Wednesday, 

May 4, 2005 

Book 2 of 2 Books 

Pages 23305–23774 

Part II 

Department of 

Health and Human 

Services 

Centers for Medicare & Medicaid Services 

42 CFR Parts 405, 412, et al. 

Medicare Program; Proposed Changes to 

the Hospital Inpatient Prospective 

Payment Systems and Fiscal Year 2006 

Rates; Proposed Rule 

23306 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

DEPARTMENT OF HEALTH AND 

HUMAN SERVICES 

Centers for Medicare & Medicaid 

Services 

42 CFR Parts 405, 412, 413, 415, 419, 

422, and 485 

[CMS–1500–P] 

RIN 0938–AN57 

Medicare Program; Proposed Changes 

to the Hospital Inpatient Prospective 

Payment Systems and Fiscal Year 2006 

Rates 

AGENCY: Centers for Medicare and 

Medicaid Services (CMS), HHS. 

ACTION: Proposed rule. 

SUMMARY: We are proposing to revise the 

Medicare hospital inpatient prospective 

payment systems (IPPS) for operating 

and capital-related costs to implement 

changes arising from our continuing 

experience with these systems. In 

addition, in the Addendum to this 

proposed rule, we describe the proposed 

changes to the amounts and factors used 

to determine the rates for Medicare 

hospital inpatient services for operating 

costs and capital-related costs. We also 

are setting forth proposed rate-ofincrease limits as well as proposed 

policy changes for hospitals and 

hospital units excluded from the IPPS 

that are paid in full or in part on a 

reasonable cost basis subject to these 

limits. These proposed changes would 

be applicable to discharges occurring on 

or after October 1, 2005, with one 

exception: The proposed changes 

relating to submittal of hospital wage 

data by a campus or campuses of a 

multicampus hospital system (that is, 

the proposed changes to § 412.230(d)(2) 

of the regulations) would be effective 

upon publication of the final rule. 

Among the policy changes that we are 

proposing to make are changes relating 

to: the classification of cases to the 

diagnosis-related groups (DRGs); the 

long-term care (LTC)–DRGs and relative 

weights; the wage data, including the 

occupational mix data, used to compute 

the wage index; rebasing and revision of 

the hospital market basket; applications 

for new technologies and medical 

services add-on payments; policies 

governing postacute care transfers, 

payments to hospitals for the direct and 

indirect costs of graduate medical 

education, submission of hospital 

quality data, payment adjustment for 

low-volume hospitals, changes in the 

requirements for provider-based 

facilities; and changes in the 

requirements for critical access 

hospitals (CAHs). 

DATES: Comments will be considered if 

received at the appropriate address, as 

provided in the ADDRESSES section, no 

later than 5 p.m. on June 24, 2005. 

ADDRESSES: In commenting, please refer 

to file code CMS–1500–P. Because of 

staff and resource limitations, we cannot 

accept comments by facsimile (FAX) 

transmission. 

You may submit comments in one of 

three ways (no duplicates, please): 

1. Electronically 

You may submit electronic comments 

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

ecomments (attachments should be in 

Microsoft Word, WordPerfect, or Excel; 

however, we prefer Microsoft Word). 

2. By Mail 

You may mail written comments (one 

original and two copies) to the following 

address only: Centers for Medicare & 

Medicaid Services, Department of 

Health and Human Services, Attention: 

CMS–1500–P, P.O. Box 8011, Baltimore, 

MD 21244–1850. 

Please allow sufficient time for mailed 

comments to be received before the 

close of the comment period. 

3. By Hand or Courier 

If you prefer, you may deliver (by 

hand or courier) your written comments 

(one original and two copies) before the 

close of the comment period to one of 

the following addresses. If you intend to 

deliver your comments to the Baltimore 

address, please call telephone number 

(410) 786–7195 in advance to schedule 

your arrival with one of our staff 

members. 

Room 445–G, Hubert H. Humphrey 

Building, 200 Independence Avenue, 

SW., Washington, DC 20201, or 7500 

Security Boulevard, Baltimore, MD 

21244–1850. 

(Because access to the interior of the 

Hubert H. Humphrey Building is not 

readily available to persons without 

Federal Government identification, 

commenters are encouraged to leave 

their comments in the CMS drop slots 

located in the main lobby of the 

building. A stamp-in clock is available 

for persons wishing to retain proof of 

filing by stamping in and retaining an 

extra copy of the comments being filed.) 

Comments mailed to the addresses 

indicated as appropriate for hand or 

courier delivery may be delayed and 

received after the comment period. 

Inspection of Public Comments: All 

comments received before the close of 

the comment period are available for 

viewing by the public, including any 

personally identifiable or confidential 

business information that is included in 

a comment. After the close of the 

comment period, CMS posts all 

electronic comments received before the 

close of the comment period on its 

public Web site. Written comments 

received timely will be available for 

public inspection as they are received, 

generally beginning approximately 4 

weeks after publication of a document, 

at the headquarters of the Centers for 

Medicare & Medicaid Services, 7500 

Security Boulevard, Baltimore, MD 

21244, Monday through Friday of each 

week from 8:30 a.m. to 4 p.m. To 

schedule an appointment to view public 

comments, phone 1–800–743–3951. 

For comments that relate to 

information collection requirements, 

mail a copy of comments to the 

following addresses: 

Centers for Medicare & Medicaid 

Services, Office of Strategic 

Operations and Regulatory Affairs, 

Security and Standards Group, Office 

of Regulations Development and 

Issuances, Room C4–24–02 7500 

Security Boulevard, Baltimore, 

Maryland 21244–1850, Attn: James 

Wickliffe, CMS–1500–P; and 

Office of Information and Regulatory 

Affairs, Office of Management and 

Budget, Room 3001, New Executive 

Office Building, Washington, DC 

20503, Attn: Christopher Martin, CMS 

Desk Officer, CMS–1500–P, 

Christopher_Martin@omb.eop.gov. 

Fax (202) 395–6974. 

FOR FURTHER INFORMATION CONTACT: 

Marc Harstein, (410) 786–4539, 

Operating Prospective Payment, 

Diagnosis-Related Groups (DRGs), 

Wage Index, New Medical Services 

and Technology Add-On Payments, 

Hospital Geographic Reclassifications, 

Postacute Care Transfers, and 

Disproportionate Share Hospital 

Issues. 

Tzvi Hefter, (410) 786–4487, Capital 

Prospective Payment, Excluded 

Hospitals, Graduate Medical 

Education, Critical Access Hospitals, 

and Long-Term Care (LTC)–DRGs, and 

Provider-Based Facilities Issues. 

Steve Heffler, (410) 786–1211, Hospital 

Market Basket Revision and Rebasing. 

Siddhartha Mazumdar, (410) 786–6673, 

Rural Hospital Community 

Demonstration Project Issues. 

Mary Collins, (410) 786–3189, Critical 

Access Hospitals (CAHs) Issues. 

Dr. Mark Krushat, (410) 786–6809, 

Quality Data for Annual Payment 

Update Issues. 

Martha Kuespert, (410) 786–4605 

Specialty Hospitals Definition Issues. 

SUPPLEMENTARY INFORMATION: 

Electronic Access 

This Federal Register document is 

also available from the Federal Register 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23307 

online database through GPO Access, a 

service of the U.S. Government Printing 

Office. Free public access is available on 

a Wide Area Information Server (WAIS) 

through the Internet and via 

asynchronous dial-in. Internet users can 

access the database by using the World 

Wide Web; the Superintendent of 

Documents home page address is http:// 

www.access.gpo.gov/nara_docs, by 

using local WAIS client software, or by 

telnet to swais.access.gpo.gov, then 

login as guest (no password required). 

Dial-in users should use 

communications software and modem 

to call (202) 512–1661; type swais, then 

login as guest (no password required). 

Acronyms 

AAOS American Association of Orthopedic 

Surgeons 

ACGME Accreditation Council on Graduate 

Medical Education 

AHIMA American Health Information 

Management Association 

AHA American Hospital Association 

AICD Automatic cardioverter defibrillator 

AMI Acute myocardial infarction 

AOA American Osteopathic Association 

ASC Ambulatory Surgical Center 

ASP Average sales price 

AWP Average wholesale price 

BBA Balanced Budget Act of 1997, Pub. L. 

105–33 

BES Business Expenses Survey 

BIPA Medicare, Medicaid, and SCHIP [State 

Children’s Health Insurance Program] 

Benefits Improvement and Protection Act 

of 2000, Pub. L. 106–554 

BLS Bureau of Labor Statistics 

CAH Critical access hospital 

CBSAs Core-Based Statistical Areas 

CC Complication or comorbidity 

CIPI Capital Input Price Index 

CMS Centers for Medicare & Medicaid 

Services 

CMSA Consolidated Metropolitan 

Statistical Area 

COBRA Consolidated Omnibus 

Reconciliation Act of 1985, Pub. L. 99–272 

CoP Condition of Participation 

CPI Consumer Price Index 

CRNA Certified registered nurse anesthetist 

CRT Cardiac Resynchronization Therapy 

DRG Diagnosis-related group 

DSH Disproportionate share hospital 

ECI Employment Cost Index 

FDA Food and Drug Administration 

FIPS Federal Information Processing 

Standards 

FQHC Federally qualified health center 

FTE Full-time equivalent 

FY Federal fiscal year 

GAAP Generally accepted accounting 

principles 

GAF Geographic adjustment factor 

HIC Health Insurance Card 

HIS Health Information System 

GME Graduate medical education 

HCRIS Hospital Cost Report Information 

System 

HIPC Health Information Policy Council 

HIPAA Health Insurance Portability and 

Accountability Act of 1996, Pub. L. 104–

191 

HHA Home health agency 

HHS Department of Health and Human 

Services 

HPSA Health Professions Shortage Area 

HQA Hospital Quality Alliance 

ICD–9–CM International Classification of 

Diseases, Ninth Revision, Clinical 

Modification 

ICD–10–PCS International Classification of 

Diseases, Tenth Edition, Procedure Coding 

System 

ICF/MRs Intermediate care facilities for the 

mentally retarded 

ICU Intensive Care Unit 

IHS Indian Health Service 

IME Indirect medical education 

IPPS Acute care hospital inpatient 

prospective payment system 

IPF Inpatient psychiatric facility 

IRF Inpatient rehabilitation facility 

IRP Initial residency period 

JCAHO Joint Commission on Accreditation 

of Healthcare Organizations 

LAMCs Large area metropolitan counties 

LTC–DRG Long-term care diagnosis-related 

group 

LTCH Long-term care hospital 

MCE Medicare Code Editor 

MCO Managed care organization 

MDC Major diagnostic category 

MDH Medicare-dependent small rural 

hospital 

MedPAC Medicare Payment Advisory 

Commission 

MedPAR Medicare Provider Analysis and 

Review File 

MEI Medicare Economic Index 

MGCRB Medicare Geographic Classification 

Review Board 

MMA Medicare Prescription Drug, 

Improvement, and Modernization Act of 

2003, Pub. L. 108–173 

MRHFP Medicare Rural Hospital Flexibility 

Program 

MSA Metropolitan Statistical Area 

NAICS North American Industrial 

Classification System 

NCD National coverage determination 

NCHS National Center for Health Statistics 

NCVHS National Committee on Vital and 

Health Statistics 

NECMA New England County Metropolitan 

Areas 

NICU Neonatal intensive care unit 

NQF National Quality Forum 

NTIS National Technical Information 

Service 

NVHRI National Voluntary Hospital 

Reporting Initiative 

OES Occupational Employment Statistics 

OIG Office of the Inspector General 

OMB Executive Office of Management and 

Budget 

O.R. Operating room 

OSCAR Online Survey Certification and 

Reporting (System) 

OSHA Occupational Safety and Health Act 

PRM Provider Reimbursement Manual 

PPI Producer Price Index 

PMS Performance Measurement System 

PMSAs Primary Metropolitan Statistical 

Areas 

PPS Prospective payment system 

PRA Per resident amount 

ProPAC Prospective Payment Assessment 

Commission 

PRRB Provider Reimbursement Review 

Board 

PS&R Provider Statistical and 

Reimbursement System 

QIA Quality Improvement Organizations 

RHC Rural health clinic 

RHQDAPU Reporting Hospital Quality Data 

for Annual Payment Update 

RNHCI Religious nonmedical health care 

institution 

RRC Rural referral center 

RUCAs Rural-Urban Commuting Area 

Codes 

SCH Sole community hospital 

SDP Single Drug Pricer 

SIC Standard Industrial Codes 

SNF Skilled nursing facility 

SOCs Standard occupational classifications 

SOM State Operations Manual 

SSA Social Security Administration 

SSI Supplemental Security Income 

TEFRA Tax Equity and Fiscal 

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

UHDDS Uniform Hospital Discharge Data 

Set 

Table of Contents 

I. Background 

A. Summary 

1. Acute Care Hospital Inpatient 

Prospective Payment System (IPPS) 

2. Hospitals and Hospital Units Excluded 

from the IPPS 

a. IRFs 

b. LTCH 

c. IPFs 

3. Critical Access Hospitals (CAHs) 

4. Payments for Graduate Medical 

Education (GME) 

B. Major Contents of this Proposed Rule 

1. Proposed Changes to the DRG 

Reclassifications and Recalibrations of 

Relative Weights 

2. Proposed Changes to the Hospital Wage 

Index 

3. Proposed Revision and Rebasing of the 

Hospital Market Basket 

4. Other Decisions and Proposed Changes 

to the PPS for Inpatient Operating and 

GME Costs 

5. PPS for Capital-Related Costs 

6. Proposed Changes for Hospitals and 

Hospital Units Excluded from the IPPS 

7. Proposed Payment for Blood Clotting 

Factors for Inpatients with Hemophilia 

8. Determining Proposed Prospective 

Payment Operating and Capital Rates 

and Rate-of-Increase Limits 

9. Impact Analysis 

10. Recommendation of Update Factor for 

Hospital Inpatient Operating Costs 

11. Discussion of Medicare Payment 

Advisory Commission Recommendations 

II. Proposed Changes to DRG Classifications 

and Relative Weights 

A. Background 

B. DRG Reclassifications 

1. General 

2. Pre-MDC: Intestinal Transplantation 

3. MDC 1 (Diseases and Disorders of the 

Nervous System) 

a. Strokes 

b. Unruptured Cerebral Aneurysms 

4. MDC 5 (Diseases and Disorders of the 

Circulatory System) 

a. Automatic Implantable Cardioverter/ 

Defibrillator 

23308 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

b. Coronary Artery Stents 

c. Insertion of Left Atrial Appendage 

Device 

d. External Heart Assist System Implant 

e. Carotid Artery Stent 

f. Extracorporeal Membrane Oxygenation 

(ECMO) 

5. MDC 6 (Diseases and Disorders of the 

Digestive System): Artificial Anal 

Sphincter 

6. MDC 8 (Diseases and Disorders of the 

Musculoskeletal System and Connective 

Tissue) 

a. Hip and Knee Replacements 

b. Kyphoplasty 

c. Multiple Level Spinal Fusion 

7. MDC 18 (Infectious and Parasitic 

Diseases (Systemic or Unspecified 

Sites)): Severe Sepsis 

8. MDC 20 (Alcohol/Drug Use and 

Alcohol/Drug Induced Organic Mental 

Disorders): Drug-Induced Dementia 

9. Medicare Code Editor (MCE) Changes 

a. Newborn Age Edit 

b. Newborn Diagnoses Edit 

c. Diagnoses Allowed for ‘‘Males Only’’

Edit 

d. Tobacco Use Disorder Edit 

e. Noncovered Procedure Edit 

10. Surgical Hierarchies 

11. Refinement of Complications and 

Comorbidities (CC) List 

a. Background 

b. Comprehensive Review of the CC List 

c. CC Exclusion List for FY 2006 

12. Review of Procedure Codes in DRGs 

468, 476, and 477 

a. Moving Procedure Codes from DRG 468 

or DRG 477 to MDCs 

b. Reassignment of Procedures among 

DRGs 468, 476, and 477 

c. Adding Diagnosis or Procedure Codes to 

MDCs 

13. Changes to the ICD–9–CM Coding 

System 

14. Other Issues: Acute Intermittent 

Porphyria 

C. Proposed Recalibration of DRG Weights 

D. Proposed LTC–DRG Reclassifications 

and Relative Weights for LTCHs for FY 

2006 

1. Background 

2. Proposed Changes in the LTC–DRG 

Classifications 

a. Background 

b. Patient Classifications into DRGs 

3. Development of the Proposed FY 2006 

LTC–DRG Relative Weights 

a. General Overview of Development of the 

LTC–DRG Relative Weights 

b. Data 

c. Hospital-Specific Relative Value 

Methodology 

d. Proposed Low-Volume LTC–DRGs 

4. Steps for Determining the Proposed FY 

2006 LTC–DRG Relative Weights 

E. Proposed Add-On Payments for New 

Services and Technologies 

1. Background 

2. FY 2006 Status of Technology Approved 

for FY 2005 Add-On Payments 

3. Reevaluation of FY 2005 Applications 

That Were Not Approved 

4. FY 2006 Applicants for New Technology 

Add-On Payments 

III. Proposed Changes to the Hospital Wage 

Index 

A. Background 

B. Core-Based Statistical Areas for the 

Proposed Hospital Wage Index 

C. Proposed Occupational Mix Adjustment 

to FY 2006 Index 

1. Development of Data for the Proposed 

Occupational Mix Adjustment 

2. Calculation of the Proposed 

Occupational Mix Adjustment Factor 

and the Proposed Occupational Mix 

Adjusted Wage Index 

D. Worksheet S–3 Wage Data for the 

Proposed FY 2006 Wage Index Update 

E. Verification of Worksheet S–3 Wage 

Data 

F. Computation of the Proposed FY 2006 

Unadjusted Wage Index 

G. Computation of the Proposed FY 2006 

Blended Wage Index 

H. Proposed Revisions to the Wage Index 

Based on Hospital Redesignation 

1. General 

2. Effects of Reclassification 

3. Proposed Application of Hold Harmless 

Protection for Certain Urban Hospitals 

Redesignated as Rural 

4. FY 2006 MGCRB Reclassifications 

5. Proposed FY 2006 Redesignations under 

Section 1886(d)(8)(B) of the Act 

6. Reclassifications under Section 508 of 

Pub. L. 108–173 

I. Proposed FY 2006 Wage Index 

Adjustment Based on Commuting 

Patterns of Hospital Employees 

J. Process for Requests for Wage Index Data 

Corrections 

IV. Proposed Rebasing and Revision of the 

Hospital Market Baskets 

A. Background 

B. Rebasing and Revising the Hospital 

Market Basket 

1. Development of Cost Categories and 

Weights 

2. PPS—Selection of Price Proxies 

3. Labor-Related Share 

C. Separate Market Basket for Hospitals 

and Hospital Units Excluded from the 

IPPS 

1. Hospitals Paid Based on Their 

Reasonable Costs 

2. Excluded Hospitals Paid Under Blend 

Methodology 

3. Development of Cost Categories and 

Weights for the Proposed 2002-Based 

Excluded Hospital Market Basket 

D. Frequency of Updates of Weights in 

IPPS Hospital Market Basket 

E. Capital Input Price Index Section 

V. Other Decisions and Proposed Changes to 

the IPPS for Operating Costs and GME 

Costs 

A. Postacute Care Transfer Payment Policy 

1. Background 

2. Changes to DRGs Subject to the 

Postacute Care Transfer Policy 

B. Reporting of Hospital Quality Data for 

Annual Hospital Payment Update 

1. Background 

2. Requirements for Hospital Reporting of 

Quality Data 

C. Sole Community Hospitals and 

Medicare Dependent Hospitals 

1. Background 

2. Budget Neutrality Adjustment to 

Hospital Payments Based on HospitalSpecific Rate 

3. Technical Change 

D. Rural Referral Centers 

1. Case-Mix Index 

2. Discharges 

3. Technical Change 

E. Payment Adjustment for Low-Volume 

Hospitals 

F. Indirect Medical Education (IME) 

Adjustment 

1. Background 

2. IME Adjustment for TEFRA Hospitals 

Converting to IPPS Hospitals 

3. Section 1886(d)(3)(E) Teaching Hospitals 

That Withdraw Rural Reclassification 

G. Payment to Disproportionate Share 

Hospitals (DSHs) 

1. Background 

2. Implementation of Section 951 of Pub. 

L. 108–173 

H. Geographic Reclassifications 

1. Background 

2. Multicampus Hospitals 

3. Urban Group Hospital Reclassifications 

4. Clarification of Goldsmith Modification 

Criterion for Urban Hospitals Seeking 

Reclassification as Rural 

I. Payment for Direct Graduate Medical 

Education 

1. Background 

2. Direct GME Initial Residency Period 

a. Background 

b. Direct GME Initial Residency Period 

Limitation: Simultaneous Match 

3. New Teaching Hospitals’ Participation 

in Medicare GME Affiliated Groups 

4. GME FTE Cap Adjustments for Rural 

Hospitals 

5. Technical Changes: Cross-References 

J. Provider-Based Status of Facilities under 

Medicare 

1. Background 

2. Limits on Scope of Provider-Based 

Regulations—Facilities for Which 

Provider-Based Determinations Will Not 

Be Made 

3. Location Requirement for Off-Campus 

Facilities: Application to Certain 

Neonatal Intensive Care Units 

4. Technical and Clarifying Changes 

K. Rural Community Hospital 

Demonstration Program 

L. Definition of a Hospital in Connection 

with Specialty Hospitals 

VI. PPS for Capital-Related Costs 

VII. Proposed Changes for Hospitals and 

Hospital Units Excluded from the IPPS 

A. Payments to Excluded Hospitals and 

Hospital Units 

1. Payments to Existing Excluded Hospitals 

and Hospital Units 

2. Updated Caps for New Excluded 

Hospitals and Units 

3. Implementation of a PPS for IRFs 

4. Implementation of a PPS for LTCHs 

5. Implementation of a PPS for IPFs 

B. Critical Access Hospitals (CAHs) 

1. Background 

2. Proposed Policy Change Relating to 

Continued Participation by CAHs in 

Lugar Counties 

3. Proposed Policy Change Relating to 

Designation of CAHs as Necessary 

Providers 

a. Determination of the Relocation Status of 

a CAH 

b. Relocation of a CAH Using a Waiver to 

Meet the CoP for Distance 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23309 

VIII. Payment for Blood Clotting Factor 

Administered to Hemophilia Inpatients 

IX. MedPAC Recommendations 

A. Medicare Payment Policy 

B. Physician-Owned Specialty Hospitals 

C. Other MedPAC Recommendations 

X. Other Required Information 

A. Requests for Data from the Public 

B. Collection of Information Requirements 

C. Public Comments 

Regulation Text 

Addendum—Proposed Schedule of 

Standardized Amounts Effective with 

Discharges Occurring On or After 

October 1, 2004 and Update Factors and 

Rate-of-Increase Percentages Effective 

With Cost Reporting Periods Beginning 

On or After October 1, 2004 

I. Summary and Background 

II. Proposed Changes to Prospective Payment 

Rates for Hospital Inpatient Operating 

Costs for FY 2006 

A. Calculation of the Adjusted 

Standardized Amount 

1. Standardization of Base-Year Costs or 

Target Amounts 

2. Computing the Average Standardized 

Amount 

3. Updating the Average Standardized 

Amount 

4. Other Adjustments to the Average 

Standardized Amount 

a. Recalibration of DRG Weights and 

Updated Wage Index—Budget Neutrality 

Adjustment 

b. Reclassified Hospitals—Budget 

Neutrality Adjustment 

c. Outliers 

d. Rural Community Hospital 

Demonstration Program Adjustment 

(Section 410A of Pub. L. 108–173) 

5. Proposed FY 2006 Standardized Amount 

B. Adjustments for Area Wage Levels and 

Cost-of-Living 

1. Adjustment for Area Wage Levels 

2. Adjustment for Cost-of-Living in Alaska 

and Hawaii 

C. DRG Relative Weights 

D. Calculation of Proposed Prospective 

Payment Rates for FY 2006 

1. Federal Rate 

2. Hospital-Specific Rate (Applicable Only 

to SCHs and MDHs) 

a. Calculation of Hospital-Specific Rate 

b. Updating the FY 1982, FY 1987, and FY 

1996 Hospital-Specific Rates for FY 2006 

3. General Formula for Calculation of 

Proposed Prospective Payment Rates for 

Hospitals Located in Puerto Rico 

Beginning On or After October 1, 2005 

and Before October 1, 2006 

a. Puerto Rico Rate 

b. National Rate 

III. Proposed Changes to Payment Rates for 

Acute Care Hospital Inpatient CapitalRelated Costs for FY 2006 

A. Determination of Proposed Federal 

Hospital Inpatient Capital-Related 

Prospective Payment Rate Update 

1. Proposed Capital Standard Federal Rate 

Update 

a. Description of the Update Framework 

b. Comparison of CMS and MedPAC 

Update Recommendation 

2. Proposed Outlier Payment Adjustment 

Factor 

3. Proposed Budget Neutrality Adjustment 

Factor for Changes in DRG 

Classifications and Weights and the 

Geographic Adjustment Factor 

4. Proposed Exceptions Payment 

Adjustment Factor 

5. Proposed Capital Standard Federal Rate 

for FY 2006 

6. Proposed Special Capital Rate for Puerto 

Rico Hospitals 

B. Calculation of Proposed Inpatient 

Capital-Related Prospective Payments for 

FY 2006 

C. Capital Input Price Index 

1. Background 

2. Forecast of the CIPI for FY 2006 

IV. Proposed Changes to Payment Rates for 

Excluded Hospitals and Hospital Units: 

Rate-of-Increase Percentages 

A. Payments to Existing Excluded 

Hospitals and Units 

B. Updated Caps for New Excluded 

Hospitals and Units 

V. Payment for Blood Clotting Factor 

Administered to Hemophilia Inpatients 

Tables 

Table 1A—National Adjusted Operating 

Standardized Amounts, Labor/Nonlabor 

(69.7 Percent Labor Share/30.3 Percent 

Nonlabor Share If Wage Index Is Greater 

Than 1) 

Table 1B—National Adjusted Operating 

Standardized Amounts, Labor/Nonlabor 

(62 Percent Labor Share/38 Percent 

Nonlabor Share If Wage Index Is Less 

Than or Equal to 1) 

Table 1C—Adjusted Operating Standardized 

Amounts for Puerto Rico, Labor/ 

Nonlabor 

Table 1D—Capital Standard Federal Payment 

Rate 

Table 2—Hospital Case-Mix Indexes for 

Discharges Occurring in Federal Fiscal 

Year 2004; Hospital Average Hourly 

Wage for Federal Fiscal Years 2004 (2000 

Wage Data), 2005 (2001 Wage Data), and 

2006 (2002 Wage Data) Wage Indexes 

and 3-Year Average of Hospital Average 

Hourly Wages 

Table 3A—FY 2006 and 3-Year Average 

Hourly Wage for Urban Areas 

Table 3B—FY 2006 and 3-Year Average 

Hourly Wage for Rural Areas 

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 4F—Puerto Rico Wage Index and 

Capital Geographic Adjustment Factor 

(GAF) 

Table 4J—Out-Migration Adjustment—FY 

2006 

Table 5—List of Diagnosis-Related Groups 

(DRGs), Relative Weighting Factors, and 

Geometric and Arithmetic Mean Length 

of Stay (LOS) 

Table 6A—New Diagnosis Codes 

Table 6B—New Procedure Codes 

Table 6C—Invalid Diagnosis Codes 

Table 6D—Invalid Procedure Codes 

Table 6E—Revised Diagnosis Code Titles 

Table 6F—Revised Procedure Code Titles 

Table 6G—Additions to the CC Exclusions 

List 

Table 6H—Deletions from the CC Exclusions 

List 

Table 7A—Medicare Prospective Payment 

System Selected Percentile Lengths of 

Stay: FY 2004 MedPAR Update 

December 2004 GROUPER V22.0 

Table 7B—Medicare Prospective Payment 

System Selected Percentile Lengths of 

Stay: FY 2004 MedPAR Update 

December 2004 GROUPER V23.0 

Table 8A—Statewide Average Operating 

Cost-to-Charge Ratios—March 2005 

Table 8B—Statewide Average Capital Cost-toCharge Ratios—March 2005 

Table 9A—Hospital Reclassifications and 

Redesignations by Individual Hospital—

FY 2006 

Table 9B—Hospital Reclassifications and 

Redesignation by Individual Hospital 

Under Section 508 of Pub. L. 108–173—

FY 2005 

Table 9C—Hospitals Redesignated as Rural 

under Section 1886(d)(8)(E) of the Act—

FY 2006 

Table 10—Geometric Mean Plus the Lesser of 

.75 of the National Adjusted Operating 

Standardized Payment Amount 

(Increased to Reflect the Difference 

Between Costs and Charges) or .75 of 

One Standard Deviation of Mean Charges 

by Diagnosis-Related Groups (DRGs)—

March 2005 

Table 11—Proposed FY 2006 LTC–DRGs, 

Relative Weights, Geometric Average 

Length of Stay, and 5/6ths of the 

Geometric Average Length of Stay 

Appendix A—Regulatory Impact Analysis 

Appendix B—Recommendation of Update 

Factors for Operating Cost Rates of 

Payment for Inpatient Hospital Services 

I. Background 

A. Summary 

1. Acute Care Hospital Inpatient 

Prospective Payment System (IPPS) 

Section 1886(d) of the Social Security 

Act (the Act) sets forth 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. Section 

1886(g) of the Act requires the Secretary 

to pay for the capital-related costs of 

hospital inpatient stays under a 

prospective payment system (PPS). 

Under these PPSs, Medicare payment 

for hospital inpatient operating and 

capital-related costs is made at 

predetermined, specific rates for each 

hospital discharge. Discharges are 

classified according to a list of 

diagnosis-related groups (DRGs). 

The base payment rate is comprised of 

a standardized amount that is divided 

into a labor-related share and a 

nonlabor-related share. The laborrelated share is adjusted by the wage 

index applicable to the area where the 

23310 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

hospital is located; and if the hospital is 

located in Alaska or Hawaii, the 

nonlabor-related share is adjusted by a 

cost-of-living adjustment factor. This 

base payment rate is multiplied by the 

DRG relative weight. 

If the hospital treats a high percentage 

of low-income patients, it receives a 

percentage add-on payment applied to 

the DRG-adjusted base payment rate. 

This add-on payment, known as the 

disproportionate share hospital (DSH) 

adjustment, provides for a percentage 

increase in Medicare payments to 

hospitals that qualify under either of 

two statutory formulas designed to 

identify hospitals that serve a 

disproportionate share of low-income 

patients. For qualifying hospitals, the 

amount of this adjustment may vary 

based on the outcome of the statutory 

calculations. 

If the hospital is an approved teaching 

hospital, it receives a percentage add-on 

payment for each case paid under the 

IPPS (known as the indirect medical 

education (IME) adjustment). This 

percentage varies, depending on the 

ratio of residents to beds. 

Additional payments may be made for 

cases that involve new technologies or 

medical services that have been 

approved for special add-on payments. 

To qualify, a new technology or medical 

service must demonstrate that it is a 

substantial clinical improvement over 

technologies or services otherwise 

available, and that, absent an add-on 

payment, it would be inadequately paid 

under the regular DRG payment. 

The costs incurred by the hospital for 

a case are evaluated to determine 

whether the hospital is eligible for an 

additional payment as an outlier case. 

This additional payment is designed to 

protect the hospital from large financial 

losses due to unusually expensive cases. 

Any outlier payment due is added to the 

DRG-adjusted base payment rate, plus 

any DSH, IME, and new technology or 

medical service add-on adjustments. 

Although payments to most hospitals 

under the IPPS are made on the basis of 

the standardized amounts, some 

categories of hospitals are paid the 

higher of a hospital-specific rate based 

on their costs in a base year (the higher 

of FY 1982, FY 1987, or FY 1996) or the 

IPPS rate based on the standardized 

amount. For example, sole community 

hospitals (SCHs) are the sole source of 

care in their areas, and Medicaredependent, small rural hospitals 

(MDHs) are a major source of care for 

Medicare beneficiaries in their areas. 

Both of these categories of hospitals are 

afforded this special payment protection 

in order to maintain access to services 

for beneficiaries. (An MDH receives 

only 50 percent of the difference 

between the IPPS rate and its hospitalspecific rates if the hospital-specific rate 

is higher than the IPPS rate. In addition, 

an MDH does not have the option of 

using FY 1996 as the base year for its 

hospital-specific rate.) 

Section 1886(g) of the Act requires the 

Secretary to pay for the capital-related 

costs of inpatient hospital services ‘‘in 

accordance with a prospective payment 

system established by the Secretary.’’

The basic methodology for determining 

capital prospective payments is set forth 

in our regulations at 42 CFR 412.308 

and 412.312. Under the capital PPS, 

payments are adjusted by the same DRG 

for the case as they are under the 

operating IPPS. Similar adjustments are 

also made for IME and DSH as under the 

operating IPPS. In addition, hospitals 

may receive an outlier payment for 

those cases that have unusually high 

costs. 

The existing regulations governing 

payments to hospitals under the IPPS 

are located in 42 CFR part 412, Subparts 

A through M. 

2. Hospitals and Hospital Units 

Excluded From the IPPS 

Under section 1886(d)(1)(B) of the 

Act, as amended, certain specialty 

hospitals and hospital units are 

excluded from the IPPS. These hospitals 

and units are: Psychiatric hospitals and 

units; rehabilitation hospitals and units; 

long-term care hospitals (LTCHs); 

children’s hospitals; and cancer 

hospitals. Various sections of the 

Balanced Budget Act of 1997 (Pub. L. 

105–33), the Medicare, Medicaid and 

SCHIP [State Children’s Health 

Insurance Program] Balanced Budget 

Refinement Act of 1999 (Pub. L. 106–

113), and the Medicare, Medicaid, and 

SCHIP Benefits Improvement and 

Protection Act of 2000 (Pub. L. 106–554) 

provide for the implementation of PPSs 

for rehabilitation hospitals and units 

(referred to as inpatient rehabilitation 

facilities (IRFs)), psychiatric hospitals 

and units (referred to as inpatient 

psychiatric facilities (IPFs)), and LTCHs, 

as discussed below. Children’s hospitals 

and cancer hospitals continue to be paid 

under reasonable cost-based 

reimbursement. 

The existing regulations governing 

payments to excluded hospitals and 

hospital units are located in 42 CFR 

Parts 412 and 413. 

a. IRFs 

Under section 1886(j) of the Act, as 

amended, rehabilitation hospitals and 

units (IRFs) have been transitioned from 

payment based on a blend of reasonable 

cost reimbursement subject to a 

hospital-specific annual limit under 

section 1886(b) of the Act and the 

adjusted facility Federal prospective 

payment rate for cost reporting periods 

beginning January 1, 2002 through 

September 30, 2002, to payment at 100 

percent of the Federal rate effective for 

cost reporting periods beginning on or 

after October 1, 2002 (66 FR 41316, 

August 7, 2001; 67 FR 49982, August 1, 

2002; and 68 FR 45674, August 1, 2003). 

The existing regulations governing 

payments under the IRF PPS are located 

in 42 CFR Part 412, Subpart P. 

b. LTCHs 

Under the authority of sections 123(a) 

and (c) of Pub. L. 106–113 and section 

307(b)(1) of Pub. L. 106–554, LTCHs are 

being transitioned from being paid for 

inpatient hospital services based on a 

blend of reasonable cost-based 

reimbursement under section 1886(b) of 

the Act to 100 percent of the Federal 

rate during a 5-year period, beginning 

with cost reporting periods that start on 

or after October 1, 2002. For cost 

reporting periods beginning on or after 

October 1, 2006, LTCHs will be paid 100 

percent of the Federal rate (May 7, 2004 

LTCH PPS final rule (69 FR 25674)). 

LTCHs may elect to be paid based on 

100 percent of the Federal rate instead 

of a blended payment in any year during 

the 5-year transition period. The 

existing regulations governing payment 

under the LTCH PPS are located in 42 

CFR Part 412, Subpart O. 

c. IPFs 

Under the authority of sections 124(a) 

and (c) of Pub. L. 106–113, inpatient 

psychiatric facilities (IPFs) (formerly 

psychiatric hospitals and psychiatric 

units of acute care hospitals) are paid 

under the new IPF PPS. Under the IPF 

PPS, some IPFs are transitioning from 

being paid for inpatient hospital 

services based on a blend of reasonable 

cost-based payment and a Federal per 

diem payment rate, effective for cost 

reporting periods beginning on or after 

January 1, 2005 (November 15, 2004 IPF 

PPS final rule (69 FR 66921)). For cost 

reporting periods beginning on or after 

July 1, 2008, IPFs will be paid 100 

percent of the Federal per diem 

payment amount. The existing 

regulations governing payment under 

the IPF PPS are located in 42 CFR part 

412, subpart N. 

3. Critical Access Hospitals (CAHs) 

Under sections 1814, 1820, and 

1834(g) of the Act, payments are made 

to critical access hospitals (CAHs) (that 

is, rural hospitals or facilities that meet 

certain statutory requirements) for 

inpatient and outpatient services based 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23311 

on 101 percent of reasonable cost. 

Reasonable cost is determined under the 

provisions of section 1861(v)(1)(A) of 

the Act and existing regulations under 

42 CFR Parts 413 and 415. 

4. Payments for Graduate Medical 

Education (GME) 

Under section 1886(a)(4) of the Act, 

costs of approved educational activities 

are excluded from the operating costs of 

inpatient hospital services. Hospitals 

with approved graduate medical 

education (GME) programs are paid for 

the direct costs of GME in accordance 

with section 1886(h) of the Act; the 

amount of payment for direct GME costs 

for a cost reporting period is based on 

the hospital’s number of residents in 

that period and the hospital’s costs per 

resident in a base year. The existing 

regulations governing payments to the 

various types of hospitals are located in 

42 CFR Part 413. 

On August 11, 2004, we published a 

final rule in the Federal Register (69 FR 

48916) that implemented changes to the 

Medicare hospital inpatient prospective 

payment systems for both operating cost 

and capital-related costs, as well as 

changes addressing payments for 

excluded hospitals and payments for 

GME costs. Generally these changes 

were effective for discharges occurring 

on or after October 1, 2004. On October 

7, 2004, we published a document in 

the Federal Register (69 FR 60242) that 

corrected technical errors made in the 

August 11, 2004 final rule. On 

December 30, 2004, we published 

another document in the Federal 

Register (69 FR 78525) that further 

corrected the August 11, 2004 final rule 

and the October 7, 2004 correction to 

that rule, effective January 1, 2005. 

B. Major Contents of This Proposed Rule 

In this proposed rule, we are setting 

forth proposed changes to the Medicare 

IPPS for operating costs and for capitalrelated costs in FY 2006. We also are 

setting forth proposed changes relating 

to payments for GME costs, payments to 

certain hospitals and units that continue 

to be excluded from the IPPS and paid 

on a reasonable cost basis, payments for 

DSHs, and requirements and payments 

for CAHs. The changes being proposed 

would be effective for discharges 

occurring on or after October 1, 2005, 

unless otherwise noted. 

The following is a summary of the 

major changes that we are proposing to 

make: 

1. Proposed Changes to the DRG 

Reclassifications and Recalibrations of 

Relative Weights 

As required by section 1886(d)(4)(C) 

of the Act, in section II. of this proposed 

rule, we are proposing annual 

adjustments to the DRG classifications 

and relative weights. Based on analyses 

of Medicare claims data, we are 

proposing to establish a number of new 

DRGs and make changes to the 

designation of diagnosis and procedure 

codes under other existing DRGs. 

The major DRG classification changes 

we are proposing include: 

• Reassigning procedure code 35.52 

(Repair of atrial septal defect with 

prosthesis, closed technique) from DRG 

108 to DRG 518 (Percutaneous 

Cardiovascular Procedure Without 

Coronary Artery Stent or AMI); 

• Reassigning procedure code 37.26 

(Cardiac electrophysiologic stimulation 

and recording studies) from DRGs 535 

and 536 to DRGs 515 (Cardiac 

Defibrillator Implant Without Cardiac 

Catheterization); 

• Splitting DRG 209 into two new 

DRGs based on the presence or absence 

of the procedure codes for major joint 

replacement or reattachment of lower 

extremity and revision of hip or knee 

replacement, DRG 545 (Revision of Hip 

or Knee Replacement) and DRG 544 

(Major Joint Replacement or 

Reattachment of Lower Extremity); 

• Reassigning procedure code 26.12 

(Open biopsy of salivary gland or duct) 

from DRG 468 to DRG 477 

(Nonextensive O.R. Procedure Unrelated 

To Principal Diagnosis); 

• Reassigning the principal diagnosis 

codes for curvature of the spine or 

malignancy from DRGs 497 and 498 to 

proposed new DRG 546 (Spinal Fusion 

Except Cervical with PDX of Curvature 

of the Spine or Malignancy); 

• Splitting DRGs 516 and 526 into 

four new DRGs based on the presence or 

absence of a CC; 

• Reassigning procedure code 39.65 

(Extracorporeal membrane oxygenation 

[ECMO]) from DRGs 104 and 105 to 

DRG 541 (ECMO or Tracheostomy with 

Mechanical Ventilation 96+ Hours or 

Principal Diagnosis Except Face, Mouth 

and Neck Diagnoses With Major 

Operating Room Procedure). 

We also are presenting our 

reevaluation of certain FY 2005 

applicants for add-on payments for 

high-cost new medical services and 

technologies, and our analysis of FY 

2006 applicants (including public input, 

as directed by Pub. L. 108–173, obtained 

in a town hall meeting). 

We are proposing the annual update 

of the long-term care diagnosis-related 

group (LTC–DRG) classifications and 

relative weights for use under the LTCH 

PPS for FY 2006. 

2. Proposed Changes to the Hospital 

Wage Index 

In section III. of this preamble, we are 

proposing revisions to the wage index 

and the annual update of the wage data. 

Specific issues addressed include the 

following: 

• The FY 2006 wage index update, 

using wage data from cost reporting 

periods that began during FY 2002. 

• The proposed occupational mix 

adjustment to the wage index that we 

began to apply effective October 1, 2004. 

• The proposed revisions to the wage 

index based on hospital redesignations 

and reclassifications. 

• The proposed adjustment to the 

wage index for FY 2006 based on 

commuting patterns of hospital 

employees who reside in a county and 

work in a different area with a higher 

wage index. 

• The timetable for reviewing and 

verifying the wage data that will be in 

effect for the proposed FY 2006 wage 

index. 

3. Proposed Revision and Rebasing of 

the Hospital Market Baskets 

In section IV. of this proposed rule, 

we are proposing rebasing and revising 

the hospital operating and capital 

market baskets to be used in developing 

the FY 2006 update factor for the 

operating prospective payment rates and 

the excluded hospital market basket to 

be used in developing the FY 2006 

update factor for the excluded hospital 

rate-of-increase limits. We are also 

setting forth the data sources used to 

determine the revised market basket 

relative weights and choice of price 

proxies. 

4. Other Decisions and Proposed 

Changes to the PPS for Inpatient 

Operating and GME Costs 

In section V. of this proposed rule, we 

discuss a number of provisions of the 

regulations in 42 CFR Parts 412 and 413 

and set forth proposed changes 

concerning the following: 

• Solicitation of public comments on 

two options for possible expansion of 

the current postacute care transfer 

policy. 

• The reporting of hospital quality 

data as a condition for receiving the full 

annual payment update increase. 

• Proposed changes in the payment 

adjustment for low-volume hospitals. 

• Proposed IME adjustment for 

TEFRA hospitals that are converting to 

IPPS hospitals, and IME FTE resident 

caps for urban hospitals that are granted 

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rural reclassification and then withdraw 

that rural classification. 

• Proposed changes to implement 

section 951 of Pub. L. 108–173 relating 

to the provision of patient stay/SSI days 

data maintained by CMS to hospitals for 

the purpose of determining their DSH 

percentage. 

• Proposed changes relating to 

hospitals’ geographic classifications, 

including multicampus hospitals and 

urban group hospital reclassifications. 

• Proposed changes and clarifications 

relating to GME, including GME initial 

residency period limitation, new 

teaching hospitals’ participation in 

Medicare GME affiliated groups, and the 

GME FTE cap adjustment for rural 

hospitals; 

• Solicitation of public comments on 

possible changes in requirements for 

provider-based entities relating to 

entities the location requirements for 

certain neonatal intensive care units as 

off-campus facilities; 

• Discussion of the second year of 

implementation of the Rural 

Community Hospital Demonstration 

Program; and 

• Clarification of the definition of a 

hospital as it relates to ‘‘specialty 

hospitals’’ participating in the Medicare 

program. 

5. PPS for Capital-Related Costs 

In section VI. of this proposed rule, 

we are not proposing any policy 

changes to the capital-related 

prospective payment system. For the 

readers’ benefit, we discuss the payment 

policy requirements for capital-related 

costs and capital payments to hospitals. 

6. Proposed Changes for Hospitals and 

Hospital Units Excluded From the IPPS 

In section VII. of this proposed rule, 

we discuss the proposed revisions and 

clarifications concerning excluded 

hospitals and hospital units, proposed 

policy changes relating to continued 

participation by CAHs located in 

counties redesignated under section 

1886(d)(8)(B) of the Act (Lugar 

counties), and proposed policy changes 

relating to designation of CAHs as 

necessary providers. 

7. Proposed Changes in Payment for 

Blood Clotting Factor 

In section VIII of this proposed rule, 

we discuss the proposed change in 

payment for blood clotting factor 

administered to inpatients with 

hemophilia for FY 2006. 

8. Determining Prospective Payment 

Operating and Capital Rates and Rate-ofIncrease Limits 

In the Addendum to this proposed 

rule, we set forth proposed changes to 

the amounts and factors for determining 

the FY 2006 prospective payment rates 

for operating costs and capital-related 

costs. We also establish the proposed 

threshold amounts for outlier cases. In 

addition, we address the proposed 

update factors for determining the rateof-increase limits for cost reporting 

periods beginning in FY 2006 for 

hospitals and hospital units excluded 

from the PPS. 

9. Impact Analysis 

In Appendix A of this proposed rule, 

we set forth an analysis of the impact 

that the proposed changes would have 

on affected hospitals. 

10. Recommendation of Update Factor 

for Hospital Inpatient Operating Costs 

In Appendix B of this proposed rule, 

as required by sections 1886(e)(4) and 

(e)(5) of the Act, we provided our 

recommendations of the appropriate 

percentage changes for FY 2006 for the 

following: 

• A single average standardized 

amount for all areas for hospital 

inpatient services paid under the IPPS 

for operating costs (and hospital-specific 

rates applicable to SCHs and MDHs). 

• Target rate-of-increase limits to the 

allowable operating costs of hospital 

inpatient services furnished by hospitals 

and hospital units excluded from the 

IPPS. 

11. Discussion of Medicare Payment 

Advisory Commission 

Recommendations 

Under section 1805(b) of the Act, the 

Medicare Payment Advisory 

Commission (MedPAC) is required to 

submit a report to Congress, no later 

than March 1 of each year, in which 

MedPAC reviews and makes 

recommendations on Medicare payment 

policies. MedPAC’s March 2005 

recommendation concerning hospital 

inpatient payment policies addressed 

only the update factor for inpatient 

hospital operating costs and capitalrelated costs under the IPPS and for 

hospitals and distinct part hospital units 

excluded from the IPPS. This 

recommendation is addressed in 

Appendix B of this proposed rule. 

MedPAC issued a second Report to 

Congress: Physician-Owned Specialty 

Hospitals, March 2005, which addressed 

other issues relating to Medicare 

payments to hospitals for inpatient 

services. The recommendations on these 

issues from this second report are 

addressed in section IX. of this 

preamble. For further information 

relating specifically to the MedPAC 

March 2005 reports or to obtain a copy 

of the reports, contact MedPAC at (202) 

220–3700 or visit MedPAC’s Web site at: 

http://www.medpac.gov. 

II. Proposed Changes to DRG 

Classifications and Relative Weights 

A. Background 

Section 1886(d) of the Act specifies 

that the Secretary shall establish a 

classification system (referred to as 

DRGs) for inpatient discharges and 

adjust payments under the IPPS based 

on appropriate weighting factors 

assigned to each DRG. Therefore, under 

the IPPS, we pay for inpatient hospital 

services on a rate per discharge basis 

that varies according to the DRG to 

which a beneficiary’s stay is assigned. 

The formula used to calculate payment 

for a specific case multiplies an 

individual hospital’s payment rate per 

case 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 at least 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 

proposed changes to the DRG 

classification system and the 

recalibration of the DRG weights for 

discharges occurring on or after October 

1, 2005, are discussed below. 

B. DRG Reclassifications 

(If you choose to comment on issues 

in this section, please include the 

caption ‘‘DRG Reclassifications’’ at the 

beginning of your comment.) 

1. General 

Cases are classified into DRGs for 

payment under the IPPS based on the 

principal diagnosis, up to eight 

additional diagnoses, and up to six 

procedures performed during the stay. 

In a small number of DRGs, 

classification is also based on the age, 

sex, and discharge status of the patient. 

The diagnosis and procedure 

information is reported by the hospital 

using codes from the International 

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Classification of Diseases, Ninth 

Revision, Clinical Modification (ICD–9–

CM). 

The process of forming the DRGs was 

begun by dividing all possible principal 

diagnoses into mutually exclusive 

principal diagnosis areas referred to as 

Major Diagnostic Categories (MDCs). 

The MDCs were formed by physician 

panels as the first step toward ensuring 

that the DRGs would be clinically 

coherent. The diagnoses in each MDC 

correspond to a single organ system or 

etiology and, in general, are associated 

with a particular medical specialty. 

Thus, in order to maintain the 

requirement of clinical coherence, no 

final DRG could contain patients in 

different MDCs. Most MDCs are based 

on a particular organ system of the 

body. For example, MDC 6 is Diseases 

and Disorders of the Digestive System. 

This approach is used because clinical 

care is generally organized in 

accordance with the organ system 

affected. However, some MDCs are not 

constructed on this basis because they 

involve multiple organ systems (for 

example, MDC 22 (Burns)). For FY 2005, 

cases are assigned to one of 519 DRGs 

in 25 MDCs. The table below lists the 25 

MDCs. 

In general, cases are assigned to an 

MDC based on the patient’s principal 

diagnosis before assignment to a DRG. 

However, for FY 2005, there are nine 

DRGs to which cases are directly 

assigned on the basis of ICD–9–CM 

procedure codes. These DRGs are for 

heart transplant or implant of heart 

assist systems, liver and/or intestinal 

transplants, bone marrow, lung, 

simultaneous pancreas/kidney, and 

pancreas transplants and for 

tracheostomies. Cases are assigned to 

these DRGs before they are classified to 

an MDC. The table below lists the 

current nine pre-MDCs. 


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Once the MDCs were defined, each 

MDC was evaluated to identify those 

additional patient characteristics that 

would have a consistent effect on the 

consumption of hospital resources. 

Since the presence of a surgical 

procedure that required the use of the 

operating room would have a significant 

effect on the type of hospital resources 

used by a patient, most MDCs were 

initially divided into surgical DRGs and 

medical DRGs. Surgical DRGs are based 

on a hierarchy that orders operating 

room (O.R.) procedures or groups of 

O.R. procedures by resource intensity. 

Medical DRGs generally are 

differentiated on the basis of diagnosis 

and age (less than or greater than 17 

years of age). Some surgical and medical 

DRGs are further differentiated based on 

the presence or absence of a 

complication or a comorbidity (CC). 

Generally, nonsurgical procedures 

and minor surgical procedures that are 

not usually performed in an operating 

room are not treated as O.R. procedures. 

However, there are a few non-O.R. 

procedures that do affect DRG 

assignment for certain principal 

diagnoses, for example, extracorporeal 

shock wave lithotripsy for patients with 

a principal diagnosis of urinary stones. 

Once the medical and surgical classes 

for an MDC were formed, each class of 

patients was evaluated to determine if 

complications, comorbidities, or the 

patient’s age would consistently affect 

the consumption of hospital resources. 

Physician panels classified each 

diagnosis code based on whether the 

diagnosis, when present as a secondary 

condition, would be considered a 

substantial complication or 

comorbidity. 

A substantial complication or 

comorbidity was defined as a condition, 

which because of its presence with a 

specific principal diagnosis, would 

cause an increase in the length of stay 

by at least one day in at least 75 percent 

of the patients. Each medical and 

surgical class within an MDC was tested 

to determine if the presence of any 

substantial comorbidities or 

complications would consistently affect 

the consumption of hospital resources. 

The actual process of forming the 

DRGs was, and continues to be, highly 

iterative, involving a combination of 

statistical results from test data 

combined with clinical judgment. In 

deciding whether to create a separate 

DRG, we consider whether the resource 

consumption and clinical characteristics 

of the patients with a given set of 

conditions are significantly different 

than the remaining patients in the DRG. 

We evaluate patient care costs using 

average charges and length of stay as 

proxies for costs and rely on the 

judgment of our medical officers to 

decide whether patients are distinct or 

clinically similar to other patients in the 

DRG. In evaluating resource costs, we 

consider both the absolute and 

percentage differences in average 

charges between the cases we are 

selecting for review and the remainder 

of cases in the DRG. We also consider 

variation in charges within these 

groups; that is, whether observed 

average differences are consistent across 

patients or attributable to cases that are 

extreme in terms of charges or length of 

stay, or both. Further, we also consider 

the number of patients who will have a 

given set of characteristics and generally 

prefer not to create a new DRG unless 

it will include a substantial number of 

cases. As we explain in more detail in 

section IX. of this preamble, MedPAC 

has made a number of recommendations 

regarding the DRG system. As part of 

our review and analysis of MedPAC’s 

recommendations, we will consider 

whether to establish guidelines for 

making DRG reclassification decisions. 

A patient’s diagnosis, procedure, 

discharge status, and demographic 

information is fed into the Medicare 

claims processing systems and subjected 

to a series of automated screens called 

the Medicare Code Editor (MCE). The 

MCE screens are designed to identify 

cases that require further review before 

classification into a DRG. 

After patient information is screened 

through the MCE and any further 

development of the claim is conducted, 

the cases are classified into the 

appropriate DRG by the Medicare 

GROUPER software program. 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, for a limited 

number of DRGs, demographic 

information (that is, sex, age, and 

discharge status). 

After cases are screened through the 

MCE and assigned to a DRG by the 

GROUPER, the PRICER software 

calculates a base DRG payment. The 

PRICER calculates the payments for 

each case covered by the IPPS based on 

the DRG relative weight and additional 

factors associated with each hospital, 

such as IME and DSH adjustments. 

These additional factors increase the 

payment amount to hospitals above the 

base DRG payment. 

The records for all Medicare hospital 

inpatient discharges are maintained in 

the Medicare Provider Analysis and 


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Review (MedPAR) file. The data in this 

file are used to evaluate possible DRG 

classification changes and to recalibrate 

the DRG weights. However, in the July 

30, 1999 IPPS final rule (64 FR 41500), 

we discussed a process for considering 

non-MedPAR data in the recalibration 

process. In order for us to consider 

using particular non-MedPAR data, we 

must have sufficient time to evaluate 

and test the data. The time necessary to 

do so depends upon the nature and 

quality of the non-MedPAR data 

submitted. Generally, however, a 

significant sample of the non-MedPAR 

data should be submitted by midOctober for consideration in 

conjunction with the next year’s 

proposed rule. This allows us time to 

test the data and make a preliminary 

assessment as to the feasibility of using 

the data. Subsequently, a complete 

database should be submitted by early 

December for consideration in 

conjunction with the next year’s 

proposed rule. 

Many of the changes to the DRG 

classifications are the result of specific 

issues brought to our attention by 

interested parties. We encourage 

individuals with concerns about DRG 

classifications to bring those concerns to 

our attention in a timely manner so they 

can be carefully considered for possible 

inclusion in the next proposed rule and 

if included, may be subjected to public 

review and comment. Therefore, similar 

to the timetable for interested parties to 

submit non-MedPAR data for 

consideration in the DRG recalibration 

process, concerns about DRG 

classification issues should be brought 

to our attention no later than early 

December in order to be considered and 

possibly included in the next annual 

proposed rule updating the IPPS. 

The changes we are proposing to the 

DRG classification system for FY 2006 

for the FY 2006 GROUPER, version 23.0 

and to the methodology used to 

recalibrate the DRG weights are set forth 

below. Unless otherwise noted in this 

proposed rule, our DRG analysis is 

based on data from the December 2004 

update of the FY 2004 MedPAR file, 

which contains hospital bills received 

through December 31, 2004 for 

discharges in FY 2004. 

2. Pre-MDC: Intestinal Transplantation 

In the FY 2005 IPPS final rule (69 FR 

48976), we moved intestinal 

transplantation cases that were assigned 

to ICD–9–CM procedure code 46.97 

(Transplant of intestine) out of DRG 148 

(Major Small and Large Bowel 

Procedures with CC) and DRG 149 

(Major Small and Large Bowel 

Procedures Without CC) and into DRG 

480 (Liver Transplant). We also changed 

the title for DRG 480 to ‘‘Liver 

Transplant and/or Intestinal 

Transplant.’’ We moved these cases out 

of DRGs 148 and 149 because our 

analysis demonstrated that the average 

charges for intestinal transplants are 

significantly higher than the average 

charges for other cases in these DRGs. 

We stated at that time that we would 

continue to monitor these cases. 

Based on our review of the FY 2004 

MedPAR data, we found 959 cases 

assigned to DRG 480 with overall 

average charges of approximately 

$165,622. There were only three cases 

involving an intestinal transplant alone 

and one case in which both an intestinal 

transplant and a liver transplant were 

performed. The average charges for the 

intestinal transplant cases ($138,922) 

were comparable to the average charges 

for the liver transplant cases ($165,314), 

while the remaining combination of an 

intestinal transplant and a liver 

transplant case had much higher 

charges ($539,841), and would be paid 

as an outlier case. Therefore, we are not 

proposing any DRG modification for 

intestinal transplantation cases at this 

time. 

We note that an institution that 

performs intestinal transplantation, in 

correspondence to us written following 

the publication of the FY 2005 IPPS 

final rule, agreed with our decision to 

move cases assigned to code 46.97 to 

DRG 480. 

3. MDC 1 (Diseases and Disorders of the 

Nervous System) 

a. Strokes 

In 1996, the Food and Drug 

Administration (FDA) approved the use 

of tissue plasminogen activator (tPA), 

one type of thrombolytic agent that 

dissolves blood clots. In 1998, the ICD–

9–CM Coordination and Maintenance 

Committee created code 99.10 (Injection 

or infusion of thrombolytic agent) in 

order to be able to uniquely identify the 

administration of thrombolytic agents. 

Studies have shown that tPA can be 

effective in reducing the amount of 

damage the brain sustains during an 

ischemic stroke, which is caused by 

blood clots that block blood flow to the 

brain. The use of tPA is approved for 

patients who have blood clots in the 

brain, but not for patients who have a 

bleeding or hemorrhagic stroke. 

Thrombolytic therapy has been shown 

to be most effective when used within 

the first 3 hours after the onset of a 

stroke, and it is contraindicated in 

hemorrhagic stroke. The presence or 

absence of code 99.10 does not currently 

influence DRG assignment. Since code 

99.10 became effective, we have been 

monitoring the DRGs and cases in 

which this code can be found, 

particularly with respect to cardiac and 

stroke DRGs. 

Last year, we met with representatives 

from several hospital stroke centers who 

recommended modification of the 

existing stroke DRGs 14 (Intracranial 

Hemorrhage or Cerebral Infarction) and 

15 (Nonspecific CVA and Precerebral 

Occlusion Without Infarction) by using 

the administration of tPA as a proxy to 

identify patients who have severe 

strokes. The representatives stated that 

using tPA as a proxy for the more 

severely ill stroke patient would 

recognize the higher charges these cases 

generate because of their higher hospital 

resource utilization. 

The stroke representatives made two 

suggestions concerning DRGs 14 and 15. 

First, they proposed modifying DRG 14 

by renaming it ‘‘Ischemic Stroke 

Treatment with a Reperfusion Agent,’’

and including only those cases 

containing code 99.10. The remainder of 

stroke cases where the patient was not 

treated with a reperfusion agent would 

be included in DRG 15, which would be 

renamed ‘‘Hemorrhagic Stroke or 

Ischemic Stroke without a Reperfusion 

Agent.’’ Hemorrhagic stroke cases now 

found in DRG 14 that are not treated 

with a reperfusion agent would migrate 

to DRG 15. 

The second suggestion was to leave 

DRGs 14 and 15 as they currently exist, 

and create a new DRG, with a 

recommended title ‘‘Ischemic Stroke 

Treatment with a Reperfusion Agent.’’

This suggested DRG would only include 

strokes caused by clots, not by 

hemorrhages, and would include the 

administration of tPA, identified by 

procedure code 99.10. 

We have examined the MedPAR data 

for the cases in DRGs 14 and 15, and 

have divided the cases based on the 

presence of a principal diagnosis of 

hemorrhage or occlusive ischemia, and 

the presence of procedure code 99.10. 

The following table displays the results: 

23316 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

The above table shows that the 

average standardized charges for cases 

treated with a reperfusion agent are 

more than $16,000 and $10,000 higher 

than all other cases in DRGs 14 and 15, 

respectively. While these data suggest 

that patients treated with a reperfusion 

agent are more expensive than all other 

stroke patients, this conclusion is based 

on a small number of cases. At this time, 

we are not proposing a change to the 

stroke DRGs because of this concern. 

However, we believe it is possible that 

more patients are being treated with a 

reperfusion agent than indicated by our 

data because the presence of code 99.10 

does not affect DRG assignment and 

may be underreported. 

We invite public comment on the 

changes to DRGs 14 and 15 suggested by 

the hospital representatives. In addition, 

we are interested in public comment on 

the number of patients currently being 

treated with a reperfusion agent as well 

as the potential costs of these patients 

relative to others with strokes that are 

also included in DRGs 14 and 15. 

b. Unruptured Cerebral Aneurysms 

In the FY 2004 IPPS final rule (68 FR 

45353), we created DRG 528 

(Intracranial Vascular Procedures With a 

Principal Diagnosis of Hemorrhage) in 

MDC 1. We received a comment at that 

time that suggested we create another 

DRG for intracranial vascular 

procedures for unruptured cerebral 

aneurysms. For the FY 2004 IPPS final 

rule (68 FR 45353) and the FY 2005 

IPPS final rule (69 FR 48957), we 

evaluated the data for cases in the 

MedPAR file involving unruptured 

cerebral aneurysms assigned to DRG 1 

(Craniotomy Age >17 With CC) and DRG 

2 (Craniotomy Age >17 Without CC) and 

concluded that the average charges were 

consistent with those for other cases 

found in DRGs 1 and 2. Therefore, we 

did not propose a change to the DRG 

assignment for unruptured cerebral 

aneurysms. 

We have reviewed the latest data for 

unruptured cerebral aneurysms cases. In 

our analysis of the FY 2004 MedPAR 

data, we found 1,136 unruptured 

cerebral aneurysm cases assigned to 

DRG 1 and 964 unruptured cerebral 

aneurysm cases assigned to DRG 2. 

Although the average charges for the 

unruptured cerebral aneurysm cases in 

DRG 1 ($53,455) and DRG 2 ($34,028) 

were slightly higher than the average 

charges for all cases in DRG 1 ($51,466) 

and DRG 2 ($30,346), we do not believe 

these differences are significant enough 

to warrant a change in these two DRGs 

at this time. Therefore, we are not 

proposing a change in the structure of 

these DRGs relating to unruptured 

cerebral aneurysm cases for FY 2006. 

4. MDC 5 (Diseases and Disorders of the 

Circulatory System) 

a. Automatic Implantable Cardioverter/ 

Defibrillator 

As part of our annual review of DRGs, 

for FY 2006, we performed a review of 

cases in the FY 2004 MedPAR file 

involving the implantation of a 

defibrillator in the following DRGs: 

DRG 515 (Cardiac Defibrillator 

Implant Without Cardiac 

Catheterization). 

DRG 535 (Cardiac Defibrillator 

Implant With Cardiac Catheterization 

With Acute Myocardial Infarction, Heart 

Failure, or Shock). 

DRG 536 (Cardiac Defibrillator 

Implant With Cardiac Catheterization 

Without Acute Myocardial Infarction, 

Heart Failure, or Shock). 

While conducting our review, we 

noted that there had been considerable 

comments from hospital coders on code 

37.26 (Cardiac electrophysiologic 

stimulation and recording studies 

(EPS)), which is included in these 

DRGs. These comments from hospital 

coders were directed at both CMS and 

the American Hospital Association. The 

procedure codes for these three DRGs 

describe the procedures that are 

considered to be a cardiac 

catheterization. Code 37.26 is classified 

as a cardiac catheterization within these 

DRGs. Therefore, the submission of code 


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37.26 affects the DRG assignment for 

defibrillator cases and leads to the 

assignment of DRGs 535 or 536. When 

a cardiac catheterization is performed, 

the case is assigned to DRGs 535 or 536, 

depending on whether or not the patient 

also had an acute myocardial infarction, 

heart failure, or shock. The following 

chart shows the number of cases in each 

DRG, along with their average length of 

stay and average charges, found in the 

data: 

We have received a number of 

questions from hospital coders 

regarding the correct use of code 37.26. 

There is considerable confusion about 

whether or not code 37.26 should be 

reported when the procedure is 

performed as part of the defibrillator 

implantation. Currently, the ICD–9–CM 

instructs the coder not to report code 

37.26 when a defibrillator is inserted. 

There is an inclusion term under the 

defibrillator code 37.94 (Implantation or 

replacement of automatic cardioverter/ 

defibrillator, total system [AICD]) which 

states that EPS is included in code 

37.94. We discussed modifying this 

instruction at the October 7–8, 2004 

meeting of the ICD–9–CM Coordination 

and Maintenance Committee. We 

received a number of comments 

opposing a modification to the use of 

code 37.26 to also allow it to be reported 

with an AICD insertion. A report of this 

meeting can be found on the Web site: 

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

paymentsystem/icd9. 

We performed an analysis of cases 

within DRGs 535 and 536 with cardiac 

catheterization and with and without 

code 37.26 and with code 37.26 only 

reported without cardiac catheterization 

and found the following: 

The data show that when code 37.26 

is the only procedure reported from the 

list of cardiac catheterizations, the 

average charges and the average length 

of stay are considerably lower. For 

example, the average standardized 

charges for a defibrillator implant with 

only an EPS are $85,390.88 in DRG 536, 

while the average standardized charges 

for DRG 536 with a cardiac 

catheterization, but not an EPS, are 

$110,493.86. The average standardized 

charges for all cases in DRG 536 are 

$94,453.62. The data show similar 

findings for DRG 535, with lower 

lengths of stay and average charges 

when the only code reported from the 

cardiac catheterization list is an EPS. 

When we also consider that there may 

be some coding problems in the use of 

code 37.26, we believe it is appropriate 

to propose a modification to these 

DRGs. 

Data reflected in the chart above show 

that the average standardized charges 

for DRG 515 were $83,659.76. These 

average charges are closer to those in 

DRG 536 with code 37.26 and without 

any other cardiac catheterization code 

reported. While the cases in DRG 535 

with code 37.26 and without a cardiac 

catheterization have higher average 

charges than the average charges for 

cases in DRG 515, these cases have 

much lower average charges than the 

average charges for overall cases in DRG 

535. For these reasons, we are proposing 

to remove code 37.26 from the list of 

cardiac catheterizations for DRGs 535 

and 536. If a defibrillator is implanted 

and an EPS is performed with no other 

type of cardiac catheterization, the case 

would be assigned to DRG 515. 

CMS issued a National Coverage 

Determination for implantable 

cardioverter defibrillators, effective 

January 27, 2005, that expands coverage 

and requires, in certain cases, that 

patient data be reported when the 

defibrillator is implanted for the clinical 

indication of primary prevention of 

sudden cardiac death. The submission 

of data on patients receiving an 

implantable cardioverter defibrillator for 

primary prevention to a data collection 

system is needed for the determination 

that the implantable cardioverter 


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23318 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

defibrillator is reasonable and necessary 

and for quality improvement. These 

data will be made available in some 

form to providers and practitioners to 

inform their decisions, monitor 

performance quality, and benchmark 

and identify best practices. We made a 

temporary registry available for use 

when the policy became effective and 

used the Quality Net Exchange for data 

submission because Medicareparticipating hospitals already use the 

Exchange to report data. 

We intend to transition from the 

temporary registry using the Quality Net 

Exchange to a more sophisticated 

follow-on registry that will have the 

ability to collect longitudinal data. 

Some providers have suggested that 

CMS increase reimbursement for 

implantable cardioverter defibrillators 

to compensate the provider for reporting 

data. ICD data reporting includes 

elements of patient demographics, 

clinical characteristics and indications, 

medications, provider information, and 

complications. Since these data 

elements are commonly found in patient 

medical records, it is CMS’ expectation 

that these data are readily available to 

the individuals abstracting and 

reporting data. Therefore, we believe 

that increased reimbursement is not 

needed at this time. 

b. Coronary Artery Stents 

In the FY 2005 IPPS final rule (69 FR 

48971 through 48974), we addressed 

two comments from industry 

representatives about the DRG 

assignments for coronary artery stents. 

These commenters had expressed 

concern about whether the 

reimbursement for stents is adequate, 

especially for insertion of multiple 

stents. They also expressed concern 

about whether the current DRG 

structure represents the most clinically 

coherent classification of stent cases. 

The current DRG structure 

incorporates stent cases into the 

following two pairs of DRGs, depending 

on whether bare metal or drug-eluting 

stents are used and whether acute 

myocardial infarction (AMI) is present: 

• DRG 516 (Percutaneous 

Cardiovascular Procedures with AMI). 

• DRG 517 (Percutaneous 

Cardiovascular Procedures with 

Nondrug-Eluting Stent without AMI). 

• DRG 526 (Percutaneous 

Cardiovascular Procedures with DrugEluting Stent with AMI). 

• DRG 527 (Percutaneous 

Cardiovascular Procedures with DrugEluting Stent without AMI). 

