18.04 440133 ..... 01.5684 18.67 450035 ..... 01.5326 19.16

410001 ..... 01.3371 22.95 420087 ..... 01.6990 16.86 440014 ..... 01.1200 09.84 440135 ..... 01.2866 17.25 450037 ..... 01.6270 18.03

410004 ..... 01.3139 21.15 420088 ..... 01.1999 15.27 440015 ..... 01.7323 18.12 440137 ..... 01.0171 13.14 450039 ..... 01.3288 17.37

410005 ..... 01.3535 22.61 420089 ..... 01.2336 20.60 440016 ..... 00.9970 12.59 440141 ..... 01.0474 14.12 450040 ..... 01.5635 17.73

410006 ..... 01.3134 20.75 420091 ..... 01.2895 18.32 440017 ..... 01.6425 20.72 440142 ..... 01.0235 11.05 450042 ..... 01.7513 15.78

410007 ..... 01.7033 21.60 420093 ..... 01.0290 .......... 440018 ..... 01.4087 17.06 440143 ..... 01.1029 16.45 450044 ..... 01.6323 19.72

410008 ..... 01.2207 21.52 420094 ..... 01.0142 .......... 440019 ..... 01.7245 17.21 440144 ..... 01.2377 18.01 450046 ..... 01.3332 15.81

410009 ..... 01.3152 21.03 430004 ..... 01.1098 15.06 440020 ..... 01.2198 15.78 440145 ..... 00.9917 14.42 450047 ..... 01.1063 13.46

410010 ..... 01.0663 25.32 430005 ..... 01.3635 14.44 440022 ..... 01.1220 14.01 440147 ..... 01.5380 23.56 450050 ..... 01.0051 14.35

410011 ..... 01.2322 23.54 430007 ..... 01.0876 12.77 440023 ..... 01.0845 13.04 440148 ..... 01.1478 15.54 450051 ..... 01.6238 18.53

410012 ..... 01.8243 20.26 430008 ..... 01.1139 13.56 440024 ..... 01.3163 16.88 440149 ..... 01.1533 15.28 450052 ..... 01.0402 13.01

410013 ..... 01.3321 27.36 430010 ..... 01.1619 11.70 440025 ..... 01.1310 13.54 440150 ..... 01.2975 19.97 450053 ..... 01.0950 13.82

420002 ..... 01.3781 20.19 430011 ..... 01.2805 14.49 440029 ..... 01.2898 16.88 440151 ..... 01.3044 16.20 450054 ..... 01.6713 21.71

420004 ..... 01.8270 18.16 430012 ..... 01.2848 15.08 440030 ..... 01.2286 12.15 440152 ..... 01.8133 17.68 450055 ..... 01.1386 13.89

420005 ..... 01.2076 14.51 430013 ..... 01.2924 15.39 440031 ..... 01.0158 13.14 440153 ..... 01.2942 15.19 450056 ..... 01.6924 17.92

420006 ..... 01.1694 17.19 430014 ..... 01.3101 17.03 440032 ..... 01.0561 14.47 440156 ..... 01.5826 19.18 450058 ..... 01.5836 16.46

420007 ..... 01.4966 16.92 430015 ..... 01.2209 15.17 440033 ..... 01.1140 14.61 440157 ..... 01.0397 13.83 450059 ..... 01.2884 13.85

420009 ..... 01.2382 16.92 430016 ..... 01.8665 17.78 440034 ..... 01.5576 17.68 440159 ..... 01.3156 14.02 450063 ..... 00.9369 10.66

420010 ..... 01.1211 15.13 430018 ..... 00.9509 13.13 440035 ..... 01.3309 16.53 440161 ..... 01.8754 20.06 450064 ..... 01.4910 15.57

420011 ..... 01.1251 15.28 430022 ..... 00.9348 11.95 440039 ..... 01.6969 17.44 440166 ..... 01.5786 18.25 450065 ..... 01.1163 14.73

420014 ..... 01.0959 14.36 430023 ..... 00.9495 10.34 440040 ..... 01.0122 10.81 440168 ..... 01.0442 12.43 450068 ..... 01.8865 21.36

420015 ..... 01.3676 16.84 430024 ..... 00.9521 12.07 440041 ..... 01.0586 12.23 440173 ..... 01.5485 17.50 450072 ..... 01.2275 18.67

420016 ..... 01.0741 14.21 430026 ..... 01.0086 11.24 440046 ..... 01.2850 15.30 440174 ..... 01.0180 12.74 450073 ..... 01.1003 12.06

420018 ..... 01.8145 20.00 430027 ..... 01.7854 17.63 440047 ..... 00.9397 14.52 440175 ..... 01.1775 18.60 450076 ..... 01.6678 ..........

420019 ..... 01.1995 14.70 430028 ..... 01.1346 13.29 440048 ..... 01.8500 17.82 440176 ..... 01.4502 19.17 450078 ..... 00.9703 11.75

420020 ..... 01.3498 16.94 430029 ..... 00.9654 13.84 440049 ..... 01.6746 16.37 440178 ..... 01.2514 17.07 450079 ..... 01.4563 21.93

420023 ..... 01.4485 18.50 430031 ..... 00.9226 11.58 440050 ..... 01.3461 16.28 440180 ..... 01.2307 16.96 450080 ..... 01.2802 15.99

420026 ..... 01.8750 18.16 430033 ..... 01.0529 13.10 440051 ..... 00.9678 13.82 440181 ..... 01.0352 12.37 450081 ..... 01.0888 14.50

420027 ..... 01.3572 16.82 430034 ..... 01.1129 11.59 440052 ..... 01.1948 14.76 440182 ..... 01.0190 12.53 450082 ..... 01.0035 14.70

420030 ..... 01.2764 17.28 430036 ..... 01.0216 11.83 440053 ..... 01.3459 16.28 440183 ..... 01.5114 19.69 450083 ..... 01.7818 19.58

420031 ..... 00.9784 11.88 430037 ..... 00.9883 13.15 440054 ..... 01.2016 14.55 440184 ..... 01.3997 18.96 450085 ..... 01.0862 17.24

420033 ..... 01.1614 18.91 430038 ..... 01.0476 10.83 440056 ..... 01.1017 13.57 440185 ..... 01.2202 17.48 450087 ..... 01.4647 19.68

420036 ..... 01.3499 16.42 430040 ..... 01.0233 12.64 440057 ..... 01.0237 12.15 440186 ..... 01.0746 15.77 450090 ..... 01.2180 13.26

420037 ..... 01.2802 20.66 430041 ..... 00.9677 12.47 440058 ..... 01.2495 16.30 440187 ..... 01.1420 14.58 450092 ..... 01.2103 14.59

420038 ..... 01.2725 14.80 430043 ..... 01.2163 11.82 440059 ..... 01.3842 14.85 440189 ..... 01.5092 19.13 450094 ..... 01.3336 17.87

420039 ..... 01.1654 15.64 430044 ..... 00.8361 14.07 440060 ..... 01.3027 14.20 440192 ..... 01.1999 15.37 450096 ..... 01.5711 17.19

420042 ..... 01.1386 14.05 430047 ..... 01.0845 11.92 440061 ..... 01.1956 15.89 440193 ..... 01.2971 18.60 450097 ..... 01.4826 18.51

420043 ..... 01.2699 19.12 430048 ..... 01.2958 15.48 440063 ..... 01.6377 17.90 440194 ..... 01.2212 17.13 450098 ..... 01.1761 15.10

420048 ..... 01.1477 15.56 430049 ..... 00.9275 12.70 440064 ..... 01.1174 14.56 440197 ..... 01.3749 19.23 450099 ..... 01.3103 14.66

420049 ..... 01.2069 15.89 430051 ..... 00.9280 13.84 440065 ..... 01.2888 17.78 440200 ..... 01.0979 15.64 450101 ..... 01.4893 15.44

420051 ..... 01.6352 18.06 430054 ..... 01.0393 12.79 440067 ..... 01.2835 14.99 440203 ..... 00.9109 13.09 450102 ..... 01.7046 17.87
Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations 46067

PAGE 14 OF 16

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450104 ..... 01.2431 14.23 450219 ..... 01.1560 14.78 450379 ..... 01.5227 21.62 450591 ..... 01.1493 18.92 450713 ..... 01.4979 20.85

450107 ..... 01.6232 22.05 450221 ..... 01.1643 14.40 450381 ..... 00.9920 12.86 450596 ..... 01.3891 17.15 450715 ..... 01.3738 18.59

450108 ..... 00.9827 12.48 450222 ..... 01.6034 18.35 450388 ..... 01.8109 17.12 450597 ..... 01.0350 14.53 450716 ..... 01.2943 19.56

450109 ..... 00.9150 14.72 450224 ..... 01.3620 20.66 450389 ..... 01.3265 17.71 450603 ..... 00.7116 16.81 450717 ..... 01.2538 23.86

450110 ..... 01.2792 19.30 450229 ..... 01.5626 15.41 450393 ..... 01.3164 19.70 450604 ..... 01.4372 14.00 450718 ..... 01.2333 19.03

450111 ..... 01.2174 18.93 450231 ..... 01.6412 18.25 450395 ..... 01.0473 16.49 450605 ..... 01.3880 17.67 450723 ..... 01.3871 18.22

450112 ..... 01.3183 14.31 450234 ..... 00.9989 13.07 450399 ..... 01.0599 15.59 450609 ..... 00.9188 11.77 450724 ..... 01.3696 17.44

450113 ..... 01.3022 17.93 450235 ..... 01.0302 13.46 450400 ..... 01.1885 11.76 450610 ..... 01.5475 17.21 450725 ..... 00.9390 17.49

450118 ..... 01.5826 20.36 450236 ..... 01.2206 15.28 450403 ..... 01.3015 21.22 450614 ..... 01.0086 12.53 450727 ..... 01.1724 10.80

450119 ..... 01.3813 17.13 450237 ..... 01.6258 16.83 450411 ..... 00.9144 12.20 450615 ..... 01.0918 12.80 450728 ..... 00.9311 12.62

450121 ..... 01.5556 19.99 450239 ..... 01.0605 13.70 450417 ..... 01.0947 19.31 450617 ..... 01.3521 20.12 450730 ..... 01.3241 21.46

450123 ..... 01.0933 15.98 450241 ..... 00.9279 12.67 450418 ..... 01.4996 21.43 450620 ..... 01.1348 12.16 450733 ..... 01.3628 16.88

450124 ..... 01.7210 19.68 450243 ..... 00.7767 11.59 450419 ..... 01.2762 20.34 450623 ..... 01.1891 16.71 450735 ..... 01.0637 12.02

450126 ..... 01.3625 16.01 450246 ..... 00.9464 17.09 450422 ..... 00.8249 24.65 450626 ..... 01.0634 16.57 450742 ..... 01.2932 19.47

450128 ..... 01.1955 15.37 450249 ..... 00.9676 09.95 450423 ..... 01.5850 21.56 450628 ..... 00.9320 12.34 450743 ..... 01.4228 17.79

450130 ..... 01.4846 16.93 450250 ..... 00.9480 11.36 450424 ..... 01.2492 17.77 450630 ..... 01.6658 23.25 450746 ..... 01.0195 13.81

450131 ..... 01.4057 18.24 450253 ..... 01.3024 11.92 450429 ..... 01.1208 12.87 450631 ..... 01.7515 20.15 450747 ..... 01.3610 17.04

450132 ..... 01.7205 16.46 450258 ..... 01.1072 10.85 450431 ..... 01.6315 18.76 450632 ..... 00.9769 11.39 450749 ..... 01.0118 14.63

450133 ..... 01.6057 17.90 450259 ..... 01.1636 18.29 450438 ..... 01.2603 13.51 450633 ..... 01.6399 20.20 450750 ..... 01.0231 12.20

450135 ..... 01.6757 23.54 450264 ..... 00.8806 13.08 450446 ..... 00.6453 12.67 450634 ..... 01.6147 23.56 450751 ..... 01.3418 15.58

450137 ..... 01.4998 22.19 450269 ..... 01.0765 13.96 450447 ..... 01.3882 18.07 450638 ..... 01.5883 22.00 450754 ..... 00.9546 13.49

450140 ..... 00.9941 17.44 450270 ..... 01.2477 10.42 450451 ..... 01.1574 16.96 450639 ..... 01.4387 22.12 450755 ..... 01.1688 15.54

450142 ..... 01.4544 20.28 450271 ..... 01.2655 14.84 450457 ..... 01.7817 17.61 450641 ..... 01.0408 13.24 450757 ..... 00.9466 13.62

450143 ..... 01.0340 11.10 450272 ..... 01.3466 15.38 450460 ..... 01.0539 12.46 450643 ..... 01.2270 17.43 450758 ..... 02.0193 21.92

450144 ..... 01.0933 15.29 450276 ..... 01.0101 12.63 450462 ..... 01.7722 20.49 450644 ..... 01.5090 19.07 450760 ..... 01.2573 18.35

450145 ..... 00.8163 13.36 450278 ..... 00.9870 13.64 450464 ..... 01.0035 15.14 450646 ..... 01.6539 31.36 450761 ..... 01.1320 09.57

450146 ..... 00.9883 20.32 450280 ..... 01.5303 23.09 450465 ..... 01.3391 17.10 450647 ..... 01.9577 23.27 450763 ..... 01.0156 16.60

450147 ..... 01.4189 17.72 450283 ..... 01.1089 12.43 450467 ..... 00.9711 14.01 450648 ..... 00.9835 09.48 450766 ..... 02.0719 20.76

450148 ..... 01.2604 20.21 450286 ..... 01.0057 16.36 450469 ..... 01.3759 17.25 450649 ..... 01.0406 14.06 450769 ..... 00.9957 13.40

450149 ..... 01.4207 19.76 450288 ..... 01.2705 13.67 450473 ..... 00.9937 15.03 450651 ..... 01.7505 22.80 450770 ..... 01.0417 14.57

450150 ..... 00.9250 13.75 450289 ..... 01.4339 19.14 450475 ..... 01.1405 14.96 450652 ..... 00.8637 13.96 450771 ..... 01.7803 22.32

450151 ..... 01.1248 14.16 450292 ..... 01.2470 21.03 450484 ..... 01.4469 18.14 450653 ..... 01.2233 15.20 450774 ..... 01.0767 21.24

450152 ..... 01.2600 15.74 450293 ..... 00.9767 12.41 450488 ..... 01.3234 16.08 450654 ..... 00.9499 12.28 450775 ..... 01.2796 17.09

450153 ..... 01.6196 18.44 450296 ..... 01.3759 18.76 450489 ..... 01.0173 12.72 450656 ..... 01.5367 17.19 450776 ..... 00.9194 11.18

450154 ..... 01.1960 13.12 450299 ..... 01.3431 16.01 450497 ..... 01.1693 12.88 450658 ..... 00.9719 12.32 450777 ..... 01.0464 16.60

450155 ..... 01.0291 14.09 450303 ..... 00.9927 11.50 450498 ..... 01.0512 13.15 450659 ..... 01.5366 20.23 450779 ..... 01.2621 21.36

450157 ..... 00.9708 13.25 450306 ..... 01.2219 12.82 450508 ..... 01.4218 16.12 450661 ..... 01.2306 18.51 450780 ..... 01.4049 16.91

450160 ..... 00.9428 21.47 450307 ..... 00.7803 14.25 450514 ..... 01.1886 18.47 450662 ..... 01.6164 17.38 450781 ..... 01.5749 11.01

450162 ..... 01.2530 18.76 450309 ..... 01.0613 14.17 450517 ..... 00.9025 11.11 450665 ..... 00.9129 12.95 450785 ..... 01.0228 16.39

450163 ..... 01.1402 16.82 450315 ..... 01.0420 18.63 450518 ..... 01.5700 16.38 450666 ..... 01.3361 19.17 450788 ..... 01.4500 19.31

450164 ..... 01.1323 12.83 450320 ..... 01.3553 18.45 450523 ..... 01.5823 19.45 450668 ..... 01.5988 19.60 450794 ..... 01.4278 16.20

450165 ..... 01.0215 14.19 450321 ..... 01.0170 13.51 450530 ..... 01.3726 14.27 450669 ..... 01.3407 19.26 450795 ..... 00.8686 20.22

450166 ..... 01.0279 13.06 450322 ..... 00.8184 16.61 450534 ..... 01.0374 18.02 450670 ..... 01.3131 17.24 450797 ..... 00.7374 16.67

450169 ..... 01.0085 13.79 450324 ..... 01.7039 15.66 450535 ..... 01.2951 21.25 450672 ..... 01.6229 20.69 450798 ..... 00.8393 08.88

450170 ..... 00.9944 12.46 450325 ..... 00.9022 11.47 450537 ..... 01.3071 19.69 450673 ..... 01.0518 12.14 450801 ..... 01.4832 ..........

450176 ..... 01.2956 15.32 450327 ..... 01.0130 12.60 450538 ..... 01.2091 20.77 450674 ..... 00.9801 19.88 450802 ..... 01.2272 ..........

450177 ..... 01.2760 13.52 450330 ..... 01.1514 15.62 450539 ..... 01.4094 14.67 450675 ..... 01.5223 20.99 450803 ..... 00.8612 ..........

450178 ..... 01.0251 15.84 450334 ..... 01.0501 12.11 450544 ..... 01.3519 19.25 450677 ..... 01.4273 23.91 450804 ..... 01.5602 ..........

450181 ..... 01.0644 14.13 450337 ..... 01.1588 14.10 450545 ..... 01.2665 20.93 450678 ..... 01.5041 20.85 450807 ..... 00.9215 ..........

450184 ..... 01.5239 17.20 450340 ..... 01.3279 14.68 450547 ..... 01.1549 15.13 450683 ..... 01.3412 20.91 450808 ..... 01.2870 ..........

450185 ..... 01.0771 08.69 450341 ..... 01.0487 15.87 450550 ..... 01.0679 18.37 450684 ..... 01.3022 21.41 450809 ..... 01.6785 ..........

450187 ..... 01.2404 16.51 450346 ..... 01.4354 16.05 450551 ..... 01.2276 13.01 450686 ..... 01.6066 14.14 450810 ..... 01.1663 ..........

450188 ..... 01.0902 12.80 450347 ..... 01.1515 16.68 450558 ..... 01.7260 20.85 450688 ..... 01.3635 19.63 450811 ..... 02.1655 ..........

450190 ..... 01.1702 .......... 450348 ..... 00.9841 11.20 450559 ..... 00.9350 12.26 450690 ..... 01.4068 21.41 450812 ..... 01.5923 ..........

450191 ..... 01.0843 15.87 450351 ..... 01.1952 17.71 450561 ..... 01.6864 17.18 450691 ..... 00.9630 .......... 460001 ..... 01.8027 20.73

450192 ..... 01.2918 17.51 450352 ..... 01.1041 16.53 450563 ..... 01.2755 23.92 450694 ..... 01.1412 18.16 460003 ..... 01.6975 17.86

450193 ..... 02.0470 21.80 450353 ..... 01.2638 16.98 450565 ..... 01.2685 16.10 450696 ..... 01.9768 22.02 460004 ..... 01.7352 21.45

450194 ..... 01.2664 17.65 450355 ..... 01.1492 13.03 450570 ..... 01.0784 15.39 450697 ..... 01.4936 13.82 460005 ..... 01.6823 18.56

450196 ..... 01.4866 17.04 450358 ..... 02.0820 21.20 450571 ..... 01.4774 15.53 450698 ..... 00.9737 11.65 460006 ..... 01.4506 19.40

450200 ..... 01.4247 17.40 450362 ..... 01.1670 13.83 450573 ..... 01.0633 14.35 450700 ..... 00.9478 13.15 460007 ..... 01.3572 20.40

450201 ..... 01.0028 15.45 450369 ..... 01.0555 13.10 450574 ..... 00.9359 11.73 450702 ..... 01.5794 19.02 460008 ..... 01.3920 15.91

450203 ..... 01.2237 17.46 450370 ..... 01.2731 12.87 450575 ..... 01.0769 16.62 450703 ..... 01.5445 18.46 460009 ..... 01.8544 19.39

450209 ..... 01.5068 21.78 450371 ..... 01.1668 12.16 450578 ..... 00.9338 12.99 450704 ..... 01.4195 18.02 460010 ..... 02.0179 20.86

450210 ..... 01.1673 12.30 450372 ..... 01.3120 21.02 450580 ..... 01.1396 13.29 450705 ..... 00.9145 18.50 460011 ..... 01.4594 16.34

450211 ..... 01.4145 16.70 450373 ..... 01.1592 13.38 450583 ..... 00.9779 13.04 450706 ..... 01.2505 22.63 460013 ..... 01.5172 16.74

450213 ..... 01.6568 18.26 450374 ..... 00.9104 11.66 450584 ..... 01.1828 13.02 450709 ..... 01.3415 19.78 460014 ..... 01.1366 15.12

450214 ..... 01.4227 19.51 450376 ..... 01.4817 17.78 450586 ..... 01.0491 11.16 450711 ..... 01.5989 18.18 460015 ..... 01.2168 20.40

450217 ..... 01.0015 11.56 450378 ..... 01.1022 19.87 450587 ..... 01.2528 16.14 450712 ..... 00.7871 13.25 460016 ..... 00.9547 12.50
46068 Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations

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460017 ..... 01.5589 16.40 490032 ..... 01.7716 19.42 490127 ..... 01.0048 14.52 500094 ..... 00.9101 15.30 510068 ..... 01.1159 14.34

460018 ..... 01.0027 15.45 490033 ..... 01.2338 16.00 490129 ..... 01.1961 19.20 500096 ..... 00.9886 19.50 510070 ..... 01.3303 15.86

460019 ..... 01.1127 14.45 490035 ..... 01.1321 13.02 490130 ..... 01.3038 15.07 500097 ..... 01.2189 17.46 510071 ..... 01.3254 15.64

460020 ..... 01.0418 16.33 490037 ..... 01.2365 14.06 490131 ..... 00.9879 14.74 500098 ..... 01.0355 15.44 510072 ..... 01.0592 14.37

460021 ..... 01.3866 19.46 490038 ..... 01.2628 13.62 490132 ..... 01.0313 .......... 500101 ..... 01.0064 15.92 510077 ..... 01.1916 15.36

460022 ..... 00.9383 19.23 490040 ..... 01.4798 21.72 500001 ..... 01.3669 21.66 500102 ..... 01.0209 19.46 510080 ..... 01.2132 11.53

460023 ..... 01.2243 21.08 490041 ..... 01.2703 16.22 500002 ..... 01.4343 19.10 500104 ..... 01.3276 19.88 510081 ..... 01.1592 12.97

460024 ..... 01.0133 14.78 490042 ..... 01.3532 15.75 500003 ..... 01.3891 25.32 500106 ..... 00.9016 20.08 510082 ..... 01.2166 12.89

460025 ..... 00.8149 13.73 490043 ..... 01.4482 24.19 500005 ..... 01.8255 21.58 500107 ..... 01.1533 15.79 510084 ..... 00.9560 13.24

460026 ..... 00.9812 17.03 490044 ..... 01.3527 17.15 500007 ..... 01.3881 21.79 500108 ..... 01.7163 21.74 510085 ..... 01.3533 17.90

460027 ..... 00.9409 19.08 490045 ..... 01.2333 19.25 500008 ..... 01.9493 23.18 500110 ..... 01.2349 19.44 510086 ..... 01.0754 15.08

460029 ..... 01.0389 18.60 490046 ..... 01.4948 17.80 500011 ..... 01.4304 22.64 500118 ..... 01.1761 21.92 520002 ..... 01.2174 18.84

460030 ..... 01.1784 17.32 490047 ..... 01.0934 16.50 500012 ..... 01.4822 21.18 500119 ..... 01.3376 20.39 520003 ..... 01.1191 15.41

460032 ..... 01.0291 21.16 490048 ..... 01.6100 17.44 500014 ..... 01.4987 20.92 500122 ..... 01.2814 21.99 520004 ..... 01.1859 16.78

460033 ..... 00.9787 17.97 490050 ..... 01.4629 21.02 500015 ..... 01.3772 21.85 500123 ..... 00.8526 18.56 520006 ..... 01.0231 18.17

460035 ..... 00.9265 12.17 490052 ..... 01.6086 15.45 500016 ..... 01.4764 23.26 500124 ..... 01.3158 22.83 520007 ..... 01.2287 14.55

460036 ..... 01.0267 20.05 490053 ..... 01.2701 14.77 500019 ..... 01.3370 21.38 500125 ..... 01.0071 11.61 520008 ..... 01.5786 22.49

460037 ..... 00.9886 17.48 490054 ..... 01.0984 14.36 500021 ..... 01.5616 21.91 500129 ..... 01.7389 23.35 520009 ..... 01.6559 17.31

460039 ..... 01.0874 20.37 490057 ..... 01.5488 17.69 500023 ..... 01.2117 19.53 500132 ..... 00.9561 18.51 520010 ..... 01.1793 19.33

460041 ..... 01.2644 20.90 490059 ..... 01.6184 19.41 500024 ..... 01.6823 22.23 500134 ..... 00.6989 15.59 520011 ..... 01.2164 16.85

460042 ..... 01.4809 17.04 490060 ..... 01.0834 17.79 500025 ..... 01.8739 23.44 500138 ..... 04.3602 .......... 520013 ..... 01.3851 18.80

460043 ..... 01.2702 21.71 490063 ..... 01.7059 23.01 500026 ..... 01.4032 23.85 500139 ..... 01.5089 21.71 520014 ..... 01.1387 16.08

460044 ..... 01.1922 19.83 490066 ..... 01.3652 18.00 500027 ..... 01.5357 25.23 500141 ..... 01.3249 22.22 520015 ..... 01.1912 16.72

460046 ..... 00.9068 12.27 490067 ..... 01.2287 15.82 500028 ..... 01.1235 14.69 500143 ..... 00.7297 15.20 520016 ..... 01.1027 13.21

460047 ..... 01.7394 19.82 490069 ..... 01.4526 14.96 500029 ..... 00.9578 13.71 500146 ..... 01.2100 26.11 520017 ..... 01.1523 17.45

460049 ..... 01.9737 17.85 490071 ..... 01.5023 17.40 500030 ..... 01.5287 22.55 510001 ..... 01.8263 17.35 520018 ..... 01.1219 16.17

460050 ..... 01.2736 21.99 490073 ..... 01.4717 17.55 500031 ..... 01.3434 20.58 510002 ..... 01.2917 14.18 520019 ..... 01.3048 16.63

460051 ..... 01.2890 32.89 490074 ..... 01.3704 16.77 500033 ..... 01.2738 18.41 510004 ..... 01.1211 13.65 520021 ..... 01.3120 19.90

470001 ..... 01.1596 18.73 490075 ..... 01.3998 16.37 500036 ..... 01.3200 19.95 510005 ..... 00.9588 14.19 520024 ..... 01.0460 13.11

470003 ..... 01.7896 20.83 490077 ..... 01.2583 17.87 500037 ..... 01.1678 18.70 510006 ..... 01.2972 17.42 520025 ..... 01.1099 18.58

470004 ..... 01.1094 15.85 490079 ..... 01.3234 15.15 500039 ..... 01.3890 22.10 510007 ..... 01.4902 17.98 520026 ..... 01.0837 17.49

470005 ..... 01.2726 20.26 490083 ..... 00.7754 15.02 500041 ..... 01.2884 23.23 510008 ..... 01.1461 15.55 520027 ..... 01.2448 19.27

470006 ..... 01.2455 17.83 490084 ..... 01.3006 15.43 500042 ..... 01.3514 22.37 510012 ..... 01.1013 14.37 520028 ..... 01.3020 17.76

470008 ..... 01.1896 16.76 490085 ..... 01.2407 13.39 500043 ..... 01.1913 17.16 510013 ..... 01.1685 15.80 520029 ..... 00.9692 16.94

470010 ..... 01.1226 19.03 490088 ..... 01.1873 14.44 500044 ..... 01.9855 20.99 510015 ..... 00.9465 12.51 520030 ..... 01.6462 21.19

470011 ..... 01.1940 19.82 490089 ..... 01.1298 16.18 500045 ..... 01.1331 20.81 510016 ..... 00.9182 12.66 520031 ..... 01.1241 15.24

470012 ..... 01.2425 17.88 490090 ..... 01.2038 15.17 500048 ..... 00.9599 16.46 510018 ..... 01.1815 15.26 520032 ..... 01.2406 15.25

470015 ..... 01.2207 16.67 490091 ..... 01.2790 18.78 500049 ..... 01.5178 19.24 510020 ..... 01.1178 10.56 520033 ..... 01.1692 16.22

470018 ..... 01.2215 20.53 490092 ..... 01.2061 15.13 500050 ..... 01.4336 20.96 510022 ..... 01.8968 19.16 520034 ..... 01.1969 17.64

470020 ..... 00.9818 15.18 490093 ..... 01.3619 15.83 500051 ..... 01.6724 23.18 510023 ..... 01.2001 16.62 520035 ..... 01.3383 15.87

470023 ..... 01.2839 19.08 490094 ..... 01.1741 14.52 500052 ..... 01.3139 .......... 510024 ..... 01.4367 18.43 520037 ..... 01.6525 19.06

470024 ..... 01.1460 18.26 90095 ....... 01.4744 16.79 500053 ..... 01.3079 20.42 510026 ..... 01.0247 12.33 520038 ..... 01.3145 16.45

490001 ..... 01.2421 19.51 490097 ..... 01.1556 14.52 500054 ..... 01.8795 21.08 510027 ..... 00.9512 14.62 520039 ..... 00.9955 16.33

490002 ..... 01.0970 14.56 490098 ..... 01.2294 11.89 500055 ..... 01.1303 20.13 510028 ..... 01.0802 18.99 520040 ..... 01.4720 19.34

490003 ..... 00.5817 17.38 490099 ..... 00.9524 16.51 500057 ..... 01.3033 17.22 510029 ..... 01.2896 16.78 520041 ..... 01.1755 14.93

490004 ..... 01.2321 16.97 490100 ..... 01.4519 17.21 500058 ..... 01.5239 20.32 510030 ..... 01.0520 14.39 520042 ..... 01.0959 16.42

490005 ..... 01.5901 16.31 490101 ..... 01.2184 23.01 500059 ..... 01.1465 20.76 510031 ..... 01.4816 15.97 520044 ..... 01.4077 16.15

490006 ..... 01.1325 13.82 490104 ..... 00.8468 16.07 500060 ..... 01.4066 23.27 510033 ..... 01.3557 15.30 520045 ..... 01.7375 18.68

490007 ..... 02.0908 17.16 490105 ..... 00.6278 18.83 500061 ..... 01.0337 18.19 510035 ..... 01.3544 16.81 520047 ..... 00.9924 15.41

490009 ..... 01.8662 18.25 490106 ..... 00.8531 16.48 500062 ..... 01.1280 18.80 510036 ..... 01.0700 11.64 520048 ..... 01.4686 18.11

490010 ..... 01.1620 17.32 490107 ..... 01.3316 22.98 500064 ..... 01.5976 22.08 510038 ..... 01.1634 13.36 520049 ..... 02.0343 18.52

490011 ..... 01.4246 17.33 490108 ..... 00.9024 15.63 500065 ..... 01.2132 18.72 510039 ..... 01.3333 15.48 520051 ..... 01.7979 20.21

490012 ..... 01.2241 15.30 490109 ..... 00.9343 17.44 500068 ..... 01.0323 18.40 510043 ..... 00.9309 11.52 520053 ..... 01.1225 15.45

490013 ..... 01.2162 16.87 490110 ..... 01.4172 15.07 500069 ..... 01.2241 19.76 510046 ..... 01.2754 15.91 520054 ..... 01.0821 17.03

490014 ..... 01.4751 22.42 490111 ..... 01.2461 15.83 500071 ..... 01.2885 19.80 510047 ..... 01.2479 18.06 520056 ..... 01.7830 18.87

490015 ..... 01.4306 18.76 490112 ..... 01.6008 18.51 500072 ..... 01.2068 22.83 510048 ..... 01.0995 18.22 520057 ..... 01.1240 16.59

490017 ..... 01.3604 16.73 490113 ..... 01.3485 21.59 500073 ..... 01.0538 16.74 510050 ..... 01.5736 16.11 520058 ..... 01.1053 18.17

490018 ..... 01.2979 17.15 490114 ..... 01.1423 15.47 500074 ..... 01.1566 15.67 510053 ..... 01.0292 14.12 520059 ..... 01.4116 18.74

490019 ..... 01.1915 16.46 490115 ..... 01.2238 15.28 500077 ..... 01.3828 21.68 510055 ..... 01.2750 19.68 520060 ..... 01.4316 15.26

490020 ..... 01.2068 15.76 490116 ..... 01.3302 15.48 500079 ..... 01.3693 21.40 510058 ..... 01.1979 17.03 520062 ..... 01.3513 16.73

490021 ..... 01.2417 17.33 490117 ..... 01.1816 12.41 500080 ..... 00.8662 11.72 510059 ..... 01.4663 14.25 520063 ..... 01.1984 17.63

490022 ..... 01.4384 19.33 490118 ..... 01.7802 21.05 500084 ..... 01.1803 20.78 510060 ..... 01.1522 15.55 520064 ..... 01.7055 20.15

490023 ..... 01.2952 18.01 490119 ..... 01.3722 16.80 500085 ..... 01.0712 19.55 510061 ..... 01.0354 13.37 520066 ..... 01.5293 18.82

490024 ..... 01.8236 16.47 490120 ..... 01.3270 17.49 500086 ..... 01.3028 20.03 510062 ..... 01.1776 15.77 520068 ..... 00.9933 16.85

490027 ..... 01.1664 13.62 490122 ..... 01.4656 21.27 500088 ..... 01.3456 23.37 510063 ..... 00.9557 16.84 520069 ..... 01.1907 17.13

490028 ..... 01.3111 20.18 490123 ..... 01.1882 15.29 500089 ..... 01.0257 15.05 510065 ..... 01.0484 11.49 520070 ..... 01.6330 17.38

490030 ..... 01.1733 10.83 490124 ..... 01.2019 17.12 500090 ..... 00.9484 13.67 510066 ..... 01.1361 11.93 520071 ..... 01.1630 17.53

490031 ..... 01.1165 13.00 490126 ..... 01.4239 14.85 500092 ..... 01.0566 17.86 510067 ..... 01.2728 17.97 520074 ..... 01.0679 15.42
Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations 46069

PAGE 16 OF 16

Provider

Case

mix

index

Avg.

hour

wage

Provider

Case

mix

index

Avg.

hour

wage

Provider

Case

mix

index

Avg.

hour

wage

Provider

Case

mix

index

Avg.

hour

wage

Provider

Case

mix

index

Avg.

hour

wage

520075 ..... 01.4659 18.02 520178 ..... 01.0937 15.23

520076 ..... 01.1585 15.11 530002 ..... 01.1955 19.16

520077 ..... 00.8551 14.03 530003 ..... 01.0202 12.47

520078 ..... 01.6233 18.63 530004 ..... 00.9991 14.18

520082 ..... 01.2821 16.43 530005 ..... 01.0060 13.47

520083 ..... 01.6785 21.60 530006 ..... 01.1364 16.52

520084 ..... 01.0951 16.87 530007 ..... 01.0868 12.98

520087 ..... 01.6994 18.12 530008 ..... 01.3367 16.82

520088 ..... 01.3078 17.98 530009 ..... 01.0070 16.77

520089 ..... 01.5203 19.50 530010 ..... 01.4089 16.12

520090 ..... 01.2399 16.18 530011 ..... 01.1090 16.94

520091 ..... 01.3644 18.13 530012 ..... 01.5439 18.11

520092 ..... 01.1184 15.74 530014 ..... 01.4219 15.18

520094 ..... 00.7907 16.12 530015 ..... 01.2693 18.00

520095 ..... 01.3677 17.93 530016 ..... 01.2968 14.93

520096 ..... 01.4350 18.94 530017 ..... 00.8748 16.97

520097 ..... 01.3153 18.65 530018 ..... 01.0355 18.67

520098 ..... 01.8227 20.17 530019 ..... 01.0131 15.32

520100 ..... 01.2523 16.72 530022 ..... 01.0905 16.71

520101 ..... 01.1235 16.09 530023 ..... 00.8558 18.57

520102 ..... 01.2023 19.37 530025 ..... 01.2400 18.76

520103 ..... 01.3272 17.94 530026 ..... 01.0951 15.48

520107 ..... 01.3034 17.50 530027 ..... 00.9181 10.62

520109 ..... 01.0055 17.63 530029 ..... 01.0278 13.46

520110 ..... 01.1560 17.94 530031 ..... 00.8952 11.67

520111 ..... 00.9540 16.01 530032 ..... 01.0887 18.13

520112 ..... 01.1157 16.89

520113 ..... 01.2035 19.18

520114 ..... 01.0837 13.27

520115 ..... 01.2596 16.02

520116 ..... 01.2507 18.13

520117 ..... 01.0605 15.78

520118 ..... 00.9421 10.53

520120 ..... 00.8814 12.70

520121 ..... 00.9486 15.67

520122 ..... 00.9718 14.73

520123 ..... 01.0916 16.93

520124 ..... 01.1417 14.93

520130 ..... 01.0461 13.47

520131 ..... 01.0271 16.78

520132 ..... 01.1689 14.48

520134 ..... 01.0798 15.97

520135 ..... 00.9421 17.28

520136 ..... 01.5062 19.05

520138 ..... 01.8573 19.44

520139 ..... 01.2790 19.89

520140 ..... 01.6111 21.15

520141 ..... 01.0486 15.86

520142 ..... 00.8690 13.20

520144 ..... 01.0297 16.42

520145 ..... 00.9171 16.59

520146 ..... 01.0863 13.94

520148 ..... 01.0827 15.34

520149 ..... 00.9713 13.44

520151 ..... 01.0919 15.42

520152 ..... 01.1594 17.07

520153 ..... 00.9221 13.81

520154 ..... 01.0972 17.71

520156 ..... 01.1062 16.69

520157 ..... 01.0427 13.77

520159 ..... 00.9343 16.85

520160 ..... 01.7979 19.07

520161 ..... 01.0019 15.94

520170 ..... 01.2386 19.95

520171 ..... 00.9327 13.23

520173 ..... 01.1538 18.34

520174 ..... 01.3545 21.51

520177 ..... 01.5931 20.16

Note: Case mix indexes do not include discharges from PPS-exempt units.

Case mix indexes include cases received in HCFA central office through December 1996.
46070 Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations

TABLE 4A.—WAGE INDEX AND CAPITAL

GEOGRAPHIC ADJUSTMENT FACTOR

(GAF) FOR URBAN AREAS

Urban Area (Constituent

Counties)

Wage

index GAF

0040 Abilene, TX ........ 0.8287 0.8793

Taylor, TX

0060 2Aguadilla, PR .. 0.4224 0.5542

Aguada, PR

Aguadilla, PR

Moca, PR

0080 Akron, OH .......... 0.9728 0.9813

Portage, OH

Summit, OH

0120 Albany, GA ........ 0.7914 0.8520

Dougherty, GA

Lee, GA

0160 Albany-Schenectady-Troy, NY ............ 0.8480 0.8932

Albany, NY

Montgomery, NY

Rensselaer, NY

Saratoga, NY

Schenectady, NY

Schoharie, NY

0200 Albuquerque, NM 0.9329 0.9535

Bernalillo, NM

Sandoval, NM

Valencia, NM

0220 Alexandria, LA ... 0.8269 0.8780

Rapides, LA

0240 Allentown-Bethlehem-Easton, PA ..... 1.0086 1.0059

Carbon, PA

Lehigh, PA

Northampton, PA

0280 Altoona, PA ....... 0.9137 0.9401

Blair, PA

0320 Amarillo,.

TX Potter, TX 0.9425 0.9603

Randall, TX

0380 Anchorage, AK .. 1.2998 1.1967

Anchorage, AK

0440 Ann Arbor, MI .... 1.1785 1.1190

Lenawee, MI

Livingston, MI

Washtenaw, MI

0450 Anniston, AL ...... 0.8266 0.8777

Calhoun, AL

0460 Appleton-Oshkosh-Neenah, WI ....... 0.8996 0.9301

Calumet, WI

Outagamie, WI

Winnebago, WI

0470 2Arecibo, PR ..... 0.4224 0.5542

Arecibo, PR

Camuy, PR

Hatillo, PR

0480 Asheville, NC ..... 0.9072 0.9355

Buncombe, NC

Madison, NC

0500 Athens, GA ........ 0.9087 0.9365

Clarke, GA

Madison, GA

Oconee, GA

0520 1Atlanta, GA ...... 0.9823 0.9878

Barrow, GA

Bartow, GA

Carroll, GA

Cherokee, GA

Clayton, GA

Cobb, GA

Coweta, GA

DeKalb, GA

TABLE 4A.—WAGE INDEX AND CAPITAL

GEOGRAPHIC ADJUSTMENT FACTOR

(GAF) FOR URBAN AREAS—Continued

Urban Area (Constituent

Counties)

Wage

index GAF

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 ..................... 1.0724 1.0490

Atlantic, NJ

Cape May, NJ

0600 Augusta-Aiken,

GA–SC ...................... 0.9333 0.9538

Columbia, GA

McDuffie, GA

Richmond, GA

Aiken, SC

Edgefield, SC

0640 1Austin-San

Marcos, TX ................ 0.9133 0.9398

Bastrop, TX

Caldwell, TX

Hays, TX

Travis, TX

Williamson, TX

0680 Bakersfield, CA .. 1.0014 1.0010

Kern, CA

0720 1Baltimore, MD 0.9689 0.9786

Anne Arundel, MD

Baltimore, MD

Baltimore City, MD

Carroll, MD

Harford, MD

Howard, MD

Queen Anne’s, MD

0733 Bangor, ME ....... 0.9478 0.9640

Penobscot, ME

0743 Barnstable-Yarmouth, MA ................. 1.4291 1.2770

Barnstable, MA

0760 Baton Rouge, LA 0.8382 0.8862

Ascension, LA

East Baton Rouge, LA

Livingston, LA

West Baton Rouge,

LA

0840 Beaumont-Port

Arthur, TX .................. 0.8593 0.9014

Hardin, TX

Jefferson, TX

Orange, TX

0860 Bellingham, WA 1.1221 1.0821

Whatcom, WA

0870 2Benton Harbor,

MI ............................... 0.8923 0.9249

Berrien, MI

0875 1Bergen-Passaic, NJ ...................... 1.1570 1.1050

Bergen, NJ

Passaic, NJ

0880 Billings, MT ........ 0.9783 0.9851

Yellowstone, MT

TABLE 4A.—WAGE INDEX AND CAPITAL

GEOGRAPHIC ADJUSTMENT FACTOR

(GAF) FOR URBAN AREAS—Continued

Urban Area (Constituent

Counties)

Wage

index GAF

0920 Biloxi-GulfportPascagoula, MS ........ 0.8415 0.8885

Hancock, MS

Harrison, MS

Jackson, MS

0960 Binghamton, NY 0.8914 0.9243

Broome, NY

Tioga, NY

1000 Birmingham, AL 0.9005 0.9307

Blount, AL

Jefferson, AL

St. Clair, AL

Shelby, AL

1010 Bismarck, ND .... 0.7859 0.8479

Burleigh, ND

Morton, ND

1020 Bloomington, IN 0.9128 0.9394

Monroe, IN

1040 Bloomington-Normal, IL ........................ 0.8733 0.9114

McLean, IL

1080 Boise City, ID .... 0.8887 0.9224

Ada, ID

Canyon, ID

1123 1Boston-Worcester-Lawrence-LowellBrockton, MA–NH ...... 1.1436 1.0962

Bristol, MA

Essex, MA

Middlesex, MA

Norfolk, MA

Plymouth, MA

Suffolk, MA

Worcester, MA

Hillsborough, NH

Merrimack, NH

Rockingham, NH

Strafford, NH

1125 BoulderLongmont, CO ........... 1.0015 1.0010

Boulder, CO

1145 Brazoria, TX ...... 0.9129 0.9395

Brazoria, TX

1150 Bremerton, WA .. 1.0999 1.0674

Kitsap, WA

1240 Brownsville-Harlingen-San Benito, TX 0.8740 0.9119

Cameron, TX

1260 Bryan-College

Station, TX ................. 0.8571 0.8998

Brazos, TX

1280 1Buffalo-Niagara

Falls, NY .................... 0.9272 0.9496

Erie, NY

Niagara, NY

1303 Burlington, VT .... 1.0142 1.0097

Chittenden, VT

Franklin, VT

Grand Isle, VT

1310 Caguas, PR ....... 0.4508 0.5795

Caguas, PR

Cayey, PR

Cidra, PR

Gurabo, PR

San Lorenzo, PR

1320 CantonMassillon, OH ............ 0.8961 0.9276
Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations 46071

TABLE 4A.—WAGE INDEX AND CAPITAL

GEOGRAPHIC ADJUSTMENT FACTOR

(GAF) FOR URBAN AREAS—Continued

Urban Area (Constituent

Counties)

Wage

index GAF

Carroll, OH

Stark, OH

1350 Casper, WY ....... 0.9013 0.9313

Natrona, WY

1360 Cedar Rapids, IA 0.8529 0.8968

Linn, IA

1400 Champaign-Urbana, IL ..................... 0.8824 0.9179

Champaign, IL

1440 Charleston-North

Charleston, SC .......... 0.8807 0.9167

Berkeley, SC

Charleston, SC

Dorchester, SC

1480 Charleston, WV 0.9142 0.9404

Kanawha, WV

Putnam, WV

1520 1 Charlotte-Gastonia-Rock Hill, NC–

SC .............................. 0.9710 0.9800

Cabarrus, NC

Gaston, NC

Lincoln, NC

Mecklenburg, NC

Rowan, NC

Stanly, NC

Union, NC

York, SC

1540 Charlottesville,

VA .............................. 0.9051 0.9340

Albemarle, VA

Charlottesville City,

VA

Fluvanna, VA

Greene, VA

1560 Chattanooga,

TN–GA ....................... 0.8658 0.9060

Catoosa, GA

Dade, GA

Walker, GA

Hamilton, TN

Marion, TN

1580 2 Cheyenne, WY 0.8247 0.8764

Laramie, WY

16001 Chicago, IL .......... 1.0860 1.0581

Cook, IL

DeKalb, IL

DuPage, IL

Grundy, IL

Kane, IL

Kendall, IL

Lake, IL

McHenry, IL

Will, IL

1620 Chico-Paradise,

CA .............................. 1.0429 1.0292

Butte, CA

16401 Cincinnati, OH–

KY–IN ........................ 0.9521 0.9669

Dearborn, IN

Ohio, IN

Boone, KY

Campbell, KY

Gallatin, KY

Grant, KY

Kenton, KY

Pendleton, KY

TABLE 4A.—WAGE INDEX AND CAPITAL

GEOGRAPHIC ADJUSTMENT FACTOR

(GAF) FOR URBAN AREAS—Continued

Urban Area (Constituent

Counties)

Wage

index GAF

Brown, OH

Clermont, OH

Hamilton, OH

Warren, OH

1660 Clarksville-Hopkinsville, TN–KY ........ 0.7852 0.8474

Christian, KY

Montgomery, TN

16801 Cleveland-LorainElyria, OH .................. 0.9804 0.9865

Ashtabula, OH

Cuyahoga, OH

Geauga, OH

Lake, OH

Lorain, OH

Medina, OH

1720 Colorado

Springs, CO ............... 0.9316 0.9526

El Paso, CO

1740 Columbia, MO ... 0.9001 0.9305

Boone, MO

1760 Columbia, SC .... 0.9192 0.9439

Lexington, SC

Richland, SC

1800 Columbus, GA–

AL .............................. 0.8288 0.8793

Russell, AL

Chattahoochee, GA

Harris, GA

Muscogee, GA

18401 Columbus, OH .... 0.9793 0.9858

Delaware, OH

Fairfield, OH

Franklin, OH

Licking, OH

Madison, OH

Pickaway, OH

1880 Corpus Christi,

TX .............................. 0.8945 0.9265

Nueces, TX

San Patricio, TX

1900 Cumberland,

MD–WV ..................... 0.8822 0.9178

Allegany, MD

Mineral, WV

1920 1 Dallas, TX ........ 0.9674 0.9776

Collin, TX

Dallas, TX

Denton, TX

Ellis, TX

Henderson, TX

Hunt, TX

Kaufman, TX

Rockwall, TX

1950 Danville, VA ....... 0.8146 0.8690

Danville City, VA

Pittsylvania, VA

1960 Davenport-Moline-Rock Island, IA–

IL ................................ 0.8405 0.8878

Scott, IA

Henry, IL

Rock Island, IL

2000 Dayton-Springfield, OH .................... 0.9279 0.9500

Clark, OH

Greene, OH

TABLE 4A.—WAGE INDEX AND CAPITAL

GEOGRAPHIC ADJUSTMENT FACTOR

(GAF) FOR URBAN AREAS—Continued

Urban Area (Constituent

Counties)

Wage

index GAF

Miami, OH

Montgomery, OH

2020 2 Daytona Beach,

FL .............................. 0.8838 0.9189

Flagler, FL

Volusia, FL

2030 Decatur, AL ....... 0.8286 0.8792

Lawrence, AL

Morgan, AL

2040 Decatur, IL ......... 0.7915 0.8520

Macon, IL

2080 1 Denver, CO ..... 1.0386 1.0263

Adams, CO

Arapahoe, CO

Denver, CO

Douglas, CO

Jefferson, CO

2120 Des Moines, IA .. 0.8837 0.9188

Dallas, IA

Polk, IA

Warren, IA

21601 Detroit, MI ........... 1.0840 1.0568

Lapeer, MI

Macomb, MI

Monroe, MI

Oakland, MI

St. Clair, MI

Wayne, MI

2180 Dothan, AL ........ 0.8070 0.8634

Dale, AL

Houston, AL

2190 Dover, DE .......... 0.9303 0.9517

Kent, DE

2200 Dubuque, IA ...... 0.8088 0.8647

Dubuque, IA

2240 Duluth-Superior,

MN–WI ....................... 0.9779 0.9848

St. Louis, MN

Douglas, WI

2281 Dutchess County, NY ......................... 1.0632 1.0429

Dutchess, NY

2290 Eau Claire, WI ... 0.8764 0.9136

Chippewa, WI

Eau Claire, WI

2320 El Paso, TX ....... 1.0123 1.0084

El Paso, TX

2330 Elkhart-Goshen,

IN ............................... 0.9081 0.9361

Elkhart, IN

2335 2Elmira, NY ....... 0.8401 0.8875

Chemung, NY

2340 Enid, OK ............ 0.7962 0.8555

Garfield, OK

2360 Erie, PA ............. 0.8862 0.9206

Erie, PA

2400 Eugene-Springfield, OR .................... 1.1659 1.1108

Lane, OR

2440 Evansville-Henderson, IN–KY ........... 0.8641 0.9048

Posey, IN

Vanderburgh, IN

Warrick, IN

Henderson, KY

2520 Fargo-Moorhead,

ND–MN ...................... 0.8837 0.9188
46072 Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations

TABLE 4A.—WAGE INDEX AND CAPITAL

GEOGRAPHIC ADJUSTMENT FACTOR

(GAF) FOR URBAN AREAS—Continued

Urban Area (Constituent

Counties)

Wage

index GAF

Clay, MN

Cass, ND

2560 Fayetteville, NC 0.8734 0.9115

Cumberland, NC

2580 FayettevilleSpringdale-Rogers,

AR .............................. 0.7461 0.8183

Benton, AR

Washington, AR

2620 Flagstaff, AZ–UT 0.9115 0.9385

Coconino, AZ

Kane, UT

2640 Flint, MI .............. 1.1171 1.0788

Genesee, MI

2650 Florence, AL ...... 0.7716 0.8373

Colbert, AL

Lauderdale, AL

2655 Florence, SC ..... 0.8711 0.9098

Florence, SC

2670 Fort CollinsLoveland, CO ............ 1.0248 1.0169

Larimer, CO

2680 1Ft. Lauderdale,

FL .............................. 1.0487 1.0331

Broward, FL

2700 2Fort MyersCape Coral, FL .......... 0.8838 0.9189

Lee, FL

2710 Fort Pierce-Port

St. Lucie, FL .............. 1.0257 1.0175

Martin, FL

St. Lucie, FL

2720 Fort Smith, AR–

OK ............................. 0.7769 0.8412

Crawford, AR

Sebastian, AR

Sequoyah, OK

2750 2Fort Walton

Beach, FL .................. 0.8838 0.9189

Okaloosa, FL

2760 Fort Wayne, IN .. 0.8901 0.9234

Adams, IN

Allen, IN

De Kalb, IN

Huntington, IN

Wells, IN

Whitley, IN

2800 1Forth Worth-Arlington, TX ................. 0.9997 0.9998

Hood, TX

Johnson, TX

Parker, TX

Tarrant, TX

2840 Fresno, CA ........ 1.0607 1.0412

Fresno, CA

Madera, CA

2880 Gadsden, AL ..... 0.8815 0.9173

Etowah, AL

2900 Gainesville, FL ... 0.9616 0.9735

Alachua, FL

2920 Galveston-Texas

City, TX ...................... 1.0564 1.0383

Galveston, TX

2960 Gary, IN ............. 0.9270 0.9494

Lake, IN

Porter, IN

2975 2Glens Falls, NY 0.8401 0.8875

TABLE 4A.—WAGE INDEX AND CAPITAL

GEOGRAPHIC ADJUSTMENT FACTOR

(GAF) FOR URBAN AREAS—Continued

Urban Area (Constituent

Counties)

Wage

index GAF

Warren, NY

Washington, NY

2980 Goldsboro, NC ... 0.8443 0.8906

Wayne, NC

2985 Grand Forks,

ND–MN ...................... 0.8815 0.9173

Polk, MN

Grand Forks, ND

2995 Grand Junction,

CO ............................. 0.9491 0.9649

Mesa, CO

3000 1Grand RapidsMuskegon-Holland, MI 1.0147 1.0100

Allegan, MI

Kent, MI

Muskegon, MI

Ottawa, MI

3040 Great Falls, MT 0.9306 0.9519

Cascade, MT

3060 Greeley, CO ...... 1.0097 1.0066

Weld, CO

3080 Green Bay, WI ... 0.9585 0.9714

Brown, WI

3120 1GreensboroWinston-Salem-High

Point, NC ................... 0.9351 0.9551

Alamance, NC

Davidson, NC

Davie, NC

Forsyth, NCGuilford,

NC

Randolph, NC

Stokes, NC

Yadkin, NC

3150 Greenville, NC ... 0.9064 0.9349

Pitt, NC

3160 GreenvilleSpartanburg-Anderson, SC ...................... 0.9059 0.9346

Anderson, SC

Cherokee, SC

Greenville, SC

Pickens, SC

Spartanburg, SC

3180 Hagerstown, MD 0.9681 0.9780

Washington, MD

3200 Hamilton-Middletown, OH ................... 0.8767 0.9138

Butler, OH

3240 Harrisburg-Lebanon-Carlisle, PA ...... 1.0187 1.0128

Cumberland, PA

Dauphin, PA

Lebanon, PA

Perry, PA

3283 1,2Hartford, CT ... 1.2617 1.1726

Hartford, CT

Litchfield, CT

Middlesex, CT

Tolland, CT

3285 Hattiesburg, MS 0.7192 0.7979

Forrest, MS

Lamar, MS

3290 Hickory-Morganton-Lenoir, NC ........... 0.8285 0.8791

Alexander, NC

Burke, NC

TABLE 4A.—WAGE INDEX AND CAPITAL

GEOGRAPHIC ADJUSTMENT FACTOR

(GAF) FOR URBAN AREAS—Continued

Urban Area (Constituent

Counties)

Wage

index GAF

Caldwell, NC

Catawba, NC

3320 Honolulu, HI ....... 1.1817 1.1211

Honolulu, HI

3350 Houma, LA ........ 0.7854 0.8475

Lafourche, LA

Terrebonne, LA

3360 1 Houston, TX .... 0.9855 0.9900

Chambers, TX

Fort Bend, TX

Harris, TX

Liberty, TX

Montgomery, TX

Waller, TX

3400 Huntington-Ashland, WV–KY–OH ...... 0.9160 0.9417

Boyd, KY

Carter, KY

Greenup, KY

Lawrence, OH

Cabell, WV

Wayne, WV

3440 Huntsville, AL .... 0.8485 0.8936

Limestone, AL

Madison, AL

3480 1 Indianapolis, IN 0.9848 0.9896

Boone, IN

Hamilton, IN

Hancock, IN

Hendricks, IN

Johnson, IN

Madison, IN

Marion, IN

Morgan, IN

Shelby, IN

3500 Iowa City, IA ...... 0.9401 0.9586

Johnson, IA

3520 Jackson, MI ....... 0.9052 0.9341

Jackson, MI

3560 Jackson, MS ...... 0.7790 0.8428

Hinds, MS

Madison, MS

Rankin, MS

3580 Jackson, TN ...... 0.8522 0.8963

Madison, TN

Chester, TN

3600 1 Jacksonville, FL 0.8969 0.9282

Clay, FL

Duval, FL

Nassau, FL

St. Johns, FL

3605 2 Jacksonville,

NC ............................. 0.7939 0.8538

Onslow, NC

3610 2 Jamestown, NY 0.8401 0.8875

Chautauqua, NY

3620 Janesville-Beloit,

WI .............................. 0.8824 0.9179

Rock, WI

3640 Jersey City, NJ .. 1.1412 1.0947

Hudson, NJ

3660 Johnson CityKingsport-Bristol, TN–

VA .............................. 0.9114 0.9384

Carter, TN

Hawkins, TN

Sullivan, TN
Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations 46073

TABLE 4A.—WAGE INDEX AND CAPITAL

GEOGRAPHIC ADJUSTMENT FACTOR

(GAF) FOR URBAN AREAS—Continued

Urban Area (Constituent

Counties)

Wage

index GAF

Unicoi, TN

Washington, TN

Bristol City, VA

Scott, VA

Washington, VA

3680 2 Johnstown, PA 0.8421 0.8890

Cambria, PA

Somerset, PA

3700 Jonesboro, AR ... 0.7443 0.8169

Craighead, AR

3710 Joplin, MO ......... 0.7541 0.8243

Jasper, MO

Newton, MO

3720 KalamazooBattlecreek, MI .......... 1.0668 1.0453

Calhoun, MI

Kalamazoo, MI

Van Buren, MI

3740 Kankakee, IL ..... 0.8653 0.9057

Kankakee, IL

3760 1Kansas City,

KS–MO ...................... 0.9564 0.9699

Johnson, KS

Leavenworth, KS

Miami, KS

Wyandotte, KS

Cass, MO

Clay, MO

Clinton, MO

Jackson, MO

Lafayette, MO

Platte, MO

Ray, MO

3800 Kenosha, WI ...... 0.9196 0.9442

Kenosha, WI

3810 Killeen-Temple,

TX .............................. 1.0252 1.0172

Bell, TX

Coryell, TX

3840 Knoxville, TN ..... 0.8831 0.9184

Anderson, TN

Blount, TN

Knox, TN

Loudon, TN

Sevier, TN

Union, TN

3850 Kokomo, IN ........ 0.8416 0.8886

Howard, IN

Tipton, IN

3870 La Crosse, WI–

MN ............................. 0.8749 0.9125

Houston, MN

La Crosse, WI

3880 Lafayette, LA ..... 0.8227 0.8749

Acadia, LA

Lafayette, LA

St. Landry, LA

St. Martin, LA

3920 Lafayette, IN ...... 0.9174 0.9427

Clinton, IN

Tippecanoe, IN

3960 Lake Charles, LA 0.7776 0.8418

Calcasieu, LA

3980 2 Lakeland-Winter Haven, FL ............ 0.8838 0.9189

Polk, FL

4000 Lancaster, PA .... 0.9481 0.9642

TABLE 4A.—WAGE INDEX AND CAPITAL

GEOGRAPHIC ADJUSTMENT FACTOR

(GAF) FOR URBAN AREAS—Continued

Urban Area (Constituent

Counties)

Wage

index GAF

Lancaster, PA

4040 Lansing-East

Lansing, MI ................ 1.0088 1.0060

Clinton, MI

Eaton, MI

Ingham, MI

4080 2 Laredo, TX ...... 0.7404 0.8140

Webb, TX

4100 Las Cruces, NM 0.8658 0.9060

Dona Ana, NM

4120 1 Las Vegas,

NV–AZ ....................... 1.0592 1.0402

Mohave, AZ

Clark, NV

Nye, NV

4150 Lawrence, KS .... 0.8608 0.9024

Douglas, KS

4200 Lawton, OK ........ 0.9045 0.9336

Comanche, OK

4243 Lewiston-Auburn,

ME ............................. 0.9536 0.9680

Androscoggin, ME

4280 Lexington, KY .... 0.8416 0.8886

Bourbon, KY

Clark, KY

Fayette, KY

Jessamine, KY

Madison, KY

Scott, KY

Woodford, KY

4320 Lima, OH ........... 0.9185 0.9434

Allen, OH

Auglaize, OH

4360 Lincoln, NE ........ 0.9231 0.9467

Lancaster, NE

4400 Little Rock-North

Little Rock, AR .......... 0.8490 0.8940

Faulkner, AR

Lonoke, AR

Pulaski, AR

Saline, AR

4420 Longview-Marshall, TX .................... 0.8613 0.9028

Gregg, TX

Harrison, TX

Upshur, TX

44801 Los Angeles-Long

Beach, CA ................. 1.2268 1.1503

Los Angeles, CA

4520 Louisville, KY–IN 0.9507 0.9660

Clark, IN

Floyd, IN

Harrison, IN

Scott, IN

Bullitt, KY

Jefferson, KY

Oldham, KY

4600 Lubbock, TX ...... 0.8400 0.8875

Lubbock, TX

4640 Lynchburg, VA ... 0.8228 0.8750

Amherst, VA

Bedford, VA

Bedford City, VA

Campbell, VA

Lynchburg City, VA

4680 Macon, GA ........ 0.9227 0.9464

Bibb, GA

TABLE 4A.—WAGE INDEX AND CAPITAL

GEOGRAPHIC ADJUSTMENT FACTOR

(GAF) FOR URBAN AREAS—Continued

Urban Area (Constituent

Counties)

Wage

index GAF

Houston, GA

Jones, GA

Peach, GA

Twiggs, GA

4720 Madison, WI ...... 1.0055 1.0038

Dane, WI

4800 Mansfield, OH .... 0.8639 0.9047

Crawford, OH

Richland, OH

4840 Mayaguez, PR ... 0.4475 0.5766

Anasco, PR

Cabo Rojo, PR

Hormigueros, PR

Mayaguez, PR

Sabana Grande, PR

San German, PR

4880 McAllen-Edinburg-Mission, TX ....... 0.8371 0.8854

Hidalgo, TX

4890 Medford-Ashland, OR .................... 1.0354 1.0241

Jackson, OR

49002 MelbourneTitusville-Palm Bay,

FL .............................. 0.8838 0.9189

Brevard, FL

4920 1 Memphis, TN–

AR–MS ...................... 0.8589 0.9011

Crittenden, AR

DeSoto, MS

Fayette, TN

Shelby, TN

Tipton, TN

4940 Merced, CA ....... 1.0947 1.0639

Merced, CA

5000 1 Miami, FL ........ 0.9859 0.9903

Dade, FL

5015 1 Middlesex-Somerset-Hunterdon, NJ .. 1.0875 1.0591

Hunterdon, NJ

Middlesex, NJ

Somerset, NJ

5080 1 MilwaukeeWaukesha, WI ........... 0.9819 0.9876

Milwaukee, WI

Ozaukee, WI

Washington, WI

Waukesha, WI

5120 1 Minneapolis-St.