The commenters presented two 

recommendations for refinement and 

restructuring of the current coronary 

stent DRGs. One of the 

recommendations involved 

restructuring these DRGs to create two 

additional stent DRGs that are closely 

patterned after the existing pairs, and 

would reflect insertion of multiple 

stents with and without AMI. The 

commenters recommended 

incorporating either stenting code 36.06 

(Insertion of nondrug-eluting coronary 

artery stent(s)) or code 36.07 (Insertion 

of drug-eluting coronary artery stent(s)) 

when they are reported along with code 

36.05 (Multiple vessel percutaneous 

transluminal coronary angioplasty 

[PTCA] or coronary atherectomy 

performed during the same operation, 

with or without mention of 

thrombolytic agent). The commenter’s 

first concern was that hospitals may be 

steering patients toward coronary artery 

bypass graft surgery in place of stenting 

in order to avoid significant financial 

losses due to what it considered the 

inadequate reimbursement for inserting 

multiple stents. 

In our response to comments in the 

FY 2005 IPPS final rule, we indicated 

that it was premature to act on this 

recommendation because the current 

coding structure for coronary artery 

stents cannot distinguish cases in which 

multiple stents are inserted from those 

in which only a single stent is inserted. 

Current codes are able to identify 

performance of PTCA in more than one 

vessel by use of code 36.05. However, 

while this code indicates that PTCA was 

performed in more than one vessel, its 

use does not reflect the exact number of 

procedures performed or the exact 

number of vessels treated. Similarly, 

when codes 36.06 and 36.07 are used, 

they document the insertion of at least 

one stent. However, these stenting codes 

do not identify how many stents were 

inserted in a procedure, nor distinguish 

insertion of a single stent from insertion 

of multiple stents. Even the use of one 

of the stenting codes in conjunction 

with multiple-PTCA code 36.05 does 

not distinguish insertion of a single 

stent from multiple stents. The use of 

code 36.05 in conjunction with code 

36.06 or code 36.07 indicates only 

performance of PTCA in more than one 

vessel, along with insertion of at least 

one stent. The precise numbers of 

PTCA-treated vessels, the number of 

vessels into which stents were inserted, 

and the total number of stents inserted 

in all treated vessels cannot be 

determined. Therefore, the capabilities 

of the current coding structure do not 

permit the distinction between single 

and multiple vessel stenting that would 

be required under the recommended 

restructuring of the coronary stent 

DRGs. 

We agree that the DRG classification 

of cases involving coronary stents must 

be clinically coherent and provide for 

adequate reimbursement, including 

those cases requiring multiple stents. 

For this reason, we created four new 

ICD–9–CM codes identifying multiple 

stent insertion (codes 00.45, 00.46, 

00.47, and 00.48) and four new codes 

identifying multiple vessel treatment 

(codes 00.40, 00.41, 00.42, and 00.43) at 

the October 7, 2004 ICD–9–CM 

Coordination and Maintenance 

Committee Meeting. These eight new 

codes can be found in Table 6B of this 

proposed rule. We have worked closely 

with the coronary stent industry and the 

clinical community to identify the most 

logical code structure to identify new 

codes for both multiple vessel and 

multiple stent use. Effective October 1, 

2005, code 36.05 will be deleted and the 

eight new codes will be used in its 

place. Coders are encouraged to use as 

many codes as necessary to describe 

each case, using one code to describe 

the angioplasty or atherectomy, and one 

code each for the number of vessels 

treated and the number of stents 

inserted. Coders are encouraged to 

record codes accurately, as these data 

will potentially be the basis for future 

DRG restructuring. While we agree that 

use of multiple vessel and stent codes 

will provide useful information in the 

future on hospital costs associated with 

percutaneous coronary procedures, we 

believe it remains premature to proceed 

with a restructuring of the current 

coronary stent DRGs on the basis of the 

number of vessels treated or the number 

of stents inserted, or both, in the 

absence of data reflecting use of this 

new coding structure. 

The commenter’s second 

recommendation was that we 

distinguish ‘‘complex’’ from 

‘‘noncomplex’’ cases in the stent DRGs 

by expanding the higher weighted DRGs 

(516 and 526) to include conditions 

other than AMI. The commenter 

recommended recognizing certain 

comorbid and complicating conditions, 

including hypertensive renal failure, 

congestive heart failure, diabetes, 

arteriosclerotic cardiovascular disease, 

cerebrovascular disease, and certain 

procedures such as multiple vessel 

angioplasty or atherectomy (as 

evidenced by the presence of procedure 

code 36.05), as indicators of complex 

cases for this purpose. Specifically, the 

commenters recommended replacing 

the current structure with the following 

four DRGs: 

• Recommended restructured DRG 

516 (Complex percutaneous 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23319 

cardiovascular procedures with nondrug-eluting stents). 

• Recommended restructured DRG 

517 (Noncomplex percutaneous 

cardiovascular procedures with nondrug-eluting stents). 

• Recommended restructured DRG 

526 (Complex percutaneous 

cardiovascular procedures with drugeluting stents). 

• Recommended restructured DRG 

527 (Noncomplex percutaneous 

cardiovascular procedures with drugeluting stents). 

The commenter argued that this 

structure would provide an 

improvement in both clinical and 

resource coherence over the current 

structure that classifies cases according 

to the type of stent inserted and the 

presence or absence of AMI alone, 

without considering other complicating 

conditions. The commenter also 

presented an analysis, based on 

previous MedPAR data, that evaluated 

charges and lengths of stay for cases 

with expected high resource use and 

reclassified cases into its recommended 

new structure of paired ‘‘complex’’ and 

‘‘noncomplex’’ DRGs. The commenter’s 

analysis showed some evidence of 

clinical and resource coherence in the 

recommended DRG structure. However, 

we did not adopt the proposal in the FY 

2005 IPPS final rule. First, the data 

presented by the commenter still 

represented preliminary experience 

under a relatively new DRG structure. 

Second, the analysis did not reveal 

significant gains in resource coherence 

compared to existing DRGs for stenting 

cases. Therefore, we were reluctant to 

adopt this approach because of 

comments and concern about whether 

the overall level of payment in the 

coronary stent DRGs was adequate. 

However, we indicated that this issue 

deserved further study and 

consideration, and that we would 

conduct an analysis of this 

recommendation and other approaches 

to restructuring these DRGs with 

updated data in the FY 2006 proposed 

rule. 

This year, we have analyzed the 

MedPAR data to determine the impact 

of certain secondary diagnoses or 

complicating conditions on the four 

DRGs cited above. Specifically, we 

examined the data in DRGs 516, 517, 

526, and 527, based on the presence of 

coronary stents (codes 36.06 and 36.07) 

and the following additional diagnoses: 

• Congestive heart failure 

(represented by codes 398.91 

(Rheumatic heart failure (congestive)), 

402.01 (Hypertensive heart disease, 

malignant, with heart failure), 402.11, 

(Hypertensive heart disease, benign, 

with heart failure), 402.91 (Hypertensive 

heart disease, unspecified, with heart 

failure), 404.01 (Hypertensive heart and 

renal disease, malignant, with heart 

failure), 404.03 (Hypertensive heart and 

renal disease, malignant, with heart 

failure and renal failure), 404.11 

(Hypertensive heart and renal disease, 

benign, with heart failure), 404.13 

(Hypertensive heart and renal disease, 

benign, with heart failure and renal 

failure), 404.91 (Hypertensive heart and 

renal disease, unspecified, with heart 

failure), 404.93 (Hypertensive heart and 

renal disease, unspecified, with heart 

failure and renal failure), 428.0 

(Congestive heart failure, unspecified), 

and 428.1 (Left heart failure)). 

• Arteriosclerotic cardiovascular 

disease (represented by code 429.2 

(Cardiovascular disease, unspecified)). 

• Cerebrovascular disease 

(represented by codes 430.0 

(Subarachnoid hemorrhage), 431.0 

(Intracerebral hemorrhage), 432.0 

(Nontraumatic extradural hemorrhage), 

432.1, Subdural hemorrhage, 432.9, 

(Unspecified intracranial hemorrhage), 

433.01 (Occlusion and stenosis of 

basilar artery, with cerebral infarction), 

433.11 (Occlusion and stenosis of 

carotid artery, with cerebral infarction), 

433.21 (Occlusion and stenosis of 

vertebral artery, with cerebral 

infarction), 433.31 (Occlusion and 

stenosis of multiple and bilateral 

precerebral arteries, with cerebral 

infarction), 433.81 (Occlusion and 

stenosis of other specified precerebral 

artery, with cerebral infarction), 434.01 

(Cerebral thrombosis with cerebral 

infarction), 434.11 (Cerebral embolism 

with cerebral infarction), 434.91 

(Cerebral artery occlusion with cerebral 

infarction, unspecified), 436.0 (Acute, 

but ill-defined, cerebrovascular 

disease)). 

• Secondary diagnosis of acute 

myocardial infarction (represented by 

codes 410.01 (Acute myocardial 

infarction of anterolateral wall, initial 

episode of care), 410.11 (Acute 

myocardial infarction of other anterior 

wall, initial episode of care), 410.21 

(Acute myocardial infarction of 

inferolateral wall, initial episode of 

care), 410.31 (Acute myocardial 

infarction of inferoposterior wall, initial 

episode of care), 410.41 (Acute 

myocardial infarction of other inferior 

wall, initial episode of care), 410.51 

(Acute myocardial infarction of other 

lateral wall, initial episode of care), 

410.61 (True posterior wall infarction, 

initial episode of care), 410.71 

(Subendocardial infarction, initial 

episode of care), 410.81 (Acute 

myocardial infarction of other specified 

sites, initial episode of care), 410.91 

(Acute myocardial infarction of 

unspecified site, initial episode of 

care)). 

• Renal failure (represented by codes 

403.01 (Hypertensive renal disease, 

malignant, with renal failure), 403.11 

(Hypertensive renal disease, benign, 

with renal failure), 403.91 (Hypertensive 

renal disease, unspecified, with renal 

failure), 585.0 (Chronic renal failure), 

V42.0 (Organ or tissue replaced by 

transplant, kidney), V45.1 (Renal 

dialysis status), V56.0 (Extracorporeal 

dialysis), V56.1 (Fitting and adjustment 

of extracorporeal dialysis catheter), 

V56.2 (Fitting and adjustment of 

peritoneal dialysis catheter)). Any renal 

failure with congestive heart failure will 

be captured in the 404.xx codes listed 

above. 

We reviewed the cases in the four 

coronary stent DRGs and found that 

most of the additional or ‘‘complicated’’

cases did, in fact, have higher average 

charges in most instances. However, 

these results could potentially be 

duplicated for many DRGs, or sets of 

DRGs, within the PPS structure. That is, 

cases with selected complicating factors 

will tend to have higher average lengths 

of stay and average charges than cases 

without those complicating factors. 

Since cases with the selected 

complicating factors necessarily contain 

sicker patients, longer lengths of stay 

and higher average charges are to be 

expected. For example, cases in which 

patients with a cardiac condition also 

have renal failure are quite likely to 

consume higher resources than patients 

only with a cardiac condition. In 

addition, selectively recognizing the 

recommended secondary diagnoses or 

complicating conditions raises some 

issues related to the logic and structural 

integrity of the DRG system. Generally, 

we have taken into account the higher 

costs of cases with complications by 

maintaining a general list of 

comorbidities and complications (the 

CC) list), and, where appropriate, 

distinguishing pairs of DRGs by ‘‘with 

and without CCs.’’ (This system also 

specifies exclusions from each pair, to 

account for cases where a condition on 

the CC list is an expected and normal 

constituent of the diagnoses reflected in 

the paired DRGs.) In order to maintain 

the basic DRG body-system structure, 

we have not employed special lists of 

procedures and diagnoses from one 

MDC to make determinations about the 

structure of DRGs in another MDC. The 

recommended restructuring of the 

coronary stent DRGs is inconsistent 

with this principle and may create a 

new precedent of selecting specific 

comorbidities and complications to 

restructure DRGs. For example, the 

23320 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

presence of code 403.11 (Hypertensive 

renal disease, malignant, with renal 

failure) may distinguish cases with 

higher average charges, but the same 

argument could be raised for many other 

procedures across other MDCs. 

Rather than establishing such a 

precedent, we are proposing to 

restructure the coronary stent DRGs on 

the basis of the standard CC list to 

differentiate cases that require greater 

resources. We believe this list to be 

more inclusive of true comorbid or 

complicating conditions than selection 

of specific secondary diagnosis codes. 

Therefore, restructuring these DRGs on 

this basis would result in a logical 

arrangement of cases with regard to both 

clinical coherence and resource 

consumption. We have compared the 

existing CC list with the list of the codes 

recommended by the commenter as 

secondary diagnoses. All of the 

recommended codes already appear on 

the CC list except for codes 429.2, 432.9, 

V56.1, and V56.2. Code 429.2 represents 

a very vague diagnosis (arteriosclerotic 

cardiovascular disease (ASCVD)). Code 

432.9 represents a nonspecific principal 

diagnosis that is rejected by the MCE 

when reported as the principal 

diagnosis. Codes V56.1 and V56.2 

describe conditions relating to dialysis 

for renal failure. Therefore, we believe 

that our proposal to utilize the existing 

CC list would encompass most of the 

cases on the recommended list, as well 

as other cases with additional CCs 

requiring additional resources. We have 

examined the MedPAR data for the 

cases in the coronary stent DRGs, 

distinguishing cases that include CCs 

and those that do not. The following 

table displays the results: 

The data show a clear differentiation 

in average charges between the cases in 

DRG 516 and 526 ‘‘with CC’’ and those 

‘‘without CC.’’ Therefore, the data 

suggest that a ‘‘with and without CC’’

split in DRG 516 and 526 is warranted. 

At the same time, the data do not show 

such a clear differentiation, in either 

average charges or lengths of stay, 

among the cases in DRGs 517 and 527. 

Therefore, we are proposing to delete 

DRGs 516 and 526, and to substitute 

four new DRGs in their place. These 

new DRGs would be patterned after 

existing DRGs 516 and 526, except that 

they would be split based on the 

presence or absence of a secondary 

diagnosis on the existing CC list. 

Specifically, we are proposing to create 

DRG 547 (Percutaneous Cardiovascular 

Procedure with AMI with CC), DRG 548 

(Percutaneous Cardiovascular Procedure 

with AMI without CC), DRG 549 

(Percutaneous Cardiovascular Procedure 

with Drug-Eluting Stent with AMI with 

CC), and DRG 550 (Percutaneous 

Cardiovascular Procedure with DrugEluting Stent with AMI without CC). As 

we noted above, the MedPAR data do 

not support restructuring DRGs 517 and 

527 based on the presence or absence of 

a CC. Therefore, we are proposing to 

retain these two DRGs in their current 

forms. We believe this revised structure 

will result in a more inclusive and 

comprehensive array of cases within 

MDC 5 without selectively recognizing 

certain secondary diagnoses as 

‘‘complex.’’

While we are proposing some 

restructuring of the coronary stent DRGs 

for FY 2006, it is important to note that 

we will continue to monitor and analyze 

clinical and resource trends in this area. 

For example, we have found indications 

in the current data that treatment may 

be moving toward use of drug-eluting 

stents, and away from use of bare metal 

stents. Specifically, cases in DRGs 516 

and 517, which utilize bare metal stents, 

comprise only 44.4 percent, or less than 

half, of the cases in the four coronary 

stent DRGs in the MedPAR data we 

analyzed. As use of drug-eluting stents 

becomes the standard of treatment, we 

may consider over time whether to 

dispense with the distinction between 

these stents and the older bare metal 

stent technology in the structure of the 

coronary stent DRGs. In addition, we 

will continue to consider whether the 

structure of these DRGs ought to reflect 

differences in the number of vessels 

treated or the number of stents inserted, 

or both. As we discussed above, a new 

coding structure capable of identifying 

multiple vessel treatment and the 

insertion of multiple stents will go into 

effect on October 1, 2005. It remains 

premature to restructure the coronary 

stent DRGs on the basis of the number 

of vessels treated or the number of 

stents inserted, or both, until data 

reflecting the use of these new codes 

become available. However, we will 

analyze those data when they become 

available in order to determine whether 

a restructuring based on multiple vessel 

treatment or insertion of multiple stents, 

or both, is warranted. Our proposal to 

restructure two of the current coronary 

stent DRGs into paired ‘‘with and 

without CC’’ DRGs for FY 2006 does not 

preclude proposals in subsequent years 

to restructure the coronary stent DRGs 

in one or both of these ways. 


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c. Insertion of Left Atrial Appendage 

Device 

Atrial fibrillation is a common heart 

rhythm disorder that can lead to a 

cardiovascular blood clot formation 

leading to increased risk of stroke. 

According to product literature, nearly 

all strokes are from embolic clots arising 

in the left atrial appendage of the heart: 

an appendage for which there is no 

useful function. Standard therapy uses 

anticoagulation drugs. However, these 

drugs may be contraindicated in certain 

patients and may cause complications 

such as bleeding. The underlying 

concept behind the left atrial appendage 

device is to block off the left atrial 

appendage, so that the blood clots 

formed therein cannot travel to other 

sites in the vascular system. The device 

is implanted using a percutaneous 

catheter procedure under fluoroscopy 

through the femoral vein. Implantation 

is performed in a hospital 

catheterization laboratory using 

standard transseptal technique, with the 

patient generally under local anesthesia. 

The procedure takes approximately 1 

hour, and most patients stay overnight 

in the hospital. 

In the FY 2005 IPPS final rule (69 FR 

48978, August 11, 2004), we discussed 

the DRG assignment of new ICD–9–CM 

procedure code 37.90 (Insertion of left 

atrial appendage device) for clinical 

trials, effective for discharges occurring 

on or after October 1, 2004, to DRG 518 

(Percutaneous Cardiovascular Procedure 

without Coronary Artery Stent or Acute 

Myocardial Infarction)). In that final 

rule, we addressed the DRG assignment 

of procedure code 37.90 in response to 

a comment from a manufacturer who 

suggested that placement of the code in 

DRG 108 (Other Cardiothoracic 

Procedures) was more representative of 

the complexity of the procedure than 

placement in DRG 518. The 

manufacturer indicated that the 

suggested placement of procedure code 

37.90 in DRG 108 was justified because 

another percutaneous procedure, 

described by ICD–9-CM procedure code 

35.52 (Repair of atrial septal defect with 

prosthesis, closed technique), was 

assigned to DRG 108. As we indicated 

in the FY 2005 final rule (69 FR 48978), 

this comment prompted us to examine 

data in the FY 2003 MedPAR file for 

cases of code 35.52 assigned to DRG 108 

and DRG 518 in comparison to all cases 

assigned to DRG 108. We found the 

following: 

Therefore, we concluded that 

procedure code 35.52 showed a decided 

similarity to the cases found in DRG 

518, not DRG 108. At that time, we 

determined that we would analyze the 

cases for both clinical coherence and 

charge data as part of the IPPS FY 2006 

process of identifying the most 

appropriate DRG assignment for 

procedure code 35.52. 

We have now examined data from the 

FY 2004 MedPAR file and found results 

for cases assigned to DRG 108 and DRG 

518 that are similar to last year’s 

findings as indicated in the chart below: 

From this comparison, we found that 

when an atrial septal defect is 

percutaneously repaired, and procedure 

code 35.52 is the only code reported in 

DRG 108, there is a significant 

discrepancy in both the average charges 

and the average length of stay between 

the cases with procedure code 35.52 

reported in DRG 108 and the total cases 

in DRG 108. The total cases in DRG 108 

have average charges of $51,744 greater 

than the 872 cases in DRG 108 reporting 

procedure code 35.52 as the only 

procedure. The total cases in DRG 108 

also have an average length of stay of 

7.39 days greater than the average length 

of stay for cases in DRG 108 with 

procedure code 35.52 reported. In 

comparison, the total cases in DRG 518 

have average charges of only $1,988 

lower than the cases in DRG 108 with 

only procedure code 35.52 reported. In 

addition, the length of stay in total cases 

in DRG 518 is more closely related to 

cases in DRG 108 with only procedure 

code 35.52 reported. 

Based on our analysis of these data, 

we are proposing to move procedure 

code 35.52 out of DRG 108 and place it 

in DRG 518. We believe that this 

proposal would result in a more 

coherent group of cases in DRG 518 that 

reflect all percutaneous procedures. 

d. External Heart Assist System Implant 

In the August 1, 2002, final rule (67 

FR 49989), we attempted to clinically 

and financially align ventricular assist 

device (VAD) procedures by creating 

DRG 525 (Heart Assist System Implant). 

We also noted that cases in which a 

heart transplant also occurred during 

the same hospitalization episode would 

continue to be assigned to DRG 103 

(Heart Transplant). 

After further data review during the 

next 2 years, we decided to realign the 


EP04MY05.006</GPH> EP04MY05.007</GPH>
23322 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

DRGs containing VAD codes for FY 

2005. In the August 11, 2004 final rule 

(69 FR 48927), we announced changes 

to DRG 103, DRG 104 (Cardiac Valve 

and Other Major Cardiothoracic 

Procedure with Cardiac 

Catheterization), DRG 105 (Cardiac 

Valve and Other Major Cardiothoracic 

Procedures Without Cardiac 

Catheterization), and DRG 525. 

In summary, these changes 

included—

• Moving code 37.66 (Insertion of 

implantable heart assist system) out of 

DRG 525 and into DRG 103. 

• Renaming DRG 525 as ‘‘Other Heart 

Assist System Implant.’’

• Moving code 37.62 (Insertion of 

non-implantable heart assist system) out 

of DRGs 104 and 105 and back into DRG 

525. 

DRG 525 currently consists of any 

principal diagnosis in MDC 5, plus the 

following surgical procedure codes: 

• 37.52, Implantation of total 

replacement heart system *. 

• 37.53, Replacement or repair of 

thoracic unit of total replacement heart 

system *. 

• 37.54, Replacement or repair of 

other implantable component of total 

replacement heart system *. 

• 37.62, Insertion of non-implantable 

heart assist system. 

• 37.63, Repair of heart assist system. 

• 37.65, Implant of external heart 

assist system. 

* These codes represent noncovered 

services for Medicare beneficiaries. However, 

it is our longstanding practice to assign every 

code in the ICD–9–CM classification to a 

DRG. Therefore, they have been assigned to 

DRG 525. 

Since that decision, we have been 

encouraged by a manufacturer to 

reevaluate DRG 525 for FY 2006. The 

manufacturer requested that we again 

review the data surrounding cases 

reporting code 37.65 and has suggested 

moving these cases into DRG 103. The 

manufacturer pointed out the following: 

Code 37.65 describes the implantation 

of an external heart assist system and is 

currently approved by the FDA as a 

bridge-to-recovery device. From the 

standpoint of clinical status, the 

patients in DRG 103 and receiving an 

external heart assist system are similar 

because their native hearts cannot 

support circulation, and absent a heart 

transplant, a mechanical pump is 

needed for patient survival. The surgical 

procedures for implantation of both an 

internal VAD and an external VAD are 

very similar. However, the external 

heart assist system (code 37.65) is a less 

expensive device than the implantable 

heart assist system (code 37.66). The 

manufacturer suggested that the 

payment differential between DRGs 103 

and 525 is an incentive to choose the 

higher paying device, and asserted that 

only a subset of patients receiving an 

implantable heart assist system are best 

served by this device. The manufacturer 

also suggested that the initial use of the 

least expensive therapeutically 

appropriate device yields both the best 

clinical outcomes and the lowest total 

system costs. 

We note that, under the DRG system, 

our intent is to create payments that are 

reflective of the average resources 

required to treat a particular case. Our 

goal is that physicians and hospitals 

should make treatment decisions based 

on the clinical needs of the patient and 

not financial incentives. 

When we reviewed the FY 2004 

MedPAR data, we were able to 

demonstrate the following comparisons: 

The above table shows that the 37.8 

percent of cases in DRG 525 that 

reported code 37.65 have average 

charges that are nearly $33,000 higher 

than the average charges for all cases in 

the DRG. However, the average charges 

for the subset of cases with code 37.65 

in DRG 525 ($206,497) are more than 

$107,086 lower than the average charges 

for all cases in DRG 103 ($313,583). 

Furthermore, the average length of stay 

for the subset of patients in DRG 525 

receiving an external heart assist system 

was 9.26 days compared to 37.5 days for 

the 633 cases in DRG 103. 

We note that the analysis above 

presents the difference in average 

charges, not costs. Because hospitals’

charges are higher than costs, the 

difference in hospital costs will be less 

than the figures shown here. Moving 

cases containing code 37.65 from DRG 

525 to DRG 103 would have two 

consequences. The cases in DRG 103 

reporting code 37.65 would be 

appreciably overreimbursed, which 

would be inconsistent with our goal of 

coherent reimbursement structure 

within the DRGs. In addition, the 

relative weight of DRG 103 would 

decrease by moving the less resourceintensive external heart procedures into 

the same DRG with the more expensive 

heart transplant cases. The net effect 

would be an underpayment for heart 

transplant cases. Alternatively, we also 

reconsidered our position on moving 

the insertion of an implantable heart 

assist system (code 37.66) back into 


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DRG 525. However, as shown in the FY 

2005 IPPS final rule (69 FR 48929), the 

resource costs associated with caring for 

a patient receiving an implantable heart 

assist system are far more similar to 

those cases receiving a heart transplant 

in DRG 103 than they are to cases in 

DRG 525. For these reasons, we are not 

proposing to make any changes to the 

structure of either DRG 103 or DRG 525 

in this proposed rule. 

e. Carotid Artery Stent 

Stroke is the third leading cause of 

death in the United States and the 

leading cause of serious, long-term 

disability. Approximately 70 percent of 

all strokes occur in people age 65 and 

older. The carotid artery, located in the 

neck, is the principal artery supplying 

the head and neck with blood. 

Accumulation of plaque in the carotid 

artery can lead to stroke either by 

decreasing the blood flow to the brain 

or by having plaque break free and lodge 

in the brain or in other arteries to the 

head. The percutaneous transluminal 

angioplasty (PTA) procedure involves 

inflating a balloon-like device in the 

narrowed section of the carotid artery to 

reopen the vessel. A carotid stent is then 

deployed in the artery to prevent the 

vessel from closing or restenosing. A 

distal filter device (embolic protection 

device) may also be present, which is 

intended to prevent pieces of plaque 

from entering the bloodstream. 

Effective July 1, 2001, Medicare 

covers PTA of the carotid artery 

concurrent with carotid stent placement 

when furnished in accordance with the 

FDA-approved protocols governing 

Category B Investigational Device 

Exemption (IDE) clinical trials. PTA of 

the carotid artery, when provided solely 

for the purpose of carotid artery dilation 

concurrent with carotid stent 

placement, is considered to be a 

reasonable and necessary service only 

when provided in the context of such 

clinical trials and, therefore, is 

considered a covered service for the 

purposes of these trials. Performance of 

PTA in the carotid artery when used to 

treat obstructive lesions outside of 

approved protocols governing Category 

B IDE clinical trials remains a 

noncovered service. 

At the April 1, 2004 ICD–9–CM 

Coordination and Maintenance 

Committee meeting, we discussed 

creation of a new code or codes to 

identify carotid artery stenting, along 

with a concomitant percutaneous 

angioplasty or atherectomy (PTA) code 

for delivery of the stent(s). This subject 

was addressed in response to the need 

to identify carotid artery stenting for use 

in clinical trials in the upcoming fiscal 

year. Public comment confirmed the 

need for specific codes for this 

procedure. We established codes for 

carotid artery stenting procedures 

effective October 1, 2004, for patients 

who are enrolled in an FDA-approved 

clinical trial and are using on-label FDA 

approved stents and embolic protection 

devices. 

New procedure codes 00.61 

(Percutaneous angioplasty or 

atherectomy of precerebral (extracranial 

vessel(s)) and 00.63 (Percutaneous 

insertion of carotid artery stent(s)) were 

published in Table 6B, New Procedure 

Codes in the FY 2005 IPPS final rule (69 

FR 49624). 

Procedure code 00.61 was assigned to 

four MDCs and seven DRGs. The most 

likely scenario is that in which cases are 

assigned to MDC 1 (Diseases and 

Disorders of the Nervous System in 

DRGs 533 (Extracranial Procedures with 

CC) and 534 (Extracranial Procedures 

without CC). Cases may also be assigned 

to MDC 5 (Diseases and Disorders of the 

Circulatory System), MDC 21 (Injuries, 

Poisoning, and Toxic Effects of Drugs), 

and MDC 24 (Multiple Significant 

Trauma). Other less likely DRG 

assignments can be found in Table 6B 

in the Addendum to the FY 2005 IPPS 

final rule (69 FR 49624). 

In the FY 2005 final rule, we 

indicated that we would continue to 

monitor DRGs 533 and 534 and 

procedure code 00.61 in combination 

with procedure code 00.63 in upcoming 

annual DRG reviews. For this proposed 

rule, we are using proxy codes to 

evaluate the costs and DRG assignments 

for carotid artery stenting because codes 

00.61 and 00.63 were only approved for 

use beginning October 1, 2004, and 

because MedPAR data for this period 

are not yet available. We used procedure 

code 39.50 (Angioplasty or atherectomy 

of other noncoronary vessel(s)) in 

combination with procedure code 39.90 

(Insertion of nondrug-eluting peripheral 

vessel stent(s)) in DRGs 533 and 534 as 

the proxy codes for coronary artery 

stenting. For this evaluation, we used 

principal diagnosis code 433.10 

(Occlusion and stenosis of carotid 

artery, without mention of cerebral 

infarction) because this diagnosis most 

closely reflects the clinical trial criteria. 

The following chart shows our 

findings: 

The patients receiving a carotid stent 

(codes 39.50 and 39.90) represented 3.5 

percent of all cases in DRG 534. On 

average, patients receiving a carotid 

stent had slightly shorter average 

lengths of stay than other patients in 

DRGs 533 and 534. While the average 

charges for patients receiving a carotid 

artery stent were higher than for other 

patients in DRG 534, in our view, the 

small number of cases and the 

magnitude of the difference in average 

charges are not sufficient to justify a 

change in the DRGs. 

Because we have a paucity of data for 

the carotid stent device and its 

insertion, and no data utilizing 

procedure codes 00.61 and 00.63 in a 

clinical trial setting, we believe it is 

premature to revise the DRG structure at 

this time. We expect to revisit this 

analysis once data become available on 

the new codes for carotid artery stents. 


EP04MY05.009</GPH>
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f. Extracorporeal Membrane 

Oxygenation (ECMO) 

Extracorporeal membrane 

oxygenation (ECMO) is a procedure to 

create a closed chest, heart-lung bypass 

system by insertion of vascular 

catheters. Patients receiving this 

procedure require mechanical 

ventilation. ECMO is performed for a 

small number of severely ill patients 

who are at high risk of dying without 

this procedure. Most often it is done for 

neonates with persistent pulmonary 

hypertension and respiratory failure for 

whom other treatments have failed, 

certain severely ill neonates receiving 

major cardiac procedures or 

diaphragmatic hernia repair, and certain 

older children and adults, most of 

whom are receiving major cardiac 

procedures. 

We received several letters from 

institutions that perform ECMO. The 

commenters stated that, in the CMS 

GROUPER logic, this procedure has 

little or no impact on the DRG 

assignment in the newborn, pediatric, 

and adult population. According to 

these letters, patients receiving ECMO 

are highly resource intensive and 

should have a unique DRG that reflects 

the costs of these resources. The 

commenters recommended the creation 

of a new DRG for ECMO with a DRG 

weight equal to or greater than the DRG 

weight for tracheostomy. 

ECMO is assigned to procedure code 

39.65 (Extracorporeal membrane 

oxygenation). This code is classified as 

an O.R. procedure and is assigned to 

DRG 104 (Cardiac Valve and Other 

Major Cardiothoracic Procedure With 

Cardiac Catheterization) and DRG 105 

(Cardiac Valve and Other Major 

Cardiothoracic Procedure Without 

Cardiac Catheterization). When ECMO 

is performed with other O.R. 

procedures, the case is assigned to the 

higher weighted DRG. For example, 

when ECMO and a tracheostomy are 

performed during the same admission, 

the case would be assigned to DRG 541 

(Tracheostomy with Mechanical 

Ventilation 96+ Hours or Principal 

Diagnosis Except Face, Mouth, and 

Neck Diagnoses With Major O.R.). 

We note that the primary focus of 

updates to the Medicare DRG 

classification system is changes relating 

to the Medicare patient population, not 

the pediatric patient population. 

Because ECMO is primarily a pediatric 

procedure and rarely performed in an 

adult population, we have few cases in 

our data to use to evaluate resource 

costs. We are aware that other insurers 

sometimes use Medicare’s rates to make 

payments. We advise private insurers to 

make appropriate modifications to our 

payment system when it is being used 

for children or other patients who are 

not generally found in the Medicare 

population. 

To evaluate the appropriateness of 

payment under the current DRG 

assignment, we have reviewed the FY 

2004 MedPAR data and found 78 ECMO 

cases in 13 DRGs. The following table 

illustrates the results of our findings: 

The average charges for all ECMO 

cases were approximately $258,821, and 

the average length of stay was 

approximately 20.7 days. The average 

charges for the ECMO cases are closer to 

the average charges for DRG 541 

($273,656) than to the average charges of 

DRG 104 ($147,766) and DRG 105 

($131,700). Of the 78 ECMO cases, 14 

cases are already assigned to DRG 541. 

We believe that the data indicate that 

DRG 541 would be a more appropriate 

DRG assignment for cases where ECMO 

is performed. We further note that under 

the All Payer DRG System used in New 

York State, cases involving ECMO are 

assigned to the tracheostomy DRG. 

Thus, the assignment of ECMO cases to 

the tracheostomy DRG for Medicare 

would be similar to how these cases are 

grouped in another DRG system. For 

these reasons, we are proposing to 

reassign ECMO cases reporting code 

39.65 to DRG 541. We are also 

proposing to change the title of DRG 541 

to: ‘‘ECMO or Tracheostomy With 

Mechanical Ventilation 96+ Hours or 

Principal Diagnosis Except Face, Mouth 

and Neck Diagnoses With Major O.R.’’

5. MDC 6 (Diseases and Disorders of the 

Digestive System): Artificial Anal 

Sphincter 

In the FY 2003 IPPS final rule (67 FR 

50242), we created two new codes for 

procedures involving an artificial anal 

sphincter, effective for discharges 

occurring on or after October 1, 2002: 

code 49.75 (Implantation or revision of 

artificial anal sphincter) is used to 

identify cases involving implantation or 

revision of an artificial anal sphincter 

and code 49.76 (Removal of artificial 

anal sphincter) is used to identify cases 

involving the removal of the device. In 

Table 6B of that final rule, we assigned 

both codes to one of four MDCs, based 

on principal diagnosis, and one of six 

DRGs within those MDCs: MDC 6 

(Diseases and Disorders of the Digestive 

System), DRGs 157 and 158 (Anal and 

Stomal Procedures With and Without 

CC, respectively); MDC 9 (Diseases and 

Disorders of the Skin, Subcutaneous 

Tissue and Breast), DRG 267 (Perianal 

and Pilonidal Procedures); MDC 21 

(Injuries, Poisonings, and Toxic Effects 

of Drugs), DRGs 442 and 443 (Other O.R. 

Procedures for Injuries With and 

without CC, respectively); and MDC 24 

(Multiple Significant Trauma), DRG 486 

(Other O.R. Procedures for Multiple 

Significant Trauma). 

In the FY 2004 IPPS final rule (68 FR 

45372), we discussed the assignment of 

these codes in response to a request we 

had received to consider reassignment 

of these two codes to different MDCs 

and DRGs. The requester believed that 

the average charges ($44,000) for these 

codes warranted reassignment. In the 

FY 2004 IPPS final rule, we stated that 

we did not have sufficient MedPAR data 

available on the reporting of codes 49.75 

and 49.76 to make a determination on 


EP04MY05.010</GPH>
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DRG reassignment of these codes. We 

agreed that, if warranted, we would give 

further consideration to the DRG 

assignments of these codes because it is 

our customary practice to review DRG 

assignment(s) for newly created codes to 

determine clinical coherence and 

similar resource consumption after we 

have had the opportunity to collect 

MedPAR data on utilization, average 

lengths of stay, average charges, and 

distribution throughout the system. In 

the FY 2005 IPPS final rule, we 

reviewed the FY 2003 MedPAR data for 

the presence of codes 49.75 and 49.76 

and determined that these procedures 

were not a clinical match with the other 

procedures in DRGs 157 and 158. 

Therefore, for FY 2005, we moved 

procedure codes 49.75 and 49.76 out of 

DRGs 157 and 158 and into DRGs 146 

and 147 (Rectal Resection With and 

Without CC, respectively). This change 

had the effect of doubling the payment 

for the cases with procedure codes 49.75 

and 49.76 assigned to DRGs 146 and 147 

based on increases in the relative 

weights. One commenter had suggested 

that we create a new DRG for ‘‘Complex 

Anal/Rectal Procedure with Implant.’’

However, we noted that the DRG 

structure is a system of averages and is 

based on groups of patients with similar 

characteristics. At that time, we 

indicated that we would continue to 

monitor procedure codes 49.75 and 

49.76 and the DRGs to which they are 

assigned. 

For this FY 2006 proposed rule, we 

reviewed the FY 2004 MedPAR data for 

the presence of codes 49.75 and 49.76. 

We found that these two procedures are 

still of low incidence. Among the six 

possible DRG assignments, we found a 

total of 18 cases reported with codes 

49.75 and 49.76 for the implant, 

revision, or removal of the artificial anal 

sphincter. We found 13 of these cases in 

DRGs 146 and 147 (compared to 12,558 

total cases in these DRGs), and the 

remaining 5 cases in DRGs 442 and 443 

(compared to 19,701 total cases in these 

DRGs). 

We believe the number of cases with 

codes 49.75 and 49.76 in these DRGs is 

too low to provide meaningful data of 

statistical significance. Therefore, we 

are not proposing any further changes to 

the DRGs for these procedures at this 

time. Neither are we proposing to 

change the structure of DRGs 146 or 147 

at this time. 

6. MDC 8 (Diseases and Disorders of the 

Musculoskeletal System and Connective 

Tissue) 

a. Hip and Knee Replacements 

Orthopedic surgeons representing the 

American Association of Orthopaedic 

Surgeons (AAOS) requested that we 

subdivide DRG 209 (Major Joint and 

Limb Reattachment Procedures of Lower 

Extremity) in MDC 8 by creating a new 

DRG for revision of lower joint 

procedures. The AAOS made a 

presentation at the October 7–8, 2004 

meeting of the ICD–9–CM Coordination 

and Maintenance Committee meeting. A 

summary report of this meeting can be 

found at the CMS Web site: http:// 

www.cms.hhs.gov/paymentsystems/ 

icd9/. We also received written 

comments on this request. 

The AAOS surgeons stated that cases 

involving patients who require a 

revision of a prior replacement of a knee 

or hip require significantly more 

resources than cases in which patients 

receive an initial joint replacement. 

They pointed out that total joint 

replacement is one of the most 

commonly performed and successful 

operations in orthopedic surgery. The 

surgeons mentioned that, in 2002, over 

300,000 hip replacement and 350,000 

knee replacement procedures were 

performed in the United States. They 

also pointed out that these procedures 

are a frequent reason for Medicare 

hospitalization. The surgeons stated that 

total joint replacements have been 

shown to be highly cost-effective 

procedures, resulting in dramatic 

improvements in quality of life for 

patients suffering from disabling 

arthritic conditions involving the hip or 

knee. In addition, they reported that the 

medical literature indicates success 

rates of greater than 90 percent for 

implant survivorship, reduction in pain, 

and improvement in function at a 10- 

year to 15-year followup. However, 

despite these excellent results with 

primary total joint replacement, factors 

related to implant longevity and 

evolving patient demographics have led 

to an increase in the volume of revision 

total joint procedures performed in the 

United States over the past decade. 

Total hip replacement is an operation 

that is intended to reduce pain and 

restore function in the hip joint by 

replacing the arthritic hip joint with a 

prosthetic ball and socket joint. The 

prosthetic hip joint consists of a metal 

alloy femoral component with a 

modular femoral head made of either 

metal or ceramic (the ‘‘ball’’) that 

articulates with a metal acetabular 

component with a modular liner made 

of either metal, ceramic, or high-density 

polyethylene (the ‘‘socket’’). 

The AAOS surgeons stated that in a 

normal knee, four ligaments help hold 

the bones in place so that the joint 

works properly. When a knee becomes 

arthritic, these ligaments can become 

scarred or damaged. During knee 

replacement surgery, some of these 

ligaments, as well as the joint surfaces, 

are substituted or replaced by the new 

artificial prostheses. Two types of 

fixation are used to hold the prostheses 

in place. Cemented designs use 

polymethyl methacrylate to hold the 

prostheses in place. Cementless designs 

rely on bone growing into the surface of 

the implant for fixation. 

The surgeons stated that all hip and 

knee replacements have an articular 

bearing surface that is subject to wear 

(the acetabular bearing surface in the 

hip and the tibial bearing surface in the 

knee). Traditionally, these bearing 

surfaces have been made of metal-onmetal or metal-on-polyethylene, 

although newer materials (both metals 

and ceramics) have been used more 

recently. Earlier hip and knee implant 

designs had nonmodular bearing 

surfaces, but later designs included 

modular articular bearing surfaces to 

reduce inventory and potentially 

simplify revision surgery. Wear of the 

articular bearing surface occurs over 

time and has been found to be related 

to many factors, including the age and 

activity level of the patient. In some 

cases, wear of the articular bearing 

surface can produce significant debris 

particles that can cause peri-prosthetic 

bone resorption (also known and 

osteolysis) and mechanical loosening of 

the prosthesis. Wear of the bearing 

surface can also lead to instability or 

prosthetic dislocation, or both, and is a 

common cause of revision hip or knee 

replacement surgery. 

Depending on the cause of failure of 

the hip replacement, the type of 

implants used in the previous surgery, 

the amount and quality of the patient’s 

remaining bone stock, and factors 

related to the patient’s overall health 

and anatomy, revision hip replacement 

surgery can be relatively straightforward 

or extremely complex. Revision hip 

replacement can involve replacing any 

part or all of the implant, including the 

femoral or acetabular components, and 

the bearing surface (the femoral head 

and acetabular liner), and may involve 

major reconstruction of the bones and 

soft tissues around the hip. All of these 

procedures differ significantly in their 

clinical indications, outcomes, and 

resource intensity. 

The AAOS surgeons provided the 

following summary of the types of 

23326 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

revision knee replacement procedures: 

Among revision knee replacement 

procedures, patients who underwent 

complete revision of all components 

had longer operative times, higher 

complication rates, longer lengths of 

stay, and significantly higher resource 

utilization, according to studies 

conducted by the AAOS. Revision of the 

isolated modular tibial insert 

component was the next most resourceintensive procedure, and primary total 

knee replacement was the least 

resource-intensive of all the procedures 

studied. 

• Isolated Modular Tibial Insert 

Exchange. Isolated removal and 

exchange of the modular tibial bearing 

surface involves replacing the modular 

polyethylene bearing surface without 

removing the femoral, tibial, or patellar 

components of the prosthetic joint. 

Common indications for this procedure 

include wear of the polyethylene 

bearing surface or instability (for 

example, looseness) of the prosthetic 

knee joint. Patient recovery times are 

much shorter with this procedure than 

with removal and exchange of either the 

tibial, femoral, or patellar components. 

• Revision of the Tibial Component. 

Revision of the tibial component 

involves removal and exchange of the 

entire tibial component, including both 

the metal base plate and the modular 

polyethylene bearing surface. Common 

indications for tibial component 

revision are wear of the modular bearing 

surface, aseptic loosening (often 

associated with osteolysis), or infection. 

Depending on the amount of associated 

bone loss and the integrity of the 

ligaments around the knee, tibial 

component revision may require the use 

of specialized implants with stems that 

extend into the tibial canal and/or the 

use of metal augments or bone graft to 

fill bony defects. 

• Revision of the Femoral 

Component. Revision of the femoral 

component involves removal and 

exchange of the metal implant that 

covers the end of the thigh-bone (the 

distal femur). Common indications for 

femoral component revision are aseptic 

loosening with or without associated 

osteolysis/bone loss, or infection. 

Similar to tibial revision, femoral 

component revision that is associated 

with extensive bone loss often involves 

the use of specialized implants with 

stems that extend into the femoral canal 

and/or the use of metal augments or 

bone graft to fill bony defects. 

• Revision of the Patellar Component. 

Complications related to the patellafemoral joint are one of the most 

common indications for revision knee 

replacement surgery. Early patellar 

implant designs had a metal backing 

covered by high-density polyethylene; 

these implants were associated with a 

high rate of failure due to fracture of the 

relatively thin polyethylene bearing 

surface. Other common reasons for 

isolated patellar component revision 

include poor tracking of the patella in 

the femoral groove leading to wear and 

breakage of the implant, fracture of the 

patella with or without loosening of the 

patellar implant, rupture of the 

quadriceps or patellar tendon, and 

infection. 

• Revision of All Components (Tibial, 

Femoral, and Patellar). The most 

common type of revision knee 

replacement procedure is a complete 

total knee revision. A complete revision 

of all implants is more common in knee 

replacements than hip replacements 

because the components of an artificial 

knee are not compatible across vendors 

or types of prostheses. Therefore, even 

if only one of the implants is loose or 

broken, a complete revision of all 

components is often required in order to 

ensure that the implants are compatible. 

Complete total knee revision often 

involves extensive surgical approaches, 

including osteotomizing (for example, 

cutting) the tibia bone in order to 

adequately expose the knee joint and 

gain access to the implants. These 

procedures often involve extensive bone 

loss, requiring reconstruction with 

specialized implants with long stems 

and metal augments or bone graft to fill 

bony defects. Depending on the status of 

the ligaments in the knee, complete total 

knee revision at times requires 

implantation of a highly constrained or 

‘‘hinged’’ knee replacement in order to 

ensure stability of the knee joint. 

• Reimplantation from previous 

resection or cement spacer. In cases of 

deep infection of a prosthetic knee, 

removal of the implants with 

implantation of an antibioticimpregnated cement spacer, followed by 

6 weeks of intravenous antibiotics is 

often required in order to clear the 

infection. Revision knee replacement 

from an antibiotic impregnated cement 

spacer often involves complex bony 

reconstruction due to extensive bone 

loss that occurs as a result of the 

infection and removal of the often wellfixed implants. As noted above, the 

clinical outcomes following revision 

from a spacer are often poor due to 

limited functional capacity while the 

spacer is in place, prolonged periods of 

protected weight bearing (following 

reconstruction of extensive bony 

defects), and the possibility of chronic 

infection. 

The surgeons stated that the current 

ICD–9–CM codes did not adequately 

capture the complex nature of revisions 

of hip and knee replacements. 

Currently, code 81.53 (Revision of hip 

replacement) captures all ‘‘partial’’ and 

‘‘total’’ revision hip replacement 

procedures. Code 81.55 (Revision of 

knee replacement) captures all revision 

knee replacement procedures. These 

two codes currently capture a wide 

variety of procedures that differ in their 

clinical indications, resource intensity, 

and clinical outcomes. 

An AAOS representative made a 

presentation at the October 7–8, 2004 

ICD–9–CM Coordination and 

Maintenance Committee. Based on the 

comments received at the October 7–8, 

2004 meeting and subsequent written 

comments, new ICD–9–CM procedure 

codes were developed to better capture 

the variety of ways that revision of hip 

and knee replacements can be 

performed: codes 00.70 through 00.73 

and code 81.53 for revisions of hip 

replacements and codes 00.80 through 

00.84 and code 81.55 for revisions of 

knee replacements. These new and 

revised procedure codes, which will be 

effective on October 1, 2005, can be 

found in Table 6B and Table 6F of this 

proposed rule. The commenters stated 

that claims data using these new and 

specific codes should provide improved 

data on these procedures for future DRG 

modifications. 

However, the commenters requested 

that CMS consider DRG modifications 

based on current data using the existing 

revision codes. The commenters 

reported on a recently completed study 

comparing detailed hospital resource 

utilization and clinical characteristics in 

over 10,000 primary and revision hip 

and knee replacement procedures at 3 

high volume institutions: The 

Massachusetts General Hospital, the 

Mayo Clinic, and the University of 

California at San Francisco. The 

purpose of this study was to evaluate 

differences in clinical outcomes and 

resource utilization among patients who 

underwent different types of primary 

and revision hip or knee replacement 

procedures. The study found significant 

differences in operative time, 

complication rates, hospital length of 

stay, discharge disposition, and resource 

utilization among patients who 

underwent different types of revision 

hip or knee replacement procedures. 

Among revision hip replacement 

procedures, patients who underwent 

both femoral and acetabular component 

revision had longer operative times, 

higher complication rates, longer 

lengths of stay, significantly higher 

resource utilization, and were more 

likely to be discharged to a subacute 

care facility. Isolated femoral 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23327 

component revision was the next most 

resource-intensive procedure, followed 

by isolated acetabular revision. Primary 

hip replacement was the least resource 

intensive of all the procedures studied. 

Similarly, among revision knee 

replacement procedures, patients who 

underwent complete revision of all 

components had longer operative times, 

higher complication rates, longer 

lengths of stay, and significantly higher 

resource utilization. Revision of one 

component was the next most resourceintensive procedure. Primary total knee 

replacement was the least resource 

intensive of all the procedures studied. 

In addition, the commenters indicated 

that the data showed that extensive 

bone loss around the implants and the 

presence of a peri-prosthetic fracture 

were the most significant predictors of 

higher resource utilization among all 

revision hip and knee replacement 

procedures, even when controlling for 

other significant patient and procedural 

characteristics. 

For this proposed rule, we examined 

data in the FY 2004 MedPAR file on the 

current hip replacement procedures 

(codes 81.51, 81.52, 81.53) as well as the 

replacements and revisions of knee 

replacement procedures (codes 81.54 

and 81.55) in DRG 209. We found that 

revisions were significantly more 

resource intensive than the original hip 

and knee replacements. We found 

average charges for revisions of hip and 

knee replacements were approximately 

$7,000 higher than average charges for 

the original joint replacements, as 

shown in the following charts. The 

average charges for revisions of hip 

replacements were 21 percent higher 

than the average charges for initial hip 

replacements. The average charges for 

revisions of knee replacements were 25 

percent higher than for initial knee 

replacements. 

We note that there were no cases in 

DRG 209 for reattachment of the foot, 

lower leg, or thigh (codes 84.29, 84.27, 

and 84.28). 

To address the higher resource costs 

associated with hip and knee revisions 

relative to the initial joint replacement 

procedure, we are proposing to delete 

DRG 209, create a proposed new DRG 

544 (Major Joint Replacement or 

Reattachment of Lower Extremity), and 

create a proposed new DRG 545 

(Revision of Hip or Knee Replacement). 

We are proposing to assign the 

following codes to the new proposed 

DRG 544: 

• 81.51, Total hip replacement. 

• 81.52, Partial hip replacement. 

• 81.54, Total knee replacement. 

• 81.56, Total ankle replacement. 

• 84.26, Foot reattachment. 

• 84.27, Lower leg/ankle reattach. 

• 84.28, Thigh reattachment. 

We are proposing to assign the 

following codes to the proposed new 

DRG 545: 

• 00.70, Revision of hip replacement, 

both acetabular and femoral 

components. 

• 00.71, Revision of hip replacement, 

acetabular component. 

• 00.72, Revision of hip replacement, 

femoral component. 

• 00.73, Revision of hip replacement, 

acetabular liner and/or femoral head 

only. 

• 00.80, Revision of knee 

replacement, total (all components). 

• 00.81, Revision of knee 

replacement, tibial component. 

• 00.82, Revision of knee 

replacement, femoral component. 

• 00.83, Revision of knee 

replacement, patellar component. 

• 00.84, Revision of knee 

replacement, tibial insert (liner). 

• 81.53, Revision of hip replacement, 

not otherwise specified. 

• 81.55, Revision of knee 

replacement, not otherwise specified. 

We agree with the commenters and 

the AAOS that the creation of a new 

DRG for revisions of hip and knee 

replacements should resolve payment 

issues for hospitals that perform the 

more difficult revisions of joint 

replacements. In addition, as stated 

earlier, we have worked with the 

orthopedic community to develop new 

procedure codes that better capture data 

on the types of revisions of hip and knee 

replacements. These new codes will be 

implemented on October 1, 2005. Once 

we receive claims data using these new 

codes, we will review data to determine 

if additional DRG modifications are 

needed. This effort may include 

assigning some of the revision codes, 

such as 00.83 and 00.84 to a separate 

DRG. As stated earlier, the AAOS has 

found that some of the procedures may 

not be as resource intensive. Therefore, 

the AAOS has requested that CMS 

closely examine data from the use of the 

new codes and consider future 

revisions. 

b. Kyphoplasty 

In the FY 2005 IPPS final rule (69 FR 

48938), we discussed the creation of 

new codes for vertebroplasty (81.65) and 

kyphoplasty (81.66), which went into 

effect on October 1, 2004. Prior to 

October 1, 2004, both of these surgical 

procedures were assigned to code 78.49 

(Other repair or plastic operation on 

bone). For FY 2005, we assigned these 

codes to DRGs 233 and 234 (Other 

Musculoskeletal System and Connective 

Tissue O.R. Procedure With and 

Without CC, respectively) in MDC 8 

(Table 6B of the FY 2005 final rule). (In 

the FY 2005 IPPS final rule (69 FR 

48938), we indicated that new codes 

81.65 and 81.66 were assigned to DRGs 

223 and 234. We made a typographical 

error when indicating that these codes 

were assigned to DRG 223. Codes 81.65 

and 81.66 have been assigned to DRGs 


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233 and 234.) Last year, we received 

comments opposing the assignment of 

code 81.66 to DRGs 233 and 234. The 

commenters supported the creation of 

the codes for kyphoplasty and 

vertebroplasty but recommended that 

code 81.66 be assigned to DRGs 497 and 

498 (Spinal Fusion Except Cervical 

With and Without CC, respectively). 

The commenters stated that kyphoplasty 

requires special inflatable bone tamps 

and bone cement and is a significantly 

more resource intensive procedure than 

vertebroplasty. The commenters further 

stated that, while kyphoplasty involves 

internal fixation of the spinal fracture 

and restoration of vertebral heights, 

vertebroplasty involves only fixation. 

The commenters indicated that hospital 

costs for kyphoplasty procedures are 

more similar to resources used in a 

spinal fusion. 

We stated in the FY 2005 IPPS final 

rule that we did not have data in the 

MedPAR file on kyphoplasty and 

vertebroplasty. Prior to October 1, 2004, 

both procedures were assigned in code 

78.49, which was assigned to DRGs 233 

and 234 in MDC 8. We stated that we 

would continue to review this area as 

part of our annual review of MedPAR 

data. While we do not have separate 

data for kyphoplasty because code 81.66 

was not established until October 1, 

2004, for this proposed rule, we did 

examine data on code 78.49, which 

includes both kyphoplasty and 

vertebroplasty procedures reported in 

DRGs 233 and 234. The following chart 

illustrates our findings: 

We do not believe these data findings 

support moving cases represented by 

code 78.49 out of DRGs 233 and 234. 

While we cannot distinguish cases that 

are kyphoplasty from cases that are 

vertebroplasty, cases represented by 

code 78.49 have lower charges than do 

other cases within DRGs 233 and 234. 

Therefore, we are not proposing to 

change the DRG assignment of code 

81.66 to DRGs 233 and 234 at this time. 

However, once specific charge data are 

available, we will consider whether 

further changes are warranted. 

c. Multiple Level Spinal Fusion 

On October 1, 2003, the following 

ICD–9–CM codes were created to 

identify the number of levels of vertebra 

fused during a spinal fusion procedure: 

• 81.62, Fusion or refusion of 2–3 

vertebrae. 

• 81.63, Fusion or refusion of 4–8 

vertebrae. 

• 81.64, Fusion or refusion of 9 or 

more vertebrae. 

Prior to the creation of these codes, 

we received a comment recommending 

the establishment of new DRGs that 

would be differentiated based on the 

number of vertebrae fused. In the FY 

2005 IPPS final rule (69 FR 48936), we 

stated that we did not yet have any 

reported cases utilizing these multiple 

level spinal fusion codes. We stated that 

we would wait until sufficient data were 

available prior to making a final 

determination on whether to create 

separate DRGs based on the number of 

vertebrae fused. We also stated that 

spinal fusion surgery was an area 

undergoing rapid changes. 

Effective October 1, 2004, we created 

a series of codes that describe a new 

type of spinal surgery, spinal disc 

replacement. Our medical advisors 

describe these procedures as a more 

conservative approach for back pain 

than the spinal fusion surgical 

procedure. These codes are as follows: 

• 84.60, Insertion of spinal disc 

prosthesis, not otherwise specified. 

• 84.61, Insertion of partial spinal 

disc prosthesis, cervical. 

• 84.62, Insertion of total spinal disc 

prosthesis, cervical. 

• 84.63, Insertion of spinal disc 

prosthesis, thoracic. 

• 84.64, Insertion of partial spinal 

disc prosthesis, lumbosacral. 

• 84.65, Insertion of total spinal disc 

prosthesis, lumbosacral. 

• 84.66, Revision or replacement of 

artificial spinal disc prosthesis, cervical. 

• 84.67, Revision or replacement of 

artificial spinal disc prosthesis, thoracic. 

• 84.68, Revision or replacement of 

artificial spinal disc prosthesis, 

lumbosacral. 

• 84.69, Revision or replacement of 

artificial spinal disc prosthesis, not 

otherwise specified. 

We also created the following two 

codes effective October 1, 2004, for 

these new types of spinal surgery that 

are also a more conservative approach to 

back pain than is spinal fusion: 

• 81.65 Vertebroplasty. 

• 81.66 Kyphoplasty. 

We do not yet have data in the 

MedPAR file on these new types of 

procedures. Therefore, we cannot yet 

determine what effect these new types 

of procedures will have on the 

frequency of spinal fusion procedures. 

However, we do have data in the 

MedPAR file on multiple level spinal 

procedures for analysis for this year’s 

proposed rule. We examined data in the 

FY 2004 MedPAR file on spinal fusion 

cases in the following DRGs: 

• DRG 496 (Combined Anterior/ 

Posterior Spinal Fusion). 

• DRG 497 (Spinal Fusion Except 

Cervical With CC). 

• DRG 498 (Spinal Fusion Except 

Cervical Without CC). 

• DRG 519 (Cervical Spinal Fusion 

With CC). 

• DRG 520 (Cervical Spinal Fusion 

Without CC). 

Multiple level spinal fusion is 

captured by code 81.63 (Fusion or 

refusion of 4–8 vertebrae) and code 

81.64 (Fusion or refusion of 9 or more 

vertebrae). Code 81.62 includes the 

fusion of 2–3 vertebrae and is not 

considered a multiple level spinal 

fusion. Orthopedic surgeons stated at 

the October 7–8, 2004 ICD–9–CM 

Coordination and Maintenance 

Committee meeting that the most simple 

and common type of spinal fusion 

involves fusing either 2 or 3 vertebrae. 

These surgeons stated that there was not 


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a significant difference in resource 

utilization for cases involving the fusion 

of 2 versus 3 vertebrae. For this reason, 

the orthopedic surgeons recommended 

that fusion of 2 and 3 vertebrae be 

grouped into one ICD–9–CM code. 

We reviewed the Medicare charge 

data to determine whether the number 

of vertebrae fused or specific diagnoses 

have an effect on average length of stay 

and resource use for a patient. We found 

that, while fusing 4 or more levels of the 

spine results in a small increase in the 

average length of stay and a somewhat 

larger increase in average charges for 

spinal fusion patients, an even greater 

impact was made by the presence of a 

principal diagnosis of curvature of the 

spine or malignancy. The following list 

of diagnoses describes conditions that 

have a significant impact on resource 

use for spinal fusion patients: 

• 170.2, Malignant neoplasm of 

vertebral column, excluding sacrum and 

coccyx. 

• 198.5, Secondary malignant 

neoplasm of bone and bone marrow. 

• 732.0, Juvenile osteochondrosis of 

spine. 

• 733.13, Pathologic fracture of 

vertebrae. 

• 737.0, Adolescent postural 

kyphosis. 

• 737.10, Kyphosis (acquired) 

(postural). 

• 737.11, Kyphosis due to radiation. 

• 737.12, Kyphosis, 

postlaminectomy. 

• 737.19, Kyphosis (acquired), other. 

• 737.20, Lordosis (acquired) 

(postural). 

• 737.21, Lordosis, postlaminectomy 

• 737.22, Other postsurgical lordosis. 

• 737.29, Lordosis (acquired), other. 

• 737.30, Scoliosis [and 

kyphoscoliosis], idiopathic. 

• 737.31, Resolving infantile 

idiopathic scoliosis. 

• 737.32, Progressive infantile 

idiopathic scoliosis. 

• 737.33, Scoliosis due to radiation. 

• 737.34, Thoracogenic scoliosis. 

• 737.39, Other kyphoscoliosis and 

scoliosis. 

• 737.40, Curvature of spine, 

unspecified. 

• 737.41, Curvature of spine 

associated with other conditions, 

kyphosis. 

• 737.42, Curvature of spine 

associated with other conditions, 

lordosis. 

• 737.43, Curvature of spine 

associated with other conditions, 

scoliosis. 

• 737.8, Other curvatures of spine. 

• 737.9, Unspecified curvature of 

spine. 

• 754.2, Congenital scoliosis. 

• 756.51, Osteogenesis imperfecta. 

The majority of fusion patients with 

these diagnoses were in DRGs 497 and 

498. The chart below reflects our 

findings. We also include in the chart 

statistics for cases in DRGs 497 and 498 

with spinal fusion of 4 or more 

vertebrae and cases with a principal 

diagnosis of curvature of the spine or 

bone malignancy. 

Thus, these diagnoses result in a 

significant increase in resource use. 

While the fusing of 4 or more vertebrae 

resulted in average charges of $77,352, 

the impact of a principal diagnosis of 

curvature of the spine or bone 

malignancy was substantially greater 

with average charges of $95,315. 

Based on this analysis, we are 

proposing to create a new DRG for 

noncervical spinal fusions with a 

principal diagnosis of curvature of the 

spine and malignancies. The proposed 

new DRG would be: proposed new DRG 

546 (Spinal Fusions Except Cervical 

With Principal Diagnosis of Curvature of 

the Spine or Malignancy). Cases 

included in this proposed new DRG 

would include all noncervical spinal 

fusions previously assigned to DRGs 497 

and 498 that have a principal diagnosis 

of curvature of the spine or malignancy 

and would include the following codes 

listed above: 170.2, 198.5, 732.0, 733.13, 

737.0, 737.10, 737.11, 737.12, 737.19, 

737.20, 737.21, 737.22, 737.29, 737.30, 

737.31, 737.32, 737.33, 737.34, 737.39, 

737.40, 737.41, 737.42, 737.43, 737.8, 

737.9, 754.2, and 756.51. The proposed 

DRG 546 would not include cases 

currently assigned to DRGs 496, 519, or 

520 that have a principal diagnosis of 

curvature of the spine or malignancy. 

The structure of DRGs 496, 519, and 520 

would remain the same. 

As part of our meeting with the AAOS 

on DRG 209 in February 2005 

(discussed under section II.B.6.a. of this 

preamble), the AAOS offered to work 

with CMS to analyze clinical issues and 

make revisions to the spinal fusion 

DRGs (DRGs 496 through 498 and 519 

and 520). At this time, we are limiting 

our proposed changes to the spinal 

fusion DRGs for FY 2006 to the creation 

of the proposed DRG 546 discussed 

above. However, we look forward to 

working with the AAOS to obtain its 

clinical recommendations concerning 

our proposed changes and potential 

additional modifications to the spinal 

fusion DRGs. We are also soliciting 

comments from the public on our 

proposed changes and how to 

incorporate new types of spinal 

procedures such as kyphoplasty and 

spinal disc prostheses into the spinal 

fusion DRGs. 

7. MDC 18 (Infectious and Parasitic 

Diseases (Systemic or Unspecified 

Sites)): Severe Sepsis 

As we did for FY 2005, we received 

a request to consider the creation of a 

separate DRG for the diagnosis of severe 

sepsis for FY 2006. Severe sepsis is 

described by ICD–9–CM code 995.92 

(Systemic inflammatory response 

syndrome due to infection with organ 

dysfunction). Patients admitted with 

sepsis currently are assigned to DRG 416 

(Septicemia Age > 17) and DRG 417 


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(Septicemia Age 0–17) in MDC 18 

(Infectious and Parasitic Diseases, 

Systemic or Unspecified Sites). The 

commenter requested that all cases in 

which severe sepsis is present on 

admission, as well as those cases in 

which it develops after admission 

(which are currently classified 

elsewhere), be included in this new 

DRG. We addressed this issue in the FY 

2005 IPPS final rule (69 FR 48975). As 

indicated last year, we do not feel the 

current clinical definition of severe 

sepsis is specific enough to identify a 

meaningful cohort of patients in terms 

of clinical coherence and resource 

utilization to warrant a separate DRG. 

Sepsis is found across hundreds of 

medical and surgical DRGs, and the 

term ‘‘organ dysfunction’’ implicates 

numerous currently existing diagnosis 

codes. While we recognize that 

Medicare beneficiaries with severe 

sepsis are quite ill and require extensive 

hospital resources, we do not believe 

that they can be identified adequately to 

justify removing them from all of the 

other DRGs in which they appear. We 

are not proposing a new DRG for severe 

sepsis at this time. 

8. MDC 20 (Alcohol/Drug Use and 

Alcohol/Drug Induced Organic Mental 

Disorders): Drug-Induced Dementia 

In the FY 2005 IPPS final rule (69 FR 

48939, August 11, 2004), we discussed 

a request that CMS modify DRGs 521 

through 523 by removing the principal 

diagnosis code 292.82 (Drug-induced 

dementia) from these alcohol and drug 

abuse DRGs. These DRGs are as follows: 

• DRG 521 (Alcohol/Drug Abuse or 

Dependence With CC). 

• DRG 522 (Alcohol/Drug Abuse or 

Dependence With Rehabilitation 

Therapy Without CC). 

• DRG 523 (Alcohol/Drug Abuse or 

Dependence Without Rehabilitation 

Therapy Without CC). 

The commenter indicated that a 

patient who has a drug-induced 

dementia should not be classified to an 

alcohol/drug DRG. However, the 

commenter did not propose a new DRG 

assignment for code 292.82. Our 

medical advisors evaluated the request 

and determined that the most 

appropriate DRG classification for a 

patient with drug-induced dementia 

was within MDC 20. The medical 

advisors indicated that because the 

dementia is drug induced, it is 

appropriately classified to DRGs 521 

through 523 in MDC 20. Therefore, we 

did not propose a new DRG 

classification for the principal diagnosis 

code 292.82. 

In the FY 2005 IPPS final rule, we 

addressed a comment from an 

organization representing hospital 

coders that disagreed with our decision 

to keep code 292.82 in DRGs 521 

through 523. The commenter stated that 

DRGs 521 through 523 are described as 

alcohol/drug abuse and dependence 

DRGs, and that drug-induced dementia 

can be caused by an adverse effect of a 

prescribed medication or a poisoning. 

The commenter did not believe that 

assignment to DRGs 521 through 523 

was appropriate if the drug-induced 

dementia is due to one of these events 

and the patient is not alcohol or drug 

dependent. The commenter 

recommended that admissions for druginduced dementia be classified to DRGs 

521 through 523 only if there is a 

secondary diagnosis indicating alcohol/ 

drug abuse or dependence. 

The commenter recommended that 

drug-induced dementia that is due to 

the adverse effect of a drug or poisoning 

be classified to the same DRGs as other 

types of dementia, such as DRG 429 

(Organic Disturbances and Mental 

Retardation). The commenter believed 

that when drug-induced dementia is 

caused by a poisoning, either accidental 

or intentional, the appropriate 

poisoning code would be sequenced as 

the principal diagnosis and, therefore, 

these cases would likely already be 

assigned to DRGs 449 and 450 

(Poisoning and Toxic Effects of Drugs, 

Age Greater than 17, With and Without 

CC, respectively) and DRG 451 

(Poisoning and Toxic Effects of Drugs, 

Age 0–17). The commenter stated that 

these would be the appropriate DRG 

assignments for drug-induced dementia 

due to a poisoning. We received a 

similar comment from a hospital 

organization. 

In the FY 2005 IPPS final rule, we 

acknowledged that the commenters 

raised additional issues surrounding the 

DRG assignment for code 292.82 that 

should be considered. The commenters 

provided alternatives for DRG 

assignment based on sequencing of the 

principal diagnosis and reporting of 

additional secondary diagnoses. We 

recognized that patients may develop 

drug-induced dementia from drugs that 

are prescribed, as well as from drugs 

that are not prescribed. However, 

because dementia develops as a result of 

use of a drug, we believed the current 

DRG assignment to DRGs 521 through 

523 remained appropriate. Some 

commenters have agreed with the 

current DRG assignment of code 292.82 

since the dementia was caused by use 

of a drug. We agree that if either 

accidental or intentional poisoning 

caused the drug-induced dementia, the 

appropriate poisoning code should be 

sequenced as the principal diagnosis. As 

one commenter stated, these cases 

would be assigned to DRGs 449 through 

451. We encouraged hospitals to 

examine the coding for these types of 

cases to determine if there were any 

coding or sequencing errors. As 

suggested by the commenter, if code 

292.82 were reported as a secondary 

diagnosis and not a principal diagnosis 

in cases of poisoning or adverse drug 

reactions, the number of cases on DRGs 

521 through 523 would decline. 

In the FY 2005 IPPS final rule, we 

agreed to analyze this area for FY 2006 

and to look at the alternative DRG 

assignments suggested by the 

commenters. For this proposed rule, we 

examined data from the FY 2004 

MedPAR file on cases in DRGs 521 

through 523 with a principal diagnosis 

of code 292.82. We found that there 

were only 134 cases reported with the 

principal diagnosis code 292.82 in DRGs 

521 through 523 without a diagnosis of 

drug and alcohol abuse. The average 

standardized charges for cases with a 

principal diagnosis of code 292.82 that 

did not have a secondary diagnosis of 

drug/alcohol abuse or dependence were 

$12,244.35, compared to the average 

standardized charges for all cases in 

DRG 521, which were $10,543.69. There 

were no cases in DRG 522 with a 

principal diagnosis of code 292.82. We 

found only 24 cases in DRG 523 with a 

principal diagnosis of code 292.82. 

Given the small number of cases in DRG 

522 and 523, and the similarity in 

average standardized charges between 

those cases in DRG 521 with a principal 

diagnosis of code 292.82 and without a 

secondary diagnosis of drug/alcohol 

abuse or dependence to the overall 

average for all cases in the DRG, we do 

not believe the data suggest that a 

modification to DRGs 521 through 523 

is warranted. Therefore, we are not 

proposing changes to the current 

structure of DRGs 521 through 523 for 

FY 2006. 

9. Medicare Code Editor (MCE) Changes 

(If you choose to comment on issues 

in this section, please include the 

caption ‘‘Medicare Code Editor’’ at the 

beginning of your comment.) 

As explained under section II.B.1. of 

this preamble, the Medicare Code Editor 

(MCE) is a software program that detects 

and reports errors in the coding of 

Medicare claims data. Patient diagnoses, 

procedure(s), discharge status, and 

demographic information go into the 

Medicare claims processing systems and 

are subjected to a series of automated 

screens. The MCE screens are designed 

to identify cases that require further 

review before classification into a DRG. 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23331 

a. Newborn Age Edit 

In the past, we have discussed and 

received comments concerning revision 

of the pediatric portions of the Medicare 

IPPS DRG classification system, that is, 

MDC 15 (Newborns and Other Neonates 

With Conditions Originating in the 

Perinatal Period). Most recently, we 

addressed these comments in both the 

FY 2005 proposed rule (69 FR 28210) 

and the FY 2005 IPPS final rule (69 FR 

48938). In those rules, we indicated that 

we would be responsive to specific 

requests for updating MDC 15 on a 

limited, case-by-case basis. 

We have recently received a request 

through the Open Door Forum to revise 

the MCE ‘‘newborn age edit’’ by 

removing over 100 codes located in 

Chapter 15 of ICD–9–CM that are 

identified as ‘‘newborn’’ codes. This 

request was made because these codes 

usually cause an edit or denial to be 

triggered when they are used on 

children greater than 1 year of age. 

However, the underlying issue with 

these particular edits is that other 

payers have adopted the CMS Medicare 

Code Editor in a wholesale manner, 

instead of adapting it for use in their 

own patient populations. 

We acknowledge that Medicare DRGs 

are sometimes used to classify other 

patient groups. However, CMS’ primary 

focus of updates to the Medicare DRG 

classification system is on changes 

relating to the Medicare patient 

population, not the pediatric or neonatal 

patient populations. 

There are practical considerations 

regarding the assumption of a larger role 

for the Medicare DRG in the pediatric or 

neonatal areas, given the difference 

between the Medicare population and 

that of newborns and children. There 

are also challenges surrounding the 

development of DRG classification 

systems and applications appropriate to 

children. We do not have the clinical 

expertise to make decisions about these 

patients, and must rely on outside 

clinicians for advice. In addition, 

because newborns and other children 

are generally not eligible for Medicare, 

we must rely on outside data to make 

decisions. We recognize that there are 

evolving alternative classification 

systems for children and encourage 

payers to use the CMS MCE as a 

template while making modifications 

appropriate for pediatric patients. 

Therefore, we would encourage those 

non-Medicare systems needing a more 

comprehensive pediatric system of edits 

to update their systems by choosing 

from other existing systems or programs 

that are currently in use. Because of our 

reluctance to assume expertise in the 

pediatric arena, we are not proposing to 

make the commenter’s suggested 

changes to the MCE ‘‘newborn age edit’’

for FY 2006. 

b. Newborn Diagnoses Edit 

Last year, in our changes to the MCE, 

we inadvertently added code 796.6 

(Abnormal findings on neonatal 

screening) to both the MCE edit for 

‘‘Maternity Diagnoses—age 12 through 

55’’, and the MCE edit for ‘‘Diagnoses 

Allowed for Females Only’’. We are 

proposing to remove code 796.6 from 

these two edits and add it to the 

‘‘Newborn Diagnoses’’ edit. 

c. Diagnoses Allowed for ‘‘Males Only’’

Edit 

We have received a request to remove 

two codes from the ‘‘Diagnoses Allowed 

for Males Only’’ edit, related to 

androgen insensitivity syndrome (AIS). 

AIS is a new term for testicular 

feminization. Code 257.8 (Other 

testicular dysfunction) is used to 

describe individuals who, despite 

having XY chromosomes, develop as 

females with normal female genitalia 

and mammary glands. Testicles are 

present in the same general area as the 

ovaries, but are undescended and are at 

risk for development of testicular 

cancer, so are generally surgically 

removed. These individuals have been 

raised as females, and would continue 

to be considered female, despite their 

XY chromosome makeup. Therefore, as 

AIS is coded to 257.8, and has posed a 

problem associated with the gender edit, 

we are proposing to remove this code 

from the ‘‘Males Only’’ edit in the MCE. 

A similar clinical scenario can occur 

with certain disorders that cause a 

defective biosynthesis of testicular 

androgen. This disorder is included in 

code 257.2 (Other testicular 

hypofunction). Therefore, we also are 

proposing to remove code 257.2 from 

the ‘‘Male Only’’ gender edit in the MCE. 

d. Tobacco Use Disorder Edit 

We have become aware of the possible 

need to add code 305.1 (Tobacco use 

disorder) to the MCE in order to make 

admissions for tobacco use disorder a 

noncovered Medicare service when 

code 305.1 is reported as the principal 

diagnosis. On March 22, 2005, CMS 

published a final decision memorandum 

and related national coverage 

determination (NCD) on smoking 

cessation counseling services on its Web 

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

coverage/). Among other things, this 

NCD provides that: ‘‘Inpatient hospital 

stays with the principal diagnosis of 

305.1, Tobacco Use Disorder, are not 

reasonable and necessary for the 

effective delivery of tobacco cessation 

counseling services. Therefore, we will 

not cover tobacco cessation services if 

tobacco cessation is the primary reason 

for the patient’s hospital stay.’’

Therefore, in order to maintain internal 

consistency with CMS programs and 

decisions, we are proposing to add code 

305.1 to the MCE edit ‘‘Questionable 

Admission-Principal Diagnosis Only’’ in 

order to make tobacco use disorder a 

noncovered admission. 

e. Noncovered Procedure Edit 

Effective October 1, 2004, CMS 

adopted the use of code 00.61 

(Percutaneous angioplasty or 

atherectomey of precerebral 

(extracranial) vessel(s) (PTA)) and code 

00.63 (Percutaneous insertion of carotid 

artery stent(s). Both codes are to be 

recorded to indicate the insertion of a 

carotid artery stent or stents. At the time 

of the creation of the codes, the coverage 

indication for carotid artery stenting 

was only for patients in a clinical trial 

setting, and diagnostic code V70.7 

(Examination of participation in a 

clinical trial) was required for payment 

of these cases. However, effective 

October 12, 2004, Medicare covers PTA 

of the carotid artery concurrent with the 

placement of an FDA-approved carotid 

stent for an FDA-approved indication 

when furnished in accordance with 

FDA-approved protocols governing 

post-approval studies. Therefore, as the 

coverage indication has changed, we are 

proposing to remove codes 00.61, 00.63, 

and V70.7 from the MCE noncovered 

procedure edit. 

10. Surgical Hierarchies 

(If you choose to comment on issues 

in this section, please include the 

caption ‘‘Surgical Hierarchy’’ at the 

beginning of your comment.) 

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. 

Therefore, it is necessary to have a 

decision rule within the GROUPER by 

which these cases are assigned to a 

single DRG. The surgical hierarchy, an 

ordering of surgical classes from most 

resource-intensive to least resourceintensive, performs that function. 

Application of this hierarchy 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 

recalibrations, we reviewed the surgical 

23332 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

hierarchy of each MDC, as we have for 

previous reclassifications and 

recalibrations, to determine if the 

ordering of classes coincides with the 

intensity of resource utilization. 

A surgical class can be composed of 

one or more DRGs. For example, in 

MDC 11, the surgical class ‘‘kidney 

transplant’’ consists of a single DRG 

(DRG 302) and the class ‘‘kidney, ureter 

and major bladder procedures’’ consists 

of three DRGs (DRGs 303, 304, and 305). 

Consequently, in many cases, the 

surgical hierarchy has an impact on 

more than one DRG. The methodology 

for determining the most resourceintensive surgical class involves 

weighting the average resources for each 

DRG by frequency to determine the 

weighted 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. Assume also 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 in the class 

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 from the class with the 

highest average resource utilization to 

that with the lowest, with the exception 

of ‘‘other O.R. procedures’’ as discussed 

below. 

This methodology may occasionally 

result in assignment of a case involving 

multiple procedures 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 

search for the procedure in the most 

resource-intensive surgical class, in 

cases involving multiple procedures, 

this result is sometimes unavoidable. 

We note that, notwithstanding the 

foregoing discussion, there are a few 

instances when a surgical class with a 

lower average charge is ordered above a 

surgical class with a higher average 

charge. For example, the ‘‘other O.R. 

procedures’’ surgical class is uniformly 

ordered last in the surgical hierarchy of 

each MDC in which it occurs, regardless 

of the fact that the average charge for the 

DRG or DRGs in that surgical class may 

be higher than that for other surgical 

classes in the MDC. The ‘‘other O.R. 

procedures’’ class is a group of 

procedures that are only infrequently 

related to the diagnoses in the MDC, but 

are still occasionally performed on 

patients in the MDC with these 

diagnoses. Therefore, assignment to 

these surgical classes should only occur 

if no other surgical class more closely 

related to the diagnoses in the MDC is 

appropriate. 

A second example occurs when the 

difference between the average charges 

for two surgical classes is very small. 

We have found that small differences 

generally do not warrant reordering of 

the hierarchy because, as a result of 

reassigning cases on the basis of the 

hierarchy change, the average charges 

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

average charge than the class ordered 

below it. 

Based on the preliminary 

recalibration of the DRGs, we are 

proposing to revise the surgical 

hierarchy for MDC 5 (Diseases and 

Disorders of the Circulatory System) and 

MDC 8 (Diseases and Disorders of the 

Musculoskeletal System and Connective 

Tissue) as follows: 

In MDC 5, we are proposing to 

reorder—

• DRG 116 (Other Permanent Cardiac 

Pacemaker Implant) above DRG 549 

(Percutaneous Cardiovascular Procedure 

With Drug-Eluting Stent With AMI With 

CC). 

• DRG 549 above DRG 550 

(Percutaneous Cardiovascular Procedure 

With Drug-Eluting Stent With AMI 

Without CC). 

• DRG 550 above DRG 547 

(Percutaneous Cardiovascular Procedure 

With AMI With CC). 

• DRG 547 above DRG 548 

(Percutaneous Cardiovascular Procedure 

With AMI Without CC). 

• DRG 548 above DRG 527 

(Percutaneous Cardiovascular Procedure 

With Drug-Eluting Stent Without AMI). 

• DRG 527 above DRG 517 

(Percutaneous Cardiovascular Procedure 

With Non-Drug Eluting Stent Without 

AMI). 

• DRG 517 above DRG 518 

(Percutaneous Cardiovascular Procedure 

Without Coronary Artery Stent or AMI). 

• DRG 518 above DRGs 478 and 479 

(Other Vascular Procedures With and 

Without CC, respectively). 

In MDC 8, we are proposing to 

reorder—

• DRG 496 (Combined Anterior/ 

Posterior Spinal Fusion) above DRG 546 

(Spinal Fusion Except Cervical With 

Principal Diagnosis of Curvature of the 

Spine or Malignancy). 

• DRG 546 above DRGs 497 and 498 

(Spinal Fusion Except Cervical With 

and Without CC, respectively). 

• DRG 217 (Wound Debridement and 

Skin Graft Except Hand, For 

Musculoskeletal and Connective Tissue 

Disease) above DRG 545 (Revision of 

Hip or Knee Replacement). 

• DRG 545 above DRG 544 (Major 

Joint Replacement or Reattachment). 

• DRG 544 above DRGs 519 and 520 

(Cervical Spinal Fusion With and 

Without CC, respectively). 

11. Refinement of Complications and 

Comorbidities (CC) List 

(If you choose to comment on issues 

in this section, please include the 

caption ‘‘CC List’’ at the beginning of 

your comment.) 

a. Background 

As indicated earlier in this preamble, 

under the IPPS DRG classification 

system, we have developed a standard 

list of diagnoses that are considered 

complications or comorbidities (CCs). 

Historically, we developed this list 

using physician panels that classified 

each diagnosis code based on whether 

the diagnosis, when present as a 

secondary condition, would be 

considered a substantial complication or 

comorbidity. A substantial complication 

or comorbidity was defined as a 

condition that, because of its presence 

with a specific principal diagnosis, 

would cause an increase in the length of 

stay by at least 1 day in at least 75 

percent of the patients. 

b. Comprehensive Review of the CC List 

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, but we have 

never conducted a comprehensive 

review of the list. There are currently 

3,285 diagnosis codes on the CC list. 

There are 121-paired DRGs that are split 

on the presence or absence of a CC. 

We have reviewed these paired DRGs 

and found that the majority of cases that 

are assigned to DRGs that have a CC 

split fall into the DRG with CC. While 

this fact is not new, we have found that 

a much higher proportion of cases are 

being grouped to the DRG with a CC 

than had occurred in the past. In our 

review of the DRGs included in Table 7b 

of the September 1, 1987 Federal 

Register rule (52 FR 33125), we found 

the following percentages of cases 

assigned a CC in those DRGs that had a 

CC split (DRG Definitions Manual, 

GROUPER Version 5.0 (1986 data)): 

• Cases with CC: 61.9 percent. 

• Cases without CC: 38.1 percent. 

When we compared the above DRG 

1986 data to the DRG 2004 data that 

were included in the DRGs Definitions 

Manual, GROUPER Version 22.0, we 

found the following: 

• Cases with CC: 79.9 percent. 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23333 

• Cases without CC: 20.1 percent. 

(We used DRGs Definitions Manual, 

GROUPER Version 5.0, for this analysis 

because prior versions of the DRGs 

Definitions Manual used age as a 

surrogate for a CC and the split was ‘‘CC 

and/or age greater than 69’’.) 

The vast majority of patients being 

treated in inpatient settings have a CC 

as currently defined, and we believe 

that it is possible that the CC distinction 

has lost much of its ability to 

differentiate the resource needs of 

patients. The original definition used to 

develop the CC list (the presence of a CC 

would be expected to extend the length 

of stay of at least 75 percent of the 

patients who had the CC by at least one 

day) was used beginning in 1981 and 

has been part of the IPPS since its 

inception in 1983. There has been no 

substantive review of the CC list since 

its original development. In reviewing 

this issue, our clinical experts found 

several diseases that appear to be 

obvious candidates to be on the CC list, 

but currently are not: 

Conversely, our medical experts 

believe the following conditions are 

examples of common conditions that are 

on the CC list, but are not likely to lead 

to higher treatment costs when present 

as a secondary diagnosis: 

We note that the above conditions are 

examples only of why we believe the CC 

list needs a comprehensive review. In 

addition to this review, we note that 

these conditions may be treated 

differently under several DRG systems 

currently in use. For instance, ICD–9–

CM code 414.12 (Dissection of coronary 

artery) is listed as a ‘‘Major CC’’ under 

the All Patient (AP) DRGs, GROUPER 

Version 21.0 and an ‘‘Extreme’’ CC 

under the All Patient Refined (APR) 

DRGs, GROUPER Version 20.0, but is 

not listed as a CC at all in GROUPER 

Version 22.0 of the DRGs Definitions 

Manual used by Medicare. Similarly, 

ICD–9–CM code 424.0 (Mitral valve 

disorder) is a CC under GROUPER 

Version 22.0 of the DRGs Definitions 

Manual for Medicare’s DRG system, a 

minor CC under the GROUPER Version 

20.0 of the APR–DRGs, and not a CC at 

all under GROUPER Version 21.0 of the 

AP–DRGs. 

Given the long period of time that has 

elapsed since the original CC list was 

developed, the incremental nature of 

changes to it, and changes in the way 

inpatient care is delivered, we are 

planning a comprehensive and 

systematic review of the CC list for the 

IPPS rule for FY 2007. As part of this 

process, we plan to consider revising 

the standard for determining when a 

condition is a CC. For instance, we may 

use an alternative to classifying a 

condition as a CC based on how it 

affects the length of stay of a case. 

Similar to other aspects of the DRG 

system, we may consider the effect of a 

specific secondary diagnosis on the 

charges or costs of a case to evaluate 

whether to include the condition on the 

CC list. Using a statistical algorithm, we 

may classify each diagnosis based on its 

effect on hospital charges (or costs) 

relative to other cases when present as 

a secondary diagnosis to obtain better 

information on when a particular 

condition is likely to increase hospital 

costs. For example, Code 293.84 

(Anxiety disorder in conditions 

classified elsewhere), which is currently 

listed as a CC, might be removed from 

the CC list if analysis of the data do not 

support the fact that it represents a 

significant increase in resource 

utilization, and a code such as 359.4 

(Toxic myopathy), which is currently 

not listed as a CC, could be added to the 

CC list if the data support it. In addition 

to using hospital charge data as a basis 

for a review, we would expect to 

supplement the process with review by 

our medical experts. Further, we may 

also consider doing a comparison of the 

Medicare DRG CC list with other DRG 

systems such as the AP–DRGs and the 

APR–DRGs to determine how the same 

secondary diagnoses are treated under 

these systems. 


EP04MY05.014</GPH> EP04my05.015</GPH>
23334 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

1See the FY 1989 final rule (53 FR 38485) 

[September 30, 1988] for the revision made for the 

discharges occurring in FY 1989; the FY 1990 final 

rule (54 FR 36552) [September 1, 1989] for the FY 

1990 revision; the FY 1991 final rule (55 FR 36126) 

[September 4, 1990] for the FY 1991 revision; the 

FY 1992 final rule (56 FR 43209) [August 30, 1991] 

for the FY 1992 revision; the FY 1993 final rule (57 

FR 39753) [September 1, 1992] for the FY 1993 

revision; the FY 1994 final rule (58 FR 46278) 

[September 1, 1993] for the FY 1994 revisions; the 

FY 1995 final rule (59 FR 45334) [September 1, 

1994] for the FY 1995 revisions; the FY 1996 final 

rule (60 FR 45782) [September 1, 1995] for the FY 

1996 revisions; the FY 1997 final rule (61 FR 46171) 

[August 30, 1996] for the FY 1997 revisions; the FY 

1998 final rule (62 FR 45966) [August 29, 1997] for 

the FY 1998 revisions; the FY 1999 final rule (63 

FR 40954) [July 31, 1998] for the FY 1999 revisions; 

the FY 2001 final rule (65 FR 47064) [August 1, 

2000] for the FY 2001 revisions; the FY 2002 final 

rule (66 FR 39851) [August 1, 2001] for the FY 2002 

revisions; the FY 2003 final rule (67 FR 49998) 

[August 1, 2002] for the FY 2003 revisions; the FY 

2004 final rule (68 FR 45364) [August 1, 2003] for 

the FY 2004 revisions; and the FY 2005 final rule 

(69 FR 49848) [August 11, 2004] for the FY 2005 

revisions. In the FY 2000 final rule (64 FR 41490) 

[July 30, 1999], we did not modify the CC 

Exclusions List because we did not make any 

changes to the ICD–9–CM codes for FY 2000. 

By performing a comprehensive 

review of the CC list, we expect to revise 

the DRG classification system to better 

reflect resource utilization and remove 

conditions from the CC list that only 

have a marginal impact on a hospital’s 

costs. We believe that a comprehensive 

review of the CC list would be 

consistent with MedPAC’s 

recommendation that we improve the 

DRG system to better recognize severity. 

We will provide more detail about how 

we expect to undertake this analysis in 

the future, and any changes to the CC 

list will only be adopted after a notice 

and comment rulemaking that fully 

explains the methodology we plan to 

use in conducting this review. We 

encourage comment at this time 

regarding possible ways that more 

meaningful indicators of clinical 

severity and their implications for 

resource use can be incorporated into 

our comprehensive review and possible 

restructuring of the CC list. 

c. CC Exclusions List for FY 2006 

In the September 1, 1987 final notice 

(52 FR 33143) concerning changes to the 

DRG classification system, we modified 

the GROUPER logic so that certain 

diagnoses included on the standard list 

of CCs would not be considered valid 

CCs in combination with a particular 

principal diagnosis. We created the CC 

Exclusions List for the following 

reasons: (1) to preclude coding of CCs 

for closely related conditions; (2) to 

preclude duplicative or inconsistent 

coding from being treated as CCs; and 

(3) to ensure that cases are appropriately 

classified between the complicated and 

uncomplicated DRGs in a pair. As we 

indicated above, we developed this list 

of diagnoses, 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 list of CCs, either by adding new 

CCs or deleting CCs already on the list. 

At this time, we are not proposing to 

delete any of the diagnosis codes on the 

CC list for FY 2006. 

In the May 19, 1987 proposed notice 

(52 FR 18877) and the September 1, 

1987 final notice (52 FR 33154), 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. 

• Specific and nonspecific (that is, 

not otherwise specified (NOS)) 

diagnosis codes for the same condition 

should not be considered CCs for one 

another. 

• Codes for the same condition that 

cannot coexist, such as partial/total, 

unilateral/bilateral, obstructed/ 

unobstructed, and benign/malignant, 

should not be considered CCs for one 

another. 

• Codes for 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 

of codes. 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.1

We are proposing a limited revision of 

the CC Exclusions List to take into 

account the proposed changes that will 

be made in the ICD–9–CM diagnosis 

coding system effective October 1, 2004. 

(See section II.B.13. of this preamble for 

a discussion of ICD–9–CM changes.) We 

are proposing these changes in 

accordance with the principles 

established when we created the CC 

Exclusions List in 1987. 

Tables 6G and 6H in the Addendum 

to this proposed rule contain the 

revisions to the CC Exclusions List that 

would be effective for discharges 

occurring on or after October 1, 2005. 

Each table shows the principal 

diagnoses with 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 6G—Additions to the CC 

Exclusions List. Beginning with 

discharges on or after October 1, 2005, 

the indented diagnoses would not be 

recognized by the GROUPER as valid 

CCs for the asterisked principal 

diagnosis. 

CCs that are deleted from the list are 

in Table 6H—Deletions from the CC 

Exclusions List. Beginning with 

discharges on or after October 1, 2005, 

the indented diagnoses would 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 $152.50 plus 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, VA 22161; 

or by calling (800) 553–6847. 

Users should be aware of the fact that 

all revisions to the CC Exclusions List 

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

1994, 1995, 1996, 1997, 1998, 1999, 

2001, 2002, 2003, 2004, and 2005) and 

those in Tables 6G and 6H of this 

proposed rule for FY 2006 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, 2005. (Note: There was no CC 

Exclusions List in FY 2000 because we 

did not make changes to the ICD–9–CM 

codes for FY 2000.) 

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 CMS, is responsible 

for updating and maintaining the 

GROUPER program. The current DRG 

Definitions Manual, Version 22.0, is 

available for $225.00, which includes 

$15.00 for shipping and handling. 

Version 23.0 of this manual, which will 

include the final FY 2006 DRG changes, 

will be available for $225.00. These 

manuals may be obtained by writing 

3M/HIS at the following address: 100 

Barnes Road, Wallingford, CT 06492; or 

by calling (203) 949–0303. Please 

specify the revision or revisions 

requested. 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23335 

2The 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 FY 1989 final 

rule (53 FR 38591). As part of the FY 1991 final rule 

(55 FR 36135), the FY 1992 final rule (56 FR 43212), 

the FY 1993 final rule (57 FR 23625), the FY 1994 

final rule (58 FR 46279), the FY 1995 final rule (59 

FR 45336), the FY 1996 final rule (60 FR 45783), 

the FY 1997 final rule (61 FR 46173), and the FY 

1998 final rule (62 FR 45981), we moved several 

other procedures from DRG 468 to DRG 477, and 

some procedures from DRG 477 to DRG 468. No 

procedures were moved in FY 1999, as noted in the 

final rule (63 FR 40962); in FY 2000 (64 FR 41496); 

in FY 2001 (65 FR 47064); or in FY 2002 (66 FR 

39852). In the FY 2003 final rule (67 FR 49999) we 

did not move any procedures from DRG 477. 

However, we did move procedure codes from DRG 

468 and placed them in more clinically coherent 

DRGs. In the FY 2004 final rule (68 FR 45365), we 

moved several procedures from DRG 468 to DRGs 

476 and 477 because the procedures are 

nonextensive. In the FY 2005 final rule (69 FR 

48950), we moved one procedure from DRG 468 to 

477. In addition, we added several existing 

procedures to DRGs 476 and 477. 

12. Review of Procedure Codes in DRGs 

468, 476, and 477 

(If you choose to comment on issues 

in this section, please include the 

caption ‘‘DRGs 468, 476, and 477’’ at the 

beginning of your comment.) 

Each year, we review cases assigned 

to DRG 468 (Extensive O.R. Procedure 

Unrelated to Principal Diagnosis), DRG 

476 (Prostatic O.R. Procedure Unrelated 

to Principal Diagnosis), and DRG 477 

(Nonextensive O.R. Procedure Unrelated 

to Principal Diagnosis) 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 

O.R. procedures performed are 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, not elsewhere 

classified. 

• 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. 

• 60.96, Transurethral destruction of 

prostate tissue by microwave 

thermotherapy. 

• 60.97, Other transurethral 

destruction of prostate tissue by other 

thermotherapy. 

• 60.99, Other operations on prostate. 

All remaining O.R. 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.2

a. Moving Procedure Codes From DRG 

468 or DRG 477 to MDCs 

We annually conduct a review of 

procedures producing assignment to 

DRG 468 or DRG 477 on the basis of 

volume, by procedure, to see if it would 

be appropriate to move procedure codes 

out of these DRGs into one of the 

surgical DRGs for the MDC into which 

the principal diagnosis falls. The data 

are arrayed two ways for comparison 

purposes. We look at a frequency count 

of each major operative procedure code. 

We also compare procedures across 

MDCs by volume of procedure codes 

within each MDC. 

We identify those procedures 

occurring in conjunction with certain 

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 did not identify any 

procedures in DRGs 468 or 477 that 

should be removed to one of the surgical 

DRGs. Therefore, in this proposed rule, 

we are not proposing any changes for 

FY 2006. 

b. Reassignment of Procedures Among 

DRGs 468, 476, and 477 

We also annually review the list of 

ICD–9–CM procedures that, when in 

combination with their principal 

diagnosis code, result in assignment to 

DRGs 468, 476, and 477, to ascertain if 

any of those procedures should be 

reassigned from one of these three DRGs 

to another of the three DRGs based on 

average charges and the length of stay. 

We look at the data for trends such as 

shifts in treatment practice or reporting 

practice that would make the resulting 

DRG assignment illogical. If we find 

these shifts, we would propose to move 

cases to keep the DRGs clinically similar 

or to provide payment for the cases in 

a similar manner. Generally, we move 

only those procedures for which we 

have an adequate number of discharges 

to analyze the data. 

It has come to our attention that 

procedure code 26.12 (Open biopsy of 

salivary gland or duct) is assigned to 

DRG 468 (Extensive O.R. Procedure 

Unrelated to Principal Diagnosis). We 

believe this to be an error, as code 26.31 

(Partial sialoadenectomy), which is a 

more extensive procedure than code 

26.12, is assigned to DRG 477. 

Therefore, we are proposing to correct 

this error by moving code 26.12 out of 

DRG 468 and reassigning it to DRG 477. 

We are not proposing to move any 

procedure codes from DRG 476 to DRGs 

468 or 477, or from DRG 477 to DRGs 

468 or 476. 

c. Adding Diagnosis or Procedure Codes 

to MDCs 

Based on our review this year, we are 

not proposing to add any diagnosis 

codes to MDCs. 

13. Changes to the ICD–9–CM Coding 

System 

As described in section II.B.1. of this 

preamble, the ICD–9–CM is a coding 

system 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, 

co-chaired by the National Center for 

Health Statistics (NCHS) and CMS, 

charged with maintaining and updating 

the ICD–9–CM system. The Committee 

is jointly responsible for 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 Official Version of the ICD–9-CM 

contains the list of valid diagnosis and 

procedure codes. (The Official Version 

of the ICD–9–CM is available from the 

Government Printing Office on CD–

ROM for $25.00 by calling (202) 512–

1800.) The Official Version of the ICD–

9–CM is no longer available in printed 

manual form from the Federal 

Government; it is only available on CD–

ROM. Users who need a paper version 

are referred to one of the many products 

available from publishing houses. 

The NCHS has lead responsibility for 

the ICD–9–CM diagnosis codes included 

in the Tabular List and Alphabetic 

Index for Diseases, while CMS has lead 

23336 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

responsibility for the ICD–9–CM 

procedure codes included in the 

Tabular List and Alphabetic Index for 

Procedures. 

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 field, such 

as the American Health Information 

Management Association (AHIMA), the 

American Hospital Association (AHA), 

and various physician specialty groups, 

as well as individual 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 for implementation 

in FY 2006 at a public meeting held on 

October 7–8, 2004, and finalized the 

coding changes after consideration of 

comments received at the meetings and 

in writing by January 12, 2005. Those 

coding changes are announced in Tables 

6A through 6F of the Addendum to this 

proposed rule. The Committee held its 

2005 meeting on March 31-April l, 2005. 

Proposed new codes for which there 

was a consensus of public support and 

for which complete tabular and 

indexing charges can be made by May 

2005 will be included in the October 1, 

2005 update to ICD–9–CM. These 

additional codes will be included in 

Tables 6A through 6F of the final rule. 

Copies of the minutes of the 

procedure codes discussions at the 

Committee’s October 7–8, 2004 meeting 

can be obtained from the CMS Web site: 

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

paymentsystems/icd9/. The minutes of 

the diagnoses codes discussions at the 

October 7–8, 2004 meeting are found at: 

http://www.cdc.gov/nchs/icd9.htm. 

Paper copies of these minutes are no 

longer available and the mailing list has 

been discontinued. These Web sites also 

provide detailed information about the 

Committee, including information on 

requesting a new code, attending a 

Committee meeting, and timeline 

requirements and meeting dates. 

We encourage commenters to address 

suggestions on coding issues involving 

diagnosis codes to: Donna Pickett, CoChairperson, ICD–9–CM Coordination 

and Maintenance Committee, NCHS, 

Room 2402, 3311 Toledo Road, 

Hyattsville, MD 20782. Comments may 

be sent by e-mail to: dfp4@cdc.gov. 

Questions and comments concerning 

the procedure codes should be 

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

and Maintenance Committee, CMS, 

Center for Medicare Management, 

Hospital and Ambulatory Policy Group, 

Division of Acute Care, C4–08–06, 7500 

Security Boulevard, Baltimore, MD 

21244–1850. Comments may be sent by 

e-mail to: 

Patricia.Brooks1@cms.hhs.gov. 

The ICD–9–CM code changes that 

have been approved will become 

effective October 1, 2005. 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 the 

Addendum to this proposed rule. As we 

stated above, the code numbers and 

their titles were presented for public 

comment at the ICD–9–CM 

Coordination and Maintenance 

Committee meetings. Both oral and 

written comments were considered 

before the codes were approved. In this 

proposed rule, we are only soliciting 

comments on the proposed 

classification of these new codes. 

For codes that have been replaced by 

new or expanded codes, the 

corresponding new or expanded 

diagnosis codes are included in Table 

6A. New procedure codes are shown in 

Table 6B. Diagnosis codes that have 

been replaced by expanded codes or 

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, 2005. Table 6D 

contains invalid procedure codes. These 

invalid procedure codes will not be 

recognized by the GROUPER beginning 

with discharges occurring on or after 

October 1, 2005. Revisions to diagnosis 

code titles are in Table 6E (Revised 

Diagnosis Code Titles), which also 

includes the DRG assignments for these 

revised codes. Table 6F includes revised 

procedure code titles for FY 2006. 

In the September 7, 2001 final rule 

implementing the IPPS new technology 

add-on payments (66 FR 46906), we 

indicated we would attempt to include 

proposals for procedure codes that 

would describe new technology 

discussed and approved at the April 

meeting as part of the code revisions 

effective the following October. As 

stated previously, ICD–9–CM codes 

discussed at the March 31-April 1, 2005 

Committee meeting that receive 

consensus and that can be finalized by 

May 2005 will be included in Tables 6A 

through 6F of the final rule. 

Section 503(a) of Pub. L. 108–173 

included a requirement for updating 

ICD–9–CM codes twice a year instead of 

a single update on October 1 of each 

year. This requirement was included as 

part of the amendments to the Act 

relating to recognition of new 

technology under the IPPS. Section 

503(a) amended section 1886(d)(5)(K) of 

the Act by adding a clause (vii) which 

states that the ‘‘Secretary shall provide 

for the addition of new diagnosis and 

procedure codes in April 1 of each year, 

but the addition of such codes shall not 

require the Secretary to adjust the 

payment (or diagnosis-related group 

classification) * * * until the fiscal year 

that begins after such date.’’ This 

requirement improves the recognition of 

new technologies under the IPPS system 

by providing information on these new 

technologies at an earlier date. Data will 

be available 6 months earlier than 

would be possible with updates 

occurring only once a year on October 

1. 

While section 503(a) states that the 

addition of new diagnosis and 

procedure codes on April 1 of each year 

shall not require the Secretary to adjust 

the payment, or DRG classification 

under section 1886(d) of the Act until 

the fiscal year that begins after such 

date, we have to update the DRG 

software and other systems in order to 

recognize and accept the new codes. We 

also publicize the code changes and the 

need for a mid-year systems update by 

providers to capture the new codes. 

Hospitals also have to obtain the new 

code books and encoder updates, and 

make other system changes in order to 

capture and report the new codes. 

The ICD–9–CM Coordination and 

Maintenance Committee holds its 

meetings in the Spring and Fall, usually 

in April and September, in order to 

update the codes and the applicable 

payment and reporting systems by 

October 1 of each year. Items are placed 

on the agenda for the ICD–9–CM 

Coordination and Maintenance 

Committee meeting if the request is 

received at least 2 months prior to the 

meeting. This requirement allows time 

for staff to review and research the 

coding issues and prepare material for 

discussion at the meeting. It also allows 

time for the topic to be publicized in 

meeting announcements in the Federal 

Register as well as on the CMS Web site. 

The public decides whether or not to 

attend the meeting based on the topics 

listed on the agenda. Final decisions on 

code title revisions are currently made 

by March 1 so that these titles can be 

included in the IPPS proposed rule. A 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23337 

complete addendum describing details 

of all changes to ICD–9–CM, both 

tabular and index, are publicized on 

CMS and NCHS Web pages in May of 

each year. Publishers of coding books 

and software use this information to 

modify their products that are used by 

health care providers. This 5-month 

time period has proved to be necessary 

for hospitals and other providers to 

update their systems. 

A discussion of this timeline and the 

need for changes are included in the 

December 4–5, 2003 ICD–9–CM 

Coordination and Maintenance 

Committee minutes. The public agreed 

that there was a need to hold the fall 

meetings earlier, in September or 

October, in order to meet the new 

implementation dates. The public 

provided comment that additional time 

would be needed to update hospital 

systems and obtain new code books and 

coding software. There was considerable 

concern expressed about the impact this 

new April update would have on 

providers. 

In the FY 2005 IPPS final rule, we 

implemented section 503(a) by 

developing a mechanism for approving, 

in time for the April update, diagnoses 

and procedure code revisions needed to 

describe new technologies and medical 

services for purposes of the new 

technology add-on payment process. We 

also established the following process 

for making these determinations. Topics 

considered during the Fall ICD–9–CM 

Coordination and Maintenance 

Committee meeting are considered for 

an April 1 update if a strong and 

convincing case is made by the 

requester at the Committee’s public 

meeting. The request must identify the 

reason why a new code is needed in 

April for purposes of the new 

technology process. The participants at 

the meeting and those reviewing the 

Committee meeting summary report are 

provided the opportunity to comment 

on this expedited request. All other 

topics are considered for the October 1 

update. Participants at the Committee 

meeting are encouraged to comment on 

all such requests. There were no 

requests for an expedited April l, 2005 

implementation of an ICD–9–CM code 

at the October 7–8, 2004 Committee 

meeting. Therefore, there were no new 

ICD–9–CM codes implemented on April 

1, 2005. 

We believe that this process captures 

the intent of section 503(a). This 

requirement was included in the 

provision revising the standards and 

process for recognizing new technology 

under the IPPS. In addition, the need for 

approval of new codes outside the 

existing cycle (October 1) arises most 

frequently and most acutely where the 

new codes will capture new 

technologies that are (or will be) under 

consideration for new technology addon payments. Thus, we believe this 

provision was intended to expedite data 

collection through the assignment of 

new ICD–9–CM codes for new 

technologies seeking higher payments. 

Current addendum and code title 

information is published on the CMS 

Web page at: http://www.cms.hhs.gov/ 

paymentsystems/icd9. Summary tables 

showing new, revised, and deleted code 

titles are also posted on the following 

CMS Web page: http:// 

www.cms.hhs.gov/medlearn/ 

icd9code.asp. Information on ICD–9–

CM diagnosis codes, along with the 

Official ICD–9–CM Coding Guidelines, 

can be found on the Wep page at: http:// 

www.cdc.gov/nchs/icd9.htm. 

Information on new, revised, and 

deleted ICD–9–CM codes is also 

provided to the AHA for publication in 

the Coding Clinic for ICD–9–CM. AHA 

also distributes information to 

publishers and software vendors. 

CMS also sends copies of all ICD–9–

CM coding changes to its contractors for 

use in updating their systems and 

providing education to providers. 

These same means of disseminating 

information on new, revised, and 

deleted ICD–9–CM codes will be used to 

notify providers, publishers, software 

vendors, contractors, and others of any 

changes to the ICD–9–CM codes that are 

implemented in April. Currently, code 

titles are also published in the IPPS 

proposed and final rules. The code titles 

are adopted as part of the ICD–9–CM 

Coordination and Maintenance 

Committee process. The code titles are 

not subject to comment in the proposed 

or final rules. We will continue to 

publish the October code updates in this 

manner within the IPPS proposed and 

final rules. For codes that are 

implemented in April, we will assign 

the new procedure code to the same 

DRG in which its predecessor code was 

assigned so there will be no DRG impact 

as far as DRG assignment. This mapping 

was specified by Pub. L. 108–173. Any 

midyear coding updates will be 

available through the websites indicated 

above and through the Coding Clinic for 

ICD–9–CM. Publishers and software 

vendors currently obtain code changes 

through these sources in order to update 

their code books and software systems. 

We will strive to have the April 1 

updates available through these 

websites 5 months prior to 

implementation (that is, early November 

of the previous year), as is the case for 

the October 1 updates. Codebook 

publishers are evaluating how they will 

provide any code updates to their 

subscribers. Some publishers may 

decide to publish mid-year book 

updates. Others may decide to sell an 

addendum that lists the changes to the 

October 1 code book. Coding personnel 

should contact publishers to determine 

how they will update their books. CMS 

and its contractors will also consider 

developing provider education articles 

concerning this change to the effective 

date of certain ICD–9–CM codes. 

14. Other Issues: Acute Intermittent 

Porphyria 

Acute intermittent porphyria is a rare 

metabolic disorder. The condition is 

described by code 277.1 (Disorders of 

porphyrin metabolism). Code 277.1 is 

assigned to DRG 299 (Inborn Errors of 

Metabolism) under MDC 10 (Endocrine, 

Nutritional, and Metabolic Diseases and 

Disorders). 

In the FY 2005 final rule (69 FR 

48981), we discussed the DRG 

assignment of acute intermittent 

porphyria. This discussion was a result 

of correspondence that we received 

during the comment period for the FY 

2005 proposed rule in which the 

commenter suggested that Medicare 

hospitalization payments do not 

accurately reflect the cost of treatment. 

At that time, we indicated that we 

would take this comment into 

consideration when we analyzed the 

MedPAR data for this proposed rule for 

FY 2006. 

Our review of the most recent 

MedPAR data shows a total of 1,370 

cases overall in DRG 299, of which 471 

had a principal diagnosis coded as 

277.1. The average length of stay for all 

cases in DRG 299 was 5.17 days, while 

the average length of stay for porphyria 

cases with code 277.1 was 6.0 days. The 

average charges for all cases in DRG 299 

were $15,891, while the average changes 

for porphyria cases with code 277.1 

were $21,920. Based on our analysis of 

these data, we do not believe that there 

is a sufficient difference between the 

average charges and average length of 

stay for these cases to justify a change 

to the DRG assignment for treating this 

condition. 

C. Proposed Recalibration of DRG 

Weights 

(If you choose to comment on issues 

in this section, please include the 

caption ‘‘DRG Weights’’ at the beginning 

of your comment.) 

We are proposing to use the same 

basic methodology for the FY 2006 

recalibration as we did for FY 2005 (FY 

2005 IPPS final rule (69 FR 48981)). 

That is, we have recalibrated the DRG 

weights based on charge data for 

23338 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

Medicare discharges using the most 

current charge information available 

(the FY 2004 MedPAR file). 

The MedPAR file is based on fully 

coded diagnostic and procedure data for 

all Medicare inpatient hospital bills. 

The FY 2004 MedPAR data used in this 

final rule include discharges occurring 

between October 1, 2003 and September 

30, 2004, based on bills received by 

CMS through December 31, 2004, from 

all hospitals subject to the IPPS and 

short-term acute care hospitals in 

Maryland (which are under a waiver 

from the IPPS under section 1814(b)(3) 

of the Act). The FY 2004 MedPAR file 

includes data for approximately 

11,910,025 Medicare discharges. 

Discharges for Medicare beneficiaries 

enrolled in a Medicare+Choice managed 

care plan are excluded from this 

analysis. The data excludes CAHs, 

including hospitals that subsequently 

became CAHs after the period from 

which the data were taken. 

The proposed methodology used to 

calculate the DRG relative weights from 

the FY 2004 MedPAR file is as follows: 

• To the extent possible, all the 

claims were regrouped using the DRG 

classification revisions discussed in 

section II.B. of this preamble. 

• The transplant cases that were used 

to establish the relative weight for heart 

and heart-lung, liver, and lung 

transplants (DRGs 103, 480, and 495) 

were limited to those Medicareapproved transplant centers that have 

cases in the FY 2004 MedPAR file. 

(Medicare coverage for heart, heart-lung, 

liver, and lung transplants is limited to 

those facilities that have received 

approval from CMS as transplant 

centers.) 

• Organ acquisition costs for kidney, 

heart, heart-lung, liver, lung, pancreas, 

and intestinal (or multivisceral organs) 

transplants continue to be paid on a 

reasonable cost basis. Because these 

acquisition costs are paid separately 

from the prospective payment rate, it is 

necessary to subtract 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. 

• Charges were standardized to 

remove the effects of differences in area 

wage levels, indirect medical education 

and 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. 

A transfer case is counted as a fraction 

of a case based on the ratio of its transfer 

payment under the per diem payment 

methodology to the full DRG payment 

for nontransfer cases. That is, a transfer 

case receiving payment under the 

transfer methodology equal to half of 

what the case would receive as a 

nontransfer would be counted as 0.5 of 

a total case. 

• Statistical outliers were eliminated 

by removing all cases that are beyond 

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. 

The proposed new weights are 

normalized by an adjustment factor of 

1.47263 so that the average case weight 

after recalibration is equal to the average 

case weight before recalibration. This 

proposed adjustment is intended to 

ensure that recalibration by itself 

neither increases nor decreases total 

payments under the IPPS. 

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 used that same 

case threshold in recalibrating the 

proposed DRG weights for FY 2006. 

Using the FY 2004 MedPAR data set, 

there are 41 DRGs that contain fewer 

than 10 cases. We are proposing to 

compute the weights for these lowvolume DRGs by adjusting the FY 2005 

weights of these DRGs by the percentage 

change in the average weight of the 

cases in the other DRGs. 

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 payments 

to hospitals are 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 proposed rule, we are 

making a budget neutrality adjustment 

to ensure that the requirement of section 

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

D. Proposed LTC–DRG Reclassifications 

and Relative Weights for LTCHs for FY 

2006 

(If you choose to comment on issues 

in this section, please include the 

caption ‘‘LTC–DRGs’’ at the beginning of 

your comment.) 

1. Background 

In the June 6, 2003 LTCH PPS final 

rule (68 FR 34122), we changed the 

LTCH PPS annual payment rate update 

cycle to be effective July 1 through June 

30 instead of October 1 through 

September 30. In addition, because the 

patient classification system utilized 

under the LTCH PPS is based directly 

on the DRGs used under the IPPS for 

acute care hospitals, in that same final 

rule, we explained that the annual 

update of the long-term care diagnosisrelated group (LTC–DRG) classifications 

and relative weights will continue to 

remain linked to the annual 

reclassification and recalibration of the 

CMS–DRGs used under the IPPS. In that 

same final rule, we specified that we 

will continue to update the LTC–DRG 

classifications and relative weights to be 

effective for discharges occurring on or 

after October 1 through September 30 

each year. Furthermore, we stated that 

we will publish the annual update of 

the LTC–DRGs in the proposed and final 

rules for the IPPS. 

In the past, the annual update to the 

IPPS DRGs has been based on the 

annual revisions to the ICD–9–CM codes 

and was effective each October 1. As 

discussed in the FY 2005 IPPS final rule 

(69 FR 48954 through 48957) and in the 

February 3, 2005 LTCH PPS proposed 

rule (70 FR 5729 through 5733), with 

the implementation of section 503 (a) of 

Pub. L. 108–173, there is the possibility 

that one feature of the GROUPER 

software program may be updated twice 

during a Federal fiscal year (October 1 

and April 1) as required by the statute 

for the IPPS. Specifically, ICD–9–CM 

diagnosis and procedure codes for new 

medical technology may be created and 

added to existing DRGs in the middle of 

the Federal fiscal year on April 1. This 

policy change will have no effect, 

however, on the LTC–DRG relative 

weights which will continue to be 

updated only once a year (October 1), 

nor will there be any impact on 

Medicare payments under the LTCH 

PPS. The use of the ICD–9–CM code set 

is also compliant with the current 

requirements of the Transactions and 

Code Sets Standards regulations at 45 

CFR Parts 160 and 162, promulgated in 

accordance with the Health Insurance 

Portability and Accountability Act of 

1996 (HIPAA), Pub. L. 104–191. 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23339 

In the health care industry, 

historically annual changes to the ICD–

9–CM codes were effective for 

discharges occurring on or after October 

1 each year. Thus, the manual and 

electronic versions of the GROUPER 

software, which are based on the ICD–

9–CM codes, were also revised annually 

and effective for discharges occurring on 

or after October 1 each year. As noted 

above, the patient classification system 

used under the LTCH PPS (LTC–DRGs) 

is based on the patient classification 

system used under the IPPS (CMS–

DRGs), which historically had been 

updated annually and effective for 

discharges occurring on or after October 

1 through September 30 each year. As 

mentioned above, the ICD–9–CM coding 

update process has been revised, as 

discussed in greater detail in the FY 

2005 IPPS final rule (69 FR 48954 

through 48957). Specifically, section 

503(a) of Pub. L. 108–173 includes a 

requirement for updating ICD–9–CM 

codes as often as twice a year instead of 

the current process of annual updates 

on October 1 of each year. This 

requirement is included as part of the 

amendments to the Act relating to 

recognition of new medical technology 

under the IPPS. Section 503(a) of Pub L. 

108–173 amended section 1886(d)(5)(K) 

of the Act by adding a new clause (vii) 

which states that ‘‘the Secretary shall 

provide for the addition of new 

diagnosis and procedure codes in [sic] 

April 1 of each year, but the addition of 

such codes shall not require the 

Secretary to adjust the payment (or 

diagnosis-related group classification) 

* * * until the fiscal year that begins 

after such date.’’ This requirement will 

improve the recognition of new 

technologies under the IPPS by 

accounting for those ICD–9–CM codes 

in the MedPAR claims data at an earlier 

date. Despite the fact that aspects of the 

GROUPER software may be updated to 

recognize any new technology ICD–9–

CM codes, as discussed in the February 

3, 2005 LTCH PPS proposed rule (70 FR 

5730 through 5733), there will be no 

impact on either LTC–DRG assignments 

or payments under the LTCH PPS at that 

time. That is, changes to the LTC–DRGs 

(such as the creation or deletion of LTC–

DRGs) and the relative weights will 

continue to be updated in the manner 

and timing (October 1) as they are now. 

As noted above and as described in 

the February 3, 2005 LTCH PPS 

proposed rule (70 FR 5730), updates to 

the GROUPER for both the IPPS and the 

LTCH PPS (with respect to relative 

weights and the creation or deletion of 

DRGs) are made in the annual IPPS 

proposed and final rules and are 

effective each October 1. We explained 

in the FY 2005 IPPS final rule (69 FR 

48955 and 48956), that since we do not 

publish a midyear IPPS rule, April 1 

code updates discussed above will not 

be published in a midyear IPPS rule. 

Rather, we will assign any new 

diagnostic or procedure codes to the 

same DRG in which its predecessor code 

was assigned, so that there will be no 

impact on the DRG assignments. Any 

proposed coding updates will be 

available through the websites indicated 

in the same rule and provided above in 

section II.B. of this preamble and 

through the Coding Clinic for ICD–9–

CM. Publishers and software vendors 

currently obtain code changes through 

these sources in order to update their 

code books and software system. If new 

codes are implemented on April 1, 

revised code books and software 

systems, including the GROUPER 

software program, will be necessary 

because we must use current ICD–9–CM 

codes. Therefore, for purposes of the 

LTCH PPS, since each ICD–9–CM code 

must be included in the GROUPER 

algorithm to classify each case into a 

LTC–DRG, the GROUPER software 

program used under the LTCH PPS 

would need to be revised to 

accommodate any new codes. 

As we discussed in the FY 2005 IPPS 

final rule (69 FR 48956), in 

implementing section 503(a) of Pub. L. 

108–173, there will only be an April 1 

update if new technology codes are 

requested and approved. It should be 

noted that any new codes created for 

April 1 implementation will be limited 

to those diagnosis and procedure code 

revisions primarily needed to describe 

new technologies and medical services. 

However, we reiterate that the process 

of discussing updates to the ICD–9–CM 

has been an open process through the 

ICD–9–CM C&M Committee since 1995. 

Requestors will be given the 

opportunity to present the merits of 

their proposed new code and make a 

clear and convincing case for the need 

to update ICD–9–CM codes for purposes 

of the IPPS new technology add-on 

payment process through an April 1 

update. 

In addition, in the FY 2005 IPPS final 

rule (69 FR 48956), we stated that at the 

October 2004 ICD–9–CM Coordination 

and Maintenance Committee meeting, 

no new codes were proposed for an 

April 1, 2005 implementation, and the 

next update to the ICD–9–CM coding 

system would not occur until October 1, 

2005 (FY 2006). Presently, as there were 

no coding changes suggested for an 

April 1, 2005 update, the ICD–9–CM 

coding set implemented on October 1, 

2004 will continue through September 

30, 2005 (FY 2005). The proposed 

update to the ICD–9–CM coding system 

for FY 2006 is discussed above in 

section II.B. of this preamble. 

In this proposed rule, we are 

proposing revisions to the LTC–DRG 

classifications and relative weights and, 

to the extent that they are finalized, we 

will publish them in the corresponding 

IPPS final rule, to be effective October 

1, 2005 through September 30, 2006 (FY 

2006), using the latest available data. 

The proposed LTC–DRGs and relative 

weights for FY 2006 in this proposed 

rule are based on the proposed IPPS 

DRGs (GROUPER Version 23.0) 

discussed in section II. of this proposed 

rule. 

2. Proposed Changes in the LTC–DRG 

Classifications 

a. Background 

Section 123 of Pub. L. 106–113 

specifically requires that the PPS for 

LTCHs be a per discharge system with 

a DRG-based patient classification 

system reflecting the differences in 

patient resources and costs in LTCHs 

while maintaining budget neutrality. 

Section 307(b)(1) of Pub. L. 106–554 

modified the requirements of section 

123 of Pub. L. 106–113 by specifically 

requiring that the Secretary examine 

‘‘the feasibility and the impact of basing 

payment under such a system [the 

LTCH PPS] on the use of existing (or 

refined) hospital diagnosis-related 

groups (DRGs) that have been modified 

to account for different resource use of 

long-term care hospital patients as well 

as the use of the most recently available 

hospital discharge data.’’

In accordance with section 307(b)(1) 

of Pub. L. 106–554 and § 412.515 of our 

existing regulations, the LTCH PPS uses 

information from LTCH patient records 

to classify patient cases into distinct 

LTC–DRGs based on clinical 

characteristics and expected resource 

needs. The LTC–DRGs used as the 

patient classification component of the 

LTCH PPS correspond to the DRGs 

under the IPPS for acute care hospitals. 

Thus, in this proposed rule, we are 

proposing to use the IPPS GROUPER 

Version 23.0 for FY 2006 to process 

LTCH PPS claims for LTCH occurring 

from October 1, 2005 through 

September 30, 2006. The proposed 

changes to the CMS DRG classification 

system used under the IPPS for FY 2006 

(GROUPER Version 23.0) are discussed 

in section II.B. of the preamble to this 

proposed rule. 

Under the LTCH PPS, we determine 

relative weights for each of the CMS 

DRGs to account for the difference in 

resource use by patients exhibiting the 

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case complexity and multiple medical 

problems characteristic of LTCH 

patients. In a departure from the IPPS, 

as we discussed in the August 30, 2002 

LTCH PPS final rule (67 FR 55985), 

which implemented the LTCH PPS, and 

the FY 2004 IPPS final rule (68 FR 

45374), we use low-volume quintiles in 

determining the LTC–DRG weights for 

LTC–DRGs with less than 25 LTCH 

cases, because LTCHs do not typically 

treat the full range of diagnoses as do 

acute care hospitals. Specifically, we 

group those low-volume LTC–DRGs 

(LTC–DRGs with fewer than 25 cases) 

into 5 quintiles based on average charge 

per discharge. (A listing of the 

composition of low-volume quintiles for 

the FY 2005 LTC–DRGs (based on FY 

2003 MedPAR data) appears in section 

II.D.3. of the FY 2005 IPPS final rule (69 

FR 48985 through 48989).) We also 

adjust for cases in which the stay at the 

LTCH is less than or equal to five-sixths 

of the geometric average length of stay; 

that is, short-stay outlier cases 

(§ 412.529), as discussed below in 

section II.D.4. of this preamble. 

b. Patient Classifications into DRGs 

Generally, under the LTCH PPS, 

Medicare payment is made at a 

predetermined specific rate for each 

discharge; that is, payment varies by the 

LTC–DRG to which a beneficiary’s stay 

is assigned. Similar to case classification 

for acute care hospitals under the IPPS 

(see section II.B. of this preamble), cases 

are classified into LTC–DRGs for 

payment under the LTCH PPS 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 ICD–

9–CM. 

As discussed in section II.B. of this 

preamble, the CMS DRGs are organized 

into 25 major diagnostic categories 

(MDCs), most of which are based on a 

particular organ system of the body; the 

remainder involve multiple organ 

systems (such as MDC 22, Burns). 

Accordingly, the principal diagnosis 

determines MDC assignment. Within 

most MDCs, cases are then divided into 

surgical DRGs and medical DRGs. Some 

surgical and medical DRGs are further 

differentiated based on the presence or 

absence of CCs. (See section II.B. of this 

preamble for further discussion of 

surgical DRGs and medical DRGs.) 

Because the assignment of a case to a 

particular LTC–DRG will help 

determine the amount that is paid for 

the case, it is important that the coding 

is accurate. As used under the IPPS, 

classifications and terminology used 

under the LTCH PPS are consistent with 

the ICD–9–CM and the Uniform 

Hospital Discharge Data Set (UHDDS), 

as recommended to the Secretary by the 

National Committee on Vital and Health 

Statistics (‘‘Uniform Hospital Discharge 

Data: Minimum Data Set, National 

Center for Health Statistics, April 

1980’’) and as revised in 1984 by the 

Health Information Policy Council 

(HIPC) of the U.S. Department of Health 

and Human Services. We point out 

again that the ICD–9–CM coding 

terminology and the definitions of 

principal and other diagnoses of the 

UHDDS are consistent with the 

requirements of the Transactions and 

Code Sets Standards under HIPAA (45 

CFR Parts 160 and 162). 

The emphasis on the need for proper 

coding cannot be overstated. 

Inappropriate coding of cases can 

adversely affect the uniformity of cases 

in each LTC–DRG and produce 

inappropriate weighting factors at 

recalibration and result in inappropriate 

payments under the LTCH PPS. LTCHs 

are to follow the same coding guidelines 

used by the acute care hospitals to 

ensure accuracy and consistency in 

coding practices. There will be only one 

LTC–DRG assigned per long-term care 

hospitalization; it will be assigned at the 

discharge. Therefore, it is mandatory 

that the coders continue to report the 

same principal diagnosis on all claims 

and include all diagnostic codes that 

coexist at the time of admission, that are 

subsequently developed, or that affect 

the treatment received. Similarly, all 

procedures performed during that stay 

are to be reported on each claim. 

Upon the discharge of the patient 

from a LTCH, the LTCH must assign 

appropriate diagnosis and procedure 

codes from the ICD–9–CM. Completed 

claim forms are to be submitted 

electronically to the LTCH’s Medicare 

fiscal intermediary. Medicare fiscal 

intermediaries enter the clinical and 

demographic information into their 

claims processing systems and subject 

this information to a series of automated 

screening processes called the Medicare 

Code Editor (MCE). These screens are 

designed to identify cases that require 

further review before assignment into an 

LTC–DRG can be made. 

After screening through the MCE, 

each LTCH claim will be classified into 

the appropriate LTC–DRG by the 

Medicare LTCH GROUPER. The LTCH 

GROUPER is specialized computer 

software based on the same GROUPER 

used under the IPPS. After the LTC–

DRG is assigned, the Medicare fiscal 

intermediary determines the prospective 

payment by using the Medicare LTCH 

PPS PRICER program, which accounts 

for LTCH hospital-specific adjustments. 

As provided for under the IPPS, we 

provide an opportunity for the LTCH to 

review the LTC–DRG assignments made 

by the fiscal intermediary and to submit 

additional information within a 

specified timeframe (§ 412.513(c)). 

The GROUPER is used both to classify 

past cases in order to measure relative 

hospital resource consumption to 

establish the LTC–DRG weights and to 

classify current cases for purposes of 

determining payment. The records for 

all Medicare hospital inpatient 

discharges are maintained in the 

MedPAR file. The data in this file are 

used to evaluate possible DRG 

classification changes and to recalibrate 

the DRG weights during our annual 

update (as discussed in section II. of this 

preamble). The LTC–DRG relative 

weights are based on data for the 

population of LTCH discharges, 

reflecting the fact that LTCH patients 

represent a different patient mix than 

patients in short-term acute care 

hospitals. 

3. Development of the Proposed FY 

2006 LTC–DRG Relative Weights 

a. General Overview of Development of 

the LTC–DRG Relative Weights 

As we stated in the August 30, 2002 

LTCH PPS final rule (67 FR 55981), one 

of the primary goals for the 

implementation of the LTCH PPS is to 

pay each LTCH an appropriate amount 

for the efficient delivery of care to 

Medicare patients. The system must be 

able to account adequately for each 

LTCH’s case-mix in order to ensure both 

fair distribution of Medicare payments 

and access to adequate care for those 

Medicare patients whose care is more 

costly. To accomplish these goals, we 

adjust the LTCH PPS standard Federal 

prospective payment system rate by the 

applicable LTC–DRG relative weight in 

determining payment to LTCHs for each 

case. Under the LTCH PPS, relative 

weights for each LTC–DRG are a 

primary element used to account for the 

variations in cost per discharge and 

resource utilization among the payment 

groups (§ 412.515). To ensure that 

Medicare patients classified to each 

LTC–DRG have access to an appropriate 

level of services and to encourage 

efficiency, we calculate a relative weight 

for each LTC–DRG that represents the 

resources needed by an average 

inpatient LTCH case in that LTC–DRG. 

For example, cases in an LTC–DRG with 

a relative weight of 2 will, on average, 

cost twice as much as cases in an LTC–

DRG with a weight of 1. 

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b. Data 

To calculate the proposed LTC–DRG 

relative weights for FY 2006 in this 

proposed rule, we obtained total 

Medicare allowable charges from FY 

2004 Medicare hospital bill data from 

the December 2004 update of the 

MedPAR file, and we used the proposed 

Version 23.0 of the CMS GROUPER for 

IPPS (as discussed in section II.B. of this 

preamble) to classify cases. Consistent 

with the methodology under the IPPS, 

we are proposing to recalculate the FY 

2006 LTC–DRG relative weights based 

on the best available data for this 

proposed rule. 

As we discussed in the FY 2005 IPPS 

final rule (69 FR 48984), we have 

excluded the data from LTCHs that are 

all-inclusive rate providers and LTCHs 

that are reimbursed in accordance with 

demonstration projects authorized 

under section 402(a) of Pub. L. 90–248 

(42 U.S.C. 1395b–1) or section 222(a) of 

Pub. L. 92–603 (42 U.S.C. 1395b–1). 

Therefore, in the development of the 

proposed FY 2006 LTC–DRG relative 

weights, we have excluded the data of 

the 19 all-inclusive rate providers and 

the 3 LTCHs that are paid in accordance 

with demonstration projects that had 

claims in the FY 2003 MedPAR file. 

In the FY 2005 IPPS final rule (6 FR 

48984), we discussed coding 

inaccuracies that were found in the 

claims data for a large chain of LTCHs 

in the FY 2002 MedPAR file, which 

were used to determine the LTC–DRG 

relative weights for FY 2004. As we 

discussed in the same final rule, after 

notifying the large chain of LTCHs 

whose claims contained the coding 

inaccuracies to request that they 

resubmit those claims with the correct 

diagnosis, from an analysis of LTCH 

claims data from the December 2003 

update of the FY 2003 MedPAR file, it 

appeared that such claims data no 

longer contain coding errors. Therefore, 

it was not necessary to correct the FY 

2003 MedPAR data for the development 

of the FY 2005 LTC–DRGs and relative 

weights established in the same final 

rule. 

As stated above, in this proposed rule, 

we are proposing to use the December 

2004 update of the FY 2004 MedPAR 

file for the determination of the 

proposed FY 2006 LTC–DRG relative 

weights as these are the best available 

data. Based on an analysis of LTCH 

claims data from the December 2004 

update of the FY 2004 MedPAR file, it 

appears that such claims data do not 

contain coding inaccuracies found 

previously in LTCH claims data. 

Therefore, it was not necessary to 

correct the FY 2004 MedPAR data for 

the development of the proposed FY 

2006 LTC–DRGs and relative weights 

presented in this proposed rule. 

c. Hospital-Specific Relative Value 

Methodology 

By nature, LTCHs often specialize in 

certain areas, such as ventilatordependent patients and rehabilitation 

and wound care. Some case types 

(DRGs) may be treated, to a large extent, 

in hospitals that have, from a 

perspective of charges, relatively high 

(or low) charges. This nonarbitrary 

distribution of cases with relatively high 

(or low) charges in specific LTC–DRGs 

has the potential to inappropriately 

distort the measure of average charges. 

To account for the fact that cases may 

not be randomly distributed across 

LTCHs, we use a hospital-specific 

relative value method to calculate the 

LTC–DRG relative weights instead of the 

methodology used to determine the DRG 

relative weights under the IPPS 

described above in section II.C. of this 

preamble. We believe this method will 

remove this hospital-specific source of 

bias in measuring LTCH average 

charges. Specifically, we reduce the 

impact of the variation in charges across 

providers on any particular LTC–DRG 

relative weight by converting each 

LTCH’s charge for a case to a relative 

value based on that LTCH’s average 

charge. 

Under the hospital-specific relative 

value method, we standardize charges 

for each LTCH by converting its charges 

for each case to hospital-specific relative 

charge values and then adjusting those 

values for the LTCH’s case-mix. The 

adjustment for case-mix is needed to 

rescale the hospital-specific relative 

charge values (which, by definition, 

averages 1.0 for each LTCH). The 

average relative weight for a LTCH is its 

case-mix, so it is reasonable to scale 

each LTCH’s average relative charge 

value by its case-mix. In this way, each 

LTCH’s relative charge value is adjusted 

by its case-mix to an average that 

reflects the complexity of the cases it 

treats relative to the complexity of the 

cases treated by all other LTCHs (the 

average case-mix of all LTCHs). 

In accordance with the methodology 

established under § 412.523, we 

standardize charges for each case by 

first dividing the adjusted charge for the 

case (adjusted for short-stay outliers 

under § 412.529 as described in section 

II.D.4. (step 3) of this preamble) by the 

average adjusted charge for all cases at 

the LTCH in which the case was treated. 

Short-stay outliers under § 412.529 are 

cases with a length of stay that is less 

than or equal to five-sixths the average 

length of stay of the LTC–DRG. The 

average adjusted charge reflects the 

average intensity of the health care 

services delivered by a particular LTCH 

and the average cost level of that LTCH. 

The resulting ratio is multiplied by that 

LTCH’s case-mix index to determine the 

standardized charge for the case. 

Multiplying by the LTCH’s case-mix 

index accounts for the fact that the same 

relative charges are given greater weight 

in a LTCH with higher average costs 

than they would at a LTCH with low 

average costs which is needed to adjust 

each LTCH’s relative charge value to 

reflect its case-mix relative to the 

average case-mix for all LTCHs. Because 

we standardize charges in this manner, 

we count charges for a Medicare patient 

at a LTCH with high average charges as 

less resource intensive than they would 

be at a LTCH with low average charges. 

For example, a $10,000 charge for a case 

in a LTCH with an average adjusted 

charge of $17,500 reflects a higher level 

of relative resource use than a $10,000 

charge for a case in a LTCH with the 

same case-mix, but an average adjusted 

charge of $35,000. We believe that the 

adjusted charge of an individual case 

more accurately reflects actual resource 

use for an individual LTCH because the 

variation in charges due to systematic 

differences in the markup of charges 

among LTCHs is taken into account. 

d. Proposed Low-Volume LTC–DRGs 

In order to account for LTC–DRGs 

with low-volume (that is, with fewer 

than 25 LTCH cases), in accordance 

with the methodology established in the 

August 30, 2002 LTCH PPS final rule 

(67 FR 55984), we group those lowvolume LTC–DRGs into one of five 

categories (quintiles) based on average 

charges, for the purposes of determining 

relative weights. For this proposed rule, 

using LTCH cases from the December 

2004 update of the FY 2004 MedPAR 

file, we identified 172 LTC–DRGs that 

contained between 1 and 24 cases. This 

list of proposed LTC–DRGs was then 

divided into one of the 5 low-volume 

quintiles, each containing a minimum of 

34 LTC–DRGs (172/5 = 34 with 2 LTC–

DRGs as the remainder). For FY 2006, 

we are proposing to make an assignment 

to a specific low-volume quintile by 

sorting the low-volume proposed LTC–

DRGs in ascending order by average 

charge. For this proposed rule, this 

results in an assignment to a specific 

low volume quintile of the sorted 172 

low-volume proposed LTC–DRGs by 

ascending order by average charge. 

Because the number of LTC–DRGs with 

less than 25 LTCH cases is not evenly 

divisible by five, the average charge of 

the low-volume proposed LTC–DRG 

was used to determine which lowVerDate Aug<04>2004 18:31 May 03, 2005 Jkt 205001 PO 00000 Frm 00037 Fmt 4701 Sfmt 4702 E:\FR\FM\04MYP2.SGM 04MYP2
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volume quintile received the additional 

proposed LTC–DRG. After sorting the 

172 low-volume LTC–DRGs in 

ascending order, we are proposing that 

the first fifth of low-volume LTC–DRGs 

with the lowest average charge would be 

grouped into Quintile 1. The highest 

average charge cases would be grouped 

into Quintile 5. Since the average charge 

of the proposed 35th LTC–DRG in the 

sorted list is closer to the proposed 34th 

LTC–DRG’s average charge (assigned to 

Quintile 1) than to the average charge of 

the proposed 36th LTC–DRG in the 

sorted list (to be assigned to Quintile 2), 

we are proposing to place it into 

Quintile 1. This process was repeated 

through the remaining low-volume 

proposed LTC–DRGs so that 2 proposed 

low-volume quintiles contain 35 

proposed LTC–DRGs and 3 proposed 

low-volume quintiles contain 34 

proposed LTC–DRGs. 

In order to determine the proposed 

relative weights for the proposed LTC–

DRGs with low volume for FY 2006, in 

accordance with the methodology 

established in the August 30, 2002 

LTCH PPS final rule (67 FR 55984), we 

are proposing to use the proposed five 

low-volume quintiles described above. 

The composition of each of the 

proposed five low-volume quintiles 

shown in the chart below would be used 

in determining the proposed LTC–DRG 

relative weights for FY 2006. We would 

determine a proposed relative weight 

and (geometric) average length of stay 

for each of the proposed five lowvolume quintiles using the formula that 

we apply to the regular proposed LTC–

DRGs (25 or more cases), as described 

below in section II.D.4. of this preamble. 

We are proposing to assign the same 

relative weight and average length of 

stay to each of the proposed LTC–DRGs 

that make up that proposed low-volume 

quintile. We note that, as this system is 

dynamic, it is possible that the number 

and specific type of LTC–DRGs with a 

low volume of LTCH cases will vary in 

the future. We use the best available 

claims data in the MedPAR file to 

identify low-volume LTC–DRGs and to 

calculate the relative weights based on 

our methodology. 