Paul, MN–WI ............. 1.0733 1.0496

Anoka, MN

Carver, MN

Chisago, MN

Dakota, MN

Hennepin, MN

Isanti, MN

Ramsey, MN

Scott, MN

Sherburne, MN

Washington, MN

Wright, MN

Pierce, WI

St. Croix, WI

5160 Mobile, AL ......... 0.8455 0.8914

Baldwin, AL

Mobile, AL

5170 Modesto, CA ...... 1.0377 1.0257
46074 Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations

TABLE 4A.—WAGE INDEX AND CAPITAL

GEOGRAPHIC ADJUSTMENT FACTOR

(GAF) FOR URBAN AREAS—Continued

Urban Area (Constituent

Counties)

Wage

index GAF

Stanislaus, CA

5190 1 MonmouthOcean, NJ ................. 1.0934 1.0631

Monmouth, NJ

Ocean, NJ

5200 Monroe, LA ........ 0.8414 0.8885

Ouachita, LA

5240 Montgomery, AL 0.7813 0.8445

Autauga, AL

Elmore, AL

Montgomery, AL

5280 Muncie, IN ......... 0.9173 0.9426

Delaware, IN

5330 Myrtle Beach,

SC .............................. 0.8072 0.8636

Horry, SC

5345 Naples, FL ......... 1.0109 1.0075

Collier, FL

5360 1 Nashville, TN ... 0.9182 0.9432

Cheatham, TN

Davidson, TN

Dickson, TN

Robertson, TN

Rutherford, TN

Sumner, TN

Williamson, TN

Wilson, TN

5380 1 Nassau-Suffolk,

NY .............................. 1.3807 1.2472

Nassau, NY

Suffolk, NY

5483 1 New HavenBridgeport-StamfordWaterbury- ................. 1.2619 1.1727

Danbury, CT

Fairfield, CT

New Haven, CT

5523 2 New LondonNorwich, CT ............... 1.2617 1.1726

New London, CT

5560 1 New Orleans,

LA .............................. 0.9566 0.9701

Jefferson, LA

Orleans, LA

Plaquemines, LA

St. Bernard, LA

St. Charles, LA

St. James, LA

St. John The Baptist,

LA

St. Tammany, LA

5600 1 New York, NY 1.3982 1.2580

Bronx, NY

Kings, NY

New York, NY

Putnam, NY

Queens, NY

Richmond, NY

Rockland, NY

Westchester, NY

5640 1 Newark, NJ ...... 1.1111 1.0748

Essex, NJ

Morris, NJ

Sussex, NJ

Union, NJ

Warren, NJ

5660 Newburgh, NY–

PA .............................. 1.1283 1.0862

TABLE 4A.—WAGE INDEX AND CAPITAL

GEOGRAPHIC ADJUSTMENT FACTOR

(GAF) FOR URBAN AREAS—Continued

Urban Area (Constituent

Counties)

Wage

index GAF

Orange, NY

Pike, PA

5720 1 Norfolk-Virginia

Beach-Newport News,

VA–NC ....................... 0.8316 0.8814

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 1Oakland, CA .... 1.5158 1.3295

Alameda, CA

Contra Costa, CA

5790 Ocala, FL ........... 0.9032 0.9327

Marion, FL

5800 Odessa-Midland,

TX .............................. 0.8660 0.9062

Ector, TX

Midland, TX

5880 1Oklahoma City,

OK ............................. 0.8481 0.8933

Canadian, OK

Cleveland, OK

Logan, OK

McClain, OK

Oklahoma, OK

Pottawatomie, OK

5910 Olympia, WA ..... 1.0901 1.0609

Thurston, WA

5920 Omaha, NE–IA .. 0.9421 0.9600

Pottawattamie, IA

Cass, NE

Douglas, NE

Sarpy, NE

Washington, NE

59451Orange County,

CA .............................. 1.1532 1.1025

Orange, CA

59601Orlando, FL ......... 0.9397 0.9583

Lake, FL

Orange, FL

Osceola, FL

Seminole, FL

59902Owensboro, KY ... 0.7772 0.8415

Daviess, KY

60152Panama City, FL 0.8838 0.9189

Bay, FL

60202Parkersburg-Marietta, WV–OH (West

Virginia Hospitals) ..... 0.8046 0.8617

Washington, OH

Wood, WV

60202Parkersburg-Marietta, WV–OH (Ohio

Hospitals) ................... 0.8434 0.8899

TABLE 4A.—WAGE INDEX AND CAPITAL

GEOGRAPHIC ADJUSTMENT FACTOR

(GAF) FOR URBAN AREAS—Continued

Urban Area (Constituent

Counties)

Wage

index GAF

Washington, OH

Wood, WV

60802Pensacola, FL ..... 0.8838 0.9189

Escambia, FL

Santa Rosa, FL

6120 Peoria-Pekin, IL 0.8586 0.9009

Peoria, IL

Tazewell, IL

Woodford, IL

61601Philadelphia, PA–

NJ .............................. 1.1379 1.0925

Burlington, NJ

Camden, NJ

Gloucester, NJ

Salem, NJ

Bucks, PA

Chester, PA

Delaware, PA

Montgomery, PA

Philadelphia, PA

62001Phoenix-Mesa,

AZ .............................. 0.9606 0.9728

Maricopa, AZ

Pinal, AZ

6240 Pine Bluff, AR .... 0.7826 0.8455

Jefferson, AR

62801Pittsburgh, PA ..... 0.9725 0.9811

Allegheny, PA

Beaver, PA

Butler, PA

Fayette, PA

Washington, PA

Westmoreland, PA

6323 Pittsfield, MA ..... 1.0960 1.0648

Berkshire, MA

6340 Pocatello, ID ...... 0.9586 0.9715

Bannock, ID

6360 Ponce, PR ......... 0.4589 0.5866

Guayanilla, PR

Juana Diaz, PR

Penuelas, PR

Ponce, PR

Villalba, PR

Yauco, PR

6403 Portland, ME ...... 0.9627 0.9743

Cumberland, ME

Sagadahoc, ME

York, ME

64401Portland-Vancouver, OR–WA ........ 1.1344 1.0902

Clackamas, OR

Columbia, OR

Multnomah, OR

Washington, OR

Yamhill, OR

Clark, WA

64831Providence-Warwick-Pawtucket, RI .... 1.1049 1.0707

Bristol, RI

Kent, RI

Newport, RI

Providence, RI

Washington, RI

6520 Provo-Orem, UT 1.0073 1.0050

Utah, UT

6560 Pueblo, CO ........ 0.8450 0.8911

Pueblo, CO
Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations 46075

TABLE 4A.—WAGE INDEX AND CAPITAL

GEOGRAPHIC ADJUSTMENT FACTOR

(GAF) FOR URBAN AREAS—Continued

Urban Area (Constituent

Counties)

Wage

index GAF

65802Punta Gorda, FL 0.8838 0.9189

Charlotte, FL

6600 Racine, WI ......... 0.8934 0.9257

Racine, WI

66401 Raleigh-DurhamChapel Hill, NC .......... 0.9818 0.9875

Chatham, NC

Durham, NC

Franklin, NC

Johnston, NC

Orange, NC

Wake, NC

6660 Rapid City, SD ... 0.8345 0.8835

Pennington, SD

6680 Reading, PA ...... 0.9516 0.9666

Berks, PA

6690 Redding, CA ...... 1.1790 1.1194

Shasta, CA

6720 Reno, NV ........... 1.0768 1.0520

Washoe, NV

67402 RichlandKennewick-Pasco,

WA ............................. 1.0221 1.0151

Benton, WA

Franklin, WA

6760 Richmond-Petersburg, VA .............. 0.9152 0.9411

Charles City County,

VA

Chesterfield, VA

Colonial Heights City,

VA

Dinwiddie, VA

Goochland, VA

Hanover, VA

Henrico, VA

Hopewell City, VA

New Kent, VA

Petersburg City, VA

Powhatan, VA

Prince George, VA

Richmond City, VA

6780 1 Riverside-San

Bernardino, CA .......... 1.1145 1.0771

Riverside, CA

San Bernardino, CA

6800 Roanoke, VA ..... 0.8402 0.8876

Botetourt, VA

Roanoke, VA

Roanoke City, VA

Salem City, VA

6820 Rochester, MN .. 1.0502 1.0341

Olmsted, MN

6840 1 Rochester, NY 0.9524 0.9672

Genesee, NY

Livingston, NY

Monroe, NY

Ontario, NY

Orleans, NY

Wayne, NY

6880 Rockford, IL ....... 0.9081 0.9361

Boone, IL

Ogle, IL

Winnebago, IL

6895 Rocky Mount,

NC ............................. 0.9029 0.9324

Edgecombe, NC

TABLE 4A.—WAGE INDEX AND CAPITAL

GEOGRAPHIC ADJUSTMENT FACTOR

(GAF) FOR URBAN AREAS—Continued

Urban Area (Constituent

Counties)

Wage

index GAF

Nash, NC

6920 1Sacramento,

CA .............................. 1.2202 1.1460

El Dorado, CA

Placer, CA

Sacramento, CA

6960 Saginaw-Bay

City-Midland, MI ........ 0.9564 0.9699

Bay, MI

Midland, MI

Saginaw, MI

6980 St. Cloud, MN .... 0.9544 0.9685

Benton, MN

Stearns, MN

7000 St. Joseph, MO 0.8366 0.8850

Andrew, MO

Buchanan, MO

7040 1St. Louis, MO–

IL ................................ 0.9130 0.9396

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 2Salem, OR ....... 0.9976 0.9984

Marion, OR

Polk, OR

7120 Salinas, CA ........ 1.4513 1.2905

Monterey, CA

71601Salt Lake CityOgden, UT ................. 0.9862 0.9905

Davis, UT

Salt Lake, UT

Weber, UT

7200 San Angelo, TX 0.7780 0.8421

Tom Green, TX

7240 1San Antonio,

TX .............................. 0.8499 0.8946

Bexar, TX

Comal, TX

Guadalupe, TX

Wilson, TX

7320 1San Diego, CA 1.2225 1.1475

San Diego, CA

7360 1San Francisco,

CA .............................. 1.4091 1.2647

Marin, CA

San Francisco, CA

San Mateo, CA

7400 1San Jose, CA .. 1.4332 1.2795

Santa Clara, CA

7440 1San Juan-Bayamon, PR .................... 0.4618 0.5891

Aguas Buenas, PR

Barceloneta, PR

Bayamon, PR

Canovanas, PR

Carolina, PR

Catano, PR

Ceiba, PR

TABLE 4A.—WAGE INDEX AND CAPITAL

GEOGRAPHIC ADJUSTMENT FACTOR

(GAF) FOR URBAN AREAS—Continued

Urban Area (Constituent

Counties)

Wage

index GAF

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

Robles, CA ................ 1.1374 1.0922

San Luis Obispo, CA

7480 Santa BarbaraSanta Maria-Lompoc,

CA .............................. 1.0688 1.0466

Santa Barbara, CA

7485 Santa CruzWatsonville, CA ......... 1.4187 1.2706

Santa Cruz, CA

7490 Santa Fe, NM .... 1.0332 1.0226

Los Alamos, NM

Santa Fe, NM

7500 Santa Rosa, CA 1.2267 1.1502

Sonoma, CA

7510 Sarasota-Bradenton, FL ................. 0.9757 0.9833

Manatee, FL

Sarasota, FL

7520 Savannah, GA ... 0.8638 0.9046

Bryan, GA

Chatham, GA

Effingham, GA

7560 Scranton—

Wilkes-Barre—Hazleton, PA ....................... 0.8539 0.8975

Columbia, PA

Lackawanna, PA

Luzerne, PA

Wyoming, PA

7600 1Seattle-Bellevue-Everett, WA ........ 1.1375 1.0922

Island, WA

King, WA

Snohomish, WA

7610 Sharon, PA ........ 0.8783 0.9150

Mercer, PA

7620 2Sheboygan, WI 0.8471 0.8926

Sheboygan, WI

7640 ShermanDenison, TX ............... 0.8499 0.8946

Grayson, TX

7680 Shreveport-Bossier City, LA ............... 0.9381 0.9572
46076 Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations

TABLE 4A.—WAGE INDEX AND CAPITAL

GEOGRAPHIC ADJUSTMENT FACTOR

(GAF) FOR URBAN AREAS—Continued

Urban Area (Constituent

Counties)

Wage

index GAF

Bossier, LA

Caddo, LA

Webster, LA

7720 Sioux City, IA–

NE .............................. 0.8031 0.8606

Woodbury, IA

Dakota, NE

7760 Sioux Falls, SD .. 0.8712 0.9099

Lincoln, SD

Minnehaha, SD

7800 South Bend, IN .. 0.9880 0.9918

St. Joseph, IN

7840 Spokane, WA .... 1.0486 1.0330

Spokane, WA

7880 Springfield, IL .... 0.8713 0.9100

Menard, IL

Sangamon, IL

7920 Springfield, MO .. 0.8036 0.8609

Christian, MO

Greene, MO

Webster, MO

8003 2Springfield, MA 1.0718 1.0486

Hampden, MA

Hampshire, MA

8050 State College,

PA .............................. 0.9635 0.9749

Centre, PA

8080 SteubenvilleWeirton, OH–WV ....... 0.8645 0.9051

Jefferson, OH

Brooke, WV

Hancock, WV

8120 Stockton-Lodi,

CA .............................. 1.1518 1.1016

San Joaquin, CA

8140 2Sumter, SC ...... 0.7921 0.8525

Sumter, SC

8160 Syracuse, NY .... 0.9480 0.9641

Cayuga, NY

Madison, NY

Onondaga, NY

Oswego, NY

8200 Tacoma, WA ...... 1.1016 1.0685

Pierce, WA

8240 2Tallahassee, FL 0.8838 0.9189

Gadsden, FL

Leon, FL

8280 1Tampa-St. Petersburg-Clearwater,

FL .............................. 0.9196 0.9442

Hernando, FL

Hillsborough, FL

Pasco, FL

Pinellas, FL

8320 Terre Haute, IN 0.8614 0.9029

Clay, IN

Vermillion, IN

Vigo, IN

8360 Texarkana, ARTexarkana, TX ........... 0.8699 0.9090

Miller, AR

Bowie, TX

8400 Toledo, OH ........ 1.0140 1.0096

Fulton, OH

Lucas, OH

Wood, OH

8440 Topeka, KS ........ 0.9438 0.9612

TABLE 4A.—WAGE INDEX AND CAPITAL

GEOGRAPHIC ADJUSTMENT FACTOR

(GAF) FOR URBAN AREAS—Continued

Urban Area (Constituent

Counties)

Wage

index GAF

Shawnee, KS

8480 Trenton, NJ ........ 1.0380 1.0259

Mercer, NJ

8520 Tucson, AZ ........ 0.9180 0.9431

Pima, AZ

8560 Tulsa, OK .......... 0.8074 0.8637

Creek, OK

Osage, OK

Rogers, OK

Tulsa, OK

Wagoner, OK

8600 Tuscaloosa, AL .. 0.8187 0.8720

Tuscaloosa, AL

8640 Tyler, TX ............ 0.9567 0.9701

Smith, TX

8680 2 Utica-Rome,

NY .............................. 0.8401 0.8875

Herkimer, NY

Oneida, NY

8720 Vallejo-FairfieldNapa, CA ................... 1.3528 1.2299

Napa, CA

Solano, CA

8735 Ventura, CA ....... 1.0544 1.0369

Ventura, CA

8750 Victoria, TX ........ 0.8474 0.8928

Victoria, TX

8760 Vineland-MillvilleBridgeton, NJ ............. 1.0110 1.0075

Cumberland, NJ

8780 2Visalia-TularePorterville, CA ........... 0.9977 0.9984

Tulare, CA

8800 Waco, TX ........... 0.7696 0.8358

McLennan, TX

8840 1Washington,

DC–MD–VA–WV ....... 1.0780 1.0528

District of Columbia,

DC

Calvert, MD

Charles, MD

Frederick, MD

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 ..................... 0.8643 0.9050

TABLE 4A.—WAGE INDEX AND CAPITAL

GEOGRAPHIC ADJUSTMENT FACTOR

(GAF) FOR URBAN AREAS—Continued

Urban Area (Constituent

Counties)

Wage

index GAF

Black Hawk, IA

8940 Wausau, WI ....... 1.0545 1.0370

Marathon, WI

8960 West Palm

Beach-Boca Raton,

FL .............................. 1.0309 1.0211

Palm Beach, FL

9000 2Wheeling, OH–

WV (West Virginia

Hospitals) ................... 0.7966 0.8558

Belmont, OH

Marshall, WV

Ohio, WV

9000 2Wheeling, OH–

WV (Ohio Hospitals) .. 0.8434 0.8899

Belmont, OH

Marshall, WV

Ohio, WV

9040 Wichita, KS ........ 0.9403 0.9587

Butler, KS

Harvey, KS

Sedgwick, KS

9080 Wichita Falls, TX 0.7646 0.8321

Archer, TX

Wichita, TX

9140 Williamsport, PA 0.8548 0.8981

Lycoming, PA

9160 Wilmington-Newark, DE–MD ............... 1.1538 1.1029

New Castle, DE

Cecil, MD

9200 Wilmington, NC 0.9322 0.9531

New Hanover, NC

Brunswick, NC

9260 2Yakima, WA .... 1.0221 1.0151

Yakima, WA

9270 Yolo, CA ............ 1.1431 1.0959

Yolo, CA

9280 York, PA ............ 0.9415 0.9596

York, PA

9320 YoungstownWarren, OH ............... 0.9937 0.9957

Columbiana, OH

Mahoning, OH

Trumbull, OH

9340 Yuba City, CA .... 1.0324 1.0221

Sutter, CA

Yuba, CA

9360 Yuma, AZ .......... 0.9732 0.9816

Yuma, AZ

1 Large Urban Area

2 Hospitals geographically located in the

area are assigned the statewide rural wage

index for FY 1998.

TABLE 4B.—WAGE INDEX AND CAPITAL

GEOGRAPHIC ADJUSTMENT FACTOR

(GAF) FOR RURAL AREAS

Nonurban area Wage

index GAF

Alabama ........................ 0.7260 0.8031

Alaska ........................... 1.2302 1.1524

Arizona .......................... 0.7989 0.8575

Arkansas ....................... 0.6995 0.7829
Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations 46077

TABLE 4B.—WAGE INDEX AND CAPITAL

GEOGRAPHIC ADJUSTMENT FACTOR

(GAF) FOR RURAL AREAS—Continued

Nonurban area Wage

index GAF

California ....................... 0.9977 0.9984

Colorado ........................ 0.8129 0.8677

Connecticut ................... 1.2617 1.1726

Delaware ....................... 0.8925 0.9251

Florida ........................... 0.8838 0.9189

Georgia ......................... 0.7761 0.8407

Hawaii ........................... 1.0229 1.0156

Idaho ............................. 0.8221 0.8745

Illinois ............................ 0.7644 0.8320

Indiana .......................... 0.8161 0.8701

Iowa ............................... 0.7391 0.8130

Kansas .......................... 0.7203 0.7988

Kentucky ....................... 0.7772 0.8415

Louisiana ....................... 0.7383 0.8124

Maine ............................ 0.8468 0.8924

Maryland ....................... 0.8617 0.9031

Massachusetts .............. 1.0718 1.0486

Michigan ........................ 0.8923 0.9249

Minnesota ...................... 0.8180 0.8715

Mississippi ..................... 0.6911 0.7765

Missouri ......................... 0.7207 0.7991

Montana ........................ 0.8302 0.8804

Nebraska ....................... 0.7401 0.8137

Nevada .......................... 0.8914 0.9243

New Hampshire ............ 0.9724 0.9810

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

New Mexico .................. 0.8110 0.8664

New York ...................... 0.8401 0.8875

North Carolina ............... 0.7939 0.8538

North Dakota ................. 0.7360 0.8107

Ohio ............................... 0.8434 0.8899

Oklahoma ...................... 0.7072 0.7888

Oregon .......................... 0.9976 0.9984

Pennsylvania ................. 0.8421 0.8890

Puerto Rico ................... 0.4224 0.5542

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

South Carolina .............. 0.7921 0.8525

South Dakota ................ 0.6983 0.7820

Tennessee .................... 0.7353 0.8101

Texas ............................ 0.7404 0.8140

Utah ............................... 0.8926 0.9251

Vermont ......................... 0.9314 0.9525

Virginia .......................... 0.7782 0.8422

Washington ................... 1.0221 1.0151

West Virginia ................. 0.7966 0.8558

Wisconsin ...................... 0.8471 0.8926

Wyoming ....................... 0.8247 0.8764

1All counties within the State are classified

as urban.

TABLE 4C.—WAGE INDEX AND CAPITAL GEOGRAPHIC ADJUSTMENT

FACTOR (GAF) FOR HOSPITALS

THAT ARE RECLASSIFIED

Urban area Wage

index GAF

Abilene, TX ................... 0.8287 0.8793

Albuquerque, NM .......... 0.9329 0.9535

Alexandria, LA ............... 0.8269 0.8780

Amarillo, TX .................. 0.9277 0.9499

Anchorage, AK .............. 1.2998 1.1967

Asheville, NC ................ 0.9072 0.9355

Athens, GA .................... 0.9087 0.9365

Atlanta, GA .................... 0.9823 0.9878

TABLE 4C.—WAGE INDEX AND CAPITAL GEOGRAPHIC ADJUSTMENT

FACTOR (GAF) FOR HOSPITALS

THAT ARE RECLASSIFIED—Continued

Urban area Wage

index GAF

Austin-San Marcos, TX 0.9133 0.9398

Bangor, ME ................... 0.9478 0.9640

Barnstable-Yarmouth,

MA ............................. 1.3827 1.2484

Baton Rouge, LA .......... 0.8382 0.8862

Benton Harbor, MI ........ 0.8923 0.9249

Bergen-Passaic, NJ ...... 1.1570 1.1050

Billings, MT ................... 0.9609 0.9731

Birmingham, AL ............ 0.9005 0.9307

Bismarck, ND ................ 0.7859 0.8479

Boise City, ID ................ 0.8887 0.9224

Boston-Worcester-Lawrence-Lowell-Brockton, MA–NH ............... 1.1436 1.0962

Caguas, PR ................... 0.4508 0.5795

Casper, WY ................... 0.9013 0.9313

Champaign-Urbana, IL .. 0.8706 0.9095

Charlotte-Gastonia-Rock

Hill, NC–SC ............... 0.9710 0.9800

Charlottesville, VA ......... 0.8885 0.9222

Chattanooga, TN-GA .... 0.8658 0.9060

Chicago, IL .................... 1.0759 1.0514

Cincinnati, OH–KY–IN .. 0.9521 0.9669

Cleveland-Lorain-Elyria,

OH ............................. 0.9804 0.9865

Columbia, MO ............... 0.8759 0.9133

Columbus, OH .............. 0.9793 0.9858

Dallas, TX ..................... 0.9674 0.9776

Davenport-Moline-Rock

Island, IA–IL .............. 0.8405 0.8878

Denver, CO ................... 1.0386 1.0263

Des Moines, IA ............. 0.8837 0.9188

Detroit, MI ..................... 1.0840 1.0568

Duluth-Superior, MN–WI 0.9779 0.9848

Dutchess County, NY ... 1.0364 1.0248

Eugene-Springfield, OR 1.1659 1.1108

Fargo-Moorhead, ND–

MN ............................. 0.8729 0.9111

Fayetteville, NC ............. 0.8491 0.8940

Flint, MI ......................... 1.1171 1.0788

Florence, AL .................. 0.7716 0.8373

Florence, SC ................. 0.8711 0.9098

Ft. Lauderdale, FL ........ 1.0487 1.0331

Fort Pierce-Port St.

Lucie, FL .................... 1.0008 1.0005

Fort Walton Beach, FL .. 0.8653 0.9057

Forth Worth-Arlington,

TX .............................. 0.9997 0.9998

Gadsden, AL ................. 0.8815 0.9173

Gainesville, FL .............. 0.9616 0.9735

Gary, IN ......................... 0.9114 0.9384

Grand Forks, ND–MN ... 0.8815 0.9173

Grand Junction, CO ...... 0.9491 0.9649

Great Falls, MT ............. 0.9306 0.9519

Greeley, CO .................. 0.9791 0.9856

Green Bay, WI .............. 0.9585 0.9714

Greensboro-WinstonSalem-High Point, NC 0.9351 0.9551

Harrisburg-LebanonCarlisle, PA ................ 1.0076 1.0052

Honolulu, HI .................. 1.1817 1.1211

Houma, LA .................... 0.7854 0.8475

Houston, TX .................. 0.9855 0.9900

Huntington-Ashland,

WV–KY–OH ............... 0.9160 0.9417

Huntsville, AL ................ 0.8485 0.8936

TABLE 4C.—WAGE INDEX AND CAPITAL GEOGRAPHIC ADJUSTMENT

FACTOR (GAF) FOR HOSPITALS

THAT ARE RECLASSIFIED—Continued

Urban area Wage

index GAF

Indianapolis, IN ............. 0.9848 0.9896

Iowa City, IA .................. 0.9198 0.9444

Jackson, MS ................. 0.7790 0.8428

Johnson City-KingsportBristol, TN–VA ........... 0.9114 0.9384

Jonesboro, AR .............. 0.7443 0.8169

Joplin, MO ..................... 0.7541 0.8243

Kalamazoo-Battlecreek,

MI ............................... 1.0668 1.0453

Kansas City, KS–MO .... 0.9564 0.9699

Knoxville, TN ................. 0.8831 0.9184

Lafayette, LA ................. 0.8227 0.8749

Lafayette, IN .................. 0.9174 0.9427

Lansing-East Lansing,

MI ............................... 1.0088 1.0060

Las Cruces, NM ............ 0.8658 0.9060

Las Vegas, NV–AZ ....... 1.0592 1.0402

Lexington, KY ................ 0.8416 0.8886

Lima, OH ....................... 0.9185 0.9434

Lincoln, NE .................... 0.9035 0.9329

Little Rock-North Little

Rock, AR ................... 0.8490 0.8940

Longview-Marshall, TX 0.8509 0.8953

Los Angeles-Long

Beach, CA ................. 1.2268 1.1503

Louisville, KY–IN ........... 0.9507 0.9660

Macon, GA .................... 0.9227 0.9464

Madison, WI .................. 1.0055 1.0038

Mansfield, OH ............... 0.8639 0.9047

Medford-Ashland, OR ... 1.0354 1.0241

Memphis, TN–AR–MS .. 0.8589 0.9011

Milwaukee-Waukesha,

WI .............................. 0.9819 0.9876

Minneapolis-St. Paul,

MN–WI ....................... 1.0733 1.0496

Monroe, LA ................... 0.8414 0.8885

Montgomery, AL ............ 0.7813 0.8445

Nashville, TN ................. 0.9182 0.9432

New Haven-BridgeportStamford-WaterburyDanbury, CT .............. 1.2619 1.1727

New London-Norwich,

CT .............................. 1.2258 1.1496

New Orleans, LA ........... 0.9566 0.9701

New York, NY ............... 1.3982 1.2580

Newark, NJ ................... 1.1111 1.0748

Newburgh, NY–PA ........ 1.1283 1.0862

Oakland, CA .................. 1.5158 1.3295

Odessa-Midland, TX ..... 0.8516 0.8958

Oklahoma City, OK ....... 0.8481 0.8933

Omaha, NE–IA .............. 0.9421 0.9600

Orange County, CA ...... 1.1532 1.1025

Peoria-Pekin, IL ............ 0.8586 0.9009

Philadelphia, PA–NJ ..... 1.1379 1.0925

Pittsburgh, PA ............... 0.9583 0.9713

Pocatello, ID .................. 0.9000 0.9304

Portland, ME ................. 0.9627 0.9743

Portland-Vancouver,

OR–WA ..................... 1.1344 1.0902

Provo-Orem, UT ............ 1.0073 1.0050

Raleigh-Durham-Chapel

Hill, NC ...................... 0.9818 0.9875

Rapid City, SD .............. 0.8345 0.8835

Rochester, MN .............. 1.0502 1.0341

Rockford, IL ................... 0.9081 0.9361

Sacramento, CA ............ 1.2202 1.1460
46078 Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations

TABLE 4C.—WAGE INDEX AND CAPITAL GEOGRAPHIC ADJUSTMENT

FACTOR (GAF) FOR HOSPITALS

THAT ARE RECLASSIFIED—Continued

Urban area Wage

index GAF

Saginaw-Bay City-Midland, MI ...................... 0.9564 0.9699

St. Cloud, MN ............... 0.9544 0.9685

St. Louis, MO–IL ........... 0.9130 0.9396

Salinas, CA ................... 1.4299 1.2775

Salt Lake City-Ogden,

UT .............................. 0.9862 0.9905

San Diego, CA .............. 1.2225 1.1475

San Francisco, CA ........ 1.4091 1.2647

Santa Fe, NM ................ 1.0007 1.0005

Santa Rosa, CA ............ 1.2146 1.1424

Seattle-Bellevue-Everett,

WA ............................. 1.1375 1.0922

Sherman-Denison, TX .. 0.8324 0.8819

Sioux City, IA–NE ......... 0.8031 0.8606

Sioux Falls, SD ............. 0.8607 0.9024

South Bend, IN ............. 0.9880 0.9918

Spokane, WA ................ 1.0311 1.0212

Springfield, IL ................ 0.8610 0.9026

Springfield, MO ............. 0.8036 0.8609

Stockton-Lodi, CA ......... 1.1518 1.1016

Syracuse, NY ................ 0.9480 0.9641

Tampa-St. PetersburgClearwater, FL ........... 0.9196 0.9442

Texarkana, AR-Texarkana, TX ................. 0.8699 0.9090

Topeka, KS ................... 0.9310 0.9522

Tucson, AZ .................... 0.9180 0.9431

Tulsa, OK ...................... 0.8074 0.8637

Tyler, TX ....................... 0.9421 0.9600

Vallejo-Fairfield-Napa,

CA .............................. 1.3528 1.2299

Washington, DC–MD–

VA–WV ...................... 1.0780 1.0528

Waterloo-Cedar Falls, IA 0.8643 0.9050

Wausau, WI .................. 0.9845 0.9894

Wichita, KS ................... 0.9157 0.9415

Wichita Falls, TX ........... 0.7646 0.8321

Rural Florida ................. 0.8838 0.9189

Rural Louisiana ............. 0.7383 0.8124

Rural Minnesota ............ 0.8180 0.8715

Rural Missouri ............... 0.7207 0.7991

Rural New Hampshire ... 0.9724 0.9810

Rural New Mexico ......... 0.8110 0.8664

Rural North Carolina ..... 0.7939 0.8538

Rural Oregon ................ 0.9976 0.9984

Rural Washington ......... 1.0221 1.0151

Rural West Virginia ....... 0.7966 0.8558

Rural Wyoming ............. 0.8247 0.8764

TABLE 4D.—AVERAGE HOURLY WAGE

FOR URBAN AREAS

Urban area

Average

hourly

wage

Abilene, TX ................................... 16.6537

Aguadilla, PR ................................ 8.4161

Akron, OH ..................................... 19.6368

Albany, GA .................................... 15.9028

Albany-Schenectady-Troy, NY ..... 17.0398

Albuquerque, NM .......................... 18.7069

Alexandria, LA .............................. 16.4017

Allentown-Bethlehem-Easton, PA 20.2671

TABLE 4D.—AVERAGE HOURLY WAGE

FOR URBAN AREAS—Continued

Urban area

Average

hourly

wage

Altoona, PA ................................... 18.3612

Amarillo, TX .................................. 18.9399

Anchorage, AK .............................. 25.8065

Ann Arbor, MI ............................... 23.6829

Anniston, AL ................................. 16.6112

Appleton-Oshkosh-Neenah, WI .... 18.0782

Arecibo, PR ................................... 8.4753

Asheville, NC ................................ 18.2293

Athens, GA ................................... 18.2596

Atlanta, GA ................................... 19.7400

Atlantic-Cape May, NJ .................. 22.4152

Augusta-Aiken, GA–SC ................ 18.7555

Austin-San Marcos, TX ................. 18.3520

Bakersfield, CA ............................. 20.1222

Baltimore, MD ............................... 19.4693

Bangor, ME ................................... 19.0461

Barnstable-Yarmouth, MA ............ 28.7181

Baton Rouge, LA .......................... 16.8431

Beaumont-Port Arthur, TX ............ 17.2676

Bellingham, WA ............................ 22.5492

Benton Harbor, MI ........................ 17.3503

Bergen-Passaic, NJ ...................... 24.4277

Billings, MT ................................... 19.6586

Biloxi-Gulfport-Pascagoula, MS .... 16.9110

Binghamton, NY ............................ 17.9128

Birmingham, AL ............................ 18.0953

Bismarck, ND ................................ 15.4640

Bloomington, IN ............................ 18.3421

Bloomington-Normal, IL ................ 17.5497

Boise City, ID ................................ 17.7955

Boston-Worcester-Lawrence-Lowell-Brockton, MA–NH ................. 22.9992

Boulder-Longmont, CO ................. 20.1260

Brazoria, TX .................................. 18.7704

Bremerton, WA ............................. 22.1033

Brownsville-Harlingen-San Benito,

TX .............................................. 17.5624

Bryan-College Station, TX ............ 17.2226

Buffalo-Niagara Falls, NY ............. 18.6331

Burlington, VT ............................... 20.3813

Caguas, PR .................................. 8.9610

Canton-Massillon, OH ................... 18.0078

Casper, WY .................................. 18.1110

Cedar Rapids, IA .......................... 17.1383

Champaign-Urbana, IL ................. 17.7326

Charleston-North Charleston, SC 17.6972

Charleston, WV ............................. 18.3703

Charlotte-Gastonia-Rock Hill, NC–

SC ............................................. 19.5119

Charlottesville, VA ........................ 18.1882

Chattanooga, TN–GA ................... 17.3976

Cheyenne, WY .............................. 15.1808

Chicago, IL .................................... 21.8239

Chico-Paradise, CA ...................... 20.9567

Cincinnati, OH–KY–IN .................. 19.0379

Clarksville-Hopkinsville, TN–KY ... 15.7785

Cleveland-Lorain-Elyria, OH ......... 19.7003

Colorado Springs, CO .................. 18.7205

Columbia, MO ............................... 18.0868

Columbia, SC ................................ 18.4707

Columbus, GA–AL ........................ 16.6542

Columbus, OH .............................. 19.6781

Corpus Christi, TX ........................ 17.9745

Cumberland, MD–WV ................... 17.7280

Dallas, TX ..................................... 19.4990

Danville, VA .................................. 16.3692

Davenport-Moline-Rock Island,

IA–IL .......................................... 16.8903

Dayton-Springfield, OH ................. 19.2596

TABLE 4D.—AVERAGE HOURLY WAGE

FOR URBAN AREAS—Continued

Urban area

Average

hourly

wage

Daytona Beach, FL ....................... 16.8298

Decatur, AL ................................... 16.6503

Decatur, IL .................................... 15.9047

Denver, CO ................................... 20.8698

Des Moines, IA ............................. 17.7579

Detroit, MI ..................................... 21.7532

Dothan, AL .................................... 16.2160

Dover, DE ..................................... 18.6953

Dubuque, IA .................................. 16.2530

Duluth-Superior, MN–WI ............... 19.6500

Dutchess County, NY ................... 21.3657

Eau Claire, WI .............................. 17.6122

El Paso, TX ................................... 20.3430

Elkhart-Goshen, IN ....................... 18.2474

Elmira, NY ..................................... 16.5714

Enid, OK ....................................... 16.0002

Erie, PA ......................................... 17.8087

Eugene-Springfield, OR ................ 22.9777

Evansville, Henderson, IN–KY ..... 17.3648

Fargo-Moorhead, ND–MN ............ 17.7585

Fayetteville, NC ............................ 17.5510

Fayetteville-Springdale-Rogers,

AR ............................................. 14.9924

Flagstaff, AZ–UT ........................... 18.3168

Flint, MI ......................................... 22.4472

Florence, AL ................................. 15.1732

Florence, SC ................................. 17.5055

Fort Collins-Loveland, CO ............ 20.5933

Fort Lauderdale, FL ...................... 20.9943

Fort Myers-Cape Coral, FL ........... 17.6604

Fort Pierce-Port St. Lucie, FL ....... 20.6112

Fort Smith, AR–OK ....................... 15.6127

Fort Walton Beach, FL ................. 17.6128

Fort Wayne, IN ............................. 17.8865

Fort Worth-Arlington, TX ............... 20.0524

Fresno, CA .................................... 21.3156

Gadsden, AL ................................. 17.7134

Gainesville, FL .............................. 19.3227

Galveston-Texas City, TX ............. 21.2286

Gary, IN ........................................ 19.3581

Glens Falls, NY ............................. 16.8524

Goldsboro, NC .............................. 16.9659

Grand Forks, ND–MN ................... 17.5737

Grand Junction, CO ...................... 18.2668

Grand Rapids-Muskegon-Holland,

MI .............................................. 20.3894

Great Falls, MT ............................. 17.6888

Greeley, CO .................................. 20.2891

Green Bay, WI .............................. 18.2802

Greensboro-Winston-Salem-High

Point, NC ................................... 18.7911

Greenville, NC .............................. 18.2150

Greenville-Spartanburg-Anderson,

SC ............................................. 18.2047

Hagerstown, MD ........................... 19.4546

Hamilton-Middletown, OH ............. 17.6176

Harrisburg-Lebanon-Carlisle, PA .. 20.4715

Hartford, CT .................................. 25.2442

Hattiesburg, MS ............................ 14.4517

Hickory-Morganton-Lenoir, NC ..... 17.4555

Honolulu, HI .................................. 23.7434

Houma, LA .................................... 15.7820

Houston, TX .................................. 19.8028

Huntington-Ashland, WV–KY–OH 18.4061

Huntsville, AL ................................ 17.0504

Indianapolis, IN ............................. 19.7891

Iowa City, IA ................................. 18.8914

Jackson, MI ................................... 18.1893

Jackson, MS ................................. 15.5941
Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations 46079

TABLE 4D.—AVERAGE HOURLY WAGE

FOR URBAN AREAS—Continued

Urban area

Average

hourly

wage

Jackson, TN .................................. 17.1259

Jacksonville, FL ............................ 18.0231

Jacksonville, NC ........................... 14.0121

Jamestown, NY ............................. 15.1763

Janesville-Beloit, WI ..................... 17.7327

Jersey City, NJ ............................. 22.9317

Johnson City-Kingsport-Bristol,

TN–VA ....................................... 18.3137

Johnstown, PA .............................. 16.8349

Jonesboro, AR .............................. 14.9575

Joplin, MO ..................................... 15.0911

Kalamazoo-Battlecreek, MI ........... 21.4383

Kankakee, IL ................................. 17.3875

Kansas City, KS–MO .................... 19.2182

Kenosha, WI ................................. 18.4799

Killeen-Temple, TX ....................... 20.6010

Knoxville, TN ................................. 17.7457

Kokomo, IN ................................... 16.9123

La Crosse, WI–MN ....................... 17.5812

Lafayette, LA ................................. 16.4896

Lafayette, IN ................................. 18.4349

Lake Charles, LA .......................... 15.6250

Lakeland-Winter Haven, FL .......... 17.6957

Lancaster, PA ............................... 19.0528

Lansing-East Lansing, MI ............. 20.2720

Laredo, TX .................................... 14.7188

Las Cruces, NM ............................ 17.3739

Las Vegas, NV–AZ ....................... 21.2843

Lawrence, KS ............................... 17.2986

Lawton, OK ................................... 18.1767

Lewiston-Auburn, ME ................... 19.1630

Lexington, KY ............................... 16.8604

Lima, OH ....................................... 18.4571

Lincoln, NE ................................... 18.5501

Little Rock-North Little Rock, AR .. 17.0606

Longview-Marshall, TX ................. 17.3073

Los Angeles-Long Beach, CA ...... 24.5811

Louisville, KY–IN ........................... 19.1041

Lubbock, TX .................................. 16.8801

Lynchburg, VA .............................. 16.5342

Macon, GA .................................... 18.5414

Madison, WI .................................. 20.2048

Mansfield, OH ............................... 17.3603

Mayaguez, PR .............................. 8.9928

McAllen-Edinburg-Mission, TX ..... 16.8206

Medford-Ashland, OR ................... 20.8059

Melbourne-Titusville-Palm Bay, FL 17.7216

Memphis, TN–AR–MS .................. 17.2589

Merced, CA ................................... 21.9978

Miami, FL ...................................... 19.8109

Middlesex-Somerset-Hunterdon,

NJ .............................................. 22.2234

Milwaukee-Waukesha, WI ............ 19.7306

Minneapolis-St. Paul, MN–WI ....... 21.5680

Mobile, AL ..................................... 16.9905

Modesto, CA ................................. 21.6914

Monmouth-Ocean, NJ ................... 21.9716

Monroe, LA ................................... 16.9075

Montgomery, AL ........................... 15.4155

Muncie, IN ..................................... 18.4325

Myrtle Beach, SC .......................... 16.2206

Naples, FL .................................... 20.3132

Nashville, TN ................................ 18.4503

Nassau-Suffolk, NY ...................... 27.7455

New Haven-Bridgeport-StamfordWaterbury-Danbury, CT ............ 25.3561

New London-Norwich, CT ............ 24.1396

New Orleans, LA .......................... 19.2230

New York, NY ............................... 28.1700

TABLE 4D.—AVERAGE HOURLY WAGE

FOR URBAN AREAS—Continued

Urban area

Average

hourly

wage

Newark, NJ ................................... 24.0742

Newburgh, NY–PA ........................ 22.6737

Norfolk-Virginia Beach-Newport

News, VA–NC ........................... 16.7115

Oakland, CA ................................. 30.2802

Ocala, FL ...................................... 18.1497

Odessa-Midland, TX ..................... 17.4016

Oklahoma City, OK ....................... 17.0417

Olympia, WA ................................. 21.9051

Omaha, NE–IA .............................. 18.9312

Orange County, CA ...................... 23.3199

Orlando, FL ................................... 18.8833

Owensboro, KY ............................. 15.0313

Panama City, FL ........................... 16.7539

Parkersburg-Marietta, WV–OH ..... 16.1677

Pensacola, FL ............................... 16.4635

Peoria-Pekin, IL ............................ 17.2543

Philadelphia, PA–NJ ..................... 22.8669

Phoenix-Mesa, AZ ........................ 19.3025

Pine Bluff, AR ............................... 15.7267

Pittsburgh, PA ............................... 19.5430

Pittsfield, MA ................................. 22.0237

Pocatello, ID ................................. 19.2628

Ponce, PR ..................................... 9.2209

Portland, ME ................................. 19.3456

Portland-Vancouver, OR–WA ....... 22.7959

Providence-Warwick, RI ............... 22.2031

Provo-Orem, UT ........................... 20.2420

Pueblo, CO ................................... 16.9797

Punta Gorda, FL ........................... 17.5323

Racine, WI .................................... 17.9536

Raleigh-Durham-Chapel Hill, NC .. 19.7297

Rapid City, SD .............................. 16.7698

Reading, PA .................................. 19.1233

Redding, CA ................................. 23.6924

Reno, NV ...................................... 21.6378

Richland-Kennewick-Pasco, WA .. 19.9294

Richmond-Petersburg, VA ............ 18.3907

Riverside-San Bernardino, CA ..... 22.7212

Roanoke, VA ................................. 16.8848

Rochester, MN .............................. 21.1030

Rochester, NY .............................. 19.1384

Rockford, IL .................................. 18.2476

Rocky Mount, NC ......................... 18.1440

Sacramento, CA ........................... 24.5203

Saginaw-Bay City-Midland, MI ..... 19.2180

St. Cloud, MN ............................... 19.1778

St. Joseph, MO ............................. 16.8108

St. Louis, MO–IL ........................... 18.3475

Salem, OR .................................... 19.9649

Salinas, CA ................................... 29.1634

Salt Lake City-Ogden, UT ............ 19.8077

San Angelo, TX ............................ 15.6340

San Antonio, TX ........................... 17.0791

San Diego, CA .............................. 24.5018

San Francisco, CA ........................ 28.4956

San Jose, CA ................................ 28.8011

San Juan-Bayamon, PR ............... 9.2790

San Luis Obispo-Atascadero-Paso

Robles, CA ................................ 22.8552

Santa Barbara-Santa MariaLompoc, CA .............................. 21.4774

Santa Cruz-Watsonville, CA ......... 28.5090

Santa Fe, NM ............................... 20.7615

Santa Rosa, CA ............................ 25.7526

Sarasota-Bradenton, FL ............... 19.6072

Savannah, GA .............................. 17.3582

Scranton-Wilkes Barre-Hazleton,

PA .............................................. 17.1601

TABLE 4D.—AVERAGE HOURLY WAGE

FOR URBAN AREAS—Continued

Urban area

Average

hourly

wage

Seattle-Bellevue-Everett, WA ....... 22.7858

Sharon, PA ................................... 17.6500

Sheboygan, WI ............................. 15.7984

Sherman-Denison, TX .................. 17.0784

Shreveport-Bossier City, LA ......... 18.8520

Sioux City, IA–NE ......................... 16.1387

Sioux Falls, SD ............................. 17.5067

South Bend, IN ............................. 19.8290

Spokane, WA ................................ 21.0721

Springfield, IL ................................ 17.5080

Springfield, MO ............................. 16.0540

Springfield, MA ............................. 21.4074

State College, PA ......................... 19.3613

Steubenville-Weirton, OH–WV ..... 17.3728

Stockton-Lodi, CA ......................... 23.1020

Sumter, SC ................................... 15.7585

Syracuse, NY ................................ 19.0186

Tacoma, WA ................................. 22.1357

Tallahassee, FL ............................ 16.7434

Tampa-St. Petersburg-Clearwater,

FL .............................................. 18.2926

Terre Haute, IN ............................. 17.3093

Texarkana, AR-Texarkana, TX ..... 17.4104

Toledo, OH ................................... 20.8792

Topeka, KS ................................... 18.9662

Trenton, NJ ................................... 20.8592

Tucson, AZ ................................... 18.4477

Tulsa, OK ...................................... 16.2252

Tuscaloosa, AL ............................. 16.4520

Tyler, TX ....................................... 19.2259

Utica-Rome, NY ............................ 16.8763

Vallejo-Fairfield-Napa, CA ............ 27.6380

Ventura, CA .................................. 21.9959

Victoria, TX ................................... 17.0294

Vineland-Millville-Bridgeton, NJ .... 20.3170

Visalia-Tulare-Porterville, CA ........ 19.9417

Waco, TX ...................................... 15.4645

Washington, DC–MD–VA–WV ..... 21.6632

Waterloo-Cedar Falls, IA .............. 17.3631

Wausau, WI .................................. 21.1907

West Palm Beach-Boca Raton, FL 20.8423

Wheeling, OH–WV ........................ 15.4868

Wichita, KS ................................... 18.8949

Wichita Falls, TX ........................... 15.3642

Williamsport, PA ........................... 17.1768

Wilmington-Newark, DE–MD ........ 23.1858

Wilmington, NC ............................. 18.7325

Yakima, WA .................................. 20.2994

Yolo, CA ........................................ 22.9704

York, PA ........................................ 18.9189

Youngstown-Warren, OH .............. 19.9688

Yuba City, CA ............................... 20.7466

Yuma, AZ ...................................... 19.5572

TABLE 4E.—AVERAGE HOURLY WAGE

FOR RURAL AREAS

Nonurban area

Average

hourly

wage

Alabama ........................................ 14.5882

Alaska ........................................... 24.7201

Arizona .......................................... 16.0545

Arkansas ....................................... 14.0570

California ....................................... 20.0484

Colorado ....................................... 16.3349

Connecticut ................................... 25.3532
46080 Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations

TABLE 4E.—AVERAGE HOURLY WAGE

FOR RURAL AREAS—Continued

Nonurban area

Average

hourly

wage

Delaware ....................................... 17.9354

Florida ........................................... 17.7600

Georgia ......................................... 15.5949

Hawaii ........................................... 20.5550

Idaho ............................................. 16.5193

Illinois ............................................ 15.3604

Indiana .......................................... 16.3993

Iowa .............................................. 14.8515

Kansas .......................................... 14.4750

Kentucky ....................................... 15.6180

Louisiana ....................................... 14.8369

Maine ............................................ 17.0166

Maryland ....................................... 17.3152

Massachusetts .............................. 21.5382

Michigan ........................................ 17.9306

Minnesota ..................................... 16.4358

TABLE 4E.—AVERAGE HOURLY WAGE

FOR RURAL AREAS—Continued

Nonurban area

Average

hourly

wage

Mississippi ..................................... 13.8878

Missouri ......................................... 14.4791

Montana ........................................ 16.6820

Nebraska ....................................... 14.8733

Nevada .......................................... 17.9119

New Hampshire ............................ 19.5257

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

New Mexico .................................. 16.2165

New York ...................................... 16.8824

North Carolina ............................... 15.9493

North Dakota ................................. 14.7904

Ohio .............................................. 16.9480

Oklahoma ...................................... 14.2120

Oregon .......................................... 20.0438

Pennsylvania ................................. 16.9213

Puerto Rico ................................... 8.4891

TABLE 4E.—AVERAGE HOURLY WAGE

FOR RURAL AREAS—Continued

Nonurban area

Average

hourly

wage

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

South Carolina .............................. 15.9167

South Dakota ................................ 14.0318

Tennessee .................................... 14.7759

Texas ............................................ 14.8782

Utah .............................................. 17.9362

Vermont ........................................ 18.7155

Virginia .......................................... 15.6378

Washington ................................... 20.5396

West Virginia ................................. 15.9511

Wisconsin ...................................... 17.0229

Wyoming ....................................... 16.5729

1All counties within the State are classified

as urban.