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4. Steps for Determining the Proposed 

FY 2006 LTC–DRG Relative Weights 

As we noted previously, the proposed 

FY 2006 LTC–DRG relative weights are 

determined in accordance with the 

methodology established in the August 

1, 2003 IPPS final rule (68 FR 45367). 

In summary, LTCH cases must be 

grouped in the appropriate LTC–DRG, 

while taking into account the lowvolume proposed LTC–DRGs as 

described above, before the proposed FY 

2006 LTC–DRG relative weights can be 

determined. After grouping the cases in 

the appropriate proposed LTC–DRG, we 

are proposing to calculate the proposed 

relative weights for FY 2006 in this 

proposed rule by first removing 

statistical outliers and cases with a 

length of stay of 7 days or less, as 

discussed in greater detail below. Next, 

we are proposing to adjust the number 

of cases in each proposed LTC–DRG for 

the effect of short-stay outlier cases 

under § 412.529, as also discussed in 

greater detail below. The short-stay 

adjusted discharges and corresponding 

charges are used to calculate ‘‘relative 

adjusted weights’’ in each proposed 

LTC–DRG using the hospital-specific 

relative value method described above. 

Below we discuss in detail the steps 

for calculating the proposed FY 2006 

LTC–DRG relative weights. 

Step 1—Remove statistical outliers. 

The first step in the calculation of the 

proposed FY 2006 LTC–DRG relative 

weights is to remove statistical outlier 

cases. We define statistical outliers as 

cases that are outside of 3.0 standard 

deviations from the mean of the log 

distribution of both charges per case and 

the charges per day for each LTC–DRG. 

These statistical outliers are removed 

prior to calculating the proposed 

relative weights. We believe that they 

may represent aberrations in the data 

that distort the measure of average 

resource use. Including those LTCH 

cases in the calculation of the proposed 

relative weights could result in an 

inaccurate proposed relative weight that 

does not truly reflect relative resource 

use among the proposed LTC–DRGs. 

Step 2—Remove cases with a length 

of stay of 7 days or less. 

The proposed FY 2006 LTC–DRG 

relative weights reflect the average of 

resources used on representative cases 

of a specific type. Generally, cases with 

a length of stay 7 days or less do not 

belong in a LTCH because these stays do 

not fully receive or benefit from 

treatment that is typical in a LTCH stay, 

and full resources are often not used in 

the earlier stages of admission to a 

LTCH. If we were to include stays of 7 

days or less in the computation of the 

proposed FY 2006 LTC–DRG relative 

weights, the value of many proposed 

relative weights would decrease and, 

therefore, payments would decrease to a 

level that may no longer be appropriate. 

We do not believe that it would be 

appropriate to compromise the integrity 

of the payment determination for those 

LTCH cases that actually benefit from 

and receive a full course of treatment at 

a LTCH, in order to include data from 

these very short-stays. Thus, in 

determining the proposed FY 2006 

LTC–DRG relative weights, we remove 

LTCH cases with a length of stay of 7 

days or less. 

Step 3—Adjust charges for the effects 

of short-stay outliers. 

After removing cases with a length of 

stay of 7 days or less, we are left with 

cases that have a length of stay of greater 

than or equal to 8 days. The next step 

in the calculation of the proposed FY 

2006 LTC–DRG relative weights is to 

adjust each LTCH’s charges per 

discharge for those remaining cases for 

the effects of short-stay outliers as 

defined in § 412.529(a). (However, we 

note that even if a case was removed in 

Step 2 (that is, cases with a length of 

stay of 7 days or less), it was paid as a 

short-stay outlier if its length of stay was 

less than or equal to five-sixths of the 

average length of stay of the LTC–DRG, 

in accordance with § 412.529.) 

We make this adjustment by counting 

a short-stay outlier as a fraction of a 

discharge based on the ratio of the 

length of stay of the case to the average 

length of stay for the proposed LTC–

DRG for nonshort-stay outlier cases. 

This has the effect of proportionately 

reducing the impact of the lower 

charges for the short-stay outlier cases 

in calculating the average charge for the 

proposed LTC–DRG. This process 

produces the same result as if the actual 

charges per discharge of a short-stay 

outlier case were adjusted to what they 

would have been had the patient’s 

length of stay been equal to the average 

length of stay of the proposed LTC–

DRG. 

As we explained in the FY 2005 IPPS 

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stay outlier cases as full discharges with 

no adjustment in determining the 

proposed LTC–DRG relative weights 

would lower the proposed LTC–DRG 

relative weight for affected proposed 

LTC–DRGs because the relatively lower 

charges of the short-stay outlier cases 

would bring down the average charge 

for all cases within a proposed LTC–

DRG. This would result in an 

‘‘underpayment’’ to nonshort-stay 

outlier cases and an ‘‘overpayment’’ to 

short-stay outlier cases. Therefore, in 

this proposed rule, we adjust for shortstay outlier cases under § 412.529 in this 

manner because it results in more 

appropriate payments for all LTCH 

cases. 

Step 4—Calculate the Proposed FY 

2006 LTC–DRG relative weights on an 

iterative basis. 

The process of calculating the 

proposed LTC–DRG relative weights 

using the hospital specific relative value 

methodology is iterative. First, for each 

LTCH case, we calculate a hospitalspecific relative charge value by 

dividing the short-stay outlier adjusted 

charge per discharge (see step 3) of the 

LTCH case (after removing the statistical 

outliers (see step 1)) and LTCH cases 

with a length of stay of 7 days or less 

(see step 2) by the average charge per 

discharge for the LTCH in which the 

case occurred. The resulting ratio is 

then multiplied by the LTCH’s case-mix 

index to produce an adjusted hospitalspecific relative charge value for the 

case. An initial case-mix index value of 

1.0 is used for each LTCH. 

For each proposed LTC–DRG, the 

proposed FY 2006 LTC–DRG relative 

weight is calculated by dividing the 

average of the adjusted hospital-specific 

relative charge values (from above) for 

the proposed LTC–DRG by the overall 

average hospital-specific relative charge 

value across all cases for all LTCHs. 

Using these recalculated proposed LTC–

DRG relative weights, each proposed 

LTCH’s average relative weight for all of 

its cases (case-mix) is calculated by 

dividing the sum of all the proposed 

LTCH’s LTC–DRG relative weights by its 

total number of cases. The LTCHs’

hospital-specific relative charge values 

above are multiplied by these hospital 

specific case-mix indexes. These 

hospital-specific case-mix adjusted 

relative charge values are then used to 

calculate a new set of proposed LTC–

DRG relative weights across all LTCHs. 

In this proposed rule, this iterative 

process is continued until there is 

convergence between the weights 

produced at adjacent steps, for example, 

when the maximum difference is less 

than 0.0001. 

Step 5–Adjust the proposed FY 2006 

LTC–DRG relative weights to account 

for nonmonotonically increasing 

relative weights. 

As explained in section II.B. of this 

preamble, the proposed FY 2006 CMS 

DRGs, which the proposed FY 2006 

LTC–DRGs are based, contain ‘‘pairs’’

that are differentiated based on the 

presence or absence of CCs. The 

proposed LTC–DRGs with CCs are 

defined by certain secondary diagnoses 

not related to or inherently a part of the 

disease process identified by the 

principal diagnosis, but the presence of 

additional diagnoses does not 

automatically generate a CC. As we 

discussed in the FY 2005 IPPS final rule 

(69 FR 48991), the value of 

monotonically increasing relative 

weights rises as the resource use 

increases (for example, from 

uncomplicated to more complicated). 

The presence of CCs in a proposed LTC–

DRG means that cases classified into a 

‘‘without CC’’ proposed LTC–DRG are 

expected to have lower resource use 

(and lower costs). In other words, 

resource use (and costs) are expected to 

decrease across ‘‘with CC’’/‘‘without CC’’

pairs of proposed LTC–DRGs. 

For a case to be assigned to a 

proposed LTC–DRG with CCs, more 

coded information is called for (that is, 

at least one relevant secondary 

diagnosis), than for a case to be assigned 

to a proposed LTC–DRG ‘‘without CCs’’

(which is based on only one principal 

diagnosis and no relevant secondary 

diagnoses). Currently, the LTCH claims 

data include both accurately coded 

cases without complications and cases 

that have complications (and cost more), 

but were not coded completely. Both 

types of cases are grouped to a proposed 

LTC–DRG ‘‘without CCs’’ because only 

one principal diagnosis was coded. 

Since the LTCH PPS was only 

implemented for cost reporting periods 

beginning on or after October 1, 2002 

(FY 2003) and LTCHs were previously 

paid under cost-based reimbursement, 

which is not based on patient diagnoses, 

coding by LTCHs for these cases may 

not have been as detailed as possible. 

Thus, in developing the FY 2003 

LTC–DRG relative weights for the LTCH 

PPS based on FY 2001 claims data, as 

we discussed in the August 30, 2002 

LTCH PPS final rule (67 FR 55990), we 

found on occasion that the data 

suggested that cases classified to the 

LTC–DRG ‘‘with CCs’’ of a ‘‘with CC’’/ 

‘‘without CC’’ pair had a lower average 

charge than the corresponding LTC–

DRG ‘‘without CCs.’’ Similarly, as 

discussed in the FY 2005 IPPS final rule 

(69 FR 48991 through 48992), based on 

FY 2003 claims data, we also found on 

occasion that the data suggested that 

cases classified to the LTC–DRG ‘‘with 

CCs’’ of a ‘‘with CC’’/‘‘without CC’’ pair 

have a lower average charge than the 

corresponding LTC–DRG ‘‘without CCs’’

for the FY 2005 LTC–DRG relative 

weights. 

We believe this anomaly may be due 

to coding that may not have fully 

reflected all comorbidities that were 

present. Specifically, LTCHs may have 

failed to code relevant secondary 

diagnoses, which resulted in cases that 

actually had CCs being classified into a 

‘‘without CC’’ LTC–DRG. It would not be 

appropriate to pay a lower amount for 

the ‘‘with CC’’ LTC–DRG because, in 

general, cases classified into a ‘‘with 

CC’’ LTC–DRG are expected to have 

higher resource use (and higher cost) as 

discussed above. Therefore, previously 

when we determined the LTC–DRG 

relative weights in accordance with the 

methodology established in the August 

30, 2002 LTCH PPS final rule (67 FR 

55990), we grouped both the cases ‘‘with 

CCs’’ and ‘‘without CCs’’ together for the 

purpose of calculating the LTC–DRG 

relative weights for FYs 2003 through 

2005. As we stated in that same final 

rule, we will continue to employ this 

methodology to account for 

nonmonotonically increasing relative 

weights until we have adequate data to 

calculate appropriate separate weights 

for these anomalous LTC–DRG pairs. 

We expect that, as was the case when 

we first implemented the IPPS, this 

problem will be self-correcting, as 

LTCHs submit more completely coded 

data in the future. 

There are three types of ‘‘with CC’’

and ‘‘without CC’’ pairs that could be 

nonmonotonic; that is, where the 

‘‘without CC’’ proposed LTC–DRG 

would have a higher average charge 

than the ‘‘with CC’’ proposed LTC–DRG. 

For this proposed rule, using the LTCH 

cases in the December 2004 update of 

the FY 2004 MedPAR file (the best 

available data at this time), we 

identified one of the three types of 

nonmonotonic LTC–DRG pairs. 

The first category of 

nonmonotonically increasing proposed 

relative weights for FY 2006 proposed 

LTC–DRG pairs ‘‘with and without CCs’’

contains zero pairs of proposed LTC–

DRGs in which both the proposed LTC–

DRG ‘‘with CCs’’ and the proposed LTC–

DRG ‘‘without CCs’’ had 25 or more 

LTCH cases and, therefore, did not fall 

into one of the 5 low-volume quintiles. 

For those nonmonotonic proposed LTC–

DRG pairs, we would combine the 

LTCH cases and compute a new 

proposed relative weight based on the 

case-weighted average of the combined 

LTCH cases of the proposed LTC–DRGs. 

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The case-weighted average charge is 

determined by dividing the total charges 

for all LTCH cases by the total number 

of LTCH cases for the combined 

proposed LTC–DRG. This new proposed 

relative weight would then be assigned 

to both of the proposed LTC–DRGs in 

the pair. In this proposed rule, for FY 

2006, there are no proposed LTC–DRGs 

that fall into this category. 

The second category of 

nonmonotonically increasing relative 

weights for proposed LTC–DRG pairs 

‘‘with and without CCs’’ consists of one 

pair of proposed LTC–DRGs that has 

fewer than 25 cases, and each proposed 

LTC–DRG would be grouped to different 

proposed low-volume quintiles in 

which the ‘‘without CC’’ proposed LTC–

DRG is in a higher-weighted proposed 

low-volume quintile than the ‘‘with CC’’

proposed LTC–DRG. For those pairs, we 

would combine the LTCH cases and 

determine the case-weighted average 

charge for all LTCH cases. The caseweighted average charge is determined 

by dividing the total charges for all 

LTCH cases by the total number of 

LTCH cases for the combined proposed 

LTC–DRG. Based on the case-weighted 

average LTCH charge, we determine 

within which low-volume quintile the 

‘‘combined LTC–DRG’’ is grouped. Both 

proposed LTC–DRGs in the pair are then 

grouped into the same proposed lowvolume quintile, and thus have the same 

proposed relative weight. In this 

proposed rule, for FY 2006, proposed 

LTC–DRGs 531 and 532 fall into this 

category. 

The third category of 

nonmonotonically increasing relative 

weights for proposed LTC–DRG pairs 

‘‘with and without CCs’’ consists of zero 

pairs of proposed LTC–DRGs where one 

of the proposed LTC–DRGs has fewer 

than 25 LTCH cases and is grouped to 

a proposed low-volume quintile and the 

other proposed LTC–DRG has 25 or 

more LTCH cases and has its own 

proposed LTC–DRG relative weight, and 

the proposed LTC–DRG ‘‘without CCs’’

has the higher proposed relative weight. 

We remove the proposed low-volume 

LTC–DRG from the proposed lowvolume quintile and combine it with the 

other proposed LTC–DRG for the 

computation of a new proposed relative 

weight for each of these proposed LTC–

DRGs. This new proposed relative 

weight is assigned to both proposed 

LTC–DRGs, so they each have the same 

proposed relative weight. In this 

proposed rule, for FY 2006, there are no 

proposed LTC–DRGs that fall into this 

category. 

Step 6–Determine a proposed FY 2006 

LTC–DRG relative weight for proposed 

LTC–DRGs with no LTCH cases. 

As we stated above, we determine the 

proposed relative weight for each 

proposed LTC–DRG using charges 

reported in the December 2004 update 

of the FY 2004 MedPAR file. Of the 526 

proposed LTC–DRGs for FY 2006, we 

identified 194 proposed LTC–DRGs for 

which there were no LTCH cases in the 

database. That is, based on data from the 

FY 2004 MedPAR file used in this 

proposed rule, no patients who would 

have been classified to those LTC–DRGs 

were treated in LTCHs during FY 2004 

and, therefore, no charge data were 

reported for those proposed LTC–DRGs. 

Thus, in the process of determining the 

proposed LTC–DRG relative weights, we 

are unable to determine weights for 

these 194 proposed LTC–DRGs using 

the methodology described in steps 1 

through 5 above. However, because 

patients with a number of the diagnoses 

under these proposed LTC–DRGs may 

be treated at LTCHs beginning in FY 

2006, we assign proposed relative 

weights to each of the 194 ‘‘no volume’’

proposed LTC–DRGs based on clinical 

similarity and relative costliness to one 

of the remaining 332 (156—194 = 332) 

proposed LTC–DRGs for which we are 

able to determine proposed relative 

weights, based on FY 2004 claims data. 

As there are currently no LTCH cases 

in these ‘‘no volume’’ proposed LTC–

DRGs, we determine proposed relative 

weights for the 194 proposed LTC–DRGs 

with no LTCH cases in the FY 2004 

MedPAR file used in this proposed rule 

by grouping them to the appropriate 

proposed low-volume quintile. This 

methodology is consistent with our 

methodology used in determining 

proposed relative weights to account for 

the proposed low-volume LTC–DRGs 

described above. 

Our methodology for determining 

proposed relative weights for the 

proposed ‘‘no volume’’ LTC–DRGs is as 

follows: We crosswalk the proposed no 

volume LTC–DRGs by matching them to 

other similar proposed LTC–DRGs for 

which there were LTCH cases in the FY 

2004 MedPAR file based on clinical 

similarity and intensity of use of 

resources as determined by care 

provided during the period of time 

surrounding surgery, surgical approach 

(if applicable), length of time of surgical 

procedure, post-operative care, and 

length of stay. We assign the proposed 

relative weight for the applicable 

proposed low-volume quintile to the 

proposed no volume LTC–DRG if the 

proposed LTC–DRG to which it is 

crosswalked is grouped to one of the 

proposed low-volume quintiles. If the 

proposed LTC–DRG to which the 

proposed no volume LTC–DRG is 

crosswalked is not one of the proposed 

LTC–DRGs to be grouped to one of the 

proposed low-volume quintiles, we 

compare the proposed relative weight of 

the proposed LTC–DRG to which the 

proposed no volume LTC–DRG is 

crosswalked to the proposed relative 

weights of each of the five quintiles and 

we assign the proposed no volume LTC–

DRG the proposed relative weight of the 

proposed low-volume quintile with the 

closest weight. For this proposed rule, a 

list of the proposed no volume FY 2006 

LTC–DRGs and the proposed FY 2006 

LTC–DRG to which it is crosswalked in 

order to determine the appropriate 

proposed low-volume quintile for the 

assignment of a relative weight for FY 

2006 is shown in the chart below. 

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To illustrate this methodology for 

determining the proposed relative 

weights for the 194 proposed LTC–DRGs 

with no LTCH cases, we are providing 

the following examples, which refer to 

the proposed no volume LTC–DRGs 

crosswalk information for FY 2006 

provided in the chart above. 

Example 1: 

There were no cases in the FY 2004 

MedPAR file used for this proposed rule 

for proposed LTC–DRG 163 (Hernia 

Procedures Age 0–17). Since the 

procedure is similar in resource use and 

the length and complexity of the 

procedures and the length of stay are 

similar, we determined that proposed 

LTC–DRG 178 (Uncomplicated Peptic 

Ulcer Without CC), which is assigned to 

proposed low-volume Quintile 3 for the 

purpose of determining the proposed FY 

2006 relative weights, would display 

similar clinical and resource use. 

Therefore, we assign the same proposed 

relative weight of proposed LTC–DRG 

178 of 0.7586 (proposed Quintile 3) for 

FY 2006 (Table 11 in the Addendum to 

this proposed rule) to proposed LTC–

DRG 163. 

Example 2: 

There were no LTCH cases in the FY 

2004 MedPAR file used in this proposed 

rule for proposed LTC–DRG 91 (Simple 

Pneumonia and Pleurisy Age 0–17). 

Since the severity of illness in patients 

with bronchitis and asthma is similar in 

patients regardless of age, we 

determined that proposed LTC–DRG 90 

(Simple Pneumonia and Pleurisy Age 

>17 Without CC) would display similar 

clinical and resource use characteristics 

and have a similar length of stay to 

proposed LTC–DRG 91. There were over 

25 cases in proposed LTC–DRG 90. 

Therefore, it would not be assigned to 

a low-volume quintile for the purpose of 

determining the proposed LTC–DRG 

relative weights. However, under our 

established methodology, proposed 

LTC–DRG 91, with no LTCH cases, 

would need to be grouped to a proposed 

low-volume quintile. We determined 

that the proposed low-volume quintile 

with the closest weight to proposed 

LTC–DRG 90 (0.5004) (refer to Table 11 

in the Addendum to this proposed rule) 

would be proposed low-volume 

Quintile 1 (0. 4502) (refer to Table 11 in 

the Addendum to this proposed rule). 

Therefore, we assign proposed LTC–

DRG 91 a proposed relative weight of 

0.4502 for FY 2006. 

Furthermore, we are proposing LTC–

DRG relative weights of 0.0000 for heart, 

kidney, liver, lung, pancreas, and 

simultaneous pancreas/kidney 

transplants (LTC–DRGs 103, 302, 480, 

495, 512, and 513, respectively) for FY 

2006 because Medicare will only cover 

these procedures if they are performed 

at a hospital that has been certified for 

the specific procedures by Medicare and 

presently no LTCH has been so certified. 

Based on our research, we found that 

most LTCHs only perform minor 

surgeries, such as minor small and large 

bowel procedures, to the extent any 

surgeries are performed at all. Given the 

extensive criteria that must be met to 

become certified as a transplant center 

for Medicare, we believe it is unlikely 

that any LTCHs would become certified 

as a transplant center. In fact, in the 

nearly 20 years since the 

implementation of the IPPS, there has 

never been a LTCH that even expressed 

an interest in becoming a transplant 

center. 

However, if in the future a LTCH 

applies for certification as a Medicareapproved transplant center, we believe 

that the application and approval 

procedure would allow sufficient time 

for us to determine appropriate weights 

for the LTC–DRGs affected. At the 

present time, we would only include 

these six transplant LTC–DRGs in the 

GROUPER program for administrative 

purposes. Because we use the same 

GROUPER program for LTCHs as is used 

under the IPPS, removing these LTC–

DRGs would be administratively 

burdensome. 

Again, we note that as this system is 

dynamic, it is entirely possible that the 

number of proposed LTC–DRGs with a 

zero volume of LTCH cases based on the 

system will vary in the future. We used 

the best most recent available claims 

data in the MedPAR file to identify zero 

volume LTC–DRGs and to determine the 

proposed relative weights in this 

proposed rule. 

Table 11 in the Addendum to this 

proposed rule lists the proposed LTC–

DRGs and their respective proposed 

relative weights, geometric mean length 

of stay, and five-sixths of the geometric 

mean length of stay (to assist in the 

determination of short-stay outlier 

payments under § 412.529) for FY 2006. 

E. Proposed Add-On Payments for New 

Services and Technologies 

(If you choose to comment on issues 

in this section, please include the 

caption ‘‘New Technology Applications’’

at the beginning of your comment.) 


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1. Background 

Sections 1886(d)(5)(K) and (L) of the 

Act establish a process of identifying 

and ensuring adequate payment for new 

medical services and technologies under 

the IPPS. Section 1886(d)(5)(K)(vi) of 

the Act specifies that a medical service 

or technology will be considered new if 

it meets criteria established by the 

Secretary after notice and opportunity 

for public comment. Section 

1886(d)(5)(K)(ii)(I) of the Act specifies 

that the process must apply to a new 

medical service or technology if, ‘‘based 

on the estimated costs incurred with 

respect to discharges involving such 

service or technology, the DRG 

prospective payment rate otherwise 

applicable to such discharges under this 

subsection is inadequate.’’

The regulations implementing this 

provision establish three criteria for new 

medical services and techniques to 

receive an additional payment. First, 

§ 412.87(b)(2) defines when a specific 

medical service or technology will be 

considered new for purposes of new 

medical service or technology add-on 

payments. The statutory provision 

contemplated the special payment 

treatment for new medical services or 

technologies until such time as data are 

available to reflect the cost of the 

technology in the DRG weights through 

recalibration. There is a lag of 2 to 3 

years from the point a new medical 

service or technology is first introduced 

on the market and when data reflecting 

the use of the medical service or 

technology are used to calculate the 

DRG weights. For example, data from 

discharges occurring during FY 2004 are 

used to calculate the proposed FY 2006 

DRG weights in this proposed rule. 

Section 412.87(b)(2) provides that a 

‘‘medical service or technology may be 

considered new within 2 or 3 years after 

the point at which data begin to become 

available reflecting the ICD–9–CM code 

assigned to the new medical service or 

technology (depending on when a new 

code is assigned and data on the new 

medical service or technology become 

available for DRG recalibration). After 

CMS has recalibrated the DRGs, based 

on available data, to reflect the costs of 

an otherwise new medical service or 

technology, the medical service or 

technology will no longer be considered 

‘new’ under the criterion for this 

section.’’

The 2-year to 3-year period during 

which a technology or medical service 

can be considered new would ordinarily 

begin with FDA approval, unless there 

was some documented delay in bringing 

the product onto the market after that 

approval (for instance, component 

production or drug production had been 

postponed until FDA approval due to 

shelf life concerns or manufacturing 

issues). After the DRGs have been 

recalibrated to reflect the costs of an 

otherwise new medical service or 

technology, the special add-on payment 

for new medical services or technology 

ceases (§ 412.87(b)(2)). For example, an 

approved new technology that received 

FDA approval in October 2004 and 

entered the market at that time may be 

eligible to receive add-on payments as a 

new technology until FY 2007 

(discharges occurring before October 1, 

2006), when data reflecting the costs of 

the technology would be used to 

recalibrate the DRG weights. Because 

the FY 2007 DRG weights will be 

calculated using FY 2005 MedPAR data, 

the costs of such a new technology 

would likely be reflected in the FY 2007 

DRG weights. 

Section 412.87(b)(3) further provides 

that, to receive special payment 

treatment, new medical services or 

technologies must be inadequately paid 

otherwise under the DRG system. To 

assess whether technologies would be 

inadequately paid under the DRGs, we 

establish thresholds to evaluate 

applicants for new technology add-on 

payments. In the FY 2004 IPPS final 

rule (68 FR 45385), we established the 

threshold at the geometric mean 

standardized charge for all cases in the 

DRG plus 75 percent of 1 standard 

deviation above the geometric mean 

standardized charge (based on the 

logarithmic values of the charges and 

transformed back to charges) for all 

cases in the DRG to which the new 

medical service or technology is 

assigned (or the case-weighted average 

of all relevant DRGs, if the new medical 

service or technology occurs in many 

different DRGs). Table 10 in the 

Addendum to the FY 2004 IPPS final 

rule (68 FR 45648) listed the qualifying 

threshold by DRG, based on the 

discharge data that we used to calculate 

the FY 2004 DRG weights. 

However, section 503(b)(1) of Pub. L. 

108–173 amended section 

1886(d)(5)(K)(ii)(I) of the Act to provide 

for ‘‘applying a threshold* * *that is 

the lesser of 75 percent of the 

standardized amount (increased to 

reflect the difference between cost and 

charges) or 75 percent of 1 standard 

deviation for the diagnosis-related group 

involved.’’ The provisions of section 

503(b)(1) apply to classification for 

fiscal years beginning with FY 2005. We 

updated Table 10 from the October 6, 

2003 Federal Register correction 

document, which contains the 

thresholds that we used to evaluate 

applications for new service or 

technology add-on payments for FY 

2005, using the section 503(b)(1) 

measures stated above, and posted these 

new thresholds on our Web site at: 

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

hipps/newtech.asp. In the FY 2005 IPPS 

final rule (in Table 10 of the 

Addendum), we included the final 

thresholds that are being used to 

evaluate applicants for new technology 

add-on payments for FY 2006. (Refer to 

section IV.D. of the preamble to the FY 

2005 IPPS final rule (69 FR 49084) for 

a discussion of a revision of the 

regulations to incorporate the change 

made by section 503(b)(1) of Pub. L. 

108–173.) 

Section 412.87(b)(1) of our existing 

regulations provides that a new 

technology is an appropriate candidate 

for an additional payment when it 

represents an advance in medical 

technology that substantially improves, 

relative to technologies previously 

available, the diagnosis or treatment of 

Medicare beneficiaries. For example, a 

new technology represents a substantial 

clinical improvement when it reduces 

mortality, decreases the number of 

hospitalizations or physician visits or 

reduces recovery time compared to the 

technologies previously available. (See 

the September 7, 2001 final rule (66 FR 

46902) for a complete discussion of this 

criterion.) 

The new medical service or 

technology add-on payment policy 

provides additional payments for cases 

with high costs involving eligible new 

medical services or technologies while 

preserving some of the incentives under 

the average-based payment system. The 

payment mechanism is based on the 

cost to hospitals for the new medical 

service or technology. Under § 412.88, 

Medicare pays a marginal cost factor of 

50 percent for the costs of a new 

medical service or technology in excess 

of the full DRG payment. If the actual 

costs of a new medical service or 

technology case exceed the DRG 

payment by more than the 50-percent 

marginal cost factor of the new medical 

service or technology, Medicare 

payment is limited to the DRG payment 

plus 50 percent of the estimated costs of 

the new technology. 

The report language accompanying 

section 533 of Pub. L. 106–554 indicated 

Congressional intent that the Secretary 

implement the new mechanism on a 

budget neutral basis (H.R. Conf. Rep. 

No. 106–1033, 106th Cong., 2nd Sess. at 

897 (2000)). Section 1886(d)(4)(C)(iii) of 

the Act requires that the adjustments to 

annual DRG classifications and relative 

weights must be made in a manner that 

ensures that aggregate payments to 

hospitals are not affected. Therefore, in 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23355 

the past, we accounted for projected 

payments under the new medical 

service and technology provision during 

the upcoming fiscal year at the same 

time we estimated the payment effect of 

changes to the DRG classifications and 

recalibration. The impact of additional 

payments under this provision was then 

included in the budget neutrality factor, 

which was applied to the standardized 

amounts and the hospital-specific 

amounts. 

Section 503(d)(2) of Pub. L. 108–173 

amended section 1886(d)(5)(K)(ii)(III) of 

the Act to provide that there shall be no 

reduction or adjustment in aggregate 

payments under the IPPS due to add-on 

payments for new medical services and 

technologies. Therefore, add-on 

payments for new medical services or 

technologies for FY 2005 and later years 

will not be budget neutral. 

Applicants for add-on payments for 

new medical services or technologies for 

FY 2007 must submit a formal request, 

including a full description of the 

clinical applications of the medical 

service or technology and the results of 

any clinical evaluations demonstrating 

that the new medical service or 

technology represents a substantial 

clinical improvement, along with a 

significant sample of data to 

demonstrate the medical service or 

technology meets the high-cost 

threshold, no later than October 15, 

2005. Applicants must submit a 

complete database no later than 

December 30, 2005. Complete 

application information, along with 

final deadlines for submitting a full 

application, will be available after 

publication of the FY 2006 final rule at 

our Web site: http://www.cms.hhs.gov/ 

providers/hipps/default.asp. To allow 

interested parties to identify the new 

medical services or technologies under 

review before the publication of the 

proposed rule for FY 2007, the website 

will also list the tracking forms 

completed by each applicant. 

2. Public Input Before Publication of 

This Notice of Proposed Rulemaking on 

Add-On Payments 

Section 503(b)(2) of Pub. L. 108–173 

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

Act by adding a clause (viii) to provide 

for a mechanism for public input before 

publication of a notice of proposed 

rulemaking regarding whether a medical 

service or technology represents a 

substantial improvement or 

advancement. The revised process for 

evaluating new medical service and 

technology applications requires the 

Secretary to—

• Provide, before publication of a 

proposed rule, for public input 

regarding whether a new service or 

technology represents an advance in 

medical technology that substantially 

improves the diagnosis or treatment of 

Medicare beneficiaries. 

• Make public and periodically 

update a list of the services and 

technologies for which an application 

for add-on payments is pending. 

• Accept comments, 

recommendations, and data from the 

public regarding whether a service or 

technology represents a substantial 

improvement. 

• Provide, before publication of a 

proposed rule, for a meeting at which 

organizations representing hospitals, 

physicians, manufacturers, and any 

other interested party may present 

comments, recommendations, and data 

regarding whether a new service or 

technology represents a substantial 

clinical improvement to the clinical 

staff of CMS. 

In order to provide an opportunity for 

public input regarding add-on payments 

for new medical services and 

technologies for FY 2006 before 

publication of this proposed rule, we 

published a notice in the Federal 

Register on December 30, 2004 (69 FR 

78466) and held a town hall meeting at 

the CMS Headquarters Office in 

Baltimore, MD, on February 23, 2005. In 

the announcement notice for the 

meeting, we stated that the opinions and 

alternatives provided during the 

meeting would assist us in our 

evaluations of applications by allowing 

public discussions of the substantial 

clinical improvement criteria for each of 

the FY 2006 new medical service and 

technology add-on payment 

applications before the publication of 

this FY 2006 IPPS proposed rule. 

Approximately 45 participants 

registered and attended in person, while 

additional participants listened over an 

open telephone line. The participants 

focused on presenting data on the 

substantial clinical improvement aspect 

of their products, as well as the need for 

additional payments to ensure access to 

Medicare beneficiaries. In addition, we 

received written comments regarding 

the substantial clinical improvement 

criterion for the applicants. We have 

considered these comments in our 

evaluation of each new application for 

FY 2006 in this proposed rule. We have 

summarized these comments or, if 

applicable, indicated that no comments 

were received, at the end of the 

discussion of the individual 

applications. 

Section 503(c) of Pub. L. 108–173 

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

Act by adding a new clause (ix) 

requiring that, before establishing any 

add-on payment for a new medical 

service or technology, the Secretary 

shall seek to identify one or more DRGs 

associated with the new technology, 

based on similar clinical or anatomical 

characteristics and the costs of the 

technology and assign the new 

technology into a DRG where the 

average costs of care most closely 

approximate the costs of care using the 

new technology. No add-on payment 

shall be made with respect to such a 

new technology. 

At the time an application for new 

technology add-on payments is 

submitted, the DRGs associated with the 

new technology are identified. We only 

determine that a new technology add-on 

payment is appropriate when the 

reimbursement under these DRGs is not 

adequate for this new technology. The 

criterion for this determination is the 

cost threshold, which we discuss below. 

We discuss the assignments of several 

new technologies within the DRG 

payment system in section II.B. of this 

proposed rule. 

In this proposed rule, we evaluate 

whether new technology add-on 

payments will continue in FY 2006 for 

the three technologies that currently 

receive such payments. In addition, we 

present our evaluations of eight 

applications for add-on payments in FY 

2006. The eight applications for FY 

2006 include two applications for 

products that were denied new 

technology add-on payments for FY 

2005. 

3. FY 2006 Status of Technology 

Approved for FY 2005 Add-On 

Payments 

a. INFUSE TM (Bone Morphogenetic 

Proteins (BMPs) for Spinal Fusions) 

INFUSE TM was approved by FDA for 

use on July 2, 2002, and became 

available on the market immediately 

thereafter. In the FY 2004 IPPS final rule 

(68 FR 45388), we approved INFUSE TM

for add-on payments under § 412.88, 

effective for FY 2004. This approval was 

on the basis of using INFUSE TM for 

single-level, lumbar spinal fusion, 

consistent with the FDA’s approval and 

the data presented to us by the 

applicant. Therefore, we limited the 

add-on payment to cases using this 

technology for anterior lumbar fusions 

in DRGs 497 (Spinal Fusion Except 

Cervical With CC) and 498 (Spinal 

Fusion Except Cervical Without CC). 

Cases involving INFUSE TM that are 

eligible for the new technology add-on 

payment are identified by assignment to 

DRGs 497 and 498 as a lumbar spinal 

fusion, with the combination of ICD–9–

CM procedure codes 84.51 (Insertion of 

23356 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

interbody spinal fusion device) and 

84.52 (Insertion of recombinant bone 

morphogenetic protein). 

The FDA approved INFUSE TM for use 

on July 2, 2002. For FY 2005, 

INFUSE TM was still within the 2-year to 

3-year period during which a 

technology can be considered new 

under the regulations. Therefore, in the 

FY 2005 IPPS final rule (69 FR 49007 

through 49009), we continued add-on 

payments for FY 2005 for cases 

receiving INFUSE TM for spinal fusions 

in DRGs 497 (Spinal Fusion Except 

Cervical With CC) and 498 (Spinal 

Fusion Except Cervical Without CC). 

As we discussed in the September 7, 

2001 final rule (66 FR 46915), an 

approval of a new technology for special 

payment should extend to all 

technologies that are substantially 

similar. Otherwise, our payment policy 

would bestow an advantage to the first 

applicant to receive approval for a 

particular new technology. In last year’s 

final rule (69 FR 49008), we discussed 

another product, called OP–1 Putty, 

manufactured by Stryker Biotech, that 

promotes natural bone growth by using 

a closely related bone morphogenetic 

protein called rhBMP–7. (INFUSE TM is 

rhBMP–2.) We also stated in last year’s 

final rule that we had determined that 

the costs associated with the OP–1 Putty 

are similar to those associated with 

INFUSE TM. Because the OP–1 Putty 

became available on the market in May 

2004 (when it received FDA approval 

for spinal fusions) for similar spinal 

fusion procedures and because this 

product also eliminates the need for the 

autograft bone surgery, we extended 

new technology add-on payments to this 

technology as well for FY 2005. 

As noted above, the period for which 

technologies are eligible to receive new 

technology add-on payments is 2 to 3 

years after the product becomes 

available on the market and data 

reflecting the cost of the technology are 

reflected in the DRG weights. The FDA 

approved INFUSE TM bone graft on July 

2, 2002. Therefore, data reflecting the 

cost of the technology are now reflected 

in the DRG weights. In addition, by the 

end of FY 2005, the add-on payment 

will have been made for 2 years. 

Therefore, we are proposing to 

discontinue new technology add-on 

payment for INFUSE TM for FY 2006. 

Because we apply the same policies in 

making new technology payment for 

OP–1 Putty as we do for INFUSE TM, we 

are proposing to discontinue new 

technology add-on payment for OP–1 

Putty as well for FY 2006. 

b. InSync Defibrillator System (Cardiac 

Resynchronization Therapy With 

Defibrillation (CRT–D)) 

Cardiac Resynchronization Therapy 

(CRT), also known as bi-ventricular 

pacing, is a therapy for chronic heart 

failure. A CRT implantable system 

provides electrical stimulation to the 

right atrium, right ventricle, and left 

ventricle to coordinate or resynchronize 

ventricular contractions and improve 

cardiac output. 

In the FY 2005 IPPS final rule (69 FR 

49016), we determined that cardiac 

resynchronization therapy with 

defibrillator (CRT–D) was eligible for 

add-on payments in FY 2005. Cases 

involving CRT–D that are eligible for 

new technology add-on payments are 

identified by either one of the following 

two ICD–9–CM procedure codes: 00.51 

(Implantation of Cardiac 

Resynchronization Defibrillator, Total 

System (CRT–D)) or 00.54 (Implantation 

or Replacement of Pulse Generator 

Device Only (CRT–D)). InSync

Defibrillation System received FDA 

approval on June 26, 2002. However, 

another manufacturer, Guidant, received 

FDA approval for its CRT–D device on 

May 2, 2002. As we discussed in the 

September 7, 2001 final rule (66 FR 

46915), an approval of a new technology 

for special payment should extend to all 

technologies that are substantially 

similar. Otherwise, our payment policy 

would bestow an advantage to the first 

applicant to receive approval for a 

particular new technology. We also 

noted that we would extend new 

technology add-on payments for the 

entire FY 2005 even though the 2–3 year 

period of newness ended in May 2005 

for CRT–D since predictability is an 

important aspect of the prospective 

payment methodology and, therefore, 

we believe it is appropriate to apply a 

consistent payment methodology for 

new technologies throughout the fiscal 

year (69 FR 49016). 

As noted in the FY 2005 IPPS final 

rule (69 FR 49014), because CRT–Ds 

were available upon the initial FDA 

approval in May 2002, we considered 

the technology to be new from this date. 

As a result, for FY 2006, the CRT–D will 

be beyond the 2–3 year period during 

which a technology can be considered 

new. Therefore, we are proposing to 

discontinue add-on payments for the 

CRT–D for FY 2006. 

c. Kinetra Implantable Neurostimulator 

for Deep Brain Stimulation 

Medtronic, Inc. submitted an 

application for approval of the Kinetra

implantable neurostimulator device for 

new technology add-on payments for FY 

2005. The Kinetra device was 

approved by the FDA on December 16, 

2003. The Kinetra implantable 

neurostimulator is designed to deliver 

electrical stimulation to the subthalamic 

nucleus (STN) or internal globus 

pallidus (GPi) in order to ameliorate 

symptoms caused by abnormal 

neurotransmitter levels that lead to 

abnormal cell-to-cell electrical impulses 

in Parkinson’s Disease and essential 

tremor. Before the development of 

Kinetra, treating bilateral symptoms of 

patients with these disorders required 

the implantation of two 

neurostimulators (in the form of a 

product called SoletraTM, also 

manufactured by Medtronic): one for the 

right side of the brain (to control 

symptoms on the left side of the body), 

the other for the left side of the brain (to 

control symptoms on the right side of 

the body). Additional procedures were 

required to create pockets in the chest 

cavity to place the two generators 

required to run the individual leads. 

The Kinetra neurostimulator generator, 

implanted in the pectoral area, is 

designed to eliminate the need for two 

devices by accommodating two leads 

that are placed in both the left and right 

sides of the brain to deliver the 

necessary impulses. The manufacturer 

argued that the development of a single 

neurostimulator that treats bilateral 

symptoms provides a less invasive 

treatment option for patients, and 

simpler implantation, follow up, and 

programming procedures for physicians. 

In December 2003, the FDA approved 

the device. Therefore, for FY 2006, 

Kinetra qualifies under the newness 

criterion because FDA approval was 

within the statutory timeframe of 2 to 3 

years and its costs are not yet reflected 

in the DRG weights. Because there were 

no data available to evaluate costs 

associated with Kinetra, in the FY 

2005 IPPS final rule, we conducted the 

cost analysis using SoletraTM, the 

predecessor technology used to treat 

this condition, as a proxy for Kinetra. 

The preexisting technology provided the 

closest means to track cases that have 

actually used similar technology and 

served to identify the need and use of 

the new device. The manufacturer 

informed us that the cost of the Kinetra

device is twice the price of a single 

SoletraTM device. Because most patients 

would receive two SoletraTM devices if 

the Kinetra device is not implanted, 

we believed data regarding the cost of 

SoletraTM would give a good measure of 

the actual costs that would be incurred. 

Medtronic submitted data for 104 cases 

that involved the SoletraTM device (26 

cases in DRG 1 (Craniotomy Age > 17 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23357 

With CC), and 78 cases in DRG 2 

(Craniotomy Age > 17 Without CC)). 

These cases were identified from the FY 

2002 MedPAR file using procedure 

codes 02.93 (Implantation, intracranial 

neurostimulator) and 86.09 (Other 

incision of skin and subcutaneous 

tissue). In the analysis presented by the 

applicant, the mean standardized 

charges for cases involving SoletraTM in 

DRGs 1 and 2 were $69,018 and 

$44,779, respectively. The mean 

standardized charge for these SoletraTM

cases according to Medtronic’s data was 

$50,839. 

Last year, we used the same 

procedure codes to identify 187 cases 

involving the SoletraTM device in DRGs 

1 and 2 in the FY 2003 MedPAR file. 

Similar to the Medtronic data, 53 of the 

cases were found in DRG 1, and 134 

cases were found in DRG 2. The average 

standardized charges for these cases in 

DRGs 1 and 2 were $51,163 and 

$44,874, respectively. Therefore, the 

case-weighted average standardized 

charge for cases that included 

implantation of the SoletraTM device 

was $46,656. The new cost thresholds 

established under the revised criteria in 

Pub. L. 108–173 for DRGs 1 and 2 are 

$43,245 and $30,129, respectively. 

Accordingly, the case-weighted 

threshold to qualify for new technology 

add-on payment using the data we 

identified was determined to be 

$33,846. Under this analysis, Kinetra

met the cost threshold. 

We note that an ICD–9–CM code was 

approved for dual array pulse generator 

devices, effective October 1, 2004, for 

IPPS tracking purposes. The new ICD–

9–CM code that will be assigned to this 

device is 86.95 (Insertion or 

replacement of dual array 

neurostimulator pulse generator), which 

includes dual array and dual channel 

generators for intracranial, spinal, and 

peripheral neurostimulators. The code 

will not separately identify cases with 

the Kinetra device and will only be 

used to distinguish single versus dual 

channel-pulse generator devices. 

Because the code only became effective 

on October 1, 2004, we do not have any 

specific data regarding the costs of cases 

involving dual array pulse generator 

devices. 

The manufacturer claimed that 

Kinetra provides a range of substantial 

improvements beyond previously 

available technology. These include a 

reduced rate of device-related 

complications and hospitalizations or 

physician visits and less surgical trauma 

because only one generator implantation 

procedure is required. Kinetra has a 

reed switch disabling function that 

physicians can use to prevent 

inadvertent shutoff of the device, as 

occurs when accidentally tripped by 

electromagnetic inference (caused by 

common products such as metal 

detectors and garage door openers). 

Kinetra also provides significant 

patient control, allowing patients to 

monitor whether the device is on or off, 

to monitor battery life, and to fine-tune 

the stimulation therapy within 

clinician-programmed parameters. 

While Kinetra provides the ability for 

patients to better control their 

symptoms and reduce the complications 

associated with the existing technology, 

it does not eliminate the necessity for 

two surgeries. Because the patients who 

receive the device are often frail, the 

implantation generally occurs in two 

phases: the brain leads are implanted in 

one surgery, and the generator is 

implanted in another surgery, typically 

on another day. However, implanting 

Kinetra does reduce the number of 

potential surgeries compared to its 

predecessor (which requires two 

surgeries to implant the two single-lead 

arrays to the brain and an additional 

surgery for implantation of the second 

generator). Therefore, the Kinetra

device reduces the number of surgeries 

from 3 to 2. 

Last year, we solicited comments on 

(1) the issue of whether the device is 

sufficiently different from the 

previously used technology to qualify as 

a substantially improved treatment for 

the same patient symptoms; (2) the cost 

of the device; and (3) the approval of the 

device for add-on payment, given the 

uncertainty over the frequency with 

which the patients receiving the device 

have the generator implanted in a 

second hospital stay, and the frequency 

with which this implantation occurs in 

an outpatient setting. In the response, 

we received sufficient evidence to 

demonstrate that Kinetra does 

represent a substantial clinical 

improvement over the previous 

Soletra TM device. Specifically, the 

increased patient control, reduced 

surgery, fewer complications, and 

elimination of environmental 

interference significantly improve 

patient outcomes. Therefore, we 

approved Kinetra for new technology 

add-on payments for FY 2005. 

Cases receiving Kinetra for 

Parkinson’s disease or essential tremor 

on or after October 1, 2004, are eligible 

to receive an add-on payment of up to 

$8,285, or half the cost of the device, 

which is approximately $16,570. These 

cases are identified by the presence of 

procedure codes 02.93 (Implantation or 

replacement of intracranial 

neurostimulator leads) and 86.95 

(Insertion or replacement of dual array 

neurostimulator pulse generator). If a 

claim has only the procedure code 

identifying the implantation of the 

intracranial leads, or if the claim 

identifies only insertion of the 

generator, no add-on payment will be 

made. 

This technology received FDA 

approval on December 16, 2003, and 

remains within the 2 to 3 year period 

during which it can be considered new. 

Therefore, we are proposing to continue 

add-on payments for Kinetra

Inplantable Neurostimulator for deep 

brain stimulation for FY 2006. 

4. FY 2006 Applications for New 

Technology Add-On 

a. INFUSE TM Bone Graft (Bone 

Morphogenetic Proteins (BMPs) for 

Tibia Fractures) 

Bone Morphogenetic Proteins (BMPs) 

have been shown to have the capacity 

to induce new bone formation and, 

therefore, to enhance the healing of 

fractures. Using recombinant 

techniques, some BMPs (also referred to 

as rhBMPs) can be produced in large 

quantities. This innovation has cleared 

the way for the potential use of BMPs 

in a variety of clinical applications such 

as in delayed union and nonunion of 

fractured bones and spinal fusions. One 

such product, rhBMP–2, is developed as 

an alternative to bone graft with spinal 

fusions. 

Medtronic Sofamor Danek 

(Medtronic) resubmitted an application 

(previously submitted for consideration 

for FY 2005) for a new technology addon payment in FY 2006 for the use of 

INFUSE TM Bone Graft in open tibia 

fractures. In cases of open tibia 

fractures, INFUSE TM is applied using an 

absorbable collagen sponge, which is 

then applied to the fractured bone to 

promote new bone formation and 

improved healing. The manufacturer 

contends that patient access to this 

technology is restricted due to the 

increased costs of treating these cases 

with INFUSE TM. The FDA approved use 

of INFUSE TM for open tibia fractures on 

April 30, 2004. 

Medtronic’s first application for a new 

technology add-on payment for 

INFUSE TM Bone Graft in open tibia 

fractures was denied. As we discussed 

in the FY 2005 IPPS final rule (69 FR 

49010), the FY 2005 application for 

INFUSE TM for open tibia fractures was 

denied because a similar product, OP–

1, was approved in 2001 for the 

treatment of nonunion of tibia fractures. 

Comment: In comments presented at 

the February 2005 new technology town 

hall meeting, Medtronic contended that 

there was no opportunity for public 

23358 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

comment on our decision regarding OP–

1 Putty: ‘‘the public had no opportunity 

to comment on whether the follow-on 

products were ‘substantially similar’ to 

the primary technologies under 

consideration. The absence of such 

provisions led to unpredictability and 

confusion about the new-technology 

add-on program.’’

Response: In the FY 2005 IPPS final 

rule, we noted that a commenter 

brought the existence of the Stryker 

Biotech OP–1 product to our attention 

during the comment period on the IPPS 

proposed rule for FY 2005. The 

commenter noted OP–1’s clinical 

similarity to INFUSE TM and contended 

that the products should be treated the 

same with respect to new technology 

payments when the product is used for 

tibia fractures. At that time, we 

determined that, despite the differences 

in indications under the respective FDA 

approvals, the two products were in use 

for many of the same kinds of cases. 

Specifically, clinical studies on the 

safety of OP–1 included patients with 

complicated fractures of the tibia, and 

those cases were similar to the cases 

described in the clinical trials for 

INFUSE TM for open tibia fractures. In 

addition, cases involving the use of OP–

1 for long bone union and open tibia 

fractures are assigned to the same DRGs 

(DRGs 218 and 219 (Lower Extremity 

Procedures With and Without CC, 

respectively)) as cases involving 

INFUSE TM. Therefore, we denied new 

technology add-on payments for 

INFUSE TM for open tibia fractures for 

FY 2005 on the grounds that the 

technology involving the use of bone 

morphogenetic proteins to treat severe 

long bone fractures (including open 

tibia fractures) and recalcitrant long 

bone fractures had been in use for more 

than 3 years. 

We note that Medtronic had ample 

opportunity, prior to the issuance of the 

FY 2005 IPPS final rule, to bring to our 

attention the fact that there was a 

similar product on the market that was 

being used in long bone fractures. We 

based our decision for FY 2005 on the 

record that was placed at our disposal 

by the applicant and by commenters 

during the comment period. 

Nevertheless, we have considered the 

issues raised by these two products 

again in the course of evaluating 

Medtronic’s new application for 

approval of INFUSE TM for new 

technology add-on payments in FY 

2006. 

As part of its FY 2006 application, 

Medtronic advanced several arguments 

designed to demonstrate that OP–1 and 

INFUSE TM are substantially different. 

The application cites data from several 

studies as evidence of the clinical 

superiority of INFUSE TM over OP–1. 

Medtronic presented studies at the 

February 2005 new technology town 

hall meeting to provide evidence that 

INFUSE TM is superior to OP–1 in the 

time it takes for critical-sized defects to 

heal and in radiographic assessment, 

mechanical testing of the repaired bone, 

and histology of the union for trial 

subjects receiving INFUSE TM compared 

with OP–1. (Study subjects were 

canines whose ulnas had 2.5 cm each of 

bone removed and then equal amounts 

of OP–1 and INFUSE TM were put into 

the front legs in a head to head trial.) 

Medtronic has also argued that these 

studies demonstrate that OP–1 has been 

shown to be less effective than using the 

patient’s own bone or the current 

standard of care (nail fixation with soft 

tissue medical management). Medtronic 

argued that the INFUSE TM product is 

not only superior to OP–1 for patients 

with open tibia fractures, but also that 

it is superior to any other treatment for 

these serious injuries. 

Medtronic also pointed out that the 

FDA approved OP–1 for Humanitarian 

Device Exemption (HDE) status, 

whereas INFUSE TM received a PreMarket Approval (PMA). To receive 

HDE approval, a product only needs to 

meet a safety standard, while standards 

of both safety and efficacy have to be 

met for a PMA approval. Medtronic 

argued that, because the only point the 

manufacturer of OP–1 was able to prove 

was that it did not harm those 

individuals that received it, the efficacy 

of OP–1 not only has not been 

demonstrated for the general 

population, but also more specifically, it 

has not been proven in the Medicare 

population. Medtronic presented 

arguments that INFUSE TM is a superior 

product to OP–1 because the INFUSE TM

product has demonstrated safety and 

efficacy, while the OP–1 product has 

merely demonstrated that it is safe to 

use in humans. Medtronic pointed to 

the labeled indications and package 

inserts provided with the two products, 

stating that only INFUSE TM provides a 

substantial clinical improvement to 

patients receiving a BMP product. 

We do not believe that the different 

types of FDA approvals for the two 

products are relevant to distinguish 

between the two products in 

determining whether either product 

should be considered for new 

technology add-on payments under the 

IPPS. Manufacturers seek different types 

of FDA approval for many different 

reasons, including timing, the 

availability of adequate studies, the 

availability of resources to pursue 

research studies, and the size of the 

patient population that may be affected. 

The FDA has stated that the HDE 

approval process was established to 

address cases involving devices used in 

the treatment or diagnosis of diseases 

affecting fewer than 4,000 individuals in 

the United States per year: ‘‘A device 

manufacturer’s research and 

development costs could exceed its 

market returns for diseases or 

conditions affecting small patient 

populations. FDA, therefore, developed 

and published [the regulation 

establishing the HDE process] to provide 

an incentive for the development of 

devices for use in the treatment or 

diagnosis of diseases affecting these 

populations.’’ (http:// 

www.accessdata.fda.gov/scripts/cdrh/ 

cfdocs/cfHDE/HDEInformation.cfm). 

The fact that two products received 

different types of approval does not 

demonstrate either that they are 

substantially different for purposes of 

new technology add-on payments, or 

that one is new and the other is not. Nor 

do the different types of FDA approval 

imply that one product could meet our 

substantial clinical improvement 

criterion and the other could not. 

Neither type of FDA approval requires 

that products establish substantial 

clinical improvement, as is required for 

approval of new technology add-on 

payments. Theoretically, a product that 

receives an FDA HDE approval could 

subsequently meet our substantial 

clinical improvement criterion, while a 

product that receives an FDA PMA 

approval could fail to do so. We base 

our substantial clinical improvement 

determinations on the evidence 

presented in the course of the 

application process, and not on the type 

of FDA approval. 

For purposes of determining whether 

the use of rhBMPs for open tibia fracture 

represents a new technology, the crucial 

consideration is whether the costs of 

this technology are represented in the 

weights of the relevant DRGs. Cases that 

involve treatment of non-healed and 

acute tibia fractures fall into the same 

DRGs. We have identified 10,047 cases 

involving the use of rhBMPs in the FY 

2004 MedPAR data file. This use 

includes the approved indications for 

INFUSE TM in spinal fusions (6,712 

cases) and tibia DRGs (77 cases). 

However, we note that an additional 

3,258 cases involving the off-label use of 

rhBMPs were found in 47 DRGs in the 

FY 2004 MedPAR data. We also note 

that, in our analysis of the FY 2003 

MedPAR data, an additional 890 cases 

of off-label use (identified by the 

presence of ICD–9–CM code 84.52) were 

found in 36 DRGs. Therefore, we note 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23359 

that the use of rhBMPs, made by 

Medtronic or otherwise, has penetrated 

the cost data that were used to set the 

FY 2005 and FY 2006 DRG weights. 

Whether or not it is possible to 

differentiate between patient 

populations that would be eligible to 

receive the OP–1 Implant for nonunions 

or the INFUSE TM bone graft for open 

tibia fractures, the patient populations 

both fall into the same DRGs. In 

addition, we have determined that the 

costs associated with the two products 

are comparable (69 FR 49009). 

Therefore, because BMP products have 

been used in treating both types of 

fractures included in the same DRGs 

since 2001, we continue to believe that 

the hospital charge data used in 

developing the relative weights reflect 

the costs of these products. 

Comment: In our Federal Register 

announcement of the February 23, 2005 

new technology town hall meeting, held 

on February 23, 2005, we solicited 

comments on the issue of when 

products should be considered 

substantially similar. As a result, 

Medtronic recommended several criteria 

for determining whether two or more 

products are substantially similar and 

requested that we apply these criteria in 

determining whether OP–1 and 

INFUSE TM are similar for new 

technology add-on payment purposes. 

The three criteria recommended by 

Medtronic are: 

• The technologies or services in 

question use the same, or a similar, 

mechanism of action to achieve the 

therapeutic outcome. 

• The technologies or services are 

indicated for use in the same population 

for the same condition. 

• The technologies or services 

achieve the same level of substantial 

improvement. 

Medtronic has also argued that, 

according to its proposed criteria, OP–

1 would fail on two of the three 

proposed tests for substantial similarity: 

• According to Medtronic, the OP–1 

implant ‘‘arguably’’ uses the same or a 

similar mechanism of action to achieve 

the therapeutic outcome. 

• OP–1 and INFUSE TM are indicated 

for use in different population and 

different conditions. According to 

Medtronic, INFUSE TM Bone Graft has 

an indication for acute, open tibia 

fractures only, used within 14 days, and 

is to be used with an intramedullary 

(IM) nail as part of the primary 

procedure. There is no limitation on the 

number of patients that can receive the 

technology. OP–1 Implant is indicated 

only for recalcitrant long-bone nonunions that have failed to heal. The HDE 

approval also specifies that use of OP–

1 is limited to secondary procedures (as 

would be expected with nonunions). 

The number of patients able to receive 

the device is limited to 4,000 patients 

per year and with oversight from an 

Institutional Review Board. 

• Medtronic argues the products do 

not achieve the same level of substantial 

improvement (as discussed above). 

Response: We agree with Medtronic 

that the first proposed criterion has 

some relevance in determining whether 

products are substantially similar. In 

evaluating the application for new 

technology add-on payments last year, 

we made the determination that, while 

these products are not identical 

chemically, the products do use the 

same mechanism of action to achieve 

the therapeutic outcome. However, we 

do not agree that the other two criteria 

recommended by Medtronic are relevant 

considerations for this purpose. As we 

have discussed above, we believe that 

whether cases involving different 

products are assigned to the same DRGs 

is a more relevant consideration than 

whether the products have the same 

specific indications. In addition, as we 

have already stated, we continue to 

believe that the hospital charge data 

used in developing the relative weights 

of the relevant DRGs reflect the costs of 

these products. Furthermore, we do not 

necessarily agree that considerations 

about the degrees of clinical 

improvements offered by different 

products should enter into decisions 

about whether products are new. We 

have always based our decisions about 

new technology add-on payments on a 

logical sequence of determinations, 

moving from the newness criterion to 

the cost criterion and finally to the 

substantial clinical improvement 

criterion. Specifically, we do not make 

determinations about substantial 

improvement unless a product has 

already been determined to be new and 

to meet the cost criterion. Therefore, we 

are reluctant to import substantial 

clinical improvement considerations 

into the logical prior decision about 

whether technologies are new. 

Furthermore, while we may sometimes 

need to make separate determinations 

about whether similar products meet the 

substantial clinical improvement 

criterion, we do not believe that it 

would be appropriate to make 

determinations about whether one 

product or another is clinically superior. 

However, we welcome comments while 

we continue to consider these issues. 

Comment: Medtronic suggested 

revisions to the application process that 

are designed to assist in identifying 

substantially similar products and 

provide the public with opportunity for 

comment on specific instances in which 

substantial similarity is an issue. The 

suggested proposed revisions are: 

• After receipt of all new applications 

for a fiscal year, CMS should publish a 

Federal Register notice specifically 

asking manufacturers to identify if they 

wish to receive consideration for 

products that may be substantially 

similar to applications received. Such 

notice would probably occur in January. 

Responses would be required by a date 

certain in advance of the new 

technology town hall meeting, and 

would include justification of how the 

products meet the ‘‘substantial 

similarity’’ criteria. 

• The new technology town hall 

meeting should include a discussion of 

products identified by manufacturers as 

‘‘substantially similar’’ to other 

approved products or pending 

applications. 

• CMS should publish initial findings 

about ‘‘substantial similarity’’ in the 

proposed hospital inpatient rule, with 

opportunity for public comment. 

• CMS should publish ultimate 

findings in the inpatient final rule. 

Alternatively, Medtronic suggested 

that, if a manufacturer identifies a 

product that may be substantially 

similar to a technology with an 

approved add-on payment, the 

manufacturer may choose to submit an 

application under the normal deadlines 

for the add-on payment program. 

Response: We appreciate Medtronic’s 

suggestions for evaluating similar 

technologies for new technology add-on 

payment. We have stated on several 

occasions that we wish to avoid creating 

situations in which similar products 

receive different treatment because only 

one manufacturer has submitted an 

application for new technology add-on 

payments. As we discussed in the 

September 7, 2001 Federal Register (66 

FR 46915), an approval of a new 

technology for special payment should 

extend to all technologies that are 

substantially similar. Otherwise, our 

payment policy would bestow an 

advantage to the first applicant to 

receive approval for a particular new 

technology. 

In addition, we note that commenters 

on the FY 2005 proposed rule placed a 

great deal of emphasis on the fact that 

many manufacturers developing new 

technologies are not aware of the 

existence of the add-on payment 

provision or lack the resources to apply 

for add-on payment. Therefore, 

commenters on that proposed rule 

argued that the regulations we have 

established are already too stringent and 

cumbersome, especially for small 

manufacturers to access the new 

23360 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

technology add-on payment process. 

The proposal by Medtronic would place 

further burden on these small 

manufacturers, both to know that an 

application has been made for a similar 

product and to make representations on 

a product that may or may not be on the 

market. Therefore, we are reluctant to 

adopt a process that places the formal 

burden on a competitor to seek equal 

treatment. However, we welcome 

comments while we continue to 

consider these issues. 

We note that Medtronic submitted 

data on 236 cases using INFUSE TM for 

open tibia fractures in the FY 2003 

MedPAR data file, as identified by 

procedure code 79.36 (Reduction, 

fracture, open, internal fixation, tibia 

and fibula) and diagnosis codes of either 

823.30 (Fracture of tibia alone, shaft, 

open) or 823.32 (Fracture of fibula and 

tibia, shaft, open). Medtronic also noted 

that the patients in clinical trials with 

malunion fractures (diagnosis code 

733.81) or nonunion fractures (diagnosis 

code 733.82) would also be likely 

candidates to receive INFUSE TM. Based 

on the data submitted by the applicant, 

INFUSE TM would be used primarily in 

two different DRGs: 218 and 219 (Lower 

Extremity and Humerus Procedures 

Except Hip, Foot, Femur Age > 17, With 

and Without CC, respectively). The 

analysis performed by the applicant 

resulted in a case-weighted cost 

threshold of $24,461 for these DRGs. 

The average case-weighted standardized 

charge for cases using INFUSE TM in 

these DRGs would be $39,537. 

Therefore, the applicant maintains that 

INFUSE TM for open tibia fractures 

meets the cost criterion. 

However, because the costs of 

INFUSE TM and OP–1 are already 

reflected in the relevant DRGs, these 

products cannot be considered new. 

Therefore, we are proposing to deny 

new technology add-on payments for 

INFUSE TM bone graft for open tibia 

fractures for FY 2006. 

b. AquadexTM System 100 Fluid 

Removal System (System 100) 

CHF Solutions, Inc. resubmitted an 

application (previously submitted for 

consideration for FY 2005) for the 

approval of the System 100 for new 

technology add-on payments for FY 

2006. The System 100 is designed to 

remove excess fluid (primarily excess 

water) from patients suffering from 

severe fluid overload through the 

process of ultrafiltration. Fluid 

retention, sometimes to an extreme 

degree, is a common problem for 

patients with chronic congestive heart 

failure. This technology removes excess 

fluid without causing hemodynamic 

instability. It also avoids the inherent 

nephrotoxicity and tachyphylaxis 

associated with aggressive diuretic 

therapy, the mainstay of current therapy 

for fluid overload in congestive heart 

failure. 

The System 100 consists of: (1) An S–

100 console; (2) a UF 500 blood circuit; 

(3) an extended length catheter (ELC); 

and (4) a catheter extension tubing. The 

System 100 is designed to monitor the 

extracorporeal blood circuit and to alert 

the user to abnormal conditions. 

Vascular access is established via the 

peripheral venous system, and up to 4 

liters of excess fluid can be removed in 

an 8-hour period. 

On June 3, 2002, FDA approved the 

System 100 for use with peripheral 

venous access. On November 20, 2003, 

FDA approved the System 100 for 

expanded use with central venous 

access and catheter extension use for 

infusion or withdrawal circuit line with 

other commercially applicable venous 

catheters. According to the applicant, 

although the FDA first approved System 

100 in June 2002, it was not used by 

hospitals until August 2002 because of 

the substantial amount of time 

necessary to market and sell the device 

to hospitals. The applicant presented 

data and evidence demonstrating that 

the System 100 was not marketed until 

August 2002. 

We note the applicant submitted an 

application for FY 2005 and was denied 

new technology add-on payments. Our 

review indicated that the applicant did 

not present sufficient objective clinical 

evidence to determine that the System 

100 meets the substantial clinical 

improvement criterion (such as a large 

prospective, randomized clinical trial) 

even though it is indicated for use in 

patients with congestive heart failure, a 

common condition in the Medicare 

population. However, for FY 2006, we 

are proposing to deny System 100 new 

technology add-on payments on the 

basis of our determination that it is no 

longer new. Technology is no longer 

considered new 2 to 3 years after data 

reflecting its costs begin to become 

available. Because data on the costs of 

the System 100 first became available in 

2002, the costs are currently reflected in 

the DRG weights and the device is no 

longer new. 

The applicant also submitted 

information for the cost and substantial 

clinical improvement criteria. As stated 

last year, it is important to note at the 

outset of the cost analysis that the 

console is reusable and is, therefore, a 

capital cost. Only the circuits and 

catheters are components that represent 

operating expenses. Section 

1886(d)(5)(K)(i) of the Act requires that 

the Secretary establish a mechanism to 

recognize the costs of new medical 

services or technologies under the 

payment system established under 

subsection (d) of section 1886, which 

establishes the system for paying for the 

operating costs of inpatient hospital 

services. The system of payment for 

capital costs is established under 

section 1886(g) of the Act, which makes 

no mention of any add-on payments for 

a new medical service or technology. 

Therefore, it is not appropriate to 

include capital costs in the add-on 

payments for a new medical service or 

technology and these costs should also 

not be considered in evaluating whether 

a technology meets the cost criterion. 

The applicant has applied for add-on 

payments for only the circuits and 

catheter, which represent the operating 

expenses of the device. However, as 

stated in the FY 2005 IPPS final rule, we 

believe that the catheters cannot be 

considered new technology for this 

device. As a result, we considered only 

the UF 500 disposable blood circuit as 

relevant to the evaluation of the cost 

criterion. 

The applicant submitted data from the 

FY 2003 MedPAR file in support of its 

application for new technology add-on 

payments for FY 2006. The applicant 

used a combination of diagnosis codes 

to determine which cases could 

potentially use the System 100. The 

applicant found 28,155 cases with the 

following combination of ICD–9-CM 

diagnosis codes: 428.0 through 428.9 

(Heart Failure), 402.91 (Unspecified 

with Heart Failure), or 402.11 

(Hypertensive Heart Disease with Heart 

Failure), in combination with 276.6 

(Fluid Overload) and 782.3 (Edema). 

The 28,155 cases were found among 148 

DRGs with 50.1 percent of cases 

mapped across DRGs 88, 89, 127, 277 

and 316. The applicant eliminated those 

DRGs with less than 150 cases, which 

resulted in a total of 22,620 cases that 

could potentially use the System 100. 

The case-weighted average standardized 

charge across all DRGs was $13,619.32. 

The case-weighted threshold across all 

DRGs was $16,125.42. Although the 

case-weighted threshold is greater than 

the case-weighted standardized charge, 

it is necessary to include the 

standardized charge for the circuits used 

in each case. In order to establish the 

charge per circuit, the applicant 

submitted data regarding 76 actual cases 

that used the System 100. Based on 

these 76 cases, the standardized charge 

per circuit was $2,591. The applicant 

also stated that an average of two 

circuits are used per case. Therefore, 

adding $5,182 for the charge of the two 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23361 

circuits to the case-weighted average 

standardized charge of $13,619.32 

results in a total case-weighted 

standardized charge of $18,801.32. This 

amount is greater than the caseweighted threshold of $16,125.42. 

The applicant contended that the 

System 100 represents a substantial 

clinical improvement for the following 

reasons: It removes excess fluid without 

the use of diuretics; it does not lead to 

electrolyte imbalance, hemodynamic 

instability or worsening renal function; 

it can restore diuretic responsiveness; it 

does not adversely affect the reninangiotensin system; it reduces length of 

hospital stay for the treatment of 

congestive heart failure, and it requires 

only peripheral venous access. The 

applicant also noted that there are some 

clinical trials that have demonstrated 

the clinical safety and effectiveness as 

well as cost effectiveness of the System 

100 in treating patients with fluid 

overload. 

However, as stated above, we are 

proposing to deny new technology addon payments for the System 100 because 

it does not meet the newness criterion. 

We received no public comments 

regarding this application for add-on 

payments. 

c. CHARITETM Artificial Disc 

(CHARITETM) 

DePuy SpineTM submitted an 

application for new technology add-on 

payments for the CHARITETM Artificial 

Disc for FY 2006. This device is a 

prosthetic intervertebral disc. DePuy 

SpineTM stated that the CHARITETM

Artificial Disc is the first artificial disc 

approved for use in the United States. 

It is a 3-piece articulating medical 

device consisting of a sliding core that 

is placed between two metal endplates. 

The sliding core is made from a medical 

grade plastic and the endplates are 

made from medical grade cobalt 

chromium alloy. The endplates support 

the core and have small teeth that are 

secured to the vertebrae above and 

below the disc space. The sliding core 

fits in between the endplates. 