TABLE 4F.—PUERTO RICO WAGE INDEX AND CAPITAL GEOGRAPHIC ADJUSTMENT FACTOR (GAF)

Area Wage index GAF

Wage

index—

reclass.

hospitals

GAF—

reclass.

hospitals

Aguadilla, PR 1 .................................................................................................................. 0.9291 0.9509 .................... ....................

Arecibo, PR 1 .................................................................................................................... 0.9291 0.9509 .................... ....................

Caguas, PR ...................................................................................................................... 0.9914 0.9941 0.9914 0.9941

Mayaguez, PR .................................................................................................................. 0.9843 0.9892 .................... ....................

Ponce, PR ........................................................................................................................ 1.0093 1.0064 .................... ....................

San Juan-Bayamon, PR ................................................................................................... 1.0156 1.0107 .................... ....................

Rural Puerto Rico ............................................................................................................. 0.9291 0.9509 .................... ....................

1 Hospitals geographically located in the area are assigned the statewide rural wage index for FY 1998.

TABLE 5.—LIST OF DIAGNOSIS RELATED GROUPS (DRGS), RELATIVE WEIGHTING FACTORS, GEOMETRIC AND ARITHMETIC

MEAN LENGTH OF STAY

Relative

weights

Geometric

mean LOS

Arithmetic

mean LOS

1 ....... 01 SURG CRANIOTOMY AGE >17 EXCEPT FOR TRAUMA .................................... 3.0907 7.2 10.3

2 ....... 01 SURG CRANIOTOMY FOR TRAUMA AGE >17 ................................................... 3.0511 7.9 10.6

3 ....... 01 SURG * CRANIOTOMY AGE 0–17 ......................................................................... 1.9484 12.7 12.7

4 ....... 01 SURG SPINAL PROCEDURES .............................................................................. 2.3858 5.5 8.5

5 ....... 01 SURG EXTRACRANIAL VASCULAR PROCEDURES .......................................... 1.5041 2.9 3.9

6 ....... 01 SURG CARPAL TUNNEL RELEASE ..................................................................... .7582 2.2 3.3

7 ....... 01 SURG PERIPH & CRANIAL NERVE & OTHER NERV SYST PROC W CC ........ 2.4717 7.3 11.4

8 ....... 01 SURG PERIPH & CRANIAL NERVE & OTHER NERV SYST PROC W/O CC .... 1.2142 2.2 3.2

9 ....... 01 MED SPINAL DISORDERS & INJURIES ............................................................ 1.2646 5.1 7.2

10 ..... 01 MED NERVOUS SYSTEM NEOPLASMS W CC ................................................. 1.2184 5.3 7.4

11 ..... 01 MED NERVOUS SYSTEM NEOPLASMS W/O CC ............................................. .7879 3.2 4.3

12 ..... 01 MED DEGENERATIVE NERVOUS SYSTEM DISORDERS ............................... .9370 5.0 6.8

13 ..... 01 MED MULTIPLE SCLEROSIS & CEREBELLAR ATAXIA ................................... .7832 4.7 5.8

14 ..... 01 MED SPECIFIC CEREBROVASCULAR DISORDERS EXCEPT TIA ................. 1.1889 5.1 6.8

15 ..... 01 MED TRANSIENT ISCHEMIC ATTACK & PRECEREBRAL OCCLUSIONS ...... .7241 3.2 4.1

16 ..... 01 MED NONSPECIFIC CEREBROVASCULAR DISORDERS W CC ..................... 1.0452 4.6 6.1

17 ..... 01 MED NONSPECIFIC CEREBROVASCULAR DISORDERS W/O CC ................. .6161 2.8 3.7

18 ..... 01 MED CRANIAL & PERIPHERAL NERVE DISORDERS W CC ........................... .9399 4.5 5.9

19 ..... 01 MED CRANIAL & PERIPHERAL NERVE DISORDERS W/O CC ....................... .6293 3.2 4.1

20 ..... 01 MED NERVOUS SYSTEM INFECTION EXCEPT VIRAL MENINGITIS ............. 2.5786 8.0 10.8

21 ..... 01 MED VIRAL MENINGITIS .................................................................................... 1.4866 5.4 7.1

22 ..... 01 MED HYPERTENSIVE ENCEPHALOPATHY ...................................................... .8594 3.7 4.8

23 ..... 01 MED NONTRAUMATIC STUPOR & COMA ........................................................ .7777 3.3 4.6

24 ..... 01 MED SEIZURE & HEADACHE AGE >17 W CC .................................................. .9578 3.9 5.3

25 ..... 01 MED SEIZURE & HEADACHE AGE >17 W/O CC .............................................. .5821 2.8 3.6

26 ..... 01 MED SEIZURE & HEADACHE AGE 0–17 ........................................................... .9601 3.6 4.9

27 ..... 01 MED TRAUMATIC STUPOR & COMA, COMA >1 HR ........................................ 1.2670 3.4 5.5

28 ..... 01 MED TRAUMATIC STUPOR & COMA, COMA <1 HR AGE >17 W CC ............. 1.1707 4.4 6.4

29 ..... 01 MED TRAUMATIC STUPOR & COMA, COMA <1 HR AGE >17 W/O CC ......... .6383 2.8 3.7
Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations 46081

TABLE 5.—LIST OF DIAGNOSIS RELATED GROUPS (DRGS), RELATIVE WEIGHTING FACTORS, GEOMETRIC AND ARITHMETIC

MEAN LENGTH OF STAY—Continued

Relative

weights

Geometric

mean LOS

Arithmetic

mean LOS

30 ..... 01 MED * TRAUMATIC STUPOR & COMA, COMA <1 HR AGE 0–17 .................... .3295 2.0 2.0

31 ..... 01 MED CONCUSSION AGE >17 W CC .................................................................. .8369 3.4 4.8

32 ..... 01 MED CONCUSSION AGE >17 W/O CC .............................................................. .5109 2.2 3.1

33 ..... 01 MED * CONCUSSION AGE 0–17 ......................................................................... .2071 1.6 1.6

34 ..... 01 MED OTHER DISORDERS OF NERVOUS SYSTEM W CC .............................. 1.0385 4.2 5.8

35 ..... 01 MED OTHER DISORDERS OF NERVOUS SYSTEM W/O CC .......................... .5941 3.0 3.9

36 ..... 02 SURG RETINAL PROCEDURES ........................................................................... .6265 1.3 1.5

37 ..... 02 SURG ORBITAL PROCEDURES ........................................................................... .9725 2.6 3.9

38 ..... 02 SURG PRIMARY IRIS PROCEDURES .................................................................. .4826 1.9 2.7

39 ..... 02 SURG LENS PROCEDURES WITH OR WITHOUT VITRECTOMY ..................... .5406 1.5 2.0

40 ..... 02 SURG EXTRAOCULAR PROCEDURES EXCEPT ORBIT AGE >17 .................... .7341 2.2 3.3

41 ..... 02 SURG *EXTRAOCULAR PROCEDURES EXCEPT ORBIT AGE 0–17 ................ .3354 1.6 1.6

42 ..... 02 SURG INTRAOCULAR PROCEDURES EXCEPT RETINA, IRIS & LENS ........... .5676 1.5 2.0

43 ..... 02 MED HYPHEMA ................................................................................................... .4119 2.9 4.0

44 ..... 02 MED ACUTE MAJOR EYE INFECTIONS ............................................................ .6072 4.3 5.3

45 ..... 02 MED NEUROLOGICAL EYE DISORDERS ......................................................... .6730 2.9 3.6

46 ..... 02 MED OTHER DISORDERS OF THE EYE AGE >17 W CC ................................ .7234 3.7 4.9

47 ..... 02 MED OTHER DISORDERS OF THE EYE AGE >17 W/O CC ............................ .4623 2.7 3.6

48 ..... 02 MED * OTHER DISORDERS OF THE EYE AGE 0–17 ....................................... .2955 2.9 2.9

49 ..... 03 SURG MAJOR HEAD & NECK PROCEDURES .................................................... 1.8074 3.9 5.3

50 ..... 03 SURG SIALOADENECTOMY ................................................................................. .8143 1.7 2.1

51 ..... 03 SURG SALIVARY GLAND PROCEDURES EXCEPT SIALOADENECTOMY ....... .8367 1.9 2.9

52 ..... 03 SURG CLEFT LIP & PALATE REPAIR .................................................................. 1.2768 2.2 3.2

53 ..... 03 SURG SINUS & MASTOID PROCEDURES AGE >17 .......................................... 1.0682 2.3 3.6

54 ..... 03 SURG *SINUS & MASTOID PROCEDURES AGE 0–17 ...................................... .4790 3.2 3.2

55 ..... 03 SURG MISCELLANEOUS EAR, NOSE, MOUTH & THROAT PROCEDURES .... .8366 2.0 2.9

56 ..... 03 SURG RHINOPLASTY ............................................................................................ .8830 2.1 2.8

57 ..... 03 SURG T&A PROC, EXCEPT TONSILLECTOMY &/OR ADENOIDECTOMY

ONLY, AGE >17.

1.0182 2.7 4.0

58 ..... 03 SURG * T&A PROC, EXCEPT TONSILLECTOMY &/OR ADENOIDECTOMY

ONLY, AGE 0–17.

.2720 1.5 1.5

59 ..... 03 SURG TONSILLECTOMY &/OR ADENOIDECTOMY ONLY, AGE >17 ................ .8238 2.3 3.3

60 ..... 03 SURG * TONSILLECTOMY &/OR ADENOIDECTOMY ONLY, AGE 0–17 ............ .2072 1.5 1.5

61 ..... 03 SURG MYRINGOTOMY W TUBE INSERTION AGE >17 ..................................... 1.1181 2.8 4.5

62 ..... 03 SURG * MYRINGOTOMY W TUBE INSERTION AGE 0–17 ................................. .2933 1.3 1.3

63 ..... 03 SURG OTHER EAR, NOSE, MOUTH & THROAT O.R. PROCEDURES ............. 1.2444 3.1 4.6

64 ..... 03 MED EAR, NOSE, MOUTH & THROAT MALIGNANCY ..................................... 1.1568 4.4 6.7

65 ..... 03 MED DYSEQUILIBRIUM ...................................................................................... .5177 2.5 3.2

66 ..... 03 MED EPISTAXIS .................................................................................................. .5605 2.8 3.5

67 ..... 03 MED EPIGLOTTITIS ............................................................................................. .7866 3.1 3.8

68 ..... 03 MED OTITIS MEDIA & URI AGE >17 W CC ....................................................... .6831 3.5 4.3

69 ..... 03 MED OTITIS MEDIA & URI AGE >17 W/O CC ................................................... .5160 2.9 3.5

70 ..... 03 MED OTITIS MEDIA & URI AGE 0–17 ................................................................ .3892 2.7 3.3

71 ..... 03 MED LARYNGOTRACHEITIS .............................................................................. .6688 3.0 3.9

72 ..... 03 MED NASAL TRAUMA & DEFORMITY ............................................................... .6364 2.7 3.5

73 ..... 03 MED OTHER EAR, NOSE, MOUTH & THROAT DIAGNOSES AGE >17 .......... .7660 3.4 4.7

74 ..... 03 MED * OTHER EAR, NOSE, MOUTH & THROAT DIAGNOSES AGE 0–17 ...... .3332 2.1 2.1

75 ..... 04 SURG MAJOR CHEST PROCEDURES ................................................................ 3.1958 8.3 10.6

76 ..... 04 SURG OTHER RESP SYSTEM O.R. PROCEDURES W CC ............................... 2.6427 8.7 11.7

77 ..... 04 SURG OTHER RESP SYSTEM O.R. PROCEDURES W/O CC ............................ 1.1150 3.5 5.1

78 ..... 04 MED PULMONARY EMBOLISM .......................................................................... 1.4264 6.6 7.7

79 ..... 04 MED RESPIRATORY INFECTIONS & INFLAMMATIONS AGE >17 W CC ....... 1.6258 6.8 8.7

80 ..... 04 MED RESPIRATORY INFECTIONS & INFLAMMATIONS AGE >17 W/O CC ... .9121 4.9 6.1

81 ..... 04 MED * RESPIRATORY INFECTIONS & INFLAMMATIONS AGE 0–17 .............. 1.5091 6.1 6.1

82 ..... 04 MED RESPIRATORY NEOPLASMS .................................................................... 1.3329 5.4 7.4

83 ..... 04 MED MAJOR CHEST TRAUMA W CC ................................................................ .9716 4.6 5.9

84 ..... 04 MED MAJOR CHEST TRAUMA W/O CC ............................................................ .5260 2.8 3.5

85 ..... 04 MED PLEURAL EFFUSION W CC ...................................................................... 1.2212 5.3 6.9

86 ..... 04 MED PLEURAL EFFUSION W/O CC .................................................................. .6715 3.1 4.1

87 ..... 04 MED PULMONARY EDEMA & RESPIRATORY FAILURE ................................. 1.3639 4.9 6.5

88 ..... 04 MED CHRONIC OBSTRUCTIVE PULMONARY DISEASE ................................. .9705 4.6 5.7
46082 Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations

TABLE 5.—LIST OF DIAGNOSIS RELATED GROUPS (DRGS), RELATIVE WEIGHTING FACTORS, GEOMETRIC AND ARITHMETIC

MEAN LENGTH OF STAY—Continued

Relative

weights

Geometric

mean LOS

Arithmetic

mean LOS

89 ..... 04 MED SIMPLE PNEUMONIA & PLEURISY AGE >17 W CC ............................... 1.1006 5.4 6.6

90 ..... 04 MED SIMPLE PNEUMONIA & PLEURISY AGE >17 W/O CC ........................... .6773 4.0 4.7

91 ..... 04 MED SIMPLE PNEUMONIA & PLEURISY AGE 0–17 ........................................ .7940 3.7 4.4

92 ..... 04 MED INTERSTITIAL LUNG DISEASE W CC ...................................................... 1.1947 5.3 6.7

93 ..... 04 MED INTERSTITIAL LUNG DISEASE W/O CC .................................................. .7423 3.7 4.7

94 ..... 04 MED PNEUMOTHORAX W CC ........................................................................... 1.1857 5.1 6.7

95 ..... 04 MED PNEUMOTHORAX W/O CC ....................................................................... .5974 3.2 4.0

96 ..... 04 MED BRONCHITIS & ASTHMA AGE >17 W CC ................................................ .8005 4.2 5.1

97 ..... 04 MED BRONCHITIS & ASTHMA AGE >17 W/O CC ............................................ .5887 3.3 4.0

98 ..... 04 MED BRONCHITIS & ASTHMA AGE 0–17 ......................................................... .6298 2.3 3.8

99 ..... 04 MED RESPIRATORY SIGNS & SYMPTOMS W CC .......................................... .6710 2.4 3.2

100 ... 04 MED RESPIRATORY SIGNS & SYMPTOMS W/O CC ....................................... .5109 1.8 2.2

101 ... 04 MED OTHER RESPIRATORY SYSTEM DIAGNOSES W CC ............................ .8518 3.5 4.7

102 ... 04 MED OTHER RESPIRATORY SYSTEM DIAGNOSES W/O CC ........................ .5295 2.3 2.9

103 ... 05 SURG HEART TRANSPLANT ................................................................................ 16.5746 32.1 48.2

104 ... 05 SURG CARDIAC VALVE PROCEDURES W CARDIAC CATH ............................. 7.3563 10.8 13.3

105 ... 05 SURG CARDIAC VALVE PROCEDURES W/O CARDIAC CATH ......................... 5.7109 8.3 10.2

106 ... 05 SURG CORONARY BYPASS W CARDIAC CATH ................................................ 5.5843 9.8 11.1

107 ... 05 SURG CORONARY BYPASS W/O CARDIAC CATH ............................................ 4.0812 7.3 8.3

108 ... 05 SURG OTHER CARDIOTHORACIC PROCEDURES ............................................ 6.1282 9.4 12.1

109 ... ............ NO LONGER VALID .................................................................................... .0000 .0 .0

110 ... 05 SURG MAJOR CARDIOVASCULAR PROCEDURES W CC ................................ 4.1964 7.7 10.2

111 ... 05 SURG MAJOR CARDIOVASCULAR PROCEDURES W/O CC ............................. 2.2409 5.4 6.2

112 ... 05 SURG PERCUTANEOUS CARDIOVASCULAR PROCEDURES .......................... 2.0025 3.1 4.2

113 ... 05 SURG AMPUTATION FOR CIRC SYSTEM DISORDERS EXCEPT UPPER

LIMB & TOE.

2.6579 9.7 13.2

114 ... 05 SURG UPPER LIMB & TOE AMPUTATION FOR CIRC SYSTEM DISORDERS 1.5363 6.4 8.8

115 ... 05 SURG PERM PACE IMPLNT W AMI, HRT FAIL OR SHOCK OR AICD LEAD

OR GEN PROC.

3.5476 6.7 9.2

116 ... 05 SURG OTH PERM CARDIAC PACEMAKER IMPLANT OR PTCA W CORONARY ART STENT.2.5321 3.5 4.7

117 ... 05 SURG CARDIAC PACEMAKER REVISION EXCEPT DEVICE REPLACEMENT 1.1950 2.7 4.0

118 ... 05 SURG CARDIAC PACEMAKER DEVICE REPLACEMENT .................................. 1.5889 2.0 3.0

119 ... 05 SURG VEIN LIGATION & STRIPPING .................................................................. 1.1997 3.1 5.1

120 ... 05 SURG OTHER CIRCULATORY SYSTEM O.R. PROCEDURES .......................... 1.9158 5.0 8.5

121 ... 05 MED CIRCULATORY DISORDERS W AMI & MAJOR COMP DISCH ALIVE ... 1.6537 6.0 7.3

122 ... 05 MED CIRCULATORY DISORDERS W AMI W/O MAJOR COMP DISCH ALIVE 1.1446 3.9 4.7

123 ... 05 MED CIRCULATORY DISORDERS W AMI, EXPIRED ...................................... 1.4695 2.7 4.5

124 ... 05 MED CIRCULATORY DISORDERS EXCEPT AMI, W CARD CATH & COMPLEX DIAG.1.3565 3.6 4.6

125 ... 05 MED CIRCULATORY DISORDERS EXCEPT AMI, W CARD CATH W/O COMPLEX DIAG..9738 2.3 2.9

126 ... 05 MED ACUTE & SUBACUTE ENDOCARDITIS .................................................... 2.4879 10.0 13.1

127 ... 05 MED HEART FAILURE & SHOCK ....................................................................... 1.0199 4.5 5.8

128 ... 05 MED DEEP VEIN THROMBOPHLEBITIS ............................................................ .7807 5.6 6.4

129 ... 05 MED CARDIAC ARREST, UNEXPLAINED ......................................................... 1.1414 1.9 3.2

130 ... 05 MED PERIPHERAL VASCULAR DISORDERS W CC ........................................ .9410 5.1 6.3

131 ... 05 MED PERIPHERAL VASCULAR DISORDERS W/O CC .................................... .6040 4.1 4.9

132 ... 05 MED ATHEROSCLEROSIS W CC ...................................................................... .6749 2.7 3.3

133 ... 05 MED ATHEROSCLEROSIS W/O CC ................................................................... .5360 2.1 2.7

134 ... 05 MED HYPERTENSION ......................................................................................... .5760 2.8 3.6

135 ... 05 MED CARDIAC CONGENITAL & VALVULAR DISORDERS AGE >17 W CC ... .8336 3.4 4.5

136 ... 05 MED CARDIAC CONGENITAL & VALVULAR DISORDERS AGE >17 W/O CC .5709 2.4 3.1

137 ... 05 MED * CARDIAC CONGENITAL & VALVULAR DISORDERS AGE 0–17 .......... .8131 3.3 3.3

138 ... 05 MED CARDIAC ARRHYTHMIA & CONDUCTION DISORDERS W CC ............. .7962 3.2 4.2

139 ... 05 MED CARDIAC ARRHYTHMIA & CONDUCTION DISORDERS W/O CC ......... .4982 2.2 2.7

140 ... 05 MED ANGINA PECTORIS .................................................................................... .5993 2.6 3.2

141 ... 05 MED SYNCOPE & COLLAPSE W CC ................................................................. .7005 3.1 4.1

142 ... 05 MED SYNCOPE & COLLAPSE W/O CC ............................................................. .5231 2.3 2.9

143 ... 05 MED CHEST PAIN ............................................................................................... .5200 1.9 2.4

144 ... 05 MED OTHER CIRCULATORY SYSTEM DIAGNOSES W CC ............................ 1.0904 3.9 5.4

145 ... 05 MED OTHER CIRCULATORY SYSTEM DIAGNOSES W/O CC ........................ .6401 2.3 3.0

146 ... 06 SURG RECTAL RESECTION W CC ...................................................................... 2.7356 9.3 10.5

147 ... 06 SURG RECTAL RESECTION W/O CC .................................................................. 1.5885 6.3 6.9

148 ... 06 SURG MAJOR SMALL & LARGE BOWEL PROCEDURES W CC ....................... 3.3883 10.6 12.6

149 ... 06 SURG MAJOR SMALL & LARGE BOWEL PROCEDURES W/O CC ................... 1.5495 6.5 7.1

150 ... 06 SURG PERITONEAL ADHESIOLYSIS W CC ........................................................ 2.7109 9.1 11.1

151 ... 06 SURG PERITONEAL ADHESIOLYSIS W/O CC .................................................... 1.2645 4.9 6.1

152 ... 06 SURG MINOR SMALL & LARGE BOWEL PROCEDURES W CC ....................... 1.9139 7.2 8.5

153 ... 06 SURG MINOR SMALL & LARGE BOWEL PROCEDURES W/O CC .................... 1.1634 5.2 5.8
Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations 46083

TABLE 5.—LIST OF DIAGNOSIS RELATED GROUPS (DRGS), RELATIVE WEIGHTING FACTORS, GEOMETRIC AND ARITHMETIC

MEAN LENGTH OF STAY—Continued

Relative

weights

Geometric

mean LOS

Arithmetic

mean LOS

154 ... 06 SURG STOMACH, ESOPHAGEAL & DUODENAL PROCEDURES AGE >17 W

CC.

4.1851 10.8 14.1

155 ... 06 SURG STOMACH, ESOPHAGEAL & DUODENAL PROCEDURES AGE >17 W/

O CC.

1.3350 3.9 5.0

156 ... 06 SURG *STOMACH, ESOPHAGEAL & DUODENAL PROCEDURES AGE 0–17 .8374 6.0 6.0

157 ... 06 SURG ANAL & STOMAL PROCEDURES W CC .................................................. 1.1824 4.0 5.6

158 ... 06 SURG ANAL & STOMAL PROCEDURES W/O CC ............................................... .6272 2.2 2.8

159 ... 06 SURG HERNIA PROCEDURES EXCEPT INGUINAL & FEMORAL AGE >17 W

CC.

1.2548 3.8 5.1

160 ... 06 SURG HERNIA PROCEDURES EXCEPT INGUINAL & FEMORAL AGE >17 W/

O CC.

.7177 2.3 2.8

161 ... 06 SURG INGUINAL & FEMORAL HERNIA PROCEDURES AGE >17 W CC ......... 1.0573 3.0 4.2

162 ... 06 SURG INGUINAL & FEMORAL HERNIA PROCEDURES AGE >17 W/O CC ...... .5856 1.7 2.1

163 ... 06 SURG HERNIA PROCEDURES AGE 0–17 ........................................................... .8660 3.1 4.7

164 ... 06 SURG APPENDECTOMY W COMPLICATED PRINCIPAL DIAG W CC .............. 2.3412 7.5 8.7

165 ... 06 SURG APPENDECTOMY W COMPLICATED PRINCIPAL DIAG W/O CC .......... 1.2270 4.7 5.4

166 ... 06 SURG APPENDECTOMY W/O COMPLICATED PRINCIPAL DIAG W CC .......... 1.4582 4.3 5.4

167 ... 06 SURG APPENDECTOMY W/O COMPLICATED PRINCIPAL DIAG W/O CC ...... .8373 2.5 3.0

168 ... 03 SURG MOUTH PROCEDURES W CC .................................................................. 1.1187 3.2 4.7

169 ... 03 SURG MOUTH PROCEDURES W/O CC .............................................................. .6903 2.0 2.6

170 ... 06 SURG OTHER DIGESTIVE SYSTEM O.R. PROCEDURES W CC ...................... 2.7587 8.1 11.8

171 ... 06 SURG OTHER DIGESTIVE SYSTEM O.R. PROCEDURES W/O CC .................. 1.1146 3.7 5.1

172 ... 06 MED DIGESTIVE MALIGNANCY W CC .............................................................. 1.2867 5.3 7.4

173 ... 06 MED DIGESTIVE MALIGNANCY W/O CC .......................................................... .6744 2.9 4.0

174 ... 06 MED G.I. HEMORRHAGE W CC ......................................................................... .9925 4.1 5.2

175 ... 06 MED G.I. HEMORRHAGE W/O CC ..................................................................... .5366 2.7 3.2

176 ... 06 MED COMPLICATED PEPTIC ULCER ............................................................... 1.1011 4.5 5.8

177 ... 06 MED UNCOMPLICATED PEPTIC ULCER W CC ............................................... .8556 3.8 4.7

178 ... 06 MED UNCOMPLICATED PEPTIC ULCER W/O CC ........................................... .6241 2.8 3.3

179 ... 06 MED INFLAMMATORY BOWEL DISEASE ......................................................... 1.1100 5.2 6.7

180 ... 06 MED G.I. OBSTRUCTION W CC ......................................................................... .9153 4.4 5.7

181 ... 06 MED G.I. OBSTRUCTION W/O CC ..................................................................... .5204 3.1 3.7

182 ... 06 MED ESOPHAGITIS, GASTROENT & MISC DIGEST DISORDERS AGE >17

W CC.

.7664 3.5 4.6

183 ... 06 MED ESOPHAGITIS, GASTROENT & MISC DIGEST DISORDERS AGE >17

W/O CC.

.5496 2.6 3.2

184 ... 06 MED ESOPHAGITIS, GASTROENT & MISC DIGEST DISORDERS AGE 0–17 .5930 2.7 3.6

185 ... 03 MED DENTAL & ORAL DIS EXCEPT EXTRACTIONS & RESTORATIONS,

AGE >17.

.8424 3.5 4.8

186 ... 03 MED * DENTAL & ORAL DIS EXCEPT EXTRACTIONS & RESTORATIONS,

AGE 0–17.

.3192 2.9 2.9

187 ... 03 MED DENTAL EXTRACTIONS & RESTORATIONS ........................................... .7049 3.0 4.0

188 ... 06 MED OTHER DIGESTIVE SYSTEM DIAGNOSES AGE >17 W CC .................. 1.0727 4.3 5.8

189 ... 06 MED OTHER DIGESTIVE SYSTEM DIAGNOSES AGE >17 W/O CC ............... .5488 2.5 3.4

190 ... 06 MED OTHER DIGESTIVE SYSTEM DIAGNOSES AGE 0–17 ........................... .8786 3.3 4.9

191 ... 07 SURG PANCREAS, LIVER & SHUNT PROCEDURES W CC .............................. 4.3490 11.1 14.9

192 ... 07 SURG PANCREAS, LIVER & SHUNT PROCEDURES W/O CC .......................... 1.7057 5.6 7.1

193 ... 07 SURG BILIARY TRACT PROC EXCEPT ONLY CHOLECYST W OR W/O

C.D.E. W CC.

3.2666 10.6 13.0

194 ... 07 SURG BILIARY TRACT PROC EXCEPT ONLY CHOLECYST W OR W/O

C.D.E. W/O CC.

1.6688 5.9 7.5

195 ... 07 SURG CHOLECYSTECTOMY W C.D.E. W CC .................................................... 2.7112 8.2 9.8

196 ... 07 SURG CHOLECYSTECTOMY W C.D.E. W/O CC ................................................ 1.6075 5.5 6.3

197 ... 07 SURG CHOLECYSTECTOMY EXCEPT BY LAPAROSCOPE W/O C.D.E. W CC 2.3085 7.2 8.7

198 ... 07 SURG CHOLECYSTECTOMY EXCEPT BY LAPAROSCOPE W/O C.D.E. W/O

CC.

1.1693 4.1 4.7

199 ... 07 SURG HEPATOBILIARY DIAGNOSTIC PROCEDURE FOR MALIGNANCY ....... 2.3523 7.9 10.7

200 ... 07 SURG HEPATOBILIARY DIAGNOSTIC PROCEDURE FOR NON-MALIGNANCY.3.0210 7.5 11.3

201 ... 07 SURG OTHER HEPATOBILIARY OR PANCREAS O.R. PROCEDURES ............ 3.4752 11.1 15.2

202 ... 07 MED CIRRHOSIS & ALCOHOLIC HEPATITIS .................................................... 1.3255 5.3 7.2

203 ... 07 MED MALIGNANCY OF HEPATOBILIARY SYSTEM OR PANCREAS .............. 1.2605 5.2 7.2

204 ... 07 MED DISORDERS OF PANCREAS EXCEPT MALIGNANCY ............................ 1.2117 4.9 6.4

205 ... 07 MED DISORDERS OF LIVER EXCEPT MALIG, CIRR, ALC HEPA W CC ........ 1.2144 5.0 6.8

206 ... 07 MED DISORDERS OF LIVER EXCEPT MALIG, CIRR, ALC HEPA W/O CC .... .6543 3.2 4.2

207 ... 07 MED DISORDERS OF THE BILIARY TRACT W CC .......................................... 1.0507 4.1 5.3

208 ... 07 MED DISORDERS OF THE BILIARY TRACT W/O CC ...................................... .6039 2.4 3.0

209 ... 08 SURG MAJOR JOINT & LIMB REATTACHMENT PROCEDURES OF LOWER

EXTREMITY.

2.2337 5.3 5.9

210 ... 08 SURG HIP & FEMUR PROCEDURES EXCEPT MAJOR JOINT AGE >17 W CC 1.8265 6.5 7.6
46084 Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations

TABLE 5.—LIST OF DIAGNOSIS RELATED GROUPS (DRGS), RELATIVE WEIGHTING FACTORS, GEOMETRIC AND ARITHMETIC

MEAN LENGTH OF STAY—Continued

Relative

weights

Geometric

mean LOS

Arithmetic

mean LOS

211 ... 08 SURG HIP & FEMUR PROCEDURES EXCEPT MAJOR JOINT AGE >17 W/O

CC.

1.2541 5.0 5.6

212 ... 08 SURG HIP & FEMUR PROCEDURES EXCEPT MAJOR JOINT AGE 0–17 ........ 1.1311 3.9 5.2

213 ... 08 SURG AMPUTATION FOR MUSCULOSKELETAL SYSTEM & CONN TISSUE

DISORDERS.

1.6513 6.4 8.8

214 ... 08 SURG NO LONGER VALID .................................................................................... .0000 .0 .0

215 ... 08 SURG NO LONGER VALID .................................................................................... .0000 .0 .0

216 ... 08 SURG BIOPSIES OF MUSCULOSKELETAL SYSTEM & CONNECTIVE TISSUE.2.1082 7.4 10.3

217 ... 08 SURG WND DEBRID & SKN GRFT EXCEPT HAND, FOR MUSCSKELET &

CONN TISS DIS.

2.8033 9.2 13.8

218 ... 08 SURG LOWER EXTREM & HUMER PROC EXCEPT HIP, FOOT, FEMUR AGE

>17 W CC.

1.4576 4.4 5.6

219 ... 08 SURG LOWER EXTREM & HUMER PROC EXCEPT HIP, FOOT, FEMUR AGE

>17 W/O CC.

.9631 2.9 3.4

220 ... 08 SURG * LOWER EXTREM & HUMER PROC EXCEPT HIP, FOOT, FEMUR

AGE 0–17.

.5800 5.3 5.3

221 ... 08 SURG NO LONGER VALID .................................................................................... .0000 .0 .0

222 ... 08 SURG NO LONGER VALID .................................................................................... .0000 .0 .0

223 ... 08 SURG MAJOR SHOULDER/ELBOW PROC, OR OTHER UPPER EXTREMITY

PROC W CC.

.9007 2.1 2.7

224 ... 08 SURG SHOULDER, ELBOW OR FOREARM PROC, EXC MAJOR JOINT

PROC, W/O CC.

.7466 1.8 2.1

225 ... 08 SURG FOOT PROCEDURES ................................................................................ 1.0124 3.1 4.6

226 ... 08 SURG SOFT TISSUE PROCEDURES W CC ........................................................ 1.4095 4.1 6.3

227 ... 08 SURG SOFT TISSUE PROCEDURES W/O CC .................................................... .7729 2.2 2.9

228 ... 08 SURG MAJOR THUMB OR JOINT PROC, OR OTH HAND OR WRIST PROC

W CC.

.9542 2.3 3.5

229 ... 08 SURG HAND OR WRIST PROC, EXCEPT MAJOR JOINT PROC, W/O CC ....... .6706 1.8 2.4

230 ... 08 SURG LOCAL EXCISION & REMOVAL OF INT FIX DEVICES OF HIP &

FEMUR.

1.1296 3.3 5.0

231 ... 08 SURG LOCAL EXCISION & REMOVAL OF INT FIX DEVICES EXCEPT HIP &

FEMUR.

1.2727 3.1 4.8

232 ... 08 SURG ARTHROSCOPY ......................................................................................... 1.0629 2.5 4.2

233 ... 08 SURG OTHER MUSCULOSKELET SYS & CONN TISS O.R. PROC W CC ....... 2.0329 5.7 8.3

234 ... 08 SURG OTHER MUSCULOSKELET SYS & CONN TISS O.R. PROC W/O CC .... 1.1126 2.9 3.9

235 ... 08 MED FRACTURES OF FEMUR ........................................................................... .7710 4.2 5.9

236 ... 08 MED FRACTURES OF HIP & PELVIS ................................................................ .7338 4.3 5.7

237 ... 08 MED SPRAINS, STRAINS, & DISLOCATIONS OF HIP, PELVIS & THIGH ....... .5952 3.2 4.2

238 ... 08 MED OSTEOMYELITIS ........................................................................................ 1.3250 7.0 9.5

239 ... 08 MED PATHOLOGICAL FRACTURES & MUSCULOSKELETAL & CONN TISS

MALIGNANCY.

.9865 5.3 7.0

240 ... 08 MED CONNECTIVE TISSUE DISORDERS W CC .............................................. 1.2098 5.1 7.0

241 ... 08 MED CONNECTIVE TISSUE DISORDERS W/O CC .......................................... .5862 3.3 4.2

242 ... 08 MED SEPTIC ARTHRITIS .................................................................................... 1.0501 5.5 7.2

243 ... 08 MED MEDICAL BACK PROBLEMS ..................................................................... .7158 4.0 5.1

244 ... 08 MED BONE DISEASES & SPECIFIC ARTHROPATHIES W CC ........................ .7199 4.0 5.4

245 ... 08 MED BONE DISEASES & SPECIFIC ARTHROPATHIES W/O CC .................... .5002 3.0 4.0

246 ... 08 MED NON-SPECIFIC ARTHROPATHIES ........................................................... .5713 3.3 4.2

247 ... 08 MED SIGNS & SYMPTOMS OF MUSCULOSKELETAL SYSTEM & CONN

TISSUE.

.5587 2.8 3.7

248 ... 08 MED TENDONITIS, MYOSITIS & BURSITIS ...................................................... .7428 3.7 5.0

249 ... 08 MED AFTERCARE, MUSCULOSKELETAL SYSTEM & CONNECTIVE TISSUE .6559 2.7 4.0

250 ... 08 MED FX, SPRN, STRN & DISL OF FOREARM, HAND, FOOT AGE >17 W CC .6995 3.4 4.7

251 ... 08 MED FX, SPRN, STRN & DISL OF FOREARM, HAND, FOOT AGE >17 W/O

CC.

.4517 2.3 3.0

252 ... 08 MED * FX, SPRN, STRN & DISL OF FOREARM, HAND, FOOT AGE 0–17 ...... .2520 1.8 1.8

253 ... 08 MED FX, SPRN, STRN & DISL OF UPARM, LOWLEG EX FOOT AGE >17 W

CC.

.7265 3.9 5.3

254 ... 08 MED FX, SPRN, STRN & DISL OF UPARM, LOWLEG EX FOOT AGE >17 W/

O CC.

.4350 2.8 3.5

255 ... 08 MED * FX, SPRN, STRN & DISL OF UPARM, LOWLEG EX FOOT AGE 0–17 .2934 2.9 2.9

256 ... 08 MED OTHER MUSCULOSKELETAL SYSTEM & CONNECTIVE TISSUE DIAGNOSES..7826 4.0 5.7

257 ... 09 SURG TOTAL MASTECTOMY FOR MALIGNANCY W CC .................................. .9276 2.6 3.2

258 ... 09 SURG TOTAL MASTECTOMY FOR MALIGNANCY W/O CC .............................. .7162 2.0 2.3

259 ... 09 SURG SUBTOTAL MASTECTOMY FOR MALIGNANCY W CC ........................... .8874 2.1 3.2

260 ... 09 SURG SUBTOTAL MASTECTOMY FOR MALIGNANCY W/O CC ....................... .6092 1.4 1.7

261 ... 09 SURG BREAST PROC FOR NON-MALIGNANCY EXCEPT BIOPSY & LOCAL

EXCISION.

.8961 1.8 2.2
Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations 46085

TABLE 5.—LIST OF DIAGNOSIS RELATED GROUPS (DRGS), RELATIVE WEIGHTING FACTORS, GEOMETRIC AND ARITHMETIC

MEAN LENGTH OF STAY—Continued

Relative

weights

Geometric

mean LOS

Arithmetic

mean LOS

262 ... 09 SURG BREAST BIOPSY & LOCAL EXCISION FOR NON-MALIGNANCY .......... .7820 2.6 4.0

263 ... 09 SURG SKIN GRAFT &/OR DEBRID FOR SKN ULCER OR CELLULITIS W CC 2.0221 8.9 12.6

264 ... 09 SURG SKIN GRAFT &/OR DEBRID FOR SKN ULCER OR CELLULITIS W/O

CC.

1.0773 5.4 7.3

265 ... 09 SURG SKIN GRAFT &/OR DEBRID EXCEPT FOR SKIN ULCER OR

CELLULITIS W CC.

1.5166 4.6 7.3

266 ... 09 SURG SKIN GRAFT &/OR DEBRID EXCEPT FOR SKIN ULCER OR

CELLULITIS W/O CC.

.7909 2.6 3.6

267 ... 09 SURG PERIANAL & PILONIDAL PROCEDURES ................................................. .8424 2.7 4.1

268 ... 09 SURG SKIN, SUBCUTANEOUS TISSUE & BREAST PLASTIC PROCEDURES 1.0090 2.4 3.5

269 ... 09 SURG OTHER SKIN, SUBCUT TISS & BREAST PROC W CC ........................... 1.5733 5.9 8.5

270 ... 09 SURG OTHER SKIN, SUBCUT TISS & BREAST PROC W/O CC ....................... .7061 2.2 3.2

271 ... 09 MED SKIN ULCERS ............................................................................................. 1.0259 6.0 7.8

272 ... 09 MED MAJOR SKIN DISORDERS W CC ............................................................. .9950 5.1 6.7

273 ... 09 MED MAJOR SKIN DISORDERS W/O CC ......................................................... .6618 4.0 5.4

274 ... 09 MED MALIGNANT BREAST DISORDERS W CC ............................................... 1.1229 5.0 7.2

275 ... 09 MED MALIGNANT BREAST DISORDERS W/O CC ........................................... .5882 2.5 3.9

276 ... 09 MED NON-MALIGANT BREAST DISORDERS ................................................... .6122 3.8 4.7

277 ... 09 MED CELLULITIS AGE >17 W CC ...................................................................... .8322 5.1 6.2

278 ... 09 MED CELLULITIS AGE >17 W/O CC .................................................................. .5574 4.0 4.8

279 ... 09 MED * CELLULITIS AGE 0–17 ............................................................................. .7309 4.2 4.2

280 ... 09 MED TRAUMA TO THE SKIN, SUBCUT TISS & BREAST AGE >17 W CC ..... .6757 3.4 4.7

281 ... 09 MED TRAUMA TO THE SKIN, SUBCUT TISS & BREAST AGE >17 W/O CC .4558 2.5 3.4

282 ... 09 MED * TRAUMA TO THE SKIN, SUBCUT TISS & BREAST AGE 0–17 ............ .2551 2.2 2.2

283 ... 09 MED MINOR SKIN DISORDERS W CC .............................................................. .6936 3.8 5.0

284 ... 09 MED MINOR SKIN DISORDERS W/O CC .......................................................... .4371 2.7 3.6

285 ... 10 SURG AMPUTAT OF LOWER LIMB FOR ENDOCRINE, NUTRIT, & METABOL

DISORDERS.

2.1556 8.8 12.1

286 ... 10 SURG ADRENAL & PITUITARY PROCEDURES .................................................. 2.2671 5.8 7.3

287 ... 10 SURG SKIN GRAFTS & WOUND DEBRID FOR ENDOC, NUTRIT & METAB

DISORDERS.

1.8727 8.6 12.1

288 ... 10 SURG O.R. PROCEDURES FOR OBESITY ......................................................... 2.0255 4.9 6.2

289 ... 10 SURG PARATHYROID PROCEDURES ................................................................ .9827 2.4 3.5

290 ... 10 SURG THYROID PROCEDURES .......................................................................... .8970 2.0 2.6

291 ... 10 SURG THYROGLOSSAL PROCEDURES ............................................................. .7372 1.7 2.2

292 ... 10 SURG OTHER ENDOCRINE, NUTRIT & METAB O.R. PROC W CC .................. 2.5483 7.6 11.2

293 ... 10 SURG OTHER ENDOCRINE, NUTRIT & METAB O.R. PROC W/O CC .............. 1.2297 3.8 5.6

294 ... 10 MED DIABETES AGE >35 ................................................................................... .7546 4.0 5.3

295 ... 10 MED DIABETES AGE 0–35 ................................................................................. .7359 3.2 4.1

296 ... 10 MED NUTRITIONAL & MISC METABOLIC DISORDERS AGE >17 W CC ........ .8657 4.3 5.8

297 ... 10 MED NUTRITIONAL & MISC METABOLIC DISORDERS AGE >17 W/O CC .... .5188 3.0 3.9

298 ... 10 MED NUTRITIONAL & MISC METABOLIC DISORDERS AGE 0–17 ................. .4207 2.0 2.5

299 ... 10 MED INBORN ERRORS OF METABOLISM ....................................................... .8716 3.9 5.5

300 ... 10 MED ENDOCRINE DISORDERS W CC .............................................................. 1.0810 5.1 6.6

301 ... 10 MED ENDOCRINE DISORDERS W/O CC .......................................................... .5941 3.1 4.4

302 ... 11 SURG KIDNEY TRANSPLANT ............................................................................... 3.7570 9.2 10.9

303 ... 11 SURG KIDNEY, URETER & MAJOR BLADDER PROCEDURES FOR NEOPLASM.2.6139 7.8 9.5

304 ... 11 SURG KIDNEY, URETER & MAJOR BLADDER PROC FOR NON-NEOPL W

CC.

2.3982 6.9 9.6

305 ... 11 SURG KIDNEY, URETER & MAJOR BLADDER PROC FOR NON-NEOPL W/O

CC.

1.1695 3.4 4.3

306 ... 11 SURG PROSTATECTOMY W CC .......................................................................... 1.2168 4.0 5.8

307 ... 11 SURG PROSTATECTOMY W/O CC ...................................................................... .6455 2.1 2.5

308 ... 11 SURG MINOR BLADDER PROCEDURES W CC ................................................. 1.5120 4.3 6.4

309 ... 11 SURG MINOR BLADDER PROCEDURES W/O CC .............................................. .8760 2.1 2.6

310 ... 11 SURG TRANSURETHRAL PROCEDURES W CC ................................................ 1.0248 3.0 4.3

311 ... 11 SURG TRANSURETHRAL PROCEDURES W/O CC ............................................ .5866 1.7 2.1

312 ... 11 SURG URETHRAL PROCEDURES, AGE >17 W CC ........................................... .9732 3.1 4.7

313 ... 11 SURG URETHRAL PROCEDURES, AGE >17 W/O CC ....................................... .5783 1.8 2.3

314 ... 11 SURG * URETHRAL PROCEDURES, AGE 0–17 .................................................. .4916 2.3 2.3

315 ... 11 SURG OTHER KIDNEY & URINARY TRACT O.R. PROCEDURES ..................... 2.0601 4.9 8.5

316 ... 11 MED RENAL FAILURE ......................................................................................... 1.3089 5.1 7.1

317 ... 11 MED ADMIT FOR RENAL DIALYSIS .................................................................. .5489 2.0 2.9

318 ... 11 MED KIDNEY & URINARY TRACT NEOPLASMS W CC ................................... 1.1594 4.7 6.7

319 ... 11 MED KIDNEY & URINARY TRACT NEOPLASMS W/O CC ............................... .5808 2.0 2.8

320 ... 11 MED KIDNEY & URINARY TRACT INFECTIONS AGE >17 W CC ................... .8782 4.7 5.9

321 ... 11 MED KIDNEY & URINARY TRACT INFECTIONS AGE >17 W/O CC ................ .5838 3.6 4.3

322 ... 11 MED KIDNEY & URINARY TRACT INFECTIONS AGE 0–17 ............................ .5342 3.4 4.3

323 ... 11 MED URINARY STONES W CC, &/OR ESW LITHOTRIPSY ............................. .7555 2.5 3.4
46086 Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations

TABLE 5.—LIST OF DIAGNOSIS RELATED GROUPS (DRGS), RELATIVE WEIGHTING FACTORS, GEOMETRIC AND ARITHMETIC

MEAN LENGTH OF STAY—Continued

Relative

weights

Geometric

mean LOS

Arithmetic

mean LOS

324 ... 11 MED URINARY STONES W/O CC ...................................................................... .4298 1.7 2.0

325 ... 11 MED KIDNEY & URINARY TRACT SIGNS & SYMPTOMS AGE >17 W CC ..... .6207 3.1 4.2

326 ... 11 MED KIDNEY & URINARY TRACT SIGNS & SYMPTOMS AGE >17 W/O CC .4188 2.3 2.9

327 ... 11 MED KIDNEY & URINARY TRACT SIGNS & SYMPTOMS AGE 0–17 .............. .3516 2.3 3.5

328 ... 11 MED URETHRAL STRICTURE AGE >17 W CC ................................................. .6878 2.9 3.9

329 ... 11 MED URETHRAL STRICTURE AGE >17 W/O CC ............................................. .5080 1.9 2.3

330 ... 11 MED * URETHRAL STRICTURE AGE 0–17 ........................................................ .3167 1.6 1.6

331 ... 11 MED OTHER KIDNEY & URINARY TRACT DIAGNOSES AGE >17 W CC ...... 1.0009 4.4 5.9

332 ... 11 MED OTHER KIDNEY & URINARY TRACT DIAGNOSES AGE >17 W/O CC .. .5964 2.7 3.7

333 ... 11 MED OTHER KIDNEY & URINARY TRACT DIAGNOSES AGE 0–17 ............... .8389 4.0 5.7

334 ... 12 SURG MAJOR MALE PELVIC PROCEDURES W CC .......................................... 1.6359 4.8 5.4

335 ... 12 SURG MAJOR MALE PELVIC PROCEDURES W/O CC ...................................... 1.2190 3.7 4.1

336 ... 12 SURG TRANSURETHRAL PROSTATECTOMY W CC ......................................... .8870 2.9 3.8

337 ... 12 SURG TRANSURETHRAL PROSTATECTOMY W/O CC ..................................... .6129 2.1 2.4

338 ... 12 SURG TESTES PROCEDURES, FOR MALIGNANCY .......................................... 1.0950 3.3 5.1

339 ... 12 SURG TESTES PROCEDURES, NON-MALIGNANCY AGE >17 ......................... 1.0038 3.1 4.6

340 ... 12 SURG * TESTES PROCEDURES, NON-MALIGNANCY AGE 0–17 ..................... .2815 2.4 2.4

341 ... 12 SURG PENIS PROCEDURES ................................................................................ 1.1089 2.2 3.1

342 ... 12 SURG CIRCUMCISION AGE >17 .......................................................................... .8511 2.9 3.6

343 ... 12 SURG * CIRCUMCISION AGE 0–17 ...................................................................... .1529 1.7 1.7

344 ... 12 SURG OTHER MALE REPRODUCTIVE SYSTEM O.R. PROCEDURES FOR

MALIGNANCY.

1.0298 2.1 3.1

345 ... 12 SURG OTHER MALE REPRODUCTIVE SYSTEM O.R. PROC EXCEPT FOR

MALIGNANCY.

.8552 2.7 3.8

346 ... 12 MED MALIGNANCY, MALE REPRODUCTIVE SYSTEM, W CC ........................ .9573 4.5 6.3

347 ... 12 MED MALIGNANCY, MALE REPRODUCTIVE SYSTEM, W/O CC .................... .4603 2.2 3.0

348 ... 12 MED BENIGN PROSTATIC HYPERTROPHY W CC .......................................... .6958 3.3 4.5

349 ... 12 MED BENIGN PROSTATIC HYPERTROPHY W/O CC ...................................... .4154 2.1 2.7

350 ... 12 MED INFLAMMATION OF THE MALE REPRODUCTIVE SYSTEM ................... .6797 3.8 4.6

351 ... 12 MED *STERILIZATION, MALE ............................................................................ .2347 1.3 1.3

352 ... 12 MED OTHER MALE REPRODUCTIVE SYSTEM DIAGNOSES ......................... .6263 2.9 4.0

353 ... 13 SURG PELVIC EVISCERATION, RADICAL HYSTERECTOMY & RADICAL

VULVECTOMY.

2.1179 6.4 8.3

354 ... 13 SURG UTERINE, ADNEXA PROC FOR NON-OVARIAN/ADNEXAL MALIG W

CC.

1.4963 5.0 6.0

355 ... 13 SURG UTERINE, ADNEXA PROC FOR NON-OVARIAN/ADNEXAL MALIG W/O

CC.

.9180 3.4 3.6

356 ... 13 SURG FEMALE REPRODUCTIVE SYSTEM RECONSTRUCTIVE PROCEDURES..7701 2.5 2.8

357 ... 13 SURG UTERINE & ADNEXA PROC FOR OVARIAN OR ADNEXAL MALIGNANCY.2.4309 7.6 9.3

358 ... 13 SURG UTERINE & ADNEXA PROC FOR NON-MALIGNANCY W CC ................ 1.2021 3.8 4.5

359 ... 13 SURG UTERINE & ADNEXA PROC FOR NON-MALIGNANCY W/O CC ............ .8452 2.9 3.1

360 ... 13 SURG VAGINA, CERVIX & VULVA PROCEDURES ............................................. .8708 2.7 3.3

361 ... 13 SURG LAPAROSCOPY & INCISIONAL TUBAL INTERRUPTION ........................ 1.1872 2.6 3.7

362 ... 13 SURG *ENDOSCOPIC TUBAL INTERRUPTION .................................................. .3000 1.4 1.4

363 ... 13 SURG D&C, CONIZATION & RADIO–IMPLANT, FOR MALIGNANCY ................. .7485 2.6 3.5

364 ... 13 SURG D&C, CONIZATION EXCEPT FOR MALIGNANCY .................................... .6985 2.5 3.5

365 ... 13 SURG OTHER FEMALE REPRODUCTIVE SYSTEM O.R. PROCEDURES ........ 1.7085 4.7 7.2

366 ... 13 MED MALIGNANCY, FEMALE REPRODUCTIVE SYSTEM W CC .................... 1.1857 4.9 7.1

367 ... 13 MED MALIGNANCY, FEMALE REPRODUCTIVE SYSTEM W/O CC ................ .5309 2.1 2.9

368 ... 13 MED INFECTIONS, FEMALE REPRODUCTIVE SYSTEM ................................. .9698 4.9 6.2

369 ... 13 MED MENSTRUAL & OTHER FEMALE REPRODUCTIVE SYSTEM DISORDERS..5367 2.5 3.4

370 ... 14 SURG CESAREAN SECTION W CC ..................................................................... 1.0587 4.3 5.5

371 ... 14 SURG CESAREAN SECTION W/O CC ................................................................. .7054 3.3 3.6

372 ... 14 MED VAGINAL DELIVERY W COMPLICATING DIAGNOSES ........................... .5590 2.4 3.1

373 ... 14 MED VAGINAL DELIVERY W/O COMPLICATING DIAGNOSES ....................... .3987 1.7 2.0

374 ... 14 SURG VAGINAL DELIVERY W STERILIZATION &/OR D&C ............................... .7625 2.3 2.9

375 ... 14 SURG *VAGINAL DELIVERY W O.R. PROC EXCEPT STERIL &/OR D&C ........ .6809 4.4 4.4

376 ... 14 MED POSTPARTUM & POST ABORTION DIAGNOSES W/O O.R. PROCEDURE..4822 2.3 3.2

377 ... 14 SURG POSTPARTUM & POST ABORTION DIAGNOSES W O.R. PROCEDURE.1.0517 2.5 4.0

378 ... 14 MED ECTOPIC PREGNANCY ............................................................................. .8126 2.3 2.6

379 ... 14 MED THREATENED ABORTION ......................................................................... .4028 2.1 2.9

380 ... 14 MED ABORTION W/O D&C ................................................................................. .3501 1.5 1.8

381 ... 14 SURG ABORTION W D&C, ASPIRATION CURETTAGE OR HYSTEROTOMY .. .4809 1.7 2.3

382 ... 14 MED FALSE LABOR ............................................................................................ .2086 1.2 1.3

383 ... 14 MED OTHER ANTEPARTUM DIAGNOSES W MEDICAL COMPLICATIONS ... .4636 2.8 3.8
Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations 46087

TABLE 5.—LIST OF DIAGNOSIS RELATED GROUPS (DRGS), RELATIVE WEIGHTING FACTORS, GEOMETRIC AND ARITHMETIC

MEAN LENGTH OF STAY—Continued

Relative

weights

Geometric

mean LOS

Arithmetic

mean LOS

384 ... 14 MED OTHER ANTEPARTUM DIAGNOSES W/O MEDICAL COMPLICATIONS .3539 2.0 2.8

385 ... 15 * NEONATES, DIED OR TRANSFERRED TO ANOTHER ACUTE CARE

FACILITY.