On October 26, 2004, the FDA 

approved the CHARITETM Artificial 

Disc for single level spinal arthroplasty 

in skeletally mature patients with 

degenerative disc disease (DDD) 

between L4 and S1. The FDA further 

stated that DDD is defined as discogenic 

back pain with degeneration of the disc 

confirmed by patient history and 

radiographic studies. These DDD 

patients should have no more than 3 

mm of spondylolisthesis at an involved 

level. Patients receiving the CHARITETM

Artificial Disc should have failed at 

least 6 months of conservative treatment 

prior to implantation of the CHARITETM

Artificial Disc. Because the device is 

within the statutory timeframe of 2 to 3 

years and data is not yet reflected 

within the DRGs, we consider the 

CHARITETM Artificial Disc to meet the 

newness criterion. 

We note that an ICD–9–CM code was 

effective October 1, 2004, for IPPS 

tracking purposes. The code assigned to 

the CHARITETM was 84.65 (Insertion of 

total spinal disc prosthesis, 

lumbosacral). 

For analysis of the cost criterion, the 

applicant submitted two sets of data: 

one that used actual cases and one that 

used FY 2003 MedPAR cases. The 

applicant expects that cases using the 

CHARITETM will map to DRGs 499 and 

500. The applicant submitted 68 actual 

cases from 35 hospitals that used the 

CHARITETM. Of these 68 cases, only 3 

were Medicare patients; the remaining 

cases were privately insured patients or 

patients for whom the payer was 

unknown. Using data from the 68 actual 

cases, the average standardized charge 

was $40,722. The applicant maintained 

that this figure is well in excess of the 

thresholds for DRGs 499 and 500 

(regardless of a case weighted threshold) 

of $24,828 and $17,299 respectively. 

Based on this analysis, the applicant 

maintained that the CHARITE ́ TM meets 

the cost criterion because the average 

standardized charge exceeds the charge 

thresholds for DRGs 499 and 500. 

In addition, as stated above, the 

applicant submitted cases from the FY 

2003 MedPAR file. The applicant 

searched the MedPAR file for ICD–9–

CM procedure codes 81.06, 81.07, and 

81.08 in combination with diagnosis 

codes 722.10, 722.2, 722.5, 722.52, 

722.6, 722.7, 722.73 and 756.12, to 

identify a patient population that could 

be eligible for the CHARITETM Artificial 

Disc and found a total of 12,680 cases. 

However, these cases are from the FY 

2003 MedPAR file and precede the 

effective date of ICD–9–CM code 84.65 

that is currently used to track the 

device. Of these 12,680 cases, 55.5 

percent were reported in DRG 497, and 

44.5 percent were reported in DRG 498. 

The applicant stated that cases using the 

CHARITETM device group to the DRGs 

for back and neck procedures that 

exclude spinal fusions (DRGs 499 and 

500). However, the applicant argues that 

the CHARITETM could be a substitute 

for spinal fusion procedures found in 

DRGs 497 and 498 and, therefore, used 

cases from these DRGs to evaluate 

whether the CHARITETM meets the cost 

criterion and to argue that procedures 

using the technology should be grouped 

to the spinal fusion DRGs. The average 

standardized charge per case was 

$50,098 for DRG 497 and $41,290 for 

DRG 498. Using revenue codes 272 and 

278 from the MedPAR file, the applicant 

then subtracted the charges for surgical 

and medical supplies used in 

connection with spinal fusion 

procedures, which resulted in a 

standardized charge of all other charges 

of $24,333 for DRG 497 and $22,183 for 

DRG 498. Based on the actual cases 

above, the applicant then estimated the 

average standardized charge for surgical 

and medical supplies per case for the 

CHARITETM was $20,033. The applicant 

estimated that charges have grown by 15 

percent from FY 2003 to FY 2005 and, 

therefore, deflated the average 

standardized charge for surgical and 

medical supplies of the CHARITETM by 

15 percent to $17,420. The applicant 

then added the average standardized 

charge for surgical and medical supplies 

of the CHARITETM to the standardized 

charge of all other charges for DRG 497 

and 498 and also inflated the charges by 

15 percent in order to update the data 

to FY 2005 charge levels. This 

amounted to a case-weighted average 

standardized charge of $46,256. 

Although the analysis was completed 

with DRGs 497 and 498, it is necessary 

to compare the average standardized 

charge to the thresholds of DRGs 499 

and 500 because the GROUPER maps 

these cases to DRGs 499 and 500. As a 

result, the case-weighted threshold was 

$21,480. Similar to the analysis above, 

the applicant stated that the caseweighted average standardized charge is 

greater than the case-weighted threshold 

and, as a result, the applicant 

maintained that the CHARITETM meets 

the cost criterion. 

The applicant also contended that the 

CHARITETM represents a substantial 

clinical improvement over existing 

technology. Use of the CHARITETM may 

eliminate the need for spinal fusion and 

the use of autogenous bone, and the 

applicant stated that, based on the 

Investigational Device Exemption (IDE) 

study, ‘‘A Prospective Randomized 

Multicenter Comparison of Artificial 

Disc vs. Fusion for Single Level Lumbar 

Degenerative Disc Disease’’

(Blumenthal, S, et al, National 

American Spine Society 2004 Abstract) 

that patients who received the 

CHARITETM Artificial Disc were 

discharged from the hospital after an 

average of 3.7 days compared to 4.2 

days in the fusion group. Furthermore, 

the applicant stated that patients who 

received the CHARITETM Artificial Disc 

had a statistically greater improvement 

in Oswetry Disability Index scores and 

Visual Analog Scale Pain scores 

compared to the fusion group at 6 weeks 

23362 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

and 3, 6 and 12 months. The study also 

showed greater improvement from 

baseline compared to the fusion group 

on the Physical Component Score at 3, 

6, and 23 months. In addition, the 

applicant states that patients receiving 

the CHARITETM Artificial Disc returned 

to normal activities in half the time, 

compared to patients who underwent 

fusion, and at the 2 year follow up, 15 

percent of patients who underwent a 

fusion were dissatisfied with the 

postoperative improvements compared 

to 2 percent who received the 

CHARITETM Artificial Disc. Also, 

patients who received the CHARITETM

Artificial Disc returned to work on 

average of 12.3 weeks after surgery 

compared to 16.3 weeks after 

circumferential fusion and 14.4 weeks 

with Bagby and Kuslich cages. The 

applicant finally stated that the motion 

preserving technology of the 

CHARITETM Artificial Disc may reduce 

the risk of increase of degenerative disc 

disease (DDD). The applicant explained 

that degeneration of adjacent discs due 

to increased stress has been strongly 

associated with spinal fusion utilizing 

instrumentation. In a followup of 100 

patients (minimum 10 years) who 

received the CHARITETM Artificial Disc, 

the incidence of adjacent level DDD was 

2 percent. 

We are continuing to review the 

information on whether the 

CHARITE TM Artificial Disc would 

appear to represent a substantial clinical 

improvement over existing technology 

for certain patient populations. Based 

on the studies submitted to the FDA and 

CMS, we remain concerned that the 

information presented may not 

definitively substantiate whether the 

CHARITE TM Artificial Disc is a 

substantial clinical improvement over 

spinal fusion. In addition, we are 

concerned that the cited IDE study 

enrolled no patients over 60 years of 

age, which excludes much of the 

Medicare population, and we are 

concerned that the device is 

contraindicated in patients with 

‘‘significant osteoporosis,’’ which is 

quite common in the Medicare 

population. We invite comment on both 

of these points and on the more general 

question of whether the device satisfies 

the substantial clinical improvement 

criterion. 

Despite the issues mentioned above, 

we are still considering whether it is 

appropriate to approve new technology 

add-on payment status for the 

CHARITE TM Artificial Disc for FY 2006. 

If approved for add-on payments, the 

device would be reimbursed up to half 

of the costs for the device. Because the 

manufacturer has stated that the cost for 

the CHARITE TM Artificial Disc would 

be $11,500, the maximum add-on 

payment for the device would be 

$5,750. In the final rule, we will make 

a final determination on whether the 

CHARITE TM Artificial Disc should 

receive new technology add-on 

payments for FY 2006 based on public 

comments and our continuing analyses. 

We finally note that the applicant 

requested a DRG reassignment for cases 

of the CHARITE TM Artificial Disc from 

DRGs 499 (Back and Neck Procedures 

Except Spinal Fusion With CC) and 500 

(Back and Neck Procedures Except 

Spinal Fusion Without CC) to DRGs 497 

(Spinal Fusion Except Cervical With 

CC) and 498 (Spinal Fusion Except 

Cervical Without CC). The applicant 

argued that the costs associated with an 

artificial disc surgery are similar to 

spinal fusion and inclusion in DRGs 497 

and 498 would obviate the need to make 

a new technology add-on payment. On 

October 1, 2004, we created new codes 

for the insertion of spinal disc 

prostheses (codes 84.60 through 84.69). 

In the FY 2005 IPPS proposed rule and 

the final rule, we described the new 

DRG assignments for these new codes in 

Table 6B of the Addendum to the rules. 

We received a number of comments 

recommending that we change the DRG 

assignments from DRGs 499 and 500 in 

MDC 8 to the DRGs for spinal fusion 

(DRGs 497 and 498). In the FY 2005 

IPPS final rule (69 FR 48938), we 

indicated that DRGs 497 and 498 are 

limited to spinal fusion procedures. 

Because the surgery involving the 

CHARITE TM is not a spinal fusion, we 

decided not to include this procedure in 

these DRGs. However, we will continue 

to analyze this issue and are interested 

in public comments on both the new 

technology application for the 

CHARITE TM and the DRG assignment 

for spinal disc prostheses. 

We received no public comments 

regarding this application for new 

technology add-on payments. 

d. Endovascular Graft Repair of the 

Thoracic Aorta 

Endovascular stent-grafting of the 

descending thoracic aorta (TA) provides 

a less invasive alternative to the 

traditional open surgical approach 

required for the management of 

descending thoracic aortic aneurysms. 

W.L. Gore & Associates, Inc. submitted 

an application for consideration of its 

Endovascular Graft Repair of the 

Thoracic Aorta (GORE TAG) for new 

technology add-on payments for FY 

2006. The GORE TAG device is a 

tubular stent-graft mounted on a 

catheter-based delivery system, and it 

replaces the synthetic graft normally 

sutured in place during open surgery. 

The device is identified using ICD–9–

CM procedure code 39.79 (Other 

endovascular repair (of aneurysm) of 

other vessels). The applicant has 

requested a unique ICD–9–CM 

procedure code. 

At this point the time of the initial 

application, the FDA hads not yet 

approved this technology for general 

use. Subsequently, however, we were 

notified that FDA approval was granted 

on March 23, 2005. Although we 

discuss some of the data submitted with 

the application for new technology addon payments below, we are unable to 

include a detailed analysis of cost data 

and substantial clinical improvement 

data in this proposed rule because FDA 

approval occurred too late for us to 

conduct a complete analysis. 

The applicant submitted cost 

threshold information for the GORE 

TAG device. According to the 

manufacturer, cases using the GORE 

TAG device would fall into DRGs 110 

and 111 (Major Cardiovascular 

Procedures With and Without CC, 

respectively). The applicant identified 

185 cases in the FY 2003 MedPAR using 

procedure code 39.79 (Other 

endovascular repair (of aneurysm) of 

other vessels) and primary diagnosis 

codes 441.2 (Thoracic aneurysm, 

without mention of rupture), 441.1 

(Thoracic aneurysm, ruptured), or 

441.01 (Dissection of aorta, thoracic). 

The case-weighted standardized charge 

for 177 of these cases was $60,905. 

According to the manufacturer, the caseweighted cost threshold for these DRGs 

is $49,817. Based on this analysis, the 

manufacturer maintained that the 

technology meets our cost threshold. 

The manufacturer argued that the 

GORE TAG represents a substantial 

clinical improvement over existing 

technology, primarily by avoiding the 

traditional open aneurysm repair 

procedure with its associated high 

morbidity and mortality. The applicant 

argued that a descending thoracic aorta 

aneurysm is a potentially life 

threatening condition that currently 

requires a major operative procedure for 

its treatment. The mortality and 

complication rates associated with this 

surgery are very high, and the surgery is 

frequently performed under urgent or 

emergent conditions. The applicant 

noted that such complications can 

increase the length of the hospital stay 

and can include neurological damage, 

paralysis, renal failure, pulmonary 

emboli, hemorrhage, and sepsis. The 

average time for patients undergoing 

surgical repair to return to normal 

activity is 3 to 4 months, but can be 

significantly longer. 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23363 

In comparison, the applicant argued 

that endovascular stent-grafting done 

with the GORE TAG thoracic 

endoprosthesis is minimally invasive. 

The manufacturer noted that patients 

treated with the endovascular technique 

experience far less aneurysm-related 

mortality and morbidity, compared to 

those patients that receive the open 

procedure resulting in reduced overall 

length-of-stay, less intensive care unit 

days and less operative complications. 

We received the following public 

comments, in accordance with section 

503(b)(2) of Pub. L. 108–173, regarding 

this application for add-on payments. 

Comment: Several commenters 

expressed support for approval of new 

technology add-on payments for the 

GORE TAG device. These commenters 

noted that the data presented to the FDA 

advisory panel for consideration for 

FDA approval of the device clearly 

demonstrate the safety and efficacy of 

the GORE TAG device. They also noted 

that nearly 200 patients have been 

treated with the endografts, with a 

highly significant difference in both 

postoperative mortality and a reduction 

in the incidence of spinal cord ischemic 

complications, with some commenters 

noting the trial results, which showed a 

reduction in the rate of paraplegia from 

14 percent to 3 percent, compared to 

open surgery. The commenters also 

stressed the rigorous nature of the open 

surgery, which requires a left lateral 

thoracotomy, resulting in significant 

morbidity. The commenters further 

argued that, since many of the patients 

with degenerative aneurysm of the 

thoracic aorta are elderly or present 

with significant comorbidities, or both, 

it is ‘‘a common circumstance in clinical 

practice to deny repair to such patients 

because of the magnitude of the 

conventional open surgery.’’ Other 

commenters stated that the 5-year 

mortality in all patients diagnosed with 

thoracic aortic aneurysm is as high as 80 

percent in some groups of patients. 

Therefore, the commenters argued, the 

GORE TAG device for thoracic aortic 

aneurysm satisfies the criteria for 

substantial clinical improvement. 

Response: We appreciate the 

commenters’ input on this criterion. We 

will consider these comments regarding 

the substantial clinical improvement 

criterion in the final rule if we 

determine that the technology meets the 

other two criteria. 

Comment: A representative of another 

device manufacturer stated at the town 

hall meeting that the manufacturer has 

a similar product awaiting FDA 

approval. 

Response: As we discussed in the 

September 7, 2001 Federal Register (66 

FR 46915), an approval of a new 

technology for special payment should 

extend to all technologies that are 

substantially similar. Otherwise, our 

payment policy would bestow an 

advantage to the first applicant to 

receive approval for a particular new 

technology. In this case, we will 

determine whether the GORE TAG 

device qualifies for new technology addon payments in the FY 2006 final rule. 

In the event that this technology 

satisfies all the criteria, we would 

extend new technology payments to any 

substantially similar technology that 

also receives FDA approval prior to 

publication of the FY 2006 final rule. 

We welcome comments regarding this 

technology in light of its recent FDA 

approval, particularly with regard to the 

cost threshold and the substantial 

clinical improvement criteria. 

e. Restore Rechargeable Implantable 

Neurostimulator 

Medtronic Neurological submitted an 

application for new technology add-on 

payments for its Restore Rechargeable 

Implantable Neurostimulator. The 

Restore Rechargeable Implantable 

Neurostimulator is designed to deliver 

electrical stimulation to the spinal cord 

for treatment of chronic, intractable 

pain. 

Neurostimulation is designed to 

deliver electrical stimulation to the 

spinal cord to block the sensation of 

pain. The current technology standard 

for neurostimulators utilizes internal 

sealed batteries as the power source to 

generate the electrical current. These 

internal batteries have finite lives, and 

require replacement when their power 

has been completely discharged. 

According to the manufacturer, the 

Restore Rechargeable Implantable 

Neurostimulator ‘‘represents the next 

generation of neurostimulator 

technology, allowing the physician to 

set the voltage parameters in such a way 

that fully meets the patient’s 

requirements to achieve adequate pain 

relief without fear of premature 

depletion of the battery.’’ The applicant 

stated that the expected life of the 

Restore rechargeable battery is 9 years, 

compared to an average life of 3 years 

for conventional neurostimulator 

batteries. The applicant stated that this 

represents a significant clinical 

improvement because patients can use 

any power settings that are necessary to 

achieve pain relief with less concern for 

battery depletion and subsequent 

battery replacement. 

This device has not yet received 

approval for use by the FDA; however, 

another manufacturer has received 

approval for a similar device. 

(Advanced Bionics’ Precision

Rechargeable Neurostimulator was 

approved by the FDA on April 27, 

2004.) 

Medtronic Neurological also provided 

data to determine whether the Restore

Rechargeable Implantable 

Neurostimulator meets the cost 

criterion. Medtronic Neurological stated 

that the cases involving use of the 

device would primarily fall into DRGs 

499, 500, 531 and 532, which have a 

case-weighted threshold of $24,090. The 

manufacturer stated that the anticipated 

average standardized charge per case 

involving the Restore technology is 

$59,265. This manufacturer derived this 

estimate by identifying cases in the FY 

2003 MedPAR that reported procedure 

code 03.93 (Insertion or replacement of 

spinal neurostimulators). The 

manufacturer then added the total cost 

of the Restore Rechargeable 

Implantable Neurostimulator to the 

average standardized charges for those 

cases. Of the applicable charges for the 

Restore Rechargeable Implantable 

Neurostimulator, only the components 

that the applicant identified as new 

would be eligible for new technology 

add-on payments. Medtronic 

Neurological submitted information that 

distinguished the old and new 

components of the device and submitted 

data indicating that the neurostimulator 

itself is $17,995 and the patient 

recharger, antenna, and belt are $3,140. 

Thus, the total cost for new components 

would be $21,135, with a maximum 

add-on amount of $10,568 if the product 

were to be approved for new technology 

payments. 

We note that we reviewed a 

technology for add-on payments for FY 

2003 called RenewTM Radio Frequency 

Spinal Cord Stimulation (SCS) Therapy, 

made by Advanced Neuromodulation 

Systems (ANS). In the FY 2003 final 

rule, we discussed and subsequently 

denied an application for new 

technology add-on payment for 

RenewTM SCS because ‘‘RenewTM SCS 

was introduced in July 1999 as a device 

for the treatment of chronic intractable 

pain of the trunk and limbs.’’ (67 FR 

50019) We also noted, ‘‘[t]his system 

only requires one surgical placement 

and does not require additional 

surgeries to replace batteries as do other 

internal SCS systems.’’

The applicant also stated in its 

application for Restore that cases 

where it is used will be identified by 

ICD–9–CM procedure code 03.93 

(Insertion or replacement of spinal 

neurostimulators). As we discussed in 

the FY 2003 final rule (67 FR 50019), 

the RenewTM SCS is identified by the 

same ICD–9–CM procedure code. The 

23364 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

applicant has also applied for a new 

ICD–9–CM code for rechargeable 

neurostimulator pulse generator (We 

refer readers to Tables 6A through 6H in 

the Addendum to this proposed rule for 

information regarding ICD–9–CM 

codes.) Because both technologies are 

similar, we asked Medtronic to provide 

information that would demonstrate 

how the products were substantially 

different. The applicant noted that the 

RenewTM SCS, while programmable and 

rechargeable, is not a good option for 

those patients who have high energy 

requirements because of chronic 

intractable pain that will result in more 

battery wear and subsequent surgery to 

replace the device. Both systems rely on 

rechargeable batteries, and in the case of 

RenewTM SCS the energy is transmitted 

through the skin from a radiofrequency 

source for the purpose of recharging. 

The manufacturer of the Restore device 

contends that it is superior to the 

RenewTM device because RenewTM

requires an external component that 

uses a skin adhesive that is 

uncomfortable and inconvenient (causes 

skin irritation, is affected by moisture 

that will come from bathing, sweating, 

swimming, etc.), leading to patient 

noncompliance. 

Because FDA approval has not yet 

been received for this device, we are 

making no decision concerning the 

Restore application at this time. We 

will make a formal determination if 

FDA approval occurs in sufficient time 

for full consideration in the final FY 

2006 rule. However, we have 

reservations about whether this 

technology is new for purposes of the 

new technology add-on payments 

because of its similarity to other 

products that are also used to treat the 

same conditions. Although we recognize 

the benefits of a more easily 

rechargeable neurostimulator system, 

we believe that the Restore device may 

not be sufficiently different from 

predecessor devices to meet the 

newness criterion for the new 

technology add-on payment. As we 

discussed above, similar products have 

been on the market since 1999. 

Therefore, these technologies are 

already represented in the DRG weights 

and are not considered new for the 

purposes of the new technology add-on 

payment provision. We welcome 

comments on this issue, specifically 

regarding how the Restore device may 

or may not be significantly different 

from previous devices. We also seek 

comments on whether the product 

meets the cost and significant 

improvement criteria. 

We received no public comments 

regarding this application for add-on 

payments. 

f. Safe-Cross Radio Frequency Total 

Occlusion Crossing System (SafeCross) 

Intraluminal Therapeutics submitted 

an application for the Safe Cross Radio 

Frequency (RF) Total Occlusion 

Crossing System. This device performs 

the function of a guidewire during 

percutaneous transluminal angioplasty 

of chronic total occlusions of peripheral 

and coronary arteries. Using fiberoptic 

guidance and radiofrequency ablation, it 

is able to cross lesions where a standard 

guidewire is unsuccessful. On 

November 21, 2003, the FDA approved 

the Safe Cross for use in iliac and 

superficial femoral arteries. The device 

was approved by the FDA for all native 

peripheral arteries except carotids in 

August 2004. In January 2004, the FDA 

approved the Safe Cross for coronary 

arteries as well. Because the device is 

within the statutory timeframe of 2 to 3 

years for all approved uses and data 

regarding the cost of this device are not 

yet reflected within the DRG weights, 

we consider the Safe Cross to meet the 

newness criterion. 

We note that the applicant submitted 

an application for a distinctive ICD–9–

CM code. The applicant noted in its 

application that the device is currently 

coded with ICD–9–CM procedure codes 

36.09 (Other removal of coronary artery 

obstruction) and 39.50 (Angioplasty or 

atherectomy of other noncoronary 

vessels). 

As we stated in last year’s final rule, 

section 1886(d)(5)(K)(i) of the Act 

requires that the Secretary establish a 

mechanism to recognize the costs of 

new medical services or technologies 

under the payment system established 

under subsection (d) of section 1886, 

which establishes the system for paying 

for the operating costs of inpatient 

hospital services. The system of 

payment for capital costs is established 

under section 1886(g) of the Act, which 

makes no mention of any add-on 

payments for a new medical service or 

technology. Therefore, it is not 

appropriate to include capital costs in 

the add-on payments for a new medical 

service or technology, and these costs 

should not be considered in evaluating 

whether a technology meets the cost 

criterion. As a result, we consider only 

the Safe Cross crossing wire, ground 

pad, and accessories to be operating 

equipment that is relevant to the 

evaluation of the cost criterion. 

The applicant submitted the following 

two analyses on the cost criterion. The 

first analysis contained 27 actual cases 

from two hospitals. Of these 27 cases, 

25.1 percent of the cases were reported 

in DRGs 24 (Seizure and Headache Age 

>17 With CC), 107 (Coronary Bypass 

With Cardiac Catheterization), 125 

(Circulatory Disorders Except AMI, 

With Cardiac Catheterization and 

Without Complex Diagnosis), 518 

(Percutaneous Cardiovascular Procedure 

Without Coronary Artery Stent or AMI), 

and 526 (Percutaneous Cardiovascular 

Procedure With Drug-Eluting Stent With 

AMI); and 74.9 percent were reported in 

DRG 527 (Percutaneous Cardiovascular 

Procedure With Drug-Eluting Stent 

Without AMI). This resulted in a caseweighted threshold of $35,956 and a 

case-weighted average standardized 

charge of $40,319. Because the caseweighted average standardized charge is 

greater than the case-weighted 

threshold, the applicant maintained that 

the Safe Cross meets the cost criterion. 

The applicant also submitted cases 

from the FY 2003 MedPAR. The 

applicant found a total of 1,274,535 

cases that could be eligible for the Safe 

Cross using diagnosis codes 411 

through 411.89 (Other acute and 

subacute forms of ischemic heart 

disease) or 414 through 414.19 (Other 

forms of chronic ischemic heart disease) 

in combination with any of the 

following procedure codes: 36.01 

(Single vessel percutaneous 

transluminal coronary angioplasty 

(PTCA) or coronary atherectomy 

without mention of thrombolytic agent), 

36.02 (Single vessel PTCA or coronary 

atherectomy with mention of 

thrombolytic agent), 36.05 (Multiple 

vessel PTCA or coronary atherectomy 

performed during the same operation 

with or without mention of 

thrombolytic agent), 36.06 (Insertion of 

nondrug-eluting coronary artery 

stent(s)), 36.07 (Insertion of drug-eluting 

coronary artery stent(s)) and 36.09 

(Other removal of coronary artery 

obstruction). A total of 59.40 percent of 

these cases fell into DRG 517 

(Percutaneous Cardiovascular Procedure 

With Nondrug-Eluting Stent Without 

AMI), 16.4 percent of cases into DRG 

516 (Percutaneous Cardiovascular 

Procedure With AMI), and 16.2 percent 

of cases into DRG 527, while the rest of 

the cases fell into the remaining DRGs 

124, 518 and 526. The average caseweighted standardized charge per case 

was $40,318. This amount included an 

extra $6,000 for the charges related to 

the Safe Cross. The case-weighed 

threshold across the DRGs mentioned 

above was $35,955. Similar to the 

analysis above, because the caseweighted average standardized charge is 

greater than the case-weighted 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23365 

threshold, the applicant maintained that 

the Safe Cross meets the cost criterion. 

The applicant maintained that the 

device meets the substantial clinical 

improvement criterion. The applicant 

explained that many traditional 

guidewires fail to cross a total arterial 

occlusion due to difficulty in navigating 

the vessel and to the fibrotic nature of 

the obstructing plaque. By using 

fiberoptic guidance and radiofrequency 

ablation, the Safe Cross succeeds 

where standard guidewires fail. The 

applicant further maintained that in 

clinical trials where traditional 

guidewires failed, the Safe Cross

succeeded in 54 percent of cases of 

coronary artery chronic total occlusions 

(CTOs), and in 76 percent of cases of 

peripheral artery CTOs. 

However, we note that we use similar 

standards to evaluate substantial 

clinical improvement in the IPPS and 

OPPS. The IPPS regulations provide that 

technology may be approved for add-on 

payments when it ‘‘represents an 

advance in medical technology that 

substantially improves, relative to 

technologies previously available, the 

diagnosis or treatment of Medicare 

beneficiaries’’ (66 FR 46912). Under the 

OPPS, the standard for approval of new 

devices is ‘‘a substantial improvement in 

medical benefits for Medicare 

beneficiaries compared to the benefits 

obtained by devices in previously 

established (that is, existing or 

previously existing) categories or other 

available treatments’’ (67 FR 66782). 

Furthermore, the OPPS and IPPS 

employ identical language (for IPPS, see 

66 FR 46914, and for OPPS, see 67 FR 

66782) to explain and elaborate on the 

kinds of considerations that are taken 

into account in determining whether a 

new technology represents substantial 

improvement. In both systems, we 

employ the following kinds of 

considerations in evaluating particular 

requests for special payment for new 

technology: 

• The device offers a treatment option 

for a patient population unresponsive 

to, or ineligible for, currently available 

treatments. 

• The device offers the ability to 

diagnose a medical condition in a 

patient population where that medical 

condition is currently undetectable or 

offers the ability to diagnose a medical 

condition earlier in a patient population 

than allowed by currently available 

methods. There must also be evidence 

that use of the device to make a 

diagnosis affects the management of the 

patient. 

• Use of the device significantly 

improves clinical outcomes for a patient 

population as compared to currently 

available treatments. Some examples of 

outcomes that are frequently evaluated 

in studies of medical devices are the 

following: 

—Reduced mortality rate with use of the 

device. 

—Reduced rate of device-related 

complications. 

—Decreased rate of subsequent 

diagnostic or therapeutic 

interventions (for example, due to 

reduced rate of recurrence of the 

disease process). 

—Decreased number of future 

hospitalizations or physician visits. 

—More rapid beneficial resolution of 

the disease process treatment because 

of the use of the device. 

—Decreased pain, bleeding, or other 

quantifiable symptom. 

—Reduced recovery time. 

In a letter to the applicant dated 

October 25, 2004, we denied approval of 

the Safe Cross for pass-through 

payments for the OPPS on the basis that 

the technology did not meet the 

substantial clinical improvement 

criterion. In particular, we found that 

studies failed to show long-term or 

intermediate-term results, and the 

device had a relatively low rate of 

successfully opening occlusions. Since 

that initial determination, the applicant 

has requested reconsideration for passthrough payments under the IPPS. 

However, on the basis of the original 

findings under the OPPS, we do not 

now believe that the technology can 

qualify for new technology add-on 

payments under the IPPS. Therefore, we 

are proposing to deny new technology 

add-on payment for FY 2006 for Safe 

Cross on the grounds that it does not 

appear to be a substantial clinical 

improvement over existing technologies. 

We welcome further information on 

whether this device meets the 

substantial clinical improvement 

criterion, and we will consider any 

further information prior to making our 

final determination in the final rule. 

We received no public comments 

regarding this application for add-on 

payments. 

g. Trident Ceramic Acetabular System 

Stryker Orthopaedics submitted an 

application for new technology add-on 

payments for the Trident Ceramic 

Acetabular System. This system is used 

to replace the ‘‘ball and socket’’ joint of 

a hip when a total hip replacement is 

performed for patients suffering from 

arthritis or related conditions. The 

applicant stated that, unlike 

conventional hip replacement systems, 

the Trident system utilizes alumina 

ceramic-on-ceramic bearing surfaces 

rather than metal-on-plastic or metal-onmetal. Alumina ceramic is the hardest 

material next to diamond. The Trident

System is a patented design that 

captures the ceramic insert in a titanium 

sleeve. This design increases the 

strength of the ceramic insert by 50 

percent over other designs. The 

manufacturer stated that the alumina 

ceramic bearing of the device is a 

substantial clinical improvement 

because it is extremely hard and scratch 

resistant, has a low coefficient of 

friction and excellent wear resistance, 

has improved lubrication over metal or 

polyethylene, has no potential for metal 

ion release, and has less alumina 

particle debris. The manufacturer also 

stated that fewer hip revisions are 

needed when this product is used (2.7 

percent of ceramic versus 7.5 percent for 

polyethylene). Stryker stated that the 

ceramic implant also causes less 

osteolysis (or bone loss from particulate 

debris). Due to these improvements over 

traditional hip implants, the 

manufacturer stated the Trident

Ceramic Acetabular System has 

demonstrated significantly lower wear 

versus the conventional plastic/metal 

system in the laboratory; therefore, it is 

anticipated that these improved wear 

characteristics will extend the life of the 

implant. 

The Trident Ceramic Acetabular 

System received FDA approval in 

February 3, 2003. However, this product 

was not available on the market until 

April 2003. The period that technologies 

are eligible to receive new technology 

add-on payment is no less than 2 years 

but not more than 3 years from the point 

the product comes on the market. At 

this point, we begin to collect charges 

reflecting the cost of the device in the 

MedPAR data. Because the device 

became available on the market in April 

2003, charges reflecting the cost of the 

device may have been included in the 

data used to calculate the DRG weights 

in FY 2005 and the proposed DRG 

weights for FY 2006. Therefore, the 

technology may no longer be considered 

new for the purposes of new technology 

add-on payments. For this reason, we 

are proposing to deny add-on payments 

for the Trident Ceramic Acetabular 

System for FY 2006. 

Although we are proposing not to 

approve this application because the 

Trident Ceramic Acetabular System 

does not meet the newness criterion, we 

note that the applicant submitted 

information on the cost and substantial 

clinical improvement criteria. 

The applicant submitted cost 

threshold information for the Trident

Ceramic Acetabular System, stating that 

cases using the system would be 

23366 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

included in DRG 209 (Major Joint and 

Limb Reattachment Procedures of Lower 

Extremity). The manufacturer indicated 

that there is not an ICD–9–CM code 

specific to ceramic hip arthroplasty, but 

it is currently reported using code 81.51 

(Total hip replacement). Of the 

applicable charges for the Trident

Ceramic Acetabular System, only the 

components that the applicant 

identified as new would be eligible for 

new technology add-on payments. The 

estimated cost of the new portions of the 

device, according to the information 

provided in the application, is $6,009. 

The charge threshold for DRG 209 is 

$34,195. The data submitted by Stryker 

Orthopaedics showed an average 

standardized charge, assuming a 28 

percent implant markup, of $34,230. 

Regarding the issue of substantial 

clinical improvement, we recognize that 

the Trident Ceramic Acetabular 

System represents an incremental 

advance in prosthetic hip technology. 

However, we also recognize that there 

are a number of other new prostheses 

available that utilize a variety of bearing 

surface materials that also offer 

increased longevity and decreased wear. 

For this reason, we do not believe that 

the Trident system has demonstrated 

itself to be a clearly superior new 

technology. 

We received the following public 

comments, in accordance with section 

503(b)(2) of Pub. L. 108–173, regarding 

this application for add-on payments. 

Comment: One commenter noted that 

clinical outcomes for the Trident

Ceramic Acetabular System are not a 

significant clinical improvement over 

similar devices on the market. A 

member of the orthopedic community 

noted at the new technology town hall 

meeting that this system is not the only 

new product that promises significantly 

improved results because of 

enhancements to materials and design. 

This commenter suggested that it may 

be inappropriate to recognize only one 

of these new hip replacement products 

for new technology add-on payments. 

Response: We appreciate the 

commenter’s input on this criterion. We 

will consider these comments regarding 

the substantial clinical improvement 

criterion. However, based on the 

observations provided at the town hall 

meeting, we are considering alternative 

methods of recognizing technological 

improvements in this area other than 

approving only one of these new 

technologies for add-on payments. For 

example, as discussed in section 

II.B.6.a. of the preamble to this proposed 

rule, we are proposing to split DRG 209 

to create a new DRG for revisions of hip 

and knee replacements. We would leave 

all other replacements and attachment 

procedures in a separate, new DRG. We 

also stated that we will be reviewing 

these DRGs based on new procedure 

codes that will provide more detailed 

data on the specific nature of the 

revision procedures performed. In 

addition, we are creating new procedure 

codes that will identify the type of 

bearing surface of a hip replacement. As 

we obtain data from these new codes, 

we will consider additional DRG 

revisions to better capture the various 

types of joint procedures. We may 

consider a future restructuring of the 

joint replacement and revision DRGs 

that would better capture the higher 

costs of products that offer greater 

durability, extended life, and improved 

outcomes. In doing so, of course, we 

may need to create additional, more 

precise ICD–9–CM codes. We welcome 

comments on this issue, and generally 

on whether the Trident Ceramic 

Acetabular System meets the criteria to 

qualify for new technology add-on 

payments. 

h. Wingspan TM Stent System with 

Gateway TM PTA Balloon Catheter 

Boston Scientific submitted an 

application for the Wingspan TM Stent 

System with Gateway TM PTA Balloon 

Catheter for new technology add-on 

payments. The device is designed for 

the treatment of patients with 

intracranial atherosclerotic disease who 

suffer from recurrent stroke despite 

medical management. The device 

consists of the following: a selfexpanding nitinol stent, a multilumen 

over the wire delivery catheter, and a 

Gateway PTA Balloon Catheter. The 

device is used to treat stenoses that 

occur in the intracranial vessels. Prior to 

stent placement, the Gateway PTA 

Balloon is inflated to dilate the target 

lesion, and then the stent is deployed 

across the lesion to restore and maintain 

luminal patency. Effective October 1, 

2004, two new ICD–9–CM procedure 

codes were created to code intracranial 

angioplasty and intracranial stenting 

procedures: procedure codes 00.62 

(Percutaneous angioplasty or 

atherectomy of intracranial vessels) and 

00.65 (Percutaneous insertion of 

intracranial vascular stents). 

On January 9, 2004, the FDA 

designated the Wingspan TM as a 

Humanitarian Use Designation (HUD). 

The manufacturer has also applied for 

Humanitarian Device Exemption (HDE) 

status and expects approval from the 

FDA in July 2005. It is important to note 

that currently CMS has a noncoverage 

policy for percutaneous transluminal 

angioplasty to treat lesions of 

intracranial vessels. The applicant is 

working closely with CMS to review 

this decision upon FDA approval. 

Because the device is neither FDAapproved nor Medicare-covered, we do 

not believe it is appropriate to present 

our full analysis on whether the 

technology meets the individual criteria 

for the new technology add-on payment. 

However, we note that the applicant did 

submit the following information below 

on the cost criterion and substantial 

clinical improvement criterion. 

The manufacturer submitted data 

from MedPAR and non-MedPAR 

databases. The non-MedPAR data was 

from the 2003 patient discharge data 

from California’s Office of Statewide 

Health Planning and Development 

database for hospitals in California and 

from the 2003 patient data from 

Florida’s Agency for Health Care 

Administration for hospitals in Florida. 

The applicant identified cases that had 

a diagnosis code of 437.0 (Cerebral 

atherosclerosis), 437.1 (Other 

generalized ischemic cerebrovascular 

disease) or 437.9 (Unspecified) or any 

diagnosis code that begins with the 

prefix of 434 (Occlusion of cerebral 

arteries) in combination with procedure 

code 39.50 (Angioplasty or atherectomy 

of noncoronary vessel) or procedure 

code 39.90 (Insertion of nondrugeluting, noncoronary artery stents). The 

applicant used procedure codes 39.50 

and 39.90 because procedure codes 

00.62 and 00.65 were not available until 

FY 2005. The applicant found cases in 

DRG 5 (Extracranial Vascular 

Procedures) (which previously existed 

under the Medicare IPPS DRG system 

prior to a DRG split) and in DRGs 533 

(Extracranial Procedure with CC) and 

534 (Extracranial Procedure Without 

CC). Even though DRG 5 was split into 

DRGs 533 and 534 in FY 2003, some 

hospitals continued to use DRG 5 for 

non-Medicare cases. The applicant 

found 22 cases that had an intracranial 

PTA with a stent. The average 

(nonstandardized) charge per case was 

$78,363. 

The applicant also submitted data 

from the FY 2002 and FY 2003 MedPAR 

files. Using the latest data from the FY 

2003 MedPAR and the same 

combination of diagnosis and procedure 

codes mentioned above to identify cases 

of intracranial PTA with stenting, the 

applicant found 116 cases in DRG 533 

and 20 cases in DRG 534. The caseweighted average standardized charge 

per case was $51,173. The average caseweighted threshold was $25,394. Based 

on this analysis, the applicant 

maintained that the technology meets 

the cost criteria since the average caseweighted standardized charge per case 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23367 

is greater than the average caseweighted threshold. 

The applicant also maintained that 

the technology meets the substantial 

clinical improvement criterion. 

Currently, there is no available surgical 

or medical treatment for recurrent stroke 

that occurs despite optimal medical 

management. The Wingspan TM is the 

first commercially available PTA/stent 

system designed specifically for the 

intracranial vasculature. However, 

because the Wingspan TM does not have 

FDA approval or Medicare coverage, as 

stated above, we are proposing to deny 

add-on payment for this new 

technology. 

We received no public comments 

regarding this application for add-on 

payments. 

III. Proposed Changes to the Hospital 

Wage Index 

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 statistical areas 

established by the Office of Management 

and Budget (OMB). A discussion of the 

proposed FY 2006 hospital wage index 

based on the statistical areas, including 

OMB’s revised definitions of 

Metropolitan Areas, appears under 

section III.B. of this preamble. 

Beginning October 1, 1993, section 

1886(d)(3)(E) of the Act requires that we 

update the wage index annually. 

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 the earnings and 

paid hours of employment by 

occupational category, and must 

exclude the wages and wage-related 

costs incurred in furnishing skilled 

nursing services. This provision also 

requires us to make any updates or 

adjustments to the wage index in a 

manner that ensures that aggregate 

payments to hospitals are not affected 

by the change in the wage index. The 

proposed adjustment for FY 2006 is 

discussed in section II.B. of the 

Addendum to this proposed rule. 

As discussed below in section III.G. of 

this preamble, we also take into account 

the geographic reclassification of 

hospitals in accordance with sections 

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

when calculating the wage index. Under 

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

Secretary is required to adjust the 

standardized amounts so as to ensure 

that aggregate payments under the IPPS 

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. The proposed budget 

neutrality adjustment for FY 2006 is 

discussed in section II.B. of the 

Addendum to this proposed rule. 

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

provides for the collection of data every 

3 years on the occupational mix of 

employees for short-term, acute care 

hospitals participating in the Medicare 

program, in order to construct an 

occupational mix adjustment to the 

wage index. A discussion of the 

proposed occupational mix adjustment 

that we are proposing to apply 

beginning October 1, 2005 (the proposed 

FY 2006 wage index) appears under 

section III.C. of this preamble. 

B. Core-Based Statistical Areas Used for 

the Proposed Hospital Wage Index 

(If you choose to comment on issues 

in this section, please include the 

caption ‘‘CBSAs’’ at the beginning of 

your comment.) 

The wage index is calculated and 

assigned to hospitals on the basis of the 

labor market area in which the hospital 

is located. In accordance with the broad 

discretion under section 1886(d)(3)(E) of 

the Act, beginning with FY 2005, we 

define hospital labor market areas based 

on the Core-Based Statistical Areas 

(CBSAs) established by OMB and 

announced in December 2003 (69 FR 

49027). OMB defines a CBSA, beginning 

in 2003, as ‘‘a geographic entity 

associated with at least one core of 

10,000 or more population, plus 

adjacent territory that has a high degree 

of social and economic integration with 

the core as measured by commuting 

ties.’’ The standards designate and 

define two categories of CBSAs: 

Metropolitan Statistical Areas (MSAs) 

and Micropolitan Statistical Areas (65 

FR 82235). 

According to OMB, MSAs are based 

on urbanized areas of 50,000 or more 

population, and Micropolitan Statistical 

Areas (referred to in this discussion as 

Micropolitan Areas) are based on urban 

clusters with a population of at least 

10,000 but less than 50,000. Counties 

that do not fall within CBSAs are 

deemed ‘‘Outside CBSAs.’’ In the past, 

OMB defined MSAs around areas with 

a minimum core population of 50,000, 

and smaller areas were ‘‘Outside MSAs.’’

The general concept of the CBSAs is 

that of an area containing a recognized 

population nucleus and adjacent 

communities that have a high degree of 

integration with that nucleus. The 

purpose of the standards is to provide 

nationally consistent definitions for 

collecting, tabulating, and publishing 

Federal statistics for a set of geographic 

areas. CBSAs include adjacent counties 

that have a minimum of 25 percent 

commuting to the central counties of the 

area. (This is an increase over the 

minimum commuting threshold of 15 

percent for outlying counties applied in 

the previous MSA definition.) 

The new CBSAs established by OMB 

comprised MSAs and the new 

Micropolitan Areas based on Census 

2000 data. (A copy of the announcement 

may be obtained at the following 

Internet address: http:// 

www.whitehouse.gov/omb/bulletins/ 

fy04/b04–03.html.) The definitions 

recognize 49 new MSAs and 565 new 

Micropolitan Areas, and extensively 

revised the composition of many of the 

existing MSAs. 

The new area designations resulted in 

a higher wage index for some areas and 

lower wage index for others. Further, 

some hospitals that were previously 

classified as urban are now in rural 

areas. Given the significant payment 

impacts upon some hospitals because of 

these changes, we provided a transition 

period to the new labor market areas in 

the FY 2005 IPPS final rule (69 FR 

49027 through 49034). As part of that 

transition, we allowed urban hospitals 

that became rural under the new 

definitions to maintain their assignment 

to the Metropolitan Statistical Area 

(MSA) where they were previously 

located for the 3-year period of FY 2005, 

FY 2006, and FY 2007. Specifically, 

these hospitals were assigned the wage 

index of the urban area to which they 

previously belonged. (For purposes of 

wage index computation, the wage data 

of these hospitals remained assigned to 

the statewide rural area in which they 

are located.) The hospitals receiving this 

transition will not be considered urban 

hospitals; rather they will maintain their 

status as rural hospitals. Thus, the 

hospital would not be eligible, for 

example, for a large urban add-on 

payment under the capital PPS. In other 

words, it is the wage index, but not the 

urban or rural status, of these hospitals 

that is being affected by this transition. 

The higher wage indices that these 

hospitals are receiving are also being 

taken into consideration in determining 

23368 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

whether they qualify for the outcommuting adjustment discussed in 

section III.I. of this preamble and the 

amount of any adjustment. 

FY 2006 will be the second year of 

this transition period. We will continue 

to assign the wage index for the urban 

area in which the hospital was 

previously located through FY 2007. In 

order to ensure this provision remains 

budget neutral, we will continue to 

adjust the standardized amount by a 

transition budget neutrality factor to 

account for these hospitals. Doing so is 

consistent with the requirement of 

section 1886(d)(3)(E) of the Act that any 

‘‘adjustments or updates [to the 

adjustment for different area wage 

levels] * * * shall be made in a manner 

that assures that aggregate payments 

* * * are not greater or less than those 

that would have been made in the year 

without such adjustment.’’

Beginning in FY 2008, these hospitals 

will receive their statewide rural wage 

index, although they will be eligible to 

apply for reclassification by the 

MGCRB, both during this transition 

period as well as in subsequent years. 

In addition, in the FY 2005 IPPS final 

rule (69 FR 49032 through 49033), we 

provided a 1-year transition blend for 

hospitals that, due solely to the changes 

in the labor market definitions, 

experienced a decrease in their FY 2005 

wage index compared to the wage index 

they would have received using the 

labor market areas included in 

calculating their FY 2004 wage index. 

Hospitals that experienced a decrease in 

their wage index as a result of adoption 

of the new labor market area changes 

received a wage index based on 50 

percent of the CBSA labor market area 

definitions and 50 percent of the wage 

index that the provider would have 

received under the FY 2004 MSA 

boundaries (in both cases using the FY 

2001 wage data). This blend applied to 

any provider experiencing a decrease 

due to the new definitions, including 

providers who were reclassifying under 

MGCRB requirements, section 

1886(d)(8)(B) of the Act, or section 508 

of Pub. L. 108–173. In the FY 2005 IPPS 

final rule (69 FR 49027 through 49033), 

we described the determination of this 

blend in detail. We noted that this blend 

would not prevent a decrease in wage 

index due to any reason other than 

adoption of CBSAs, nor did it apply to 

hospitals that benefited from a higher 

wage index due to the new labor market 

definitions. 

Consistent with the FY 2005 IPPS 

final rule, we are proposing that 

hospitals receive 100 percent of their 

wage index based upon the new CBSA 

configurations beginning in FY 2006. 

Specifically, we will determine for each 

hospital a new wage index employing 

wage index data from FY 2002 hospital 

cost reports and using the CBSA labor 

market definitions. 

C. Proposed Occupational Mix 

Adjustment to FY 2006 Index 

(If you choose to comment on issues 

in this section, please include the 

caption ‘‘Occupational Mix Adjustment’’

at the beginning of your comment.) 

As stated earlier, section 1886(d)(3)(E) 

of the Act provides for the collection of 

data every 3 years on the occupational 

mix of employees for each short-term, 

acute care hospital participating in the 

Medicare program, in order to construct 

an occupational mix adjustment to the 

wage index, for application beginning 

October 1, 2004 (the FY 2005 wage 

index). The purpose of the occupational 

mix adjustment is to control for the 

effect of hospitals’ employment choices 

on the wage index. For example, 

hospitals may choose to employ 

different combinations of registered 

nurses, licensed practical nurses, 

nursing aides, and medical assistants for 

the purpose of providing nursing care to 

their patients. The varying labor costs 

associated with these choices reflect 

hospital management decisions rather 

than geographic differences in the costs 

of labor. 

1. Development of Data for the Proposed 

Occupational Mix Adjustment 

In the FY 2005 IPPS final rule (69 FR 

49034), we discussed in detail the data 

we used to calculate the occupational 

mix adjustment to the FY 2005 wage 

index. For the FY 2006 wage index, we 

are proposing to use the same CMS 

Wage Index Occupational Mix Survey 

and Bureau of Labor Statistics (BLS) 

data that we used for the FY 2005 wage 

index, with two exceptions. The CMS 

survey requires hospitals to report the 

number of total paid hours for directly 

hired and contract employees in 

occupations that provide the following 

services: nursing, physical therapy, 

occupational therapy, respiratory 

therapy, medical and clinical laboratory, 

dietary, and pharmacy. These services 

each include several standard 

occupational classifications (SOCs), as 

defined by the BLS’ Occupational 

Employment Statistics (OES) survey. 

For the proposed FY 2006 wage index, 

we used revised survey data for 20 

hospitals that took advantage of the 

opportunity we afforded hospitals to 

submit changes to their occupational 

mix data during the FY 2006 wage index 

data collection process (see discussion 

of wage data corrections process under 

section III.J. of this preamble). We also 

excluded survey data for hospitals that 

became designated as CAHs since the 

original survey data were collected and 

hospitals for which there are no 

corresponding cost report data for the 

proposed FY 2006 wage index. The 

proposed FY 2006 wage index includes 

occupational mix data from 3,563 out of 

3,765 hospitals (94.6 percent response 

rate). The results of the occupational 

mix survey are included in the chart 

below: 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23369 


EP04my05.026</GPH>
23370 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

2. Calculation of the Proposed FY 2006 

Occupational Mix Adjustment Factor 

and the Proposed FY 2006 Occupational 

Mix Adjusted Wage Index 

For the proposed FY 2006 wage 

index, we are proposing to use the same 

methodology that we used to calculate 

the occupational mix adjustment to the 

FY 2005 wage index (69 FR 49042). We 

are proposing to use the following steps 

for calculating the proposed FY 2006 

occupational mix adjustment factor and 

the occupational mix adjusted wage 

index: 

Step 1—For each hospital, the 

percentage of the general service 

category attributable to an SOC is 

determined by dividing the SOC hours 

by the general service category’s total 

hours. Repeat this calculation for each 

of the 19 SOCs. 

Step 2—For each hospital, the 

weighted average hourly rate for an SOC 

is determined by multiplying the 

percentage of the general service 

category (from Step 1) by the national 

average hourly rate for that SOC from 

the 2001 BLS OES survey, which was 

used in calculating the occupational 

mix adjustment for the FY 2005 wage 

index. The 2001 OES survey is BLS’

latest available hospital-specific survey. 

(See Chart 4 in the FY 2005 IPPS final 

rule, 69 FR 49038.) Repeat this 

calculation for each of the 19 SOCs. 

Step 3—For each hospital, the 

hospital’s adjusted average hourly rate 

for a general service category is 

computed by summing the weighted 

hourly rate for each SOC within the 

general category. Repeat this calculation 

for each of the 7 general service 

categories. 

Step 4—For each hospital, the 

occupational mix adjustment factor for 

a general service category is calculated 

by dividing the national adjusted 

average hourly rate for the category by 

the hospital’s adjusted average hourly 

rate for the category. (The national 

adjusted average hourly rate is 

computed in the same manner as Steps 

1 through 3, using instead, the total SOC 

and general service category hours for 

all hospitals in the occupational mix 

survey database.) Repeat this calculation 

for each of the 7 general service 

categories. If the hospital’s adjusted rate 

is less than the national adjusted rate 

(indicating the hospital employs a less 

costly mix of employees within the 

category), the occupational mix 

adjustment factor will be greater than 

1.0000. If the hospital’s adjusted rate is 

greater than the national adjusted rate, 

the occupational mix adjustment factor 

will be less than 1.0000. 

Step 5—For each hospital, the 

occupational mix adjusted salaries and 

wage-related costs for a general service 

category is calculated by multiplying 

the hospital’s total salaries and wagerelated costs (from Step 5 of the 

unadjusted wage index calculation in 

section F) by the percentage of the 

hospital’s total workers attributable to 

the general service category and by the 

general service category’s occupational 

mix adjustment factor (from Step 4 

above). Repeat this calculation for each 

of the 7 general service categories. The 

remaining portion of the hospital’s total 

salaries and wage-related costs that is 

attributable to all other employees of the 

hospital is not adjusted for occupational 

mix. 

Step 6—For each hospital, the total 

occupational mix adjusted salaries and 

wage-related costs for a hospital are 

calculated by summing the occupational 

mix adjusted salaries and wage-related 

costs for the 7 general service categories 

(from Step 5) and the unadjusted 

portion of the hospital’s salaries and 

wage-related costs for all other 

employees. To compute a hospital’s 

occupational mix adjusted average 

hourly wage, divide the hospital’s total 

occupational mix adjusted salaries and 

wage-related costs by the hospital’s total 

hours (from Step 4 of the unadjusted 

wage index calculation in Section F). 

Step 7—To compute the occupational 

mix adjusted average hourly wage for an 

urban or rural area, sum the total 

occupational mix adjusted salaries and 

wage-related costs for all hospitals in 

the area, then sum the total hours for all 

hospitals in the area. Next, divide the 

area’s occupational mix adjusted 

salaries and wage-related costs by the 

area’s hours. 

Step 8—To compute the national 

occupational mix adjusted average 

hourly wage, sum the total occupational 

mix adjusted salaries and wage-related 

costs for all hospitals in the nation, then 

sum the total hours for all hospitals in 

the nation. Next, divide the national 

occupational mix adjusted salaries and 

wage-related costs by the national 

hours. The proposed national 

occupational mix adjusted average 

hourly wage for FY 2006 is $27.9988. 

Step 9—To compute the occupational 

mix adjusted wage index, divide each 

area’s occupational mix adjusted 

average hourly wage (Step 7) by the 

national occupational mix adjusted 

average hourly wage (Step 8). 

Step 10—To compute the Puerto Rico 

specific occupational mix adjusted wage 

index, follow the Steps 1 through 9 

above. The proposed Puerto Rico 

occupational mix adjusted average 

hourly wage for FY 2006 is $12.9875. 

An example of the occupational mix 

adjustment was included in the FY 2005 

IPPS final rule (69 FR 49043). 

For the FY 2005 final wage index, we 

used the unadjusted wage data for 

hospitals that did not submit 

occupational mix survey data. For 

calculation purposes, this equates to 

applying the national SOC mix to the 

wage data for these hospitals, because 

hospitals having the same mix as the 

Nation would have an occupational mix 

adjustment factor equaling 1.0000. In 

the FY 2005 IPPS final rule (69 FF 

49035), we noted that we would revisit 

this matter with subsequent collections 

of the occupational mix data. Because 

we are using essentially the same survey 

data for the proposed FY 2006 

occupational mix adjustment that we 

used for FY 2005, with the only 

exceptions as stated in section III.C.1. of 

this preamble, we are proposing to treat 

the wage data for hospitals that did not 

respond to the survey in this same 

manner for the proposed FY 2006 wage 

index. 

In implementing an occupational mix 

adjusted wage index based on the above 

calculation, the proposed wage index 

values for 14 rural areas (29.8 percent) 

and 206 urban areas (53.5 percent) 

would decrease as a result of the 

adjustment. Six (6) rural areas (12.8 

percent) and 111 urban areas (28.8 

percent) would experience a decrease of 

1 percent or greater in their wage index 

values. The largest negative impact for 

a rural area would be 1.9 percent and for 

an urban area, 4.3 percent. Meanwhile, 

33 rural areas (70.2 percent) and 179 

urban areas (46.5 percent) would 

experience an increase in their wage 

index values. Although these results 

show that rural hospitals would gain the 

most from an occupational mix 

adjustment to the wage index, their 

gains may not be as great as might have 

been expected. Further, it might not 

have been anticipated that almost onethird of rural hospitals would actually 

fare worse under the adjustment. 

Overall, a fully implemented 

occupational mix adjusted wage index 

would have a redistributive effect on 

Medicare payments to hospitals. 

In the FY 2005 IPPS, we indicated 

that, for future data collections, we 

would revise the occupational mix 

survey to allow hospitals to provide 

both salaries and hours data for each of 

the employment categories that are 

included on the survey. We also 

indicated that we would assess whether 

future occupational mix surveys should 

be based on the calendar year or if the 

data should be collected on a fiscal year 

basis as part of the Medicare cost report. 

(One logistical problem is that cost 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23371 

report data are collected yearly, but 

occupational mix survey data are 

collected only every 3 years.) We are 

currently reviewing options for revising 

the occupational mix survey and 

improving the data collection process. 

We will publish any changes we make 

to the occupational mix survey in a 

Federal Register notice. 

In our continuing efforts to meet the 

information needs of the public, we are 

providing three additional public use 

files for the proposed occupational mix 

adjusted wage index: (1) A file 

including each hospital’s unadjusted 

and adjusted average hourly wage (FY 

2006 Proposed Rule Occupational Mix 

Adjusted and Unadjusted Average 

Hourly Wage by Provider); (2) a file 

including each CBSA’s adjusted and 

unadjusted average hourly wage (FY 

2006 Proposed Rule Occupational Mix 

Adjusted and Unadjusted Average 

Hourly Wage and Pre-Reclassified Wage 

Index by CBSA); and (3) a file including 

each hospital’s occupational mix 

adjustment factors by occupational 

category (Provider Occupational Mix 

Adjustment Factors for Each 

Occupational Category). These 

additional files are being released 

concurrently with the publication of 

this proposed rule and are posted on the 

Internet, at http://www.cms.hhs.gov/ 

providers/hipps/ippswage.asp. We will 

also post these files with future 

applications of the occupational mix 

adjustment. 

D. Worksheet S–3 Wage Data for the 

Proposed FY 2006 Wage Index Update 

(If you choose to comment on issues 

in this section, please include the 

caption ‘‘Wage Data’’ at the beginning of 

your comment.) 

The proposed FY 2006 wage index 

values (effective for hospital discharges 

occurring on or after October 1, 2005 

and before October 1, 2006) in section 

VI. of the Addendum to this proposed 

rule are based on the data collected from 

the Medicare cost reports submitted by 

hospitals for cost reporting periods 

beginning in FY 2002 (the FY 2005 wage 

index was based on FY 2001 wage data). 

The proposed FY 2006 wage index 

includes the following categories of data 

associated with costs paid under the 

IPPS (as well as outpatient costs): 

• Salaries and hours from short-term, 

acute care hospitals (including paid 

lunch hours and hours associated with 

military leave and jury duty). 

• Home office costs and hours. 

• Certain contract labor costs and 

hours (which includes direct patient 

care, certain top management, 

pharmacy, laboratory, and nonteaching 

physician Part A services). 

• Wage-related costs, including 

pensions and other deferred 

compensation costs. 

The September 1, 1994 Federal 

Register (59 FR 45356) included a list of 

core wage-related costs that are 

included in the wage index, and 

discussed criteria for including other 

wage-related costs. In that discussion, 

we instructed hospitals to use generally 

accepted accounting principles (GAAPs) 

in developing wage-related costs for the 

wage index for cost reporting periods 

beginning on or after October 1, 1994. 

We discussed our rationale that ‘‘the 

application of GAAPs for purposes of 

compiling data on wage-related costs 

used to construct the wage index will 

more accurately reflect relative labor 

costs, because certain wage-related costs 

(such as pension costs), as recorded 

under GAAPs, tend to be more static 

from year to year.’’

Since publication of the September 1, 

1994 rule, we have periodically received 

inquiries for more specific guidance on 

developing wage-related costs for the 

wage index. In response, we have 

provided clarifications in the IPPS rules 

(for example, health insurance costs (66 

FR 39859)) and in the cost report 

instructions (Provider Reimbursement 

Manual (PRM), Part II, Section 3605.2). 

Due to recent questions and concerns 

we received regarding inconsistent 

reporting and overreporting of pension 

and other deferred compensation plan 

costs, as a result of an ongoing Office of 

Inspector General review, we are 

clarifying in this proposed rule that 

hospitals must comply with the PRM, 

Part I, sections 2140. 2141, and 2142 

and related Medicare program 

instructions for developing pension and 

other deferred compensation plan costs 

as wage-related costs for the wage index. 

The Medicare instructions for pension 

costs and other deferred compensation 

costs combine GAAPs, Medicare 

payment principles, and other Federal 

labor requirements. We believe that the 

Medicare instructions allow for 

consistent reporting among hospitals 

and for the development of reasonable 

deferred compensation plan costs for 

purposes of the wage index. 

Beginning with the FY 2007 wage 

index, hospitals and fiscal 

intermediaries must ensure that 

pension, post-retirement health benefits, 

and other deferred compensation plan 

costs for the wage index are developed 

according to the above terms. 

Consistent with the wage index 

methodology for FY 2005, the proposed 

wage index for FY 2006 also excludes 

the direct and overhead salaries and 

hours for services not subject to IPPS 

payment, such as SNF services, home 

health services, costs related to GME 

(teaching physicians and residents) and 

certified registered nurse anesthetists 

(CRNAs), and other subprovider 

components that are not paid under the 

IPPS. The proposed FY 2006 wage index 

also excludes the salaries, hours, and 

wage-related costs of hospital-based 

rural health clinics (RHCs), and 

Federally qualified health centers 

(FQHCs) because Medicare pays for 

these costs outside of the IPPS (68 FR 

45395). In addition, salaries, hours and 

wage-related costs of CAHs are excluded 

from the wage index, for the reasons 

explained in the FY 2004 IPPS final rule 

(68 FR 45397). 

Data collected for the IPPS wage 

index are also currently used to 

calculate wage indices applicable to 

other providers, such as SNFs, home 

health agencies, and hospices. In 

addition, they are used for prospective 

payments to rehabilitation, psychiatric, 

and long-term care hospitals, and for 

hospital outpatient services. 

In the August 11, 2004 final rule, we 

stated that a commenter had asked CMS 

to designate provider-based clinics as 

IPPS-excluded areas in order to remove 

the costs from the wage index (69 FR 

49049). The commenter noted that 

provider-based clinics are like physician 

private offices, which are excluded from 

the wage index calculation, and that 

services provided in the provider-based 

clinics are paid for not through the 

IPPS, but rather under the hospital 

outpatient PPS. In response to the 

comment, we stated that we were not 

prepared to grant the commenter’s 

request without first studying the issue, 

and that we would explore the matter of 

salaries related to provider-based clinics 

in a future rule. 

Regulations at 42 CFR 413.65 describe 

the criteria and procedures for 

determining whether a facility or 

organization is provider-based. 

Historically, under the Medicare 

program, some providers, referred to as 

‘‘main providers,’’ have functioned as 

single entities while owning and 

operating multiple provider-based 

departments, locations, and facilities 

that are treated as part of the main 

provider for Medicare purposes. Section 

413.65(a)(2) defines various types of 

provider-based facilities, including 

‘‘department of a provider.’’ A 

‘‘department of a provider’’ means a 

facility or organization that is either 

created by, or acquired by, a main 

provider for the purposes of furnishing 

health care services of the same type as 

those furnished by the main provider 

under the name, ownership, and 

financial and administrative control of 

the main provider * * * a department 

23372 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

of a provider may not itself be qualified 

to participate in Medicare as a provider 

under § 489.2 * * * the term 

‘department of a provider’ does not 

include an RHC or * * * an FQHC.’’

Thus, if a facility offers services that are 

similar to those provided in a 

freestanding physician’s office, and the 

facility meets the criteria to become 

provider-based under § 413.65, the 

facility would be considered a 

‘‘department of a provider.’’ More 

specifically, the facility would be part of 

the main provider’s outpatient 

department, since the facility offers 

health care services of the same type as 

those furnished by the main provider, 

and because a physician’s office would 

not be subject to a provider agreement 

or receive a Medicare provider number 

under § 489.2. (We note that a providerbased RHC or FQHC may, by itself, be 

qualified to participate in Medicare as a 

provider under § 489.2 and, thus, would 

be classified not as a ‘‘department of a 

provider’’ but as a ‘‘provider-based 

entity,’’ as defined at § 413.65(a)(2)). 

This provider-based facility, or 

provider-based clinic, as the commenter 

referred to it, would be reported on the 

main provider’s Medicare cost report as 

an outpatient service cost center, on 

Worksheet A, line 60. With the 

exception of RHC and FQHC salaries 

that have been excluded from the wage 

index beginning with FY 2004 (68 FR 

45395, August 1, 2003), the salaries 

attributable to employees working in 

these outpatient service cost centers, 

including emergency departments, are 

included in the main provider’s total 

salaries on Worksheet S–3, Part II, line 

1, and accordingly, are included in the 

wage index calculation. We have 

historically included the salaries and 

wages of hospital employees working in 

the outpatient departments in the 

calculation of the hospital wage index 

since these employees often work in 

both the IPPS and in the outpatient 

areas of the hospital. Consistent with 

this longstanding treatment of 

outpatient salary costs in the wage 

index calculation, we believe it is 

appropriate to continue to include the 

salaries and wages of employees 

working in outpatient departments, 

including provider-based clinics, in the 

wage index calculation. 

E. Verification of Worksheet S–3 Wage 

Data 

(If you choose to comment on issues 

in this section, please include the 

caption ‘‘Wage Data’’ at the beginning of 

your comment.) 

The wage data for the proposed FY 

2006 wage index were obtained from 

Worksheet S–3, Parts II and III of the FY 

2002 Medicare cost reports. Instructions 

for completing the Worksheet S–3, Parts 

II and III are in the Provider 

Reimbursement Manual, Part I, sections 

3605.2 and 3605.3. The data file used to 

construct the proposed wage index 

includes FY 2002 data submitted to us 

as of February 23, 2005. As in past 

years, we performed an intensive review 

of the wage data, mostly through the use 

of edits designed to identify aberrant 

data. 

We asked our fiscal intermediaries to 

revise or verify data elements that 

resulted in specific edit failures. Some 

unresolved data elements are included 

in the calculation of the proposed FY 

2006 wage index, pending their 

resolution before calculation of the final 

FY 2006 index. We instructed the fiscal 

intermediaries to complete their data 

verification of questionable data 

elements and to transmit any changes to 

the wage data no later than April 15, 

2005. We believe all unresolved data 

elements will be resolved by the date 

the final rule is issued. The revised data 

will be reflected in the final rule. 

Also, as part of our editing process, 

we removed the data for 438 hospitals 

from our database: 402 hospitals became 

CAHs by the time we published the 

February public use file, and 28 

hospitals were low Medicare utilization 

hospitals or failed edits that could not 

be corrected because the hospitals 

terminated the program or changed 

ownership. In addition, we removed the 

wage data for 8 hospitals with 

incomplete or inaccurate data resulting 

in zero or negative, or otherwise 

aberrant, average hourly wages. We have 

notified the fiscal intermediaries of 

these hospitals and will continue to 

work with the fiscal intermediaries to 

correct these data until we finalize our 

database to compute the final wage 

index. The data for these hospitals will 

be included in the final wage index if 

we receive corrected data that passes 

our edits. As a result, the proposed FY 

2006 wage index is calculated based on 

FY 2002 wage data from 3,765 hospitals. 

In constructing the proposed FY 2006 

wage index, we include the wage data 

for facilities that were IPPS hospitals in 

FY 2002, even for those facilities that 

have since terminated their 

participation in the program as 

hospitals, as long as those data do not 

fail any of our edits for reasonableness. 

We believe that including the wage data 

for these hospitals is, in general, 

appropriate to reflect the economic 

conditions in the various labor market 

areas during the relevant past period. 

However, we exclude the wage data for 

CAHs (as discussed in 68 FR 45397). 

The proposed wage index in this 

proposed rule excludes hospitals that 

are designated as CAHs by February 1, 

2005, the date of the latest available 

Medicare CAH listing at the time we 

released the proposed wage index 

public use file on February 25, 2005. 

F. Computation of the Proposed FY 

2006 Unadjusted Wage Index 

(If you choose to comment on issues 

in this section, please include the 

caption ‘‘Wage Index’’ at the beginning 

of your comment.) 

The method used to compute the 

proposed FY 2006 wage index without 

an occupational mix adjustment 

follows: 

Step 1—As noted above, we based the 

proposed FY 2006 wage index on wage 

data reported on the FY 2002 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, Parts II 

and III of the Medicare cost report for 

the hospital’s cost reporting period 

beginning on or after October 1, 2001 

and before October 1, 2002. In addition, 

we included data from some hospitals 

that had cost reporting periods 

beginning before October 2001 and 

reported a cost reporting period 

covering all of FY 2002. These data were 

included because no other data from 

these hospitals would be available for 

the cost reporting period described 

above, and because particular labor 

market areas might be affected due to 

the omission of these hospitals. 

However, we generally describe these 

wage data as FY 2002 data. We note 

that, if a hospital had more than one 

cost reporting period beginning during 

FY 2002 (for example, a hospital had 

two short cost reporting periods 

beginning on or after October 1, 2001 

and before October 1, 2002), we 

included wage data from only one of the 

cost reporting periods, the longer, in the 

wage index calculation. If there was 

more than one cost reporting period and 

the periods were equal in length, we 

included the wage data from the later 

period in the wage index calculation. 

Step 2—Salaries—The method used 

to compute a hospital’s average hourly 

wage excludes certain costs that are not 

paid under the IPPS. In calculating a 

hospital’s average salaries plus wagerelated costs, we subtracted from Line 1 

(total salaries) the GME and CRNA costs 

reported on Lines 2, 4.01, 6, and 6.01, 

the Part B salaries reported on Lines 3, 

5 and 5.01, home office salaries reported 

on Line 7, and excluded salaries 

reported on Lines 8 and 8.01 (that is, 

direct salaries attributable to SNF 

services, home health services, and 

other subprovider components not 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23373 

subject to the IPPS). We also subtracted 

from Line 1 the salaries for which no 

hours were reported. To determine total 

salaries plus wage-related costs, we 

added to the net hospital salaries the 

costs of contract labor for direct patient 

care, certain top management, 

pharmacy, laboratory, and nonteaching 

physician Part A services (Lines 9 and 

10), home office salaries and wagerelated costs reported by the hospital on 

Lines 11 and 12, and nonexcluded area 

wage-related costs (Lines 13, 14, and 

18). 

We note that contract labor and home 

office salaries for which no 

corresponding hours are reported were 

not included. In addition, wage-related 

costs for nonteaching physician Part A 

employees (Line 18) are excluded if no 

corresponding salaries are reported for 

those employees on Line 4. 

Step 3—Hours—With the exception of 

wage-related costs, for which there are 

no associated hours, we computed total 

hours using the same methods as 

described for salaries in Step 2. 

Step 4—For each hospital reporting 

both total overhead salaries and total 

overhead hours greater than zero, we 

then allocated overhead costs to areas of 

the hospital excluded from the wage 

index calculation. First, we determined 

the ratio of excluded area hours (sum of 

Lines 8 and 8.01 of Worksheet S–3, Part 

II) to revised total hours (Line 1 minus 

the sum of Part II, Lines 2, 3, 4.01, 5, 

5.01, 6, 6.01, 7, and Part III, Line 13 of 

Worksheet S–3). We then computed the 

amounts of overhead salaries and hours 

to be allocated to excluded areas by 

multiplying the above ratio by the total 

overhead salaries and hours reported on 

Line 13 of Worksheet S–3, Part III. Next, 

we computed the amounts of overhead 

wage-related costs to be allocated to 

excluded areas using three steps: (1) We 

determined the ratio of overhead hours 

(Part III, Line 13) to revised hours (Line 

1 minus the sum of Lines 2, 3, 4.01, 5, 

5.01, 6, 6.01, 7, 8, and 8.01); (2) we 

computed overhead wage-related costs 

by multiplying the overhead hours ratio 

by wage-related costs reported on Part 

II, Lines 13, 14, and 18; and (3) we 

multiplied the computed overhead 

wage-related costs by the above 

excluded area hours ratio. Finally, we 

subtracted the computed overhead 

salaries, wage-related costs, and hours 

associated with excluded areas from the 

total salaries (plus wage-related costs) 

and hours derived in Steps 2 and 3. 

Step 5—For each hospital, we 

adjusted the total salaries plus wagerelated costs to a common period to 

determine total adjusted salaries plus 

wage-related costs. To make the wage 

adjustment, we estimated the percentage 

change in the employment cost index 

(ECI) for compensation for each 30-day 

increment from October 14, 2001 

through April 15, 2003 for private 

industry hospital workers from the 

Bureau of Labor Statistics’

Compensation and Working Conditions. 

We use the ECI because it reflects the 

price increase associated with total 

compensation (salaries plus fringes) 

rather than just the increase in salaries. 

In addition, the ECI includes managers 

as well as other hospital workers. This 

methodology to compute the monthly 

update factors uses actual quarterly ECI 

data and assures that the update factors 

match the actual quarterly and annual 

percent changes. The factors used to 

adjust the hospital’s data were based on 

the midpoint of the cost reporting 

period, as indicated below. 

23374 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

For example, the midpoint of a cost 

reporting period beginning January 1, 

2002 and ending December 31, 2002 is 

June 30, 2002. An adjustment factor of 

1.03083 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 began in FY 

2002 and covered a period of less than 

360 days or more than 370 days, we 

annualized the data to reflect a 1-year 

cost report. Dividing the data by the 

number of days in the cost report and 

then multiplying the results by 365 

accomplishes annualization. 

Step 6—Each hospital was assigned to 

its appropriate urban or rural labor 

market area before any reclassifications 

under section 1886(d)(8)(B), section 

1886(d)(8)(E), or section 1886(d)(10) of 

the Act. Within each urban or rural 

labor market area, we added the total 

adjusted salaries plus wage-related costs 

obtained in Step 5 for all hospitals in 

that area to determine the total adjusted 

salaries plus wage-related costs for the 

labor market area. 

Step 7—We divided the total adjusted 

salaries plus wage-related costs obtained 

under both methods in Step 6 by the 

sum of the corresponding 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 wage-related costs obtained 

in Step 5 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 proposed national average hourly 

wage is $27.9730. 

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. (The national 

Puerto Rico standardized amount is 

adjusted by a wage index calculated for 

all Puerto Rico labor market areas based 

on the national average hourly wage as 

described above.) We added the total 

adjusted salaries plus wage-related costs 

(as calculated in Step 5) 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 proposed average hourly wage of 

$12.9957 for Puerto Rico. For each labor 

market area in Puerto Rico, we 

calculated the Puerto Rico-specific wage 

index value by dividing the area average 

hourly wage (as calculated in Step 7) by 

the overall Puerto Rico average hourly 

wage. 


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Step 11—Section 4410 of Pub. L. 105–

33 provides that, for discharges on or 

after October 1, 1997, the area wage 

index applicable to any hospital that is 

located in an urban area of a State may 

not be less than the area wage index 

applicable to hospitals located in rural 

areas in that State. Furthermore, this 

wage index floor is to be implemented 

in such a manner as to ensure that 

aggregate IPPS payments are not greater 

or less than those that would have been 

made in the year if this section did not 

apply. For FY 2006, this change affects 

147 hospitals in 52 urban areas. The 

areas affected by this provision are 

identified by a footnote in Table 4A in 

the Addendum of this proposed rule. 

G. Computation of the Proposed FY 

2006 Blended Wage Index 

(If you choose to comment on issues 

in this section, please include the 

caption ‘‘Blended Wage Index’’ at the 

beginning of your comments.) 

For the final FY 2005 wage index, we 

used a blend of the occupational mix 

adjusted wage index and the unadjusted 

wage index. Specifically, we adjusted 10 

percent of the FY 2005 wage index 

adjustment factor by a factor reflecting 

occupational mix. Given that 2003–2004 

was the first time for the administration 

of the occupational mix survey, 

hospitals had a short timeframe for 

collecting their occupational mix survey 

data and documentation, the wage data 

were not in all cases from a 1-year 

period, and there was no baseline data 

for purposes of developing a desk 

review program, we found it prudent 

not to adjust the entire wage index 

factor by the occupational mix. 

However, we did find the data 

sufficiently reliable for applying an 

adjustment to 10 percent of the wage 

index. We found the data reliable 

because hospitals were given an 

opportunity to review their survey data 

and submit changes in the Spring of 

2004, hospitals were already familiar 

with the BLS OES survey categories, 

hospitals were required to be able to 

provide documentation that could be 

used by fiscal intermediaries to verify 

survey data, and the results of our 

survey were consistent with the findings 

of the 2001 BLS OES survey, especially 

for nursing and physical therapy 

categories. In addition, we noted that we 

were moving cautiously with 

implementing the occupational mix 

adjustment in recognition of changing 

trends in hiring nurses, the largest group 

in the survey. We noted that some States 

had recently established floors on the 

minimum level of registered nurse 

staffing in hospitals in order to maintain 

licensure. In addition, in some rural 

areas, we believed that hospitals might 

be accounting for shortages of 

physicians by hiring more registered 

nurses. (A complete discussion of the 

FY 2005 wage index adjustment factor 

can be found in section III.G. of the FY 

2005 IPPS final rule (69 FR 49052)). 

In the FY 2005 final rule, we noted 

that while the statute required us to 

collect occupational mix data every 3 

years, the statute does not specify how 

the occupational mix adjustment is to be 

constructed or applied. We are 

clarifying in this proposed rule that the 

October 1, 2004 deadline for 

implementing an occupational mix 

adjustment is not codified in section 

1886(d)(3)(E) of the Act, which requires 

only a collection and measurement of 

occupational mix data, but rather stems 

from the effective date provisions in 

section 304(c) of the Medicare, 

Medicaid and SCHIP Benefits 

Improvement and Protection Act of 

2000, Pub. L. 106–554 (BIPA). Although 

we believe that applying the 

occupational mix to 10 percent of the 

wage index factor fully implements the 

occupational mix adjustment, we also 

interpret BIPA as requiring only that we 

begin applying an adjustment by 

October 1, 2004. BIPA required the 

Secretary to complete, ‘‘by not later than 

September 30, 2003, for application 

beginning October 1, 2004,’’ both the 

collection of occupational mix data and 

the measurement of such data. (BIPA, 

section 304(c)(3).) Thus, even if 

adjusting 10 percent of the wage index 

for occupational mix were not (as we 

believe it to be) considered to be full 

implementation of the BIPA effective 

date, we certainly began our application 

of the adjustment as of October 1, 2004. 

In addition, section 1886(d)(3)(E) of 

the Act provides broad authority for us 

to establish the factor we use to adjust 

hospital costs to take into account area 

differences in wage levels. The statute is 

clear that the wage index factor is to be 

‘‘established by the Secretary.’’ The 

occupational mix is only one part of this 

wage index factor, which, for the most 

part, is calculated on the basis of 

average hourly wage data submitted by 

all hospitals in the United States. In 

exercising the Secretary’s broad 

discretion to establish the factor that 

adjusts for geographic wage differences, 

in FY 2005 we adjusted 10 percent of 

such factor to account for occupational 

mix. 

Indeed, we have often used 

percentage figures or blended amounts 

in exercising the Secretary’s authority to 

establish the factor that adjusts for wage 

differences. For example, in the FY 2005 

final rule, we implemented new 

mapping boundaries for assigning 

hospitals to the geographic labor market 

areas used for calculating the wage 

index. For hospitals that were harmed 

by the new geographic boundaries, we 

used a blended rate based on 50 percent 

of the wage index that would apply 

using the new geographic boundaries 

effective for FY 2005 and 50 percent of 

the wage index that would apply using 

the old geographic boundaries that were 

effective during FY 2004 (69 FR 49033). 

Similarly, beginning with FY 2000, we 

began phasing out costs related to GME 

and CRNAs from the wage index (64 FR 

41505). Thus, for example, the FY 2001 

wage index was based on a blend of 60 

percent of an average hourly wage 

including these costs, and 40 percent of 

an average hourly wage excluding these 

costs (65 FR 47071). 

For FY 2006, we are again proposing 

to adjust 10 percent of the wage index 

factor for occupational mix. In 

computing the occupational mix 

adjustment for the proposed FY 2006 

wage index, we used the occupational 

mix survey data that we collected for 

the FY 2005 wage index, replacing the 

survey data for 20 hospitals that 

submitted revised data, and excluding 

the survey data for hospitals with no 

corresponding Worksheet S–3 wage data 

for FY 2006 wage index. While we 

considered adjusting 100 percent of the 

wage index by the occupational mix, we 

did not believe it was appropriate to use 

first-year survey data to make such a 

large adjustment. As hospitals gain 

additional experience with the 

occupational mix survey, and as we 

develop more information upon which 

to audit the data we receive, we expect 

to increase the portion of the wage 

index that is adjusted. 

We also acknowledge the District 

Court opinion in Bellevue Hospital 

Center v. Leavitt, No. 04–8639 (S.D.N.Y, 

March 2005) finding that the statute 

requires full implementation of the 

occupational mix adjustment beginning 

October 1, 2004, and granting summary 

judgment to plaintiffs on the matter. At 

the time this proposed rule was written, 

an appeal had not yet been heard in the 

Circuit Court. Thus, because it was not 

yet clear whether the decision would be 

appealed, we determined that, for FY 

2006, we would continue to propose the 

policy we believe to be most prudent in 

light of the survey data being used to 

adjust the wage index. 

With 10 percent of the proposed FY 

2006 wage index adjusted for 

occupational mix, the wage index 

values for 13 rural areas (27.7 percent) 

and 204 urban areas (53.0 percent) 

would decrease as a result of the 

adjustment. These decreases would be 

minimal; the largest negative impact for 

23376 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

3Although section 1886(d)(8)(C)(iv)(I) of the Act 

also provides that the wage index for an urban area 

may not decrease as a result of redesignated 

hospitals if the urban area wage index is already 

below the wage index for rural areas in the State 

in which the urban area is located, the provision 

was effectively made moot by section 4410 of Pub. 

L. 105–33, which provides that the area wage index 

applicable to any hospital that is located in an 

urban area of a State may not be less than the area 

wage index applicable to hospitals located in rural 

areas in that State. Also, section 1886(d)(8)(C)(iv)(II) 

of the Act provides that an urban area’s wage index 

may not decrease as a result of redesignated 

hospitals if the urban area is located in a State that 

is composed of a single urban area. 

a rural area would be 0.19 percent and 

for an urban area, 0.42 percent. 

Conversely, 34 rural areas (72.3 percent) 

and 181 urban areas (47.0 percent) 

would benefit from this adjustment, 

with 1 urban area increasing 2.1 percent 

and 1 rural area increasing 0.39 percent. 

As there are no significant differences 

between the FY 2005 and the FY 2006 

occupational mix survey data and 

results, we believe it is appropriate to 

again apply the occupational mix to 10 

percent of the proposed FY 2006 wage 

index. (See Appendix A to this 

proposed rule for further analysis of the 

impact of the occupational mix 

adjustment on the proposed FY 2006 

wage index.) 

The wage index values in Tables 4A, 

4B, 4C, and 4F and the average hourly 

wages in Tables 2, 3A, and 3B in the 

Addendum to this proposed rule 

include the occupational mix 

adjustment. 

H. Proposed Revisions to the Wage 

Index Based on Hospital Redesignation 

(If you choose to comment on issues 

in this section, please include the 

caption ‘‘Hospital Redesignations and 

Reclassifications’’ at the beginning of 

your comment.) 

1. General 

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 IPPS. Hospitals must apply to 

the MGCRB to reclassify by September 

1 of the year preceding the year during 

which reclassification is sought. 

Generally, hospitals must be proximate 

to the labor market area to which they 

are seeking reclassification and must 

demonstrate characteristics similar to 

hospitals located in that area. The 

MGCRB issues its decisions by the end 

of February for reclassifications that 

become effective for the following fiscal 

year (beginning October 1). The 

regulations applicable to 

reclassifications by the MGCRB are 

located in §§ 412.230 through 412.280. 

Section 1886(d)(10)(D)(v) of the Act 

provides that, beginning with FY 2001, 

a MGCRB decision on a hospital 

reclassification for purposes of the wage 

index is effective for 3 fiscal years, 

unless the hospital elects to terminate 

the reclassification. Section 

1886(d)(10)(D)(vi) of the Act provides 

that the MGCRB must use the 3 most 

recent years’ average hourly wage data 

in evaluating a hospital’s 

reclassification application for FY 2003 

and any succeeding fiscal year. 

Section 304(b) of Pub. L. 106–554 

provides that the Secretary must 

establish a mechanism under which a 

statewide entity may apply to have all 

of the geographic areas in the State 

treated as a single geographic area for 

purposes of computing and applying a 

single wage index, for reclassifications 

beginning in FY 2003. The 

implementing regulations for this 

provision are located at § 412.235. 

Section 1886(d)(8)(B) of the Act 

requires the Secretary to treat a hospital 

located in a rural county adjacent to one 

or more urban areas as being located in 

the MSA to which the greatest number 

of workers in the county commute if: 

the rural county would otherwise be 

considered part of an urban area under 

the standards for designating MSAs if 

the commuting rates used in 

determining outlying counties were 

determined on the basis of the aggregate 

number of resident workers who 

commute to (and, if applicable under 

the standards, from) the central county 

or counties of all contiguous MSAs. In 

light of the new CBSA definitions and 

the Census 2000 data that we 

implemented for FY 2005 (69 FR 

49027), we undertook to identify those 

counties meeting these criteria. The 

eligible counties are identified below 

under section III.H.5. of this preamble. 

2. Effects of Reclassification 

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. These requirements for 

determining the wage index values for 

redesignated hospitals is applicable 

both to the hospitals located in rural 

counties deemed urban under section 

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

that were reclassified as a result of the 

MGCRB decisions under section 

1886(d)(10) of the Act. Therefore, as 

provided in section 1886(d)(8)(C) of the 

Act,3 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 area wage index 

determined inclusive of the wage data 

for the redesignated hospitals (the 

combined wage index value) applies to 

the redesignated hospitals. 

• If including the wage data for the 

redesignated hospitals increases the 

wage index value for the urban area to 

which the hospitals are redesignated, 

both the area and the redesignated 

hospitals receive the combined wage 

index value. Otherwise, the hospitals 

located in the urban area receive a wage 

index excluding the wage data of 

hospitals redesignated into the area. 

• The wage data for a reclassified 

urban hospital is included in both the 

wage index calculation of the area to 

which the hospital is reclassified 

(subject to the rules described above) 

and the wage index calculation of the 

urban area where the hospital is 

physically 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 (otherwise, redesignated 

rural hospitals are excluded from the 

calculation of the rural wage index). 

• 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. 

3. Proposed Application of Hold 

Harmless Protection for Certain Urban 

Hospitals Redesignated as Rural 

Section 401(a) of Pub. L. 106–113 (the 

Balanced Budget Refinement Act of 

1999) amended section 1886(d)(8) of the 

Act by adding paragraph (E). Section 

401(a) created a mechanism that permits 

an urban hospital to apply to the 

Secretary to be treated, for purposes of 

subsection (d), as being located in the 

rural area of the State in which the 

hospital is located. A hospital that is 

granted redesignation under section 

1886(d)(8)(E) of the Act, as added by 

section 401 of Pub. L. 106–113 is, 

therefore, treated as a rural hospital for 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23377 

all purposes of payment under the 

Medicare IPPS, including the 

standardized amount, wage index, and 

disproportionate share calculations as of 

the effective date of the redesignation. 

Under current policy, as a result of an 

approved redesignation of an urban 

hospital as a rural hospital, the wage 

index data are excluded from the wage 

index calculation for the area where the 

urban hospital is geographically located 

and included in the rural hospital wage 

index calculation. 

Last year, we became aware of an 

instance where the approved 

redesignation of an urban hospital as 

rural under section 1886(d)(8)(E) of the 

Act resulted in the hospital’s data 

having an adverse impact on the rural 

wage index. We received a public 

comment noting that specific ‘‘hold 

harmless’’ provisions apply to 

reclassifications that occur under 

section 1886(d)(8)(B) and section 

1886(d)(10) of the Act. That is, if a 

hospital is granted geographic 

reclassification under section 

1886(d)(8)(B) or section 1886(d)(10) of 

the Act, there are certain rules that 

apply when the inclusion of the 

hospital’s data results in a reduction of 

the reclassification area’s wage index, 

and these rules are slightly different for 

urban areas versus rural areas. These 

rules are more fully described in the FY 

2005 IPPS final rule (69 FR 49053). 

Generally stated, these rules prevent a 

rural area from being adversely affected 

as a result of reclassification. That is, if 

excluding the reclassifying hospitals’

wage data would decrease the wage 

index of the rural area, the reclassifying 

hospitals are included in the rural area’s 

wage index. Otherwise, the reclassifying 

hospitals are excluded. For hospitals 

reclassifying out of urban areas, the 

rules provide that the wage data for the 

reclassified urban hospital is included 

in the wage index calculation of the 

urban area where the hospital is 

physically located. 

The commenter recommended that 

we revise our regulations and apply 

similar hold harmless provisions and 

treat hospitals redesignated under 

1886(d)(8)(E) of the Act in the same 

manner as reclassifications under 

section 1886(d)(8)(B) and section 

1886(d)(10) of the Act. In our continued 

effort to promote consistency, equity 

and to simplify our rules with respect to 

how we construct the wage indexes of 

rural and urban areas, we are persuaded 

that there is a need to modify our policy 

when hospital redesignations occur 

under section 1886(d)(8)(E) of the Act. 

Therefore, for the FY 2006 wage index, 

we are proposing to apply the hold 

harmless rule that currently applies 

when rural hospitals are reclassifying 

out of the rural area (from rural to 

urban) to situations where hospitals are 

reclassifying into the rural area (from 

urban to rural under section 

1886(d)(8)(E) of the Act). Thus, the rule 

would be that the wage data of the 

urban hospital reclassifying into the 

rural area is included in the rural area’s 

wage index, if including the urban 

hospital’s data increases the wage index 

of the rural area. Otherwise, the wage 

data is excluded. Similarly, we are 

proposing to apply to these cases the 

rule that currently applies when urban 

hospitals reclassify under the MGCRB 

process. Thus, the wage data for an 

urban hospital reclassifying under 

section 1886(d)(8)(E) of the Act is 

always included in the wage index of 

the urban area where the hospital is 

located, and can also be included in the 

wage index of the rural area to which it 

is reclassifying (if doing so increases the 

rural area’s wage index). We believe this 

proposal provides uniformity in the way 

geographic areas are treated under all 

types of reclassifications. In addition, 

our proposal promotes predictability by 

alleviating fluctuations in the wage 

indexes due to a section 401 

redesignation. 

We are including in the Addendum to 

this proposed rule Table 9C, which 

shows hospitals redesignated under 

section 1886(d)(8)(E) of the Act. 

4. FY 2006 MGCRB Reclassifications 

At the time this proposed rule was 

constructed, the MGCRB had completed 

its review of FY 2006 reclassification 

requests. There were 295 hospitals 

approved for wage index 

reclassifications by the MGCRB for FY 

2006. Because MGCRB wage index 

reclassifications are effective for 3 years, 

hospitals reclassified during FY 2004 or 

FY 2005 are eligible to continue to be 

reclassified based on prior 

reclassifications to current MSAs during 

FY 2006. There were 395 hospitals 

reclassified for wage index for FY 2005, 

and 94 hospitals reclassified for wage 

index in FY 2004. Some of the hospitals 

that reclassified in FY 2004 and FY 

2005 have elected not to continue their 

reclassifications in FY 2006 because, 

under the new labor market area 

definitions, they are now physically 

located in the areas to which they 

previously reclassified. Of all of the 

hospitals approved for reclassification 

for FY 2004, FY 2005, and FY 2006, 672 

hospitals will be in a reclassification 

status for FY 2006. 

Prior to FY 2004, hospitals had been 

able to apply to be reclassified for 

purposes of either the wage index or the 

standardized amount. Section 401 of 

Pub. L. 108–173 established that all 

hospitals will be paid on the basis of the 

large urban standardized amount, 

beginning with FY 2004. Consequently, 

all hospitals are paid on the basis of the 

same standardized amount, which made 

such reclassifications moot. Although 

there could still be some benefit in 

terms of payments for some hospitals 

under the DSH payment adjustment for 

operating IPPS, section 402 of Pub. L. 

108–173 equalized DSH payment 

adjustments for rural and urban 

hospitals, with the exception that the 

rural DSH adjustment is capped at 12 

percent (except that RRCs have no cap). 

(A detailed discussion of this 

application appears in section IV.I. of 

the preamble of the FY 2005 IPPS final 

rule (69 FR 49085.) 

5. Proposed FY 2006 Redesignations 

Under Section 1886(d)(8)(B) of the Act 

Beginning October 1, 1988, section 

1886(d)(8)(B) of the Act required us to 

treat a hospital located in a rural county 

adjacent to one or more urban areas as 

being located in the MSA if certain 

criteria were met. Prior to FY 2005, the 

rule was that a rural county adjacent to 

one or more urban areas would be 

treated as being located in the MSA to 

which the greatest number of workers in 

the county commute, if the rural county 

would otherwise be considered part of 

an urban area under the standards 

published in the Federal Register on 

January 3, 1980 (45 FR 956) for 

designating MSAs (and NECMAs), and 

if the commuting rates used in 

determining outlying counties (or, for 

New England, similar recognized areas) 

were determined on the basis of the 

aggregate number of resident workers 

who commute to (and, if applicable 

under the standards, from) the central 

county or counties of all contiguous 

MSAs (or NECMAs). Hospitals that met 

the criteria using the January 3, 1980 

version of these OMB standards were 

deemed urban for purposes of the 

standardized amounts and for purposes 

of assigning the wage data index. 

On June 6, 2003, OMB announced the 

new CBSAs based on Census 2000 data. 

For FY 2005, we used OMB’s 2000 

CBSA standards and the Census 2000 

data to identify counties qualifying for 

redesignation under section 

1886(d)(8)(B) for the purpose of 

assigning the wage index to the urban 

area. We presented this listing, effective 

for discharges occurring on or after 

October 1, 2004 (FY 2005), in Chart 6 of 

the FY 2005 final rule (69 FR 49057). 

However, Chart 6 in the FY 2005 final 

rule contained a printing error in which 

we misidentified rural counties that 

qualified for redesignation under 

23378 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

section 1886(d)(8)(B) of the Act. The list 

of rural counties qualifying to be urban 

in that Chart 6 incorrectly included 

Monroe, PA and Walworth, WI. This 

error was made only in the chart and 

not in the application of the rules; that 

is, we correctly applied the rules to the 

correct rural counties qualifying to be 

urban for FY 2005. 

In addition, we discovered that, in the 

FY 2005 IPPS final rule, we had 

erroneously printed the names of the 

entire Metropolitan Statistical Areas 

rather than the Metropolitan Division 

names. Because we recognized 

Metropolitan Divisions as MSAs in the 

FY 2005 IPPS final rule (69 FR 49029), 

we should have printed the division 

names for the following counties: 

Henry, FL; Starke, IN; Henderson, TX; 

Fannin, TX; and Island, WA. 

The chart below contains the 

corrected listing of the rural counties 

designated as urban under section 

1886(d)(8)(B) of the Act that we are 

proposing to use for FY 2006. We are 

proposing that, for discharges occurring 

on or after October 1, 2005, hospitals 

located in the first column of this chart 

will be redesignated for purposes of 

using the wage index of the urban area 

listed in the second column. 

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BILLING CODE 4120–01–C 


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As in the past, hospitals redesignated 

under section 1886(d)(8)(B) of the Act 

are also eligible to be reclassified to a 

different area by the MGCRB. Affected 

hospitals are permitted to compare the 

reclassified wage index for the labor 

market area in Table 4C in the 

Addendum of this proposed rule into 

which they have been reclassified by the 

MGCRB to the wage index for the area 

to which they are redesignated under 

section 1886(d)(8)(B) of the Act. 

Hospitals may withdraw from an 

MGCRB reclassification within 45 days 

of the publication of this proposed rule. 

6. Reclassifications Under Section 508 

of Pub. L. 108–173 

Under section 508 of Pub. L. 108–173, 

a qualifying hospital could appeal the 

wage index classification otherwise 

applicable to the hospital and apply for 

reclassification to another area of the 

State in which the hospital is located 

(or, at the discretion of the Secretary, to 

an area within a contiguous State). We 

implemented this process through 

notices published in the Federal 

Register on January 6, 2004 (69 FR 661) 

and February 13, 2004 (69 FR 7340). 

Such reclassifications are applicable to 

discharges occurring during the 3-year 

period beginning April 1, 2004 and 

ending March 31, 2007. Under section 

508(b), reclassifications under this 

process do not affect the wage index 

computation for any area or for any 

other hospital and cannot be effected in 

a budget neutral manner. 

We show the reclassifications 

effective under the one-time appeal 

process in Table 9B in the Addendum 

to this proposed rule. 

I. Proposed FY 2006 Wage Index 

Adjustment Based on Commuting 

Patterns of Hospital Employees 

(If you choose to comment on issues 

in this section, please include the 

caption ‘‘Out-Migration Adjustment’’ at 

the beginning of your comment.) 

In accordance with the broad 

discretion under section 1886(d)(13) of 

the Act, as added by section 505 of Pub. 

L. 108–173, beginning with FY 2005, we 

established a process to make 

adjustments to the hospital wage index 

based on commuting patterns of 

hospital employees. The process, 

outlined in the FY 2005 IPPS final rule 

(69 FR 49061), provides for an increase 

in the wage index for hospitals located 

in certain counties that have a relatively 

high percentage of hospital employees 

who reside in the county but work in a 

different county (or counties) with a 

higher wage index. Such adjustments to 

the wage index are effective for 3 years, 

unless a hospital requests to waive the 

application of the adjustment. A county 

will not lose its status as a qualifying 

county due to wage index changes 

during the 3-year period, and counties 

will receive the same wage index 

increase for those 3 years. However, a 

county that qualifies in any given year 

may no longer qualify after the 3-year 

period, or it may qualify but receive a 

different adjustment to the wage index 

level. Hospitals that receive this 

adjustment to their wage index are not 

eligible for reclassification under 

section 1886(d)(8) or section 1886(d)(10) 

of the Act. Adjustments under this 

provision are not subject to the IPPS 

budget neutrality requirements at 

section 1886(d)(3)(E) or section 

1886(d)(8)(D) of the Act. 

Hospitals located in counties that 

qualify for the wage index adjustment 

are to receive an increase in the wage 

index that is equal to the average of the 

differences between the wage indexes of 

the labor market area(s) with higher 

wage indexes and the wage index of the 

resident county, weighted by the overall 

percentage of hospital workers residing 

in the qualifying county who are 

employed in any labor market area with 

a higher wage index. We have employed 

the prereclassified wage indexes in 

making these calculations. 

We are proposing that hospitals 

located in the qualifying counties 

identified in Table 4J in the Addendum 

to this proposed rule that have not 

already reclassified through section 

1886(d)(10) of the Act, redesignated 

through section 1886(d)(8) of the Act, 

received a section 508 reclassification, 

or requested to waive the application of 

the out-migration adjustment would 

receive the wage index adjustment 

listed in the table for FY 2006. We used 

the same formula described in the FY 

2005 final rule (69 FR 49064) to 

calculate the out-migration adjustment. 

This proposed adjustment was 

calculated as follows: 

Step 1. Subtract the wage index for 

the qualifying county from the wage 

index for the higher wage area(s). 

Step 2. Divide the number of hospital 

employees residing in the qualifying 

county who are employed in such 

higher wage index area by the total 

number of hospital employees residing 

in the qualifying county who are 

employed in any higher wage index 

area. Multiply this result by the result 

obtaining in Step 1. 

Step 3. Sum the products resulting 

from Step 2 (if the qualifying county has 

workers commuting to more than one 

higher wage area). 

Step 4. Multiply the result from Step 

3 by the percentage of hospital 

employees who are residing in the 

qualifying county and who are 


EP04MY05.030</GPH>
23382 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

employed in any higher wage index 

area. 

The proposed adjustments calculated 

for qualifying hospitals are listed in 

Table 4J in the Addendum to this 

proposed rule. These proposed 

adjustments would be effective for each 

county for a period of 3 fiscal years. 

Hospitals that received the adjustment 

in FY 2005 will be eligible to retain that 

same adjustment for FY 2006 and FY 

2007. For hospitals in newly qualified 

counties, adjustments to the wage index 

would be effective for 3 years, beginning 

with discharges occurring on or after 

October 1, 2005. 

As previously noted, hospitals 

receiving the wage index adjustment 

under section 1886(d)(13)(F) of the Act 

are not eligible for reclassification under 

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

reclassifications under section 508 of 

Pub. L. 108–173. Hospitals that wish to 

waive the application of this wage index 

adjustment must notify CMS within 45 

days of the publication of this proposed 

rule. Waiver notification should be sent 

to the following address: Centers for 

Medicare and Medicaid Services, Center 

for Medicare Management, Attention: 

Wage Index Adjustment Waivers, 

Division of Acute Care, Room C4–08–

06, 7500 Security Boulevard, Baltimore, 

MD 21244–1850. We will assume that 

hospitals that have been redesignated 

under section 1886(d)(8) of the Act or 

reclassified under section 886(d)(10) of 

the Act or under section 508 of Pub. L. 

108–173 would prefer to keep their 

redesignation/reclassification unless 

they explicitly notify CMS that they 

would like to receive the out-migration 

adjustment instead. In addition, 

hospitals that wish to retain their 

redesignation/reclassification (instead of 

receiving the out-migration adjustment) 

for FY 2006 do not need to submit a 

formal request to CMS, and will 

automatically retain their redesignation/ 

reclassification status for FY 2006. 

However, consistent with § 412.273, 

hospitals that have been reclassified by 

the MGCRB are permitted to withdraw 

their applications within 45 days of the 

publication of this proposed rule. 

Hospitals that have been reclassified by 

the MGCRB (including reclassifications 

under section 508 of Pub. L. 108–173) 

may terminate an existing 3-year 

reclassification within 45 days of the 

publication of this proposed rule in 

order to receive the wage index 

adjustment under this provision. 

Hospitals that are eligible to receive the 

wage index adjustment and that 

withdraw their application for 

reclassification will then automatically 

receive the wage index adjustment 

listed in Table 4J in the Addendum to 

this proposed rule. The request for 

withdrawal of an application for 

reclassification or termination of an 

existing 3-year reclassification that 

would be effective in FY 2006 must be 

received by the MGCRB within 45 days 

of the publication of this proposed rule. 

Hospitals should carefully review the 

wage index adjustment that they would 

receive under this provision (as listed in 

Table 2 in the Addendum to this 

proposed rule) in comparison to the 

wage index adjustment that they would 

receive under the MGCRB 

reclassification (Table 9 in the 

Addendum to this proposed rule). 

J. Process for Requests for Wage Index 

Data Corrections 

(If you choose to comment on issues 

in this section, please include the 

caption ‘‘Wage Index Data Corrections’’

at the beginning of your comment.) 

In the FY 2005 IPPS final rule (68 FR 

27194), we revised the process and 

timetable for application for 

development of the wage index, 

beginning with the FY 2005 wage index. 

The preliminary and unaudited 

Worksheet S–3 wage data and 

occupational mix survey files were 

made available on October 8, 2004 

through the Internet on the CMS Web 

site at: http://cms.hhs.gov/providers/ 

hipps/ippswage.asp. In a memorandum 

dated October 6, 2004, we instructed all 

Medicare fiscal intermediaries to inform 

the IPPS hospitals they service of the 

availability of the wage index data files 

and the process and timeframe for 

requesting revisions (including the 

specific deadlines listed below). We also 

instructed the fiscal intermediaries to 

advise hospitals that these data are also 

made available directly through their 

representative hospital organizations. 

If a hospital wished to request a 

change to its data as shown in the 

October 8, 2004 wage and occupational 

mix data files, the hospital was to 

submit corrections along with complete, 

detailed supporting documentation to 

its fiscal intermediary by November 29, 

2004. Hospitals were notified of this 

deadline and of all other possible 

deadlines and requirements, including 

the requirement to review and verify 

their data as posted on the preliminary 

wage index data file on the Internet, 

through the October 6, 2004 

memorandum referenced above. 

In the October 6, 2004 memorandum, 

we also specified that a hospital could 

only request revisions to the 

occupational mix data for the reporting 

period that the hospital used in its 

original FY 2005 wage index 

occupational mix survey. That is, a 

hospital that submitted occupational 

mix data for the 12-month reporting 

period could not switch to submitting 

data for the 4-week reporting period and 

vice versa. Further, a hospital could not 

submit an occupational mix survey for 

the periods beginning before January 1, 

2003, or after January 11, 2004. In 

addition, a hospital that did not submit 

an occupational mix survey for the FY 

2005 wage index was not permitted to 

submit a survey for the FY 2006 wage 

index. 

The fiscal intermediaries notified the 

hospitals by mid-February 2005 of any 

changes to the wage index data as a 

result of the desk reviews and the 

resolution of the hospitals’ late 

November 2004 change requests. The 

fiscal intermediaries also submitted the 

revised data to CMS by mid-February 

2005. CMS published the proposed 

wage index public use files that 

included hospitals’ revised wage data 

on February 25, 2005. In a 

memorandum also dated February 25, 

2005, we instructed fiscal 

intermediaries to notify all hospitals 

regarding the availability of the 

proposed wage index public use files 

and the criteria and process for 

requesting corrections and revisions to 

the wage index data. Hospitals had until 

March 14, 2005 to submit requests to the 

fiscal intermediaries for reconsideration 

of adjustments made by the fiscal 

intermediaries as a result of the desk 

review, and to correct errors due to 

CMS’s or the fiscal intermediary’s 

mishandling of the wage index data. 

Hospitals were also required to submit 

sufficient documentation to support 

their requests. 

After reviewing requested changes 

submitted by hospitals, fiscal 

intermediaries are to submit any 

additional revisions resulting from the 

hospitals’ reconsideration requests by 

April 15, 2005. The deadline for a 

hospital to request CMS intervention in 

cases where the hospital disagrees with 

the fiscal intermediary’s policy 

interpretations is April 22, 2005. 

Hospitals should also examine Table 

2 in the Addendum to this proposed 

rule. Table 2 contains each hospital’s 

adjusted average hourly wage used to 

construct the wage index values for the 

past 3 years, including the FY 2002 data 

used to construct the FY 2006 wage 

index. We note that the hospital average 

hourly wages shown in Table 2 only 

reflect changes made to a hospital’s data 

and transmitted to CMS by February 23, 

2005. 

We will release a final wage index 

data public use file in early May 2005 

to hospital associations and the public 

on the Internet at http:// 

www.cms.hhs.gov/providers/hipps/ 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23383 

ippswage.asp. The May 2005 public use 

file will be made available solely for the 

limited purpose of identifying any 

potential errors made by CMS or the 

fiscal intermediary in the entry of the 

final wage data that result from the 

correction process described above 

(revisions submitted to CMS by the 

fiscal intermediaries by April 15, 2005). 

If, after reviewing the May 2005 final 

file, a hospital believes that its wage 

data were incorrect due to a fiscal 

intermediary or CMS error in the entry 

or tabulation of the final wage data, it 

should send a letter to both its fiscal 

intermediary and CMS that outlines 

why the hospital believes an error exists 

and provide all supporting information, 

including relevant dates (for example, 

when it first became aware of the error). 

CMS and the fiscal intermediaries must 

receive these requests no later than June 

10, 2005. Requests mailed to CMS 

should be sent to: 

Centers for Medicare & Medicaid 

Services, Center for Medicare 

Management, Attention: Wage Index 

Team, Division of Acute Care, C4–08–

06, 7500 Security Boulevard, 

Baltimore, MD 21244–1850. 

Each request also must be sent to the 

fiscal intermediary. The fiscal 

intermediary will review requests upon 

receipt and contact CMS immediately to 

discuss its findings. 

At this point in the process, that is, 

after the release of the May 2005 wage 

index data file, changes to the hospital 

wage data will only be made in those 

very limited situations involving an 

error by the fiscal intermediary or CMS 

that the hospital could not have known 

about before its review of the final wage 

index data file. Specifically, neither the 

intermediary nor CMS will approve the 

following types of requests: 

• Requests for wage data corrections 

that were submitted too late to be 

included in the data transmitted to CMS 

by fiscal intermediaries on or before 

April 15, 2005. 

• Requests for correction of errors 

that were not, but could have been, 

identified during the hospital’s review 

of the February 25, 2005 wage index 

data file. 

• Requests to revisit factual 

determinations or policy interpretations 

made by the fiscal intermediary or CMS 

during the wage index data correction 

process. 

Verified corrections to the wage index 

received timely by CMS and the fiscal 

intermediaries (that is, by June 10, 2005) 

will be incorporated into the final wage 

index to be published by August 1, 

2005, and to be effective October 1, 

2005. 

We created the processes described 

above to resolve all substantive wage 

index data correction disputes before we 

finalize the wage and occupational mix 

data for the FY 2006 payment rates. 

Accordingly, hospitals that do not meet 

the procedural deadlines set forth above 

will not be afforded a later opportunity 

to submit wage index data corrections or 

to dispute the fiscal intermediary’s 

decision with respect to requested 

changes. Specifically, our policy is that 

hospitals that do not meet the 

procedural deadlines set forth above 

will not be permitted to challenge later, 

before the Provider Reimbursement 

Review Board, the failure of CMS to 

make a requested data revision (See W. 

A. Foote Memorial Hospital v. Shalala, 

No. 99–CV–75202–DT (E.D. Mich. 

2001), also Palisades General Hospital 

v. Thompson, No. 99–1230 (D.D.C. 

2003)). 

Again, we believe the wage index data 

correction process described above 

provides hospitals with sufficient 

opportunity to bring errors in their wage 

index data to the fiscal intermediaries’

attention. Moreover, because hospitals 

will have access to the final wage index 

data by early May 2005, they have the 

opportunity to detect any data entry or 

tabulation errors made by the fiscal 

intermediary or CMS before the 

development and publication of the 

final FY 2006 wage index by August 1, 

2005, and the implementation of the FY 

2006 wage index on October 1, 2005. If 

hospitals avail themselves of the 

opportunities afforded to provide and 

make corrections to the wage data, the 

wage index implemented on October 1 

should be accurate. Nevertheless, in the 

event that errors are identified by 

hospitals and brought to our attention 

after June 10, 2005, we retain the right 

to make midyear changes to the wage 

index under very limited circumstances. 

Specifically, in accordance with 

§ 412.64(k)(1) of our existing 

regulations, we make midyear 

corrections to the wage index for an area 

only if a hospital can show that: (1) The 

fiscal intermediary or CMS made an 

error in tabulating its data; and (2) the 

requesting 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. 

For purposes of this provision, ‘‘before 

the beginning of the fiscal year’’ means 

by the June deadline for making 

corrections to the wage data for the 

following fiscal year’s wage index. This 

provision is not available to a hospital 

seeking to revise another hospital’s data 

that may be affecting the requesting 

hospital’s wage index for the labor 

market area. As indicated earlier, since 

CMS makes the wage data available to 

a hospital on the CMS website prior to 

publishing both the proposed and final 

IPPS rules, and the fiscal intermediaries 

notify hospitals directly of any wage 

data changes after completing their desk 

reviews, we do not expect that midyear 

corrections would be necessary. 

However, under our current policy, if 

the correction of a data error changes 

the wage index value for an area, the 

revised wage index value will be 

effective prospectively from the date the 

correction is made. 

We are proposing to revise 

§ 412.64(k)(2) to specify that a change to 

the wage index can be made retroactive 

to the beginning of the Federal fiscal 

year only when: (1) The fiscal 

intermediary or CMS made an error in 

tabulating data used for the wage index 

calculation; (2) the hospital knew about 

the error and requested that the fiscal 

intermediary and CMS correct the error 

using the established process and 

within the established schedule for 

requesting corrections to the wage data, 

before the beginning of the fiscal year 

for the applicable IPPS update (that is, 

by the June 10, 2005 deadline for the FY 

2006 wage index); and (3) CMS agreed 

that the fiscal intermediary or CMS 

made an error in tabulating the 

hospital’s wage data and the wage index 

should be corrected. We are proposing 

this change because there may be 

instances in which a hospital identifies 

an error in its wage data and submits a 

correction request using all appropriate 

procedures and by the June deadline, 

CMS agrees that the fiscal intermediary 

or CMS caused the error in the 

hospital’s wage data and that the wage 

index must be corrected, but CMS fails 

to publish or implement the corrected 

wage index value by the beginning of 

the Federal fiscal year. We believe that 

the above proposed revision to 

§ 412.64(k)(2) is appropriate and fair. 

We also believe that unlike a 

generalized retroactive policy, the 

situations where this will occur will be 

minimal, thus minimizing the 

administrative burden associated with 

such retroactive corrections. In those 

circumstances where a hospital requests 

a correction to its wage data before CMS 

calculates the final wage index (that is, 

by the June deadline), and CMS 

acknowledges that the error in the 

hospital’s wage data caused by CMS’s or 

the fiscal intermediary’s mishandling of 

the data, we believe that the hospital 

should not be penalized by our delay in 

publishing or implementing the 

correction. As with our current policy, 

this provision would not be available to 

a hospital seeking to revise another 

23384 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

hospital’s data. In addition, the 

provision could not be used to correct 

prior years’ wage data; it could only be 

used for the current Federal fiscal year. 

In other situations, we continue to 

believe that it is appropriate to make 

prospective corrections to the wage 

index in those circumstances where a 

hospital could not have known about or 

did not have the opportunity to correct 

the fiscal intermediary’s or CMS’s error 

before the beginning of the fiscal year 

(that is, by the June deadline). 

We are proposing to make this change 

to § 412.64(k)(2) effective on October 1, 

2005, that is, beginning with the FY 

2006 wage index. We note that, as with 

prospective changes to the wage index, 

the proposed retroactive correction 

would be made irrespective of whether 

the change increases or decreases a 

hospital’s payment rate. In addition, we 

note that the policy of retroactive 

adjustment would still apply in those 

instances where a judicial decision 

reverses a CMS denial of a hospital’s 

wage data revision request. 

In addition, we are proposing to 

correct the FY 2005 wage index 

retroactively (that is, from October 1, 

2004) on a one-time only basis for a 

limited circumstance using the 

authority provided under section 

903(a)(1) of Pub. L. 108–173. This 

provision authorizes the Secretary to 

make retroactive changes to items and 

services if failure to apply such changes 

would be contrary to the public interest. 

However, as indicated, our current 

regulations at § 412.64(k)(1) allow only 

for a prospective correction to the 

hospitals’ area wage index values. We 

are proposing to correct the FY 2005 

wage index retroactively in the limited 

circumstance where a hospital meets all 

of the following criteria: (1) The fiscal 

intermediary or CMS made an error in 

tabulating a hospital’s FY 2005 wage 

index data; (2) the hospital informed the 

fiscal intermediary or CMS, or both, 

about the error, following the 

established schedule and process for 

requesting corrections to its FY 2005 

wage index data; and (3) CMS agreed 

before October 1 that the fiscal 

intermediary or CMS made an error in 

tabulating the hospital’s wage data and 

the wage index should be corrected by 

the beginning of the Federal fiscal year 

(that is, by October 1, 2004), but CMS 

was unable to publish the correction by 

the beginning of the fiscal year. 

On December 30, 2004, we published 

in the Federal Register a correction 

notice to the FY 2005 IPPS final rule 

that included the corrected wage data 

for four hospitals that meet all of the 

three above stated criteria (69 FR 

78526). These corrections were effective 

January 1, 2005. As noted, our current 

regulations allow only for a prospective 

correction to the hospitals’ area wage 

index values. However, we believe that, 

in the limited circumstance mentioned 

above, a retroactive correction to the FY 

2005 wage index is appropriate and 

meets the condition of section 903(a)(1) 

of Pub. L. 108–173 that ‘‘failure to apply 

the change retroactively would be 

contrary to the public interest.’’

IV. Proposed Rebasing and Revision of 

the Hospital Market Baskets 

(If you choose to comment on issues 

in this section, please include the 

caption ‘‘Hospital Market Basket’’ at the 

beginning of your comment.) 

A. Background 

Effective for cost reporting periods 

beginning on or after July 1, 1979, we 

developed and adopted a hospital input 

price index (that is, the hospital market 

basket 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,’’

while often used interchangeably, 

actually denote different activities. 

‘‘Rebasing’’ means moving the base year 

for the structure of costs of an input 

price index (for example, in this 

proposed rule, we are proposing to shift 

the base year cost structure for the IPPS 

hospital index from FY 1997 to FY 

2002). ‘‘Revising’’ means changing data 

sources, or price proxies, used in the 

input price index. 

The percentage change in the market 

basket reflects the average change in the 

price of goods and services hospitals 

purchase in order to furnish inpatient 

care. We first used the market basket to 

adjust hospital cost limits by an amount 

that reflected the average increase in the 

prices of the goods and services used to 

provide hospital inpatient care. This 

approach linked the increase in the cost 

limits to the efficient utilization of 

resources. 

Since the inception of the IPPS, the 

projected change in the hospital market 

basket has been the integral component 

of the update factor by which the 

prospective payment rates are updated 

every year. An explanation of the 

hospital market basket used to develop 

the prospective payment rates was 

published in the Federal Register on 

September 1, 1983 (48 FR 39764). We 

also refer the reader to the August 1, 

2002 Federal Register (67 FR 50032) in 

which we discussed the previous 

rebasing of the hospital input price 

index. 

The hospital market basket is a fixed 

weight, Laspeyres-type price index that 

is constructed in three steps. First, a 

base period is selected (in this proposed 

rule, FY 2002) and total base period 

expenditures are estimated for a set of 

mutually exclusive and exhaustive 

spending categories based upon type of 

expenditure. Then the proportion of 

total operating costs that each category 

represents is determined. These 

proportions are called cost or 

expenditure weights. Second, each 

expenditure category is matched to an 

appropriate price or wage variable, 

referred to as a price proxy. In nearly 

every instance, these price proxies are 

price levels derived from publicly 

available statistical series that are 

published on a consistent schedule, 

preferably at least on a quarterly basis. 

Finally, the expenditure weight for 

each cost category is multiplied by the 

level of its respective price proxy. The 

sum of these products (that is, the 

expenditure weights multiplied by their 

price levels) for all cost categories yields 

the composite index level of the market 

basket in a given period. Repeating this 

step for other periods produces a series 

of market basket levels over time. 

Dividing an index level for a given 

period by an index level for an earlier 

period produces a rate of growth in the 

input price index over that time period. 

The market basket is described as a 

fixed-weight index because it describes 

the change in price over time of the 

same mix of goods and services 

purchased to provide hospital services 

in a base period. The effects on total 

expenditures resulting from changes in 

the quantity or mix of goods and 

services (intensity) purchased 

subsequent to the base period are not 

measured. For example, shifting a 

traditionally inpatient type of care to an 

outpatient setting might affect the 

volume of inpatient goods and services 

purchased by the hospital, but would 

not be factored into the price change 

measured by a fixed weight hospital 

market basket. In this manner, the 

market basket measures only the pure 

price change. Only when the index is 

rebased using a more recent base period 

would the quantity and intensity effects 

be captured in the cost weights. 

Therefore, we rebase the market basket 

periodically so the cost weights reflect 

changes in the mix of goods and 

services that hospitals purchase 

(hospital inputs) to furnish inpatient 

care between base periods. We last 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23385 

rebased the hospital market basket cost 

weights effective for FY 2003 (67 FR 

50032, August 1, 2002), with FY 1997 

data used as the base period for the 

construction of the market basket cost 

weights. 

B. Rebasing and Revising the Hospital 

Market Basket 

1. Development of Cost Categories and 

Weights 

a. Medicare Cost Reports 

The major source of expenditure data 

for developing the proposed rebased 

and revised hospital market basket cost 

weights is the FY 2002 Medicare cost 

reports. These cost reports are from IPPS 

hospitals only. They do not reflect data 

from hospitals excluded from the IPPS 

or CAHs. The IPPS cost reports yield 

seven major expenditure or cost 

categories: wages and salaries, employee 

benefits, contract labor, 

pharmaceuticals, professional liability 

insurance (malpractice), blood and 

blood products, and a residual ‘‘all 

other.’’

b. Other Data Sources 

In addition to the Medicare cost 

reports, other sources of data used in 

developing the market basket weights 

are the Benchmark Input-Output Tables 

(I–Os) created by the Bureau of 

Economic Analysis, U.S. Department of 

Commerce, and the Business Expenses 

Survey developed by the Bureau of the 

Census, U.S. Department of Commerce, 

from its Economic Census. 

New data for these Census sources are 

scheduled for publication every 5 years, 

but often take up to 7 years after the 

reference year. Only an Annual I–O is 

produced each year, but the Annual I–

O contains less industry detail than 

does the Benchmark I–O. When we 

rebased the market basket using FY 

1997 data in the FY 2003 IPPS final 

rule, the 1997 Benchmark I–O was not 

yet available. Therefore, we did not 

incorporate data from that source into 

the FY 1997-based market basket (67 FR 

50033). However, we did use a 

secondary source, the 1997 Annual 

Input-Output tables. The third source of 

data, the 1997 Business Expenditure 

Survey (now known as the Business 

Expenses Survey) was used to develop 

weights for the utilities and telephone 

services categories. 

The 1997 Benchmark I–O data are a 

much more comprehensive and 

complete set of data than the 1997 

Annual I–O estimates. The 1997 Annual 

I–O is an update of the 1992 I–O tables, 

while the 1997 Benchmark I–O is an 

entirely new set of numbers derived 

from the 1997 Economic Census. The 

2002 Benchmark Input-Output tables 

are not yet available. Therefore, we are 

proposing to use the 1997 Benchmark I–

O data in the proposed FY 2002-based 

market basket, to be effective for FY 

2006. Instead of using the less detailed, 

less accurate Annual I–O data, we aged 

the 1997 Benchmark I–O data forward to 

FY 2002. The methodology we used to 

age the data involves applying the 

annual price changes from the price 

proxies to the appropriate cost 

categories. We repeat this practice for 

each year. 

The ‘‘all other’’ cost category is further 

divided into other hospital expenditure 

category shares using the 1997 

Benchmark Input-Output tables. 

Therefore, the ‘‘all other’’ cost category 

expenditure shares are proportional to 

their relationship to ‘‘all other’’ totals in 

the I–O tables. For instance, if the cost 

for telephone services were to represent 

10 percent of the sum of the ‘‘all other’’

I–O (see below) hospital expenditures, 

then telephone services would represent 

10 percent of the market basket’s ‘‘all 

other’’ cost category. 

2. PPS—Selection of Price Proxies 

After computing the FY 2002 cost 

weights for the proposed rebased 

hospital market basket, it is necessary to 

select appropriate wage and price 

proxies to reflect the rate-of-price 

change for each expenditure category. 

With the exception of the Professional 

Liability proxy, all the indicators are 

based on Bureau of Labor Statistics 

(BLS) data and are grouped into one of 

the following BLS categories: 

• Producer Price Indexes—Producer 

Price Indexes (PPIs) measure price 

changes for goods sold in other than 

retail markets. PPIs are preferable price 

proxies for goods that hospitals 

purchase as inputs in producing their 

outputs because the PPIs would better 

reflect the prices faced by hospitals. For 

example, we use a special PPI for 

prescription drugs, rather than the 

Consumer Price Index (CPI) for 

prescription drugs because hospitals 

generally purchase drugs directly from 

the wholesaler. The PPIs that we use 

measure price change at the final stage 

of production. 

• Consumer Price Indexes—

Consumer Price Indexes (CPIs) measure 

change in the prices of final goods and 

services bought by the typical 

consumer. Because they may not 

represent the price faced by a producer, 

we used CPIs only if an appropriate PPI 


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was not available, or if the expenditures 

were more similar to those of retail 

consumers in general rather than 

purchases at the wholesale level. For 

example, the CPI for food purchased 

away from home is used as a proxy for 

contracted food services. 

• Employment Cost Indexes—

Employment Cost Indexes (ECIs) 

measure the rate of change in employee 

wage rates and employer costs for 

employee benefits per hour worked. 

These indexes are fixed-weight indexes 

and strictly measure the change in wage 

rates and employee benefits per hour. 

Appropriately, they are not affected by 

shifts in employment mix. 

We evaluated the price proxies using 

the criteria of reliability, timeliness, 

availability, and relevance. Reliability 

indicates that the index is based on 

valid statistical methods and has low 

sampling variability. Timeliness implies 

that the proxy is published regularly, at 

least once a quarter. Availability means 

that the proxy is publicly available. 

Finally, relevance means that the proxy 

is applicable and representative of the 

cost category weight to which it is 

applied. The CPIs, PPIs, and ECIs 

selected meet these criteria. 

Chart 2 sets forth the complete 

proposed market basket including cost 

categories, weights, and price proxies. 

For comparison purposes, the 

corresponding FY 1997-based market 

basket is listed as well. A summary 

outlining the choice of the various 

proxies follows the chart. 

BILLING CODE 4120–01–P 

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BILLING CODE 4120–01–C 


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BILLING CODE 4120–01–C 

a. Wages and Salaries 

For measuring the price growth of 

wages in the proposed FY 2002-based 

market basket, we are proposing to use 

the ECI for wages and salaries for 

civilian hospital workers as the proxy 

for wages in the hospital market basket. 

This same proxy was used for the 1997- 

based market basket. 

b. Employee Benefits 

The proposed FY 2002-based hospital 

market basket uses the ECI for employee 

benefits for civilian hospital workers. 

This is the same proxy that was used in 

the FY 1997-based market basket. 

c. Nonmedical Professional Fees 

The ECI for compensation for 

professional and technical workers in 

private industry is applied to this 

category because it includes 

occupations such as management and 

consulting, legal, accounting and 

engineering services. The same proxy 

was used in the FY 1997-based market 

basket. 

d. Fuel, Oil, and Gasoline 

The percentage change in the price of 

gas fuels as measured by the PPI 

(Commodity Code #0552) is applied to 

this component. The same proxy was 

used in the FY 1997-based market 

basket. 

e. Electricity 

The percentage change in the price of 

commercial electric power as measured 

by the PPI (Commodity Code #0542) is 

applied to this component. The same 

proxy was used in the FY 1997-based 

market basket. 

f. Water and Sewerage 

The percentage change in the price of 

water and sewerage maintenance as 

measured by the CPI for all urban 

consumers (CPI Code 

#CUUR0000SEHG01) is applied to this 

component. The same proxy was used 

in the FY 1997-based market basket. 

g. Professional Liability Insurance 

The proposed FY 2002-based index 

uses the percentage change in the 

hospital professional liability insurance 

(PLI) premiums as estimated by the 

CMS Hospital Professional Liability 

Index, which we use as a proxy in the 

Medicare Economic Index (68 FR 

63244), for the proxy of this category. 

Similar to the Physicians Professional 

Liability Index, we attempt to collect 

commercial insurance premiums for a 

fixed level of coverage, holding 

nonprice factors constant (such as a 

change in the level of coverage). In the 

FY 1997-based market basket, the same 

price proxy was used. 

We continue to research options for 

improving our proxy for professional 

liability insurance. This research 

includes exploring various options for 

expanding our current survey, including 

the identification of another entity that 

would be willing to work with us to 

collect more complete and 

comprehensive data. We are also 

exploring other options such as third 

party or industry data that might assist 

us in creating a more precise measure of 

PLI premiums. At this time, we have not 

yet identified a preferred option. 

Therefore, we are not proposing to make 

any changes to the proxy in this 

proposed rule. 

h. Pharmaceuticals 

The percentage change in the price of 

prescription drugs as measured by the 

PPI (PPI Code #PPI283D#RX) is used as 

a proxy for this category. This is a 

special index produced by BLS and is 

the same proxy used in the 1997-based 

index. 

i. Food: Direct Purchases 

The percentage change in the price of 

processed foods and feeds as measured 

by the PPI (Commodity Code #02) is 

applied to this component. The same 

proxy was used in the FY 1997-based 

market basket. 

j. Food: Contract Services 

The percentage change in the price of 

food purchased away from home as 

measured by the CPI for all urban 

consumers (CPI Code #CUUR0000SEFV) 

is applied to this component. The same 

proxy was used in the FY 1997-based 

market basket. 

k. Chemicals 

The percentage change in the price of 

industrial chemical products as 

measured by the PPI (Commodity Code 

#061) is applied to this component. 

While the chemicals hospitals purchase 

include industrial as well as other types 

of chemicals, the industrial chemicals 

component constitutes the largest 

proportion by far. Thus, we believe that 

Commodity Code #061 is the 

appropriate proxy. The same proxy was 

used in the FY 1997-based market 

basket. 

l. Medical Instruments 

The percentage change in the price of 

medical and surgical instruments as 


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measured by the PPI (Commodity Code 

#1562) is applied to this component. 

The same proxy was used in the FY 

1997-based market basket. 

m. Photographic Supplies 

The percentage change in the price of 

photographic supplies as measured by 

the PPI (Commodity Code #1542) is 

applied to this component. The same 

proxy was used in the FY 1997-based 

market basket. 

n. Rubber and Plastics 

The percentage change in the price of 

rubber and plastic products as measured 

by the PPI (Commodity Code #07) is 

applied to this component. The same 

proxy was used in the FY 1997-based 

market basket. 

o. Paper Products 

The percentage change in the price of 

converted paper and paperboard 

products as measured by the PPI 

(Commodity Code #0915) is used. The 

same proxy was used in the FY 1997- 

based market basket. 

p. Apparel 

The percentage change in the price of 

apparel as measured by the PPI 

(Commodity Code #381) is applied to 

this component. The same proxy was 

used in the FY 1997-based market 

basket. 

q. Machinery and Equipment 

The percentage change in the price of 

machinery and equipment as measured 

by the PPI (Commodity Code #11) is 

applied to this component. The same 

proxy was used in the FY 1997-based 

market basket. 

r. Miscellaneous Products 

The percentage change in the price of 

all finished goods less food and energy 

as measured by the PPI (Commodity 

Code #SOP3500) is applied to this 

component. Using this index removes 

the double-counting of food and energy 

prices, which are already captured 

elsewhere in the market basket. The 

same proxy was used in the FY 1997- 

based index. The weight for this cost 

category is higher than in the FY 1997- 

based index because the weight for 

blood and blood products (1.082) is 

added to it. In the FY 1997-based market 

basket, we included a separate cost 

category for blood and blood products, 

using the BLS PPI (Commodity Code 

#063711) for blood and derivatives as a 

price proxy. A review of recent trends 

in the PPI for blood and derivatives 

suggests that its movements may not be 

consistent with the trends in blood costs 

faced by hospitals. While this proxy did 

not match exactly with the product 

hospitals are buying, its trend over time 

appears to be reflective of the historical 

price changes of blood purchased by 

hospitals. However, an apparent 

divergence over recent periods led us to 

reevaluate whether the PPI for blood 

and derivatives was an appropriate 

measure of the changing price of blood. 

We ran test market baskets classifying 

blood in three separate cost categories: 

blood and blood products, contained 

within chemicals as was done for the FY 

1992-based index, and within 

miscellaneous products. These 

categories use as proxies the following 

PPIs: The PPI for blood and blood 

products, the PPI for chemicals, and the 

PPI for finished goods less food and 

energy, respectively. Of these three 

proxies, the PPI for finished goods less 

food and energy moved most like the 

recent blood cost and price trends. In 

addition, the impact on the overall 

market basket by using different proxies 

for blood was negligible, mostly due to 

the relatively small weight for blood in 

the market basket. Therefore, we chose 

the PPI for finished goods less food and 

energy for the blood proxy because we 

believe it will best be able to proxy price 

changes (not quantities or required tests) 

associated with blood purchased by 

hospitals. We will continue to evaluate 

this proxy for its appropriateness and 

will explore the development of 

alternative price indexes to proxy the 

price changes associated with this cost. 

s. Telephone 

The percentage change in the price of 

telephone services as measured by the 

CPI for all urban consumers (CPI Code 

# CUUR0000SEED) is applied to this 

component. The same proxy was used 

in the FY 1997-based market basket. 

t. Postage 

The percentage change in the price of 

postage as measured by the CPI for all 

urban consumers (CPI Code # 

CUUR0000SEEC01) is applied to this 

component. The same proxy was used 

in the FY 1997-based market basket. 

u. All Other Services: Labor Intensive 

The percentage change in the ECI for 

compensation paid to service workers 

employed in private industry is applied 

to this component. The same proxy was 

used in the FY 1997-based market 

basket. 

v. All Other Services: Nonlabor 

Intensive 

The percentage change in the allitems component of the CPI for all urban 

consumers (CPI Code # CUUR0000SA0) 

is applied to this component. The same 

proxy was used in the FY 1997-based 

market basket. 

For further discussion of the 

rationales for choosing many of the 

specific price proxies, we refer the 

reader to the August 1, 2002 final rule 

(67 FR 50037). 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23391 

3. Labor-Related Share 

(If you choose to comment on issues 

in this section, please include the 

caption ‘‘Labor-Related Share’’ at the 

beginning of your comment.) 

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

Act, the Secretary estimates from time to 

time the proportion of payments that are 

labor-related. ‘‘The Secretary shall adjust 

the proportion (as estimated by the 

Secretary from time to time) of 

hospitals’ costs which are attributable to 

wages and wage-related costs of the 

DRG prospective payment rates. * * *’’

We refer to the proportion of hospitals’

costs that are attributable to wages and 

wage-related costs as the ‘‘labor-related 

share.’’

The labor-related share is used to 

determine the proportion of the national 

PPS base payment rate to which the area 

wage index is applied. We are proposing 

to continue to use our current 

methodology of defining the laborrelated share as the national average 

proportion of operating costs that are 

related to, influenced by, or vary with 

the local labor markets. We believe that 

the operating cost categories that are 

related to, influenced by, or vary with 

the local labor markets are wages and 

salaries, fringe benefits, professional 

fees, contract labor, and labor intensive 

services. Therefore, we are proposing to 

calculate the labor-related share by 

adding the relative weights for these 

operating cost categories. After we 

reviewed all cost categories in the 

proposed IPPS market basket using this 

definition of labor-related, we removed 

postage costs from the proposed FY 

2002-based labor-related share because 

we no longer believe these costs are 

likely to vary with the local labor 

market. Using the cost category weights 

that we determined in section IV.B. of 

this preamble, we calculated a laborrelated share of 69.731 percent, using 

the FY 2002-based PPS market basket. 

Accordingly, we are proposing to 

implement a labor-related share of 69.7 

percent for discharges occurring on or 

after October 1, 2005. We note that 

section 403 of Pub. L. 108–173 amended 

sections 1886(d)(3)(E) and 

1886(d)(9)(C)(iv) of the Act to provide 

that the Secretary must employ 62 

percent as the labor-related share unless 

this employment ‘‘would result in lower 

payments than would otherwise be 

made.’’

We also are proposing an update to 

the labor-related share for Puerto Rico. 

Consistent with our methodology for 

determining the national labor-related 

share, we are proposing to add the 

Puerto Rico-specific relative weights for 

wages and salaries, fringe benefits, and 

contract labor. Because there are no 

Puerto Rico-specific relative weights for 

professional fees and labor intensive 

services, we are proposing to use the 

national weights. Alternatively, we 

could apply the national labor-related 

share to the Puerto Rico-specific rate. 

We note that we are still reviewing our 

data and have not yet calculated the 

updated Puerto Rico-specific laborrelated share percentage. Therefore, the 

labor-related and nonlabor-related 

portions of the Puerto Rico-specific 

standardized amount listed in Table 1C 

of the Addendum to this proposed rule 

reflect the current (FY 2005) laborrelated share for Puerto Rico of 71.3 

percent. Once we have calculated the 

updated labor-related share for Puerto 

Rico, we will post it on the CMS website 

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

hipps. In addition, if we adopt this 

proposal, we would publish the updated 

Puerto Rico labor-related share in the 

IPPS final rule. We welcome comments 

on our proposal to update the laborrelated share for Puerto Rico. 

Unlike the 1997 Annual I–O which 

was based on Standard Industrial Codes 

(SIC), the 1997 Benchmark I–O is 

categorized using the North American 

Industrial Classification System 

(NAICS). This change required us to 

classify all cost categories under NAICS, 

including a reevaluation of labor-related 

costs on the NAICS definitions. Chart 4 

compares the FY 1992-based laborrelated share, the current measure, with 

the FY 2002-based labor-related share. 

When we rebased the market basket to 


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reflect FY 1997 data, we did not change 

the labor-related share (67 FR 50041). 

Therefore, the FY 1992-based laborrelated share is the current measure. 

Although we are proposing to 

continue to calculate the labor-related 

share by adding the relative weights of 

the labor-related operating cost 

categories, we continue to evaluate 

alternative methodologies. In the May 9, 

2002 Federal Register (67 FR 31447), we 

discussed our research on the 

methodology for the labor-related share. 

This research involved analyzing the 

compensation share (the sum of wages 

and salaries and benefits) separately for 

urban and rural hospitals, using 

regression analysis to determine the 

proportion of costs influenced by the 

area wage index, and exploring 

alternative methodologies to determine 

whether all or only a portion of 

professional fees and nonlabor intensive 

services should be considered laborrelated. 

Our original analysis, which appeared 

in the May 9, 2002 Federal Register (67 

FR 31447) and which focused mainly on 

edited FY 1997 hospital data, found that 

the compensation share of costs for 

hospitals in rural areas was higher on 

average than the compensation share for 

hospitals in urban areas. We also 

researched whether only a proportion of 

the costs in professional fees and laborintensive services should be considered 

labor-related, not the entire cost 

categories. However, there was not 

enough information available to make 

this determination. 

Our finding that the average 

compensation share of costs for rural 

hospitals was higher than the average 

compensation for urban hospitals was 

validated consistently through our 

regression analysis. Regression analysis 

is a statistical technique that determines 

the relationship between a dependent 

variable and one or more independent 

variables. We tried several regression 

specifications in an effort to determine 

the proportion of costs that are 

influenced by the area wage index. 

Furthermore, MedPAC raised the 

possibility that regression may be an 

alternative to the current market basket 

methodology. Our initial regression 

specification (in log form) was Medicare 

operating cost per Medicare discharge as 

the dependent variable and the 

independent variables being the area 

wage index, the case-mix index, the 

ratio of residents per bed (as proxy for 

IME status), and a dummy variable that 

equals one if the hospital is located in 

a metropolitan area with a population of 

1 million or more. (A dummy variable 

represents the presence or absence of a 

particular characteristic.) This 

regression produced a coefficient for all 

hospitals for the area wage index of 

0.638 (which is equivalent to the labor 

share and can be interpreted as an 

elasticity because of the log 

specification) with an adjusted Rsquared of 64.3. (Adjusted R-squared is 

a measure of how well the regression 

model fits the data.) While, on the 

surface, this appeared to be a reasonable 

result, this same specification for urban 

hospitals had a coefficient of 0.532 

(adjusted R-squared = 53.2) and a 

coefficient of 0.709 (adjusted R-squared 

= 36.4) for rural hospitals. This 

highlighted some apparent problems 

with the specification because the 

overall regression results appear to be 

masking underlying problems. It did not 

seem reasonable that urban hospitals 

would have a labor share below their 

actual compensation share or that the 

discrepancy between urban and rural 

hospitals would be this large. When we 

standardized the Medicare operating 

cost per Medicare discharge for case 

mix, the fit, as measured by adjusted Rsquared, fell dramatically and the 

urban/rural discrepancy became even 

larger. 

Based on this initial result, we tried 

two modifications to the FY 1997 

regressions to correct for the underlying 

problems. First, we edited the data 

differently to determine if a few reports 

were causing the inconsistent results. 

We found when we tightened the edits, 

the wage index coefficient was lower 

and the fit was worse. When we 

loosened the edits, we found higher 

wage index coefficients and still a worse 

fit. Second, we added additional 

variables to the regression equation to 

attempt to explain some of the variation 

that was not being captured. We found 

the best fit occurred when the following 

variables were added: The occupancy 

rate, the number of hospital beds, a 

dummy variable that equals one if the 

hospital is privately owned and zero 

otherwise, a dummy variable that equals 

one if the hospital is governmentcontrolled and zero otherwise, the 

Medicare length-of-stay, the number of 

FTEs per bed, and the age of fixed 


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assets. The result of this specification 

was a wage index coefficient of 0.620 

(adjusted R-squared = 68.7), with the 

regression on rural hospitals having a 

coefficient of 0.772 (adjusted R-squared 

= 45.0) and the regression on urban 

hospitals having a coefficient of 0.474 

(adjusted R-squared = 60.9). Neither of 

these alternatives seemed to help the 

underlying difficulties with the 

regression analysis. 