1.3665 1.8 1.8

386 ... 15 *EXTREME IMMATURITY OR RESPIRATORY DISTRESS SYNDROME,

NEONATE.

4.5063 17.9 17.9

387 ... 15 *PREMATURITY W MAJOR PROBLEMS .................................................. 3.0777 13.3 13.3

388 ... 15 *PREMATURITY W/O MAJOR PROBLEMS .............................................. 1.8570 8.6 8.6

389 ... 15 FULL TERM NEONATE W MAJOR PROBLEMS ....................................... 1.4862 5.1 6.3

390 ... 15 * NEONATE W OTHER SIGNIFICANT PROBLEMS .................................. 1.3058 3.4 3.4

391 ... 15 * NORMAL NEWBORN ................................................................................ .1515 3.1 3.1

392 ... 16 SURG SPLENECTOMY AGE >17 .......................................................................... 3.1695 8.1 10.6

393 ... 16 SURG *SPLENECTOMY AGE 0–17 ...................................................................... 1.3386 9.1 9.1

394 ... 16 SURG OTHER O.R. PROCEDURES OF THE BLOOD AND BLOOD FORMING

ORGANS.

1.6479 4.5 7.5

395 ... 16 MED RED BLOOD CELL DISORDERS AGE >17 ............................................... .8181 3.6 5.0

396 ... 16 MED RED BLOOD CELL DISORDERS AGE 0–17 ............................................. .6284 2.7 4.0

397 ... 16 MED COAGULATION DISORDERS .................................................................... 1.2679 4.2 5.8

398 ... 16 MED RETICULOENDOTHELIAL & IMMUNITY DISORDERS W CC .................. 1.2242 4.9 6.3

399 ... 16 MED RETICULOENDOTHELIAL & IMMUNITY DISORDERS W/O CC .............. .6836 3.2 4.0

400 ... 17 SURG LYMPHOMA & LEUKEMIA W MAJOR O.R. PROCEDURE ...................... 2.6402 6.3 9.7

401 ... 17 SURG LYMPHOMA & NON-ACUTE LEUKEMIA W OTHER O.R. PROC W CC 2.5653 8.1 11.7

402 ... 17 SURG LYMPHOMA & NON-ACUTE LEUKEMIA W OTHER O.R. PROC W/O

CC.

1.0145 2.9 4.2

403 ... 17 MED LYMPHOMA & NON-ACUTE LEUKEMIA W CC ........................................ 1.6964 6.0 8.6

404 ... 17 MED LYMPHOMA & NON-ACUTE LEUKEMIA W/O CC .................................... .7917 3.3 4.6

405 ... 17 *ACUTE LEUKEMIA W/O MAJOR O.R. PROCEDURE AGE 0–17 ........... 1.8978 4.9 4.9

406 ... 17 SURG MYELOPROLIF DISORD OR POORLY DIFF NEOPL W MAJ O.R.PROC

W CC.

2.6147 7.3 10.1

407 ... 17 SURG MYELOPROLIF DISORD OR POORLY DIFF NEOPL W MAJ O.R.

PROC W/O CC.

1.1516 3.5 4.4

408 ... 17 SURG MYELOPROLIF DISORD OR POORLY DIFF NEOPL W OTHER

O.R.PROC.

1.7294 4.7 7.6

409 ... 17 MED RADIOTHERAPY ......................................................................................... .9534 4.3 5.9

410 ... 17 MED CHEMOTHERAPY W/O ACUTE LEUKEMIA AS SECONDARY DIAGNOSIS..7968 2.6 3.4

411 ... 17 MED HISTORY OF MALIGNANCY W/O ENDOSCOPY ..................................... .4214 1.8 2.3

412 ... 17 MED HISTORY OF MALIGNANCY W ENDOSCOPY ......................................... .5175 2.4 3.4

413 ... 17 MED OTHER MYELOPROLIF DIS OR POORLY DIFF NEOPL DIAG W CC .... 1.3777 5.7 8.1

414 ... 17 MED OTHER MYELOPROLIF DIS OR POORLY DIFF NEOPL DIAG W/O CC .7041 3.2 4.6

415 ... 18 SURG O.R. PROCEDURE FOR INFECTIOUS & PARASITIC DISEASES ........... 3.5166 10.8 14.9

416 ... 18 MED SEPTICEMIA AGE >17 ............................................................................... 1.4797 5.8 7.7

417 ... 18 MED SEPTICEMIA AGE 0–17 ............................................................................. .7688 3.3 4.3

418 ... 18 MED POSTOPERATIVE & POST–TRAUMATIC INFECTIONS .......................... .9679 5.0 6.3

419 ... 18 MED FEVER OF UNKNOWN ORIGIN AGE >17 W CC ...................................... .8831 4.1 5.2

420 ... 18 MED FEVER OF UNKNOWN ORIGIN AGE >17 W/O CC .................................. .6064 3.2 4.0

421 ... 18 MED VIRAL ILLNESS AGE >17 ........................................................................... .7069 3.3 4.2

422 ... 18 MED VIRAL ILLNESS & FEVER OF UNKNOWN ORIGIN AGE 0–17 ................ .5347 2.7 3.8

423 ... 18 MED OTHER INFECTIOUS & PARASITIC DISEASES DIAGNOSES ................ 1.5690 5.8 8.0

424 ... 19 SURG O.R. PROCEDURE W PRINCIPAL DIAGNOSES OF MENTAL ILLNESS 2.4581 9.9 16.8

425 ... 19 MED ACUTE ADJUST REACT & DISTURBANCES OF PSYCHOSOCIAL

DYSFUNCTION.

.6857 3.2 4.4

426 ... 19 MED DEPRESSIVE NEUROSES ......................................................................... .5648 3.7 5.2

427 ... 19 MED NEUROSES EXCEPT DEPRESSIVE ......................................................... .5818 3.6 5.3

428 ... 19 MED DISORDERS OF PERSONALITY & IMPULSE CONTROL ........................ .6975 4.9 7.7

429 ... 19 MED ORGANIC DISTURBANCES & MENTAL RETARDATION ......................... .8728 5.4 7.9

430 ... 19 MED PSYCHOSES ............................................................................................... .8073 6.5 9.1

431 ... 19 MED CHILDHOOD MENTAL DISORDERS ......................................................... .8371 5.5 8.9

432 ... 19 MED OTHER MENTAL DISORDER DIAGNOSES .............................................. .7647 3.7 5.9

433 ... 20 ALCOHOL/DRUG ABUSE OR DEPENDENCE, LEFT AMA ...................... .3053 2.4 3.3

434 ... 20 ALC/DRUG ABUSE OR DEPEND, DETOX OR OTH SYMPT TREAT W

CC.

.6865 4.0 5.3

435 ... 20 ALC/DRUG ABUSE OR DEPEND, DETOX OR OTH SYMPT TREAT W/

O CC.

.4015 3.6 4.5

436 ... 20 ALC/DRUG DEPENDENCE W REHABILITATION THERAPY ................... .8110 11.5 14.1

437 ... 20 ALC/DRUG DEPENDENCE, COMBINED REHAB & DETOX THERAPY .. .7343 8.3 9.9

438 ... ............ NO LONGER VALID .................................................................................... .0000 .0 .0

439 ... 21 SURG SKIN GRAFTS FOR INJURIES .................................................................. 1.6391 5.4 8.5

440 ... 21 SURG WOUND DEBRIDEMENTS FOR INJURIES ............................................... 1.8456 6.0 9.6

441 ... 21 SURG HAND PROCEDURES FOR INJURIES ...................................................... .9298 2.2 3.4

442 ... 21 SURG OTHER O.R. PROCEDURES FOR INJURIES W CC ................................ 2.1818 5.4 8.3
46088 Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations

TABLE 5.—LIST OF DIAGNOSIS RELATED GROUPS (DRGS), RELATIVE WEIGHTING FACTORS, GEOMETRIC AND ARITHMETIC

MEAN LENGTH OF STAY—Continued

Relative

weights

Geometric

mean LOS

Arithmetic

mean LOS

443 ... 21 SURG OTHER O.R. PROCEDURES FOR INJURIES W/O CC ............................ .9116 2.5 3.4

444 ... 21 MED TRAUMATIC INJURY AGE >17 W CC ....................................................... .7007 3.7 4.8

445 ... 21 MED TRAUMATIC INJURY AGE >17 W/O CC ................................................... .4842 2.6 3.7

446 ... 21 MED * TRAUMATIC INJURY AGE 0–17 .............................................................. .2942 2.4 2.4

447 ... 21 MED ALLERGIC REACTIONS AGE >17 ............................................................. .4927 2.0 2.6

448 ... 21 MED ALLERGIC REACTIONS AGE 0–17 ........................................................... .0968 1.0 1.0

449 ... 21 MED POISONING & TOXIC EFFECTS OF DRUGS AGE >17 W CC ................ .7860 2.8 4.1

450 ... 21 MED POISONING & TOXIC EFFECTS OF DRUGS AGE >17 W/O CC ............ .4406 1.7 2.2

451 ... 21 MED *POISONING & TOXIC EFFECTS OF DRUGS AGE 0–17 ....................... .2613 2.1 2.1

452 ... 21 MED COMPLICATIONS OF TREATMENT W CC ............................................... .9476 3.7 5.2

453 ... 21 MED COMPLICATIONS OF TREATMENT W/O CC ........................................... .4960 2.3 3.1

454 ... 21 MED OTHER INJURY, POISONING & TOXIC EFFECT DIAG W CC ................ .9035 3.3 5.2

455 ... 21 MED OTHER INJURY, POISONING & TOXIC EFFECT DIAG W/O CC ............ .4453 2.0 2.7

456 ... 22 BURNS, TRANSFERRED TO ANOTHER ACUTE CARE FACILITY ......... 1.7396 3.7 7.3

457 ... 22 MED EXTENSIVE BURNS W/O O.R. PROCEDURE .......................................... 1.5860 2.5 4.9

458 ... 22 SURG NON-EXTENSIVE BURNS W SKIN GRAFT .............................................. 3.5746 11.1 16.0

459 ... 22 SURG NON-EXTENSIVE BURNS W WOUND DEBRIDEMENT OR OTHER

O.R. PROC.

1.5588 6.5 9.3

460 ... 22 MED NON-EXTENSIVE BURNS W/O O.R. PROCEDURE ................................. .9421 4.4 6.3

461 ... 23 SURG O.R. PROC W DIAGNOSES OF OTHER CONTACT W HEALTH SERVICES.1.0123 2.5 4.6

462 ... 23 MED REHABILITATION ....................................................................................... 1.4041 10.5 13.1

463 ... 23 MED SIGNS & SYMPTOMS W CC ..................................................................... .6907 3.6 4.8

464 ... 23 MED SIGNS & SYMPTOMS W/O CC .................................................................. .4872 2.7 3.4

465 ... 23 MED AFTERCARE W HISTORY OF MALIGNANCY AS SECONDARY DIAGNOSIS..5858 2.2 3.8

466 ... 23 MED AFTERCARE W/O HISTORY OF MALIGNANCY AS SECONDARY DIAGNOSIS..6336 2.6 4.7

467 ... 23 MED OTHER FACTORS INFLUENCING HEALTH STATUS .............................. .4669 2.3 4.2

468 ... ............ EXTENSIVE O.R. PROCEDURE UNRELATED TO PRINCIPAL DIAGNOSIS.3.6202 9.9 14.2

469 ... ............ **PRINCIPAL DIAGNOSIS INVALID AS DISCHARGE DIAGNOSIS ......... .0000 .0 .0

470 ... ............ ** UNGROUPABLE ...................................................................................... .0000 .0 .0

471 ... 08 SURG BILATERAL OR MULTIPLE MAJOR JOINT PROCS OF LOWER EXTREMITY.3.4771 5.8 6.7

472 ... 22 SURG EXTENSIVE BURNS W O.R. PROCEDURE .............................................. 10.2429 11.8 24.2

473 ... 17 ACUTE LEUKEMIA W/O MAJOR O.R. PROCEDURE AGE >17 .............. 3.4853 7.9 13.6

474 ... ............ NO LONGER VALID .................................................................................... .0000 .0 .0

475 ... 04 MED RESPIRATORY SYSTEM DIAGNOSIS WITH VENTILATOR SUPPORT 3.7291 8.2 11.6

476 ... ............ SURG PROSTATIC O.R. PROCEDURE UNRELATED TO PRINCIPAL DIAGNOSIS.2.2234 9.5 12.7

477 ... ............ SURG NON-EXTENSIVE O.R. PROCEDURE UNRELATED TO PRINCIPAL DIAGNOSIS.1.7461 5.5 8.6

478 ... 05 SURG OTHER VASCULAR PROCEDURES W CC .............................................. 2.2981 5.2 7.7

479 ... 05 SURG OTHER VASCULAR PROCEDURES W/O CC .......................................... 1.4113 3.2 4.2

480 ... ............ SURG LIVER TRANSPLANT .................................................................................. 11.4672 19.0 25.3

481 ... ............ SURG BONE MARROW TRANSPLANT ................................................................ 11.2821 26.5 30.2

482 ... ............ SURG TRACHEOSTOMY FOR FACE, MOUTH & NECK DIAGNOSES .............. 3.5999 10.5 13.5

483 ... ............ SURG TRACHEOSTOMY EXCEPT FOR FACE, MOUTH & NECK DIAGNOSES 16.0451 33.8 43.5

484 ... 24 SURG CRANIOTOMY FOR MULTIPLE SIGNIFICANT TRAUMA ......................... 5.7762 10.6 15.4

485 ... 24 SURG LIMB REATTACHMENT, HIP AND FEMUR PROC FOR MULTIPLE SIGNIFICANT TR.3.1562 8.3 10.6

486 ... 24 SURG OTHER O.R. PROCEDURES FOR MULTIPLE SIGNIFICANT TRAUMA 4.8882 8.8 13.5

487 ... 24 MED OTHER MULTIPLE SIGNIFICANT TRAUMA ............................................. 2.0229 5.9 8.3

488 ... 25 SURG HIV W EXTENSIVE O.R. PROCEDURE .................................................... 4.5078 12.1 18.0

489 ... 25 MED HIV W MAJOR RELATED CONDITION ..................................................... 1.8009 6.7 9.8

490 ... 25 MED HIV W OR W/O OTHER RELATED CONDITION ....................................... .9952 4.2 6.1

491 ... 08 SURG MAJOR JOINT & LIMB REATTACHMENT PROCEDURES OF UPPER

EXTREMITY.

1.6579 3.3 3.9

492 ... 17 MED CHEMOTHERAPY W ACUTE LEUKEMIA AS SECONDARY DIAGNOSIS.4.6393 11.9 18.0

493 ... 07 SURG LAPAROSCOPIC CHOLECYSTECTOMY W/O C.D.E. W CC ................... 1.7561 4.1 5.7

494 ... 07 SURG LAPAROSCOPIC CHOLECYSTECTOMY W/O C.D.E. W/O CC ............... .9400 1.8 2.4

495 ... ............ SURG LUNG TRANSPLANT .................................................................................. 9.5171 14.8 17.9

496 ... 08 SURG COMBINED ANTERIOR/POSTERIOR SPINAL FUSION ........................... 5.5214 9.2 11.6

497 ... 08 SURG SPINAL FUSION W CC .............................................................................. 2.7692 5.3 6.8

498 ... 08 SURG SPINAL FUSION W/O CC ........................................................................... 1.6171 3.1 3.8

499 ... 08 SURG BACK & NECK PROCS EXCEPT SPINAL FUSION W CC ....................... 1.4827 4.1 5.3

500 ... 08 SURG BACK & NECK PROCS EXCEPT SPINAL FUSION W/O CC ................... .9708 2.6 3.1

501 ... 08 SURG KNEE PROC W PDX OF INFECTION W CC ............................................. 2.5660 8.7 11.3
Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations 46089

TABLE 5.—LIST OF DIAGNOSIS RELATED GROUPS (DRGS), RELATIVE WEIGHTING FACTORS, GEOMETRIC AND ARITHMETIC

MEAN LENGTH OF STAY—Continued

Relative

weights

Geometric

mean LOS

Arithmetic

mean LOS

502 ... 08 SURG KNEE PROC W PDX OF INFECTION W/O CC ......................................... 1.6004 5.9 7.1

503 ... 08 SURG KNEE PROCEDURES W/O PDX OF INFECTION ..................................... 1.2380 3.4 4.4

* Medicare data have been supplemented by data from 19 states for low volume DRGs.

** DRGs 469 and 470 contain cases which could not be assigned to valid DRGs.

Note: Geometric mean is used only to determine payment for transfer cases.

Note: Arithmetic mean is used only to determine payment for outlier cases.

Note: Relative weights are based on medicare patient data and may not be appropriate for other patients.

TABLE 6A.—NEW DIAGNOSIS CODES

Diagnosis

code Description CC MDC DRG

007.4 Other protozoal intestinal diseases, cryptosporidiosis ............................... N 6 182, 183, 184

031.2 Disease due to disseminated mycobacterium avium-intracellulare complex (DMAC).N 18

25

423

489 1

038.10 Staphylococcal septicemia, unspecified ..................................................... Y 15

18

25

387, 389 2

416, 417

489 1

038.11 Staphylococcus aureus septicemia ............................................................ Y 15

18

25

387, 389 2

416, 417

489 1

038.19 Other staphylococcal septicemia ................................................................ Y 15

18

25

387, 389 2

416, 417

489 1

275.40 Unspecified disorder of calcium metabolism .............................................. N 10 296, 297, 298

275.41 Hypocalcemia .............................................................................................. N 10 296, 297, 298

275.42 Hypercalcemia ............................................................................................ N 10 296, 297, 298

275.49 Other disorder of calcium metabolism ........................................................ N 10 296, 297, 298

438.0 Late effect of cerebrovascular disease, cognitive deficits .......................... N 1 12

438.10 Late effect of cerebrovascular disease, speech and language deficits,

unspecified.

N 1 12

438.11 Late effect of cerebrovascular disease, speech and language deficits,

aphasia.

N 1 12

438.12 Late effect of cerebrovascular disease, speech and language deficits,

dysphasia.

N 1 12

438.19 Late effect of cerebrovascular disease, other speech and language deficits.N 1 12

438.20 Late effect of cerebrovascular disease, hemiplegia affecting unspecified

side.

N 1 12

438.21 Late effect of cerebrovascular disease, hemiplegia affecting dominant

side.

N 1 12

438.22 Late effect of cerebrovascular disease, hemiplegia affecting nondominant side.N 1 12

438.30 Late effect of cerebrovascular disease, monoplegia of upper limb affecting unspecified side.N 1 12

438.31 Late effect of cerebrovascular disease, monoplegia of upper limb affecting dominant side.N 1 12

438.32 Late effect of cerebrovascular disease, monoplegia of upper limb affecting nondominant side.N 1 12

438.40 Late effect of cerebrovascular disease, monoplegia of lower limb affecting unspecified side.N 1 12

438.41 Late effect of cerebrovascular disease, monoplegia of lower limb affecting dominant side.N 1 12

438.42 Late effect of cerebrovascular disease, monoplegia of lower limb affecting nondominant side.N 1 12

438.50 Late effect of cerebrovascular disease, other paralytic syndrome affecting unspecified side.N 1 12

438.51 Late effect of cerebrovascular disease, other paralytic syndrome affecting dominant side.N 1 12

438.52 Late effect of cerebrovascular disease, other paralytic syndrome affecting nondominant side.N 1 12

438.81 Other late effect of cerebrovascular disease, apraxia ................................ N 1 12

438.82 Other late effect of cerebrovascular disease, dysphagia ........................... N 1 12

438.89 Other late effects of cerebrovascular disease ............................................ N 1 12

438.9 Unspecified late effects of cerebrovascular disease .................................. N 1 12

458.8 Other specified hypotension ....................................................................... N 5 144, 145

121 3
46090 Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations

TABLE 6A.—NEW DIAGNOSIS CODES—Continued

Diagnosis

code Description CC MDC DRG

474.00 Chronic tonsillitis ......................................................................................... N pre

3

482

68, 69, 70

474.01 Chronic adenoiditis ..................................................................................... N pre

3

482

68, 69, 70

474.02 Chronic tonsillitis and adenoiditis ............................................................... N pre

3

482

68, 69, 70

482.84 Legionnaires’ disease ................................................................................. Y 4 79, 80, 81

518.6 Allergic bronchopulmonary aspergillosis .................................................... Y 4 92, 93

655.70 Decreased fetal movements unspecified as to episode of care or not applicable.N 14 469

655.71 Decreased fetal movements delivered, with or without mention of

antepartum condition.

N 14 370, 371, 372, 373, 374,

375

655.73 Decreased fetal movements antepartum condition or complication .......... N 14 383, 384

686.00 Other local infection of skin and subcutaneous tissue, pyoderma, unspecified.N 9 277, 278, 279

686.01 Other local infection of skin and subcutaneous tissue, pyoderma

gangrenosum.

N 9 277, 278, 279

686.09 Other local infection of skin and subcutaneous tissue, other pyoderma ... N 9 277, 278, 279

756.70 Congenital anomaly of abdominal wall, unspecified .................................. N 6 188, 189, 190

756.71 Congenital anomaly of abdominal wall, prune belly syndrome .................. N 6 188, 189, 190

756.79 Other congenital anomalies of abdominal wall ........................................... N 6 188, 189, 190

780.31 Febrile convulsions ..................................................................................... Y 1

15

24, 25, 26

387, 389 2

780.39 Other convulsions ....................................................................................... Y 1

15

24, 25, 26

387, 389 2

790.94 Other nonspecific findings on examination of blood, euthyroid sick syndrome.N 23 463, 464

796.5 Abnormal findings on antenatal screening ................................................. N 14 383, 384

959.01 Head injury, unspecified ............................................................................. N pre

21

24

482

444, 445, 446

significant trauma list

959.09 Injury of face and neck ............................................................................... N pre

21

24

482

444, 445, 446

significant trauma list

V02.60 Viral hepatitis carrier, unspecified ............................................................... N 7 205, 206

V02.61 Hepatitis B carrier ....................................................................................... N 7 205, 206

V02.62 Hepatitis C carrier ....................................................................................... N 7 205, 206

V02.69 Other viral hepatitis carrier ......................................................................... N 7 205, 206

V12.40 Personal history of unspecified disorder of nervous system and sense

organs.

N 23 467

V12.41 Personal history of benign neoplasm of the brain ...................................... N 23 467

V12.49 Personal history of other disorder of nervous system and sense organs N 23 467

V16.40 Family history of malignant neoplasm of genital organ, unspecified ......... N 23 467

V16.41 Family history of malignant neoplasm of ovary .......................................... N 23 467

V16.42 Family history of malignant neoplasm of prostate ...................................... N 23 467

V16.43 Family history of malignant neoplasm of testis .......................................... N 23 467

V16.49 Family history of other malignant neoplasm ............................................... N 23 467

V28.6 Antenatal screening for streptococcus B .................................................... N 23 467

V42.81 Organ or tissue replaced by transplant, bone marrow ............................... Y 16 398, 399

V42.82 Organ or tissue replaced by transplant, peripheral stem cells ................... Y 16 398, 399

V42.83 Organ or tissue replaced by transplant, pancreas ..................................... Y 7 204

V42.89 Other organ or tissue replaced by transplant ............................................. Y 23 467

V45.61 Cataract extraction status ........................................................................... N 23 467

V45.69 Other states following surgery of eye and adnexa ..................................... N 23 467

V45.71 Acquired absence of breast ........................................................................ N 23 467

V45.72 Acquired absence of intestine (large) (small) ............................................. N 23 467

V45.73 Acquired absence of kidney ....................................................................... N 23 467

V53.01 Fitting and adjustment of cerebral ventricular (communicating) shunt ...... N 23 467

V53.02 Fitting and adjustment of neuropacemaker (brain) (peripheral nerve)

(Spinal cord).

N 23 467

V53.09 Fitting and adjustment of other devices related to nervous system and

special senses.

N 23 467

V64.4 Laparoscopic surgical procedure converted to open procedure ................ N 23 467

V76.10 Screening for malignant neoplasm, breast screening, unspecified ............ N 23 467

V76.11 Screening mammogram for high-risk patient, malignant neoplasm of

breast.

N 23 467

V76.12 Other screening mammogram for malignant neoplasm of breast .............. N 23 467

V76.19 Other screening breast examination for malignant neoplasm .................... N 23 467

1 HIV major related condition in this DRG.

2 Classified as a ‘‘major problem’’in these DRGs.

3 Classified as a ‘‘major complication’’ in this DRG.
Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations 46091

TABLE 6B.—NEW PROCEDURE CODES

Procedure

code Description OR MDC DRG

37.35 ........ Partial ventriculectomy ..................................................................................................................... Y 5 108

41.05 ........ Allogeneic hematopoietic stem cell transplant ................................................................................ Y pre 481

41.06 ........ Cord blood stem cell transplant ....................................................................................................... Y pre 481

TABLE 6C.—INVALID DIAGNOSIS CODES

Diagnosis

code Description CC MDC DRG

038.1 Staphylococcal septicemia .......................................................................... Y 15

18

25

387, 389 1

416, 417

489 2

275.4 Disorders of calcium metabolism ................................................................ N 10 296, 297, 298

438 Late effects of cerebrovascular disease ..................................................... N 1 12

474.0 Chronic tonsillitis and adenoiditis ............................................................... N pre

3

482

68, 69, 70

686.0 Other local infections of skin and subcutaneous tissue, pyoderma ........... N 9 277, 278, 279

756.7 Other congenital anomalies of abdominal wall ........................................... N 6 188, 189, 190

780.3 Convulsions ................................................................................................. Y 1

15

24, 25, 26

387, 389 1

959.0 Injury, other and unspecified of head, face, and neck ............................... N pre

21

24

482

444, 445, 446

significant trauma list

V02.6 Carrier or suspected carrier of viral hepatitis ............................................. N 7 205, 206

V12.4 Personal history of disorders of nervous system and sense organs ......... N 23 467

V16.4 Family history of malignant neoplasm of genital organs ............................ N 23 467

V42.8 Unspecified organ or tissue replaced by transplant ................................... Y 7 205, 206

V45.6 Other postsurgical state following surgery of eye and adnexa .................. N 23 467

V53.0 Fitting and adjustment of devices related to nervous system and special

senses.

N 23 467

V76.1 Special screening for malignant neoplasm of the breast ........................... N 23 467

1 Classified as a ‘‘major problem’’ in these DRGs.

2 HIV major related condition in this DRG.

TABLE 6D.—Revised Diagnosis Code Titles

Diagnosis

code Description CC MDC DRG

041.04 Streptococcus infection in conditions classified elsewhere and of unspecified site, Group D (Enterococcus).N 18 423
46092 Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations

TABLE 6E.—ADDITIONS TO THE CC EXCLUSIONS LIST

PAGE 1 OF 5 PAGES

CCs that are added to the list are in Table 6E—Additions to the CC Exclusions List. Each of the principal diagnoses is shown with an asterisk,

and the revisions to the CC Exclusions List are provided in an indented column immediately following the affected principal diagnosis.

*0031 48284 48284 48284 01176 01354 01643 01771

03810 *01140 *01186 *01795 01180 01355 01644 01772

03811 48284 48284 48284 01181 01356 01645 01773

03819 *01141 *01190 *01796 01182 01360 01646 01774

*0074 48284 48284 48284 01183 01361 01650 01775

00841 *01142 *01191 *0202 01184 01362 01651 01776

00842 48284 48284 03810 01185 01363 01652 01780

00843 *01143 *01192 03811 01186 01364 01653 01781

00844 48284 48284 03819 01190 01365 01654 01782

00845 *01144 *01193 *0212 01191 01366 01655 01783

00846 48284 48284 48284 01192 01380 01656 01784

00847 *01145 *01194 *0310 01193 01381 01660 01785

00849 48284 48284 48284 01194 01382 01661 01786

*01100 *01146 *01195 *0312 01195 01383 01662 01790

48284 48284 48284 01100 01196 01384 01663 01791

*01101 *01150 *01196 01101 01200 01385 01664 01792

48284 48284 48284 01102 01201 01386 01665 01793

*01102 *01151 *01200 01103 01202 01390 01666 01794

48284 48284 48284 01104 01203 01391 01670 01795

*01103 *01152 *01201 01105 01204 01392 01671 01796

48284 48284 48284 01106 01205 01393 01672 01800

*01104 *01153 *01202 01110 01206 01394 01673 01801

48284 48284 48284 01111 01210 01395 01674 01802

*01105 *01154 *01203 01112 01211 01396 01675 01803

48284 48284 48284 01113 01212 01400 01676 01804

*01106 *01155 *01204 01114 01213 01401 01690 01805

48284 48284 48284 01115 01214 01402 01691 01806

*01110 *01156 *01205 01116 01215 01403 01692 01880

48284 48284 48284 01120 01216 01404 01693 01881

*01111 *01160 *01206 01121 01300 01405 01694 01882

48284 48284 48284 01122 01301 01406 01695 01883

*01112 *01161 *01210 01123 01302 01480 01696 01884

48284 48284 48284 01124 01303 01482 01720 01885

*01113 *01162 *01211 01125 01304 01483 01721 01886

48284 48284 48284 01126 01305 01484 01722 01890

*01114 *01163 *01212 01130 01306 01485 01723 01891

48284 48284 48284 01131 01310 01486 01724 01892

*01115 *01164 *01213 01132 01311 01600 01725 01893

48284 48284 48284 01133 01312 01601 01726 01894

*01116 *01165 *01214 01134 01313 01602 01730 01895

48284 48284 48284 01135 01314 01603 01731 01896

*01120 *01166 *01215 01136 01315 01604 01732 0310

48284 48284 48284 01140 01316 01605 01733 *0362

*01121 *01170 *01216 01141 01320 01606 01734 03810

48284 48284 48284 01142 01321 01610 01735 03811

*01122 *01171 *01280 01143 01322 01611 01736 03819

48284 48284 48284 01144 01323 01612 01740 *0380

*01123 *01172 *01281 01145 01324 01613 01741 03810

48284 48284 48284 01146 01325 01614 01742 03811

*01124 *01173 *01282 01150 01326 01615 01743 03819

48284 48284 48284 01151 01330 01616 01744 *03810

*01125 *01174 *01283 01152 01331 01620 01745 0362

48284 48284 48284 01153 01332 01621 01746 0380

*01126 *01175 *01284 01154 01333 01622 01750 03810

48284 48284 48284 01155 01334 01623 01751 03811

*01130 *01176 *01285 01156 01335 01624 01752 03819

48284 48284 48284 01160 01336 01625 01753 0382

*01131 *01180 *01286 01161 01340 01626 01754 0383

48284 48284 48284 01162 01341 01630 01755 03840

*01132 *01181 *01790 01163 01342 01631 01756 03841

48284 48284 48284 01164 01343 01632 01760 03842

*01133 *01182 *01791 01165 01344 01633 01761 03843

48284 48284 48284 01170 01345 01634 01762 03844

*01134 *01183 *01792 01171 01346 01635 01763 03849

48284 48284 48284 01172 01350 01636 01764 0388

*01135 *01184 *01793 01173 01351 01640 01765 0389

48284 48284 48284 01174 01352 01641 01766 0545

*01136 *01185 *01794 01175 01353 01642 01770 *03811
Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations 46093

PAGE 2 OF 5 PAGES

0362 *0391 03819 *34550 48284 01196 *4838 48284

0380 48284 *04182 78031 *48283 01200 48284 *5078

03810 *04089 03810 78039 48284 01201 *4841 48284

03811 03810 03811 *34551 *48284 01202 48284 *5080

03819 03811 03819 78031 01100 01203 *4843 48284

0382 03819 *04183 78039 01101 01204 48284 *5081

0383 *04100 03810 *34560 01102 01205 *4845 48284

03840 03810 03811 78031 01103 01206 48284 *5088

03841 03811 03819 78039 01104 01210 *4846 48284

03842 03819 *04184 *34561 01105 01211 48284 *5089

03843 *04101 03810 78031 01106 01212 *4847 48284

03844 03810 03811 78039 01110 01213 48284 *5171

03849 03811 03819 *34570 01111 01214 *4848 48284

0388 03819 *04185 78031 01112 01215 48284 *5178

0389 *04102 03810 78039 01113 01216 *485 48284

0545 03810 03811 *34571 01114 0310 48284 *5186

*03819 03811 03819 78031 01115 11505 *486 5186

0362 03819 *04186 78039 01116 11515 48284 *51889

0380 *04103 03810 *34580 01120 1304 *4870 48284

03810 03810 03811 78031 01121 1363 48284 *5198

03811 03811 03819 78039 01122 481 *4871 48284

03819 03819 *04189 *34581 01123 4820 48284 5186

0382 *04104 03810 78031 01124 4821 *494 *5199

0383 03810 03811 78039 01125 4822 48284 48284

03840 03811 03819 *34590 01126 48230 *4950 5186

03841 03819 *0419 78031 01130 48231 48284 *5990

03842 *04105 03810 78039 01131 48232 *4951 99664

03843 03810 03811 *34591 01132 48239 48284 *65570

03844 03811 03819 78031 01133 4824 *4952 66500

03849 03819 *0545 78039 01134 48281 48284 66501

0388 *04109 03810 *3488 01135 48282 *4953 66503

0389 03810 03811 78031 01136 48283 48284 66510

0545 03811 03819 78039 01140 48284 *4954 66511

*0382 03819 *11505 *3489 01141 48289 48284 *65571

03810 *04110 48284 78031 01142 4829 *4955 66500

03811 03810 *11515 78039 01143 4830 48284 66501

03819 03811 48284 *34989 01144 4831 *4956 66503

*0383 03819 *11595 78031 01145 4838 48284 66510

03810 *04111 48284 78039 01146 4841 *4957 66511

03811 03810 *1221 *3499 01150 4843 48284 *65573

03819 03811 48284 78031 01151 4845 *4958 66500

*03840 03819 *1304 78039 01152 4846 48284 66501

03810 *04119 48284 *4800 01153 4847 *4959 66503

03811 03810 *1363 48284 01154 4848 48284 66510

03819 03811 48284 *4801 01155 485 *496 66511

*03841 03819 *1398 48284 01156 486 48284 *68600

03810 *0412 03810 *4802 01160 4870 *500 6800

03811 03810 03811 48284 01161 4950 48284 6801

03819 03811 03819 *4808 01162 4951 *501 6802

*03842 03819 *34500 48284 01163 4952 48284 6803

03810 *0413 78031 *4809 01164 4953 *502 6804

03811 03810 78039 48284 01165 4954 48284 6805

03819 03811 *34501 *481 01166 4955 *503 6806

*03843 03819 78031 48284 01170 4956 48284 6807

03810 *0414 78039 *4820 01171 4957 *504 6808

03811 03810 *34510 48284 01172 4958 48284 6809

03819 03811 78031 *4821 01173 4959 *505 6820

*03844 03819 78039 48284 01174 5060 48284 6821

03810 *0415 *34511 *4822 01175 5061 *5060 6822

03811 03810 78031 48284 01176 5070 48284 6823

03819 03811 78039 *48230 01180 5071 *5061 6825

*03849 03819 *3452 48284 01181 5078 48284 6826

03810 *0416 78031 *48231 01182 5080 *5062 6827

03811 03810 78039 48284 01183 5081 48284 6828

03819 03811 *3453 *48232 01184 5171 *5063 6829

*0388 03819 78031 48284 01185 *48289 48284 684

03810 *0417 78039 *48239 01186 48284 *5064 *68601

03811 03810 *34540 48284 01190 *4829 48284 6800

03819 03811 78031 *4824 01191 48284 *5069 6801

*0389 03819 78039 48284 01192 *4830 48284 6802

03810 *04181 *34541 *48281 01193 48284 *5070 6803

03811 03810 78031 48284 01194 *4831 48284 6804

03819 03811 78039 *48282 01195 48284 *5071 6805
46094 Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations

PAGE 3 OF 5 PAGES

6806 80019 80110 80220 80359 80450 85132 85223

6807 80020 80111 80221 80360 80451 85133 85224

6808 80021 80112 80222 80361 80452 85134 85225

6809 80022 80113 80223 80362 80453 85135 85226

6820 80023 80114 80224 80363 80454 85136 85229

6821 80024 80115 80225 80364 80455 85139 85230

6822 80025 80116 80226 80365 80456 85140 85231

6823 80026 80119 80227 80366 80459 85141 85232

6825 80029 80120 80228 80369 80460 85142 85233

6826 80030 80121 80229 80370 80461 85143 85234

6827 80031 80122 80230 80371 80462 85144 85235

6828 80032 80123 80231 80372 80463 85145 85236

6829 80033 80124 80232 80373 80464 85146 85239

684 80034 80125 80233 80374 80465 85149 85240

*68609 80035 80126 80234 80375 80466 85150 85241

6800 80036 80129 80235 80376 80469 85151 85242

6801 80039 80130 80236 80379 80470 85152 85243

6802 80040 80131 80237 80380 80471 85153 85244

6803 80041 80132 80238 80381 80472 85154 85245

6804 80042 80133 80239 80382 80473 85155 85246

6805 80043 80134 8024 80383 80474 85156 85249

6806 80044 80135 8025 80384 80475 85159 85250

6807 80045 80136 8026 80385 80476 85160 85251

6808 80046 80139 8027 80386 80479 85161 85252

6809 80049 80140 8028 80389 80480 85162 85253

6820 80050 80141 8029 80390 80481 85163 85254

6821 80051 80142 80300 80391 80482 85164 85255

6822 80052 80143 80301 80392 80483 85165 85256

6823 80053 80144 80302 80393 80484 85166 85259

6825 80054 80145 80303 80394 80485 85169 85300

6826 80055 80146 80304 80395 80486 85170 85301

6827 80056 80149 80305 80396 80489 85171 85302

6828 80059 80150 80306 80399 80490 85172 85303

6829 80060 80151 80309 80400 80491 85173 85304

684 80061 80152 80310 80401 80492 85174 85305

*74861 80062 80153 80311 80402 80493 85175 85306

48284 80063 80154 80312 80403 80494 85176 85309

*7790 80064 80155 80313 80404 80495 85179 85310

78031 80065 80156 80314 80405 80496 85180 85311

78039 80066 80159 80315 80406 80499 85181 85312

*7791 80069 80160 80316 80409 8500 85182 85313

78031 80070 80161 80319 80410 8501 85183 85314

78039 80071 80162 80320 80411 8502 85184 85315

*78031 80072 80163 80321 80412 8503 85185 85316

78031 80073 80164 80322 80413 8504 85186 85319

78039 80074 80165 80323 80414 8505 85189 85400

*78039 80075 80166 80324 80415 8509 85190 85401

78031 80076 80169 80325 80416 85100 85191 85402

78039 80079 80170 80326 80419 85101 85192 85403

*7809 80080 80171 80329 80420 85102 85193 85404

78031 80081 80172 80330 80421 85103 85194 85405

78039 80082 80173 80331 80422 85104 85195 85406

*79094 80083 80174 80332 80423 85105 85196 85409

7907 80084 80175 80333 80424 85106 85199 85410

*7998 80085 80176 80334 80425 85109 85200 85411

78031 80086 80179 80335 80426 85110 85201 85412

78039 80089 80180 80336 80429 85111 85202 85413

*95901 80090 80181 80339 80430 85112 85203 85414

80000 80091 80182 80340 80431 85113 85204 85415

80001 80092 80183 80341 80432 85114 85205 85416

80002 80093 80184 80342 80433 85115 85206 85419

80003 80094 80185 80343 80434 85116 85209 9251

80004 80095 80186 80344 80435 85119 85210 9252

80005 80096 80189 80345 80436 85120 85211 *95909

80006 80099 80190 80346 80439 85121 85212 80000

80009 80100 80191 80349 80440 85122 85213 80001

80010 80101 80192 80350 80441 85123 85214 80002

80011 80102 80193 80351 80442 85124 85215 80003

80012 80103 80194 80352 80443 85125 85216 80004

80013 80104 80195 80353 80444 85126 85219 80005

80014 80105 80196 80354 80445 85129 85220 80006

80015 80106 80199 80355 80446 85130 85221 80009

80016 80109 8021 80356 80449 85131 85222 80010
Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations 46095

PAGE 4 OF 5 PAGES

80011 80102 80193 80351 80442 85124 85215 V4282

80012 80103 80194 80352 80443 85125 85216 V4283

80013 80104 80195 80353 80444 85126 85219 V4289

80014 80105 80196 80354 80445 85129 85220 *99685

80015 80106 80199 80355 80446 85130 85221 V4281

80016 80109 8021 80356 80449 85131 85222 *99686

80019 80110 80220 80359 80450 85132 85223 V4283

80020 80111 80221 80360 80451 85133 85224 *99689

80021 80112 80222 80361 80452 85134 85225 V4289

80022 80113 80223 80362 80453 85135 85226 *V090

80023 80114 80224 80363 80454 85136 85229 03810

80024 80115 80225 80364 80455 85139 85230 03811

80025 80116 80226 80365 80456 85140 85231 03819

80026 80119 80227 80366 80459 85141 85232 *V091

80029 80120 80228 80369 80460 85142 85233 03810

80030 80121 80229 80370 80461 85143 85234 03811

80031 80122 80230 80371 80462 85144 85235 03819

80032 80123 80231 80372 80463 85145 85236 *V092

80033 80124 80232 80373 80464 85146 85239 03810

80034 80125 80233 80374 80465 85149 85240 03811

80035 80126 80234 80375 80466 85150 85241 03819

80036 80129 80235 80376 80469 85151 85242 *V093

80039 80130 80236 80379 80470 85152 85243 03810

80040 80131 80237 80380 80471 85153 85244 03811

80041 80132 80238 80381 80472 85154 85245 03819

80042 80133 80239 80382 80473 85155 85246 *V094

80043 80134 8024 80383 80474 85156 85249 03810

80044 80135 8025 80384 80475 85159 85250 03811

80045 80136 8026 80385 80476 85160 85251 03819

80046 80139 8027 80386 80479 85161 85252 *V0950

80049 80140 8028 80389 80480 85162 85253 03810

80050 80141 8029 80390 80481 85163 85254 03811

80051 80142 80300 80391 80482 85164 85255 03819

80052 80143 80301 80392 80483 85165 85256 *V0951

80053 80144 80302 80393 80484 85166 85259 03810

80054 80145 80303 80394 80485 85169 85300 03811

80055 80146 80304 80395 80486 85170 85301 03819

80056 80149 80305 80396 80489 85171 85302 *V096

80059 80150 80306 80399 80490 85172 85303 03810

80060 80151 80309 80400 80491 85173 85304 03811

80061 80152 80310 80401 80492 85174 85305 03819

80062 80153 80311 80402 80493 85175 85306 *V0970

80063 80154 80312 80403 80494 85176 85309 03810

80064 80155 80313 80404 80495 85179 85310 03811

80065 80156 80314 80405 80496 85180 85311 03819

80066 80159 80315 80406 80499 85181 85312 *V0971

80069 80160 80316 80409 8500 85182 85313 03810

80070 80161 80319 80410 8501 85183 85314 03811

80071 80162 80320 80411 8502 85184 85315 03819

80072 80163 80321 80412 8503 85185 85316 *V0980

80073 80164 80322 80413 8504 85186 85319 03810

80074 80165 80323 80414 8505 85189 85400 03811

80075 80166 80324 80415 8509 85190 85401 03819

80076 80169 80325 80416 85100 85191 85402 *V0981

80079 80170 80326 80419 85101 85192 85403 03810

80080 80171 80329 80420 85102 85193 85404 03811

80081 80172 80330 80421 85103 85194 85405 03819

80082 80173 80331 80422 85104 85195 85406 *V0990

80083 80174 80332 80423 85105 85196 85409 03810

80084 80175 80333 80424 85106 85199 85410 03811

80085 80176 80334 80425 85109 85200 85411 03819

80086 80179 80335 80426 85110 85201 85412 *V0991

80089 80180 80336 80429 85111 85202 85413 03810

80090 80181 80339 80430 85112 85203 85414 03811

80091 80182 80340 80431 85113 85204 85415 03819

80092 80183 80341 80432 85114 85205 85416 *V4283

80093 80184 80342 80433 85115 85206 85419 V4283

80094 80185 80343 80434 85116 85209 9251 *V4289

80095 80186 80344 80435 85119 85210 9252 V420

80096 80189 80345 80436 85120 85211 *99664 V421

80099 80190 80346 80439 85121 85212 5990 V422

80100 80191 80349 80440 85122 85213 *99680 V426

80101 80192 80350 80441 85123 85214 V4281 V427
46096 Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations

PAGE 5 OF 5 PAGES

V4289

*V429

V4281

V4282

V4283

V4289
Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations 46097

TABLE 6F.—DELETIONS TO THE CC EXCLUSIONS LIST

PAGE 1 OF 2 PAGES

CCs that are deleted from the list are in Table 6F—Deletions to the CC Exclusions List. Each of the principal diagnoses is shown with an

asterisk, and the revisions to the CC Exclusions List are provided in an indented column immediately following the affected principal diagnosis.

*0031 0381 7803 80039 80123 80226 80360 80444

0381 *0414 *34989 80040 80124 80227 80361 80445

*0202 0381 7803 80041 80125 80228 80362 80446

0381 *0415 *3499 80042 80126 80229 80363 80449

*0362 0381 7803 80043 80129 80230 80364 80450

0381 *0416 *6860 80044 80130 80231 80365 80451

*0380 0381 6800 80045 80131 80232 80366 80452

0381 *0417 6801 80046 80132 80233 80369 80453

*0381 0381 6802 80049 80133 80234 80370 80454

0362 *04181 6803 80050 80134 80235 80371 80455

0380 0381 6804 80051 80135 80236 80372 80456

0381 *04182 6805 80052 80136 80237 80373 80459

0382 0381 6806 80053 80139 80238 80374 80460

0383 *04183 6807 80054 80140 80239 80375 80461

03840 0381 6808 80055 80141 8024 80376 80462

03841 *04184 6809 80056 80142 8025 80379 80463

03842 0381 6820 80059 80143 8026 80380 80464

03843 *04185 6821 80060 80144 8027 80381 80465

03844 0381 6822 80061 80145 8028 80382 80466

03849 *04186 6823 80062 80146 8029 80383 80469

0388 0381 6825 80063 80149 80300 80384 80470

0389 *04189 6826 80064 80150 80301 80385 80471

0545 0381 6827 80065 80151 80302 80386 80472

*0382 *0419 6828 80066 80152 80303 80389 80473

0381 0381 6829 80069 80153 80304 80390 80474

*0383 *0545 684 80070 80154 80305 80391 80475

0381 0381 *7790 80071 80155 80306 80392 80476

*03840 *1398 7803 80072 80156 80309 80393 80479

0381 0381 *7791 80073 80159 80310 80394 80480

*03841 *34500 7803 80074 80160 80311 80395 80481

0381 7803 *7803 80075 80161 80312 80396 80482

*03842 *34501 7803 80076 80162 80313 80399 80483

0381 7803 *7809 80079 80163 80314 80400 80484

*03843 *34510 7803 80080 80164 80315 80401 80485

0381 7803 *7998 80081 80165 80316 80402 80486

*03844 *34511 7803 80082 80166 80319 80403 80489

0381 7803 *9590 80083 80169 80320 80404 80490

*03849 *3452 80000 80084 80170 80321 80405 80491

0381 7803 80001 80085 80171 80322 80406 80492

*0388 *3453 80002 80086 80172 80323 80409 80493

0381 7803 80003 80089 80173 80324 80410 80494

*0389 *34540 80004 80090 80174 80325 80411 80495

0381 7803 80005 80091 80175 80326 80412 80496

*04089 *34541 80006 80092 80176 80329 80413 80499

0381 7803 80009 80093 80179 80330 80414 8500

*04100 *34550 80010 80094 80180 80331 80415 8501

0381 7803 80011 80095 80181 80332 80416 8502

*04101 *34551 80012 80096 80182 80333 80419 8503

0381 7803 80013 80099 80183 80334 80420 8504

*04102 *34560 80014 80100 80184 80335 80421 8505

0381 7803 80015 80101 80185 80336 80422 8509

*04103 *34561 80016 80102 80186 80339 80423 85100

0381 7803 80019 80103 80189 80340 80424 85101

*04104 *34570 80020 80104 80190 80341 80425 85102

0381 7803 80021 80105 80191 80342 80426 85103

*04105 *34571 80022 80106 80192 80343 80429 85104

0381 7803 80023 80109 80193 80344 80430 85105

*04109 *34580 80024 80110 80194 80345 80431 85106

0381 7803 80025 80111 80195 80346 80432 85109

*04110 *34581 80026 80112 80196 80349 80433 85110

0381 7803 80029 80113 80199 80350 80434 85111

*04111 *34590 80030 80114 8021 80351 80435 85112

0381 7803 80031 80115 80220 80352 80436 85113

*04119 *34591 80032 80116 80221 80353 80439 85114

0381 7803 80033 80119 80222 80354 80440 85115

*0412 *3488 80034 80120 80223 80355 80441 85116

0381 7803 80035 80121 80224 80356 80442 85119

*0413 *3489 80036 80122 80225 80359 80443 85120
46098 Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations

PAGE 2 OF 2 PAGES

85121 85212 V428

85122 85213 *99686

85123 85214 V428

85124 85215 *99689

85125 85216 V428

85126 85219 *V090

85129 85220 0381

85130 85221 *V091

85131 85222 0381

85132 85223 *V092

85133 85224 0381

85134 85225 *V093

85135 85226 0381

85136 85229 *V094

85139 85230 0381

85140 85231 *V0950

85141 85232 0381

85142 85233 *V0951

85143 85234 0381

85144 85235 *V096

85145 85236 0381

85146 85239 *V0970

85149 85240 0381

85150 85241 *V0971

85151 85242 0381

85152 85243 *V0980

85153 85244 0381

85154 85245 *V0981

85155 85246 0381

85156 85249 *V0990

85159 85250 0381

85160 85251 *V0991

85161 85252 0381

85162 85253 *V428

85163 85254 V420

85164 85255 V421

85165 85256 V422

85166 85259 V426

85169 85300 V427

85170 85301 V428

85171 85302 *V429

85172 85303 V428

85173 85304

85174 85305

85175 85306

85176 85309

85179 85310

85180 85311

85181 85312

85182 85313

85183 85314

85184 85315

85185 85316

85186 85319

85189 85400

85190 85401

85191 85402

85192 85403

85193 85404

85194 85405

85195 85406

85196 85409

85199 85410

85200 85411

85201 85412

85202 85413

85203 85414

85204 85415

85205 85416

85206 85419

85209 9251

85210 9252

85211 *99680
Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations 46099

TABLE 7A.—MEDICARE PROSPECTIVE PAYMENT SYSTEM; SELECTED PERCENTILE LENGTHS OF STAY

[FY96 MEDPAR Update 06/97 Grouper V14.0]

DRG Number

discharges

Arithmetic

mean LOS

10th

percentile

25th

percentile

50th

percentile

75th

percentile

90th

percentile

1 .................................... 36951 10.0648 2 4 7 13 21

2 .................................... 6901 10.5740 3 5 8 13 21

3 .................................... 2 50.5000 1 1 100 100 100

4 .................................... 6300 8.4741 2 3 6 10 18

5 .................................... 103092 3.9356 1 2 3 4 8

6 .................................... 421 3.2470 1 1 2 4 7

7 .................................... 12078 11.7014 3 5 8 13 22

8 .................................... 2117 3.8427 1 1 3 5 8

9 .................................... 1748 7.1070 1 3 5 9 14

10 .................................. 20265 7.2705 2 3 5 9 15

11 .................................. 2958 4.2559 1 2 3 6 9

12 .................................. 26164 6.8367 2 3 5 8 13

13 .................................. 6421 5.7728 2 3 5 7 10

14 .................................. 377267 6.7453 2 3 5 8 13

15 .................................. 145885 4.0663 1 2 3 5 7

16 .................................. 14071 6.0968 2 3 5 7 11

17 .................................. 3095 3.6927 1 2 3 5 7

18 .................................. 24288 5.7924 2 3 4 7 11

19 .................................. 6604 4.0893 1 2 3 5 8

20 .................................. 8247 9.3961 2 4 7 12 19

21 .................................. 1192 7.1032 2 3 5 9 14

22 .................................. 2904 4.7600 2 2 4 6 9

23 .................................. 6081 4.5469 1 2 3 6 9

24 .................................. 58223 5.3289 1 2 4 6 10

25 .................................. 22286 3.6092 1 2 3 4 7

26 .................................. 42 5.0952 1 2 4 7 11

27 .................................. 3845 5.5004 1 1 3 7 13

28 .................................. 12715 6.3270 1 2 4 8 13

29 .................................. 4005 3.7231 1 2 3 5 7

30 .................................. 1 4.0000 4 4 4 4 4

31 .................................. 3086 4.7664 1 2 3 6 9

32 .................................. 1434 3.0718 1 1 2 3 6

34 .................................. 18587 5.8145 1 3 4 7 11

35 .................................. 3733 3.9207 1 2 3 5 7

36 .................................. 6765 1.5441 1 1 1 2 2

37 .................................. 1771 3.9283 1 1 3 5 8

38 .................................. 197 2.7411 1 1 2 3 5

39 .................................. 2564 2.0035 1 1 1 2 4

40 .................................. 2657 3.4159 1 1 2 4 7

42 .................................. 5414 1.9762 1 1 1 2 4

43 .................................. 111 3.9910 1 2 3 5 7

44 .................................. 1477 5.2275 2 3 4 7 9

45 .................................. 2356 3.6006 1 2 3 5 7

46 .................................. 3021 4.8431 1 2 4 6 9

47 .................................. 1182 3.9619 1 1 3 4 7

49 .................................. 2389 5.2704 1 2 4 6 10

50 .................................. 3294 2.1072 1 1 2 2 3

51 .................................. 351 2.8775 1 1 2 3 6

52 .................................. 91 3.0000 1 1 2 4 7

53 .................................. 3107 3.6028 1 1 2 4 8

54 .................................. 2 5.0000 1 1 9 9 9

55 .................................. 1907 2.9240 1 1 2 3 6

56 .................................. 749 2.8451 1 1 2 3 6

57 .................................. 659 3.9484 1 1 2 4 8

58 .................................. 1 2.0000 2 2 2 2 2

59 .................................. 106 3.3302 1 1 2 4 6

60 .................................. 3 1.0000 1 1 1 1 1

61 .................................. 243 4.5473 1 1 3 5 11

63 .................................. 3794 4.6009 1 2 3 5 9

64 .................................. 3378 6.6442 1 2 5 8 14

65 .................................. 29490 3.1698 1 2 3 4 6

66 .................................. 6602 3.4727 1 2 3 4 6

67 .................................. 495 3.8061 1 2 3 5 7

68 .................................. 10227 4.3213 2 2 4 5 8

69 .................................. 2963 3.4715 1 2 3 4 6

70 .................................. 40 3.3000 1 2 3 4 5

71 .................................. 128 3.9297 1 2 3 5 7

72 .................................. 725 3.4897 1 2 3 4 7

73 .................................. 6260 4.6725 1 2 4 6 9

74 .................................. 4 3.2500 1 1 2 3 7
46100 Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations

TABLE 7A.—MEDICARE PROSPECTIVE PAYMENT SYSTEM; SELECTED PERCENTILE LENGTHS OF STAY—Continued

[FY96 MEDPAR Update 06/97 Grouper V14.0]

DRG Number

discharges

Arithmetic

mean LOS

10th

percentile

25th

percentile

50th

percentile

75th

percentile

90th

percentile

75 .................................. 41372 10.5497 4 5 8 13 20

76 .................................. 41405 11.7204 3 6 9 14 22

77 .................................. 2204 5.0912 1 2 4 7 10

78 .................................. 31193 7.6312 3 5 7 9 13

79 .................................. 239360 8.6345 3 4 7 11 16

80 .................................. 8157 6.0829 2 3 5 7 11

81 .................................. 22 10.2727 1 6 8 11 15

82 .................................. 71319 7.3214 2 3 6 9 14

83 .................................. 7516 5.8950 2 3 5 7 11

84 .................................. 1542 3.4540 1 2 3 4 6

85 .................................. 20847 6.8707 2 3 5 9 13

86 .................................. 1389 4.0662 1 2 3 5 8

87 .................................. 67801 6.4419 1 3 5 8 12

88 .................................. 361166 5.6526 2 3 5 7 10

89 .................................. 430920 6.5608 3 4 5 8 12

90 .................................. 37020 4.6802 2 3 4 6 8

91 .................................. 77 5.1818 2 3 4 7 9

92 .................................. 13624 6.6358 2 3 5 8 12

93 .................................. 1172 4.6860 1 2 4 6 9

94 .................................. 13846 6.6439 2 3 5 8 13

95 .................................. 1449 3.9786 1 2 3 5 7

96 .................................. 59271 5.0562 2 3 4 6 9

97 .................................. 24153 3.9977 1 2 3 5 7

98 .................................. 29 2.8621 1 1 2 4 6

99 .................................. 26718 3.1667 1 1 2 4 6

100 ................................ 10247 2.2335 1 1 2 3 4

101 ................................ 20620 4.7299 1 2 4 6 9

102 ................................ 4570 2.8967 1 1 2 4 5

103 ................................ 538 47.8662 9 15 32 72 105

104 ................................ 26488 13.3264 5 8 11 16 24

105 ................................ 23028 10.2064 5 6 8 12 18

106 ................................ 107702 11.0480 6 7 9 13 18

107 ................................ 68747 8.3098 5 6 7 9 13

108 ................................ 7536 12.0882 4 7 10 15 23

110 ................................ 63731 10.0931 3 6 8 12 19

111 ................................ 5575 6.1189 2 4 6 7 9

112 ................................ 219732 4.2374 1 2 3 6 8

113 ................................ 48124 13.1573 4 6 9 16 26

114 ................................ 9126 8.8386 2 4 7 11 17

115 ................................ 11726 10.2988 4 6 8 13 18

116 ................................ 88158 5.0220 1 2 4 6 10

117 ................................ 3828 4.0470 1 1 3 5 9

118 ................................ 6772 3.0371 1 1 2 4 7

119 ................................ 1690 5.1065 1 1 3 7 11

120 ................................ 39847 8.4640 1 2 5 11 19

121 ................................ 167101 6.9259 2 4 6 9 12

122 ................................ 91350 4.6310 1 2 4 6 8

123 ................................ 46249 4.4859 1 1 2 6 11

124 ................................ 153500 4.5902 1 2 4 6 9

125 ................................ 61076 2.9372 1 1 2 4 6

126 ................................ 5166 12.8142 4 6 10 16 26

127 ................................ 709234 5.7990 2 3 5 7 11

128 ................................ 18597 6.3449 3 4 6 7 10

129 ................................ 4489 3.1644 1 1 1 3 7

130 ................................ 100017 6.2985 2 4 5 8 11

131 ................................ 25586 4.8476 1 3 5 6 8

132 ................................ 165201 3.3138 1 2 3 4 6

133 ................................ 6160 2.7940 1 1 2 3 5

134 ................................ 29603 3.6026 1 2 3 4 7

135 ................................ 8086 4.4369 1 2 3 5 8

136 ................................ 1150 3.0504 1 1 2 4 6

137 ................................ 5 6.6000 2 2 4 8 16

138 ................................ 208756 4.1947 1 2 3 5 8

139 ................................ 65753 2.7449 1 1 2 3 5

140 ................................ 135211 3.1677 1 2 3 4 6

141 ................................ 78555 4.0801 1 2 3 5 7

142 ................................ 35677 2.9447 1 1 2 4 5

143 ................................ 138162 2.3966 1 1 2 3 4

144 ................................ 76696 5.3747 1 2 4 7 11

145 ................................ 6380 2.9914 1 1 2 4 6
Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations 46101

TABLE 7A.—MEDICARE PROSPECTIVE PAYMENT SYSTEM; SELECTED PERCENTILE LENGTHS OF STAY—Continued

[FY96 MEDPAR Update 06/97 Grouper V14.0]

DRG Number

discharges

Arithmetic

mean LOS

10th

percentile

25th

percentile

50th

percentile

75th

percentile

90th

percentile

146 ................................ 9882 10.5266 6 7 9 12 17

147 ................................ 1674 6.9050 4 5 7 8 10

148 ................................ 149728 12.6192 6 7 10 15 22

149 ................................ 14277 7.1339 4 5 7 8 10

150 ................................ 24560 11.1072 4 6 9 14 20

151 ................................ 4267 6.1198 2 3 6 8 11

152 ................................ 4715 8.4846 4 5 7 10 14

153 ................................ 1651 5.7965 3 4 6 7 9

154 ................................ 35216 14.0534 4 7 11 17 27

155 ................................ 4555 5.0119 1 2 4 7 9

156 ................................ 4 10.7500 3 3 4 5 31

157 ................................ 9472 5.6010 1 2 4 7 11

158 ................................ 4361 2.7845 1 1 2 4 6

159 ................................ 18297 5.0699 1 2 4 6 10

160 ................................ 9547 2.7709 1 1 2 4 5

161 ................................ 14988 4.2180 1 2 3 5 9

162 ................................ 7391 2.0894 1 1 1 3 4

163 ................................ 11 4.4545 1 1 2 6 10

164 ................................ 5375 8.7116 4 5 7 10 15

165 ................................ 1597 5.4264 2 3 5 7 8

166 ................................ 3365 5.4155 2 3 4 7 10

167 ................................ 2278 2.9622 1 2 3 4 5

168 ................................ 1877 4.7475 1 2 3 6 9

169 ................................ 952 2.5620 1 1 2 3 5

170 ................................ 13057 11.7430 2 5 9 15 23

171 ................................ 1059 5.0888 1 2 4 6 10

172 ................................ 33117 7.3971 2 3 5 9 15

173 ................................ 2099 3.9700 1 2 3 5 8

174 ................................ 240184 5.1454 2 3 4 6 9

175 ................................ 21544 3.2351 1 2 3 4 6

176 ................................ 17948 5.7574 2 3 4 7 11

177 ................................ 11802 4.7312 2 3 4 6 8

178 ................................ 3790 3.3570 1 2 3 4 6

179 ................................ 12184 6.7228 2 3 5 8 13

180 ................................ 89240 5.6541 2 3 4 7 11

181 ................................ 21350 3.7182 1 2 3 5 7

182 ................................ 239229 4.5646 1 2 4 6 8

183 ................................ 70013 3.1776 1 2 3 4 6

184 ................................ 89 3.7191 1 2 3 4 7

185 ................................ 4134 4.8181 1 2 4 6 10

186 ................................ 3 3.6667 2 2 4 5 5

187 ................................ 932 3.9635 1 2 3 5 8

188 ................................ 70899 5.7808 1 3 4 7 11

189 ................................ 7941 3.3871 1 1 3 4 7

190 ................................ 99 4.8990 1 2 3 6 11

191 ................................ 11157 14.8611 4 7 11 18 30

192 ................................ 780 7.1346 2 4 6 9 12

193 ................................ 8380 12.9029 5 7 11 16 23

194 ................................ 663 7.5053 2 4 6 9 13

195 ................................ 8780 9.8539 4 6 8 12 17

196 ................................ 631 6.3376 3 4 6 8 10

197 ................................ 27389 8.6974 3 5 7 10 15

198 ................................ 7098 4.7201 2 3 4 6 8

199 ................................ 2177 10.7184 3 5 8 14 22

200 ................................ 1549 11.2608 2 4 8 14 23

201 ................................ 1562 15.0506 4 7 11 19 29

202 ................................ 28593 7.0940 2 3 5 9 14

203 ................................ 29628 7.1561 2 3 6 9 14

204 ................................ 53350 6.3392 2 3 5 8 12

205 ................................ 23158 6.7829 2 3 5 8 14

206 ................................ 1672 4.2189 1 2 3 5 8

207 ................................ 37032 5.2825 1 2 4 7 10

208 ................................ 9961 3.0344 1 1 2 4 6

209 ................................ 358501 5.8935 3 4 5 7 9

210 ................................ 143703 7.6287 4 5 6 9 13

211 ................................ 26316 5.6097 3 4 5 7 9

212 ................................ 41 6.1220 3 4 5 7 9

213 ................................ 7179 8.7551 2 4 7 11 17

214 ................................ 58431 5.8904 2 3 5 7 11

215 ................................ 45646 3.2827 1 2 3 4 6
46102 Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations

TABLE 7A.—MEDICARE PROSPECTIVE PAYMENT SYSTEM; SELECTED PERCENTILE LENGTHS OF STAY—Continued

[FY96 MEDPAR Update 06/97 Grouper V14.0]

DRG Number

discharges

Arithmetic

mean LOS

10th

percentile

25th

percentile

50th

percentile

75th

percentile

90th

percentile

216 ................................ 6407 10.2995 2 4 8 13 21

217 ................................ 20940 13.7538 3 5 9 17 29

218 ................................ 24873 5.6276 2 3 4 7 10

219 ................................ 18972 3.4441 1 2 3 4 6

220 ................................ 4 4.7500 1 1 4 4 10

221 ................................ 5180 7.1959 2 3 5 9 14

222 ................................ 3506 3.8189 1 2 3 5 7

223 ................................ 19625 2.6998 1 1 2 3 5

224 ................................ 8139 2.1058 1 1 2 3 4

225 ................................ 5926 4.6232 1 2 3 6 10

226 ................................ 5570 6.2548 1 2 4 7 13

227 ................................ 4376 2.8551 1 1 2 3 5

228 ................................ 2997 3.4525 1 1 2 4 7

229 ................................ 1232 2.3612 1 1 2 3 4

230 ................................ 2492 4.9767 1 2 3 6 10

231 ................................ 11066 4.7603 1 2 3 6 10

232 ................................ 556 4.2248 1 1 2 5 9

233 ................................ 4761 8.2728 2 3 6 10 17

234 ................................ 2195 3.8893 1 2 3 5 8

235 ................................ 5557 5.8101 1 3 4 6 11

236 ................................ 39976 5.5846 2 3 4 7 10

237 ................................ 1669 4.2151 1 2 3 5 8

238 ................................ 7672 9.3749 3 4 7 11 17

239 ................................ 60788 6.9705 2 3 5 8 13

240 ................................ 13393 6.9364 2 3 5 8 14

241 ................................ 3016 4.2338 1 2 3 5 8

242 ................................ 2855 7.1338 2 3 5 9 14

243 ................................ 80934 5.1228 2 3 4 6 9

244 ................................ 12524 5.4313 1 3 4 6 10

245 ................................ 4417 4.0906 1 2 3 5 7

246 ................................ 1276 4.2226 1 2 3 5 8

247 ................................ 11504 3.6954 1 2 3 5 7

248 ................................ 7427 4.9740 1 2 4 6 9

249 ................................ 10422 3.9731 1 1 3 5 8

250 ................................ 3591 4.6441 1 2 3 5 9

251 ................................ 2139 3.0108 1 1 2 4 5

253 ................................ 19173 5.2500 1 3 4 6 10

254 ................................ 9369 3.5203 1 2 3 4 6

255 ................................ 1 6.0000 6 6 6 6 6

256 ................................ 4438 5.6717 1 2 4 7 11

257 ................................ 22791 3.2063 1 2 3 4 6

258 ................................ 17069 2.2799 1 1 2 3 4

259 ................................ 4037 3.1962 1 1 2 3 7

260 ................................ 4576 1.6635 1 1 1 2 3

261 ................................ 2262 2.2396 1 1 2 3 4

262 ................................ 669 3.9746 1 1 3 5 8

263 ................................ 29336 12.5322 3 5 9 15 24

264 ................................ 3380 7.2843 2 3 6 9 14

265 ................................ 4205 7.2542 1 2 5 8 15

266 ................................ 2585 3.5528 1 1 2 5 7

267 ................................ 226 4.1770 1 1 2 5 8

268 ................................ 1218 3.7373 1 1 2 4 7

269 ................................ 10131 8.4881 2 3 6 11 17

270 ................................ 3100 3.2032 1 1 2 4 7

271 ................................ 23041 7.7309 3 4 6 9 14

272 ................................ 6022 6.6724 2 3 5 8 13

273 ................................ 1397 5.3672 1 2 4 6 11

274 ................................ 2648 7.1650 1 3 5 9 15

275 ................................ 243 3.8477 1 1 2 5 8

276 ................................ 953 4.7408 1 3 4 6 8

277 ................................ 80661 6.2256 2 3 5 7 11

278 ................................ 24965 4.8286 2 3 4 6 8

279 ................................ 7 4.4286 2 2 4 6 6

280 ................................ 14005 4.6941 1 2 3 6 9

281 ................................ 5939 3.3597 1 1 3 4 6

282 ................................ 5 12.0000 1 1 3 14 41

283 ................................ 5325 5.0186 1 2 4 6 10

284 ................................ 1764 3.5595 1 2 3 5 7

285 ................................ 5653 12.0637 3 5 9 15 23

286 ................................ 2085 7.1947 3 4 5 8 13
Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations 46103

TABLE 7A.—MEDICARE PROSPECTIVE PAYMENT SYSTEM; SELECTED PERCENTILE LENGTHS OF STAY—Continued

[FY96 MEDPAR Update 06/97 Grouper V14.0]

DRG Number

discharges

Arithmetic

mean LOS

10th

percentile

25th

percentile

50th

percentile

75th

percentile

90th

percentile

287 ................................ 6742 12.2094 3 5 8 14 24

288 ................................ 1244 5.8457 3 4 5 6 9

289 ................................ 5512 3.4799 1 1 2 3 7

290 ................................ 8856 2.5833 1 1 2 3 4

291 ................................ 93 2.1720 1 1 2 3 4

292 ................................ 5234 11.2042 2 4 8 14 22

293 ................................ 276 5.8406 1 2 4 7 11

294 ................................ 84535 5.2478 2 3 4 6 10

295 ................................ 3739 4.1038 1 2 3 5 8

296 ................................ 233162 5.7612 2 3 4 7 11

297 ................................ 32036 3.8589 1 2 3 5 7

298 ................................ 122 3.1066 1 1 2 4 6

299 ................................ 1152 5.4852 1 2 4 7 11

300 ................................ 15755 6.6292 2 3 5 8 13

301 ................................ 1988 4.3622 1 2 3 5 8

302 ................................ 8343 10.9475 5 6 8 13 19

303 ................................ 19359 9.4651 4 5 8 11 17

304 ................................ 13173 9.5951 2 4 7 12 19

305 ................................ 2468 4.3302 1 2 4 5 8

306 ................................ 11672 5.7598 1 2 4 7 12

307 ................................ 2489 2.5372 1 1 2 3 4

308 ................................ 9750 6.3917 1 2 4 8 13

309 ................................ 3377 2.5579 1 1 2 3 5

310 ................................ 27613 4.3385 1 2 3 5 9

311 ................................ 8533 2.0550 1 1 2 2 4

312 ................................ 1880 4.6824 1 2 3 6 10

313 ................................ 664 2.2846 1 1 2 3 5

315 ................................ 28798 8.5390 1 2 5 11 19

316 ................................ 85489 6.9920 2 3 5 9 14

317 ................................ 858 2.9231 1 1 2 3 6

318 ................................ 6203 6.6381 1 3 5 8 13

319 ................................ 433 2.8730 1 1 2 4 6

320 ................................ 176972 5.8722 2 3 5 7 10

321 ................................ 23634 4.2737 2 3 4 5 7

322 ................................ 102 4.4706 2 2 3 5 9

323 ................................ 17539 3.3728 1 1 2 4 7

324 ................................ 8050 2.0060 1 1 2 2 4

325 ................................ 7041 4.1976 1 2 3 5 8

326 ................................ 2111 2.9019 1 1 2 4 5

327 ................................ 15 3.1333 1 1 2 3 12

328 ................................ 678 3.9189 1 2 3 5 8

329 ................................ 108 2.4352 1 1 2 3 5

331 ................................ 44368 5.8405 2 3 4 7 11

332 ................................ 4485 3.5376 1 1 3 5 7

333 ................................ 348 5.6063 1 2 4 7 12

334 ................................ 19424 5.4204 3 4 5 6 8

335 ................................ 9808 4.0533 2 3 4 5 6

336 ................................ 59377 3.7626 1 2 3 4 7

337 ................................ 34315 2.4154 1 2 2 3 4

338 ................................ 3738 5.0698 1 2 3 6 11

339 ................................ 2131 4.5861 1 2 3 6 10

340 ................................ 1 1.0000 1 1 1 1 1

341 ................................ 5981 3.1155 1 1 2 3 6

342 ................................ 194 4.1649 1 2 3 6 8

344 ................................ 3544 3.1168 1 1 2 3 6

345 ................................ 1364 3.8043 1 1 3 5 8

346 ................................ 5207 6.2906 1 3 5 8 12

347 ................................ 382 2.9503 1 1 2 4 6

348 ................................ 3220 4.4851 1 2 3 5 8

349 ................................ 744 2.6788 1 1 2 3 5

350 ................................ 6367 4.6220 2 3 4 6 8

351 ................................ 2 2.5000 2 2 3 3 3

352 ................................ 551 3.9800 1 1 3 5 8

353 ................................ 2722 8.3420 3 4 6 9 16

354 ................................ 10008 5.9796 3 3 5 7 10

355 ................................ 5600 3.6289 2 3 3 4 5

356 ................................ 29930 2.8076 1 2 3 3 4

357 ................................ 6625 9.3250 4 5 7 11 17

358 ................................ 28909 4.4699 2 3 4 5 7

359 ................................ 28338 3.0915 2 2 3 4 4
46104 Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations

TABLE 7A.—MEDICARE PROSPECTIVE PAYMENT SYSTEM; SELECTED PERCENTILE LENGTHS OF STAY—Continued

[FY96 MEDPAR Update 06/97 Grouper V14.0]

DRG Number

discharges

Arithmetic

mean LOS

10th

percentile

25th

percentile

50th

percentile

75th

percentile

90th

percentile

360 ................................ 18232 3.2826 1 2 3 4 5

361 ................................ 680 3.6721 1 1 2 4 8

362 ................................ 1 1.0000 1 1 1 1 1

363 ................................ 3930 3.4725 1 2 2 3 7

364 ................................ 1869 3.4912 1 1 2 4 7

365 ................................ 2454 7.1520 1 2 4 9 16

366 ................................ 4504 6.9896 1 3 5 9 15

367 ................................ 546 2.9579 1 1 2 4 6

368 ................................ 2396 6.2371 2 3 5 8 12

369 ................................ 2388 3.4317 1 1 2 4 7

370 ................................ 1223 5.5078 2 3 4 5 9

371 ................................ 1108 3.5903 2 3 3 4 5

372 ................................ 909 3.1177 1 2 2 3 5

373 ................................ 4166 2.0290 1 1 2 2 3

374 ................................ 170 2.8824 1 2 2 3 4

375 ................................ 7 8.4286 1 2 5 9 15

376 ................................ 219 3.2055 1 1 2 4 7

377 ................................ 51 4.0196 1 1 2 4 9

378 ................................ 195 2.6256 1 2 2 3 4

379 ................................ 374 2.9278 1 1 2 3 5

380 ................................ 101 1.8317 1 1 1 2 4

381 ................................ 184 2.2935 1 1 1 2 5

382 ................................ 48 1.3333 1 1 1 1 2

383 ................................ 1616 3.8342 1 2 3 5 8

384 ................................ 142 2.8380 1 1 2 3 6

385 ................................ 5 4.6000 1 1 2 4 15

386 ................................ 1 49.0000 49 49 49 49 49

387 ................................ 1 62.0000 62 62 62 62 62

389 ................................ 24 7.1667 3 3 5 10 13

390 ................................ 12 5.3333 2 3 4 7 7

392 ................................ 2562 10.5863 4 5 8 13 21

393 ................................ 2 11.0000 7 7 15 15 15

394 ................................ 1814 7.5232 1 2 5 9 16

395 ................................ 68196 4.9807 1 2 4 6 10

396 ................................ 20 4.1500 1 1 2 7 7

397 ................................ 16987 5.7650 1 2 4 7 11

398 ................................ 18423 6.2558 2 3 5 8 12

399 ................................ 1310 4.0099 1 2 3 5 7

400 ................................ 7882 9.7265 2 3 7 12 21

401 ................................ 6799 11.6851 2 5 9 15 24

402 ................................ 1510 4.2391 1 1 3 6 9

403 ................................ 39216 8.5824 2 3 6 11 18

404 ................................ 3829 4.6453 1 2 4 6 9

406 ................................ 3486 10.0688 3 4 7 13 21

407 ................................ 700 4.4243 1 2 4 6 8

408 ................................ 2860 7.6731 1 2 5 9 18

409 ................................ 5606 5.9144 2 3 4 6 12

410 ................................ 74662 3.3563 1 2 3 4 5

411 ................................ 34 2.2941 1 1 1 3 6

412 ................................ 30 3.3667 1 1 2 5 7

413 ................................ 8828 8.0319 2 3 6 10 16

414 ................................ 735 4.5456 1 2 3 6 10

415 ................................ 44981 14.8907 4 7 11 18 29

416 ................................ 220088 7.6836 2 4 6 9 14

417 ................................ 55 4.5818 1 2 4 6 9

418 ................................ 20660 6.3190 2 3 5 8 12

419 ................................ 14953 5.2321 2 3 4 6 10

420 ................................ 2640 3.9807 1 2 3 5 7

421 ................................ 10782 4.2452 1 2 3 5 8

422 ................................ 90 3.7889 1 2 3 4 5

423 ................................ 10952 7.9356 2 3 6 9 16

424 ................................ 1953 16.5996 2 6 10 19 31

425 ................................ 15583 4.3857 1 2 3 5 8

426 ................................ 4758 5.2222 1 2 4 6 11

427 ................................ 1712 5.2652 1 2 4 7 11

428 ................................ 944 7.6684 1 3 5 9 16

429 ................................ 42557 7.8378 2 3 5 9 15

430 ................................ 56337 9.0138 2 4 7 11 18

431 ................................ 222 8.8694 2 3 5 9 17

432 ................................ 412 5.8422 1 2 3 7 12
Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations 46105

TABLE 7A.—MEDICARE PROSPECTIVE PAYMENT SYSTEM; SELECTED PERCENTILE LENGTHS OF STAY—Continued

[FY96 MEDPAR Update 06/97 Grouper V14.0]

DRG Number

discharges

Arithmetic

mean LOS

10th

percentile

25th

percentile

50th

percentile

75th

percentile

90th

percentile

433 ................................ 8265 3.2904 1 1 2 4 7

434 ................................ 22732 5.2870 2 3 4 6 10

435 ................................ 16634 4.5310 1 2 4 5 8

436 ................................ 3556 13.7657 4 8 13 20 26

437 ................................ 15721 9.9200 4 6 9 13 18

439 ................................ 1050 8.4581 1 3 6 10 18

440 ................................ 4863 9.5690 2 3 6 11 20

441 ................................ 617 3.4376 1 1 2 4 7

442 ................................ 15740 8.2971 1 3 6 10 17

443 ................................ 3008 3.3597 1 1 2 4 7

444 ................................ 3385 4.7634 1 2 4 6 9

445 ................................ 1251 3.6922 1 1 3 4 6

447 ................................ 4174 2.6416 1 1 2 3 5

448 ................................ 29 1.0000 1 1 1 1 1

449 ................................ 28968 4.0303 1 1 3 5 8

450 ................................ 6370 2.2462 1 1 1 2 4

451 ................................ 4 3.0000 1 1 1 2 8

452 ................................ 21590 5.1530 1 2 4 6 10

453 ................................ 3635 3.0908 1 1 2 4 6

454 ................................ 3990 5.1709 1 2 3 6 10

455 ................................ 908 2.7555 1 1 2 3 6

456 ................................ 215 7.2930 1 1 3 7 16

457 ................................ 113 4.8938 1 1 2 6 14

458 ................................ 1680 15.9685 3 6 12 21 33

459 ................................ 576 9.3247 2 4 7 12 19

460 ................................ 2331 6.3218 1 3 5 8 13

461 ................................ 3249 4.5940 1 1 2 5 11

462 ................................ 10116 12.9741 4 6 11 17 24

463 ................................ 13488 4.7710 1 2 4 6 9

464 ................................ 3208 3.4439 1 2 3 4 7

465 ................................ 214 3.7477 1 1 2 4 7

466 ................................ 1783 4.6983 1 1 2 5 10

467 ................................ 1616 4.2092 1 1 2 4 8

468 ................................ 63517 13.9982 3 6 11 18 28

471 ................................ 11672 6.7301 3 4 5 8 11

472 ................................ 203 24.2217 1 5 18 34 57

473 ................................ 8739 13.3296 2 4 7 19 34

475 ................................ 101069 11.4529 2 5 9 15 22

476 ................................ 6630 12.6427 3 7 11 16 23

477 ................................ 30337 8.0163 1 2 6 10 16

478 ................................ 127616 7.6905 1 3 6 10 16

479 ................................ 17990 4.1819 1 2 3 5 8

480 ................................ 552 28.5435 9 12 20 36 61

481 ................................ 157 34.0064 19 23 30 41 54

482 ................................ 7059 13.4577 5 7 10 15 24

483 ................................ 40160 43.1397 14 22 34 52 79

484 ................................ 407 15.4496 3 7 11 20 30

485 ................................ 3514 10.5552 4 5 8 12 20

486 ................................ 2589 13.2503 1 6 10 17 26

487 ................................ 4371 8.1078 2 3 6 10 16

488 ................................ 1774 16.5141 4 7 12 20 32

489 ................................ 19038 9.5586 2 4 7 12 20

490 ................................ 5460 6.0205 1 2 4 7 12

491 ................................ 10763 3.9181 2 2 3 4 7

492 ................................ 2229 17.9740 4 5 14 28 37

493 ................................ 56791 5.6668 1 2 4 7 11

494 ................................ 25112 2.3755 1 1 2 3 5

495 ................................ 140 16.9714 8 11 15 20 30

11173210

TABLE 7B.—MEDICARE PROSPECTIVE PAYMENT SYSTEM; SELECTED PERCENTILE LENGTHS OF STAY

[FY96 MEDPAR Update 06/97 Grouper V15.0]

DRG Number

discharges

Arithmetic

mean LOS

10th

percentile

25th

percentile

50th

percentile

75th

percentile

90th

percentile

1 .................................... 35984 10.2675 2 4 7 13 21

2 .................................... 6901 10.5740 3 5 8 13 21
46106 Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations

TABLE 7B.—MEDICARE PROSPECTIVE PAYMENT SYSTEM; SELECTED PERCENTILE LENGTHS OF STAY—Continued

[FY96 MEDPAR Update 06/97 Grouper V15.0]

DRG Number

discharges

Arithmetic

mean LOS

10th

percentile

25th

percentile

50th

percentile

75th

percentile

90th

percentile

3 .................................... 2 50.5000 1 1 100 100 100

4 .................................... 6301 8.4750 2 3 6 10 18

5 .................................... 103092 3.9356 1 2 3 4 8

6 .................................... 421 3.2470 1 1 2 4 7

7 .................................... 12609 11.3616 2 4 8 13 21

8 .................................... 2940 3.2000 1 1 2 4 7

9 .................................... 1754 7.1249 1 3 5 9 14

10 .................................. 20278 7.2768 2 3 5 9 15

11 .................................. 2956 4.2534 1 2 3 6 9

12 .................................. 26180 6.8448 2 3 5 8 13

13 .................................. 6419 5.7747 2 3 5 7 10

14 .................................. 377399 6.7458 2 3 5 8 13

15 .................................. 145920 4.0669 1 2 3 5 7

16 .................................. 14076 6.0979 2 3 5 7 11

17 .................................. 3098 3.6927 1 2 3 5 7

18 .................................. 25872 5.8632 2 3 4 7 11

19 .................................. 7162 4.1086 1 2 3 5 8

20 .................................. 6113 10.4880 2 5 8 14 21

21 .................................. 1193 7.1073 2 3 5 9 14

22 .................................. 2905 4.7621 2 2 4 6 9

23 .................................. 6083 4.5463 1 2 3 6 9

24 .................................. 58312 5.3301 1 2 4 6 10

25 .................................. 22307 3.6053 1 2 3 4 7

26 .................................. 47 4.7872 1 2 3 6 10

27 .................................. 3910 5.4939 1 1 3 7 13

28 .................................. 12971 6.3277 1 2 4 8 13

29 .................................. 4104 3.7210 1 2 3 5 7

31 .................................. 3167 4.8244 1 2 3 6 9

32 .................................. 1486 3.0606 1 1 2 3 6

34 .................................. 18601 5.8148 1 3 4 7 11

35 .................................. 3728 3.9144 1 2 3 5 7

36 .................................. 6766 1.5443 1 1 1 2 2

37 .................................. 1771 3.9283 1 1 3 5 8

38 .................................. 198 2.7374 1 1 2 3 5

39 .................................. 2565 2.0035 1 1 1 2 4

40 .................................. 2546 3.3342 1 1 2 4 7

42 .................................. 5437 1.9847 1 1 1 2 4

43 .................................. 112 3.9643 1 2 3 5 7

44 .................................. 1479 5.2427 2 3 4 7 9

45 .................................. 2358 3.6014 1 2 3 5 7

46 .................................. 3070 4.8485 1 2 4 6 9

47 .................................. 1208 3.9305 1 1 3 4 7

49 .................................. 2389 5.2704 1 2 4 6 10

50 .................................. 3294 2.1072 1 1 2 2 3

51 .................................. 351 2.8775 1 1 2 3 6

52 .................................. 109 3.2202 1 1 2 4 7

53 .................................. 3177 3.6116 1 1 2 4 8

54 .................................. 2 5.0000 1 1 9 9 9

55 .................................. 1907 2.9240 1 1 2 3 6

56 .................................. 749 2.8451 1 1 2 3 6

57 .................................. 627 3.9888 1 2 2 5 8

58 .................................. 1 2.0000 2 2 2 2 2

59 .................................. 106 3.3302 1 1 2 4 6

60 .................................. 3 1.0000 1 1 1 1 1

61 .................................. 243 4.5473 1 1 3 5 11

63 .................................. 3794 4.6009 1 2 3 5 9

64 .................................. 3378 6.6442 1 2 5 8 14

65 .................................. 29508 3.1713 1 2 3 4 6

66 .................................. 6602 3.4727 1 2 3 4 6

67 .................................. 495 3.8061 1 2 3 5 7

68 .................................. 10234 4.3211 2 2 4 5 8

69 .................................. 2957 3.4711 1 2 3 4 6

70 .................................. 40 3.3000 1 2 3 4 5

71 .................................. 128 3.9297 1 2 3 5 7

72 .................................. 754 3.5000 1 2 3 4 7

73 .................................. 6264 4.6727 1 2 4 6 9

74 .................................. 4 3.2500 1 1 2 3 7

75 .................................. 41373 10.5498 4 5 8 13 20

76 .................................. 41421 11.7212 3 6 9 14 22

77 .................................. 2200 5.0882 1 2 4 7 10
Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations 46107

TABLE 7B.—MEDICARE PROSPECTIVE PAYMENT SYSTEM; SELECTED PERCENTILE LENGTHS OF STAY—Continued

[FY96 MEDPAR Update 06/97 Grouper V15.0]

DRG Number

discharges

Arithmetic

mean LOS

10th

percentile

25th

percentile

50th

percentile

75th

percentile

90th

percentile

78 .................................. 31195 7.6312 3 5 7 9 13

79 .................................. 239461 8.6355 3 4 7 11 16

80 .................................. 8097 6.0569 2 3 5 7 11

81 .................................. 8 6.6250 2 3 6 7 10

82 .................................. 71327 7.3212 2 3 6 9 14

83 .................................. 7548 5.8922 2 3 5 7 11

84 .................................. 1550 3.4510 1 2 3 4 6

85 .................................. 20846 6.8720 2 3 5 9 13

86 .................................. 1392 4.0560 1 2 3 5 8

87 .................................. 67808 6.4421 1 3 5 8 12

88 .................................. 361207 5.6530 2 3 5 7 10

89 .................................. 431130 6.5624 3 4 5 8 12

90 .................................. 36919 4.6667 2 3 4 6 8

91 .................................. 44 4.3409 2 2 4 5 9

92 .................................. 13630 6.6374 2 3 5 8 12

93 .................................. 1171 4.6866 1 2 4 6 9

94 .................................. 13860 6.6431 2 3 5 8 13

95 .................................. 1450 3.9807 1 2 3 5 7

96 .................................. 59294 5.0564 2 3 4 6 9

97 .................................. 24137 3.9948 1 2 3 5 7

98 .................................. 23 3.8261 1 1 2 4 10

99 .................................. 26720 3.1667 1 1 2 4 6

100 ................................ 10247 2.2335 1 1 2 3 4

101 ................................ 20640 4.7304 1 2 4 6 9

102 ................................ 4568 2.8956 1 1 2 4 5

103 ................................ 532 48.1579 9 15 32 72 105

104 ................................ 26477 13.3305 5 8 11 16 24

105 ................................ 23042 10.2029 5 6 8 12 18

106 ................................ 107689 11.0481 6 7 9 13 18

107 ................................ 68745 8.3095 5 6 7 9 13

108 ................................ 7570 12.1110 4 7 10 15 23

110 ................................ 63724 10.0893 3 6 8 12 19

111 ................................ 5565 6.1146 2 4 6 7 9

112 ................................ 143226 4.2143 1 2 3 6 8

113 ................................ 48124 13.1573 4 6 9 16 26

114 ................................ 9126 8.8386 2 4 7 11 17

115 ................................ 13920 9.2104 2 4 8 12 17

116 ................................ 163845 4.7278 1 2 4 6 9

117 ................................ 3828 4.0470 1 1 3 5 9

118 ................................ 6772 3.0371 1 1 2 4 7

119 ................................ 1690 5.1065 1 1 3 7 11

120 ................................ 39847 8.4640 1 2 5 11 19

121 ................................ 171781 6.9297 2 4 6 9 12

122 ................................ 86714 4.5006 1 2 4 6 8

123 ................................ 46259 4.4861 1 1 2 6 11

124 ................................ 153509 4.5906 1 2 4 6 9

125 ................................ 61083 2.9375 1 1 2 4 6

126 ................................ 5166 12.8142 4 6 10 16 26

127 ................................ 709301 5.7991 2 3 5 7 11

128 ................................ 18599 6.3459 3 4 6 7 10

129 ................................ 4491 3.1639 1 1 1 3 7

130 ................................ 100064 6.2988 2 4 5 8 11

131 ................................ 25546 4.8443 1 3 5 6 8

132 ................................ 165210 3.3140 1 2 3 4 6

133 ................................ 6158 2.7943 1 1 2 3 5

134 ................................ 29610 3.6023 1 2 3 4 7

135 ................................ 8098 4.4395 1 2 3 5 8

136 ................................ 1153 3.0590 1 1 2 4 6

137 ................................ 3 9.0000 3 3 8 16 16

138 ................................ 208875 4.1968 1 2 3 5 8

139 ................................ 65773 2.7441 1 1 2 3 5

140 ................................ 135217 3.1677 1 2 3 4 6

141 ................................ 78828 4.0833 1 2 3 5 7

142 ................................ 35793 2.9455 1 1 2 4 5

143 ................................ 138166 2.3966 1 1 2 3 4

144 ................................ 76722 5.3753 1 2 4 7 11

145 ................................ 6376 2.9864 1 1 2 4 6

146 ................................ 9883 10.5263 6 7 9 12 17

147 ................................ 1673 6.9050 4 5 7 8 10

148 ................................ 149749 12.6194 6 7 10 15 22
46108 Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations

TABLE 7B.—MEDICARE PROSPECTIVE PAYMENT SYSTEM; SELECTED PERCENTILE LENGTHS OF STAY—Continued

[FY96 MEDPAR Update 06/97 Grouper V15.0]

DRG Number

discharges

Arithmetic

mean LOS

10th

percentile

25th

percentile

50th

percentile

75th

percentile

90th

percentile

149 ................................ 14256 7.1282 4 5 7 8 10

150 ................................ 24565 11.1079 4 6 9 14 20

151 ................................ 4262 6.1100 2 3 6 8 11

152 ................................ 4725 8.4855 4 5 7 10 14

153 ................................ 1641 5.7776 3 4 6 7 9

154 ................................ 35223 14.0521 4 7 11 17 27

155 ................................ 4548 5.0079 1 2 4 7 9

156 ................................ 4 10.7500 3 3 4 5 31

157 ................................ 9475 5.6004 1 2 4 7 11

158 ................................ 4358 2.7838 1 1 2 4 6

159 ................................ 18293 5.0712 1 2 4 6 10

160 ................................ 9550 2.7693 1 1 2 4 5

161 ................................ 14988 4.2188 1 2 3 5 9

162 ................................ 7392 2.0878 1 1 1 3 4

163 ................................ 10 4.7000 1 1 2 8 10

164 ................................ 5382 8.7124 4 5 7 10 15

165 ................................ 1590 5.4094 2 3 5 7 8

166 ................................ 3367 5.4164 2 3 4 7 10

167 ................................ 2276 2.9587 1 2 3 4 5

168 ................................ 1840 4.7288 1 2 3 6 9

169 ................................ 933 2.5638 1 1 2 3 5

170 ................................ 13057 11.7430 2 5 9 15 23

171 ................................ 1059 5.0888 1 2 4 6 10

172 ................................ 33120 7.3970 2 3 5 9 15

173 ................................ 2099 3.9700 1 2 3 5 8

174 ................................ 240349 5.1449 2 3 4 6 9

175 ................................ 21405 3.2299 1 2 3 4 6

176 ................................ 17949 5.7572 2 3 4 7 11

177 ................................ 11857 4.7298 2 3 4 6 8

178 ................................ 3735 3.3414 1 2 3 4 6

179 ................................ 12182 6.7201 2 3 5 8 13

180 ................................ 89279 5.6551 2 3 4 7 11

181 ................................ 21316 3.7131 1 2 3 5 7

182 ................................ 239438 4.5657 1 2 4 6 8

183 ................................ 69818 3.1716 1 2 3 4 6

184 ................................ 88 3.6364 1 2 3 4 7

185 ................................ 4173 4.8174 1 2 4 6 10

186 ................................ 3 3.6667 2 2 4 5 5

187 ................................ 932 3.9635 1 2 3 5 8

188 ................................ 70915 5.7802 1 3 4 7 11

189 ................................ 7922 3.3871 1 1 3 4 7

190 ................................ 99 4.9192 1 2 3 5 11

191 ................................ 11183 14.8821 4 7 11 18 30

192 ................................ 780 7.1308 2 4 6 9 12

193 ................................ 8399 12.9303 5 7 11 16 23

194 ................................ 660 7.4924 2 4 6 9 13

195 ................................ 8782 9.8539 4 6 8 12 17

196 ................................ 629 6.3259 3 4 6 8 10

197 ................................ 27404 8.6998 3 5 7 10 15

198 ................................ 7093 4.7194 2 3 4 6 8

199 ................................ 2178 10.7140 3 5 8 14 22

200 ................................ 1551 11.2863 2 4 8 14 23

201 ................................ 1566 15.0811 4 7 11 19 29

202 ................................ 28611 7.1039 2 3 5 9 14

203 ................................ 29634 7.1581 2 3 6 9 14

204 ................................ 53354 6.3393 2 3 5 8 12

205 ................................ 23176 6.8016 2 3 5 8 14

206 ................................ 1669 4.2109 1 2 3 5 8

207 ................................ 37050 5.2852 1 2 4 7 10

208 ................................ 9948 3.0293 1 1 2 4 6

209 ................................ 358501 5.8935 3 4 5 7 9

210 ................................ 143742 7.6286 4 5 6 9 13

211 ................................ 26310 5.6081 3 4 5 7 9

212 ................................ 10 5.2000 2 3 3 5 6

213 ................................ 7179 8.7551 2 4 7 11 17

216 ................................ 6407 10.2995 2 4 8 13 21

217 ................................ 20940 13.7538 3 5 9 17 29

218 ................................ 24871 5.6287 2 3 4 7 10

219 ................................ 18974 3.4430 1 2 3 4 6

220 ................................ 5 4.2000 1 1 4 4 10
Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations 46109

TABLE 7B.—MEDICARE PROSPECTIVE PAYMENT SYSTEM; SELECTED PERCENTILE LENGTHS OF STAY—Continued

[FY96 MEDPAR Update 06/97 Grouper V15.0]

DRG Number

discharges

Arithmetic

mean LOS

10th

percentile

25th

percentile

50th

percentile

75th

percentile

90th

percentile

223 ................................ 19625 2.6998 1 1 2 3 5

224 ................................ 8139 2.1058 1 1 2 3 4

225 ................................ 5926 4.6232 1 2 3 6 10

226 ................................ 5569 6.2550 1 2 4 7 13

227 ................................ 4377 2.8556 1 1 2 3 5

228 ................................ 2997 3.4525 1 1 2 4 7

229 ................................ 1232 2.3612 1 1 2 3 4

230 ................................ 2492 4.9767 1 2 3 6 10

231 ................................ 11065 4.7605 1 2 3 6 10

232 ................................ 556 4.2248 1 1 2 5 9

233 ................................ 4762 8.2740 2 3 6 10 17

234 ................................ 2194 3.8847 1 2 3 5 8

235 ................................ 5563 5.8068 1 3 4 6 11

236 ................................ 40042 5.5871 2 3 4 7 10

237 ................................ 1673 4.2110 1 2 3 5 8

238 ................................ 7672 9.3749 3 4 7 11 17

239 ................................ 60793 6.9705 2 3 5 8 13

240 ................................ 13396 6.9369 2 3 5 8 14

241 ................................ 3013 4.2273 1 2 3 5 8

242 ................................ 2855 7.1338 2 3 5 9 14

243 ................................ 80990 5.1239 2 3 4 6 9

244 ................................ 12531 5.4307 1 3 4 6 10

245 ................................ 4414 4.0888 1 2 3 5 7

246 ................................ 1275 4.2235 1 2 3 5 8

247 ................................ 11507 3.6954 1 2 3 5 7

248 ................................ 7430 4.9732 1 2 4 6 9

249 ................................ 10425 3.9777 1 1 3 5 8

250 ................................ 3638 4.6564 1 2 3 5 9

251 ................................ 2168 3.0152 1 1 2 4 5

253 ................................ 19268 5.2492 1 3 4 6 10

254 ................................ 9406 3.5232 1 2 3 4 6

256 ................................ 4463 5.6626 1 2 4 7 11

257 ................................ 22791 3.2065 1 2 3 4 6

258 ................................ 17067 2.2797 1 1 2 3 4

259 ................................ 4037 3.1962 1 1 2 3 7

260 ................................ 4576 1.6635 1 1 1 2 3

261 ................................ 2263 2.2391 1 1 2 3 4

262 ................................ 668 3.9790 1 1 3 5 8

263 ................................ 29345 12.5324 3 5 9 15 24

264 ................................ 3371 7.2691 2 3 6 9 14

265 ................................ 4204 7.2552 1 2 5 8 15

266 ................................ 2586 3.5526 1 1 2 5 7

267 ................................ 229 4.1441 1 1 2 5 8

268 ................................ 967 3.5274 1 1 2 4 7

269 ................................ 10146 8.4862 2 3 6 11 17

270 ................................ 3100 3.1906 1 1 2 4 7

271 ................................ 23041 7.7309 3 4 6 9 14

272 ................................ 6024 6.6718 2 3 5 8 13

273 ................................ 1395 5.3677 1 2 4 6 11

274 ................................ 2647 7.1598 1 3 5 9 15

275 ................................ 243 3.8477 1 1 2 5 8

276 ................................ 953 4.7408 1 3 4 6 8

277 ................................ 80718 6.2272 2 3 5 7 11

278 ................................ 24912 4.8206 2 3 4 6 8

279 ................................ 4 4.5000 2 2 2 6 8

280 ................................ 14160 4.6971 1 2 3 6 9

281 ................................ 6013 3.3597 1 1 3 4 6

282 ................................ 1 1.0000 1 1 1 1 1

283 ................................ 5329 5.0197 1 2 4 6 10

284 ................................ 1761 3.5548 1 2 3 5 7

285 ................................ 5653 12.0637 3 5 9 15 23

286 ................................ 2049 7.2674 3 4 5 8 13

287 ................................ 6697 12.1784 3 5 8 14 24

288 ................................ 1289 6.2289 2 4 5 6 9

289 ................................ 5512 3.4799 1 1 2 3 7

290 ................................ 8856 2.5833 1 1 2 3 4

291 ................................ 93 2.1720 1 1 2 3 4

292 ................................ 5255 11.1772 2 4 8 14 22

293 ................................ 292 5.6301 1 2 4 7 11

294 ................................ 84523 5.2489 2 3 4 6 10
46110 Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations

TABLE 7B.—MEDICARE PROSPECTIVE PAYMENT SYSTEM; SELECTED PERCENTILE LENGTHS OF STAY—Continued

[FY96 MEDPAR Update 06/97 Grouper V15.0]

DRG Number

discharges

Arithmetic

mean LOS

10th

percentile

25th

percentile

50th

percentile

75th

percentile

90th

percentile

295 ................................ 3775 4.0919 1 2 3 5 8

296 ................................ 233450 5.7617 2 3 4 7 11

297 ................................ 31861 3.8491 1 2 3 5 7

298 ................................ 104 2.5192 1 1 2 3 5

299 ................................ 1152 5.4852 1 2 4 7 11

300 ................................ 15757 6.6296 2 3 5 8 13

301 ................................ 1988 4.3622 1 2 3 5 8

302 ................................ 8343 10.9475 5 6 8 13 19

303 ................................ 19359 9.4651 4 5 8 11 17

304 ................................ 13176 9.5956 2 4 7 12 19

305 ................................ 2465 4.3209 1 2 4 5 8

306 ................................ 11670 5.7599 1 2 4 7 12

307 ................................ 2492 2.5385 1 1 2 3 4

308 ................................ 9657 6.4205 1 2 4 8 13

309 ................................ 3324 2.5827 1 1 2 3 5

310 ................................ 27618 4.3383 1 2 3 5 9

311 ................................ 8538 2.0546 1 1 2 2 4

312 ................................ 1883 4.6893 1 2 3 6 10

313 ................................ 670 2.2881 1 1 2 3 5

315 ................................ 28828 8.5433 1 2 5 11 19

316 ................................ 85493 6.9922 2 3 5 9 14

317 ................................ 858 2.9231 1 1 2 3 6

318 ................................ 6207 6.6441 1 3 5 8 13

319 ................................ 432 2.7940 1 1 2 4 6

320 ................................ 177076 5.8728 2 3 5 7 10

321 ................................ 23569 4.2659 2 3 4 5 7

322 ................................ 93 4.2796 2 2 3 5 8

323 ................................ 17541 3.3743 1 1 2 4 7

324 ................................ 8048 2.0035 1 1 2 2 4

325 ................................ 7066 4.1930 1 2 3 5 8

326 ................................ 2130 2.8793 1 1 2 3 5

327 ................................ 15 3.4667 1 1 2 3 12

328 ................................ 681 3.9236 1 2 3 5 8

329 ................................ 107 2.3458 1 1 2 3 5

331 ................................ 44033 5.8414 2 3 4 7 11

332 ................................ 4874 3.6574 1 1 3 5 7

333 ................................ 362 5.7127 1 2 4 7 12

334 ................................ 19427 5.4203 3 4 5 6 8

335 ................................ 9804 4.0529 2 3 4 5 6

336 ................................ 58837 3.7630 1 2 3 4 7

337 ................................ 34043 2.4114 1 2 2 3 4

338 ................................ 3738 5.0698 1 2 3 6 11

339 ................................ 2130 4.5873 1 2 3 6 10

340 ................................ 2 1.5000 1 1 2 2 2

341 ................................ 5981 3.1155 1 1 2 3 6

342 ................................ 1004 3.5926 1 2 3 4 7

344 ................................ 3544 3.1168 1 1 2 3 6

345 ................................ 1364 3.8043 1 1 3 5 8

346 ................................ 5207 6.2906 1 3 5 8 12

347 ................................ 382 2.9503 1 1 2 4 6

348 ................................ 3220 4.4969 1 2 3 5 8

349 ................................ 744 2.6788 1 1 2 3 5

350 ................................ 6367 4.6220 2 3 4 6 8

351 ................................ 2 2.5000 2 2 3 3 3

352 ................................ 551 3.9800 1 1 3 5 8

353 ................................ 2722 8.3420 3 4 6 9 16

354 ................................ 10004 5.9826 3 3 5 7 10

355 ................................ 5604 3.6253 2 3 3 4 5

356 ................................ 29892 2.8081 1 2 3 3 4

357 ................................ 6625 9.3250 4 5 7 11 17

358 ................................ 28910 4.4709 2 3 4 5 7

359 ................................ 28337 3.0904 2 2 3 4 4

360 ................................ 18232 3.2826 1 2 3 4 5

361 ................................ 680 3.6721 1 1 2 4 8

362 ................................ 1 1.0000 1 1 1 1 1

363 ................................ 3930 3.4725 1 2 2 3 7

364 ................................ 1869 3.4912 1 1 2 4 7

365 ................................ 2454 7.1520 1 2 4 9 16

366 ................................ 4507 6.9907 1 3 5 9 15

367 ................................ 543 2.9263 1 1 2 4 6
Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations 46111

TABLE 7B.—MEDICARE PROSPECTIVE PAYMENT SYSTEM; SELECTED PERCENTILE LENGTHS OF STAY—Continued

[FY96 MEDPAR Update 06/97 Grouper V15.0]

DRG Number

discharges

Arithmetic

mean LOS

10th

percentile

25th

percentile

50th

percentile

75th

percentile

90th

percentile

368 ................................ 2396 6.2371 2 3 5 8 12

369 ................................ 2424 3.4125 1 1 2 4 7

370 ................................ 1224 5.5074 2 3 4 5 9

371 ................................ 1107 3.5890 2 3 3 4 5

372 ................................ 909 3.1177 1 2 2 3 5

373 ................................ 4166 2.0290 1 1 2 2 3

374 ................................ 170 2.8824 1 2 2 3 4

375 ................................ 7 8.4286 1 2 5 9 15

376 ................................ 219 3.2055 1 1 2 4 7

377 ................................ 51 4.0196 1 1 2 4 9

378 ................................ 195 2.6256 1 2 2 3 4

379 ................................ 374 2.9278 1 1 2 3 5

380 ................................ 101 1.8317 1 1 1 2 4

381 ................................ 184 2.2935 1 1 1 2 5

382 ................................ 48 1.3333 1 1 1 1 2

383 ................................ 1616 3.8342 1 2 3 5 8

384 ................................ 142 2.8380 1 1 2 3 6

385 ................................ 3 6.6667 1 1 4 15 15

386 ................................ 1 49.0000 49 49 49 49 49

387 ................................ 1 62.0000 62 62 62 62 62

389 ................................ 16 6.2500 3 3 5 7 12

390 ................................ 7 5.1429 2 2 3 4 7

392 ................................ 2562 10.5863 4 5 8 13 21

393 ................................ 2 11.0000 7 7 15 15 15

394 ................................ 1814 7.5232 1 2 5 9 16

395 ................................ 68205 4.9806 1 2 4 6 10

396 ................................ 18 4.0000 1 1 2 7 7

397 ................................ 16988 5.7650 1 2 4 7 11

398 ................................ 18434 6.2525 2 3 5 8 12

399 ................................ 1304 4.0107 1 2 3 5 8

400 ................................ 7870 9.7126 2 3 7 12 21

401 ................................ 6799 11.6883 2 5 9 15 24

402 ................................ 1513 4.2412 1 1 3 6 9

403 ................................ 39143 8.5499 2 3 6 11 17

404 ................................ 3818 4.6239 1 2 4 6 9

406 ................................ 3473 10.1005 3 4 7 13 21

407 ................................ 695 4.4460 1 2 4 6 8

408 ................................ 2876 7.6203 1 2 5 9 18

409 ................................ 5607 5.9162 2 3 4 6 12

410 ................................ 74657 3.3553 1 2 3 4 5

411 ................................ 34 2.2941 1 1 1 3 6

412 ................................ 30 3.3667 1 1 2 5 7

413 ................................ 8827 8.0314 2 3 6 10 16

414 ................................ 735 4.5456 1 2 3 6 10

415 ................................ 44947 14.8941 4 7 11 18 29

416 ................................ 220123 7.6840 2 4 6 9 14

417 ................................ 42 4.2857 1 2 3 6 8

418 ................................ 20661 6.3189 2 3 5 8 12

419 ................................ 14969 5.2323 2 3 4 6 10

420 ................................ 2624 3.9737 1 2 3 5 7

421 ................................ 10783 4.2452 1 2 3 5 8

422 ................................ 90 3.7444 1 2 3 4 5

423 ................................ 10953 7.9358 2 3 6 9 16

424 ................................ 1883 16.7642 2 6 10 19 31

425 ................................ 15587 4.3867 1 2 3 5 8

426 ................................ 4759 5.2227 1 2 4 6 11

427 ................................ 1713 5.2668 1 2 4 7 11

428 ................................ 944 7.6684 1 3 5 9 16

429 ................................ 42603 7.8417 2 3 5 9 15

430 ................................ 56355 9.0159 2 4 7 11 18

431 ................................ 222 8.8694 2 3 5 9 17

432 ................................ 412 5.8422 1 2 3 7 12

433 ................................ 8270 3.2895 1 1 2 4 7

434 ................................ 22762 5.2873 2 3 4 6 10

435 ................................ 16653 4.5296 1 2 4 5 8

436 ................................ 3557 13.7641 4 8 13 20 26

437 ................................ 15724 9.9197 4 6 9 13 18

439 ................................ 1050 8.4581 1 3 6 10 18

440 ................................ 4863 9.5690 2 3 6 11 20

441 ................................ 617 3.4376 1 1 2 4 7
46112 Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations

TABLE 7B.—MEDICARE PROSPECTIVE PAYMENT SYSTEM; SELECTED PERCENTILE LENGTHS OF STAY—Continued

[FY96 MEDPAR Update 06/97 Grouper V15.0]

DRG Number

discharges

Arithmetic

mean LOS

10th

percentile

25th

percentile

50th

percentile

75th

percentile

90th

percentile

442 ................................ 15702 8.3069 1 3 6 10 17

443 ................................ 2996 3.3621 1 1 2 4 7

444 ................................ 3390 4.7661 1 2 4 6 9

445 ................................ 1251 3.6843 1 1 3 4 6

447 ................................ 4174 2.6416 1 1 2 3 5

448 ................................ 29 1.0000 1 1 1 1 1

449 ................................ 28988 4.0309 1 1 3 5 8

450 ................................ 6372 2.2461 1 1 1 2 4

451 ................................ 4 3.0000 1 1 1 2 8

452 ................................ 21599 5.1541 1 2 4 6 10

453 ................................ 3633 3.0790 1 1 2 4 6

454 ................................ 3997 5.1711 1 2 3 6 10

455 ................................ 916 2.7424 1 1 2 3 6

456 ................................ 215 7.2930 1 1 3 7 16

457 ................................ 113 4.8938 1 1 2 6 14

458 ................................ 1680 15.9685 3 6 12 21 33

459 ................................ 576 9.3247 2 4 7 12 19

460 ................................ 2332 6.3203 1 3 5 8 13

461 ................................ 3239 4.5952 1 1 2 5 11

462 ................................ 10116 12.9741 4 6 11 17 24

463 ................................ 13497 4.7743 1 2 4 6 9

464 ................................ 3208 3.4286 1 2 3 4 7

465 ................................ 214 3.7477 1 1 2 4 7

466 ................................ 1784 4.6962 1 1 2 5 10

467 ................................ 1617 4.2084 1 1 2 4 8

468 ................................ 60561 14.1162 3 6 11 18 28

471 ................................ 11672 6.7301 3 4 5 8 11

472 ................................ 203 24.2217 1 5 18 34 57

473 ................................ 8739 13.3313 2 4 7 19 34

475 ................................ 101087 11.4533 2 5 9 15 22

476 ................................ 6647 12.6556 3 7 11 16 23

477 ................................ 30187 8.6072 1 3 6 11 18

478 ................................ 126280 7.6802 1 3 6 10 16

479 ................................ 17952 4.1791 1 2 3 5 8

480 ................................ 417 25.2686 8 12 18 30 50

481 ................................ 257 30.2490 17 21 26 36 50

482 ................................ 7059 13.4577 5 7 10 15 24

483 ................................ 40197 43.1598 14 22 34 53 79

484 ................................ 407 15.4496 3 7 11 20 30

485 ................................ 3514 10.5552 4 5 8 12 20

486 ................................ 2518 13.3761 1 6 10 17 27

487 ................................ 4435 8.1150 2 3 6 10 16

488 ................................ 920 17.9750 4 7 13 22 37

489 ................................ 19832 9.7897 2 4 7 12 20

490 ................................ 5520 6.0612 1 2 4 7 12

491 ................................ 10763 3.9181 2 2 3 4 7

492 ................................ 2229 17.9740 4 5 14 28 37

493 ................................ 56802 5.6674 1 2 4 7 11

494 ................................ 25101 2.3728 1 1 2 3 5

495 ................................ 99 17.8081 7 11 15 23 31

496 ................................ 695 11.5885 4 6 9 13 22

497 ................................ 20050 6.8113 2 4 5 8 12

498 ................................ 10596 3.7558 1 2 3 5 7

499 ................................ 37778 5.2993 2 3 4 6 10

500 ................................ 34957 3.1295 1 2 3 4 6

501 ................................ 1652 11.2125 4 6 9 13 20

502 ................................ 424 7.0825 3 4 6 8 12

503 ................................ 6610 4.4082 1 2 4 5 8

11173095
Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations 46113

TABLE 8A.—STATEWIDE AVERAGE OPERATING COST-TO-CHARGE RATIOS

FOR URBAN AND RURAL HOSPITALS

(CASE WEIGHTED) AUGUST 1997

State Urban Rural

ALABAMA ......................... 0.400 0.449

ALASKA ............................ 0.516 0.780

ARIZONA .......................... 0.397 0.562

ARKANSAS ....................... 0.542 0.491

CALIFORNIA ..................... 0.382 0.489

COLORADO ...................... 0.477 0.554

CONNECTICUT ................ 0.551 0.555

DELAWARE ...................... 0.505 0.489

DISTRICT OF COLUMBIA 0.520 ............