Subsequent to the work described 

above, we have undertaken the research 

necessary to reevaluate the current 

assumptions used in determining the 

labor-related share. We ran regressions 

applying the previous specifications to 

more recent data (FY 2001 and FY 

2002), and, as described below, we ran 

regressions using alternative 

specifications. Once again we encourage 

comments on this research and any 

information that is available to help 

determine the most appropriate 

measure. 

The first step in our regression 

analysis to determine the proportion of 

hospitals’ costs that varied with laborrelated costs was to edit the data, which 

had significant outliers in some of the 

variables we used in the regressions. We 

originally began with an edit that 

excluded the top and bottom 5 percent 

of reports based on average Medicare 

cost per discharge and number of 

discharges. We also used edits to 

exclude reports that did not meet basic 

criteria for use, such as having costs 

greater than zero for total, operating, 

and capital for the overall facility and 

just the Medicare proportion. We also 

required that the hospital occupancy 

rate, length-of-stay, number of beds, 

FTEs, and overall and Medicare 

discharges be greater than zero. Finally, 

we excluded reports with occupancy 

rates greater than one. 

Our regression specification (in log 

form) was Medicare operating cost per 

Medicare discharge as the dependent 

variable (the same dependent variable 

we used in the regression analysis 

described in the May 9, 2002 Federal 

Register) with the independent 

variables being the compensation per 

FTE, the ratio of interns and residents 

per bed (as proxy for IME status), the 

occupancy rate, the number of hospital 

beds, a dummy variable that equals one 

if the hospital is privately owned and is 

zero otherwise, a dummy variable that 

equals one if the hospital is governmentcontrolled and is zero otherwise, the 

Medicare length-of-stay, the number of 

FTEs per bed, the age of fixed assets, 

and a dummy variable that equals one 

if the hospital is located in a 

metropolitan area with a population of 

1 million or more. This is a similar 

model to the one described in the May 

9, 2002 Federal Register (67 FR 31447) 

as having the best fit, with two notable 

exceptions. First, the area wage index is 

replaced by compensation per FTE, 

where compensation is the sum of 

hospital wages and salaries, contract 

labor costs, and benefits. The area wage 

index is a payment variable computed 

by averaging wages across all hospitals 

within each MSA, whereas 

compensation per FTE differs from one 

hospital to the next. Second, the casemix index is no longer included as a 

regressor because it is correlated with 

other independent variables in the 

regression. In other words, the other 

independent variables are capturing part 

of the effect of the case-mix index. We 

made these two specification changes in 

an attempt to only use cost variables to 

explain the variation in Medicare 

operating costs per discharge. We 

believe this is appropriate in order to 

compare to the results we are getting 

from the market basket methodology, 

which is based solely on cost data. As 

we will show below, the use of payment 

variables on the right-hand side of the 

equation appears to be producing less 

reasonable results when cost data are 

used. 

The revised specification for FY 2002 

produced a coefficient for all hospitals 

for compensation per FTE of 0.673 

(which is roughly equivalent to the 

labor share and can be interpreted as an 

elasticity because of the log 

specification) with an adjusted Rsquared of 63.7. The coefficient result 

for FY 2001 is 64.5, with an adjusted Rsquared of 65.2. (For comparison, a 

separate regression for FY 2002 with the 

log area wage index and log case-mix 

index included in the set of regressors 

displays a log area wage index 

coefficient of 75.6 (adjusted R-squared = 

67.7).) For FY 2001, the coefficient for 

the log area wage index is 72.3 (adjusted 

R-squared = 67.9). On the surface, these 

seem to be reasonable results. However, 

a closer look reveals some problems. In 

FY 2001, the coefficient for urban 

hospitals was 59.6 (adjusted R-squared 

= 57.3), and the coefficient for rural 

hospitals was 61.3 (adjusted R-squared 

= 50.6). On the other hand, in FY 2002, 

the coefficient for urban hospitals 

increased to 69.2 (adjusted R-squared = 

55.9), and the coefficient for rural 

hospitals decreased to 58.2 (adjusted R 

squared = 46.0). The results for FY 2001 

seem reasonable, but not when 

compared with the results for FY 2002. 

Furthermore, for FY 2002 the 

compensation share of costs for 

hospitals in rural areas was higher on 

average than the compensation share for 

hospitals in urban areas. Rural areas had 

an average compensation share of 63.3 

percent, while urban areas had a share 

of 60.5 percent. This compares to a 

share of 61.2 percent for all hospitals. 

Due to these problems, we do not 

believe the regression analysis is 

producing sound enough evidence at 

this point for us to make the decision to 

change from the current method for 

calculating the labor-related share. We 

continue to analyze these data and work 

on alternative specifications, including 

working with MedPAC, who in the past 

have done similar analysis in their 

studies of payment adequacy. 

Comments on this approach would be 

welcomed, given the difficulties we 

have encountered. 

We also continue to look into ways to 

refine our market basket approach to 

more accurately account for the 

proportion of costs influenced by the 

local labor market. Specifically, we are 

looking at the professional fees and 

labor-intensive cost categories to 

determine if only a proportion of the 

costs in these categories should be 

considered labor-related, not the entire 

cost category. Professional fees include 

management and consulting fees, legal 

services, accounting services, and 

engineering services. Labor-intensive 

services are mostly building services, 

but also include other maintenance and 

repair services. 

We conducted preliminary research 

into whether the various types of 

professional fees are more or less likely 

to be purchased in local labor markets. 

Through contact with a handful of 

hospitals in only two States, we asked 

for the percentages of their advertising, 

legal, and management and consulting 

services that they purchased in either 

local, regional, or national labor 

markets. The results were quite 

consistent across all of the hospitals, 

indicating most advertising and legal 

services are purchased in local or 

regional markets and nearly all 

management and consulting services are 

purchased in national labor markets. 

This suggested we may be appropriately 

reflecting advertising and legal services 

in the labor-related share, but we plan 

to investigate further whether 

management and consulting services are 

appropriately reflected. We do not 

believe that this limited effort produced 

enough evidence for us to change our 

methodology. However, we do plan to 

expand our efforts in this area to ensure 

we appropriately determine the laborrelated share. We are soliciting data or 

studies that would be helpful in this 

analysis. We are unsure if we will be 

able to finish this analysis in time for 

inclusion in the FY 2006 IPPS final rule. 

23394 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

As mentioned previously, we are 

proposing to continue to calculate the 

labor-related share by adding the 

relative weights of the operating cost 

categories that are related to, influenced 

by, or vary with the local labor markets. 

These categories include wages and 

salaries, fringe benefits, professional 

fees, contract labor and labor-intensive 

services. Since we no longer believe that 

postage costs meet our definition of 

labor-related, we are excluding them 

from the labor-related share. Using this 

methodology, we calculated a laborrelated share of 69.731. Therefore, we 

are proposing a labor-related share of 

69.731. 

C. Separate Market Basket for Hospitals 

and Hospital Units Excluded from the 

IPPS 

(If you choose to comment on issues 

in this section, please include the 

caption ‘‘Excluded Hospital Market 

Basket’’ at the beginning of your 

comment.) 

1. Hospitals Paid Based on Their 

Reasonable Costs 

On August 7, 2001, we published a 

final rule in the Federal Register (66 FR 

41316) establishing the PPS for IRFs, 

effective for cost reporting periods 

beginning on or after January 1, 2002. 

On August 30, 2002, we published a 

final rule in the Federal Register (67 FR 

55954) establishing the PPS for LTCHs, 

effective for cost reporting periods 

beginning on or after October 1, 2002. 

On November 15, 2004, we published a 

final rule in the Federal Register (69 FR 

66922) establishing the PPS for the IPFs, 

effective for cost reporting periods 

beginning on or after January 1, 2005. 

Prior to being paid under a PPS, IRFs, 

LTCHs, and IPFs were reimbursed 

solely under the reasonable cost-based 

system under § 413.40 of the 

regulations, which impose rate-ofincrease limits. Children’s and cancer 

hospitals and religious nonmedical 

health care institutions (RNHCIs) are 

still reimbursed solely under the 

reasonable cost-based system, subject to 

the rate-of-increase limits. 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-ofincrease percentages. To the extent a 

LTCH or IPF receives a blend of 

reasonable cost-based payment and the 

Federal prospective payment rate 

amount, the reasonable cost portion of 

the payment is also subject to the 

applicable rate-of-increase percentage. 

Section 1886(b)(3)(B)(ii) of the Act sets 

the percentage increase of the limits, 

which in certain years was based upon 

the market basket percentage increase. 

Beginning in FY 2003 and subsequent 

years, the applicable rate-of-increase is 

the market basket percentage increase. 

The market basket currently (and 

historically) used is the excluded 

hospital operating market basket, 

representing the cost structure of 

rehabilitation, long-term care, 

psychiatric, children’s, and cancer 

hospitals (FY 2003 final rule, 67 FR 

50042). 

Because IRFs, LTCHs, and some IPFs 

are now paid under a PPS, we are 

considering developing a separate 

market basket for these hospitals that 

contains both operating and capital 

costs. We would publish any proposal 

to use a revised separate market basket 

for each of these types of hospitals when 

we propose the nest update of their 

respective PPS rates. Children’s and 

cancer hospitals are two of the 

remaining three types of hospitals 

excluded from the IPPS that are still 

being paid based solely on their 

reasonable costs, subject to target 

amounts. (RNHCIs, the third type of 

IPPS-excluded entity still subject to 

target amounts, are reimbursed under 

§ 403.752(a) of the regulations.) Because 

there are a small number of children’s 

and cancer hospitals and RNHCIs, 

which receive in total less than 1 

percent of all Medicare payments to 

hospitals and because these hospitals 

provide limited Medicare cost report 

data, we are not proposing to create a 

separate market basket specifically for 

these hospitals. Under the broad 

authority in sections 1886(b)(3)(A) and 

(B), 1886(b)(3)(E), and 1871 of the Act, 

we are proposing to use the proposed 

FY 2002 IPPS operating market basket 

percentage increase to update the target 

amounts for children’s and cancer 

hospitals reimbursed under sections 

1886(b)(3)(A) and (b)(3)(E) of the Act 

and the market basket for RNHCIs under 

§ 403.752(a) of the regulations. This 

proposal reflects our belief that it is best 

to use an index that most closely 

represents the cost structure of 

children’s and cancer hospitals and 

RNHCIs. The FY 2002 cost weights for 

wages and salaries, professional 

liability, and ‘‘all other’’ for children’s 

and cancer hospitals are noticeably 

closer to those in the IPPS operating 

market basket than those in the 

excluded hospital market basket, which 

is based on the cost structure of IRFs, 

LTCHs, IPFs, and children’s and cancer 

hospitals and RNHCIs. Therefore, we 

believe it is more appropriate to use the 

IPPS operating market basket for 

children’s and cancer hospitals and 

RNHCIs. However, when we compare 

the weights for LTCHs and IPFs to the 

weights for IPPS hospitals, we did not 

find them comparable. Therefore, we do 

not believe it is appropriate to use the 

IPPS market basket for LTCHs and IPFs. 

For similar reasons, we are 

considering at some other date 

proposing a separate market basket to 

update the adjusted Federal payment 

amount for IRFs, LTCHs, and IPFs. We 

expect that these changes would be 

proposed in separate proposed rules for 

each of these three hospital types. We 

envision that these changes should 

apply to the adjusted Federal payment 

rate, and not the portion of the payment 

that is based on a facility-specific (or 

reasonable cost) payment to the extent 

such a hospital or unit is paid under a 

blend methodology. In other words, to 

the extent any of these hospitals are 

paid under a blend methodology 

whereby a percentage of the payment is 

based on reasonable cost principles, we 

would not propose to make changes to 

the existing methodology for developing 

the market basket for the reasonable cost 

portion of the payment because this 

portion of the payment is being phased 

out, if it is not already a nonexistent 

feature of the PPSs for IRFs, LTCHs, and 

IPFs. We do not believe that it makes 

sense to propose to create an entirely 

new methodology for creating the 

market basket index which updates the 

‘‘reasonable cost’’ portion of a blend 

methodology since the ‘‘reasonable cost 

portion’’ will last at most for just 1 or 

3 additional years (1 year for LTCHs 

paid under a blend methodology since 

LTCHs only have 1 year remaining in 

their transition, and 3 years for IPFs 

since IPFs paid under a blend 

methodology only have 3 years 

remaining under a blend methodology). 

However, the same cannot be said for 

the adjusted Federal payment amount. 

In the case of the IRF PPS, all IRFs are 

paid at 100 percent of the adjusted 

Federal payment amount and will 

continue to be paid based on 100 

percent of this amount for perpetuity. In 

the LTCH PPS, most LTCHs (98 percent) 

are already paid at 100 percent of the 

adjusted Federal payment amount. In 

the case of the few LTCHs that are paid 

under a blend methodology for cost 

reporting periods beginning on or after 

October 1, 2006, payment will be based 

entirely on the adjusted Federal 

prospective payment rate. In the case of 

IPFs, new IPFs (as defined in 

§ 412.426(c)) will be paid at 100 percent 

of the adjusted Federal prospective 

payment rate (the Federal per diem 

payment amount), while all others will 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23395 

continue to transition to 100 percent of 

the Federal per diem payment amount. 

In any event, even those transitioning 

will be at 100 percent of the adjusted 

Federal prospective payment rate in 3 

years. 

Chart 5 compares the updates for the 

FY 2002-based IPPS operating market 

basket, our proposed index used to 

update the target amounts for children’s 

and cancer hospitals, and RNHCIs, with 

a FY 2002-based excluded hospital 

market basket that is based on the 

current methodology (that is, based on 

the cost structure of IRFs, LTCHs, IPFs, 

and children’s and cancer hospitals). 

Although the percent change in the IPPS 

operating market basket is typically 

lower than the percent change in the FY 

2002-based excluded hospital market 

basket (see charts), we believe it is 

important to propose using the market 

basket that most closely reflects the cost 

structure of children’s and cancer 

hospitals. We invite comments on our 

proposal to use the proposed FY 2002 

IPPS operating market basket to update 

the target amounts for children’s and 

cancer hospitals reimbursed under 

sections 1886(b)(3)(A) and (b)(3)(E) of 

the Act and the market basket for 

RNHCIs under § 403.752(a) of the 

regulations. 

Chart 5 shows the historical and 

forecasted updates under both the 

proposed FY 2002-based IPPS operating 

market basket and the proposed FY 

2002-based excluded hospital market 

basket. The forecasts are based on 

Global Insight, Inc. 4th quarter, 2004 

forecast with historical data through the 

3rd quarter of 2004. Global Insight, Inc. 

is a nationally recognized economic and 

financial forecasting firm that contracts 

with CMS to forecast the components of 

the market baskets. 

2. Excluded Hospitals Paid Under a 

Blend Methodology 

As we discuss in greater detail in 

Appendix B to this proposed rule, in the 

past, hospitals and hospital units 

excluded from the IPPS have been paid 

based on their reasonable costs, subject 

to TEFRA limits. However, some of 

these categories of excluded hospitals 

and hospital units are now paid under 

their own PPSs. Specifically, some 

LTCHs and most IPFs are or will be 

transitioning from reasonable cost-based 

payments (subject to the TEFRA limits) 

to prospective payments under their 

respective PPSs. Under the respective 

transition period methodologies for the 

LTCH PPS and the IPF PPS, which are 

described below, payment is based, in 

part, on a decreasing percentage of the 

reasonable cost-based payment amount, 

which is subject to the TEFRA limits 

and an increasing percentage of the 

Federal prospective payment rate. For 

those LTCHs and IPFs whose PPS 

payment is comprised in part of a 

reasonable cost-based payment will 

have those reasonable cost-based 

payment amounts limited by the 

hospital’s TEFRA ceiling. 

Effective for cost reporting periods 

beginning on or after October 1, 2002, 

LTCHs are paid under the LTCH PPS, 


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which was implemented with a 5-year 

transition period, transitioning existing 

LTCHs to a payment based on the fully 

Federal prospective payment rate 

(August 30, 2002; 67 FR 55954). 

However, a LTCH may elect to be paid 

at 100 percent of the Federal 

prospective rate at the start of any of its 

cost reporting periods during the 5-year 

transition period. A ‘‘new’’ LTCH, as 

defined in § 412.23(e)(4), are paid based 

on 100 percent of the standard Federal 

rate. Effective for cost reporting periods 

beginning on or after January 1, 2005, 

IPFs are paid under the IPF PPS under 

which they receive payment based on a 

prospectively determined Federal per 

diem rate that is based on the sum of the 

average routine operating, ancillary, and 

capital costs for each patient day of 

psychiatric care in an IPF, adjusted for 

budget neutrality. During a 3-year 

transition period, existing IPFs are paid 

based on a blend of the reasonable costbased payments and the Federal 

prospective per diem base rate. For cost 

reporting periods beginning on or after 

January 1, 2008, existing IPFs are to be 

paid based on 100 percent of the Federal 

per diem rate. A ‘‘new’’ IPF, as defined 

in § 412.426(c), are paid based on 100 

percent of the Federal per diem 

payment amount. Any LTCHs or IPFs 

that receive a PPS payment that 

includes a reasonable cost-based 

payment during its respective transition 

period will have that portion of its 

payment subject to the TEFRA limits. 

Under the broad authority of section 

1886(b)(3)(A) and (b)(3)(B) of the Act, 

for LTCHs and IPFs that are 

transitioning to the fully Federal 

prospective payment rate, we are 

proposing to use the rebased FY 2002 

based-excluded hospital market basket 

to update the reasonable cost-based 

portion of their payments. The proposed 

market basket update is described in 

detail below. We do not believe the IPPS 

operating market basket should be used 

for the proposed update to the 

reasonable cost-based portion of the 

payments to LTCHs or IPFs because this 

market basket does not reflect the cost 

structure of LTCHs and IPFs. 

3. Development of Cost Categories and 

Weights for the Proposed FY 2002- 

Based Excluded Hospital Market Basket 

a. Medicare Cost Reports 

The major source of expenditure data 

for developing the proposed rebased 

and revised excluded hospital market 

basket cost weights is the FY 2002 

Medicare cost reports. We choose FY 

2002 as the base year because we 

believe this is the most recent, relatively 

complete year (with a 90-percent 

reporting rate) of Medicare cost report 

data. These cost reports are from 

rehabilitation, psychiatric, long-term 

care, children’s, cancer, and religious 

nonmedical excluded hospitals. They 

do not reflect data from IPPS hospitals 

or CAHs. These are the same hospitals 

included in the FY 1997-based excluded 

hospital market basket, except for 

religious nonmedical hospitals. Due to 

insufficient Medicare cost report data 

for these excluded hospitals, their cost 

reports yield only four major 

expenditure or cost categories: Wages 

and salaries, pharmaceuticals, 

professional liability insurance 

(malpractice), and a residual ‘‘all other.’’

Since the cost weights for the FY 

2002-based excluded hospital market 

basket are based on facility costs, we are 

proposing to use those cost reports for 

IRFs, LTCHs, and children’s, cancer, 

and RNHCIs whose Medicare average 

length of stay is within 15 percent (that 

is, 15 percent higher or lower) of the 

total facility average length of stay for 

the hospital. We are proposing to use a 

less stringent edit for Medicare length of 

stay for IPFs, requiring the average 

length of stay to be within 30 or 50 

percent (depending on the total facility 

average length of stay) of the total 

facility length of stay. This allows us to 

increase our sample size by over 150 

reports and produce a cost weight more 

consistent with the overall facility. The 

edit we applied to IPFs when 

developing the FY 1997-based excluded 

hospital market basket was based on the 

best available data at the time. 

We believe that limiting our sample to 

hospitals with a Medicare average 

length of stay within a comparable range 

of the total facility average length of stay 

provides a more accurate reflection of 

the structure of costs for Medicare 

treatments. Our method results in 

including in our data set hospitals with 

a share of Medicare patient days relative 

to total patient days that was 

approximately three times greater than 

for those hospitals excluded from our 

sample. Our goal is to measure cost 

shares that are reflective of case-mix and 

practice patterns associated with 

providing services to Medicare 

beneficiaries. 

Cost weights for benefits, contract 

labor and blood and blood products 

were derived using the proposed FY 

2002-based IPPS market basket. This is 

necessary because these data are poorly 

reported in the cost reports for non-IPPS 

hospitals. For example, the ratio of the 

benefit cost weight to the wages and 

salaries cost weight was applied to the 

proposed excluded hospital wages and 

salaries cost weight to derive a benefit 

cost weight for the proposed excluded 

hospital market basket. 


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b. Other Data Sources 

In addition to the Medicare cost 

reports, the other source of data used in 

developing the excluded hospital 

market basket weights is the Benchmark 

Input-Output Tables (I–Os) created by 

the Bureau of Economic Analysis, U.S. 

Department of Commerce. 

New data for this source are 

scheduled for publication every 5 years, 

but often take up to 7 years after the 

reference year. Only an Annual I–O is 

produced each year, but the Annual I–

O contains less industry detail than 

does the Benchmark I–O. When we 

rebased the excluded hospital market 

basket using FY 1997 data in the FY 

2003 IPPS final rule, the 1997 

Benchmark I–O was not yet available. 

Therefore, we did not incorporate data 

from that source into the FY 1997-based 

excluded hospital market basket (67 FR 

50033). However, we did use a 

secondary source the 1997 Annual 

Input-Output tables. The third source of 

data, the 1997 Business Expenditure 

Survey (now known as the Business 

Expenses Survey), was used to develop 

weights for the utilities and telephone 

services categories. 

The 1997 Benchmark I–O data are a 

much more comprehensive and 

complete set of data than the 1997 

Annual I–O estimates. The 1997 Annual 

I–O is an update of the 1992 I–O tables, 

while the 1997 Benchmark I–O is an 

entirely new set of numbers derived 

from the 1997 Economic Census. The 

2002 Benchmark Input-Output tables 

are not yet available. Therefore, we are 

proposing to use the 1997 Benchmark I–

O data in the proposed FY 2002-based 

excluded hospital market basket, to be 

effective for FY 2006. Instead of using 

the less detailed, less accurate Annual 

I–O data, we aged the 1997 Benchmark 

I–O data forward to FY 2002. The 

methodology we used to age the data 

involves applying the annual price 

changes from the price proxies to the 

appropriate cost categories. We repeat 

this practice for each year. 

The ‘‘all other’’ cost category is further 

divided into other hospital expenditure 

category shares using the 1997 

Benchmark Input-Output tables. 

Therefore, the ‘‘all other’’ cost category 

expenditure shares are proportional to 

their relationship to ‘‘all other’’ totals in 

the I–O tables. For instance, if the cost 

for telephone services were to represent 

10 percent of the sum of the ‘‘all other’’

I–O (see below) hospital expenditures, 

then telephone services would represent 

10 percent of the market basket’s ‘‘all 

other’’ cost category. The remaining 

detailed cost categories under the 

residual ‘‘all other’’ cost category were 

derived using the 1997 Benchmark 

Input-Output Tables aged to FY 2002 

using relative price changes. 

4. Proposed 2002–Based Excluded 

Hospital Market Basket—Selection of 

Price Proxies 

After computing the FY 2002 cost 

weights for the proposed rebased 

excluded hospital market basket, it is 

necessary to select appropriate wage 

and price proxies to reflect the rate-ofprice change for each expenditure 

category. With the exception of the 

Professional Liability proxy, all the 

indicators are based on Bureau of Labor 

Statistics (BLS) data and are grouped 

into one of the following BLS categories: 

• Producer Price Indexes—Producer 

Price Indexes (PPIs) measure price 

changes for goods sold in other than 

retail markets. PPIs are preferable price 

proxies for goods that hospitals 

purchase as inputs in producing their 

outputs because the PPIs would better 

reflect the prices faced by hospitals. For 

example, we use a special PPI for 

prescription drugs, rather than the 

Consumer Price Index (CPI) for 

prescription drugs because hospitals 

generally purchase drugs directly from 

the wholesaler. The PPIs that we use 

measure price change at the final stage 

of production. 

• Consumer Price Indexes—

Consumer Price Indexes (CPIs) measure 

change in the prices of final goods and 

services bought by the typical 

consumer. Because they may not 

represent the price faced by a producer, 

we used CPIs only if an appropriate PPI 

was not available, or if the expenditures 

were more similar to those of retail 

consumers in general rather than 

purchases at the wholesale level. For 

example, the CPI for food purchased 

away from home is used as a proxy for 

contracted food services. 

• Employment Cost Indexes—

Employment Cost Indexes (ECIs) 

measure the rate of change in employee 

wage rates and employer costs for 

employee benefits per hour worked. 

These indexes are fixed-weight indexes 

and strictly measure the change in wage 

rates and employee benefits per hour. 

Appropriately, they are not affected by 

shifts in employment mix. 

We evaluated the price proxies using 

the criteria of reliability, timeliness, 

availability, and relevance. Reliability 

indicates that the index is based on 

valid statistical methods and has low 

sampling variability. Timeliness implies 

that the proxy is published regularly, at 

least once a quarter. Availability means 

that the proxy is publicly available. 

Finally, relevance means that the proxy 

is applicable and representative of the 

cost category weight to which it is 

applied. The CPIs, PPIs, and ECIs 

selected meet these criteria and, 

therefore, we believe they continue to be 

the best measure of price changes for the 

cost categories to which they are 

applied. 

Chart 7 sets forth the complete 

proposed FY 2002-based excluded 

hospital market basket including cost 

categories, weights, and price proxies. 

For comparison purposes, the 

corresponding FY 1997-based excluded 

hospital market basket is listed as well. 

A summary outlining the choice of the 

various proxies follows the charts. 

BILLING CODE 4120–01–P 

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BILLING CODE 4120–01–C 

a. Wages and Salaries 

For measuring the price growth of 

wages in the proposed FY 2002-based 

excluded hospital market basket, we are 

proposing to use the ECI for wages and 

salaries for civilian hospital workers as 

the proxy for wages. This same proxy 

was used for the FY 1997-based 

excluded hospital market basket. 

b. Employee Benefits 

The proposed FY 2002-based 

excluded hospital market basket uses 

the ECI for employee benefits for 

civilian hospital workers. This is the 

same proxy that was used in the FY 

1997-based excluded hospital market 

basket. 

c. Nonmedical Professional Fees 

The ECI for compensation for 

professional and technical workers in 

private industry is applied to this 

category because it includes 

occupations such as management and 

consulting, legal, accounting and 

engineering services. The same proxy 

was used in the FY 1997-based 

excluded hospital market basket. 


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d. Fuel, Oil, and Gasoline 

The percentage change in the price of 

gas fuels as measured by the PPI 

(Commodity Code #0552) is applied to 

this component. The same proxy was 

used in the FY 1997-based excluded 

hospital market basket. 

e. Electricity 

The percentage change in the price of 

commercial electric power as measured 

by the PPI (Commodity Code #0542) is 

applied to this component. The same 

proxy was used in the FY 1997-based 

excluded hospital market basket. 

f. Water and Sewerage 

The percentage change in the price of 

water and sewerage maintenance as 

measured by the CPI for all urban 

consumers (CPI Code # 

CUUR0000SEHG01) is applied to this 

component. The same proxy was used 

in the FY 1997-based excluded hospital 

market basket. 

g. Professional Liability Insurance 

The proposed FY 2002-based 

excluded hospital market basket uses 

the percentage change in the hospital 

professional liability insurance (PLI) 

premiums as estimated by the CMS 

Hospital Professional Liability Index for 

the proxy of this category. Similar to the 

Physicians Professional Liability Index, 

we attempt to collect commercial 

insurance premiums for a fixed level of 

coverage, holding nonprice factors 

constant (such as a change in the level 

of coverage). In the FY 1997-based 

excluded hospital market basket, the 

same price proxy was used. 

We continue to research options for 

improving our proxy for professional 

liability insurance. This research 

includes exploring various options for 

expanding our current survey, including 

the identification of another entity that 

would be willing to work with us to 

collect more complete and 

comprehensive data. We are also 

exploring other options such as third 

party or industry data that might assist 

us in creating a more precise measure of 

PLI premiums. At this time, we have not 

yet identified a preferred option. 

Therefore, we are not proposing to make 

any changes to the proxy in this 

proposed rule. 

h. Pharmaceuticals 

The percentage change in the price of 

prescription drugs as measured by the 

PPI (PPI Code #PPI283D#RX) is used as 

a proxy for this category. This is a 

special index produced by BLS and is 

the same proxy used in the FY 1997- 

based excluded hospital market basket. 

i. Food: Direct Purchases 

The percentage change in the price of 

processed foods and feeds as measured 

by the PPI (Commodity Code #02) is 

applied to this component. The same 

proxy was used in the FY 1997-based 

excluded hospital market basket. 

j. Food: Contract Services 

The percentage change in the price of 

food purchased away from home as 

measured by the CPI for all urban 

consumers (CPI Code # 

CUUR0000SEFV) is applied to this 

component. The same proxy was used 

in the FY 1997-based excluded hospital 

market basket. 

k. Chemicals 

The percentage change in the price of 

industrial chemical products as 

measured by the PPI (Commodity Code 

#061) is applied to this component. 

While the chemicals hospitals purchase 

include industrial as well as other types 

of chemicals, the industrial chemicals 

component constitutes the largest 

proportion by far. Thus, we believe that 

Commodity Code #061 is the 

appropriate proxy. The same proxy was 

used in the FY 1997-based excluded 

hospital market basket. 

l. Medical Instruments 

The percentage change in the price of 

medical and surgical instruments as 

measured by the PPI (Commodity Code 

#1562) is applied to this component. 

The same proxy was used in the FY 

1997-based excluded hospital market 

basket. 

m. Photographic Supplies 

The percentage change in the price of 

photographic supplies as measured by 

the PPI (Commodity Code #1542) is 

applied to this component. The same 

proxy was used in the FY 1997-based 

excluded hospital market basket. 

n. Rubber and Plastics 

The percentage change in the price of 

rubber and plastic products as measured 

by the PPI (Commodity Code #07) is 

applied to this component. The same 

proxy was used in the FY 1997-based 

excluded hospital market basket. 

o. Paper Products 

The percentage change in the price of 

converted paper and paperboard 

products as measured by the PPI 

(Commodity Code #0915) is used. The 

same proxy was used in the FY 1997- 

based excluded hospital market basket. 

p. Apparel 

The percentage change in the price of 

apparel as measured by the PPI 

(Commodity Code #381) is applied to 

this component. The same proxy was 

used in the FY 1997-based excluded 

hospital market basket. 

q. Machinery and Equipment 

The percentage change in the price of 

machinery and equipment as measured 

by the PPI (Commodity Code #11) is 

applied to this component. The same 

proxy was used in the FY 1997-based 

excluded hospital market basket. 

r. Miscellaneous Products 

The percentage change in the price of 

all finished goods less food and energy 

as measured by the PPI (Commodity 

Code #SOP3500) is applied to this 

component. Using this index removes 

the double-counting of food and energy 

prices, which are already captured 

elsewhere in the market basket. The 

same proxy was used in the FY 1997- 

based excluded hospital market basket. 

The weight for this cost category is 

higher than in the FY 1997-based index 

because it also includes blood and blood 

products. In the FY 1997-based 

excluded hospital market basket, we 

included a separate cost category for 

blood and blood products, using the 

BLS PPI (Commodity Code #063711) for 

blood and derivatives as a price proxy. 

A review of recent trends in the PPI for 

blood and derivatives suggests that its 

movements may not be consistent with 

the trends in blood costs faced by 

hospitals. While this proxy did not 

match exactly with the product 

hospitals are buying, its trend over time 

appears to be reflective of the historical 

price changes of blood purchased by 

hospitals. However, an apparent 

divergence over recent periods led us to 

reevaluate whether the PPI for blood 

and derivatives was an appropriate 

measure of the changing price of blood. 

We ran test market baskets classifying 

blood in three separate cost categories: 

blood and blood products, contained 

within chemicals as was done for the FY 

1992-based index, and within 

miscellaneous products. These 

categories use as proxies the following 

PPIs: the PPI for blood and blood 

products, the PPI for chemicals, and the 

PPI for finished goods less food and 

energy, respectively. Of these three 

proxies, the PPI for finished goods less 

food and energy moved most like the 

recent blood cost and price trends. In 

addition, the impact on the overall 

market basket by using different proxies 

for blood was negligible, mostly due to 

the relatively small weight for blood in 

the market basket. Therefore, we chose 

the PPI for finished goods less food and 

energy for the blood proxy because we 

believe it will best be able to proxy price 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23401 

changes (not quantities or required tests) 

associated with blood purchased by 

hospitals. We will continue to evaluate 

this proxy for its appropriateness and 

will explore the development of 

alternative price indexes to proxy the 

price changes associated with this cost. 

s. Telephone 

The percentage change in the price of 

telephone services as measured by the 

CPI for all urban consumers (CPI Code 

#CUUR0000SEED) is applied to this 

component. The same proxy was used 

in the FY 1997-based excluded hospital 

market basket. 

t. Postage 

The percentage change in the price of 

postage as measured by the CPI for all 

urban consumers (CPI Code 

#CUUR0000SEEC01) is applied to this 

component. The same proxy was used 

in the FY 1997-based excluded hospital 

market basket. 

u. All Other Services: Labor Intensive 

The percentage change in the ECI for 

compensation paid to service workers 

employed in private industry is applied 

to this component. The same proxy was 

used in the FY 1997-based excluded 

hospital market basket. 

v. All Other Services: Nonlabor 

Intensive 

The percentage change in the allitems component of the CPI for all urban 

consumers (CPI Code #CUUR0000SA0) 

is applied to this component. The same 

proxy was used in the FY 1997-based 

excluded hospital market basket. 

For further discussion of the rationale 

for choosing many of the specific price 

proxies, we refer the reader to the 

August 1, 2002 final rule (67 FR 50037). 

D. Frequency of Updates of Weights in 

IPPS Hospital Market Basket 

Section 404 of Pub. L. 108–173 

(MMA) requires CMS to report in this 

proposed rule the research that has been 

done to determine a new frequency for 

rebasing the hospital market basket. 

Specifically, section 404 states: 

‘‘(a) More frequent updates in weights. 

After revising the weights used in the 

hospital market basket under section 

1886(b)(3)(B)(iii) of the Social Security 

Act (42 U.S.C. 1395ww(b)(3)(B)(iii)) to 

reflect the most current data available, 

the Secretary shall establish a frequency 

for revising such weights, including the 

labor share, in such market basket to 

reflect the most current data available 

more frequently than once every 5 years; 

and 

‘‘(b) Incorporation of explanation in 

rulemaking. The Secretary shall include 

in the publication of the final rule for 

payment for inpatient hospitals services 

under section 1886(d) of the Social 

Security Act (42 U.S.C. 1395ww(d)) for 

fiscal year 2006, an explanation of the 

reasons for, and options considered, in 

determining the frequency established 

under subsection (a).’’

This section of the proposed rule 

discusses the research we have done to 

fulfill this requirement, and proposes a 

rebasing frequency that makes optimal 

use of available data. 

Our past practice has been to monitor 

the appropriateness of the market basket 

on a consistent basis in order to rebase 

and revise the index when necessary. 

The decision to rebase and revise the 

index has been driven in large part by 

the availability of the data necessary to 

produce a complete index. In the past, 

we have supplemented the Medicare 

cost report data that are available on an 

annual basis with Bureau of the Census 

hospital expense data that are typically 

available only every 5 years (usually in 

years ending in 2 and 7). Because of 

this, we have generally rebased the 

index every 5 years. However, prior to 

the requirement associated with section 

404 of Pub. L. 108–173, there was no 

legislative requirement regarding the 

timing of rebasing the hospital market 

basket nor was there a hard rule that we 


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used in determining this frequency. 

ProPAC, one of MedPAC’s predecessor 

organizations, did a report to the 

Secretary on April 1, 1985, that 

supported periodic rebasing at least 

every 5 years. 

The most recent rebasing of the 

hospital market basket was just 3 years 

ago, for the FY 2003 update. Since its 

inception with the hospital PPS in FY 

1984, the hospital market basket has 

been rebased several times (FY 1987 

update, FY 1991 update, FY 1997 

update, FY 1998 update, and FY 2003 

update). One of the reasons we believe 

it appropriate to rebase the index on a 

periodic basis is that rebasing (as 

opposed to revising, as explained in 

section IV.A. of this preamble) tends to 

have only a minor impact on the actual 

percentage increase applied to the PPS 

update. There are two major reasons for 

this: (1) The cost category weights tend 

to be relatively stable over shorter term 

periods (3 to 5 years); and (2) the update 

is based on a forecast, which means the 

individual price series tend not to grow 

as differently as they have in some 

historical periods. 

We focused our research in two major 

areas. First, we reviewed the frequency 

and availability of the data needed to 

produce the market basket. Second, we 

analyzed the impact on the market 

basket of determining the market basket 

weights under various frequencies. We 

did this by developing market baskets 

that had base years for every year 

between 1997 and 2002, and then 

analyzed how different the market 

basket percent changes were over 

various periods. We used the results 

from these areas of research to assist in 

our determination of a new rebasing 

frequency. Based on this analysis, we 

are proposing to rebase the hospital 

market basket every 4 years. This would 

mean the next rebasing would occur for 

the FY 2010 update. 

As we have described in numerous 

Federal Register documents over the 

past few decades, the hospital market 

basket weights are the compilation of 

data from more than one data source. 

When we are discussing rebasing the 

weights in the hospital market basket, 

there are two major data sources: (1) The 

Medicare cost reports; and (2) expense 

surveys from the Bureau of the Census 

(the Economic Census is used to 

develop data for the Bureau of 

Economic Analysis’ input-output 

series). We will explore the future 

availability of each of these data 

sources. 

Each Medicare-participating hospital 

submits a Medicare cost report to CMS 

on an annual basis. It takes roughly 2 

years before ‘‘nearly complete’’ Medicare 

cost report data are available. For 

example, approximately 90 percent of 

FY 2002 Medicare cost report data were 

available in October 2004 (only 50 

percent of FY 2003 data was available), 

although only 20 percent of these 

reports were settled. We choose FY 2002 

as the base year because we believe this 

is the most recent, relatively complete 

year (with a 90 percent reporting rate) 

of Medicare cost report data. In 

developing the hospital market basket 

weights, we have used the Medicare 

cost reports to determine the weights for 

six major cost categories (wages, 

benefits, contract labor, 

pharmaceuticals, professional liability, 

and blood). In FY 2002, these six 

categories accounted for 68.5 percent of 

the hospital market basket. Therefore, it 

is possible to develop a new set of 

market basket weights for these 

categories on an annual basis, but with 

a substantial lag (for the FY 2006 

update, we consider the latest year of 

historical data to be FY 2002). 

The second source of data is the U.S. 

Department of Commerce, Bureau of 

Economic Analysis’ Benchmark InputOutput (I–O) table. These data are 

published every 5 years with a more 

significant lag than the Medicare cost 

reports. For example, the 1997 

Benchmark I–O tables were not 

published until the beginning of 2003. 

We have sometimes used data from a 

third data source, the Bureau of the 

Census’ Business Expenses Survey 

(BES), which is also published every 5 

years. The BES data are used as an input 

into the I–O data, and thus are 

published a few months prior to the 

release of the I–O. However, the BES 

contains only a fraction of the detail 

contained in the I–O. 

Chart 9 below takes into consideration 

the expected availability of these major 

data sources and summarizes how they 

could be incorporated into the 

development of future market basket 

weights. 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23403 

It would be necessary to age the I–O 

or BES data to the year for which cost 

report data are available using the price 

changes between those periods. While 

not a preferred method in developing 

the market basket weights, we have 

done this in the past when rebasing the 

index. We are proposing to age the 1997 

Benchmark I–O data for this proposed 

rule. 

As the table clearly indicates, the 

most optimal rebasing frequency from a 

data availability standpoint is every 5 

years. That is, if we were to next rebase 

for the FY 2011 update, we could use 

the 2002 Benchmark I–O data that 

would recently be available. In order to 

match the Medicare cost report data that 

would be available at that time (FY 2007 

data), we would have to age the I–O data 

to FY 2007. However, this would be 

aging the data only 5 years, whereas if 

the rebasing frequency was determined 

to be every 4 years, we would have to 

age 1997 I–O data to FY 2006. While 

aging data over 5 years is problematic 

(there can be significant utilization and 

intensity changes over that length 

period, as opposed to only a year or 

two), it would be significantly worse to 

age data over an 8-year or 9-year period. 

If we were on a 5-year rebasing 

frequency, for the FY 2016 update, we 

would use cost report data for FY 2012 

and the newly available 2007 I–O data. 

Again, the I–O data would have to be 

aged only 5 years to match the cost 

report data. 

We can look at the implications of 

determining a rebasing frequency of 

every 3 or 4 years. Considering a 

frequency of 3 years first, we would 

next rebase for the FY 2009 update 

using FY 2005 Medicare cost report data 

and 1997 I–O data (the same data 

currently being used in the proposed FY 

2002-based market basket). This is 

problematic because the 1997 I–O data 

would need to be aged 8 years to match 

the cost report data. The next two 

rebasings would be for the FY 2012 

update (using FY 2008 cost report data 

and 2002 I–O data) and FY 2015 (using 

FY 2011 cost report data and 2002 I–O 

data). This means that while we are 

making optimal use of the Medicare cost 

report data, we would be forced to use 

the same I–O data in consecutive 

rebasings and would have to age that 

data as much as 9 years to use the same 

year as the cost report data. 

For a rebasing frequency of every 4 

years, our next rebasing would be for 

the FY 2010 update using FY 2006 

Medicare cost report data and 1997 I–O 

data. This is also problematic because 

the 1997 I–O data would need to be 

aged 9 years to match the cost report 

data. The next two rebasings would be 

for the FY 2014 update (using FY 2010 

cost report data and 2002 I–O data) and 

FY 2018 (using FY 2014 cost report data 

and 2007 I–O data). Again, this 

frequency would make optimal use of 

the Medicare cost report data but would 

require aging of the I–O data between 7 

and 9 years in order to match the cost 

report data. 


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It is clear from this analysis that 

neither the 3-year nor 4-year rebasing 

frequencies makes as good use of all the 

data as rebasing every 5 years. In 

addition, when comparing the 3-year 

and 4-year rebasing frequencies, no one 

method stands out as being significantly 

improved over another. Thus, this 

analysis does not lead us to draw any 

definitive conclusions as to a rebasing 

frequency more appropriate than every 

5 years. 

Our second area of research in 

determining a new rebasing frequency 

was to analyze the impact on the market 

basket of determining the market basket 

weights under various frequencies. We 

did this by using the current historical 

data that are available (both Medicare 

cost report and I–O) to develop market 

baskets with base year weights for each 

year between FY 1997 and FY 2002. We 

then analyzed how differently the 

market baskets moved over various 

historical periods. 

Approaching the analysis this way 

allowed us to develop six hypothetical 

market baskets with different base years 

(FY 1997, FY 1998, FY 1999, FY 2000, 

FY 2001, and FY 2002). As we have 

done when developing the official 

market baskets, we used Medicare cost 

report data where available. Thus, cost 

report data were used to determine the 

weights for wages and salaries, benefits, 

contract labor, pharmaceuticals, blood 

and blood products, and all other costs. 

We used the 1997 Benchmark I–O data 

to fill out the remainder of the market 

basket weights (note that this produces 

a different index for FY 1997 than the 

official FY 1997-based hospital market 

basket that used the Annual 1997 I–O 

data), aging the data to the appropriate 

year to match the cost report data. This 

means the FY 2002-based index used in 

this analysis matches the FY 2002-based 

market basket we are proposing in this 

rule. Chart 10 shows the weights from 

these hypothetical market baskets: 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23405 

Note that the weights remain 

relatively stable between periods. It is 

for this reason that we believe defining 

the market basket as a Laspeyres-type, 

fixed-weight index is appropriate. 

Because the weights in the market 

basket are generally for aggregated costs 

(for example, wages and salaries for all 

employees), there is not much volatility 

in the weights between periods, 

especially over shorter time spans. As 

the results of this analysis will show, it 

is for this reason that rebasing the 

market basket more frequently than 

every 5 years is expected to have little 

impact on the overall percent change in 

the hospital market basket. 

Using these hypothetical market 

baskets, we can produce market basket 

percent changes over historical periods 

to determine what is the impact of using 

various base periods. In our analysis, we 

consider the hypothetical FY 1997- 

based index to be the benchmark 

measure and the other indexes to 

indicate the impact of rebasing over 

various frequencies. The hypothetical 

FY 2000-based index would reflect the 

impact of rebasing every 3 years, the 

hypothetical FY 2001-based index 

would reflect the impact of rebasing 

every 4 years, and the hypothetical FY 

2002-based index would reflect the 


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impact of rebasing every 5 years. Chart 11 shows the results of these 

comparisons. 

It is clear from this comparison that 

there is little difference between the 

indexes, and, for some FYs, there would 

be no difference in the market basket 

update factor if we had rebased the 

market basket more frequently. In 

particular, there is no difference in the 

hypothetical indexes based between FY 

2000 and FY 2002. This suggests that 

setting the rebasing frequency to 3, 4, or 

5 years will have little or no impact on 

the resulting market basket. As we 

found when analyzing data availability, 

this portion of our research does not 

suggest that rebasing the market basket 

more frequently than every 5 years 

results in an improved market basket or 

that there is any noticeable difference 

between rebasing every 3 or 4 years. 

Market basket rebasing is a 1-year to 

2-year long process that includes data 

processing, analytical work, 

methodology reevaluation, and 

regulatory process. After developing a 

rebased and revised market basket, there 

are extensive internal review processes 

that a rule must undergo, both in 

proposed and final form. Once the 

proposed rule has been published, there 

is a 60-day comment period set aside for 

the public to respond to the proposed 

rule. After comments are received, we 

then need adequate time to research and 

reply to all comments submitted. The 

last part of the regulatory process is the 

60-day requirement—the final rule must 

be published 60 days before the 

provisions of the rule can become 

effective. 

We would like to rebase all of our 

indexes (PPS operating, PPS capital, 

excluded hospital with capital, SNFs, 

HHAs, and Medicare Economic Index) 

on a regular schedule. Therefore, if we 

were to choose a 3-year rebasing 

schedule, we would have to rebase more 

than one index at a time. This may 

potentially limit the amount of time we 

could devote to the market basket 

rebasing process. In addition, we 

recognize that, in the future, we may be 

required to develop additional market 

baskets that would require frequent 

rebasing. 

Given the number of market baskets 

we are responsible for rebasing and 

revising, the regulatory process for each, 

and the availability of source data, we 

believe that while it is not necessary, 

rebasing and revising the hospital 

market baskets every 4 years is the most 

appropriate frequency to meet the 

legislative requirement. 

E. Capital Input Price Index Section 

The Capital Input Price Index (CIPI) 

was originally described in the 

September 1, 1992 Federal Register (57 

FR 40016). There have been subsequent 

discussions of the CIPI presented in the 

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), 

September 1, 1995 (60 FR 45815), May 

31, 1996 (61 FR 27466), and August 30, 

1996 (61 FR 46196) issues of the Federal 

Register. The August 1, 2002 (67 FR 

50032) rule discussed the most recent 

revision and rebasing of the CIPI to a FY 

1997 base year, which reflects the 

capital cost structure facing hospitals in 

that year. 

We are proposing to revise and rebase 

the CIPI to a FY 2002 base year to reflect 

the more recent structure of capital costs 

in hospitals. Unlike the PPS operating 

market basket, we do not have FY 2002 

Medicare cost report data available for 

the development of the capital cost 

weights, due to a change in the FY 2002 

cost reporting requirements. Rather, we 

used hospital capital expenditure data 

for the capital cost categories of 

depreciation, interest, and other capital 

expenses for FY 2001 and aged these 

data to a FY 2002 base year using the 

relevant vintage-weighted price proxies. 

As with the FY 1997-based index, we 

have developed two sets of weights in 

order to calculate the proposed FY 

2002-based CIPI. The first set of 

proposed weights identifies the 

proportion of hospital capital 

expenditures attributable to each 

expenditure category, while the second 

set of proposed weights is a set of 

relative vintage weights for depreciation 


EP04MY05.044</GPH>
Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23407 

and interest. The set of vintage weights 

is used to identify the proportion of 

capital expenditures within a cost 

category that is attributable to each year 

over the useful life of the capital assets 

in that category. A more thorough 

discussion of vintage weights is 

provided later in this section. 

Both sets of proposed weights are 

developed using the best data sources 

available. In reviewing source data, we 

determined that the Medicare cost 

reports provided accurate data for all 

capital expenditure cost categories. We 

are proposing to use the FY 2001 

Medicare cost reports for PPS hospitals, 

aged to FY 2002, excluding expenses 

from hospital-based subproviders, to 

determine weights for all three cost 

categories: depreciation, interest, and 

other capital expenses. We compared 

the weights determined from the 

Medicare cost reports to the 2002 

Bureau of the Census’ Business 

Expenses Survey and found the weights 

to be similar to those developed from 

the Medicare cost reports. 

Lease expenses are not broken out as 

a separate cost category in the CIPI, but 

are distributed among the cost 

categories of depreciation, interest, and 

other, reflecting the assumption that the 

underlying cost structure of leases is 

similar to capital costs in general. As 

was done in previous rebasings of the 

CIPI, we assumed 10 percent of lease 

expenses are overhead and assigned 

them to the other capital expenses cost 

category as overhead. The remaining 

lease expenses were distributed to the 

three cost categories based on the 

proportion of depreciation, interest, and 

other capital expenses to total capital 

costs excluding lease expenses. 

Depreciation contains two 

subcategories: building and fixed 

equipment and movable equipment. The 

split between building and fixed 

equipment and movable equipment was 

determined using the Medicare cost 

reports. This methodology was also 

used to compute the FY 1997-based 

index. 

Total interest expense cost category is 

split between government/nonprofit and 

profit interest. The FY 1997-based CIPI 

allocated 85 percent of the total interest 

cost weight to government/nonprofit 

interest, proxied by average yield on 

domestic municipal bonds, and 15 

percent to for-profit interest, proxied by 

average yield on Moody’s Aaa bonds (67 

FR 50044). The methodology used to 

derive this split is explained in the June 

2, 1995 issue of the Federal Register (60 

FR 29233). We are proposing to derive 

the split using the relative FY 2001 

Medicare cost report data on interest 

expenses for government/nonprofit and 

profit hospitals. Based on these data, we 

are proposing a 75/25 split between 

government/nonprofit and profit 

interest. We believe it is important that 

this split reflects the latest relative cost 

structure of interest expenses. The 

proposed split of 75/25 had little (less 

than 0.1 percent in any given year) or 

no effect on the annual capital market 

basket percent change in both the 

historical and forecasted periods. 

Chart 12 presents a comparison of the 

proposed FY 2002-based CIPI capital 

cost weights and the FY 1997-based CIPI 

capital cost weights. 


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23408 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

Because capital is acquired and paid 

for over time, capital expenses in any 

given year are determined by both past 

and present purchases of physical and 

financial capital. The vintage-weighted 

CIPI is intended to capture the longterm consumption of capital, using 

vintage weights for depreciation 

(physical capital) and interest (financial 

capital). These vintage weights reflect 

the proportion of capital purchases 

attributable to each year of the expected 

life of building and fixed equipment, 

movable equipment, and interest. We 

used the vintage weights to compute 

vintage-weighted price changes 

associated with depreciation and 

interest expense. 

Vintage weights are an integral part of 

the CIPI. Capital costs are inherently 

complicated and are determined by 

complex capital purchasing decisions, 

over time, based on such factors as 

interest rates and debt financing. In 

addition, capital is depreciated over 

time instead of being consumed in the 

same period it is purchased. The CIPI 

accurately reflects the annual price 

changes associated with capital costs, 

and is a useful simplification of the 

actual capital investment process. By 

accounting for the vintage nature of 

capital, we are able to provide an 

accurate, stable annual measure of price 

changes. Annual nonvintage price 

changes for capital are unstable due to 

the volatility of interest rate changes 

and, therefore, do not reflect the actual 

annual price changes for Medicare 

capital-related costs. CMS’ CIPI reflects 

the underlying stability of the capital 

acquisition process and provides 

hospitals with the ability to plan for 

changes in capital payments. 

To calculate the vintage weights for 

depreciation and interest expenses, we 

needed a time series of capital 

purchases for building and fixed 

equipment and movable equipment. We 

found no single source that provides the 

best time series of capital purchases by 

hospitals for all of the above 

components of capital purchases. The 

early Medicare cost reports did not have 

sufficient capital data to meet this need. 

While the AHA Panel Survey provided 

a consistent database back to 1963, it 

did not provide annual capital 

purchases. The AHA Panel Survey 

provided a time series of depreciation 

expenses through 1997 which could be 

used to infer capital purchases over 

time. From 1998 to 2001, hospital 

depreciation expenses were calculated 

by multiplying the AHA Annual Survey 

total hospital expenses by the ratio of 

depreciation to total hospital expenses 

from the Medicare cost reports. 

Beginning in 2001, the AHA Annual 

Survey began collecting depreciation 

expenses. We hope to be able to use 

these data in future rebasings. 

In order to estimate capital purchases 

from AHA data on depreciation 

expenses, the expected life for each cost 

category (building and fixed equipment, 

movable equipment, and interest) is 

needed to calculate vintage weights. We 

used FY 2001 Medicare cost reports to 

determine the expected life of building 

and fixed equipment and movable 

equipment. The expected life of any 

piece of equipment can be determined 

by dividing the value of the asset 

(excluding fully depreciated assets) by 

its current year depreciation amount. 

This calculation yields the estimated 

useful life of an asset if depreciation 

were to continue at current year levels, 

assuming straight-line depreciation. 

From the FY 2001 cost reports, the 

expected life of building and fixed 

equipment was determined to be 23 

years, and the expected life of movable 

equipment was determined to be 11 

years. The FY 1997-based CIPI showed 

the same expected life for the two 

categories of depreciation. 

Although we are proposing to use this 

methodology for deriving the useful life 

of an asset, we intend to conduct a 

further review of the methodology 

between the publication of this 

proposed rule and the final rule. We 

plan to review alternate data sources, if 

available, and analyze in more detail the 

hospital’s capital cost structure reported 

in the Medicare cost reports. 

We are proposing to use the building 

and fixed equipment and movable 

equipment weights derived from FY 

2001 Medicare cost reports to separate 

the depreciation expenses into annual 

amounts of building and fixed 

equipment depreciation and movable 

equipment depreciation. Year-end asset 

costs for building and fixed equipment 

and movable equipment were 

determined by multiplying the annual 

depreciation amounts by the expected 

life calculations from the FY 2001 

Medicare cost reports. We then 

calculated a time series back to 1963 of 

annual capital purchases by subtracting 

the previous year asset costs from the 

current year asset costs. From this 

capital purchase time series, we were 

able to calculate the vintage weights for 

building and fixed equipment and 

movable equipment. Each of these sets 

of vintage weights is explained in detail 

below. 

For building and fixed equipment 

vintage weights, the real annual capital 

purchase amounts for building and 

fixed equipment derived from the AHA 

Panel Survey were used. The real 

annual purchase amount was used to 

capture the actual amount of the 

physical acquisition, net of the effect of 

price inflation. This real annual 

purchase amount for building and fixed 

equipment was produced by deflating 

the nominal annual purchase amount by 

the building and fixed equipment price 

proxy, the Boeckh Institutional 

Construction Index. Because building 

and fixed equipment have an expected 

life of 23 years, the vintage weights for 

building and fixed equipment are 

deemed to represent the average 

purchase pattern of building and fixed 

equipment over 23-year periods. With 

real building and fixed equipment 

purchase estimates available back to 

1963, we averaged sixteen 23-year 

periods to determine the average vintage 

weights for building and fixed 

equipment that are representative of 

average building and fixed equipment 

purchase patterns over time. Vintage 

weights for each 23-year period are 

calculated by dividing the real building 

and fixed capital purchase amount in 

any given year by the total amount of 

purchases in the 23-year period. This 

calculation is done for each year in the 

23-year period, and for each of the 

sixteen 23-year periods. We are 

proposing to use the average of each 

year across the sixteen 23-year periods 

to determine the 2002 average building 

and fixed equipment vintage weights for 

the FY 2002-based CIPI. 

For movable equipment vintage 

weights, the real annual capital 

purchase amounts for movable 

equipment derived from the AHA Panel 

Survey were used to capture the actual 

amount of the physical acquisition, net 

of price inflation. This real annual 

purchase amount for movable 

equipment was calculated by deflating 

the nominal annual purchase amount by 

the movable equipment price proxy, the 

PPI for Machinery and Equipment. 

Based on our determination that 

movable equipment has an expected life 

of 11 years, the vintage weights for 

movable equipment represent the 

average expenditure for movable 

equipment over an 11-year period. With 

real movable equipment purchase 

estimates available back to 1963, 

twenty-eight 11-year periods were 

averaged to determine the average 

vintage weights for movable equipment 

that are representative of average 

movable equipment purchase patterns 

over time. Vintage weights for each 11- 

year period are calculated by dividing 

the real movable capital purchase 

amount for any given year by the total 

amount of purchases in the 11-year 

period. This calculation was done for 

each year in the 11-year period, and for 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23409 

each of the twenty-eight 11-year 

periods. We are proposing to use the 

average of each year across the twentyeight 11-year periods to determine the 

average movable equipment vintage 

weights for the FY 2002-based CIPI. 

For interest vintage weights, the 

nominal annual capital purchase 

amounts for total equipment (building 

and fixed, and movable) derived from 

the AHA Panel and Annual Surveys 

were used. Nominal annual purchase 

amounts were used to capture the value 

of the debt instrument. Because we have 

determined that hospital debt 

instruments have an expected life of 23 

years, the vintage weights for interest 

are deemed to represent the average 

purchase pattern of total equipment 

over 23-year periods. With nominal total 

equipment purchase estimates available 

back to 1963, sixteen 23-year periods 

were averaged to determine the average 

vintage weights for interest that are 

representative of average capital 

purchase patterns over time. Vintage 

weights for each 23-year period are 

calculated by dividing the nominal total 

capital purchase amount for any given 

year by the total amount of purchases in 

the 23-year period. This calculation is 

done for each year in the 23-year period 

and for each of the sixteen 23-year 

periods. We are proposing to use the 

average of each year across the sixteen 

23-year periods to determine the average 

interest vintage weights for the FY 2002- 

based CIPI. The vintage weights for the 

FY 1997 CIPI and the proposed FY 2002 

CIPI are presented in Chart 13. 

After the capital cost category weights 

were computed, it was necessary to 

select appropriate price proxies to 

reflect the rate of increase for each 

expenditure category. Our proposed 

price proxies for the FY 2002-based CIPI 

are the same as those used in the FY 

1997-based CIPI. We still believe these 

are the most appropriate proxies for 


EP04MY05.046</GPH>
23410 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

hospital capital costs that meet our 

selection criteria of relevance, 

timeliness, availability, and reliability. 

We ran the proposed FY 2002-based 

index using the Moody’s Aaa bonds 

average yield and then using the 

Moody’s Baa bonds average yield as 

proxy for the for-profit interest cost 

category. There was no difference in the 

two sets of index percent changes either 

historically or forecasted. The rationale 

for selecting these price proxies is 

explained more fully in the August 30, 

1996 final rule (61 FR 46196). The 

proposed proxies are presented in Chart 

14. 

Global Insight, Inc. forecasts a 0.7 

percent increase in the FY 2002-based 

CIPI for 2006, as shown in Chart 15. 

This is the result of a 1.3 percent 

increase in projected depreciation prices 

(building and fixed equipment, and 

movable equipment) and a 2.7 percent 

increase in other capital expense prices, 

partially offset by a 2.3 percent decrease 

in vintage-weighted interest rates in FY 

2006, as indicated in Chart 15. 

Accordingly, we are proposing a 0.7 

percent increase in the CIPI. 


EP04MY05.047</GPH>
Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23411 

Rebasing the CIPI from FY 1997 to FY 

2002 decreased the percent change in 

the FY 2006 forecast by 0.1 percentage 

point, from 0.8 to 0.7, as shown in Chart 

12. The difference is caused mostly by 

changes in the relationships between 

the cost category weights within 

depreciation and interest. The fixed 

depreciation cost weight relative to the 

movable depreciation cost weight and 

the nonprofit/government interest cost 

weight relative to the for-profit interest 

cost weight are both less in the FY 2002- 

based CIPI. The changes in these 

relationships have a small effect on the 

FY 2002-based CIPI percent changes. 

However, when added together, they are 

responsible for a negative one-tenth 

percentage point difference between the 

FY 2002-based CIPI and the FY 1997- 

based CIPI. 

V. Other Decisions and Proposed 

Changes to the IPPS for Operating Costs 

and GME Costs 

A. Postacute Care Transfer Payment 

Policy (§ 412.4) 

(If you choose to comment on issues 

in this section, please include the 

caption ‘‘Postacute Care Transfers’’ at 

the beginning of your comment.) 

1. Background 

Existing regulations at § 412.4(a) 

define discharges under the IPPS as 

situations in which a patient is formally 

released from an acute care hospital or 

dies in the hospital. Section 412.4(b) 

defines transfers from one acute care 

hospital to another, and § 412.4(c) 

defines transfers to certain postacute 

care providers. Our policy provides that, 

in transfer situations, full payment is 

made to the final discharging hospital 

and each transferring hospital is paid a 

per diem rate for each day of the stay, 

not to exceed the full DRG payment that 

would have been made if the patient 

had been discharged without being 

transferred. 

The per diem rate paid to a 

transferring hospital is calculated by 

dividing the full DRG payment by the 

geometric mean length of stay for the 

DRG. Based on an analysis that showed 

that the first day of hospitalization is the 

most expensive (60 FR 45804), our 

policy provides for payment that is 

double the per diem amount for the first 

day (§ 412.4(f)(1)). Transfer cases are 

also eligible for outlier payments. The 

outlier threshold for transfer cases is 

equal to the fixed-loss outlier threshold 

for nontransfer cases, divided by the 

geometric mean length of stay for the 

DRG, multiplied by the length of stay for 

the case, plus one day. The purpose of 

the IPPS transfer payment policy is to 

avoid providing an incentive for a 

hospital to transfer patients to another 

hospital early in the patients’ stay in 

order to minimize costs while still 

receiving the full DRG payment. The 

transfer policy adjusts the payments to 

approximate the reduced costs of 

transfer cases. 

2. Changes to DRGs Subject to the 

Postacute Care Transfer Policy 

(§§ 412.4(c) and (d)) 

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

provides that, effective for discharges on 

or after October 1, 1998, a ‘‘qualified 

discharge’’ from one of 10 DRGs 

selected by the Secretary to a postacute 

care provider would be treated as a 

transfer case. This section required the 

Secretary to define and pay as transfers 

all cases assigned to one of 10 DRGs 

selected by the Secretary, if the 


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individuals are discharged to one of the 

following postacute care settings: 

• A hospital or hospital unit that is 

not a subsection 1886(d) hospital. 

(Section 1886(d)(1)(B) of the Act 

identifies the hospitals and hospital 

units that are excluded from the term 

‘‘subsection (d) hospital’’ as psychiatric 

hospitals and units, rehabilitation 

hospitals and units, children’s hospitals, 

long-term care hospitals, and cancer 

hospitals.) 

• A SNF (as defined at section 

1819(a) of the Act). 

• Home health services provided by a 

home health agency, if the services 

relate to the condition or diagnosis for 

which the individual received inpatient 

hospital services, and if the home health 

services are provided within an 

appropriate period (as determined by 

the Secretary). 

In the July 31, 1998 IPPS final rule (63 

FR 40975 through 40976), we specified 

that a patient discharged to home would 

be considered transferred to postacute 

care if the patient received home health 

services within 3 days after the date of 

discharge. In addition, in the July 31, 

1998 final rule, we did not include 

patients transferred to a swing-bed for 

skilled nursing care in the definition of 

postacute care transfer cases (63 FR 

40977). 

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

directed the Secretary to select 10 DRGs 

based upon a high volume of discharges 

to postacute care and a disproportionate 

use of postacute care services. As 

discussed in the July 31, 1998 final rule, 

these 10 DRGs were selected in 1998 

based on the MedPAR data from FY 

1996. Using that information, we 

identified and selected the first 20 DRGs 

that had the largest proportion of 

discharges to postacute care (and at least 

14,000 such transfer cases). In order to 

select 10 DRGs from the 20 DRGs on our 

list, we considered the volume and 

percentage of discharges to postacute 

care that occurred before the mean 

length of stay and whether the 

discharges occurring early in the stay 

were more likely to receive postacute 

care. We identified 10 DRGs to be 

subject to the postacute care transfer 

rule starting in FY 1999. 

Section 1886(d)(5)(J)(iv) of the Act 

authorizes the Secretary to expand the 

postacute care transfer policy for FY 

2001 or subsequent fiscal years to 

additional DRGs based on a high 

volume of discharges to postacute care 

facilities and a disproportionate use of 

postacute care services. In the FY 2004 

IPPS final rule (68 FR 45412), we 

expanded the postacute care transfer 

policy to include additional DRGs. We 

established the following criteria that a 

DRG must meet, for both of the 2 most 

recent years for which data are 

available, in order to be included under 

the postacute care transfer policy: 

• At least 14,000 postacute care 

transfer cases; 

• At least 10 percent of its postacute 

care transfers occurring before the 

geometric mean length of stay; 

• A geometric mean length of stay of 

at least 3 days; and 

• If a DRG is not already included in 

the policy, a decline in its geometric 

mean length of stay during the most 

recent 5-year period of at least 7 

percent. 

In the FY 2004 IPPS final rule, we 

identified 21 new DRGs that met these 

criteria. We also determined that one 

DRG from the original group of 10 DRGs 

(DRG 263) no longer met the volume 

criterion of 14,000 transfer cases. 

Therefore, we removed DRGs 263 and 

264 (DRG 264 is paired with DRG 263) 

from the policy and expanded the 

postacute care transfer policy to include 

payments for transfer cases in the new 

21 DRGs, effective October 1, 2003. As 

a result, a total of 29 DRGs were subject 

to the postacute care transfer policy in 

FY 2004. In the FY 2004 IPPS final rule, 

we indicated that we would review and 

update this list periodically to assess 

whether additional DRGs should be 

added or existing DRGs should be 

removed (68 FR 45413). 

For FY 2005, we analyzed the 

available data from the FY 2003 

MedPAR file. For the 2 most recent 

years of available data (FY 2002 and FY 

2003), we found that no additional 

DRGs qualified under the four criteria 

set forth in the IPPS final rule for FY 

2004. We also analyzed the DRGs 

included under the policy for FY 2004 

to determine if they still met the criteria 

to remain under the policy. In addition, 

we analyzed the special circumstances 

arising from a change to one of the DRGs 

included under the policy in FY 2004. 

In the FY 2005 IPPS final rule (69 FR 

48942), we deleted DRG 483 

(Tracheostomy With Mechanical 

Ventilation 96+ Hours or Principal 

Diagnosis Except Face, Mouth, and 

Neck Diagnosis) and established the 

following new DRGs as replacements: 

DRG 541 (Tracheostomy With 

Mechanical Ventilation 96+ Hours or 

Principal Diagnosis Except Face, Mouth 

and Neck Diagnoses With Major O.R. 

Procedure) and DRG 542 (Tracheostomy 

with Mechanical Ventilation 96+ Hours 

or Principal Diagnosis Except Face, 

Mouth and Neck Diagnoses Without 

Major O.R. Procedure). Cases in the 

existing DRG 483 were assigned to the 

new DRGs 541 and 542 based on the 

presence or absence of a major O.R. 

procedure, in addition to the 

tracheostomy code that was previously 

required for assignment to DRG 483. 

Specifically, if the patient’s case 

involves a major O.R. procedure (a 

procedure whose code is included on 

the list that is assigned to DRG 468 

(Extensive O.R. Procedure Unrelated to 

Principal Diagnosis), except for 

tracheostomy codes 31.21 and 31.29), 

the case is assigned to the DRG 541. If 

the patient does not have an additional 

major O.R. procedure (that is, if there is 

only a tracheostomy code assigned to 

the case), the case is assigned to DRG 

542. 

Based on data analysis, we 

determined that neither DRG 541 nor 

DRG 542 would have enough cases to 

meet the existing threshold of 14,000 

transfer cases for inclusion in the 

postacute care transfer policy. 

Nevertheless, we believed the cases that 

would be incorporated into these two 

DRGs remained appropriate candidates 

for application of the postacute care 

transfer policy and that the subdivision 

of DRG 483 should not change the 

original application of the postacute 

care transfer policy to the cases once 

included in that DRG. Therefore, for FY 

2005, we proposed alternate criteria to 

be applied in cases where DRGs do not 

satisfy the existing criteria, for 

discharges occurring on or after October 

1, 2004 (69 FR 28273 and 28374). The 

proposed new criteria were designed to 

address situations such as those posed 

by the split of DRG 483, where there 

remain substantial grounds for inclusion 

of cases within the postacute care 

transfer policy, although one or more of 

the original criteria may no longer 

apply. Under the proposed alternate 

criteria, DRGs 430, 541, and 542 would 

have qualified for inclusion in the 

postacute care transfer policy. 

In the response to comments on our 

FY 2005 proposal, we decided not to 

adopt the proposed alternate criteria for 

including DRGs under the postacute 

care transfer policy in the FY 2005 IPPS 

final rule. Instead we adopted the policy 

of simply grandfathering, for a period of 

2 years, any cases that were previously 

included within a DRG that has split, 

when the split DRG qualified for 

inclusion in the postacute care transfer 

policy for both of the previous 2 years. 

Under this policy, the cases that were 

previously assigned to DRG 483 and that 

now fall into DRGs 541 and 542 

continue to be subject to the policy. 