FLORIDA ........................... 0.398 0.397

GEORGIA ......................... 0.508 0.510

HAWAII ............................. 0.458 0.531

IDAHO ............................... 0.557 0.618

ILLINOIS ........................... 0.474 0.587

INDIANA ............................ 0.559 0.596

IOWA ................................. 0.526 0.663

KANSAS ............................ 0.429 0.659

KENTUCKY ....................... 0.503 0.529

LOUISIANA ....................... 0.464 0.523

MAINE ............................... 0.619 0.578

MARYLAND ...................... 0.764 0.815

MASSACHUSETTS .......... 0.557 0.597

MICHIGAN ........................ 0.484 0.586

MINNESOTA ..................... 0.553 0.618

MISSISSIPPI ..................... 0.495 0.514

MISSOURI ........................ 0.445 0.535

MONTANA ........................ 0.485 0.599

NEBRASKA ....................... 0.495 0.660

NEVADA ........................... 0.329 0.522

NEW HAMPSHIRE ........... 0.574 0.597

NEW JERSEY ................... 0.455 ............

NEW MEXICO .................. 0.461 0.551

NEW YORK ...................... 0.561 0.647

NORTH CAROLINA .......... 0.533 0.478

NORTH DAKOTA ............. 0.619 0.669

OHIO ................................. 0.545 0.589

OKLAHOMA ...................... 0.475 0.549

OREGON .......................... 0.577 0.638

TABLE 8A.—STATEWIDE AVERAGE OPERATING COST-TO-CHARGE RATIOS

FOR URBAN AND RURAL HOSPITALS

(CASE WEIGHTED) AUGUST 1997—

Continued

State Urban Rural

PENNSYLVANIA ............... 0.407 0.540

PUERTO RICO ................. 0.478 0.522

RHODE ISLAND ............... 0.577 ............

SOUTH CAROLINA .......... 0.474 0.496

SOUTH DAKOTA .............. 0.542 0.639

TENNESSEE .................... 0.508 0.551

TEXAS .............................. 0.443 0.546

UTAH ................................ 0.598 0.641

VERMONT ........................ 0.610 0.564

VIRGINIA .......................... 0.493 0.509

WASHINGTON ................. 0.663 0.666

WEST VIRGINIA ............... 0.599 0.544

WISCONSIN ..................... 0.595 0.653

WYOMING ........................ 0.514 0.751

TABLE 8B.—STATEWIDE AVERAGE

CAPITAL COST-TO-CHARGE RATIOS

(CASE WEIGHTED) AUGUST 1997

State Ratio

ALABAMA ......................................... 0.054

ALASKA ............................................ 0.073

ARIZONA .......................................... 0.047

ARKANSAS ...................................... 0.055

CALIFORNIA .................................... 0.039

COLORADO ..................................... 0.053

CONNECTICUT ................................ 0.039

DELAWARE ...................................... 0.056

DISTRICT OF COLUMBIA ............... 0.040

FLORIDA .......................................... 0.047

GEORGIA ......................................... 0.048

HAWAII ............................................. 0.046

IDAHO ............................................... 0.054

ILLINOIS ........................................... 0.044

INDIANA ........................................... 0.059

TABLE 8B.—STATEWIDE AVERAGE

CAPITAL COST-TO-CHARGE RATIOS

(CASE WEIGHTED) AUGUST 1997—

Continued

State Ratio

IOWA ................................................ 0.055

KANSAS ........................................... 0.054

KENTUCKY ...................................... 0.054

LOUISIANA ....................................... 0.067

MAINE ............................................... 0.040

MARYLAND ...................................... 0.013

MASSACHUSETTS .......................... 0.064

MICHIGAN ........................................ 0.048

MINNESOTA ..................................... 0.058

MISSISSIPPI ..................................... 0.056

MISSOURI ........................................ 0.051

MONTANA ........................................ 0.057

NEBRASKA ...................................... 0.057

NEVADA ........................................... 0.034

NEW HAMPSHIRE ........................... 0.067

NEW JERSEY .................................. 0.043

NEW MEXICO .................................. 0.049

NEW YORK ...................................... 0.053

NORTH CAROLINA .......................... 0.049

NORTH DAKOTA ............................. 0.074

OHIO ................................................. 0.056

OKLAHOMA ...................................... 0.055

OREGON .......................................... 0.054

PENNSYLVANIA .............................. 0.042

PUERTO RICO ................................. 0.090

RHODE ISLAND ............................... 0.038

SOUTH CAROLINA .......................... 0.055

SOUTH DAKOTA ............................. 0.062

TENNESSEE .................................... 0.058

TEXAS .............................................. 0.053

UTAH ................................................ 0.058

VERMONT ........................................ 0.053

VIRGINIA .......................................... 0.058

WASHINGTON ................................. 0.067

WEST VIRGINIA ............................... 0.055

WISCONSIN ..................................... 0.048

WYOMING ........................................ 0.065

TABLE 10.—PERCENTAGE DIFFERENCE IN WAGE INDEXES FOR AREAS THAT QUALIFY FOR A WAGE INDEX EXCEPTION FOR

EXCLUDED HOSPITALS AND UNITS

Area 1982–1994

difference

1984–1994

difference

1988–1984

difference

1990–1994

difference

1991–1994

difference

1992–1994

difference

1993–1994

difference

Connecticut ............................................... 21.5862 24.0000 .................... .................... .................... .................... ....................

Delaware ................................................... .................... 8.6774 .................... .................... .................... .................... ....................

Hawaii ........................................................ .................... 15.7127 .................... .................... .................... .................... ....................

Maryland .................................................... .................... 8.1722 .................... .................... .................... .................... ....................

Massachusetts .......................................... 23.9560 27.9921 11.2140 .................... .................... .................... ....................

New Hampshire ......................................... .................... 9.5243 .................... .................... .................... .................... ....................

Oregon ...................................................... .................... .................... .................... 8.6010 8.1066 .................... ....................

South Carolina .......................................... .................... 10.0774 .................... .................... .................... .................... ....................

Vermont ..................................................... .................... 10.6667 .................... .................... .................... .................... ....................

Washington ............................................... .................... .................... .................... 9.9002 .................... .................... ....................

Amarillo, TX ............................................... .................... .................... .................... 8.6330 9.8229 .................... ....................

Anderson, SC ............................................ .................... .................... 15.1961 24.3721 .................... 8.9005 ....................

Arecibo, PR ............................................... .................... .................... .................... 13.7540 11.0585 .................... ....................

Athens, GA ................................................ 10.8688 16.5565 9.5058 9.4259 .................... .................... ....................

Atlantic City, NJ ......................................... .................... 13.2602 .................... .................... .................... .................... ....................

Augusta, GA–SC ....................................... .................... .................... .................... .................... 8.0453 .................... ....................

Benton Harbor, MI ..................................... .................... .................... .................... 8.8777 .................... .................... ....................

Bergen-Passaic, NJ .................................. 14.0017 15.9481 17.9622 .................... .................... .................... ....................

Billings, MT ................................................ .................... .................... .................... 8.6879 12.2161 12.3837 ....................

Biloxi-Gulfport, MS .................................... .................... .................... .................... 8.0594 .................... .................... ....................

Bloomington, IN ......................................... .................... .................... .................... .................... .................... 8.2928 ....................

Boston-Lowell-Brockton-Lawrence-Salem,

MA ......................................................... .................... 8.1568 .................... .................... .................... .................... ....................
46114 Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations

TABLE 10.—PERCENTAGE DIFFERENCE IN WAGE INDEXES FOR AREAS THAT QUALIFY FOR A WAGE INDEX EXCEPTION FOR

EXCLUDED HOSPITALS AND UNITS—Continued

Area 1982–1994

difference

1984–1994

difference

1988–1984

difference

1990–1994

difference

1991–1994

difference

1992–1994

difference

1993–1994

difference

Bremerton, WA .......................................... 12.9725 14.8961 15.2452 15.3177 13.7318 .................... ....................

Bridgeport-Stamford-Norwalk-Danbury,

CT .......................................................... 10.3293 14.6913 .................... .................... .................... .................... ....................

Burlington, NC ........................................... 11.6113 14.9594 9.7961 .................... .................... .................... ....................

Burlington, VT ........................................... .................... 9.3174 9.6092 .................... .................... 10.8280 ....................

Caguas, PR ............................................... .................... 12.2326 .................... .................... .................... .................... ....................

Charlotte-Gastonia-Rock Hill, NC–SC ...... 9.2601 16.3979 .................... .................... .................... .................... ....................

Clarksville-Hopkinsville, TN–KY ................ .................... 8.0204 .................... 14.9297 .................... .................... ....................

Columbia, SC ............................................ .................... 8.8584 .................... .................... .................... .................... ....................

Columbus, GA–AL .................................... .................... 12.8079 10.6690 9.7894 .................... .................... ....................

Cumberland, MD–WVA ............................. .................... .................... .................... 8.7659 9.2778 .................... ....................

Danville, VA ............................................... .................... .................... 8.4254 .................... .................... .................... ....................

Decatur, AL ............................................... .................... 12.0335 10.5832 .................... .................... .................... ....................

El Paso, TX ............................................... 8.1286 13.8951 16.0628 .................... 17.4634 9.2489 ....................

Eugene-Springfield, OR ............................ .................... 12.1188 12.4054 20.4953 8.0302 .................... ....................

Florence, SC ............................................. 14.2426 13.0711 .................... .................... .................... .................... ....................

Gadsden, AL ............................................. .................... .................... .................... 13.8007 9.0695 .................... ....................

Gainesville, FL .......................................... .................... 9.7617 8.7895 .................... 8.5675 .................... ....................

Galveston-Texas City, TX ......................... .................... .................... 11.9186 .................... .................... .................... ....................

Greeley, CO .............................................. .................... .................... .................... 15.7515 8.6166 10.3980 ....................

Greensboro-Winston-Salem-High Point,

NC .......................................................... .................... 9.9322 .................... .................... .................... .................... ....................

Hagerstown, MD ....................................... .................... 11.0716 .................... 9.5260 8.2039 .................... ....................

Hartford-Middletown-NewBritain, CT ........ 10.4740 14.2519 .................... .................... .................... .................... ....................

Houma-Thibodaux, LA .............................. .................... .................... 9.3263 .................... .................... .................... ....................

Jackson, TN .............................................. 8.5190 12.7249 .................... .................... .................... .................... ....................

Jersey City, NJ .......................................... .................... .................... 8.3144 .................... .................... .................... ....................

Killeen-Temple, TX .................................... 16.7787 .................... .................... .................... .................... .................... ....................

Lafayette, IN .............................................. .................... .................... .................... .................... 8.7871 10.0572 ....................

Laredo, TX ................................................ .................... .................... .................... 11.5765 .................... 8.5185 ....................

Las Cruse, NM .......................................... .................... .................... 9.2218 .................... .................... .................... ....................

Lawton, OK ............................................... .................... .................... .................... .................... .................... .................... 8.1162

Lima, OH ................................................... .................... .................... 13.8166 8.6982 .................... .................... ....................

Macon-Warner Robins, GA ....................... .................... 18.2494 .................... .................... .................... .................... ....................

Manchester-Nashua, NH ........................... 11.5134 12.8915 .................... .................... .................... .................... ....................

McAllen-Edinburg-Mission, TX .................. .................... 9.0116 8.4046 .................... .................... .................... ....................

Medford, OR .............................................. .................... .................... .................... 11.0706 .................... .................... ....................

Merced, CA ............................................... .................... 8.8820 .................... 9.1317 11.0694 .................... ....................

Middlesex-Somerset-Hunterdon, NJ ......... .................... 11.3808 .................... .................... .................... .................... ....................

Mobile, AL ................................................. .................... .................... .................... 8.2725 9.5491 8.3835 ....................

Monmouth-Ocean, NJ ............................... 11.0502 16.4802 10.3441 .................... .................... .................... ....................

Monroe, LA ................................................ .................... .................... .................... .................... 9.9294 .................... ....................

Muncie, IN ................................................. .................... .................... 13.5975 .................... .................... .................... ....................

Muskegon, MI ............................................ 10.1698 9.3800 13.1266 11.0394 10.3157 .................... ....................

Nassau-Suffolk, NY ................................... .................... 14.0415 .................... .................... .................... .................... ....................

New Bedford-Fall River-Attleboro, MA ...... 15.8880 18.8100 12.4963 .................... .................... .................... ....................

New Haven-West Haven-Waterbury, CT .. 10.3424 14.6360 .................... .................... .................... .................... ....................

New London-Norwich, CT ......................... 9.0604 12.5972 .................... .................... .................... .................... ....................

Newark, NJ ................................................ .................... 10.9661 .................... .................... .................... .................... ....................

Ocala, FL ................................................... .................... 10.9174 .................... .................... .................... .................... ....................

Orange County, NY ................................... 22.3089 26.7753 16.7892 10.2286 10.6828 .................... ....................

Panama City, FL ....................................... .................... .................... .................... .................... 10.5996 .................... ....................

Parkersburg-Marietta, WV–OH ................. .................... .................... .................... 8.3806 .................... 8.4505 ....................

Portsmouth-Dover-Rochester, NH ............ 10.1946 9.0222 .................... .................... .................... .................... ....................

Poughkeepsie, NY .................................... .................... 9.2928 .................... .................... .................... .................... ....................

Providence-Pawtucket-Woonsocket, RI .... .................... 13.4977 .................... .................... .................... .................... ....................

Provo-Orem, UT ........................................ .................... 8.6038 .................... .................... .................... .................... ....................

Redding, CA .............................................. .................... 19.0789 11.6583 .................... .................... .................... ....................

Salinas-Seaside-Monterey, CA ................. 16.3647 15.3473 11.1937 .................... .................... .................... ....................

San Angelo, TX ......................................... .................... .................... .................... .................... 9.0858 .................... ....................

Santa Cruz, CA ......................................... 15.0235 15.1075 10.8706 11.2183 .................... .................... ....................

Santa Fe, NM ............................................ .................... 8.8954 12.9551 .................... .................... .................... ....................

Tacoma, WA ............................................. .................... .................... .................... 8.4039 .................... .................... ....................

Texarkana, TX-Texarkana, AR ................. .................... .................... 9.6848 8.7486 9.5184 .................... ....................

Vallejo-Fairfield-Napa, CA ......................... .................... 12.0671 .................... 10.2260 .................... .................... ....................

Wausau, WI ............................................... .................... 9.6382 8.0763 .................... .................... .................... ....................

West Palm Beach-Boca Raton-Delray

Beach, FL .............................................. .................... 9.5017 .................... .................... .................... .................... ....................

Wilmington, DE–NJ–MD ........................... 8.3587 10.7306 .................... .................... .................... .................... ....................

Wilmington, NC ......................................... .................... 15.7476 8.5665 .................... .................... .................... ....................
Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations 46115

TABLE 10.—PERCENTAGE DIFFERENCE IN WAGE INDEXES FOR AREAS THAT QUALIFY FOR A WAGE INDEX EXCEPTION FOR

EXCLUDED HOSPITALS AND UNITS—Continued

Area 1982–1994

difference

1984–1994

difference

1988–1984

difference

1990–1994

difference

1991–1994

difference

1992–1994

difference

1993–1994

difference

Worcester-Fitchburg-Leomister, MA ......... .................... 13.3694 .................... .................... .................... .................... ....................

Yuma, AZ .................................................. .................... .................... 9.4344 .................... 12.1844 .................... ....................

Appendix A—Regulatory Impact

Analysis

I. Introduction

Section 804(2) of Title 5, United

States Code (as added by section 251 of

Public Law 104–121), specifies that a

‘‘major rule’’ is any rule that the Office

of Management and Budget finds is

likely to result in—

• An annual effect on the economy of

$100 million or more;

• A major increase in costs or prices

for consumers, individual industries,

Federal, State, or local government

agencies, or geographic regions; or

• Significant adverse effects on

competition, employment, investment,

productivity, innovation, or on the

ability of United States-based

enterprises to compete with foreignbased enterprises in domestic and

export markets.

We estimate that the impact of this

final rule with comment period will be

to decrease payments to hospitals by

approximately $6 billion in FY 1998,

compared to the payments that would

have been made in FY 1998 if Public

Law 105–33 had not been enacted.

Therefore, this rule is a major rule as

defined in Title 5, United States Code,

section 804(2).

We have examined the impacts of this

final rule with comment period as

required by Executive Order 12866 and

the Regulatory Flexibility Act (RFA)

(Pub. L. 96–354). Executive Order 12866

directs agencies to assess all costs and

benefits of available regulatory

alternatives and, when regulation is

necessary, to select regulatory

approaches that maximize net benefits

(including potential economic,

environmental, public health and safety

effects; distributive impacts; and

equity). The RFA requires agencies to

analyze options for regulatory relief for

small businesses. For purposes of the

RFA, most hospitals, and most other

providers, physicians, and health care

suppliers are small entities, either by

nonprofit status or by having revenues

of $5 million or less annually.

Also, section 1102(b) of the Social

Security Act requires us to prepare a

regulatory impact analysis for any final

rule with comment period that may

have a significant impact on the

operations of a substantial number of

small rural hospitals. Such an analysis

must conform to the provisions of

section 603 of the RFA. With the

exception of hospitals located in certain

New England counties, for purposes of

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

small rural hospital as a hospital with

fewer than 100 beds that is located

outside of a Metropolitan Statistical

Area (MSA) or New England County

Metropolitan Area (NECMA). Section

601(g) of the Social Security

Amendments of 1983 (Pub. L. 98–21)

designated hospitals in certain New

England counties as belonging to the

adjacent NECMA. Thus, for purposes of

the prospective payment system, we

classify these hospitals as urban

hospitals.

It is clear that the changes being made

in this document will affect both a

substantial number of small rural

hospitals as well as other classes of

hospitals, and the effects on some may

be significant. Therefore, the discussion

below, in combination with the rest of

this final rule with comment period,

constitutes a combined regulatory

impact analysis and regulatory

flexibility analysis.

In accordance with the provisions of

Executive Order 12866, this final rule

with comment period was reviewed by

the Office of Management and Budget.

II. Changes in the Final Rule With

Comment Period

After we published the proposed rule,

Public Law 105–33 was enacted. (A

summary of the provisions related to the

prospective payment system for

hospitals appears under section I.D. of

this preamble.) Several provisions of

Public Law 105–33 make significant

changes in inpatient hospital payments

for the operating and capital prospective

payment systems during FY 1998. The

provisions that have significant

payment impacts for FY 1998 include

the following:

• The update factors for the inpatient

operating standardized amounts and the

hospital-specific rate for FY 1998 are 0

percent. Hospitals that do not receive

disproportionate share (DSH) or indirect

medial education (IME) payments and

are not designated as a Medicaredependent, small rural hospital (MDH)

(referred to hereafter as ‘‘temporary

relief’’ hospitals) will receive a 0.5

percent update to their applicable

standardized amounts if—

• The hospital is in a State in which

the aggregate operating prospective

payments to these types of hospitals are

less than the aggregate allowable

operating costs for inpatient services for

FY 1995 cost reporting periods (eligible

States are identified in section V.D of

the preamble), and

• The hospital itself has a negative

operating prospective payment margin

in the payment year.

• The unadjusted standard Federal

capital rate and hospital-specific capital

rate are reduced by 17.78 percent for FY

1998.

• The additional DSH payments made

to eligible hospitals under the operating

prospective payment system are

reduced by 1 percent.

• The IME formula is revised to

reduce the IME adjustment factor from

approximately a 7.7 percent increase for

every 10 percent increase in a hospital’s

resident-to-bed ratio to a 7.0 percent

increase.

• IME and DSH payments will be

made only on the base DRG payment

rates, not on the sum of base DRG

payments and outlier payments. Also, in

determining outlier payments, the

estimated cost of a case will no longer

be adjusted for IME and DSH.

• The national share of the Puerto

Rico payment rate is increased from 25

to 50 percent. Thus, these hospitals will

be paid based on 50 percent of the

national standardized amount (a

discharge-weighted average of the large

urban and other urban national

standardized amounts) and 50 percent

of the Puerto Rico standardized amount.

• The wage index for an urban

hospital may not be lower than the

Statewide area rural wage index.

• The special treatment of MDHs is

reinstated. If the hospital-specific rate

for an eligible MDH is higher than the

Federal rate, the hospital receives 50

percent of the difference between the

Federal rate and the hospital-specific

rate.

• Any hospital classified as a rural

referral center (RRC) for FY 1991 must

continue to be classified as an RRC for

FY 1998 and subsequent fiscal years.
46116 Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations

• The update factor for prospective

payment system excluded hospitals for

FY 1998 is 0 percent.

• The target amounts for psychiatric

and rehabilitation hospitals and units,

and long-term care hospitals are capped

at the 75th percentile of target amounts

for within the same class.

• The seven State EACH/RPCH

program is being replaced by the Critical

Access Hospital (CAH) program, a

national program that allows States to

designate specified rural hospitals as

critical access hospitals. Payment to

these hospitals is on the basis of

reasonable costs.

III. Limitations of Our Analysis

As has been the case in previously

published regulatory impact analyses,

the following quantitative analysis

presents the projected effects of our

policy changes, as well as statutory

changes effective for FY 1998, on

various hospital groups. We estimate the

effects of individual policy changes by

estimating payments per case while

holding all other payment policies

constant. We use the best data available,

but we do not attempt to predict

behavioral responses to our policy

changes, and we do not make

adjustments for future changes in such

variables as admissions, lengths of stay,

or case mix.

We received no comments on the

methodology used for the impact

analysis in the proposed rule.

IV. Hospitals Included in and Excluded

From the Prospective Payment System

A. Included and Excluded Hospitals

The prospective payment systems for

hospital inpatient operating and capitalrelated costs encompass nearly all

general, short-term, acute care hospitals

that participate in the Medicare

program. There were 46 Indian Health

Service hospitals in our database, which

we excluded from the analysis due to

the special characteristics of the

prospective payment method for these

hospitals. Among other short-term,

acute care hospitals, only the 50 such

hospitals in Maryland remain excluded

from the prospective payment system

under the waiver at section 1814(b)(3) of

the Act. Thus, as of August 1997, we

have included 5,088 hospitals in our

analysis. (This is 41 fewer hospitals

than were included in the impact

analysis in the FY 1997 final rule (61 FR

46305).) This represents about 82

percent of all Medicare-participating

hospitals. The majority of this impact

analysis focuses on this set of hospitals.

The remaining 18 percent are

specialty hospitals that are excluded

from the prospective payment system

and continue to be paid on the basis of

their reasonable costs (subject to a rateof-increase ceiling on their inpatient

operating costs per discharge). These

hospitals include psychiatric,

rehabilitation, long-term care,

children’s, and cancer hospitals.

B. Critical Access Hospitals (CAHs)

(established by Pub. L. 105–33)

As explained earlier in this preamble,

section 4201 of Public Law 105–33

replaced the EACH program with a CAH

program. The CAH program is not

limited to seven States, but is available

to any State that both submits the

necessary assurances and complies with

the other statutory requirements for

designation of hospitals as CAHs.

Facilities that participated in Medicare

as RPCHs before the date of enactment

of Public Law 105–33 (August 5, 1997),

and that are otherwise eligible to be

designated by the States as CAHs, are

deemed to be CAHs. There are currently

approximately 38 facilities participating

as RPCHs. In addition, the 13 facilities

currently operating under the Medical

Assistance Facility (MAF)

demonstration in Montana are deemed

to have been certified by HCFA as

CAHs, if otherwise eligible for

designation by the State as CAHs.

Because of the small number of

facilities now participating as RPCHs or

MAFs, we do not expect the interim

final rule to have a significant impact on

a substantial number of small rural

hospitals. Moreover, in preparing the

regulations applicable to CAHs, we have

included only those changes that are

required to implement the new

legislation. Nonetheless, we are

informing the public of our projections

of the likely effects of the rules, for

those hospitals and beneficiaries who

may be affected.

For the currently participating

facilities, the primary effect will be

greater flexibility, since these facilities

will be able to maintain up to 15

inpatient beds, rather than 6, and will

be able to keep patients for as long as

96 hours, rather than an average of 72

hours. Patients in these facilities should

benefit from this, since there should be

fewer cases requiring patient transfer to

other facilities due to lack of beds or

need for longer periods of care.

However, with an expected increase in

utilization due to an increase in

numbers and lengths of stay, costs to the

Medicare program for care in these

facilities may be expected to rise. Some

or all of this increase may be offset by

savings from cases in which the changes

make transfer to another hospital

unnecessary. Changes in the swing-bed

provisions will also increase facility

flexibility and patient access to care.

These new provisions are less complex

than those imposed by prior law, and

should simplify program

administration.

The changes in payment methodology

may also increase Medicare spending

for care in these facilities, since

payment will now be based on

reasonable costs. Fee schedules and

blended rates for outpatient care will

not apply. However, the elimination of

the EACH designation may avoid many

unnecessary costs and offset any added

spending for CAH care.

While the removal of the seven State

limitation will undoubtedly lead to

greater participation in the program, we

are not able to estimate reliably how

many additional States will establish

limited-service hospital programs, or

how many hospitals in those States will

choose to participate in them. To the

extent that there is increased

participation, beneficiary convenience

and access to care in remote rural areas

would increase. Medicare spending,

however, would also increase, since

additional hospitals would be paid on a

basis other than the prospective

payment system. As noted above, some

or all of these increases may be offset by

prompt access to treatment in the local

community, thus avoiding the need for

care in full-service hospitals.

V. Impact on Excluded Hospitals and

Units

As of August 1997, there were 1,102

specialty hospitals excluded from the

prospective payment system and instead

paid on a reasonable cost basis subject

to the rate-of-increase ceiling under

§ 413.40. This group included 631

psychiatric hospitals, 192 rehabilitation

hospitals, 192 long-term care hospitals,

70 children’s hospitals and 17 Christian

Science sanitoria. In addition, there

were 1,472 psychiatric units and 880

rehabilitation units in hospitals

otherwise subject to the prospective

payment system. These excluded units

are also paid in accordance with

§ 413.40.

The market basket percentage increase

for excluded hospitals and units for FY

1998 is 2.7 percent. However, as a result

of section 4411 of Public Law 105–33

the update factor for FY 1998 is 0

percent.

The impact on excluded hospitals and

units of the update in the rate-ofincrease limit depends on the

cumulative cost increases experienced

by each excluded hospital or unit since

its applicable base period. For excluded

hospitals and units that have

maintained their cost increases at a level
Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations 46117

below the percentage increases in the

rate-of-increase limits since their base

period, the major effect will be on the

level of incentive payments these

hospitals and units receive. Conversely,

for excluded hospitals and units with

per-case cost increases above the

cumulative update in their rate-ofincrease limits, the major effect will be

the amount of excess costs that would

not be reimbursed.

In this context, we note that, under

§ 413.40(d)(3) as revised, an excluded

hospital or unit whose costs exceed 110

percent of the ceiling receives its ceiling

plus 50 percent of the difference

between its costs and 110 percent of the

ceiling, not to exceed 110 percent of the

ceiling. In addition, under the various

provisions set forth in § 413.40, certain

excluded hospitals and units can obtain

payment adjustments for justifiable

increases in operating costs that exceed

the limit. At the same time, however, by

generally limiting payment increases,

we continue to provide an incentive for

excluded hospitals and units to restrain

the growth in their spending for patient

services.

Section 4414 of Public Law 105–33

establishes a cap at the 75th percentile

on the target amounts for psychiatric,

rehabilitation, and long-term care

hospitals. Because the cap is based on

an estimate of the 75th percentile, we

estimate that 25 percent of the providers

will have target amounts in excess of the

cap. We have broken down the

estimated impact of that reduction as

follows:

PERCENT OF PROVIDERS ABOVE CAP

Type of hospital/

unit

Free-standing hospitals

Hospitalbased units

Rehabilitation ..... 23.2 76.8

Psychiatric ......... 42.5 57.5

Long-term care .. 25.0 (1)

1 Not applicable.

PERCENT OF TOTAL PROVIDERS

Type of hospital/

unit

Large

urban

Other

urban Rural

Rehabilitation ..... 48.8 38.7 12.5

Psychiatric ......... 49.2 32.2 18.6

Long-term care .. 74.3 17.8 7.9

PERCENT OF PROVIDERS ABOVE THE

CAP

Type of hospital/

unit

Large

urban

Other

urban Rural

Rehabilitation ..... 54.4 35.5 10.1

Psychiatric ......... 62.6 25.7 11.7

PERCENT OF PROVIDERS ABOVE THE

CAP—Continued

Type of hospital/

unit

Large

urban

Other

urban Rural

Long-term care .. 95.8 4.2 0.0

These tables show, of those hospitals

affected by the cap, the estimated

percentage of each type of provider

affected, and the proportion of these

hospitals that are located in urban or

rural areas. Although a higher

percentage of hospital-based units may

be affected by the cap than freestanding

hospitals, there are many more units

than hospitals. For instance, there are

twice as many hospital-based

psychiatric units than freestanding

hospitals and five times as many

hospital-based rehabilitation units as

freestanding hospitals. With regard to

the geographic impact of the provision

on long-term care hospitals, hospitals in

large urban areas are affected in greater

proportion than hospitals in other areas.

This is not unexpected because the

target amount cap is not adjusted for

differences in area wage levels. We also

observed that long-term care hospitals

certified before 1990 were less likely to

be affected by the 75th percentile

provision than older long-term care

hospitals. Psychiatric and rehabilitation

facilities appear slightly more likely to

be affected by the limit on the target

amount if they were certified after 1990

or are located in large urban areas. It is

important to note that while these

hospitals and units will have their target

amounts reduced to the 75th percentile,

the impact on a specific provider will

depend on the level of its operating

costs per discharge in relation to its

reduced target amount.

We are extending certain exclusion

criteria that currently apply only to

long-term care hospitals to all other

categories of excluded facilities. These

criteria define a minimum level of

independence and separate control that

a facility must have in order to be

excluded as a ‘‘hospital within a

hospital.’’ We expect that this provision

will result in a very small decrease in

aggregate payment levels (other things

being equal) by, for example, preventing

new hospital units from inappropriately

qualifying for the exemption from therate-of-increase ceiling that is available

only to new hospitals. To our

knowledge, there are fewer than 50

facilities that would be affected by this

proposal.

VI. Quantitative Impact Analysis of the

Policy Changes Under the Prospective

Payment System for Operating Costs

A. Basis and Methodology of Estimates

In this final rule with comment

period, we are announcing policy

changes and payment rate updates for

the prospective payment systems for

operating and capital-related costs. We

have prepared separate analyses of the

changes to each system. This section

deals with changes to the operating

prospective payment system.

The data used in developing the

quantitative analyses presented below

are taken from the FY 1996 MedPAR file

and the most current provider-specific

file that is used for payment purposes.

Although the analyses of the changes to

the operating prospective payment

system do not incorporate cost data, the

most recently available hospital cost

report data were used to create some of

the variables by which hospitals are

categorized. Our analysis has several

qualifications. First, we do not make

adjustments for behavioral changes that

hospitals may adopt in response to these

policy changes. Second, due to the

interdependent nature of the

prospective payment system, it is very

difficult to precisely quantify the impact

associated with each change. Third, we

draw upon various sources for the data

used to categorize hospitals in the

tables. In some cases, particularly the

number of beds, there is a fair degree of

variation in the data from different

sources. We have attempted to construct

these variables with the best available

source overall. For individual hospitals,

however, some miscategorizations are

possible.

Using cases in the FY 1996 MedPAR

file, we simulated payments under the

operating prospective payment system

given various combinations of payment

parameters. Any short-term, acute care

hospitals not paid under the general

prospective payment systems (Indian

Health Service hospitals and hospitals

in Maryland) are excluded from the

simulations. Payments under the capital

prospective payment system, or

payments for costs other than inpatient

operating costs, are not analyzed here.

Estimated payment impacts of the FY

1998 changes to the capital prospective

payment system are discussed below in

section VII of this Appendix.

The changes discussed separately

below are the following:

• The effects of the changes enacted

by Public Law 105–33. Although we are

not able to precisely simulate the effect

of every provision of this legislation that

may influence hospital payment, we

have simulated the payment effects of
46118 Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations

each of the significant provisions noted

above.

• The effects of the annual

reclassification of diagnoses and

procedures and the recalibration of the

DRG relative weights required by

section 1886(d)(4)(C) of the Act.

• The effects of changes in hospitals’

wage index values reflecting the FY

1998 wage index update (using FY 1994

data).

• The effects of implementing the

Puerto Rico-specific wage index to be

applied to the Puerto Rico standardized

amounts.

• The effects of completing the phaseout of payments for extraordinarily

lengthy cases (day outlier cases) with a

corresponding increase in payments for

extraordinarily costly cases (cost

outliers), in accordance with section

1886(d)(5)(A)(v) of the Act.

• The effects of geographic

reclassifications by the MGCRB that will

be effective in FY 1998.

• The total change in payments based

on FY 1998 policies relative to

payments based on FY 1997 policies.

To illustrate the impacts of the

changes resulting from Pub. L. 105–33,

our analysis begins with a FY 1998

baseline simulation model using the

policies as they existed before

enactment of Public Law 105–33

including a 2.7 percent (full market

basket) update to the standardized

amounts; the FY 1997 GROUPER

(version 14.0); the FY 1997 wage index;

national wage index values applied to

the Puerto Rico standardized amounts;

FY 1997 outlier policy (75 percent

phase-out of day outlier payments); and

no MGCRB reclassifications. Outlier

payments are set at 5.1 percent of total

DRG payments.

From this baseline, we move to a

simulation model reflecting the policies

enacted by Public Law 105–33. For

operating payments, these are: zero

update to the standardized amounts and

the hospital-specific rate, except for

temporary relief hospitals which receive

a 0.5 percent update; an increase in

payments to Puerto Rico by changing

the portion of their payments based on

the higher national standardized

amount from 25 percent to 50 percent;

reductions in IME and DSH payments;

the elimination of IME and DSH

payments attributable to outliers and the

corresponding change of no longer

standardizing charges for IME and DSH

when identifying outlier cases;

reinstating the MDH provision; and the

reinstatement of RRCs that lost their

status due to the triennial review or

MGCRB reclassification. One change

enacted by Public Law 105–33 that is

not included in this simulation is the

floor on the area wage index for urban

hospitals. This change is required to be

budget neutral so we did not introduce

it into the simulation model until we

calculated the wage index and DRG

budget neutrality factor. Therefore, in

our impact analysis, this change is

introduced when we bring the new (FY

1994) wage data into the model.

Each additional policy change is then

added incrementally to this baseline

model, finally arriving at an FY 1998

model incorporating all of the changes.

This allows us to isolate the effects of

each change.

Our final comparison illustrates the

percent change in payments per case

from FY 1997 to FY 1998. Three factors

have significant impacts here. First is

the changes enacted by Public Law 105–

33, with the exception of the impact of

the zero updates for FY 1998 (which

results in a zero change from FY 1997).

A second significant factor that has an

impact on hospitals’ payments per case

from FY 1997 to FY 1998 is a change in

MGCRB reclassification status from one

year to the next. That is, hospitals

reclassified for FY 1997 that are no

longer reclassified for FY 1998 may

have a negative payment impact going

from FY 1997 to FY 1998; conversely,

hospitals not reclassified for FY 1997

that are reclassified for FY 1998 may

have a positive impact. In some cases

these impacts can be quite substantial,

so if a relatively small number of

hospitals in a particular category lose

their reclassification status, the

percentage increase in payments for the

category may be below the national

mean.

A third significant factor is that we

currently estimate actual outlier

payments during FY 1997 will be 4.8

percent of actual total DRG payments.

When the FY 1997 final rule was

published, we projected FY 1997 outlier

payments would be 5.1 percent of total

DRG payments, and the standardized

amounts were reduced correspondingly.

The effects of the slightly lower than

expected outlier payments during FY

1997 (as discussed in the Addendum to

this proposed rule) are reflected in the

analyses below comparing our current

estimates of FY 1997 payments per case

to estimated FY 1998 payments per

case.

Table I demonstrates the results of our

analysis. The table categorizes hospitals

by various geographic and special

payment consideration groups to

illustrate the varying impacts on

different types of hospitals. The top row

of the table shows the overall estimated

impact on the 5,088 hospitals included

in the analysis.

The next four rows of Table I contain

hospitals categorized according to their

geographic location (all urban, which is

further divided into large urban and

other urban, or rural). There are 2,858

hospitals located in urban areas (MSAs

or NECMAs) included in our analysis.

Among these, there are 1,630 hospitals

located in large urban areas

(populations over 1 million), and 1,228

hospitals in other urban areas

(populations of 1 million or fewer). The

analysis includes 49 hospitals classified

as large urban hospitals that were

classified as other urban hospitals in the

proposed rule. These hospitals are in

four MSAs that have become large urban

areas since publication of the proposed

rule. There are 2,230 hospitals in rural

areas. The next two groupings are by

bed-size categories, shown separately

for urban and rural hospitals. The final

groupings by geographic location are by

census divisions, also shown separately

for urban and rural hospitals.

The second part of Table I shows

hospital groups based on hospitals’ FY

1998 payment classifications, including

any reclassifications under section

1886(d)(10) of the Act. For example, the

rows labeled urban, large urban, other

urban, and rural show the numbers of

hospitals being paid based on these

categorizations (after consideration of

geographic reclassifications) are 2,948,

1,776, 1,172, and 2,140, respectively.

The next three groupings examine the

impacts of the proposed changes on

hospitals grouped by whether or not

they have residency programs (teaching

hospitals that receive an IME

adjustment), receive DSH payments, or

some combination of these two

adjustments. There are 3,993

nonteaching hospitals in our analysis,

856 teaching hospitals with fewer than

100 residents, and 239 teaching

hospitals with 100 or more residents.

In the DSH categories, hospitals are

grouped according to their DSH

payment status, and whether they are

considered urban or rural after MGCRB

reclassifications. Hospitals in the rural

DSH categories, therefore, represent

hospitals that were not reclassified for

purposes of the standardized amount.

(They may, however, have been

reclassified for purposes of the wage

index.) The next category groups

hospitals considered urban after

geographic reclassification, in terms of

whether they receive the IME

adjustment, the DSH adjustment, both,

or neither.

The next row separately examines

hospitals that available data show may

qualify for the provision granting a 0.5

percent update to the standardized

amounts for FY 1998 (section 4401(b) of
Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations 46119

Pub. L. 105–33). To be eligible, a

hospital must not receive either IME or

DSH, nor may it be an MDH. It must

also experience a negative margin on its

operating prospective payments during

FY 1998. We estimated eligible

hospitals based on whether they had a

negative operating margin on their FY

1995 cost report. Finally, to qualify, a

hospital must be located in a State

where the aggregate FY 1995 operating

prospective payments were less than the

aggregate associated costs for all of the

non-IME, non-DSH, non-MDH hospitals

in the State. There are 360 hospitals in

this row.

The next five rows examine the

impacts of the proposed changes on

rural hospitals by special payment

groups (SCHs, RRCs, MDHs, and

EACHs), as well as rural hospitals not

receiving a special payment designation.

The RRCs (158), SCH/EACHs (642),

MDHs (368), and SCH/EACH and RRCs

(57) shown here were not reclassified

for purposes of the standardized

amount. Section 4202(b)(1) of Public

Law 105–33 allowed for reinstatement

of RRCs that lost their status since FY

1991. As a result, there are 63 more

hospitals in this row than were included

in the proposed rule. Similarly, there

are 16 more hospitals in the SCH/RRC

row than appeared in that row in the

proposed rule. There are three SCHs

that will be reclassified for the

standardized amount in FY 1998 that,

therefore, are not included in these

rows. There are seven EACHs included

in our analysis and three EACH/RRCs.

The next two groupings are based on

type of ownership and the hospital’s

Medicare utilization expressed as a

percent of total patient days. These data

are taken primarily from the FY 1995

Medicare cost report files, if available

(otherwise FY 1994 data are used). Data

needed to determine ownership status

or Medicare utilization percentages

were unavailable for 117 hospitals. For

the most part, these are either new

hospitals or hospitals filing manual cost

reports that are not yet entered into the

database.

The next series of groupings concern

the geographic reclassification status of

hospitals. The first three groupings

display hospitals that were reclassified

by the MGCRB for both FY 1997 and FY

1998, or for either of those 2 years, by

urban/rural status. The next rows

illustrate the overall number of FY 1998

reclassifications, as well as the numbers

of reclassified hospitals grouped by

urban and rural location. The final row

in Table I contains hospitals located in

rural counties but deemed to be urban

under section 1886(d)(8)(B) of the Act.

TABLE I.—IMPACT ANALYSIS OF CHANGES FOR FY 1998 OPERATING PROSPECTIVE PAYMENT SYSTEM

[Percent changes in payments per case]

Number

of

hosps.1

Balanced

Budget

Act 2

DRG recalibration 3New

wage

data 4

Combined

wage &

recal.5

Puerto

Rico specific wage

index 6

Day

outlier

phaseout 7

MGCRB

reclassification 8

All FY 98

changes 9

(0) (1) (2) (3) (4) (5) (6) (7) (8)

(BY GEOGRAPHIC LOCATION):

ALL HOSPITALS .................... 5,088 ¥3.9 0.1 0.1 0.0 0.0 0.0 0.0 0.9

URBAN HOSPITALS .............. 2,858 ¥3.9 0.1 0.1 0.0 0.0 0.0 ¥0.4 ¥1.0

LARGE URBAN ............. 1,630 ¥4.0 0.1 0.0 ¥0.1 0.0 ¥0.1 ¥0.4 ¥1.2

OTHER URBAN ............. 1,228 ¥3.8 0.2 0.2 0.2 0.0 0.1 ¥0.3 ¥0.7

RURAL HOSPITALS .............. 2,230 ¥3.4 ¥0.3 0.4 ¥0.1 0.0 0.1 2.2 ¥0.4

BED SIZE (URBAN):

0–99 BEDS ...................... 724 ¥3.6 ¥0.3 0.1 ¥0.4 0.0 0.1 ¥0.5 ¥0.9

100–199 BEDS ................ 954 ¥3.7 ¥0.1 0.1 ¥0.2 0.0 0.1 ¥0.4 ¥0.7

200–299 BEDS ................ 570 ¥3.8 0.1 0.1 ¥0.1 0.0 0.1 ¥0.3 ¥0.8

300–499 BEDS ................ 457 ¥4.0 0.2 0.2 0.2 0.0 0.0 ¥0.4 ¥1.0

500 OR MORE BEDS ..... 153 ¥4.3 0.4 0.0 0.2 0.0 ¥0.2 ¥0.3 ¥1.3

BED SIZE (RURAL):

0–49 BEDS ...................... 1,170 ¥3.0 ¥0.6 0.4 ¥0.4 0.0 0.1 0.1 ¥0.3

50–99 BEDS .................... 657 ¥3.1 ¥0.4 0.4 ¥0.2 0.0 0.1 1.1 ¥0.3

100–149 BEDS ................ 235 ¥3.4 ¥0.3 0.4 ¥0.1 0.0 0.1 3.2 ¥0.5

150–199 BEDS ................ 93 ¥3.7 ¥0.2 0.4 0.0 0.0 0.1 2.6 ¥0.4

200 OR MORE BEDS ..... 75 ¥3.6 0.0 0.3 0.1 0.0 0.2 4.2 ¥0.8

URBAN BY CENSUS DIVISION:

NEW ENGLAND .............. 159 ¥4.2 0.1 ¥0.3 ¥0.4 0.0 0.1 ¥0.3 ¥1.9

MIDDLE ATLANTIC ........ 431 ¥4.4 0.1 0.3 0.1 0.0 ¥0.7 ¥0.4 ¥2.0

SOUTH ATLANTIC ......... 420 ¥3.8 0.2 ¥0.2 ¥0.2 0.0 0.2 ¥0.3 ¥0.8

EAST NORTH CENTRAL 475 ¥4.0 0.1 0.3 0.2 0.0 0.2 ¥0.3 ¥0.7

EAST SOUTH CENTRAL 163 ¥3.8 0.2 1.0 1.0 0.0 0.2 ¥0.5 0.2

WEST NORTH

CENTRAL .................... 191 ¥4.0 0.2 0.2 0.2 0.0 0.2 ¥0.4 ¥0.6

WEST SOUTH CENTRAL 367 ¥3.8 0.2 0.2 0.1 0.0 0.2 ¥0.5 ¥0.5

MOUNTAIN ..................... 129 ¥3.7 0.3 ¥0.2 ¥0.1 0.0 0.2 ¥0.4 ¥0.6

PACIFIC .......................... 475 ¥3.6 0.1 ¥0.3 ¥0.4 0.0 0.2 ¥0.3 ¥0.9

PUERTO RICO ............... 48 3.1 ¥0.2 0.3 ¥0.1 3.7 ¥0.1 ¥0.4 12.2

RURAL BY CENSUS DIVISION:

NEW ENGLAND .............. 53 ¥3.9 ¥0.2 0.6 0.1 0.0 0.2 2.1 ¥0.6

MIDDLE ATLANTIC ........ 85 ¥3.3 ¥0.3 ¥0.4 ¥0.9 0.0 ¥0.1 1.1 ¥0.9

SOUTH ATLANTIC ......... 297 ¥3.6 ¥0.2 0.4 0.0 0.0 0.1 2.4 ¥1.0

EAST NORTH CENTRAL 302 ¥3.3 ¥0.2 0.5 0.0 0.0 0.2 1.4 ¥0.7

EAST SOUTH CENTRAL 275 ¥3.4 ¥0.3 0.6 0.1 0.0 0.2 2.5 0.0

WEST NORTH

CENTRAL .................... 512 ¥3.2 ¥0.4 0.2 ¥0.4 0.0 0.1 2.5 0.0
46120 Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations

TABLE I.—IMPACT ANALYSIS OF CHANGES FOR FY 1998 OPERATING PROSPECTIVE PAYMENT SYSTEM—Continued

[Percent changes in payments per case]

Number

of

hosps.1

Balanced

Budget

Act 2

DRG recalibration 3New

wage

data 4

Combined

wage &

recal.5

Puerto

Rico specific wage

index 6

Day

outlier

phaseout 7

MGCRB

reclassification 8

All FY 98

changes 9

(0) (1) (2) (3) (4) (5) (6) (7) (8)

WEST SOUTH CENTRAL 347 ¥3.2 ¥0.4 0.3 ¥0.3 0.0 0.1 3.3 ¥0.3

MOUNTAIN ..................... 213 ¥3.1 ¥0.2 0.3 ¥0.2 0.0 0.1 1.6 0.3

PACIFIC .......................... 141 ¥3.3 ¥0.2 1.1 0.6 0.0 0.1 2.1 ¥0.1

PUERTO RICO ............... 5 4.9 ¥0.6 2.4 1.5 4.4 0.1 1.5 15.3

BY PAYMENT CATEGORIES:

URBAN HOSPITALS .............. 2,948 ¥3.9 0.1 0.1 0.0 0.0 0.0 ¥0.3 ¥1.0

LARGE URBAN ............... 1,776 ¥4.0 0.1 0.0 ¥0.1 0.0 ¥0.1 ¥0.2 ¥1.1

OTHER URBAN .............. 1,172 ¥3.8 0.2 0.2 0.2 0.0 0.1 ¥0.4 ¥0.6

RURAL HOSPITALS .............. 2,140 ¥3.3 ¥0.3 0.4 ¥0.1 0.0 0.1 1.9 ¥0.5

TEACHING STATUS:

NON-TEACHING ............. 3,993 ¥3.6 ¥0.1 0.2 ¥0.1 0.0 0.1 0.3 ¥0.6

LESS THAN 100 RES ..... 856 ¥3.9 0.2 0.1 0.1 0.0 0.1 ¥0.3 ¥0.8

100+ RESIDENTS ........... 239 ¥4.4 0.3 0.0 0.2 0.0 ¥0.3 ¥0.2 ¥1.6

DISPROPORTIONATE

SHARE HOSPITALS

(DSH):

NON-DSH ........................ 3,185 ¥3.8 0.0 0.2 0.0 0.0 0.1 0.2 ¥0.8

URBAN DSH:

100 BEDS OR

MORE ................... 1,413 ¥3.9 0.2 0.1 0.0 0.0 ¥0.1 ¥0.3 ¥1.0

FEWER THAN 100

BEDS .................... 89 ¥3.7 ¥0.4 0.3 ¥0.4 0.0 0.2 ¥0.4 ¥0.8

RURAL DSH:

SOLE COMMUNITY

(SCH) .................... 155 ¥3.1 ¥0.5 0.3 ¥0.4 0.0 0.0 0.2 ¥0.4

REFERRAL CENTERS (RRC) ......... 50 ¥2.8 ¥0.1 0.5 0.2 0.0 0.1 3.4 0.6

OTHER RURAL DSH

HOSP.:

100 BEDS OR

MORE ................... 66 ¥3.6 ¥0.3 0.7 0.1 0.0 0.2 2.3 ¥1.4

FEWER THAN 100

BEDS .................... 130 ¥3.4 ¥0.6 0.7 ¥0.1 0.0 0.1 0.8 ¥0.2

URBAN TEACHING AND

DSH:

BOTH TEACHING AND

DSH ............................. 708 ¥4.1 0.2 0.0 0.1 0.0 ¥0.2 ¥0.4 ¥1.2

TEACHING AND NO

DSH ............................. 330 ¥4.2 0.3 0.3 0.3 0.0 0.1 ¥0.2 ¥1.0

NO TEACHING AND

DSH ............................. 794 ¥3.6 0.0 0.1 ¥0.1 0.0 0.1 ¥0.1 ¥0.5

NO TEACHING AND NO

DSH ............................. 1,116 ¥3.7 0.0 0.0 ¥0.2 0.0 0.2 ¥0.3 ¥0.8

SPECIAL UPDATE HOSPITALS (UNDER SEC.

4401(b) OF PUBLIC LAW

105–33) ............................... 360 ¥3.8 ¥0.1 0.6 0.2 0.1 0.2 0.2 ¥0.6

RURAL HOSPITAL TYPES:

NONSPECIAL STATUS

HOSPITALS ................. 915 ¥3.5 ¥0.4 0.5 ¥0.1 0.0 0.1 1.5 ¥0.8

RRC ................................. 158 ¥3.7 ¥0.1 0.5 0.2 0.0 0.2 4.3 ¥0.5

SCH/EACH ...................... 642 ¥3.0 ¥0.4 0.2 ¥0.5 0.0 0.0 0.6 ¥0.4

MDH ................................ 368 ¥2.0 ¥0.5 0.4 ¥0.3 0.0 0.1 0.5 0.8

SCH/EACH AND RRC .... 57 ¥3.2 ¥0.2 0.2 ¥0.2 0.0 0.0 0.8 ¥0.5

TYPE OF OWNERSHIP:

VOLUNTARY ................... 2,924 ¥3.9 0.1 0.1 0.0 0.0 0.0 ¥0.1 ¥1.0

PROPRIETARY ............... 701 ¥3.6 0.0 0.0 ¥0.2 0.1 0.2 0.3 ¥0.6

GOVERNMENT ............... 1,346 ¥3.7 0.0 0.4 0.2 0.0 0.1 0.2 ¥0.4

UNKNOWN ...................... 117 ¥4.0 0.0 ¥0.5 ¥0.7 0.2 ¥1.5 ¥0.5 ¥2.4

MEDICARE UTILIZATION AS

A PERCENT OF INPATIENT DAYS:

0–25 ................................. 266 ¥3.6 0.1 ¥0.3 ¥0.5 0.0 ¥0.1 ¥0.3 ¥1.2

25–50 ............................... 1,307 ¥4.0 0.2 0.0 0.0 0.0 0.0 ¥0.2 ¥1.0

50–65 ............................... 1,988 ¥3.8 0.1 0.3 0.1 0.0 0.1 0.2 ¥0.8

OVER 65 ......................... 1,410 ¥3.7 ¥0.1 0.2 ¥0.2 0.0 0.1 0.1 ¥0.9
Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations 46121

TABLE I.—IMPACT ANALYSIS OF CHANGES FOR FY 1998 OPERATING PROSPECTIVE PAYMENT SYSTEM—Continued

[Percent changes in payments per case]

Number

of

hosps.1

Balanced

Budget

Act 2

DRG recalibration 3New

wage

data 4

Combined

wage &

recal.5

Puerto

Rico specific wage

index 6

Day

outlier

phaseout 7

MGCRB

reclassification 8

All FY 98

changes 9

(0) (1) (2) (3) (4) (5) (6) (7) (8)

UNKNOWN ...................... 117 ¥4.0 0.0 ¥0.5 ¥0.7 0.2 ¥1.5 ¥0.5 ¥2.4

HOSPITALS RECLASSIFIED BY

THE MEDICARE GEOGRAPHIC

REVIEW BOARD:

RECLASSIFICATION STATUS DURING FY97 AND

FY98:

RECLASSIFIED DURING

BOTH FY97 AND FY98 333 ¥3.9 0.0 0.5 0.3 0.0 0.2 6.2 ¥0.9

URBAN ..................... 96 ¥4.2 0.1 0.5 0.4 0.0 0.1 3.6 ¥1.1

RURAL ..................... 237 ¥3.7 ¥0.1 0.4 0.1 0.0 0.2 9.0 ¥0.6

RECLASSIFIED DURING

FY98 ONLY ................. 89 ¥3.6 0.0 0.5 0.3 0.1 0.2 4.0 5.3

URBAN ..................... 13 ¥3.7 0.4 0.7 0.9 0.2 0.2 0.0 2.8

RURAL ..................... 76 ¥3.4 ¥0.3 0.3 ¥0.2 0.0 0.2 7.3 7.3

RECLASSIFIED DURING

FY97 ONLY ................. 211 ¥4.0 0.0 0.6 0.3 0.0 0.0 ¥0.9 ¥4.2

URBAN ..................... 94 ¥4.2 0.1 0.6 0.5 0.0 ¥0.1 ¥1.0 ¥4.0

RURAL ..................... 117 ¥3.6 ¥0.2 0.5 0.0 0.0 0.2 ¥0.2 ¥4.7

FY 98 RECLASSIFICATIONS:

ALL RECLASSIFIED

HOSP ........................... 423 ¥3.9 0.0 0.5 0.3 0.0 0.2 5.8 ¥0.1

STAND. AMOUNT

ONLY .................... 94 ¥4.1 0.0 0.4 0.2 0.0 0.1 1.3 ¥0.9

WAGE INDEX ONLY 282 ¥3.7 0.0 0.5 0.3 0.0 0.2 7.9 0.2

BOTH ....................... 47 ¥4.2 0.0 0.3 0.1 0.0 0.3 5.5 0.2

NONRECLASSIFIED 4,638 ¥3.9 0.1 0.1 0.0 0.0 0.0 ¥0.5 ¥1.0

ALL URBAN RECLASS .. 109 ¥4.1 0.1 0.5 0.4 0.0 0.1 3.2 ¥0.7

STAND. AMOUNT

ONLY .................... 45 ¥4.0 0.1 0.4 0.3 0.0 0.0 0.6 ¥0.9

WAGE INDEX ONLY 31 ¥4.2 0.3 0.8 0.8 0.0 0.2 6.0 ¥0.8

BOTH ....................... 33 ¥4.2 0.1 0.4 0.2 0.0 0.2 3.3 ¥0.1

NONRECLASSIFIED 2,749 ¥3.9 0.1 0.1 0.0 0.0 0.0 ¥0.5 ¥1.0

ALL RURAL RECLASS ... 314 ¥3.6 ¥0.1 0.4 0.1 0.0 0.2 8.7 0.6

STAND. AMOUNT

ONLY .................... 49 ¥4.2 ¥0.3 0.3 ¥0.2 0.0 0.3 4.3 ¥1.1

WAGE INDEX ONLY 251 ¥3.5 ¥0.1 0.4 0.1 0.0 0.2 8.6 0.6

BOTH ....................... 14 ¥4.4 ¥0.1 0.2 ¥0.1 0.0 0.4 18.0 2.2

NONRECLASSIFIED 1,889 ¥3.2 ¥0.3 0.4 ¥0.2 0.0 0.1 ¥0.4 ¥0.9

OTHER RECLASSIFIED

HOSPITALS (SECTION

1886(d)(8)(B)) ..................... 27 ¥3.6 ¥0.3 0.7 0.2 0.0 0.1 0.7 0.1

1Because data necessary to classify some hospitals by category were missing, the total number of hospitals in each category may not equal

the national total. Discharge data are from FY 1996, and hospital cost report data are from reporting periods beginning in FY 1994 and FY 1995. 2This column displays the impact of the changes enacted by Public Law 105–33. The most significant of those in terms of their impacts here

are the zero update, the reduction to the IME adjustment, and no longer paying an IME and DSH adjustment for outliers. 3This column displays the payment impact of the recalibration of the DRG weights, based on FY 1996 MedPAR data and the DRG classification changes, in accordance with section 1886(d)(4)(C) of the Act. 4This column shows the payment effects of updating the data used to calculate the wage index with data from the FY 1994 cost reports and

the Public Law 105–33 provision establishing a floor on the area wage index for urban hospitals. 5This column displays the combined impact of the reclassification and recalibration of the DRGs, the updated wage data used to calculate the

wage index, and the budget neutrality adjustment factor for these two changes, in accordance with sections 1886(d)(4)(C)(iii) and 1886(d)(3)(E)

of the Act. Thus, it represents the combined impacts shown in columns 2 and 3, and the FY 1998 budget neutrality factor of 0.997731. 6This column illustrates the payment impact of the Puerto Rico-specific wage index, applied to the Puerto Rico-specific standardized amounts.

7This column illustrates the payment impact of completing the phase-out of day outlier payments, and increasing cost outlier payments, in accordance with section 1886(d)(5) of the Act. 8Shown here are the combined effects of geographic reclassification by the Medicare Geographic Classification Review Board (MGCRB). The

effects shown here demonstrate the FY 1998 payment impact of going from no reclassifications to the reclassifications scheduled to be in effect

for FY 1998. Reclassification for prior years has no bearing on the payment impact shown here. 9This column shows changes in payments from FY 1997 to FY 1998. It incorporates all of the changes displayed in columns 4 through 7 (the

changes displayed in columns 2 and 3 are included in column 4). It also displays the impact of the changes shown in column 1, less the 2.7 percent negative impact of the zero update. Finally, it shows the impact of changes in hospitals’ reclassification status in FY 1998 compared to FY

1997, and the difference in outlier payments from FY 1997 to FY 1998. The sum of these columns may be different from the percentage

changes shown here due to rounding and interactive effects.
46122 Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations

B. Impact of Changes Enacted by Public

Law 105–33 (Column 1)

Public Law 105–33 contained several

provisions that significantly impact

hospitals’ payments under the operating

prospective payment system during FY

1998, relative to payments if Public Law

105–33 had not been enacted. Certainly

the largest single impact is the zero

update for the standardized amounts

and the hospital-specific rate. Prior to

this change, the law provided that

hospitals were to receive the full market

basket of 2.7 percent. As indicated

above, temporary relief hospitals do

receive an update of 0.5 percent.

Freezing the standardized amounts and

the hospital-specific rates at their FY

1997 levels (prior to any budget

neutrality calculations) is the largest

impact evident in column 1.

As discussed previously, to illustrate

the impacts of the changes resulting

from Public Law 105–33, we begin with

a FY 1998 baseline payment model

using a 2.7 percent update; the FY 1997

GROUPER; the FY 1997 wage index; no

MGCRB reclassifications; outlier

payments based on 25 percent day

outliers and factoring IME and DSH into

DRG payments plus outlier payments;

no MDHs; and Puerto Rico hospitals

receive 25 percent of the national Puerto

Rico amount and 75 percent of the

Puerto Rico amount. From this baseline

we moved to a payment simulation

model incorporating all but one of the

changes enacted by Public Law 105–33;

we did not include the floor on the wage

index for urban hospitals because that

change was required to be budget

neutral. Therefore, this change is

included in the new (FY 1994) wage

data column.

The overall impact on hospital

operating payments per case due to

Public Law 105–33 is a 3.9 percent

reduction in payments. As pointed out

above, 2.7 percent of this decline relates

to the freeze in the update. This

negative impact is evident across all

hospital categories, although it is offset

to a small degree among those hospitals

that receive the special 0.5 percent

update. However, this update provision

has an insignificant impact overall. In

fact, the 360 temporary relief hospitals

that qualify for this special update have

only a slightly smaller decrease in

payments (3.8 percent) than the national

average. This is largely due to the

change that eliminated the IME and

DSH adjustments attributable to outlier

payments. Although these hospitals by

definition do not receive IME or DSH

payments, they are negatively impacted

by the redistribution of outlier payments

that result from the change. Because we

no longer standardize the charges of

cases by hospitals’ IME and DSH factors,

the outlier thresholds are higher and

there is a substantial redistribution of

outlier payments toward hospitals that

also receive IME and DSH and away

from non-IME, non-DSH hospitals. The

negative impact of this change on the

latter group of hospitals is

approximately 1.8 percent.

The change in outlier policy also

affects overall payments. Because IME

and DSH are now based only on the

base DRG amount, total payments are

less than they would be before this

change. The net impact of this change

is to reduce the overall average payment

per case by approximately 0.6 percent.

The reduction in the IME adjustment

also reduces payments by

approximately 0.6 percent overall. The

combined impacts of these changes and

the other, less significant changes result

in an overall decrease in hospitals’

average payment per case due to Public

Law 105–33 of 3.9 percent.

The only hospital categories

demonstrating a net increase in

payments in column 1 are urban and

rural Puerto Rico hospitals (3.1 percent

and 4.9 percent, respectively). This is

due to the change in the formula for

calculating payments for Puerto Rico

hospitals from 25 percent of the national

amount and 75 percent of the Puerto

Rico amount, to a 50/50 blend of the

two amounts. Because the national

amount is more than twice the Puerto

Rico amount, the change in the blend

more than offsets the 2.7 percent

decrease in the amounts after Public

Law 105–33. The smaller increase

among urban Puerto Rico hospitals is

explained at least in part by the fact

that, because the national Puerto Rico

amount is the same for large urban and

other area hospitals while the large

urban Puerto Rico amount is greater

than the other area Puerto Rico amount,

large urban Puerto Rico hospitals gain

slightly less than other Puerto Rican

hospitals from the formula change.

The hospital category with the

smallest negative impact in this column

is MDHs. Their payments overall drop

by only 2.0 percent. Over 30 hospitals

in this category have payment increases

after being reinstated as an MDH,

despite the zero update and the fact that

they receive only 50 percent of the

difference between their hospitalspecific rate and the Federal rate.

The greatest negative impact in this

column is a 4.4 percent drop in

payments among teaching hospitals

with more than 100 residents and urban

hospitals in the Middle Atlantic census

division (due to the concentration of

teaching hospitals in this census

division). This effect is due to the

reduction in the IME adjustment,

although the decrease in the IME

adjustment factor is offset for these

hospitals to some extent by the outlier

changes which result in higher outlier

payments to teaching and

disproportionate share hospitals.

Without the change to remove the IME

and DSH adjustments from the outlier

calculation, payments to major teaching

hospitals would have fallen by

approximately 1.0 percent more.

Finally, the decline in payments

shown here among rural hospitals is

generally not as great as the decline

among urban hospitals. Overall, rural

hospitals’ payments decline by 3.4

percent, compared to 3.9 percent for

urban hospitals. This result is

attributable to those rural hospitals paid

on the basis of their hospital-specific

rate, particularly SCHs. Because

hospitals receiving their hospitalspecific rate do not receive outliers,

IME, or DSH, they are unaffected by the

policy changes related to these

additional payments. Therefore, their

net change in payments after Pub. L.

105–33 is generally limited to the 2.7

percent reduction in the update for FY

1998 (from full market basket

percentage increase to 0).

C. Impact of the Changes to the DRG

Classifications and Relative Weights

(Column 2)

In column 2 of Table I, we present the

combined effects of the DRG

reclassifications and recalibration, as

discussed in section II of the preamble

to this final rule with comment period.

Section 1886(d)(4)(C)(i) of the Act

requires us each year to make

appropriate classification changes and

to recalibrate the DRG weights in order

to reflect changes in treatment patterns,

technology, and any other factors that

may change the relative use of hospital

resources.

We compared aggregate payments

using the FY 1997 DRG relative weights

(GROUPER version 14) to aggregate

payments using the FY 1998 DRG

relative weights (GROUPER version 15).

Overall, payments increase by 0.1

percent due to the DRG changes,

although this is prior to applying the

budget neutrality factor for DRG and

wage index changes (see column 4).

Consistent with the minor changes we

are implementing for the FY 1998

GROUPER, the redistributional impacts

of DRG reclassifications and

recalibration across hospital groups are

small (a 0.1 percent increase for large

urban hospitals; a 0.2 percent increase

for other urban hospitals; and a 0.3

percent decrease among rural hospitals).
Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations 46123

Within hospital categories, the net

effects for urban hospitals are small

positive changes for larger hospitals

(200 or more beds), and slightly negative

changes for urban hospitals with fewer

than 200 beds. Among rural hospitals,

the smallest rural hospitals (fewer than

50 beds) experience a decrease of 0.6

percent. For other rural bed size

categories, slight negative impacts

prevail. Only the largest rural hospitals

(200 or more beds) avoid any negative

impact from the changes.

The breakdowns by urban census

division show that the increase among

urban hospitals is spread across all

census categories except Puerto Rico,

with the largest increase (0.3 percent)

for hospitals in the Mountain census

division. For rural hospitals, the largest

decrease is 0.4 percent for hospitals in

the West North Central and West South

Central census divisions and 0.6 percent

for the five rural hospitals in Puerto

Rico. Rural hospitals in all other census

regions experience decreases of 0.2 or

0.3 percent. This pattern of negative

impacts upon small and rural hospitals

is also apparent when examining the

effects of DRG changes on hospitals

according to special payment categories,

with the largest decreases (0.5 percent)

among MDHs, rural DSH SCHs, and

rural DSH hospitals with fewer than 100

beds (0.6 percent decrease).

Overall, we attribute the changes

associated with DRG recalibration to the

increasing gap between the relative

weights for medical, diagnostic, and less

complicated surgical DRGs and the

weights for the more complicated

surgical DRGs. Since the cases

associated with the former DRGs tend to

be treated more often in smaller

hospitals with fewer resources available,

lower relative weights associated with

those cases would disproportionately

affect these hospitals. In general, small

hospitals that serve a disproportionate

share of low-income patients fit this

definition. In contrast, larger hospitals

in both urban and rural areas, which

tend to treat the latter group of DRGs,

would experience small payment

increases. Teaching hospitals, which

also treat the more complicated cases,

experience similar effects. We note,

however, that both the positive and

negative impacts are relatively minor, in

almost all categories they are 0.5 percent

or less.

D. Impact of Updating the Wage Data

(Column 3)

Section 1886(d)(3)(E) of the Act

requires that, beginning October 1, 1993,

we annually update the wage data used

to calculate the wage index. In

accordance with this requirement, the

final wage index for FY 1998 is based

on data submitted for hospital cost

reporting periods beginning on or after

October 1, 1993 and before October 1,

1994. As with the previous column, the

impact of the new data on hospital

payments is isolated by holding the

other payment parameters constant in

the two simulations. That is, column 3

shows the percentage changes in

payments when going from a model

using the FY 1997 wage index based on

FY 1993 wage data before geographic

reclassifications to a model using the FY

1998 prereclassification wage index

based on FY 1994 wage data. Also

included in the model using the FY

1994 wage data are the effects of the

provision of Public Law 105–33 that

urban hospitals’ wage indexes may not

be below the wage index of the rural

areas in the State in which the urban

hospital is located.

The results indicate that the impact of

the new wage data is a 0.1 percent

increase overall in hospital payments

(prior to applying the budget neutrality

factor, see column 4). Rural and other

urban hospitals generally appear to

benefit from the update with payments

increasing 0.4 and 0.2 percent,

respectively. The increases for rural

hospitals are attributable to relatively

large increases in the wage index values

for the rural areas of particular States

(although none increased by more than

5 percent). The increases for other urban

hospitals, 0.2 percent compared to 0.1

percent in FY 1997 and in the FY 1998

proposed wage index, appear to be

attributable in large part to the

requirement that the wage index values

for urban hospitals be at least equal to

the rural wage index values for the

States in which they are located.

Hospitals in 32 urban areas experienced

increases in their wage index values as

a result of that provision. Hospitals in

nine of the urban areas experienced

increases of more than 5 percent as a

result of the provision for a Statewide

rural wage index floor for urban

hospitals.

Some of the largest changes in

payments are found among both urban

and rural hospitals grouped by census

division, although in almost all cases

payments change by less than 1 percent.

Our review of the wage data indicates

that the changes are attributable to

improved reporting, as well as relative

changes in labor costs.

Among the urban census divisions,

payments change by 0.3 percent or less

in all census divisions except one. The

East South Central census division

experiences an increase of 1.0 percent

which stems largely from wage index

increases of 5.9 and 5.2 percent in the

Mobile, Alabama and the Tuscaloosa,

Alabama MSAs.

Among the rural hospitals, all census

divisions experience increases except

for the Middle Atlantic census division

which experiences a slight decrease of

0.4 percent. The largest increase occurs

in the Pacific (and Puerto Rico,

discussed separately below) census

division which experiences an increase

of 1.1 percent. Here, Oregon’s rural

wage index value rises by 3.2 percent,

and Washington’s rural wage index

value increases by 2.9 percent. The next

largest increase (0.6 percent) occurs in

the rural New England and the East

South Central census divisions. In the

New England census division, the rural

Vermont wage index value increases by

4.4 percent, and the rural Maine wage

index value increases by 1.8 percent. In

the East South Central census division,

the rural Alabama wage index value

increases by 1.9 percent, and the rural

Mississippi wage index value increases

by 1.7 percent.

In Puerto Rico, payments increase by

0.3 percent for the urban hospitals and

by 2.4 percent for the five rural

hospitals. Although column 5 shows the

isolated effects of introducing the Puerto

Rico-specific wage index, it is also

included in the payment simulations

here showing the impacts of the new

wage data. Of the six urban areas in

Puerto Rico, two experience increases in

their national wage index values,

including the San Juan-Bayamon area

(2.5 percent), which contains the

majority of the urban Puerto Rico

hospitals (29 of 48), and the Mayaguez

area (6.2 percent). The rural Puerto Rico

area experiences an increase in its

national wage index value of 4.9

percent. The following chart compares

the shifts in wage index values for labor

market areas for FY 1998 with those

from FY 1997.

The majority of labor market areas

(334) experience less than a 5 percent

change. A total of 33 labor market areas

experience a change between 5 and 10

percent; 24 of those experience

increases. Still fewer labor markets

experience a change of more than 10

percent; two experience increases, and

one experiences a decrease. In two

urban labor market areas which include

both West Virginia and Ohio hospitals,

the Ohio hospitals receive their State’s

rural wage index value. In one of those

labor market areas, the Ohio hospitals

experience an increase of more than 10

percent. In the other labor market area,

the Ohio hospitals experience an

increase between 5 and 10 percent.

We reviewed the data for any area that

experienced a wage index change of 5
46124 Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations

percent or more to determine the reason

for the fluctuation.

Percentage change in area wage index values

No. of labor market areas

FY 1998 FY 1997

Increase more than 10 percent ................................................................................................................................ 2 0

Increase between 5 and 10 percent (inclusive) ....................................................................................................... 24 14

Increase or decrease less than 5 percent ............................................................................................................... 334 341

Decrease between 5 and 10 percent (inclusive) ..................................................................................................... 9 11

Decrease more than 10 percent .............................................................................................................................. 1 2

Under the FY 1998 wage index, 95.3

percent of urban hospitals and 99.9

percent of rural hospitals will

experience a change in their wage index

value of less than 5 percent. Among

urban hospitals, 128 will experience a

change of between 5 and 10 percent (97

increasing and 31 decreasing), while

only 3 rural hospitals fall into this

category, all decreasing. Eight urban

hospitals and no rural hospitals will

experience a change of more than 10

percent. The following chart shows the

projected impact for urban and rural

hospitals.

Percentage change in area

wage index values

No. of hospitals

Urban Rural

Increase more than 10

percent ........................... 4 0

Increase between 5 and

10 percent (inclusive) .... 97 0

Increase or decrease less

than 5 percent ............... 2763 2236

Decrease between 5 and

10 percent (inclusive) .... 31 3

Decrease more than 10

percent ........................... 4 0

E. Combined Impact of DRG and Wage

Index Changes— Including Budget

Neutrality Adjustment (Column 4)

The impact of DRG reclassifications

and recalibration on aggregate payments

is required by section 1886(d)(4)(C)(iii)

of the Act to be budget neutral. In

addition, section 1886(d)(3)(E) of the

Act specifies that any updates or

adjustments to the wage index are to be

budget neutral. Furthermore, as noted

above, section 4410 of Pub. L. 105–33

required the implementation of the

wage index floor to be budget neutral.

We compared aggregate payments using

the FY 1997 DRG relative weights and

wage index to aggregate payments using

the FY 1998 DRG relative weights and

wage index, including the wage index

floor. Based on this comparison, we

computed a wage and recalibration

budget neutrality factor of 0.997731. In

Table I, the combined overall impacts of

the effects of both the DRG

reclassifications and recalibration and

the updated wage index are shown in

column 4. The 0.0 percent impact for all

hospitals demonstrates that these

changes, in combination with the

budget neutrality factor, are budget

neutral.

For the most part, the changes in this

column are the sum of the changes in

columns 2 and 3, minus the

approximately 0.2 percent decrease

attributable to the budget neutrality

factor. There may be some variation of

plus or minus 0.1 percent due to

rounding.

F. Puerto Rico-Specific Wage Index

(Column 5)

As described in section III. of the

preamble to this final rule with

comment period, we are adopting a

Puerto Rico-specific wage index for FY

1998. These wage index values will be

applied to the Puerto Rico standardized

amounts. Column 5 shows the effect of

implementing this change results in no

payment impact for all hospitals. In

Puerto Rico, payments increase by 3.7

percent among urban hospitals, and 4.4

percent among rural hospitals. As

shown in Table 4F of the Addendum,

the Puerto Rico-specific wage index

values are considerably higher than

Puerto Rico’s national wage index

values (shown in Table 4A of the

Addendum). This results in the

increases shown in this column.

However, these increases are less than

those shown in the proposed rule as a

result of the change to the Puerto Rico

payment formula. The amount

attributable to the Puerto Rico payment

amount (and which is adjusted by the

Puerto Rico-specific wage index) is now

50 percent instead of 75 percent.

As indicated above, this change is

shown in isolation here for ease in

reading Table I. To actually calculate

the national DRG and wage index

budget neutrality factors, the Puerto

Rico-specific wage index was included.

As described in the Addendum, we also

computed a DRG reclassification and

recalibration budget neutrality

adjustment for the Puerto Rico

standardized amounts equal to

0.999117.

G. Outlier Changes (Column 6)

Currently, Medicare provides extra

payment in addition to the basic DRG

payment amount for extremely costly or

extraordinarily lengthy cases (cost

outliers and day outliers, respectively).

Beginning with FY 1995, section

1886(d)(5)(A) of the Act requires the

Secretary to phase-out payments for day

outliers. Under the requirements of

section 1886(d)(5)(A)(v), the proportion

of day outlier payments to total outlier

payments is reduced from FY 1994

levels as follows: 75 percent of FY 1994

levels in FY 1995, 50 percent of FY 1994

levels in FY 1996, and 25 percent of FY

1994 levels in FY 1997. For discharges

occurring after September 30, 1997, the

Secretary will no longer pay for day

outliers under the provisions of section

1886(d)(5)(A)(I) of the Act. This

reduction in day outlier payments will

be offset by an increase in cost outlier

payments.

As discussed in the Addendum, for

FY 1998, a case would receive cost

outlier payments if its costs exceed the

DRG payment amount plus any IME and

DSH payments by at least $11,050. We

are also maintaining the marginal cost

factor for cost outliers at 80 percent.

The payment impacts of these

changes are minimal. Hospital

categories negatively affected by

phasing-out day outliers are consistent

with the categories negatively affected

in previous years: urban Middle

Atlantic census division (0.7 percent

decline); urban hospitals with 500 or

more beds (0.2 percent decline);

teaching hospitals with 100 or more

residents (0.3 percent decline); and

hospitals for which data were

unavailable to calculate Medicare

utilization rates (1.5 percent decline).

This last category contains a number of

New York City public hospitals that file

manual cost reports. Because the

changes to the outlier policy result in a

shift in payments from cases paid as day

outliers to cases paid as cost outliers,

this indicates that these categories have

higher percentages of day outliers.
Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations 46125

H. Impact of MGCRB Reclassifications

(Column 7)

Our impact analysis to this point has

assumed hospitals are paid on the basis

of their actual geographic location (with

the exception of ongoing policies that

provide that certain hospitals receive

payments on bases other than where

they are geographically located, such as

hospitals in rural counties that are

deemed urban under section

1886(d)(8)(B) of the Act). The changes in

column 7 reflect the per case payment

impact of moving from this baseline to

a simulation incorporating the MGCRB

decisions for FY 1998. As noted below,

these decisions affect hospitals’

standardized amount and wage index

area assignments. In addition, rural

hospitals reclassified for purposes of the

standardized amount qualify to be

treated as urban for purposes of the DSH

adjustment.

By March 30 of each year, the MGCRB

makes reclassification determinations

that will be effective for the next fiscal

year, which begins on October 1. The

MGCRB may approve a hospital’s

reclassification request for the purpose

of using the other area’s standardized

amount, wage index value, or both.

The FY 1998 wage index values

incorporate all of the MGCRB’s

reclassification decisions for FY 1998 as

of the publication of this final rule with

comment period. The wage index values

also reflect any decisions made by the

HCFA Administrator through the

appeals and review process for MGCRB

decisions for FY 1998. The overall effect

of geographic reclassification is required

to be budget neutral by section

1886(d)(8)(D) of the Act. Therefore, we

applied an adjustment of 0.994720 to

ensure that the effects of reclassification

are budget neutral. (See section II.A.4 of

the Addendum to this final rule with

comment period.)

As a group, rural hospitals benefit

from geographic reclassification. Their

payments rise 2.2 percent, while

payments to urban hospitals decline 0.4

percent. Large urban hospitals lose 0.4

percent because, as a group, they have

the smallest percentage of hospitals that

are reclassified (fewer than 2 percent of

large urban hospitals are reclassified).

There are enough hospitals in other

urban areas that are reclassified to limit

the decrease in payments to urban

hospitals stemming from the budget

neutrality offset to 0.3 percent. Among

urban hospital groups generally (that is,

bed size, census division, and special

payment status), payments fall by

between 0.3 and 0.5 percent.

A positive impact is evident among

all rural hospital groups. The smallest

effect among the rural census divisions

is 1.1 percent for the Middle Atlantic

division. The largest impact is for the

West South Central division, with an

increase of 3.3 percent.

Among rural hospitals designated as

RRCs, 65 hospitals are reclassified for

purposes of the wage index only,

leading to the 4.3 percent increase in

payments among RRCs overall. This

positive impact on RRCs is also

reflected in the category of rural

hospitals with 200 or more beds, which

has a 4.2 percent increase in payments.

Rural hospitals reclassified for FY

1997 and FY 1998 experience a 9.0

percent increase in payments. This may

be due to the fact that these hospitals

have the most to gain from

reclassification and have been

reclassified for a period of years. Rural

hospitals reclassified for FY 1998 only

experience a 7.3 percent increase in

payments, while rural hospitals

reclassified for FY 1997 only experience

a 0.2 decrease in payments. Urban

hospitals reclassified for FY 1997 but

not FY 1998 experience a 1.0 percent

decline in payments overall. This

appears to be due to the combined

impacts of the budget neutrality

adjustment, and a number of BergenPassaic, New Jersey hospitals in this

category that experience a 4.8 percent

drop in their wage index after

reclassification. Urban hospitals

reclassified for FY 1998 but not for FY

1997 experience no overall change in

their payments.

The FY 1998 Reclassification rows of

Table I show the changes in payments

per case for all FY 1998 reclassified and

nonreclassified hospitals in urban and

rural locations for each of the three

reclassification categories (standardized

amount only, wage index only, or both).

The table illustrates that the largest

impact for reclassified rural hospitals is

for those hospitals reclassified for both

the standardized amount and the wage

index. These hospitals receive an 18.0

percent increase in payments. In

addition, rural hospitals reclassified just

for the wage index receive an 8.6

percent payment increase. The overall

impact on reclassified hospitals is to

increase their payments per case by an

average of 5.8 percent for FY 1998.

Among the 27 rural hospitals deemed

to be urban under section 1886(d)(8)(B)

of the Act, payments increase 0.7

percent due to MGCRB reclassification.

This is because, although these

hospitals are treated as being attached to

an urban area in our baseline (their

redesignation is ongoing, rather than

annual like the MGCRB

reclassifications), they are eligible for

MGCRB reclassification. For FY 1998,

one hospital in this category reclassified

to a large urban area.

The reclassification of hospitals

primarily affects payment to

nonreclassified hospitals through

changes in the wage index and the

geographic reclassification budget

neutrality adjustment required by

section 1886(d)(8)(D) of the Act. Among

hospitals that are not reclassified, the

overall impact of hospital

reclassifications is an average decrease

in payments per case of about 0.5

percent, which corresponds closely with

the geographic reclassification budget

neutrality factor. Rural nonreclassified

hospitals decrease slightly less,

experiencing a 0.4 percent decrease.

This occurs because the wage index

values in some rural areas increase after

reclassified hospitals are excluded from

the calculation of those indexes.

The foregoing analysis was based on

MGCRB and HCFA Administrator

decisions made by March 29, 1997. In

addition, changes to some MGCRB

decisions through the appeals, review,

and applicant withdrawal process are

also included.

I. All Changes (Column 8)

Column 8 compares our estimate of

payments per case, incorporating all

changes reflected in this final rule with

comment period for FY 1998 (including

statutory changes), to our estimate of

payments per case in FY 1997. It

includes the effects of the changes

enacted by Public Law 105–33, and

reflects the 0.3 percentage point

difference between the projected outlier

payments in FY 1998 (5.1 percent of

total DRG payments) and the current

estimate of the percentage of actual

outlier payments in FY 1997 (4.8

percent), as described in the

introduction to this Appendix and the

Addendum.

Column 8 also includes the impacts of

FY 1998 MGCRB reclassifications

compared to the payment impacts of FY

1997 reclassifications. (Column 7 shows

the impact of going from no MGCRB

reclassifications to the FY 1998

reclassifications.) When comparing FY

1998 payments to FY 1997 payments,

the percent changes due to FY 1998

reclassifications shown in column 7

need to be offset by the effects of

reclassification on hospitals’ FY 1997

payments (column 4 of Table 1,

September 1, 1996 final rule; 61 FR

46306). For example, the impact of

MGCRB reclassifications on rural

hospitals’ FY 1997 payments was

approximately a 2.3 percent increase,

offsetting the 2.2 percent increase in

column 7. Therefore, the net change in

FY 1998 payments due to
46126 Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations

reclassification for rural hospitals is

actually closer to a decrease of 0.1

percent relative to FY 1997. However,

last year’s analysis contained a

somewhat different set of hospitals, so

this might affect the numbers slightly.

To factor in the effects of the changes

from Public Law 105–33 from column 1

into the overall changes shown in this

column, it is first necessary to deduct

the impact of the zero update included

in column 1. Because column 1

compares a FY 1998 baseline after

Public Law 105–33 to a FY 1998

baseline before this law was enacted, it

includes the impact of going from a FY

1998 update of 2.7 percent to a zero

update. Of course, this 2.7 percent

update for FY 1998 does not affect FY

1997 payments, so it does not show up

in column 8. The impacts of the other

changes, however, such as reducing the

IME factor and eliminating the IME and

DSH adjustments from outlier

payments, are reflected in this column.

Finally, there might also be

interactive effects among the various

factors comprising the payment system

that we are not able to isolate. For these

reasons, the values in column 8 may not

equal the sum of the changes in column

1, minus 2.7, plus the changes in

columns 4 through 7 (plus the other

impacts that we are able to identify).

The overall payment change from FY

1998 to FY 1997 for all hospitals is a 0.9

percent decrease. This reflects the 0.0

percent net change in total payments

due to the proposed changes for FY

1998 shown in columns 4 through 7, the

zero update for FY 1998, the 0.3 percent

higher outlier payments in FY 1998

compared to FY 1997, as discussed

above, and the 1.2 percent decline in

payments due to Public Law 105–33 (3.9

percent decrease in column 1 minus 2.7

percent for the FY 1998 update). This

1.2 percent decline is attributable

largely to reducing IME and eliminating

IME and DSH from outlier payments.

Hospitals in urban areas experience a

1.0 percent drop in payments per case

from FY 1997. Similar to all hospitals

nationally, this is primarily due to the

factors discussed above. Urban

hospitals’ 0.4 negative impact in FY

1998 due to reclassification is offset by

a similar impact from FY 1997

reclassifications. Hospitals in large and

other urban areas experience 1.2 percent

and 0.7 percent decreases, respectively.

The larger decrease for large urban

hospitals is primarily due to the

reduction in IME payments. Overall

payments per case among this group of

hospitals would be approximately 0.8

percent higher without this reduction.

Hospitals in rural areas generally fare

better during FY 1998 than do urban

hospitals. Overall, rural hospitals

experience a decrease of 0.4 percent.

This smaller decrease for rural hospitals

appears to be primarily attributable to

the special category rural hospitals. In

particular, the 368 rural hospitals

categorized as MDHs experience a 0.8

percent average payment increase. As

noted previously, hospitals paid on the

basis of the hospital-specific rate

generally see less negative impact due to

the changes in Public Law 105–33

because they do not receive IME, DSH,

or outliers.

Puerto Rico stands out as having large

payment increases for FY 1998, with

urban Puerto Rico hospitals’ payments

increasing by 12.2 percent, and rural

Puerto Rico hospitals’ payments

increasing by 15.3 percent. As noted

above, this is largely due to the

implementation of the Puerto Ricospecific wage index during FY 1998 and

the change to the payment formula for

Puerto Rico hospitals in Public Law

105–33.

Among census divisions, East South

Central displays the only increase

among urban hospitals, 0.2 percent.

This is related to the 1.0 percent overall

increase due to the new wage data. On

the other hand, the urban Middle

Atlantic and New England hospitals

lose 2.0 percent and 1.9 percent per

case, respectively. This is largely related

to the concentration of teaching

hospitals in these census areas. In

addition, the Middle Atlantic hospitals

lose 0.7 percent due to the elimination

of day outlier payments, and the New

England hospitals lose 0.3 percent as a

result of the new wage data.

Among rural census divisions, the

Mountain division displays an overall

increase of 0.3 percent. This positive

impact is largely due to hospitals

reclassified during FY 1998 that were

not reclassified during FY 1997.

Hospitals in the South Atlantic are the

biggest losers among the rural census

divisions, with FY 1998 average

payments per case falling by 1.0 percent

from FY 1997. Twenty hospitals

reclassified here during FY 1997 are no

longer reclassified during FY 1998.

Rural Middle Atlantic hospitals are

negatively impacted by the DRG

recalibration, new wage data, and

eliminating the day outlier payments,

all leading to their 0.9 percent decrease

in FY 1998 payments.

As expected, large teaching hospitals

as a group experience the largest

payment reductions. Those with more

than 100 residents see payments per

case decrease by 1.6 percent. Urban

hospitals receiving both IME and DSH

experience 1.2 percent payment

reductions. Hospitals for which we were

unable to determine ownership

designation or Medicare utilization due

to a lack of cost report data, lose 2.4

percent in payments. As indicated

previously, this category contains a

number of public New York City

hospitals, many of which have large

teaching programs.

The largest negative payment impacts

from FY 1997 to FY 1998 are among

hospitals that were reclassified for FY

1997 and are not reclassified for FY

1998. Overall, these hospitals lose 4.2

percent. On the other hand, hospitals

reclassified for FY 1998 that were not

reclassified for FY 1997 would

experience the greatest payment

increases (aside from Puerto Rico

hospitals): 7.3 percent for 76 rural

hospitals in this category and 2.8

percent for 13 urban hospitals.

TABLE II.—IMPACT ANALYSIS OF CHANGES FOR FY 1998 OPERATING PROSPECTIVE PAYMENT SYSTEM

[Payments per case]

No. of hospitals

Average FY

1997 payment per

case

Average FY

1998 payment per

case

All changes

(1) (2) 1 (3) 1 (4)

(BY GEOGRAPHIC LOCATION):

ALL HOSPITALS ....................................................................................................... 5,088 6,771 6,711 ¥0.9

URBAN HOSPITALS ................................................................................................. 2,858 7,347 7,276 ¥1.0

LARGE URBAN AREAS ........................................................................................... 1,630 7,899 7,808 ¥1.2

OTHER URBAN AREAS ........................................................................................... 1,228 6,588 6,545 ¥0.7
Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations 46127

TABLE II.—IMPACT ANALYSIS OF CHANGES FOR FY 1998 OPERATING PROSPECTIVE PAYMENT SYSTEM—Continued

[Payments per case]

No. of hospitals

Average FY

1997 payment per

case

Average FY

1998 payment per

case

All changes

(1) (2) 1 (3) 1 (4)

RURAL AREAS ......................................................................................................... 2,230 4,451 4,432 ¥0.4

BED SIZE (URBAN):

0–99 BEDS ................................................................................................................ 724 4,921 4,878 ¥0.9

100–199 BEDS .......................................................................................................... 954 6,159 6,115 ¥0.7

200–299 BEDS .......................................................................................................... 570 6,926 6,868 ¥0.8

300–499 BEDS .......................................................................................................... 457 7,874 7,794 ¥1.0

500 OR MORE BEDS ............................................................................................... 153 9,660 9,535 ¥1.3

BED SIZE (RURAL):

0–49 BEDS ................................................................................................................ 1,170 3,650 3,639 ¥0.3

50–99 BEDS .............................................................................................................. 657 4,152 4,141 ¥0.3

100–149 BEDS .......................................................................................................... 235 4,615 4,594 ¥0.5

150–199 BEDS .......................................................................................................... 93 4,794 4,775 ¥0.4

200 OR MORE BEDS ............................................................................................... 75 5,612 5,570 ¥0.8

URBAN BY CENSUS DIV.:

NEW ENGLAND ...................................................................................................... 159 7,913 7,766 ¥1.9

MIDDLE ATLANTIC .................................................................................................. 431 8,137 7,971 ¥2.0

SOUTH ATLANTIC ................................................................................................... 420 7,008 6,953 ¥0.8

EAST NORTH CENTRAL ......................................................................................... 475 7,057 7,004 ¥0.7

EAST SOUTH CENTRAL ......................................................................................... 163 6,518 6,530 0.2

WEST NORTH CENTRAL ........................................................................................ 191 6,948 6,905 ¥0.6

WEST SOUTH CENTRAL ........................................................................................ 367 6,830 6,797 ¥0.5

MOUNTAIN ............................................................................................................... 129 7,084 7,041 ¥0.6

PACIFIC .................................................................................................................... 475 8,422 8,343 ¥0.9

PUERTO RICO ......................................................................................................... 48 2,694 3,022 12.2

RURAL BY CENSUS DIV.:

NEW ENGLAND ........................................................................................................ 53 5,283 5,249 ¥0.6

MIDDLE ATLANTIC .................................................................................................. 85 4,752 4,708 ¥0.9

SOUTH ATLANTIC ................................................................................................... 297 4,631 4,582 ¥1.0

EAST NORTH CENTRAL ......................................................................................... 302 4,502 4,470 ¥0.7

EAST SOUTH CENTRAL ......................................................................................... 275 4,115 4,116 0.0

WEST NORTH CENTRAL ........................................................................................ 512 4,140 4,138 0.0

WEST SOUTH CENTRAL ........................................................................................ 347 4,005 3,994 ¥0.3

MOUNTAIN ............................................................................................................... 213 4,772 4,787 0.3

PACIFIC .................................................................................................................... 141 5,582 5,578 ¥0.1

PUERTO RICO ......................................................................................................... 5 2,072 2,390 15.3

(BY PAYMENT CATEGORIES):

URBAN HOSPITALS ................................................................................................. 2,948 7,309 7,239 ¥1.0

LARGE URBAN AREAS ........................................................................................... 1,776 7,763 7,675 ¥1.1

OTHER URBAN AREAS ........................................................................................... 1,172 6,590 6,548 ¥0.6

RURAL AREAS ......................................................................................................... 2,140 4,429 4,409 ¥0.5

TEACHING STATUS:

NON-TEACHING ....................................................................................................... 3,993 5,494 5,462 ¥0.6

FEWER THAN 100 RESIDENTS .............................................................................. 856 7,216 7,158 ¥0.8

100 OR MORE RESIDENTS .................................................................................... 239 11,051 10,869 ¥1.6

DISPROPORTIONATE SHARE HOSPITALS (DSH):

NON-DSH .................................................................................................................. 3,185 5,801 5,755 ¥0.8

URBAN DSH—100 BEDS OR MORE ...................................................................... 1,413 7,997 7,917 ¥1.0

FEWER THAN 100 BEDS ........................................................................................ 89 5,081 5,041 ¥0.8

RURAL DSH SOLE COMMUNITY (SCH) ................................................................ 155 4,229 4,211 ¥0.4

REFERRAL CENTERS (RRC) .................................................................................. 50 5,203 5,232 0.6

OTHER RURAL DSH HOSP.—100 BEDS OR MORE ............................................ 66 4,198 4,138 ¥1.4

FEWER THAN 100 BEDS ........................................................................................ 130 3,565 3,557 ¥0.2

URBAN TEACHING AND DSH:

BOTH TEACHING AND DSH ................................................................................... 708 8,994 8,884 ¥1.2

TEACHING AND NO DSH ........................................................................................ 330 7,377 7,301 ¥1.0

NO TEACHING AND DSH ........................................................................................ 794 6,413 6,381 ¥0.5

NO TEACHING AND NO DSH ................................................................................. 1,116 5,664 5,621 ¥0.8

SPECIAL UPDATE HOSPITALS (UNDER SEC. 4401(b) OF PUBLIC LAW 105–33 .... 360 5,276 5,247 ¥0.6

RURAL HOSPITAL TYPES:

NONSPECIAL STATUS HOSPITALS ....................................................................... 915 3,945 3,915 ¥0.8

RRC ........................................................................................................................... 158 5,132 5,107 ¥0.5

SCH/EACH ................................................................................................................ 642 4,533 4,514 ¥0.4

MDH .......................................................................................................................... 368 3,511 3,540 0.8

SCH/EACH AND RRC .............................................................................................. 57 5,315 5,291 ¥0.5

TYPE OF OWNERSHIP:

VOLUNTARY ............................................................................................................. 2,924 6,945 6,876 ¥1.0
46128 Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations

TABLE II.—IMPACT ANALYSIS OF CHANGES FOR FY 1998 OPERATING PROSPECTIVE PAYMENT SYSTEM—Continued

[Payments per case]

No. of hospitals

Average FY

1997 payment per

case

Average FY

1998 payment per

case

All changes

(1) (2) 1 (3) 1 (4)

PROPRIETARY ......................................................................................................... 701 6,154 6,120 ¥0.6

GOVERNMENT ......................................................................................................... 1,346 6,278 6,250 ¥0.4

UNKNOWN ................................................................................................................ 117 8,176 7,979 ¥2.4

MEDICARE UTILIZATION AS A PERCENT OF INPATIENT DAYS:

0–25 ........................................................................................................................... 266 8,955 8,850 ¥1.2

25–50 ......................................................................................................................... 1,307 8,229 8,148 ¥1.0

50–65 ......................................................................................................................... 1,988 6,180 6,133 ¥0.8

OVER 65 ................................................................................................................... 1,410 5,243 5,196 ¥0.9

UNKNOWN ................................................................................................................ 117 8,176 7,979 ¥2.4

HOSPITALS RECLASSIFIED BY THE MEDICARE GEOGRAPHIC REVIEW BOARD

RECLASSIFICATION STATUS DURING FY97 AND FY98:

RECLASSIFIED DURING BOTH FY97 AND FY98: 333 6,137 6,083 ¥0.9

URBAN ............................................................................................................... 96 7,297 7,215 ¥1.1

RURAL ............................................................................................................... 237 5,253 5,221 ¥0.6

RECLASSIFIED DURING FY98 ONLY 89 5,199 5,475 5.3

URBAN ............................................................................................................... 13 6,729 6,920 2.8

RURAL ............................................................................................................... 76 4,389 4,710 7.3

RECLASSIFIED DURING FY97 ONLY 211 6,047 5,793 ¥4.2

URBAN ............................................................................................................... 94 6,981 6,704 ¥4.0

RURAL ............................................................................................................... 117 4,726 4,504 ¥4.7

FY 98 RECLASSIFICATIONS:

ALL RECLASSIFIED HOSP.: 423 5,994 5,990 ¥0.1

STAND. AMT. ONLY ......................................................................................... 94 5,941 5,885 ¥0.9

WAGE INDEX ONLY ......................................................................................... 282 5,923 5,936 0.2

BOTH ................................................................................................................. 47 6,333 6,348 0.2

NONRECLASS. .................................................................................................. 4,638 6,855 6,788 ¥1.0

ALL URBAN RECLASS.: 109 7,226 7,178 ¥0.7

STAND. AMT. ONLY ......................................................................................... 45 6,449 6,390 ¥0.9

WAGE INDEX ONLY ......................................................................................... 31 9,160 9,085 ¥0.8

BOTH ................................................................................................................. 33 6,578 6,568 ¥0.1

NONRECLASS. .................................................................................................. 2,749 7,353 7,281 ¥1.0

ALL RURAL RECLASS.: 314 5,104 5,133 0.6

STAND. AMT. ONLY ......................................................................................... 49 4,530 4,480 ¥1.1

WAGE INDEX ONLY ......................................................................................... 251 5,162 5,195 0.6

BOTH ................................................................................................................. 14 5,356 5,472 2.2

NONRECLASS. .................................................................................................. 1,889 4,212 4,175 ¥0.9

OTHER RECLASSIFIED HOSPITALS (SECTION 1886(d)(8)(B)) .................................. 27 4,740 4,744 0.1

1These payment amounts per case do not reflect any estimates of annual case-mix increase.

Table II presents the projected impact

of the changes for FY 1998 for urban

and rural hospitals and for the different

categories of hospitals shown in Table I.

It compares the projected payments per

case for FY 1998 with the average

estimated per case payments for FY

1997, as calculated under our models.

Thus, this table presents, in terms of the

average dollar amounts paid per

discharge, the combined effects of the

changes presented in Table I. The

percentage changes shown in the last

column of Table II equal the percentage

changes in average payments from

column 8 of Table I.

VII. Impact of Changes in the Capital

Prospective Payment System

A. General Considerations

We now have data that were

unavailable in previous impact analyses

for the capital prospective payment

system. Specifically, we have cost report

data for the fourth year of the capital

prospective payment system (cost

reports beginning in FY 1995) available

through the June 13, 1997 update of the

Health Care Provider Cost Report

Information System (HCRIS). We also

have updated information on the

projected aggregate amount of obligated

capital approved by the fiscal

intermediaries. However, our impact

analysis of payment changes for capitalrelated costs is still limited by the lack

of hospital-specific data on several

items. These are the hospital’s projected

new capital costs for each year and its

projected old capital costs for each year.

The lack of this information affects our

impact analysis in the following ways:

• Major investment in hospital capital

assets (for example in building and

major fixed equipment) occurs at

irregular intervals. As a result, there can

be significant variation in the growth

rates of Medicare capital-related costs

per case among hospitals. We do not

have the necessary hospital-specific

budget data to project the hospital

capital growth rate for individual

hospitals.

• Moreover, our policy of recognizing

certain obligated capital as old capital

makes it difficult to project future

capital-related costs for individual

hospitals. Under § 412.302(c), a hospital
Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations 46129

is required to notify its intermediary

that it has obligated capital by the later

of October 1, 1992, or 90 days after the

beginning of the hospital’s first cost

reporting period under the capital

prospective payment system. The

intermediary must then notify the

hospital of its determination whether

the criteria for recognition of obligated

capital have been met by the later of the

end of the hospital’s first cost reporting

period subject to the capital prospective

payment system or 9 months after the

receipt of the hospital’s notification.

The amount that is recognized as old

capital is limited to the lesser of the

actual allowable costs when the asset is

put in use for patient care or the

estimated costs of the capital

expenditure at the time it was obligated.

We have substantial information

regarding intermediary determinations

of projected aggregate obligated capital

amounts. However, we still do not know

when these projects will actually be put

into use for patient care, the actual

amount that will be recognized as

obligated capital when the project is put

into use, or the Medicare share of the

recognized costs. Therefore, we do not

know actual obligated capital

commitments for purposes of the FY

1998 capital cost projections. We

discuss in Appendix B the assumptions

and computations we employ to

generate the amount of obligated capital

commitments for use in the FY 1998

capital cost projections.

In Table III of this appendix, we

present the redistributive effects that are

expected to occur between ‘‘holdharmless’’ hospitals and ‘‘fully

prospective’’ hospitals in FY 1998. In

addition, we have integrated sufficient

hospital-specific information into our

actuarial model to project the impact of

the FY 1998 capital payment policies by

the standard prospective payment

system hospital groupings. We caution

that while we now have actual

information on the effects of the

transition payment methodology and

interim payments under the capital

prospective payment system and cost

report data for most hospitals, we need

to randomly generate numbers for the

change in old capital costs, new capital

costs for each year, and obligated

amounts that will be put in use for

patient care services and recognized as

old capital each year. We continue to be

unable to predict accurately FY 1998

capital costs for individual hospitals,

but with the more recent data on the

experience to date under the capital

prospective payment system, there is

adequate information to estimate the

aggregate impact on most hospital

groupings.

We have revised Table III since the

publication of the proposed rule to

provide some information on the effects

of the Balanced Budget Act of 1997.

Section 4402 of Public Law 105–33

requires a 17.78 percent reduction to the

unadjusted standard Federal rate for

discharges occurring on or after October

1, 1997. Specifically, we are presenting

separate blocks in Table III to show (1)

what the effects on FY 1998 payments

would have been in the absence of the

17.78 percent reduction to the standard

Federal rate, and (2) the effects of all

changes, including the 17.78 percent

reduction to the standard rate, on

payments in FY 1998. In Table III, we

used the same outlier effects that we

used in conjunction with setting the

final rate for FY 1998 (that is, the rate

with the effects of the 17.78 percent

reduction to the standard rate). If we

had recalibrated outliers for the

unreduced Federal rate, the estimated

rate might have been slightly different.

However, the estimates in Table III of

the effects without the reduction to the

standard Federal rate are adequate for

the purpose of evaluating the relative

impact of the Balanced Budget Act of

1997.

We present the transition payment

methodology by hospital grouping in

Table IV. In Table V we present the

results of the cross-sectional analysis

using the results of our actuarial model.

This table presents the aggregate impact

of the FY 1998 payment policies. We

have also revised Table V to provide

information on the effects of the

Balanced Budget Act of 1997.

Specifically, we have added two

additional columns to Table V. The first

additional column presents the average

FY 1998 payments per case without the

effects of the Balanced Budget Act of

1997. The second column presents

changes attributable solely to the

Balanced Budget Act of 1997.

B. Projected Impact Based on the FY

1998 Actuarial Model

1. Assumptions

In this impact analysis, we model

dynamically the impact of the capital

prospective payment system from FY

1997 to FY 1998 using a capital cost

model. The FY 1998 model, described

in Appendix B of this final rule with

comment period, integrates actual data

from individual hospitals with

randomly generated capital cost

amounts. We have capital cost data from

cost reports beginning in FY 1989

through FY 1995 received through the

June 13, 1997 update of HCRIS, interim

payment data for hospitals already

receiving capital prospective payments

through PRICER, and data reported by

the intermediaries that include the

hospital-specific rate determinations

that have been made through July 1,

1997 in the provider-specific file. We

used these data to determine the FY

1998 capital rates. However, we do not

have individual hospital data on old

capital changes, new capital formation,

and actual obligated capital costs. We

have data on costs for capital in use in

FY 1995, and we age that capital by a

formula described in Appendix B. We

therefore need to randomly generate

only new capital acquisitions for any

year after FY 1995. All Federal rate

payment parameters are assigned to the

applicable hospital.

Recently available cost report data

indicate that old capital costs are

declining faster than we previously

projected. Consequently, for FY 1998 we

are projecting faster declines in old

capital. To make up for the larger

declines in old capital, we are projecting

faster growth in new capital. The

combination of these two factors will

make the 100-percent Federal rate

higher than the hold-harmless rate for

some hold-harmless hospitals.

Therefore, we are now projecting that

more hospitals will move to the 100-

percent Federal rate than previously

projected.

For purposes of this impact analysis,

the FY 1998 actuarial model includes

the following assumptions:

• Medicare inpatient capital costs per

discharge are projected to change at the

following rates during these periods:

Average percentage change in capital costs

per discharge

Fiscal year Percentage

change

1996 .......................................... ¥2.84

1997 .......................................... 4.46

1998 .......................................... 4.50

• The Medicare case-mix index will

increase by 0.5 percent in FY 1997 and

by 1.0 in FY 1998.

• Beginning in FY 1996 (with the

expiration of budget neutrality), the

Federal capital rate and hospitalspecific rate were updated by an

analytical framework that considers

changes in the prices associated with

capital-related costs, and adjustments to

account for forecast error, changes in the

case-mix index, allowable changes in

intensity, and other factors. The final FY

1998 update for inflation is 0.90 percent

(see section III of the Addendum).
46130 Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations

2. Results

We have used the actuarial model to

estimate the change in payment for

capital-related costs from FY 1997 to FY

1998. Table III shows the effect of the

capital prospective payment system on

low capital cost hospitals and high

capital cost hospitals. We consider a

hospital to be a low capital cost hospital

if, based on a comparison of its initial

hospital-specific rate and the applicable

Federal rate, it will be paid under the

fully prospective payment methodology.

A high capital cost hospital is a hospital

that, based on its initial hospitalspecific rate, will be paid under the

hold-harmless payment methodology.

Based on our actuarial model, the

breakdown of hospitals is as follows:

Capital transition payment methodology

Type of hospital Percent of

hospitals

FY 1998

percent of

discharges

FY 1998

percent of

capital costs

FY 1998

percent of

capital payments

Low Cost Hospital ............................................................................................................ 66 62 56 58

High Cost Hospital ............................................................................................................ 34 38 44 42

A low capital cost hospital may

request to have its hospital-specific rate

redetermined based on old capital costs

in the current year, through the later of

the hospital’s cost reporting period

beginning in FY 1994 or the first cost

reporting period beginning after

obligated capital comes into use (within

the limits established in § 412.302(e) for

putting obligated capital in use for

patient care). If the redetermined

hospital-specific rate is greater than the

adjusted Federal rate, these hospitals

will be paid under the hold-harmless

payment methodology. Regardless of

whether the hospital became a holdharmless payment hospital as a result of

a redetermination, we have continued to

show these hospitals as low capital cost

hospitals in Table III.

Assuming no behavioral changes in

capital expenditures, Table III displays

the percentage change in payments from

FY 1997 to FY 1998 using the above

described actuarial model. With the

final FY 1998 Federal rate, we estimate

aggregate Medicare capital payments

will decrease by 6.74 percent in FY

1998. The main reason for this decrease

is the impact of the 17.78 percent

reduction to the Federal rate and the

hospital-specific rate.

TABLE III.—IMPACT OF FINAL CHANGES FOR FY 1998 ON PAYMENTS PER DISCHARGE

No. of

hospitalsDischarges

Adjusted

Federal

payment

Average

Federal

percent

Hospital

specific

payment

Hold

harmless

payment

Exceptions

payment

Total

payment

Percent

change

over FY

1997

FY 1997 Payments per Discharge

Low Cost Hospitals ................................................... 3,331 6,898,994 464.25 63.57 135.71 3.07 11.79 614.82 ..............

Fully Prospective ............................................... 3,078 6,246,888 436.83 60.00 149.88 .............. 12.52 599.23 ..............

100% Federal Rate ............................................ 235 609,412 752.47 100.00 .............. .............. 3.30 755.77 ..............

Hold Harmless ................................................... 18 42,693 362.22 48.77 .............. 496.62 25.67 884.51 ..............

High Cost Hospitals .................................................. 1,684 4,226,709 733.06 97.27 .............. 26.00 8.63 767.69 ..............

100% Federal Rate ............................................ 1,522 3,963,050 757.10 100.00 .............. .............. 6.29 763.39 ..............

Hold Harmless ................................................... 162 263,659 371.65 52.95 .............. 416.84 43.77 832.26 ..............

Total Hospitals ............................................... 5,015 11,125,703 566.37 76.62 84.15 11.78 10.59 672.90 ..............

FY 1998 Payments per Discharge Before Effects of

the Balanced Budget Act of 1997

Low Cost Hospitals ................................................... 3,331 7,064,036 568.02 72.69 108.16 2.43 10.80 689.41 12.13

Fully Prospective ............................................... 3,078 6,396,330 545.02 70.00 119.46 .............. 11.49 675.96 12.81

100% Federal Rate ............................................ 241 632,394 806.40 100.00 .............. .............. 2.75 809.15 7.06

Hold Harmless ................................................... 12 35,312 464.85 54.94 .............. 486.07 30.35 981.26 10.94

High Cost Hospitals .................................................. 1,684 4,327,823 808.62 98.86 .............. 11.55 10.34 830.51 8.18

100% Federal Rate ............................................ 1,591 4,191,128 819.68 100.00 .............. .............. 8.26 827.95 8.46

Hold Harmless ................................................... 93 136,695 469.57 61.33 .............. 365.62 73.98 909.17 9.24

Total Hospitals ............................................... 5,015 11,391,859 659.42 82.91 67.07 5.89 10.63 743.02 10.42

FY 1998 Payments per Discharge After Effects of

the Balanced Budget Act of 1997

Low Cost Hospitals ................................................... 3,331 7,064,036 458.51 72.64 87.16 2.73 22.08 570.48 –7.21

Fully Prospective ............................................... 3,078 6,396,330 440.41 70.00 96.25 .............. 23.19 559.85 –6.57

100% Federal Rate ............................................ 238 626,061 650.85 100.00 .............. .............. 7.55 658.40 –12.88

Hold Harmless ................................................... 15 41,645 348.31 53.30 .............. 462.72 69.84 880.87 –0.41

High Cost Hospitals .................................................. 1,684 4,327,823 643.55 97.70 .............. 20.40 18.16 682.10 –11.15

100% Federal Rate ............................................ 1,528 4,070,204 662.07 100.00 .............. .............. 15.37 677.44 –11.26

Hold Harmless ................................................... 156 257,620 351.00 57.92 .............. 342.67 62.11 755.78 –9.19

Total Hospitals ............................................... 5,015 11,391,859 528.81 82.41 54.04 9.44 20.59 612.88 –8.92
Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations 46131

We project that low capital cost

hospitals paid under the fully

prospective payment methodology will

experience an average decrease in

payments per case of 6.57 percent, and

that high capital cost hospitals will

experience an average decrease of 11.15

percent.

For hospitals paid under the fully

prospective payment methodology, the

Federal rate payment percentage will

increase from 60 percent to 70 percent

and the hospital-specific rate payment

percentage will decrease from 40 to 30

percent in FY 1998. The Federal rate

payment percentage for hospitals paid

under the hold-harmless payment

methodology is based on the hospital’s

ratio of new capital costs to total capital

costs. The average Federal rate payment

percentage for high cost hospitals

receiving a hold-harmless payment for

old capital will increase from 52.95

percent to 57.92 percent. Without the

effects of the Balanced Budget Act of

1997, we estimate that this figure would

have increased to 61.33 percent. We

estimate the percentage of holdharmless hospitals paid based on 100

percent of the Federal rate will increase

from 90.7 percent to 91.2 percent.

Excluding the effects of the Balanced

Budget Act of 1997, we estimate that the

percentage of hold-harmless hospitals

paid based on 100 percent of the Federal

rate would have increased to 94.6

percent.

We expect that the average hospitalspecific rate payment per discharge will

decrease from $84.15 in FY 1997 to

$54.04 in FY 1998. This is partly due to

the decrease in the hospital-specific rate

payment percentage from 40 percent in

FY 1997 to 30 percent in FY 1998.

Excluding the effects of the Balanced

Budget Act of 1997, we estimate that the

average hospital-specific payment per

discharge would have decreased less

dramatically to $67.07 in FY 1998.

For FY 1998, the minimum payment

levels are:

• 90 percent for sole community

hospitals;

• 80 percent for urban hospitals with

100 or more beds and a disproportionate

share patient percentage of 20.2 percent

or more; or

• 70 percent for all other hospitals.

We estimate that exceptions payments

will increase from 1.57 percent of total

capital payments in FY 1997 to 3.36

percent of payments in FY 1998. These

figures are lower than prior estimates

due to refinements to our actuarial

model. For a further explanation of

these refinements, refer to Section B of

this Appendix.

The projected distribution of the

payments is shown in the table below:

Estimated FY 1998 exceptions payments

Type of hospital No. of hospitals

Percent of

exceptions

payments

Low Capital Cost 314 67

High Capital

Cost ............... 198 33

Total ....... 512 100

C. Cross-Sectional Comparison of

Capital Prospective Payment

Methodologies

Table IV presents a cross-sectional

summary of hospital groupings by

capital prospective payment

methodology. This distribution is

generated by our actuarial model.

TABLE IV.—DISTRIBUTION BY METHOD OF PAYMENT (HOLD-HARMLESS/FULLY PROSPECTIVE) OF HOSPITALS RECEIVING

CAPITAL PAYMENTS

(1)

Total No. of

hospitals

(2)

Hold-harmless (3)

Percentage

paid fully

prospective

rate

Percentage

paid holdharmless

(A)

Percentage

paid fully

federal

(B)

By Geographic Location:

All hospitals ............................................................................................................... 5,015 3.4 35.2 61.4

Large urban areas (populations over 1 million) ........................................................ 1,590 3.9 42.7 53.4

Other urban areas (populations of 1 million or fewer) .............................................. 1,209 4.2 43.4 52.4

Rural areas ................................................................................................................ 2,216 2.6 25.4 72.0

Urban hospitals ......................................................................................................... 2,799 4.0 43.0 52.9

0–99 beds .......................................................................................................... 674 4.7 36.8 58.5

100–199 beds .................................................................................................... 946 5.6 48.9 45.5

200–299 beds .................................................................................................... 569 3.3 43.8 52.9

300–499 beds .................................................................................................... 457 1.8 40.3 58.0

500 or more beds ............................................................................................... 153 0.7 39.2 60.1

Rural hospitals ........................................................................................................... 2,216 2.6 25.4 72.0

0–49 beds .......................................................................................................... 1,158 2.2 17.6 80.1

50–99 beds ........................................................................................................ 655 3.4 30.1 66.6

100–149 beds .................................................................................................... 235 2.1 40.4 57.4

150–199 beds .................................................................................................... 93 4.3 31.2 64.5

200 or more beds ............................................................................................... 75 1.3 49.3 49.3

By Region:

Urban by Region ....................................................................................................... 2,799 4.0 43.0 52.9

New England ...................................................................................................... 158 0.0 27.8 72.2

Middle Atlantic .................................................................................................... 426 1.6 36.9 61.5

South Atlantic ..................................................................................................... 414 4.1 55.1 40.8

East North Central ............................................................................................. 471 3.8 33.5 62.6

East South Central ............................................................................................. 159 5.7 52.8 41.5

West North Central ............................................................................................ 188 4.8 38.3 56.9

West South Central ............................................................................................ 344 10.2 58.4 31.4

Mountain ............................................................................................................. 124 3.2 51.6 45.2

Pacific ................................................................................................................. 467 2.6 39.4 58.0

Puerto Rico ........................................................................................................ 48 4.2 25.0 70.8

Rural by Region ........................................................................................................ 2,216 2.6 25.4 72.0

New England ...................................................................................................... 53 0.0 22.6 77.4
46132 Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations

TABLE IV.—DISTRIBUTION BY METHOD OF PAYMENT (HOLD-HARMLESS/FULLY PROSPECTIVE) OF HOSPITALS RECEIVING

CAPITAL PAYMENTS—Continued

(1)

Total No. of

hospitals

(2)

Hold-harmless (3)

Percentage

paid fully

prospective

rate

Percentage

paid holdharmless

(A)

Percentage

paid fully

federal

(B)

Middle Atlantic .................................................................................................... 84 2.4 29.8 67.9

South Atlantic ..................................................................................................... 293 2.0 33.4 64.5

East North Central ............................................................................................. 301 1.3 20.9 77.7

East South Central ............................................................................................. 273 2.2 34.8 63.0

West North Central ............................................................................................ 511 2.7 17.8 79.5

West South Central ............................................................................................ 345 2.6 28.7 68.7

Mountain ............................................................................................................. 211 6.2 19.9 73.9

Pacific ................................................................................................................. 140 2.9 25.7 71.4

Large urban areas (populations over 1 million) ............................................................... 1,735 3.6 42.6 53.8

Other urban areas (populations of 1 million or fewer) ..................................................... 1,153 4.3 42.8 52.9

Rural areas ....................................................................................................................... 2,127 2.7 25.1 72.2

Teaching Status:

Non-teaching ............................................................................................................. 3,922 3.5 34.9 61.6

Fewer than 100 Residents ........................................................................................ 855 3.9 37.5 58.6

100 or more Residents .............................................................................................. 238 0.4 31.9 67.6

Disproportionate share hospitals (DSH):

Non-DSH ................................................................................................................... 3,129 3.6 31.3 65.2

Urban DSH:

100 or more beds ............................................................................................... 1,408 3.3 45.7 51.0

Less than 100 beds ........................................................................................... 81 2.5 34.6 63.0

Rural DSH:

Sole Community (SCH/EACH) ........................................................................... 154 4.5 20.8 74.7

Referral Center (RRC/EACH) ............................................................................ 50 2.0 52.0 46.0

Other Rural:

100 or more beds ....................................................................................... 66 1.5 39.4 59.1

Less than 100 beds .................................................................................... 127 0.8 26.0 73.2

Urban teaching and DSH:

Both teaching and DSH ............................................................................................ 707 2.3 38.0 59.7

Teaching and no DSH ............................................................................................... 329 4.6 32.8 62.6

No teaching and DSH ............................................................................................... 782 4.2 51.4 44.4

No teaching and no DSH .......................................................................................... 1,070 4.6 42.3 53.1

Rural Hospital Types:

Non special status hospitals ..................................................................................... 905 1.3 26.5 72.2

RRC/EACH ................................................................................................................ 158 1.3 41.8 57.0

SCH/EACH ................................................................................................................ 641 5.8 22.5 71.8

Medicare-dependent hospitals (MDH) ...................................................................... 366 0.8 17.8 81.4

SCH, RRC and EACH ............................................................................................... 57 7.0 33.3 59.6

Type of Ownership:

Voluntary ................................................................................................................... 2,912 3.1 34.9 62.1

Proprietary ................................................................................................................. 684 8.2 60.4 31.4

Government ............................................................................................................... 1,344 1.8 22.8 75.4

Medicare Utilization as a Percent of Inpatient Days:

0–25 ........................................................................................................................... 254 3.5 33.5 63.0

25–50 ......................................................................................................................... 1,300 4.4 42.3 53.3

50–65 ......................................................................................................................... 1,982 3.3 35.3 61.5

Over 65 ...................................................................................................................... 1,404 2.8 28.5 68.7

As we explain in Appendix B, we

were not able to determine a hospitalspecific rate for 73 of the 5,088 hospitals

in our database. Consequently, the

payment methodology distribution is

based on 5,015 hospitals. These data

should be fully representative of the

payment methodologies that will be

applicable to hospitals.

The cross-sectional distribution of

hospital by payment methodology is

presented by: (1) Geographic location,

(2) region, and (3) payment

classification. This provides an

indication of the percentage of hospitals

within a particular hospital grouping

that will be paid under the fully

prospective payment methodology and

under the hold-harmless methodology.

The percentage of hospitals paid fully

Federal (100 percent of the Federal rate)

as hold-harmless hospitals is expected

to increase to 35.2 percent in FY 1998.

Table IV indicates that 61.4 percent of

hospitals will be paid under the fully

prospective payment methodology.

(This figure, unlike the figure of 66

percent for low cost capital hospitals in

the previous section, takes account of

the effects of redeterminations. In other

words, this figure does not include low

cost hospitals that, following a hospitalspecific rate redetermination, are now

paid under the hold-harmless

methodology.) As expected, a relatively

higher percentage of rural and

governmental hospitals (72.0 percent

and 75.4 percent, respectively by

payment classification) are being paid

under the fully prospective

methodology. This is a reflection of

their lower than average capital costs
Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations 46133

per case. In contrast, only 31.4 percent

of proprietary hospitals are being paid

under the fully prospective

methodology. This is a reflection of

their higher than average capital costs

per case. (We found at the time of the

August 30, 1991 final rule (56 FR 43430)

that 62.7 percent of proprietary

hospitals had a capital cost per case

above the national average cost per

case.)

D. Cross-Sectional Analysis of Changes

in Aggregate Payments

We used our FY 1998 actuarial model

to estimate the potential impact of

changes for FY 1998 on total capital

payments per case, using a universe of

5,015 hospitals. The individual hospital

payment parameters are taken from the

best available data, including: The July

1, 1997 update to the provider-specific

file, cost report data, and audit

information supplied by intermediaries.

Table V presents estimates of payments

per case under our model for FY 1997

(column 2). For FY 1998, we present

estimates of payments per case both

before and after the effects of the 17.78

percent reduction to the standard

Federal and hospital-specific rates.

Column 5 shows the total percentage

change in payments from FY 1997 to FY

1998 (after the effects of the Balanced

Budget Act of 1997). Column 6 presents

the percentage change that can be

attributed to the Balanced Budget Act of

1997 (the 17.78 percent reduction).

Column 7 presents the percentage

change in payments that can be

attributed to Federal rate changes.

Federal rate changes represented in

Column 7 include the 15.36 percent

decrease in the Federal rate which

includes the Balanced Budget Act

reduction, a 1.0 percent increase in case

mix, changes in the adjustments to the

Federal rate (for example, the effect of

the new hospital wage index on the

geographic adjustment factor), and

reclassifications by the MGCRB. Column

5 includes the effects of the Federal rate

changes represented in column 7.

Column 5 also reflects the effects of all

other changes, including: the change

from 60 percent to 70 percent in the

portion of the Federal rate for fully

prospective hospitals, the hospitalspecific rate update, changes in the

proportion of new to total capital for

hold-harmless hospitals, changes in old

capital (for example, obligated capital

put in use), hospital-specific rate

redeterminations, and exceptions. The

comparisons are provided by: (1)

Geographic location, (2) region, and (3)

payment classification.

The simulation results show that, on

average, capital payments per case can

be expected to decrease 8.9 percent in

FY 1998. The results show that the

effect of the Balanced Budget Act of

1997 is to decrease payments by 17.5

percent. The results show that the effect

of the Federal rate changes is to

decrease payments by 11.0 percent.

(This figure includes the effects of the

Balanced Budget Act of 1997, but also

includes the other payment adjustments

which offset the magnitude of the 17.78

percent reduction.) In addition to the

11.0 percent decrease attributable to the

Federal rate changes, a 2.1 percent

increase is attributable to the effects of

all other changes.

Our comparison by geographic

location shows that capital payments

per case to urban and rural hospitals

experience similar rates of decrease (8.8

percent and 9.9 percent, respectively).

Payments per case for urban hospitals

will decrease at about the same rate as

payments per case for rural hospitals

(11.0 percent and 11.4 percent,

respectively) from the Federal rate

changes alone. Urban hospitals will gain

approximately the same as rural

hospitals (2.2 percent and 1.5 percent,

respectively) from the effects of all other

changes.

By region, there are variations in the

change in payments per case. All

regions are estimated to receive

decreases in total capital payments per

case, due to the reduction to the rate

and due to the increased share of

payments that are based on the Federal

rate (from 60 to 70 percent). Changes by

region vary from the smallest decrease

of 5.1 percent (rural New England

region) to the largest decrease of 11.4

percent (urban Puerto Rico hospitals).

Overall, Puerto Rico hospitals are

affected less by the change to the

Federal rate and by the rate reduction

due to the Balanced Budget Act of 1997

than other hospitals are nationally.

Puerto Rico hospitals are projected to

experience a slightly larger decrease in

overall payments per case than other

regions due to the other factors. We

project a reduction in exceptions

payments to Puerto Rico hospitals

relative to the rest of the nation, which

means that Puerto Rico hospitals are

receiving a greater share of their capital

costs as part of their regular payments.

We also project a decrease in holdharmless payments which is greater

than the national average.

By type of ownership, proprietary

hospitals are projected to have the

largest rate of decrease (11.0 percent,

11.8 percent due to Federal rate changes

and a positive increase of 0.8 percent

from the effects of all other changes).

Payments to voluntary hospitals will

decrease 8.8 percent (an 11.0 percent

decrease due to Federal rate changes

and a 2.2 percent increase from the

effects of all other changes) and

payments to government hospitals will

decrease 7.6 percent (a 10.3 percent

decrease due to Federal rate changes

and a 2.7 percent increase from the

effects of all other changes).

Section 1886(d)(10) of the Act

established the MGCRB. Hospitals may

apply for reclassification for purposes of

the standardized amount, wage index,

or both. Although the Federal capital

rate is not affected, a hospital’s

geographic classification for purposes of

the operating standardized amount does

affect a hospital’s capital payments as a

result of the large urban adjustment

factor and the disproportionate share

adjustment for urban hospitals with 100

or more beds. Reclassification for wage

index purposes affects the geographic

adjustment factor since that factor is

constructed from the hospital wage

index.

To present the effects of the hospitals

being reclassified for FY 1998 compared

to the effects of reclassification for FY

1997, we show the average payment

percentage increase for hospitals

reclassified in each fiscal year and in

total. For FY 1998 reclassifications, we

indicate those hospitals reclassified for

standardized amount purposes only, for

wage index purposes only, and for both

purposes. The reclassified groups are

compared to all other nonreclassified

hospitals. These categories are further

identified by urban and rural

designation.

Hospitals reclassified for FY 1998 as

a whole are projected to experience a

9.2 percent decrease in payments (a 10.9

percent decrease attributable to Federal

rate changes and a 1.7 percent increase

attributable to the effects of all other

changes). Payments to nonreclassified

hospitals will decrease slightly less (8.7

percent) than reclassified hospitals (9.2

percent) overall. Payments to

nonreclassified hospitals will decrease

slightly less than reclassified hospitals

from the Federal rate changes (10.8

percent compared to 10.9 percent), but

they will gain slightly more from the

effects of all other changes (2.1 percent

compared to 1.7 percent).
46134 Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations

TABLE V.—COMPARISON OF TOTAL PAYMENTS PER CASE

[FY 1997 Payments Compared To FY 1998 Payments]

Number of

hospitals

Average FY

1997 payments/case

Average FY

1998 payments/case

before Balanced

Budget Act

of 1997

Average FY

1998 payments/case

after Balanced

Budget Act

of 1997

All changes

Change due

to Balanced

Budget Act

of 1997

Portion attributable to

Federal rate

change

By Geographic Location:

All hospitals ........................................ 5,015 673 743 613 ¥8.9 ¥17.5 ¥11.0

Large urban areas (populations over

1 million) ......................................... 1,590 770 851 703 ¥8.7 ¥17.4 ¥10.9

Other urban areas (populations of 1

million or fewer) .............................. 1,209 664 733 605 ¥8.9 ¥17.5 ¥11.1

Rural areas ........................................ 2,216 461 507 416 ¥9.9 ¥18.0 ¥11.4

Urban hospitals .................................. 2,799 725 801 661 ¥8.8 ¥17.4 ¥11.0

0–99 beds ................................... 674 540 588 485 ¥10.1 ¥17.5 ¥11.6

100–199 beds ............................. 946 649 710 585 ¥9.8 ¥17.5 ¥11.5

200–299 beds ............................. 569 700 771 633 ¥9.6 ¥17.9 ¥11.4

300–499 beds ............................. 457 756 840 693 ¥8.2 ¥17.4 ¥10.9

500 or more beds ....................... 153 883 985 820 ¥7.2 ¥16.8 ¥9.7

Rural hospitals ................................... 2,216 461 507 416 ¥9.9 ¥18.0 ¥11.4

0–49 beds ................................... 1,158 367 403 333 ¥9.3 ¥17.5 ¥11.1

50–99 beds ................................. 655 433 474 390 ¥9.9 ¥17.7 ¥11.3

100–149 beds ............................. 235 480 531 434 ¥9.7 ¥18.4 ¥11.9

150–199 beds ............................. 93 499 548 452 ¥9.5 ¥17.6 ¥10.7

200 or more beds ....................... 75 581 637 518 ¥10.7 ¥18.7 ¥12.0

By Region:

Urban by Region ................................ 2,799 725 801 661 ¥8.8 ¥17.4 ¥11.0

New England .............................. 158 735 815 673 ¥8.5 ¥17.4 ¥11.3

Middle Atlantic ............................ 426 769 849 698 ¥9.3 ¥17.8 ¥11.1

South Atlantic .............................. 414 719 791 657 ¥8.6 ¥17.0 ¥11.3

East North Central ...................... 471 686 760 625 ¥8.9 ¥17.8 ¥10.6

East South Central ..................... 159 668 746 620 ¥7.1 ¥16.9 ¥10.0

West North Central ..................... 188 709 785 650 ¥8.3 ¥17.3 ¥10.6

West South Central .................... 344 734 806 668 ¥9.0 ¥17.1 ¥10.8

Mountain ..................................... 124 742 811 668 ¥9.9 ¥17.6 ¥11.3

Pacific ......................................... 467 790 877 723 ¥8.5 ¥17.5 ¥11.2

Puerto Rico ................................. 48 300 319 266 ¥11.4 ¥16.7 ¥10.6

Rural by Region ................................. 2,216 461 507 416 ¥9.9 ¥18.0 ¥11.4

New England .............................. 53 531 596 504 ¥5.1 ¥15.5 ¥11.1

Middle Atlantic ............................ 84 477 518 425 ¥10.9 ¥17.9 ¥12.0

South Atlantic .............................. 293 496 541 448 ¥9.7 ¥17.2 ¥11.8

East North Central ...................... 301 458 505 414 ¥9.8 ¥18.0 ¥11.4

East South Central ..................... 273 425 471 381 ¥10.4 ¥19.2 ¥11.8

West North Central ..................... 511 439 480 395 ¥10.0 ¥17.7 ¥10.6

West South Central .................... 345 425 467 379 ¥10.9 ¥18.9 ¥11.8

Mountain ..................................... 211 486 533 437 ¥9.9 ¥17.9 ¥10.4

Pacific ......................................... 140 523 584 479 ¥8.4 ¥17.9 ¥11.1

By Payment Classification:

All hospitals ........................................ 5,015 673 743 613 ¥8.9 ¥17.5 ¥11.0

Large urban areas (populations over

1 million) ......................................... 1,735 760 840 693 ¥8.7 ¥17.5 ¥10.9

Other urban areas (populations of 1

million or fewer) .............................. 1,153 663 732 605 ¥8.8 ¥17.4 ¥11.1

Rural areas ........................................ 2,127 456 500 411 ¥10.0 ¥17.9 ¥11.5

Teaching Status:

Non-teaching ............................... 3,922 582 638 523 ¥10.1 ¥18.0 ¥11.7

Fewer than 100 Residents ......... 855 711 787 648 ¥8.8 ¥17.6 ¥10.9

100 or more Residents ............... 238 961 1,075 902 ¥6.2 ¥16.2 ¥9.4

Urban DSH:

100 or more beds ................ 1,408 764 844 701 ¥8.2 ¥16.9 ¥10.6

Less than 100 beds ............. 81 528 583 477 ¥9.7 ¥18.2 ¥11.3

Rural DSH:

Sole Community (SCH/

EACH) .............................. 154 412 448 381 ¥7.5 ¥15.0 ¥10.6

Referral Center (RRC/

EACH) .............................. 50 534 587 485 ¥9.2 ¥17.4 ¥11.2

Other Rural:

100 or more beds ......... 66 438 478 389 ¥11.3 ¥18.6 ¥12.3

Less than 100 beds ...... 127 367 405 327 ¥11.1 ¥19.3 ¥11.6

Urban teaching and DSH:

Both teaching and DSH .............. 707 830 919 767 ¥7.5 ¥16.5 ¥10.1
Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations 46135

TABLE V.—COMPARISON OF TOTAL PAYMENTS PER CASE—Continued

[FY 1997 Payments Compared To FY 1998 Payments]

Number of

hospitals

Average FY

1997 payments/case

Average FY

1998 payments/case

before Balanced

Budget Act

of 1997

Average FY

1998 payments/case

after Balanced

Budget Act

of 1997

All changes

Change due

to Balanced

Budget Act

of 1997

Portion attributable to

Federal rate

change

Teaching and no DSH ................ 329 720 805 659 ¥8.5 ¥18.2 ¥10.9

No teaching and DSH ................. 782 657 722 594 ¥9.6 ¥17.7 ¥11.5

No teaching and no DSH ........... 1,070 628 688 562 ¥10.5 ¥18.4 ¥12.1

Rural Hospital Types:

Non special status hospitals ....... 905 412 452 366 ¥11.1 ¥19.0 ¥12.0

RRC/EACH ................................. 158 541 596 481 ¥11.1 ¥19.3 ¥11.7

SCH/EACH ................................. 641 444 484 407 ¥8.4 ¥15.9 ¥11.0

Medicare-dependent hospitals

(MDH) ...................................... 366 367 408 337 ¥8.4 ¥17.6 ¥11.3

SCH, RRC and EACH ................ 57 537 581 493 ¥8.1 ¥15.0 ¥10.4

Hospitals Reclassified by the Medicare Geographic Classification Review Board:

Reclassification Status During

FY97 and FY98:

Reclassified During Both

FY97 and FY98 ................ 333 631 705 569 ¥9.8 ¥19.2 ¥11.6

Reclassified During FY98

Only .................................. 89 544 629 515 ¥5.4 ¥18.2 ¥6.8

Reclassified During FY97

Only .................................. 178 615 654 529 ¥13.9 ¥19.1 ¥14.4

FY98 Reclassifications:

All Reclassified Hospitals .... 422 618 693 561 ¥9.2 ¥19.1 ¥10.9

All Nonreclassified Hospitals 4,511 679 750 620 ¥8.7 ¥17.3 ¥10.8

All Urban Reclassified Hospitals ................................. 109 718 804 648 ¥9.8 ¥19.4 ¥11.3

Urban Nonreclassified Hospitals ................................. 2,690 725 801 662 ¥8.7 ¥17.3 ¥10.9

All Reclassified Rural Hospitals ................................. 313 545 613 498 ¥8.8 ¥18.8 ¥10.6

Rural Nonreclassified Hospitals ................................. 1,876 430 467 385 ¥10.3 ¥17.5 ¥11.8

Other Reclassified Hospitals (Section

1886(D)(8)(B)) ................................ 27 508 564 449 ¥11.7 ¥20.5 ¥11.6

Type of Ownership:

Voluntary ..................................... 2,912 688 760 628 ¥8.8 ¥17.5 ¥11.0

Proprietary .................................. 684 676 738 602 ¥11.0 ¥18.5 ¥11.8

Government ................................ 1,344 590 656 545 ¥7.6 ¥17.0 ¥10.3

Medicare Utilization as a Percent of

Inpatient Days:

0–25 ............................................ 254 756 845 709 ¥6.2 ¥16.1 ¥10.6

25–50 .......................................... 1,300 792 876 727 ¥8.3 ¥17.0 ¥10.4

50–65 .......................................... 1,982 628 694 570 ¥9.3 ¥17.8 ¥11.3

Over 65 ....................................... 1,404 560 616 503 ¥10.2 ¥18.2 ¥12.0

Appendix B: Technical Appendix on

the New Capital Cost Model and

Required Adjustments

Under section 1886(g)(1)(A) of the

Act, we set capital prospective payment

rates for FY 1992 through FY 1995 so

that aggregate prospective payments for

capital costs were projected to be 10

percent lower than the amount that

would have been payable on a

reasonable cost basis for capital-related

costs in that year. To implement this

requirement, we developed the capital

acquisition model to determine the

budget neutrality adjustment factor.

Even though the budget neutrality

requirement expired effective with FY

1996, we must continue to determine

the recalibration and geographic

reclassification budget neutrality

adjustment factor, and the reduction in

the Federal and hospital-specific rates

for exceptions payments. To determine

these factors, we must continue to

project capital costs and payments.

We have used the capital acquisition

model since the start of prospective

payments for capital costs. We now

have 4 years of cost reports under the

capital prospective payment system.

Consequently, we have developed a new

capital cost model to replace the capital

acquisition model. This new model

makes use of the data from these cost

reports.

The following cost reports are used in

the capital cost model for this final rule:

the June 13, 1997 update of the cost

reports for PPS–IX (cost reporting

periods beginning in FY 1992), PPS–X

(cost reporting periods beginning in FY

1993), PPS–XI (cost reporting periods

beginning in FY 1994), and PPS–XII

(cost reporting periods beginning in FY

1995). In addition, to model payments,

we use the July 1, 1997 update of the

provider-specific file, and the March
46136 Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations

1994 update of the intermediary audit

file.

Since hospitals under alternative

payment system waivers (that is,

hospitals in Maryland) are currently

excluded from the capital prospective

payment system, we excluded these

hospitals from our model.

We developed FY 1992 through FY

1997 hospital-specific rates using the

provider-specific file and the

intermediary audit file. (We used the

cumulative provider-specific file, which

includes all updates to each hospital’s

records, and chose the latest record for

each fiscal year.) We checked the

consistency between the providerspecific file and the intermediary audit

file. We ensured that increases in the

hospital-specific rates were at least as

large as the published updates

(increases) for the hospital-specific rates

each year. We were able to match

hospitals to the files as shown in the

following table:

Source Number of

hospitals

Provider-Specific File Only ....... 117

Provider-Specific and Audit File 4971

Total ............................... 5088

Ninety-seven of the 5,088 hospitals

had unusable or missing data or had no

cost reports available. We determined

from the cost reports that 24 of the 97

hospitals were paid under the holdharmless methodology. Since the

hospital-specific amount is not used to

determine payments for these hospitals,

we were able to include these 24

hospitals in the analysis. Seventy-three

hospitals could not be used in the

analysis because of insufficient

information. They account for about 0.2

percent of admissions so any effect

should be minimal. Therefore, we used

data from cost reports from 5,015

hospitals for the analysis.

We analyzed changes in capitalrelated costs (depreciation, interest,

rent, leases, insurance, and taxes)

reported in the cost reports. We found

a wide variance among hospitals in the

growth of these costs. For hospitals with

more than 100 beds, the distribution

and mean of these cost increases were

different for large (greater than ±20

percent) changes in bed-size. We also

analyzed changes in the growth in old

capital and new capital for cost reports

that provided this information. For old

capital, we limited the analysis only for

decreases in old capital. We did this

since the opportunity for most hospitals

to treat ‘‘obligated’’ capital put into

service as old capital has expired. Old

capital costs should, therefore, decrease

as assets become fully depreciated, and

as interest costs decrease as the loan is

amortized.

The new capital cost model separates

the hospitals into three mutually

exclusive groups. Hold-harmless

hospitals with data on old capital were

placed in the first group. Of the

remaining hospitals, those hospitals

with fewer than 100 beds comprise the

second group. The third group consists

of all hospitals that did not fit into

either of the first two groups. Each of

these groups displayed unique patterns

of growth in capital costs. We found that

the gamma distribution is useful in

explaining and describing the patterns

of increase in capital costs. A gamma

distribution is a statistical distribution

that can be used to describe patterns of

growth rates, with greatest proportion of

rates being at the low end. We use the

gamma distribution to estimate

individual hospital rates of increase.

(1) For hold-harmless hospitals, old

capital cost changes were fitted to a

truncated gamma distribution, that is, a

gamma distribution covering only the

distribution of cost decreases. New

capital costs changes were fitted to the

entire gamma distribution allowing for

both decreases and increases.

(2) For hospitals with fewer than 100

beds (small), total capital cost changes

were fitted to the gamma distribution

allowing for both decreases and

increases.

(3) Other (large) hospitals were further

separated into three groups:

• Bed-size decreases over 20 percent

(decrease)

• Bed-size increases over 20 percent

(increase)

• Other (no-change).

Capital cost changes for large

hospitals were fitted to gamma

distributions for each bed-size change

group, allowing for both decreases and

increases in capital costs. We analyzed

the probability distribution of increases

and decreases in bed-size for large

hospitals. We found the probability

somewhat dependent on the prior year

change in bed-size and factored this

dependence into the analysis.

Probabilities of bed-size change were

determined. Separate sets of probability

factors were calculated to reflect the

dependence on prior year change in

bed-size (increase, decrease, and no

change).

The gamma distributions were fitted

to changes in aggregate capital costs for

the entire hospital. We checked the

relationship between aggregate costs

and Medicare per discharge costs. For

large hospitals, there was a small

variance, but the variance was larger for

small hospitals. Since costs are used

only for the hold-harmless methodology

and to determine exceptions, we

decided to use the gamma distributions

fitted to aggregate cost increases for

estimating distributions of cost per

discharge increases.

Capital costs per discharge calculated

from the cost reports were increased by

random numbers drawn from the

gamma distribution to project costs in

future years. Old and new capital were

projected separately for hold-harmless

hospitals. Aggregate capital per

discharge costs were projected for all

other hospitals. Because the distribution

of increases in capital costs varies with

changes in bed-size for large hospitals,

we first projected changes in bed-size

for large hospitals before drawing

random numbers from the gamma

distribution. Bed-size changes were

drawn from the uniform distribution

with the probabilities dependent on the

previous year bed-size change. The

gamma distribution has a shape

parameter and a scaling parameter. (We

used different parameters for each

hospital group, and for old and new

capital.)

We used discharge counts from the

cost reports to calculate capital cost per

discharge. To estimate total capital costs

for FY 1996 (the MEDPAR data year)

and later, we use the number of

discharges from the MEDPAR data.

Some hospitals have considerably more

discharges in FY 1996 than in the years

for which we calculated cost per

discharge from the cost report data.

Consequently, a hospital with few cost

report discharges would have a high

capital cost per discharge since fixed

costs would be allocated over only a few

discharges. If discharges increase

substantially, the cost per discharge

would decrease because fixed costs

would be allocated over many

discharges. If the projection of capital

cost per discharge is not adjusted for

increases in discharges, the projection of

exceptions would be overstated. We

correct this situation by recalculating

the cost per discharge with the

MEDPAR discharges if the MEDPAR

discharges exceed the cost report

discharges by more than 20 percent. We

do not adjust for increases of less than

20 percent because we have not

received every FY 1996 discharge, and

because some discharges are removed

from the analysis because they are

statistical outliers. This adjustment

reduces our estimate of exceptions

payments, and consequently, the

reduction to the Federal Rate for

exceptions is smaller. We will continue

to monitor our modeling of exceptions

payments and make adjustments as

needed.
Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations 46137

The average national capital cost per

discharge generated by this model is the

combined average of many randomly

generated increases. This average must

equal the projected average national

capital cost per discharge, which we

projected separately (outside this

model). We adjusted the shape

parameter of the gamma distributions so

that the modeled average capital cost

per discharge matches our projected

capital cost per discharge. The shape

parameter for old capital was not

adjusted since we are modeling the

aging of ‘‘existing’’ assets. This model

provides a distribution of capital costs

among hospitals that are consistent with

our aggregate capital projections.

Once each hospital’s capital-related

costs are generated, the model projects

capital payments. We use the actual

payment parameters (for example, the

case-mix index and the geographic

adjustment factor) that are applicable to

the specific hospital.

To project capital payments, the

model first assigns the applicable

payment methodology (fully prospective

or hold-harmless) to the hospital as

determined from the provider-specific

file and the cost reports. The model

simulates Federal rate payments using

the assigned payment parameters and

hospital-specific estimated outlier

payments. The case-mix index for a

hospital is derived from the FY 1996

MedPAR file using the FY 1998 DRG

relative weights published in section V.

of the Addendum of this final rule. The

case-mix index is increased each year

after FY 1996 based on analysis of past

experiences in case-mix increases.

Based on analysis of recent case-mix

increases, we estimate that case-mix

will increase 0.5 percent in FY 1997 and

1.0 percent in FY 1998. (Since we are

using FY 1996 cases for our analysis, the

FY 1996 increase in case mix has no

effect on projected capital payments.)

Changes in geographic classification

and revisions to the hospital wage data

used to establish the hospital wage

index affect the geographic adjustment

factor. Changes in the DRG classification

system and the relative weights affect

the case-mix index.

Section 412.308(c)(4)(ii) requires that

the estimated aggregate payments for the

fiscal year, based on the Federal rate

after any changes resulting from DRG

reclassifications and recalibration and

the geographic adjustment factor, equal

the estimated aggregate payments based

on the Federal rate that would have

been made without such changes. For

FY 1997, the budget neutrality

adjustment factor was 1.00123. To

determine the factor for FY 1998, we

first determined the portion of the

Federal rate that would be paid for each

hospital in FY 1998 based on its

applicable payment methodology. Using

our model, we then compared estimated

aggregate Federal rate payments based

on the FY 1997 DRG relative weights

and the FY 1997 geographic adjustment

factor to estimated aggregate Federal

rate payments based on the FY 1998

relative weights and the FY 1998

geographic adjustment factor. In making

the comparison, we held the FY 1998

Federal rate portion constant and set the

other budget neutrality adjustment

factor and the exceptions reduction

factor to 1.00. We determined that, to

achieve budget neutrality for the

changes in the geographic adjustment

factor and DRG classifications and

relative weights, an incremental budget

neutrality adjustment of 0.99892 for FY

1998 should be applied to the previous

cumulative FY 1997 adjustment of

1.00123, yielding a cumulative

adjustment of 1.00015 through FY 1998.

The following table summarizes the

adjustment factors for each fiscal year:

BUDGET NEUTRALITY ADJUSTMENT FOR

DRG RECLASSIFICATIONS AND RECALIBRATION AND THE GEOGRAPHIC

ADJUSTMENT FACTOR

Fiscal year

Incremental

adjustment

Cumulative

adjustment

1992 .............................. .............. 1.00000

1993 .............................. 0.99800 0.99800

1994 .............................. 1.00531 1.00330

1995 .............................. 0.99980 1.00310

1996 .............................. 0.99940 1.00250

1997 .............................. 0.99873 1.00123

1998 .............................. 0.99892 1.00015

The methodology used to determine

the recalibration and geographic (DRG/

GAF) budget neutrality adjustment

factor is similar to that used in

establishing budget neutrality

adjustments under the prospective

payment system for operating costs. One

difference is that, under the operating

prospective payment system, the budget

neutrality adjustments for the effect of

geographic reclassifications are

determined separately from the effects

of other changes in the hospital wage

index and the DRG relative weights.

Under the capital prospective payment

system, there is a single DRG/GAF

budget neutrality adjustment factor for

changes in the geographic adjustment

factor (including geographic

reclassification) and the DRG relative

weights. In addition, there is no

adjustment for the effects that

geographic reclassification has on the

other payment parameters, such as the

payments for serving low-income

patients or the large urban add-on

payments.

In addition to computing the DRG/

GAF budget neutrality adjustment

factor, we used the model to simulate

total payments under the prospective

payment system.

Additional payments under the

exceptions process are accounted for

through a reduction in the Federal and

hospital-specific rates. Therefore, we

used the model to calculate the

exceptions reduction factor. This

exceptions reduction factor ensures that

aggregate payments under the capital

prospective payment system, including

exceptions payments, are projected to

equal the aggregate payments that

would have been made under the

capital prospective payment system

without an exceptions process. Since

changes in the level of the payment

rates change the level of payments

under the exceptions process, the

exceptions reduction factor must be

determined through iteration.

In the August 30, 1991 final rule (56

FR 43517), we indicated that we would

publish each year the estimated

payment factors generated by the model

to determine payments for the next 5

years. The table below provides the

actual factors for fiscal years 1992

through 1998, and the estimated factors

that would be applicable through FY

2002. We caution that these are

estimates for fiscal years 1999 and later,

and are subject to revisions resulting

from continued methodological

refinements, more recent data, and any

payment policy changes that may occur.

In this regard, we note that in making

these projections we have assumed that

the cumulative DRG/GAF budget

neutrality adjustment factor will remain

at 1.00015 for FY 1998 and later because

we do not have sufficient information to

estimate the change that will occur in

the factor for years after FY 1998.

The projections are as follows:
46138 Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations

Fiscal year Update

factor

Exceptions reduction

factor

Budget

neutrality

factor

DRG/

GAF adjustment

factor 1

Outlier

adjustment factor

Federal

rate adjustment

Federal

rate (after

outlier)

reduction)

1992 ...................................................................................... N/A 0.9813 0.9602 ................ .9497 ................ 415.59

1993 ...................................................................................... 6.07 .9756 .9162 .9980 .9496 ................ 417.29

1994 ...................................................................................... 3.04 .9485 .8947 1.0053 .9454 2.9260 378.34

1995 ...................................................................................... 3.44 .9734 .8432 .9998 .9414 ................ 376.83

1996 ...................................................................................... 1.20 .9849 N/A .9994 .9536 3.9972 461.96

1997 ...................................................................................... 0.70 .9358 N/A .9987 .9481 ................ 438.92

1998 ...................................................................................... 0.90 .9659 N/A .9989 .9382 4.8222 371.51

1999 ...................................................................................... 1.20 .9518 N/A 5 1.0000 5.9382 ................ 370.48

2000 ...................................................................................... 1.20 .9409 N/A 1.0000 .9382 ................ 370.63

2001 ...................................................................................... 1.30 .9324 N/A 1.0000 .9382 ................ 372.06

2002 ...................................................................................... 1.30 6 1.0000 N/A 1.0000 .9382 ................ 404.22

1 Note: The incremental change over the previous year.

2 Note: OBRA 1993 adjustment.

3 Note: Adjustment for change in the transfer policy.

4 Note: Balanced Budget Act of 1997 adjustment.

5 Note: Future adjustments are, for purposes of this projection, assumed to remain at the same level.

6 Note: We are unable to estimate exceptions payments for the year under the special exceptions provision (§ 412.348(g) of the regulations)

because the regular exceptions provision (§ 412.348(e)) expires.

Appendix C: Revised Hospital Market

Basket Data Sources

I. Introduction: Market Basket Relative

Weights and Choice of Price Proxy

Variables for the Operating Hospital

Input Price Indexes

In the August 30, 1996 final rule (61

FR 46323), we discussed in detail the

current 1992-based hospital market

baskets, and noted that we would revise

the hospital market baskets when new

cost data for 1992 became available.

This appendix describes the technical

features of the revisions to the 1992-

based indexes that we set forth in this

final rule with comment period in

section IV of the preamble. For both the

prospective payment and excluded

hospital market baskets, the differences

between the revised market basket and

the current market basket are noted.

We present this description of the

hospital operating market baskets in

three steps:

• A synopsis of the differences

between the current 1992-based market

baskets and the revisions to those

market baskets.

• A description of the methodology

used to develop the cost category

weights in the revised market baskets,

making note of the differences from the

methodology used to develop the 1992-

based current market baskets.

• A description of the data sources

used to measure price change for each

component of the revised market

baskets, making note of the differences

from the price proxies used in the 1992-

based current hospital market baskets.

II. Synopsis of Differences

Two major differences exist between

the 1992-based current hospital market

baskets and the hospital market baskets.

The first major change is that the

revised hospital market baskets are

based on additional hospital

expenditure data—data not available

until after the publication of the August

30, 1996 final rule. The 1992-based

current market baskets were derived

from hospital cost reports for cost

reporting periods beginning on or after

October 1, 1991 and before October 1,

1992, augmented by information from

the latest available (1987) Input-Output

Table for the hospital industry,

produced by the Bureau of Economic

Analysis, U.S. Department of

Commerce. In addition to the data

sources cited above, the revised hospital

market baskets use data from the 1992

Asset and Expenditure Survey,

produced by the U.S. Department of

Commerce, Economic and Statistics

Administration, Bureau of the Census.

These are more recent data made

available after the publication of the

August 30, 1996 final rule.

The second major difference is that

some cost categories have been

combined with other cost categories to

better reflect the new data sources.

Specifically, the Transportation Services

category has been combined with All

Other Nonlabor-Intensive Services;

Business Services and Computer and

Data Processing Services with All Other

Labor-Intensive Services; and part of

Fuel Oil, Coal, etc. was combined with

Natural Gas into Fuels, Nonhighway.

The remainder of the Fuel Oil, Coal, etc.

was combined with Miscellaneous

Products. These category mergers reflect

the Bureau of the Census categories in

the Asset and Expenditure Survey and

its information on services.

III. Methodology for Developing the

Revised Cost Category Weights

Cost category weights for the revised

market baskets were developed in three

stages. First, base weights for the six

main categories (Wages and Salaries,

Employee Benefits, Pharmaceuticals,

Nonmedical Professional Fees,

Professional Liability Insurance, and All

Other Expenses) were obtained from the

1992-based hospital market baskets. As

the base year is not changing, these

weights, developed last year from

HCRIS data and the American Hospital

Association (AHA) Annual Survey

information, will not change. The

weight for All Other Expenses was

divided into subcategories using cost

shares from the 1992 Asset and

Expenditure Survey for Hospitals, U.S.

Department of Commerce, Economics

and Statistics Administration, Bureau of

the Census. These subcategories were

further divided using cost shares from

the 1987 Input-Output Table for the

hospital industry, produced by the U.S.

Department of Commerce, Bureau of

Economic Analysis (BEA), aged to 1992

using price changes.

A description of the source of the six

main category weights is found in the

August 30, 1996 final rule (61 FR

46323). The weight for the Utilities

category, as well as those for the

Electricity, Fuels Nonhighway, and

Water and Sewerage Maintenance cost

categories, was derived from the 1992

Asset and Expenditure Survey. The All

Other Goods and Services category has

more subcategories than any other

market basket category. Goods found in

this category include: direct service

food, contract service food,

pharmaceuticals, chemicals, medical

instruments, photo supplies, rubber and

plastics, paper products, apparel,
Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations 46139

machinery and equipment and

miscellaneous products. Services found

in this category include telephone

services, postage, other labor-intensive

services, and other nonlabor-intensive

services. The share for pharmaceuticals

was derived from the 1992 Medicare

cost reports. Relative shares for the

other subcategories were derived from

the 1992 Asset and Expenditure Survey,

augmented by data from the 1987 InputOutput Table produced by BEA for the

hospital industry, aged forward to 1992

using price changes, and then

standardized to be consistent with data

from the Asset and Expenditure Survey.

IV. Price Proxies Used to Measure Cost

Category Growth

Descriptions of the price proxies used

to measure cost category price growth in

the current hospital market baskets are

found in the August 30, 1996 final rule

(61 FR 46324). The price proxies used

for the revised hospital market baskets

are the same as those for the current

market baskets. Four cost categories in

the current hospital market baskets have

been combined with other cost

categories to better reflect new data

sources.

For further discussion of the rationale

for choosing specific price proxies, we

refer the reader to the September 3, 1986

final rule (51 FR 31582).

Appendix D: Recommendation of

Update Factors for Operating Cost

Rates of Payment for Inpatient Hospital

Services

I. Background

Several provisions of the Act address

the setting of update factors for

inpatient services furnished in FY 1998

by hospitals subject to the prospective

payment system and those excluded

from the prospective payment system.

Section 1886(b)(3)(B)(i)(XIII) of the Act,

as amended by section 4401(a)(2) of

Pub. L. 105–33, sets the percentage

change in the operating cost

standardized amounts equal to 0 percent

for FY 1998. Section 1886(b)(3)(B)(iv) of

the Act sets the FY 1998 percentage

increase in the hospital-specific rates

applicable to sole community and

Medicare-dependent, small rural

hospitals equal to the rate set forth in

section 1886(b)(3)(B)(i) of the Act, that

is, the same update factor as all other

hospitals subject to the prospective

payment system, or 0 percent. (As

discussed in section V.D. of this

preamble, section 4401(b) of Pub. L.

105–33 provides for an increase in the

operating cost standardized amounts of

0.5 percentage points for certain

hospitals that do not receive

disproportionate share or indirect

medical education payments and are not

designated as Medicare-dependent,

small rural hospitals.) Section

1886(b)(3)(B)(ii) of the Act, as amended

by section 4411(a) of Pub. L 105–33, sets

the FY 1998 percentage increase in the

rate-of-increase limits for hospitals

excluded from the prospective payment

system equal to 0 percent. Therefore, in

accordance with section 1886(d)(3)(A)

of the Act, we are updating the

standardized amounts, the hospitalspecific rates, and the rate-of-increase

limits for hospitals excluded from the

prospective payment system by 0

percent.

Sections 1886(e) (2)(A) and (3)(A) of

the Act require that the Prospective

Payment Assessment Commission

(ProPAC) recommend to the Congress by

March 1, 1997 an update factor that

takes into account changes in the market

basket rate of increase index, hospital

productivity, technological and

scientific advances, the quality of health

care provided in hospitals, and longterm cost effectiveness in the provision

of inpatient hospital services. In

Recommendation 2 of its March 1, 1997

report, ProPAC recommended update

factors to the standardized amounts

equal to 0 percentage points for

hospitals in both large urban and other

areas. ProPAC did not make a separate

recommendation for the hospitalspecific rates applicable to sole

community and Medicare-dependent,

small rural hospitals.

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

that the Secretary, taking into

consideration the recommendations of

ProPAC, recommend update factors for

each fiscal year that take into account

the amounts necessary for the efficient

and effective delivery of medically

appropriate and necessary care of high

quality. As required by section

1886(e)(5) of the Act, we published the

FY 1998 update factors recommended

under section 1886(e)(4) of the Act as

Appendix E of the June 2, 1997

proposed rule (62 FR 30034).

II. Secretary’s Final Recommendations

for Updating the Prospective Payment

System Standardized Amounts

We received several public comments

concerning our proposed

recommendation. After consideration of

the arguments presented, we have

decided that our final recommendation

will be the same as our proposed

recommendation. That is, we are

recommending an update of 0

percentage points for hospitals located

in large urban and other areas. We are

also recommending an update of 0

percentage points to the hospitalspecific rate for sole community and

Medicare-dependent, small rural

hospitals. We continue to believe these

recommended update factors would

ensure that Medicare acts as a prudent

purchaser and would provide incentives

to hospitals for increased efficiency,

thereby contributing to the solvency of

the Medicare Part A Trust Fund.

We are also recommending an update

of 0 percentage points for hospitals and

hospital units excluded from the

prospective payment system. This

update is consistent with the updates

provided to the prospective payment

hospitals.

Comment: Several commenters

opposed the Secretary’s

recommendation that prospective

payment hospitals receive a 0 percent

update for FY 1998. The commenters

observed that HCFA’s update framework

analysis supports a recommendation of

not less than the market basket

percentage increase minus 1.6

percentage points and asked why we

had not relied on the results of the

update framework in determining the

recommended update. The commenters

further stated that our recommendation

ignores the variation in financial

condition among hospitals and that the

lack of an increase in the standardized

amount will have an adverse impact on

a significant number of hospitals.

ProPAC supported our

recommendation for an update of 0

percentage points, noting that the

average Medicare inpatient operating

costs per case and lengths of stay in

prospective payment hospitals are both

continuing to decrease, while total

operating margins for hospitals have

increased sharply. ProPAC believes that

a 0 update will not harm either the

hospital industry or Medicare

beneficiaries.

Response: In developing our update

recommendation, we took into account

the results of our update framework

analysis in combination with several

other factors. As stated in the proposed

rule, these factors included the relative

decrease in the use of hospital inpatient

services and the corresponding increase

in the use of hospital outpatient and

postacute care services. We also

considered the factors cited by ProPAC,

particularly the decrease in costs per

case. Thus, although we recognize that

there is variation in financial condition

among hospitals, we believe that a 0

percentage point update will result in

payment rates that adequately

compensate hospitals for the costs of

efficient and effective treatment of

Medicare beneficiaries.

Comment: Several commenters stated

that the Secretary’s recommendation of
46140 Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations

a 0 percentage point update,

notwithstanding the results of HCFA’s

update framework analysis, could lower

the confidence of hospitals in HCFA’s

objectivity. They indicated that the

discrepancy between the results of the

update framework and the

recommended update casts doubts on

HCFA’s ability to administer the

prospective payment system fairly.

Response: We strongly object to the

suggestion that the difference between

the results of HCFA’s update framework

analysis and the Secretary’s

recommended update indicates any lack

of objectivity in our analysis process or

reflects on our ability to administer the

Medicare program impartially. The

update framework analysis is a largely

empirical process carried out by HCFA

that quantifies changes in hospital

productivity, scientific and

technological advances, practice pattern

changes, and hospital case mix. In

recommending an update, the Secretary

takes these factors into account, as well

as other factors such as the

recommendations of ProPAC and the

long-term solvency of the Medicare trust

fund. Thus, the difference between the

results of HCFA’s update framework

and the update recommended by the

Secretary is reflective of the integrity of

the update framework analysis process,

which has not been compromised to

produce an artificial congruence with

the Secretary’s recommendation. We

continue to believe that the

recommended update of 0 percentage

points appropriately adjusts for overall

changes occurring in the health care

delivery system.

III. Secretary’s Final Recommendation

for Updating the Rate-of-Increase

Limits for Excluded Hospitals

Our final recommendation is that

hospitals and hospital units excluded

from the prospective payment system

also receive an update of 0 percentage

points. This update is consistent with

the updates provided to the prospective

payment hospitals. We note that we

carry out a separate update framework

analysis for excluded hospitals and

units, but the analysis indicates the

same findings regarding changes in

productivity, scientific and

technological advances, practice

patterns, and case mix for FY 1998 for

excluded hospitals and for prospective

payment system hospitals. We believe

these updates will ensure that Medicare

acts as a prudent purchaser and will

provide incentives to hospitals for

increased efficiency, thereby

contributing to the solvency of the

Medicare Part A Trust Fund.

[FR Doc. 97–22890 Filed 8–28–97; 8:45 am]

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