Therefore, effective for discharges on or 

after October 1, 2004, 30 DRGs, 

including new DRGs 541 and 542, are 

subject to the postacute care transfer 

policy. We indicated that we would 

monitor the frequency with which these 

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cases are transferred to postacute care 

settings and the percentage of these 

cases that are short-stay transfer cases. 

Because we did not adopt the proposed 

alternate criteria for DRG inclusion in 

the postacute care transfer policy, DRG 

430 (Psychoses) did not meet the criteria 

for inclusion and has not been subject 

to the postacute care transfer policy for 

FY 2005. We also invited comments on 

how to treat the cases formerly included 

in a split DRG after the grandfathering 

period. 

We note that some commenters also 

suggested that, in place of the proposed 

alternate criteria, we should adopt a 

policy of permanently applying the 

postacute care transfer policy to a DRG 

once it has initially qualified for 

inclusion in the policy. These 

commenters noted that removing DRGs 

from the postacute care transfer policy 

makes the payment system less stable 

and results in inconsistent incentives 

over time. They also argued that ‘‘a drop 

in the number of transfers to postacute 

care settings is to be expected after the 

transfer policy is applied to a DRG, but 

the frequency of transfers may well rise 

again if the DRG is removed from the 

policy.’’ We indicated that we would 

consider adopting this general policy 

once we had evaluated the experience 

with the specific cases that are subject 

to the grandfathering policy for FY 2005 

and FY 2006. 

In the May 18, 2004 proposed rule, we 

also called attention to the data 

concerning DRG 263, which was subject 

to the postacute care transfer policy 

until FY 2004. We removed DRG 263 

from the postacute care transfer policy 

for FY 2004 because it did not have the 

minimum number of cases (14,000) 

transferred to postacute care (13,588 

transfer cases in FY 2002, with more 

than 50 percent of transfer cases being 

short-stay transfers). The FY 2003 

MedPAR data show that there were 

15,602 transfer cases in the DRG in FY 

2003, of which 46 percent were shortstay transfers. Because we removed the 

DRG from the postacute care transfer 

policy in FY 2004, it must meet all 

criteria to be included under the policy 

in subsequent fiscal years. Because the 

geometric mean length of stay for DRG 

263 showed only a 6-percent decrease 

since 1999, DRG 263 did not qualify to 

be added to the policy for FY 2005 

under the existing criteria that were 

included in last year’s rule. DRG 263 

would have qualified under the volume 

threshold and percent of short-stay 

transfer cases under the proposed new 

alternate criteria contained in the FY 

2005 proposed rule. However, it still 

would not have met the proposed 

required decline in length of stay to 

qualify to be added to the policy for FY 

2005. We indicated that we would 

continue to monitor the experience with 

DRG 263, especially in light of the 

comment that recommended a general 

policy of grandfathering cases that 

qualify under the criteria for inclusion 

in the postacute care transfer policy. 

The table below displays the 30 DRGs 

that are included in the postacute care 

transfer policy, effective for discharges 

occurring on or after October 1, 2004. 

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For this year’s proposed rule, we have 

conducted an extensive analysis of the 

FY 2003 and FY 2004 MedPAR data to 

monitor the effects of the postacute care 

transfer policy. We have also conducted 

an overall assessment of the postacute 

care transfer policy since its inception 

in FY 1999. Specifically, we have 

examined the relationship between rates 

of postacute care utilization and the 

geometric mean length of stay and the 

relationship between a high volume and 

a high proportion of postacute care 

transfers within a DRG in light of 

experience under the current policy. 

Specifically, we examined whether a 

decline in the geometric mean length of 

stay is associated with an increase in the 

volume and proportion of total cases in 

a DRG that are discharges to postacute 

care. We analyzed these data as part of 

determining whether to retain the 

criteria that a DRG must have a decline 

in the geometric mean length of stay of 


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at least 7 percent in the previous 5-year 

period to be included under the 

postacute care transfer policy. 

Our current criteria for inclusion in 

the postacute care transfer policy 

include a requirement that, if a DRG is 

not already included in the policy, there 

must be a decline of at least 7 percent 

in the DRG’s geometric mean length of 

stay during the most recent 5-year 

period. It has come to our attention that 

not all DRGs that experience an increase 

in postacute care utilization also 

experience a decrease in geometric 

mean length of stay. In fact, some DRGs 

with increases in postacute care 

utilization during the past several years 

have also experienced an increase in the 

geometric mean length of stay. The table 

below lists a number of DRGs that 

experienced increases in postacute care 

utilization and increases in the 

geometric mean length of stay from FY 

2002 through FY 2004: 

Our current criteria also include a 

requirement that a DRG have at least 

14,000 total postacute care transfer cases 

in order to be included in the policy. 

We have examined the data on the 

numbers of transfers and the percentage 

of postacute care transfer cases across 

DRGs. Among the 30 DRGs currently 

included within the postacute care 

transfer policy, the percentage of 

postacute care transfer cases ranges from 

a low of 15 percent to a high of 76 

percent. Among DRGs that are not 

currently included within the policy, 

many have a relatively high percentage 

of postacute care transfer cases in 

proportion to the total volume of cases 

for the DRG or a relatively high volume 

of discharges to postacute care facilities, 

or both. For this reason, we reviewed 

the data for all DRGs before proposing 

a change to the postacute care transfer 

payment policy. As part of this review, 

we found that: 

• Of 550 DRGs, 26 have been 

deactivated and 17 have no cases in the 

FY 2004 MedPAR files. We are not 

proposing any changes for these DRGs 

because application of the postacute 

care transfer policy to them would have 

no effect. 

• Of the remaining 507 DRGs, 220 

have geometric mean lengths of stay that 

are less than 3.0 days. Because the 

transfer payment policy provides 2 

times the per diem rate for the first day 

of care (due to the large proportion of 

charges incurred on the first day of a 

patient’s treatment), including these 

DRGs in the transfer policy would be 

relatively meaningless as they would all 

receive a full DRG payment. For this 

reason, we are not proposing any 


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changes to the postacute care transfer 

policy for these DRGs. 

• Of the remaining 287 DRGs, 64 have 

fewer than 100 short-stay transfer cases. 

In addition, 39 of these 64 DRGs have 

fewer than 50 short-stay transfer cases. 

Consistent with the statutory guidance, 

we are not proposing any change to how 

we apply the postacute care transfer 

payment policy to these DRGs because 

we believe that these DRGs do not have 

a high volume of discharges to postacute 

care facilities or involve a 

disproportionate use of postacute care 

services. 

Once we eliminated the DRGs cited 

above from consideration for the 

postacute care transfer policy, we 

examined the characteristics of the 

remaining 223 DRGs. We found that 

these DRGs had three common 

characteristics: 

• The DRG had at least 2,000 total 

postacute care transfer cases. 

• At least 20 percent of all cases in 

the DRG were discharged to postacute 

care settings. 

• 10 percent of all discharges to 

postacute care were prior to the 

geometric mean length of stay for the 

DRG. 

Consistent with the statutory 

guidance giving the Secretary the 

authority to make a DRG subject to the 

postacute care transfer policy based on 

a high volume of discharges to postacute 

care facilities and a disproportionate use 

of postacute care services, we believe 

these DRGs have characteristics that 

make them appropriate for inclusion in 

the postacute care transfer policy. 

As a result of our analysis, we believe 

that it is appropriate to consider major 

revisions to the criteria for including a 

DRG within the postacute care transfer 

policy. First, our analysis calls into 

question the requirement that a DRG 

experience a decline in the geometric 

mean length of stay over the most recent 

5-year period. Our findings that some 

DRGs with increases in postacute care 

utilization during the past several years 

have also experienced increases in 

geometric mean length of stay indicate 

that this criterion is no longer effective 

to identify those DRGs that should be 

subject to the postacute care transfer 

policy. In addition, our findings about 

the number of DRGs with relatively high 

volumes (at least 2,000 cases) and 

relatively high proportions (at least 20 

percent) of postacute care utilization 

suggest that we should revise the 

requirement that a DRG have at least 

14,000 total postacute care transfer cases 

to be included within the postacute care 

transfer policy. 

Our analysis does confirm that it is 

appropriate to maintain the requirement 

that a DRG must have a geometric mean 

length of stay of at least 3.0 days in 

order to be included within the 

postacute care transfer policy. We 

believe that this policy should be 

retained because, under the transfer 

payment methodology, hospitals receive 

the entire payment for cases in these 

DRGs in the first 2 days of the stay. 

Lowering the limit below 3.0 days 

would, therefore, have no effect on 

payment for DRGs with geometric mean 

lengths-of-stay in this range. For the 

reasons discussed in the May 19, 2003 

proposed rule (68 FR 27199) and 

because it is a common characteristic of 

DRGs with a large number of cases 

discharged to postacute care, we also 

continue to believe that it is appropriate 

to retain the criterion that at least 10 

percent of all cases that are transferred 

to postacure care should be short-stay 

cases where the patient is transferred 

before the geometric mean length of stay 

for the DRG. We also continue to believe 

that both DRGs in a CC/non-CC pair 

should be subject to the postacute care 

transfer policy if one of the DRGs meets 

the criteria for inclusion. By including 

both DRGs in a CC/non-CC pair, our 

policy will preclude an incentive for 

hospitals to code cases in ways designed 

to avoid triggering the application of the 

policy, for example, by excluding codes 

that would identify a complicating or 

comorbid condition in order to assign a 

case to a non-CC DRG that is not subject 

to the policy. 

Therefore, we are considering 

substantial revisions to the four criteria 

that are currently used to determine 

whether a DRG qualifies for inclusion in 

the postacute care transfer policy. The 

current criteria provide that, in order to 

be included within the policy, a DRG 

must have, for both of the 2 most recent 

years for which data are available: 

• At least 14,000 total postacute care 

transfer cases; 

• At least 10 percent of its postacute 

care transfers occurring before the 

geometric mean length of stay; 

• A geometric mean length of stay of 

at least 3 days; 

• If a DRG is not already included in 

the policy, a decline in its geometric 

mean length of stay during the most 

recent 5-year period of at least 7 

percent; and 

• If the DRG is one of a paired set of 

DRGs based on the presence or absence 

of a comorbidity or complication, both 

paired DRGs are included if either one 

meets the first three criteria above. 

As a result of our analysis, we 

considered two options for revising the 

current criteria. Option 1 is to include 

all DRGs within the postacute care 

transfer policy. This option has the 

advantage of providing consistent 

treatment of all DRGs. However, as we 

discussed above, our analysis tends to 

indicate that, at a minimum, it may be 

appropriate to maintain the requirement 

that a DRG must have a geometric mean 

length of stay of at least 3.0 days 

because, under the transfer payment 

methodology, hospitals receive the 

entire payment for these DRGs in the 

first 2 days of the stay. Lowering the 

limit below 3.0 days, would therefore 

have little or no effect on payment for 

DRGs with geometric mean lengths of 

stay in this range. 

Option 2 that we considered is to 

expand the application of the postacute 

care transfer policy by applying the 

policy to any DRG that meets the 

following criteria: 

• The DRG has at least 2,000 

postacute care transfer cases; 

• At least 20 percent of the cases in 

the DRG are discharged to postacute 

care; 

• Out of the cases discharged to 

postacute care, at least 10 percent occur 

before the geometric mean length of stay 

for the DRG;. 

• The DRG has a geometric mean 

length of stay of at least 3.0 days; 

• If the DRG is one of a paired set of 

DRGs based on the presence or absence 

of a comorbidity or complication, both 

paired DRGs are included if either one 

meets the first three criteria above. 

Option 2 would expand the 

application of the postacute care 

transfer policy to 223 DRGs that have 

both a relatively high volume and a 

relatively high proportion of postacute 

care utilization. The proposed change 

would also avoid applying the postacute 

care transfer policy to DRGs with only 

a small number or proportion of cases 

transferred to postacute care. The table 

below shows the DRGs that would be 

included in the postacute care transfer 

policy under this option: 

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We believe that the analysis that we 

have conducted suggest that substantial 

revisions to the criteria for including a 

DRG within the postacute care transfer 

policy are warranted. In this proposed 

rule, we are formally proposing Option 

2 as presented above. However, we 

invite comments on both of these 

options and on the analysis that we 

have presented. 

The impact section in Appendix A of 

this proposed rule discusses our 

findings on the effects of adopting 

Option 2. The proposed DRG relative 

weights included in Tables 5 and 7 of 

the Addendum to this proposed rule 

also include the effect of changing the 

postacute care transfer policy as 

described in Option 2 above. We note 

that if we adopt either option discussed 

above, or a variation based on comments 

submitted, we would follow procedures 

similar to those that are currently 

followed for treating cases identified as 

transfers in the DRG recalibration 

process. That is, as described in the 

discussion of DRG recalibration in 

section II.C. of the preamble to this 

proposed rule, additional transfer cases 

would be counted as a fraction of a case 

based on the ratio of a hospital’s transfer 

payment under the per diem payment 

methodology to the full DRG payment 

for nontransfer cases. 

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

recognizes that, in some cases, a 

substantial portion of the cost of care is 

incurred in the early days of the 

inpatient stay. Similar to the policy for 


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transfers between two acute care 

hospitals, transferring hospitals receive 

twice the per diem rate for the first day 

of treatment and the per diem rate for 

each following day of the stay before the 

transfer, up to the full DRG payment, for 

cases discharged to postacute care. 

However, three of the DRGs subject to 

the postacute care transfer policy 

exhibit an even higher share of costs 

very early in the hospital stay in 

postacute care transfer situations. For 

these DRGs, hospitals receive 50 percent 

of the full DRG payment plus the single 

per diem (rather than double the per 

diem) for the first day of the stay and 

50 percent of the per diem for the 

remaining days of the stay, up to the full 

DRG payment. 

In previous years, we determined that 

DRGs 209 and 211 met this cost 

threshold and qualified to receive this 

special payment methodology. Because 

DRG 210 is paired with DRG 211, we 

include payment for cases in that DRG 

for the same reason we include paired 

DRGs in the postacute care transfer 

policy (to eliminate any incentive to 

code incorrectly in order to receive 

higher payment for those cases). The FY 

2004 MedPAR data show that DRGs 209 

and 211 continue to have charges on the 

first day of the stay that are higher than 

50 percent of the average charges in the 

DRGs. In addition, several of the DRGs 

that may be added to the postacute care 

transfer policy under the options that 

we are considering may also meet the 50 

percent threshold in their average 

charges. We have identified those 

additional DRGs that are subject to the 

special payment methodology in Tables 

5 and 7 of the Addendum to this 

proposed rule. 

B. Reporting of Hospital Quality Data 

for Annual Hospital Payment Update 

(§ 412.64(d)(2)) 

(If you choose to comment on issues 

in this section, please include the 

caption ‘‘Hospital Quality Data’’ at the 

beginning of your document.) 

1. Background 

Section 1886(b)(3)(B)(vii) of the Act, 

as added by section 501(b) of Pub. L. 

108–173 revised the mechanism used to 

update the standardized amount of 

payment for inpatient hospital operating 

costs. Specifically, the statute provides 

for a reduction of 0.4 percentage points 

to the update percentage increase (also 

known as the market basket update) for 

each of FYs 2005 through 2007 for any 

‘‘subsection (d) hospital’’ that does not 

submit data on a set of 10 quality 

indicators established by the Secretary 

as of November 1, 2003. The statute also 

provides that any reduction will apply 

only to the fiscal year involved, and will 

not be taken into account in computing 

the applicable percentage increase for a 

subsequent fiscal year. This measure 

establishes an incentive for IPPS 

hospitals to submit data on the quality 

measures established by the Secretary. 

We initially implemented section 

1886(b)(3)(B)(vii) of the Act in the FY 

2005 IPPS final rule (August 11, 2004, 

69 FR 49078) in continuity with the 

Department’s Hospital Quality Initiative 

as described at the CMS Web site: 

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

hospitals. At a press conference on 

December 12, 2002, the Secretary of the 

Department of Health and Human 

Services (HHS) announced a series of 

steps that HHS and its collaborators 

were taking to promote public reporting 

of hospital quality information. These 

collaborators include the American 

Hospital Association, the Federation of 

American Hospitals, the Association of 

American Medical Colleges, the Joint 

Commission on Accreditation of 

Healthcare Organizations (JCAHO), the 

National Quality Forum, the American 

Medical Association, the ConsumerPurchaser Disclosure Project, the 

American Association of Retired 

Persons, the American Federation of 

Labor-Congress of Industrial 

Organizations, the Agency for 

Healthcare Research and Quality, as 

well as CMS, Quality Improvement 

Organizations (QIOs), and others. 

In July 2003, CMS began the National 

Voluntary Hospital Reporting Initiative 

(NVHRI), now known as the Hospital 

Quality Alliance (HQA): Improving Care 

through Information. Data from this 

initiative have been used to populate a 

professional Web site providing data to 

healthcare professionals. This website 

will be followed by the development of 

a consumer Web site in an easy-to-use 

format. The consumer Web site is 

intended to be an important tool for 

individuals to use in making decisions 

about health care options. This 

information will assist beneficiaries by 

providing comparison information for 

consumers who need to select a 

hospital. It will also serve as a way to 

encourage accountability of hospitals for 

the care they provide to patients. 

The 10 measures that were employed 

in this voluntary initiative as of 

November 1, 2003, are: 

• Heart Attack (Acute Myocardial Infarction) 

Was aspirin given to the patient upon 

arrival to the hospital? 

Was aspirin prescribed when the patient 

was discharged? 

Was a beta-blocker given to the patient 

upon arrival to the hospital? 

Was a beta-blocker prescribed when the 

patient was discharged? 

Was an ACE inhibitor given for the patient 

with heart failure? 

• Heart failure 

Did the patient get an assessment of his or 

her heart function? 

Was an ACE inhibitor given to the patient? 

• Pneumonia 

Was an antibiotic given to the patient in a 

timely way? 

Had a patient received a pneumococcal 

vaccination? 

Was the patient’s oxygen level assessed? 

These measures have been endorsed 

by the National Quality Forum (NQF) 

and are a subset of the same measures 

currently collected for the JCAHO by its 

accredited hospitals. The Secretary 

adopted collection of data on these 10 

quality measures in order to: (1) provide 

useful and valid information about 

hospital quality to the public; (2) 

provide hospitals with a sense of 

predictability about public reporting 

expectations; (3) begin to standardize 

data and data collection mechanisms; 

and (4) foster hospital quality 

improvement. Many hospitals are 

currently participating in the National 

Voluntary Hospital Reporting Initiative 

(NVHRI), and are submitting data to the 

QIO Clinical Warehouse for that 

purpose. 

Over the next several years, hospitals 

are encouraged to take steps toward the 

adoption of electronic medical records 

(EMRs) that will allow for reporting of 

clinical quality data from the electronic 

record directly to a CMS data repository. 

CMS intends to begin working toward 

creating measures specifications and a 

system or mechanism, or both, that will 

accept the data directly without 

requiring the transfer of the raw data 

into an XML file as currently exists. The 

Department is presently working 

cooperatively with other Federal 

agencies in the development of Federal 

health architecture data standards. CMS 

encourages hospitals that are developing 

systems to conform them to both 

industry standards and the Federal 

health architecture data standards, and 

to ensure that they would capture the 

data necessary for quality measures. 

Ideally, such systems will also provide 

point-of-care decision support that 

enables high levels of performance on 

the measures. Hospitals using EMRs to 

produce data on quality measures will 

be held to the same performance 

expectations as hospitals not using 

EMRs. We are exploring requirements 

for the submission of electronically 

produced data and other options to 

encourage the submission of such data, 

and invite comments on this issue. 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23425 

2. Requirements for Hospital Reporting 

of Quality Data 

The procedures for participating in 

the Reporting Hospital Quality Data for 

the Annual Payment Update 

(RHQDAPU) program created in 

accordance with section 501(b) of Pub. 

L. 108–173 can be found on the 

QualityNet Exchange at the Web site: 

http://www.qnetexchange.org in the 

‘‘Reporting Hospital Quality Data for 

Annual Payment Update Reference 

Checklist’’. This checklist also contains 

all of the forms to be completed by 

hospitals participating in the program. 

In order to participate in the hospital 

reporting initiative, hospitals must 

follow these steps: 

• The hospital must identify a 

QualityNet Exchange Administrator 

who follows the registration process and 

submits the information through the 

QIO. This must be done regardless of 

whether the hospital uses a vendor for 

transmission of data. 

• All participants must first register 

with the QualityNet Exchange, 

regardless of the method used for data 

submission. If a hospital is currently 

participating in the voluntary reporting 

initiative, re-registration on QualityNet 

Exchange is unnecessary. However, the 

hospital must complete the Reporting 

Hospital Quality Data for Annual 

Payment Update Notice of Participation 

form. All hospitals must send this form 

to their QIOs. 

• The hospital must collect data for 

all 10 measures and submit the data to 

the QIO Clinical Warehouse either using 

the CMS Abstraction & Reporting Tool 

(CART), the JCAHO Oryx Core Measures 

Performance Measurement System 

(PMS), or another third-party vendor 

that has met the measurement 

specification requirements for data 

transmission to QualityNet Exchange. 

The QIO Clinical Warehouse will 

submit the data to CMS on behalf of the 

hospitals. The submission will be done 

through QualityNet Exchange, which is 

a secure site that voluntarily meets or 

exceeds all current Health Insurance 

Portability and Accountability Act 

(HIPAA) requirements, while 

maintaining QIO confidentiality as 

required under the relevant regulations 

and statutes. The information in the 

Clinical Warehouse is considered QIO 

data and, therefore, is subject to the 

stringent QIO confidentiality regulations 

in 42 CFR Part 480. 

For the first year of the program, FY 

2005, hospitals were required to begin 

the submission of data by July 1, 2004, 

under the provisions of section 

1886(b)(3)(B)(vii)(II) of the Act, as added 

by section 501(b) of Pub. L. 108–173. 

Because section 501(b) of Pub. L. 108–

173 granted a 30-day grace period for 

submission of data for purposes of the 

FY 2005 update, hospitals were given 

until August 1, 2004, for completed 

submissions to be successfully accepted 

into the QIO Clinical Warehouse. 

Hospitals were required to submit data 

for the first calendar quarter of 2004. We 

received data from over 98 percent of 

the eligible hospitals. 

For FY 2006, we are proposing that 

hospitals must continuously submit the 

required 10 measures each quarter 

according to the schedule found on the 

Web site at http:// 

www.qnetexchange.org. New facilities 

must submit the data using the same 

schedule, as dictated by the quarter they 

begin discharging patients. We will 

expect that all hospitals will have 

submitted data to the QIO Clinical 

Warehouse for discharges through the 

fourth quarter of calendar year 2004 

(October to December 2004). Hospitals 

have 41⁄2 months from the end of the 

fourth quarter until the closing of the 

warehouse (from December 31, 2004, 

until May 15, 2005) to make sure there 

are no errors in the submitted data. The 

warehouse is closed at that time in order 

to draw the validation sample and to 

begin preparing the public file for 

Hospital Compare public reporting. Data 

from fourth quarter 2004 discharges 

(October through December 2004) will 

be the last quarter of data with a 

submission deadline (May 15, 2005) that 

precedes our deadline for certifying the 

hospitals eligible to receive the full 

update for FY 2006. As we required for 

FY 2005, the data for each quarter must 

be submitted on time and pass all of the 

edits and consistency checks required in 

the clinical warehouse. Hospitals that 

do not treat a condition or have very few 

discharges will not be penalized and 

will receive the full annual payment 

update if they submit all the data they 

do possess. 

New hospitals should begin collecting 

and reporting data immediately and 

complete the registration requirements 

for the RHQDAPU. New hospitals will 

be held to the same standard as 

established facilities when determining 

the expected number of discharges for 

the calendar quarters covered for each 

fiscal year. The annual payment updates 

would be based on the successful 

submission of data to CMS via the QIO 

Clinical Warehouse by the established 

deadlines. 

For FY 2005, hospitals could 

withdraw from RHQDAPU at any time 

up to August 1, 2004. Hospitals 

withdrawing from the program did not 

receive the full market basket update 

and, instead, received a reduction of 0.4 

percentage points in their update. By 

law, a hospital’s actions each year will 

not affect its update in a subsequent 

year. Therefore, a hospital must meet 

the requirements for RHQDAPU each 

year the program is in effect. Failure of 

a hospital to receive the full update in 

one year does not affect its update in a 

succeeding year. 

For the first year, FY 2005, there were 

no chart-audit validation criteria in 

place. Based upon our experience from 

the FY 2005 submissions, and upon our 

requirement for reliable and valid data, 

we are proposing to place the following 

additional requirements on hospitals for 

the data for the FY 2006 payment 

update. These requirements, as well as 

additional information on validation 

requirements, will be placed on 

QualityNet Exchange. 

• The hospital must have passed our 

validation requirement of a minimum of 

80 percent reliability, based upon our 

chart-audit validation process, for the 

third quarter data of calendar year 2004 

in order to receive the full market basket 

update in FY 2006. These data were due 

to the clinical warehouse by February 

15, 2005. We will use appropriate 

confidence intervals to determine if a 

hospital has achieved an 80-percent 

reliability. The use of confidence 

intervals will allow us to establish an 

appropriate range below the 80-percent 

reliability threshold that will 

demonstrate a sufficient level of validity 

to allow the data to still be considered 

valid. We will estimate the percent 

reliability based upon a review of five 

charts and then calculate the upper 95 

percent confidence limit for that 

estimate. If this upper limit is above the 

required 80 percent, the hospital data 

will be considered validated. We are 

proposing to use the design specific 

estimate of the variance for the 

confidence interval calculation, which, 

in this case, is a single stage cluster 

sample, with unequal cluster sizes. (For 

reference, see Cochran, William G. 

(1977) Sampling Techniques, John 

Wiley & Sons, New York, chapter 3, 

section 3.12.) 

We will use a two-step process to 

determine if a hospital is submitting 

valid data. At the first step, we will 

calculate the percent agreement for all 

of the variables submitted in all of the 

charts, whether or not they are related 

to the 10 measures. If a hospital falls 

below the 80 percent cutoff, we will 

then restrict the comparison to those 

variables associated with the 10 

measures required under section 501(b) 

of Pub. L. 108–173. We will recalculate 

the percent agreement and the estimated 

95 percent confidence interval and 

again compare to the 80 percent cutoff 

23426 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

point. If a hospital passes under this 

restricted set of variables, the hospital 

will be considered to be submitting 

valid data for purposes of this proposed 

rule. 

Under the standard appeal process, all 

hospitals are given the detailed results 

of the Clinical Data Abstraction Center 

(CDAC) reabstraction along with their 

estimated percent reliability and the 

upper bound of the 95 percent 

confidence interval. If a hospital 

disagrees with any of the abstraction 

results from the CDAC, the hospital has 

10 days to appeal these results to their 

QIO. The QIO will review the appeal 

with the hospital and, if the QIO review 

agrees with the hospitals original 

abstraction, the QIO will forward the 

appeal to the CDAC for a final 

determination. If the QIO does not agree 

with the hospital’s appeal, then the 

original results stand. When the CDAC 

has made its final determination, the 

new results will be provided to the 

hospital through the usual processes 

and the validation described previously 

will be repeated. This process is 

described in detail at the following Web 

site: http://www.qnetexchange.org. 

Hospitals that fail to receive the 

required 80-percent reliability after the 

standard appeals process may ask that 

CMS accept the fourth quarter of 

calendar year 2004 validation results as 

a final attempt to present evidence of 

reliability. However, in order to process 

the fourth quarter data in time to meet 

our internal deadlines, these hospitals 

will need to submit the charts requested 

for reabstraction as soon as possible, but 

no later than August 1, 2005, in order 

for us to guarantee consideration of this 

information. Hospitals that make the 

early submission of these data and pass 

the 80-percent reliability minimum 

level will satisfy this requirement. In 

reviewing the data for these hospitals, 

we plan to combine the 5 cases from the 

third quarter and the 5 cases from the 

fourth quarter into a single sample to 

determine whether the 80 percent 

reliability level is met. This gives us the 

greatest accuracy when estimating the 

reliability level. The confidence interval 

approach accounts for the variation in 

coding among the 5 charts pulled each 

quarter and for the entire year around 

the overall hospital mean score (on all 

individual data elements compared). 

The closer each case’s reliability score is 

to the hospital mean score, the tighter 

the confidence interval established for 

that hospital. A hospital may code each 

chart equally inaccurately, achieve a 

tight confidence interval, and fail to 

pass even though its overall score is just 

below the passing threshold (75 percent, 

for example). A hospital with more 

variation among charts will achieve a 

broader confidence interval, which may 

allow it to pass even though some charts 

score very low and others very high. As 

we gain experience with this system, we 

will adjust it as appropriate over time as 

we build our sample of validated cases 

and learn more about hospital 

performance against the thresholds we 

establish. 

We believe we have adopted the most 

suitable statistical tests for the hospital 

data we are trying to validate, but we 

invite public comments on this and any 

other approaches hospitals choose to 

comment on. We are particularly 

interested in comments from hospitals 

on the initial starting points for the 

passing threshold, the confidence 

interval established, and the sampling 

approach. Because we will be receiving 

data each quarter from hospitals, our 

information on the sampling 

methodology will improve with each 

quarter’s submissions. We will analyze 

this information to determine if any 

changes in our methodology are 

required. We will make any necessary 

revisions to the sampling methodology 

and the statistical approach through 

manual issuances and other guidance to 

hospitals. 

• The hospital must have two 

consecutive quarters of publishable 

data. The information collected by CMS 

through this rule will be displayed for 

public viewing on the Internet. Prior to 

this display, hospitals are permitted to 

preview their information as we have it 

recorded. In our previous experience, a 

number of hospitals requested that this 

information not be displayed due to 

errors in the submitted data that were 

not of the sort that could be detected by 

the normal edit and consistency checks. 

We acquiesced to these requests in the 

public interest and because of our own 

desire to present correct data. However, 

we still believe that the hospital bears 

the responsibility of submitting correct 

data that can serve as valid and reliable 

information. Therefore, in order to 

receive the full market basket update for 

IPPS, we are proposing to establish a 

requirement for two consecutive 

quarters of publishable data. We 

published the first quarter of calendar 

year 2004 data in November 2004. The 

first two quarters of calendar year 2004 

data were published in March 2005. Our 

plans are to publish the first three 

quarters of calendar year 2004 in August 

2005. For the FY 2006 update, we will 

expect that all hospitals receiving the 

full market basket update for FY 2006 to 

have published data for all of the 

required 10 measures for both the March 

and August 2005 publications. 

Allowances would be made for 

hospitals that do not treat a particular 

condition and for new hospitals that 

have not had the opportunity to provide 

the required data. 

C. Sole Community Hospitals (SCHs) 

and Medicare Dependent Hospitals 

(MDHs) (§§ 412.73, 412.75, 412.77, 

412.92 and 412.108) 

(If you choose to comment on issues 

in this section, please include the 

caption ‘‘Sole Community Hospitals and 

Medicare Dependent Hospitals’’ at the 

beginning of your comments.) 

1. Background 

Under the IPPS, special payment 

protections are provided to a sole 

community hospital (SCH). Section 

1886(d)(5)(D)(iii) of the Act defines an 

SCH as a hospital that, by reason of 

factors such as isolated location, 

weather conditions, travel conditions, 

absence of other like hospitals (as 

determined by the Secretary), or 

historical designation by the Secretary 

as an essential access community 

hospital, is the sole source of inpatient 

hospital services reasonably available to 

Medicare beneficiaries. The regulations 

that set forth the criteria that a hospital 

must meet to be classified as an SCH are 

located in § 412.92 of the regulations. 

Although SCHs and MDHs are paid 

under a special payment methodology, 

they are hospitals that are paid under 

section 1886(d) of the Act. Like all IPPS 

hospitals paid under section 1886(d) of 

the Act, SCHs and MDHs are paid for 

their discharges based on the DRG 

weights calculated under section 

1886(d)(4) of the Act. 

Effective with hospital cost reporting 

periods beginning on or after October 1, 

2000, section 1886(d)(5)(D)(i) of the Act 

(as amended by section 6003(e) of Pub. 

L. 101–239) and section 1886(b)(3)(I) of 

the Act (as added by section 405 of Pub. 

L. 106–113 and further amended by 

section 213 of Pub. L. 106–554), provide 

that SCHs are paid based on whichever 

of the following rates yields the greatest 

aggregate payment to the hospital for the 

cost reporting period: 

• The Federal rate applicable to the 

hospital; 

• The updated hospital-specific rate 

based on FY 1982 costs per discharge; 

• The updated hospital-specific rate 

based on FY 1987 costs per discharge; 

or 

• The updated hospital-specific rate 

based on FY 1996 costs per discharge. 

For purposes of payment to SCHs for 

which the FY 1996 hospital-specific rate 

yields the greatest aggregate payment, 

payments for discharges during FYs 

2001, 2002, and 2003 were based on a 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23427 

blend of the FY 1996 hospital-specific 

rate and the greater of the Federal rate 

or the updated FY 1982 or FY 1987 

hospital-specific rate. For discharges 

during FY 2004 and subsequent fiscal 

years, payments based on the FY 1996 

hospital-specific rate are 100 percent of 

the updated FY 1996 hospital-specific 

rate. 

For each cost reporting period, the 

fiscal intermediary determines which of 

the payment options will yield the 

highest rate of payment. Payments are 

automatically made at the highest rate 

using the best data available at the time 

the fiscal intermediary makes the 

determination. However, it may not be 

possible for the fiscal intermediary to 

determine in advance precisely which 

of the rates will yield the highest 

payment by year’s end. In many 

instances, it is not possible to forecast 

the outlier payments, the amount of the 

DSH adjustment, or the IME adjustment, 

all of which are applicable only to 

payments based on the Federal rate. The 

fiscal intermediary makes a final 

adjustment at the close of the cost 

reporting period to determine precisely 

which of the payment rates would yield 

the highest payment to the hospital. 

If a hospital disagrees with the fiscal 

intermediary’s determination regarding 

the final amount of program payment to 

which it is entitled, it has the right to 

appeal the fiscal intermediary’s decision 

in accordance with the procedures set 

forth in subpart R of part 400, which 

concern provider payment 

determinations and appeals. 

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

Act, Medicare dependent hospitals 

(MDHs) 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 costs 

per discharge, whichever is higher. 

MDHs do not have the option to use 

their FY 1996 hospital-specific rate. The 

regulations that set forth the criteria that 

a hospital must meet to be classified as 

an MDH are located in § 412.108. 

2. Budget Neutrality Adjustment to 

Hospital Payments Based on HospitalSpecific Rate 

Under section 1886(d)(4)(C)(i) of the 

Act, beginning in FY 1988 and for each 

fiscal year thereafter, the Secretary is 

required to adjust the DRG 

classifications and weighting factors 

established under sections 1886(d)(4)(A) 

and (d)(4)(B) of the Act to reflect 

changes in treatment patterns, 

technology, and other factors that may 

change the use of hospital resources. For 

discharges beginning in FY 1991, 

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

requires the Secretary to ensure that 

adjustments to DRG classifications and 

weighting factors result in aggregate 

DRG payments that are budget neutral 

(not greater or less than the aggregate 

payments without the adjustments). In 

addition, section 1886(d)(3)(E) of the 

Act requires the Secretary to update the 

hospital wage index annually in a 

manner that does not affect aggregate 

payments to hospitals under section 

1886(d) of the Act. 

As discussed in the May 9, 1990 IPPS 

proposed rule (55 FR 19466), we 

normalize the proposed 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. While this 

adjustment is intended to ensure that 

recalibration does not affect total 

payments to hospitals under section 

1886(d) of the Act, our analysis has 

indicated that the normalization 

adjustment does not achieve budget 

neutrality with respect to aggregate 

payments to hospitals under section 

1886(d) of the Act. In order to comply 

with the requirement of section 

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

reclassification changes and 

recalibration of the relative weights be 

budget neutral and the requirement of 

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

updated wage index be implemented in 

a budget neutral manner, we compare 

the estimated aggregate payments using 

the current year’s relative weights and 

wage index factors to aggregate 

payments using the prior year’s weights 

and factors. Based on this comparison, 

we compute a budget neutrality 

adjustment factor. This budget 

neutrality adjustment factor is then 

applied to the standardized per 

discharge payment amount. Beginning 

in FY 1994, in applying the current 

year’s budget neutrality adjustment 

factor to both the standard Federal rate 

and hospital-specific rates, we do not 

remove the prior years’ budget 

neutrality adjustment factors because 

estimated aggregate payments after the 

changes in the DRG relative weights and 

wage index factors must equal estimated 

aggregate payments prior to the changes. 

If we removed the prior year 

adjustment, we would not satisfy this 

condition. (58 FR 30269) 

We are bound by the Act to ensure 

that aggregate payments to hospitals 

under section 1886(d) of the Act are 

projected to neither increase nor 

decrease as a result of the annual 

updates to the DRG classifications and 

weighting factors and for the updated 

wage indices. However, we have broad 

authority under the statute to determine 

the method for implementing budget 

neutrality. We have maintained since 

1991 that the budget neutrality 

adjustment is applied, as described 

above, to all hospitals paid under 

section 1886(d) of the Act, including 

those that are paid based on a hospitalspecific rate. Thus, the budget neutrality 

factor applies to payments to SCHs and 

MDHs. 

Hospitals that are paid under section 

1886(d) of the Act based on a hospitalspecific rate are subject to the DRG 

reclassification and recalibration factor 

component of the budget neutrality 

adjustment because, as IPPS hospitals, 

they are paid based on DRGs. As 

described above, changes in DRG 

relative weights from one year to the 

next affect aggregate SCH and MDH 

payments, which in turn affect total 

Medicare payments to hospitals under 

section 1886(d) of the Act. Because 

SCHs and MDHs are paid under section 

1886(d) of the Act, we believe their DRG 

payments should be factored into the 

DRG reclassification and recalibration 

factor component of the budget 

neutrality adjustment to ensure that 

recalibration does not affect total 

payments to hospitals under section 

1886(d) of the Act. Therefore, we 

continue to believe it is appropriate to 

apply the DRG reclassification and 

recalibration factor component of the 

budget neutrality adjustment to SCHs 

and MDHs. Furthermore, consistent 

with the requirement of section 

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

reclassification changes and 

recalibration of relative weights be 

budget neutral, we continue to believe 

it is appropriate to apply this 

adjustment without removing the 

previous year’s adjustment factor. 

In the May 9, 1990 proposed rule (55 

FR 19466), we discussed the rationale 

behind our decision to apply the wage 

index portion of the budget neutrality 

adjustment factors to hospitals that are 

paid under section 1886(d) of the Act 

based on a hospital-specific rate. We 

described how, even though the wage 

index is only applicable to those 

hospitals that are paid based on the 

Federal rate, the changes in wage index 

can cause changes in the payment basis 

for some SCHs, and MDHs. That is, 

depending on the size of the increase in 

their wage index values, some hospitals 

that had been paid based on the 

hospital-specific rate could now be paid 

based on the Federal rate when the wage 

index-adjusted Federal rate exceeds the 

hospital-specific rate. In some instances, 

hospitals that had previously been paid 

based on the Federal rate may be paid 

based on the hospital-specific rate if the 

Federal rate is adjusted by a lower wage 

23428 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

index and the hospital-specific rate now 

exceeds the Federal rate. These shifts in 

the payment basis affect aggregate 

program payments and, therefore, are 

taken into account in the budget 

neutrality adjustment. In addition, we 

maintained that because we apply the 

adjustment to all hospitals paid based 

on the Federal rate under section 

1886(d) of the Act, it would be fair to 

apply it to hospitals that are paid under 

section 1886(d) of the Act based on 

hospital-specific rates. We believed that 

if we did not apply the budget neutrality 

factor to hospitals paid based on their 

hospital-specific rate, hospitals that are 

paid on the Federal rate would be 

subject to larger reductions to make up 

for not adjusting payments to hospitals 

that are paid based on hospital-specific 

rates. 

Concerns have been raised that 

hospitals under section 1886(d) of the 

Act whose reimbursement is based on a 

hospital-specific rate should not be 

subject to the wage index component of 

the budget neutrality adjustment. 

Hospital-specific rates reflect the effects 

of hospitals’ area wage levels and, 

therefore, are not adjusted by an area 

wage index. Accordingly, the concern is 

that a budget neutrality factor for 

changes in the wage index should not be 

applied to hospitals that are paid based 

on a hospital-specific rate. In addition, 

it has been suggested that the budget 

neutrality adjustment that CMS applies 

to hospitals paid on a hospital-specific 

rate should be similar to the budget 

neutrality adjustment made to hospitals 

in Puerto Rico. Hospitals in Puerto Rico 

that are paid under the IPPS are paid 

based on a blend of the national 

prospective payment rate and the Puerto 

Rico-specific prospective payment rate 

(42 CFR 412.212). Beginning in FY 

1991, the Puerto Rico-specific 

standardized amount became subject to 

a budget neutrality adjustment. This 

budget neutrality adjustment included 

both the DRG reclassification and 

recalibration factor component and the 

wage index component. However, 

beginning in FY 1998, the Puerto Ricospecific rate has been subject only to the 

DRG reclassification and recalibration 

factor component of the budget 

neutrality adjustment (62 FR 46038) and 

not to the wage index component of the 

budget neutrality adjustment. In other 

words, beginning in FY 1998, the budget 

neutrality adjustment for the Puerto 

Rico-specific rate reflects only the DRG 

reclassification and recalibration factor 

component. This adjustment is 

computed, as described above, for all 

hospitals paid under section 1886(d) of 

the Act, without removing the previous 

year’s budget neutrality adjustment. 

We have considered the concern that 

it is inappropriate to apply a budget 

neutrality factor that includes a 

component for changes in the wage 

index to a hospital with a payment rate 

that is not adjusted by a wage index 

adjustment. In cases in which a 

hospital’s payments are ultimately 

based on a hospital-specific rate, that 

portion of the payment is not adjusted 

by a wage index. We believe that our 

current policy is valid, for the reasons 

indicated above and in previous 

rulemaking documents, but we 

recognize that there are also valid 

grounds to review the regulations and 

consider other approaches. Accordingly, 

we are revisiting this policy. After 

further consideration of these issues, we 

are proposing to remove the wage index 

component from the budget neutrality 

adjustment applied to the hospitalspecific rate for hospitals paid under 

section 1886(d) of the Act. The DRG 

reclassification and recalibration factor 

component of the budget neutrality 

adjustment would still apply to these 

hospitals, as payments to SCHs and 

MDHs are based on DRGs and affect 

total Medicare payments to hospitals 

under section 1886(d) of the Act. In 

applying this budget neutrality 

adjustment factor, which would include 

only the DRG reclassification and 

recalibration factor component, to the 

hospital-specific rate, we would not 

remove the prior years’ budget 

neutrality adjustment factors. This 

would satisfy the statutory requirement 

that estimated aggregate payments after 

the changes in the DRG relative weights 

equal estimated aggregate payments 

prior to the changes. We are proposing 

that the wage index portion of the 

budget neutrality adjustment would not 

be applied to hospital-specific amounts, 

as these amounts are not adjusted by an 

area wage index. While this may result 

in a slightly higher budget neutrality 

adjustment applied to all other IPPS 

hospitals, because these hospitals 

actually are paid based on the revised 

wage indices and are affected by wage 

index changes, we believe this is 

appropriate. In addition, we note that in 

FY 1990 when this policy was first 

discussed, we did not calculate a budget 

neutrality factor that reflected only the 

DRG changes. Because we now calculate 

such a budget neutrality factor for 

Puerto Rico hospitals, it would not be 

administratively burdensome to apply 

the same budget neutrality factor to 

SCHs and MDHs. 

We are proposing to add a new 

paragraph (f) to § 412.73, a new 

paragraph (i) to § 412.75, and a new 

paragraph (j) to § 412.77 relating to the 

computation of the hospital-specific rate 

to clarify our longstanding policy that 

CMS makes an adjustment to the 

hospital-specific rate to ensure that 

changes to the DRG reclassifications and 

recalibrations of the DRG relative 

weights are made in a manner so that 

aggregate payments to hospitals under 

section 1886(d) of the Act are not 

affected, and that this adjustment is 

made without removing the budget 

neutrality adjustment for the prior year. 

These provisions are cross-referenced in 

§ 412.92 for SCHs and § 412.108 for 

MDHs for purposes of computing the 

hospital-specific rates for these 

hospitals. This proposed regulatory text 

will reflect the proposed changes to the 

way CMS applies the budget neutrality 

adjustment to hospitals paid under 

section 1886(d) of the Act based on the 

hospital-specific rate. Specifically, it 

would indicate that the budget 

neutrality adjustment made to hospitals 

paid under section 1886(d) of the Act 

based on the hospital-specific rate will 

only account for the DRG 

reclassification and recallibration factor 

component. The budget neutrality 

adjustment would no longer include the 

wage index factor component. 

3. Technical Change 

In the September 4, 1990 IPPS final 

rule (55 FR 36056), we made changes to 

the regulations at § 412.92 to 

incorporate the provisions of section 

6003(e) of Pub. L. 101–239. Section 

6003(e) of Pub. L. 101–239 provided for 

a permanent payment methodology for 

SCHs that recognized distortions in 

operating costs in years subsequent to 

the implementation of the IPPS and 

provided for opportunity for payment 

based on a new base year. As a result 

of this legislation, we deleted from the 

regulations a special provision that we 

had included under § 412.92(g) that 

provided for a payment adjustment to 

compensate SCHs reasonably for the 

increased operating costs resulting from 

the addition of new services or facilities. 

We have discovered that, in making 

the changes to § 412.92 in the 

September 4, 1990 final rule to remove 

paragraph (g), we inadvertently failed to 

make a conforming change to paragraph 

(d)(3) that references the provisions of 

paragraph (g) relating to a payment 

adjustment for significant increases in a 

SCH’s operating costs. In this proposed 

rule, we are proposing to make this 

technical correction by revising 

paragraph (d)(3). 

D. Rural Referral Centers (§ 412.96) 

(If you choose to comment on issues 

in this section, please include the 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23429 

caption ‘‘Rural Referral Centers’’ at the 

beginning of your document.) 

Under the authority of section 

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

regulations at § 412.96 set forth the 

criteria that a hospital must meet in 

order to qualify under the IPPS as a 

rural referral center. For discharges 

occurring before October 1, 1994, rural 

referral centers received the benefit of 

payment based on the other urban 

standardized amount rather than the 

rural standardized amount. Although 

the other urban and rural standardized 

amounts are the same for discharges 

occurring on or after October 1, 1994, 

rural referral centers continue to receive 

special treatment under both the DSH 

payment adjustment and the criteria for 

geographic reclassification. 

Section 402 of Pub. L. 108–173 raised 

the DSH adjustment for other rural 

hospitals with less than 500 beds and 

rural referral centers. Other rural 

hospitals with less than 500 beds are 

subject to a 12-percent cap on DSH 

payments. Rural referral centers are not 

subject to the 12.0 percent cap on DSH 

payments that is applicable to other 

rural hospitals (with the exception of 

rural hospitals with 500 or more beds). 

Rural referral centers are not subject to 

the proximity criteria when applying for 

geographic reclassification, and they do 

not have to meet the requirement that a 

hospital’s average hourly wage must 

exceed 106 percent of the average 

hourly wage of the labor market area 

where the hospital is located. 

Section 4202(b) of Pub. L. 105–33 

states, in part, ‘‘[a]ny 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 

year.’’ In the August 29, 1997 final rule 

with comment period (62 FR 45999), we 

also reinstated rural referral center 

status for all hospitals that lost the 

status due to triennial review or MGCRB 

reclassification, but not to hospitals that 

lost rural referral center status because 

they were now urban for all purposes 

because of the OMB designation of their 

geographic area as urban. However, 

subsequently, in the August 1, 2000 

final rule (65 FR 47089), we indicated 

that we were revisiting that decision. 

Specifically, we stated that we would 

permit hospitals that previously 

qualified as a rural referral center and 

lost their status due to OMB 

redesignation of the county in which 

they are located from rural to urban to 

be reinstated as a rural referral center. 

Otherwise, a hospital seeking rural 

referral center status must satisfy the 

applicable criteria. For FYs 1984 

through 2004, we used the definitions of 

‘‘urban’’ and ‘‘rural’’ in § 412.63. For FY 

2005 and subsequent years, the revised 

definitions of ‘‘urban’’ and ‘‘rural’’ in 

§ 412.64 apply. 

One of the criteria under which a 

hospital may qualify as a rural referral 

center is to have 275 or more beds 

available for use (§ 412.96(b)(1)(ii)). A 

rural hospital that does not meet the bed 

size requirement can qualify as a rural 

referral center if the hospital meets two 

mandatory prerequisites (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 referral volume) 

(§ 412.96(c)(1) through (c)(5)). (See also 

the September 30, 1988 Federal Register 

(53 FR 38513)). With respect to the two 

mandatory prerequisites, a hospital may 

be classified as a rural referral center 

if—

• The hospital’s 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 case-mix index for all urban 

hospitals nationally; and 

• The hospital’s number of discharges 

is at least 5,000 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, as specified in section 

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

1. Case-Mix Index 

Section 412.96(c)(1) provides that 

CMS 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. 

The methodology we use to determine 

the proposed national and regional casemix index values is set forth in 

regulations at § 412.96(c)(1)(ii). The 

proposed national median case-mix 

index value for FY 2006 includes all 

urban hospitals nationwide, and the 

proposed regional values for FY 2006 

are the median values of urban hospitals 

within each census region, excluding 

those hospitals with approved teaching 

programs (that is, those hospitals 

receiving indirect medical education 

payments as provided in § 412.105). 

These proposed values are based on 

discharges occurring during FY 2004 

(October 1, 2003 through September 30, 

2004) and include bills posted to CMS’

records through December 2004. 

We are proposing that, in addition to 

meeting other criteria, if they are to 

qualify for initial rural referral center 

status for cost reporting periods 

beginning on or after October 1, 2005, 

rural hospitals with fewer than 275 beds 

must have a case-mix index value for FY 

2004 that is at least—

• 1.3659; or 

• The median case-mix index value 

(not transfer-adjusted) for urban 

hospitals (excluding hospitals with 

approved teaching programs as 

identified in § 412.105) calculated by 

CMS for the census region in which the 

hospital is located. 

The proposed median case-mix index 

values by region are set forth in the 

following table: 

23430 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

The preceding numbers will be 

revised in the final rule to the extent 

required to reflect the updated FY 2004 

MedPAR file, which will contain data 

from additional bills through March 31, 

2005. 

Hospitals seeking to qualify as rural 

referral centers or those wishing to 

know how their case-mix index value 

compares to the criteria should obtain 

hospital-specific case-mix index values 

(not transfer-adjusted) from their fiscal 

intermediaries. Data are available on the 

Provider Statistical and Reimbursement 

(PS&R) System. 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. 

2. Discharges 

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

CMS will set forth the national and 

regional numbers of discharges in each 

year’s annual notice of prospective 

payment rates for purposes of 

determining rural referral center status. 

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

of the Act, the national standard is set 

at 5,000 discharges. We are proposing to 

update the regional standards based on 

discharges for urban hospitals’ cost 

reporting periods that began during FY 

2002 (that is, October 1, 2001 through 

September 30, 2002), which is the latest 

available cost report data we have at this 

time. 

Therefore, we are proposing that, in 

addition to meeting other criteria, a 

hospital, if it is to qualify for initial 

rural referral center status for cost 

reporting periods beginning on or after 

October 1, 2005, must have as the 

number of discharges for its cost 

reporting period that began during FY 

2002 a figure that is at least—

• 5,000 (3,000 for an osteopathic 

hospital); or 

• The median number of discharges 

for urban hospitals in the census region 

in which the hospital is located, as 

indicated in the following table: 


EP04MY05.058</GPH> EP04MY05.059</GPH>
Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23431 

These numbers will be revised in the 

final rule based on the latest available 

cost report data. 

We reiterate that if an osteopathic 

hospital is to qualify for rural referral 

center status for cost reporting periods 

beginning on or after October 1, 2005, 

the hospital would be required to have 

at least 3,000 discharges for its cost 

reporting period that began during FY 

2002. 

3. Technical Change 

In the FY 1998 IPPS final rule (62 FR 

46028), we removed paragraph (f) from 

§ 412.96. Paragraph (f) was removed 

when the requirement for triennial 

reviews of rural referral centers was 

terminated (62 FR 45998 through 45600, 

46028 through 46029). However, we 

inadvertently failed to address all of the 

related cross-references to paragraph (f) 

in the entire § 412.96. Therefore, we are 

proposing to revise § 412.96 to remove 

paragraphs (h)(4) and (i)(4), consistent 

with the removal of paragraph (f). 

E. Payment Adjustment for Low-Volume 

Hospitals (§ 412.101) 

(If you choose to comment on issues 

in this section, please include the 

caption ‘‘Low-Volume Hospital Payment 

Adjustment’’ at the beginning of your 

comment.) 

Section 1886(d)(12) of the Act, as 

added by section 406 of Pub. L. 108–

173, provides for a payment adjustment 

to account for the higher costs per 

discharge of low-volume hospitals 

under the IPPS. Section 

1886(d)(12)(C)(i) of the Act defines a 

low-volume hospital as a ‘‘subsection (d) 

hospital * * * that the Secretary 

determines is located more than 25 road 

miles from another subsection (d) 

hospital and that has less than 800 

discharges during the fiscal year.’’

Section 1886(d)(12)(C)(ii) of the Act 

further stipulates that the term 

‘‘discharge’’ refers to total discharges, 

and not merely to Medicare discharges. 

Specifically, the term refers to the 

‘‘inpatient acute care discharge of an 

individual regardless of whether the 

individual is entitled to benefits under 

part A.’’ Finally, the provision requires 

the Secretary to determine an applicable 

percentage increase for these lowvolume hospitals based on the 

‘‘empirical relationship’’ between ‘‘the 

standardized cost-per-case for such 

hospitals and the total number of 

discharges of these hospitals and the 

amount of the additional incremental 

costs (if any) that are associated with 

such number of discharges.’’ The statute 

thus mandates the Secretary to develop 

an empirically justifiable adjustment 

based on the relationship between costs 

and discharges for these low-volume 

hospitals. The statute also limits the 

adjustment to no more than 25 percent. 

According to the analysis conducted 

for the FY 2005 IPPS final rule (69 FR 

49099 through 49102), a 25 percent lowvolume adjustment to all qualifying 

hospitals with less than 200 discharges 

was found to be most consistent with 

the statutory requirement to provide 

relief to low-volume hospitals where 

there is empirical evidence that higher 

incremental costs are associated with 

low numbers of total discharges. 

However, we acknowledged that the 

empirical evidence did not provide 

robust support for that conclusion and 

indicated that we would reexamine the 

empirical evidence for the FY 2006 IPPS 

final rule with the intention of 

modifying or even eliminating the 

adjustment if the empirical evidence 

indicates that it is appropriate to do so. 

In the FY 2005 IPPS final rule (69 FR 

49102), we indicated that our analysis 

showed that there are fewer than 100 

hospitals with less than 200 total 

discharges. At that time, we were unable 

to determine how many of these 

hospitals also meet the requirement that 

a low-volume hospital be more than 25 

road miles from the nearest IPPS 

hospital in order to qualify for the 

adjustment. Our data systems currently 

indicate that 10 hospitals are receiving 

the low-volume adjustment. 

As indicated in the FY 2005 IPPS 

final rule, we have now conducted a 

more detailed multivariate analysis on 

the empirical basis for a low-volume 

adjustment for FY 2006. In order to 

further evaluate the need for a proposed 

change in the development of the lowvolume adjustment, we replicated much 

of the analysis conducted for the FY 

2005 IPPS final rule, using updated 

data. We again empirically modeled the 

relationship between hospital costs-percase and total discharges in several 

ways. We used both regression analysis 

and straight-line statistics to examine 

this relationship. 

We conducted three different 

regression analyses. For all of the 

analyses, we simulated the FY 2005 cost 

environment by inflating FY 2002 and 

FY 2003 hospital cost report data to FY 

2005 using the full hospital market 

basket updates. We note that, at the time 

of this analysis, we only had cost report 

data from FY 2003 for approximately 57 

percent of the IPPS hospitals. Therefore, 

we have placed a greater weight on the 

results from the simulated FY 2002 cost 

data, which are significantly more 

complete. We again simulated the FY 

2005 payment environment because 

payments have undergone several 

changes between FY 2002 and FY 2003 

and FY 2005, making the results of the 

earlier data less relevant. Furthermore, 

many of these policy changes may 

already have helped increase payments 

to low-volume hospitals. We were 

unable to simulate the FY 2006 

environment because payment factors 

for FY 2006 were not available at the 

time of our analysis. 

In the first regression analysis, we 

used a dummy variable approach to 

model the relationship between 

standardized costs and total discharges. 

Using FY 2002 cost data, we found some 

evidence for a low-volume payment 

adjustment for hospitals with up to 199 

discharges, consistent with our current 

policy. Using FY 2003 cost data, the 

empirical evidence only supported an 

adjustment for hospitals with up to 99 

total discharges. 

We also used a descriptive analysis 

approach to understand empirically the 

relationship between costs and total 

discharges. We grouped all hospitals by 

their total discharges and compared the 

mean Medicare per discharge payment 

to Medicare per discharge cost ratios. 

Hospitals with less than 800 total 

discharges were split into 24 cohorts 

based on increments of 25 discharges. 

When using the FY 2002 cost report 

data, the mean payment-to-cost ratios 

were below one (implying that Medicare 

per discharge costs exceeded Medicare 

per discharge payments) for all cohorts 

of hospitals with less than 200 

discharges, after which the ratio was 

consistently above one. When using the 

FY 2003 cost report data, the mean 

payment-to-cost ratios were below one 

for all but two cohorts up to those with 

less than 175 total discharges, after 

which the ratio was consistently above 

one. No obvious increasing trend in the 

ratios, from which it would be possible 

to infer a formula to generate 

adjustments for hospitals based upon 

the number of discharges, was evident. 

Because more than 70 percent of 

hospitals with less than 200 discharges 

had ratios below 0.80, this analysis 

supports applying the highest payment 

adjustment to all providers with less 

than 200 discharges that are eligible for 

the low-volume adjustment. 

The second regression analysis 

modeled the Medicare per discharge 

cost to Medicare per discharge payment 

ratio as a function of total discharges. 

The cost-to-payment ratio model more 

explicitly accounts for the relative 

values of per discharge costs and per 

discharge payments. These models 

provided some evidence for a 

statistically significant negative 

relationship between the cost-topayment ratio and total discharges. 

However, that result was limited to FY 

23432 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

2002 data. FY 2003 data displayed no 

significant relationship between the 

cost-to-payment ratio and total 

discharges. 

The third regression analysis 

employed per discharge costs minus per 

discharge payments as the dependent 

variable and total discharges as an 

explanatory variable. The results of this 

analysis were similar to the other 

regression analyses: some evidence was 

provided for an adjustment with the FY 

2002 data, but not with the FY 2003 

data, simulated for FY 2005. In fact, the 

FY 2003 data results suggest (with a 

positive intercept and positive 

coefficient on total discharges) that 

payments are greater than costs for all 

hospitals, including the low-volume 

hospitals. 

Based upon these multivariate 

analyses using the FY 2002 cost report 

data, a case can be made that hospitals 

with fewer than 200 total discharges 

have per discharge costs that are 

statistically significantly higher relative 

to their Medicare per discharge 

payments in comparison to hospitals 

with 200 or more total discharges. 

Therefore, we are proposing to extend 

the existing low-volume adjustment for 

FY 2006. That is, a low-volume 

adjustment would again be provided for 

qualifying hospitals with less than 200 

discharges. As noted above, the 

descriptive data do not reveal any 

pattern that could provide a formula for 

calculating an adjustment in relation to 

the number of discharges. However, the 

descriptive analysis of the data does 

indicate that, for a large majority of the 

hospitals with less than 200 discharges, 

the maximum adjustment of 25 percent 

would be appropriate because, for 

example, the payment-to-cost ratios for 

more than 70 percent of these hospitals 

are 0.80 or less. The maximum 

adjustment of 25 percent would still 

leave most of these hospitals with 

payment-to-cost ratios below 1.00. 

Because a large majority of hospitals 

with less than 200 discharges have 

payment-to-cost ratios below 1.00, we 

are proposing to again provide hospitals 

with less than 200 total discharges in 

the most recent submitted cost report an 

adjustment of 25 percent on each 

Medicare discharge. This policy is 

consistent with the existing language in 

§ 412.101(a) and (b). 

However, the initial analysis of the FY 

2003 data does not seem to provide 

strong empirical evidence for a 

relationship between Medicare per 

discharge costs and total discharges. 

Therefore, we will reevaluate the 

appropriateness of the low-volume 

adjustment in the FY 2007 proposed 

rule. 

F. Indirect Medical Education (IME) 

Adjustment (§ 412.105) 

(If you choose to comment on issues 

in this section, please include the 

caption ‘‘IME Adjustment’’ at the 

beginning of your comment.) 

1. Background 

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

provides that prospective payment 

hospitals that have residents in an 

approved graduate medical education 

(GME) program receive an additional 

payment to reflect the higher indirect 

costs of teaching hospitals relative to 

nonteaching hospitals. The regulations 

regarding the calculation of this 

additional payment, known as the 

indirect medical education (IME) 

adjustment, are located at § 412.105. 

The IME adjustment to the DRG 

payment is based in part on the 

applicable IME adjustment factor. The 

IME adjustment factor is calculated 

using a hospital’s ratio of residents to 

beds, which is represented as r, and a 

formula multiplier, which is 

represented as c, in the following 

equation: c × [{1 + r} .405 ¥ 1]. The 

formula is traditionally described in 

terms of a certain percentage increase in 

payment for every 10-percent increase 

in the resident-to-bed ratio. 

2. IME Adjustment for TEFRA Hospitals 

Converting to IPPS Hospitals 

The Balanced Budget Act of 1997 

(Pub. L. 105–33) established a limit on 

the number of allopathic and 

osteopathic residents that a hospital 

may include in its full-time equivalent 

(FTE) count for direct GME and IME 

payment purposes. Under section 

1886(h)(4)(F) of the Act, a hospital’s 

unweighted FTE count of residents may 

not exceed the hospital’s unweighted 

FTE count for its most recent cost 

reporting period ending on or before 

December 31, 1996. Under section 

1886(d)(5)(B)(v) of the Act, the limit on 

the FTE resident count for IME purposes 

is effective for discharges occurring on 

or after October 1, 1997. A similar limit 

is effective for direct GME purposes for 

cost reporting periods beginning on or 

after October 1, 1997. 

When these provisions were enacted, 

hospitals reported their weighted FTE 

resident count for direct GME and their 

unweighted FTE resident count for IME 

on the Medicare cost report. The cost 

report was subsequently modified to 

require reporting of unweighted FTE 

resident counts for both direct GME and 

IME. However, for cost reporting 

periods ending on or before December 

31, 1996 (the cost report on which the 

FTE limit is based), hospitals were not 

required to report unweighted FTE 

resident counts for direct GME 

purposes. Therefore, a separate data 

collection effort was required to obtain 

the unweighted FTE resident counts. 

The fiscal intermediaries worked with 

hospitals to determine the unweighted 

FTE resident counts for direct GME for 

cost reporting periods ending on or 

before December 31, 1996, for purposes 

of implementing the FTE cap. 

During this process, the fiscal 

intermediaries did not determine IME 

FTE resident counts for hospitals that 

were excluded from the IPPS (that is, 

psychiatric hospitals, LTCHs, 

rehabilitation hospitals, children’s 

hospitals, and cancer hospitals) because 

these hospitals were not paid under the 

IPPS and, therefore, did not receive any 

IME payment adjustments. Only the 

FTE resident data related to direct GME 

payments were relevant for these 

excluded hospitals and, therefore, only 

those data were collected. However, it 

has come to our attention that some 

hospitals that were excluded from the 

IPPS during the cost reporting period 

ending on or before December 31, 1996 

(that is, the cost reporting period during 

which the hospital’s FTE resident limit 

was established under section 

1886(h)(4)(F) of the Act for purposes of 

direct GME payments) have either failed 

to continue to qualify for exclusion from 

the IPPS or deliberately changed their 

operations in a way to become subject 

to the IPPS and, as a result, have 

subsequently become subject to the IME 

payment adjustment provisions of the 

IPPS. For example, a provider that was 

a rehabilitation hospital during its cost 

reporting period ending on December 

31, 1996, but no longer meets the 

regulatory criteria to qualify as a 

rehabilitation hospital would become 

subject to the IPPS and be able to 

receive IME payments. However, 

because no IME FTE resident count for 

the cost reporting period ending on or 

before December 31, 1996, was 

determined, such a hospital does not 

have an unweighted FTE resident limit 

for IME. 

To address this situation, we are 

proposing to incorporate in the 

regulations (proposed 

§ 412.105(f)(1)(xiii)) CMS’ existing 

policy in such situations which 

provides for the establishment of an IME 

FTE cap for a hospital that was 

excluded from the IPPS during its base 

year and that subsequently became 

subject to the IPPS. We are clarifying 

and proposing to adopt into regulations 

our existing policy that, in such a 

situation, the fiscal intermediary would 

determine an IME FTE cap for the 

hospital, applicable beginning with the 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23433 

hospital’s payments under the IPPS, 

based on the FTE count of residents 

during the cost reporting period(s) used 

to determine the hospital’s direct GME 

FTE cap in accordance with existing 

§ 412.105(f) of the regulations. The new 

IPPS hospital’s IME FTE cap would be 

subject to the same rules and 

adjustments as any IPPS hospital’s IME 

FTE cap in accordance with § 412.105(f) 

of the regulations. 

While calculation of the IME FTE cap 

for a TEFRA hospital that converts to an 

IPPS hospital may require that fiscal 

intermediaries obtain information from 

cost reporting periods that are closed, 

allowing a fiscal intermediary to obtain 

this information should not be 

understood as allowing a fiscal 

intermediary to reopen closed cost 

reports that are beyond the normal 

reopening period in order to carry out 

the provisions of this proposed 

regulation. 

Finally, there may be situations where 

the data necessary to carry out this 

policy are not available. For example, 

under this proposal, if a children’s 

hospital converts to an IPPS hospital on 

July 1, 2007, the fiscal intermediary may 

need to determine the count of FTE 

residents for IME purposes training at 

the hospital during the most recent cost 

reporting period ending on or before 

December 31, 1996, in order to establish 

an IME FTE cap for the hospital, 

effective for discharges occurring on or 

after October 1, 2007. However, the 

count of FTE residents for IME purposes 

from the cost reporting period ending on 

or before December 31, 1996, may no 

longer be available, as the minimum 

time that hospitals are required to retain 

records is 5 years from the date the 

hospital submits the cost report. We 

believe this problem may not occur with 

sufficient frequency to warrant specific 

regulatory action. We are specifically 

soliciting comments as to whether and 

how hospitals believe this is a problem 

that needs to be addressed. 

In some cases, a hospital that was 

previously excluded from the IPPS may 

become subject to the IPPS as a result 

of a merger between two or more 

hospitals where the surviving hospital is 

subject to the IPPS (and not creating an 

IPPS hospital with an excluded unit). In 

such cases, CMS policy is that the FTE 

resident cap for the surviving hospital 

should reflect the combined FTE 

resident caps for the hospitals that 

merged. If two or more hospitals merge 

after the conclusion of each hospital’s 

base year for purposes of calculating 

resident FTE caps, the surviving 

hospital’s FTE resident cap is an 

aggregation of the FTE resident cap for 

each hospital participating in the 

merger. When a merger involves an 

IPPS-excluded hospital, the base year 

IME FTE count for the IPPS-excluded 

hospital has not been determined. We 

are clarifying and proposing to codify in 

regulations our existing policy that, in 

such cases, the fiscal intermediary 

would determine an IME FTE cap for 

the IPPS-excluded hospital for purposes 

of determining the merged hospital’s 

IME FTE cap in accordance with 

§ 412.105(f) of the regulations. Once this 

cap is determined, the aggregate IME 

FTE cap of the surviving entity may be 

calculated in accordance with existing 

CMS policy for mergers. 

We note that we would compute an 

IME cap for an IPPS-excluded hospital 

only in cases of a merger between an 

IPPS-excluded hospital and an acute 

care IPPS hospital, where the entire 

surviving entity is subject to the IPPS. 

No such IME FTE cap would be 

computed for an IPPS-excluded hospital 

in instances where an IPPS-excluded 

hospital and an acute care IPPS hospital 

agree to form a Medicare GME affiliated 

group for purposes of aggregating FTE 

resident caps. In cases where an IPPSexcluded hospital enters into a 

Medicare GME affiliation agreement 

with other IPPS hospitals, the IPPSexcluded hospital can contribute only 

its direct GME FTE cap to the aggregate 

FTE cap for the group. This is because, 

as long as a hospital remains excluded 

from the IPPS, that hospital will not 

have an FTE resident cap established for 

purposes of IME. Under no 

circumstances may an IPPS-excluded 

hospital be considered to contribute any 

FTE residents to a Medicare GME 

affiliation group for purposes of the 

aggregate IME FTE resident cap. IPPSexcluded hospitals do not currently, and 

would not under this proposed policy, 

have an IME FTE resident cap. 

3. Section 1886(d)(8)(E) Teaching 

Hospitals That Withdraw Rural 

Reclassification 

In section V.I. of this preamble, we 

discuss situations in which an urban 

hospital may become rural under a 

reclassification request under section 

1886(d)(8)(E) of the Act. Under section 

1886(d)(8)(E) of the Act, an urban 

hospital may file an application to be 

treated as being located in a rural area. 

Becoming rural under this provision 

affects only payments under section 

1886(d) of the Act. If the hospital is a 

teaching hospital, the hospital could not 

receive adjustments to its direct GME 

FTE cap because payments for direct 

GME are made under section 1886(h) of 

the Act and the section 1886(d)(8)(E) 

reclassifications affect only the 

payments that are made under section 

1886(d) of the Act. Therefore, an urban 

hospital that reclassifies as rural under 

this provision may receive the 130- 

percent adjustment to its IME FTE 

resident cap. In addition, its IME FTE 

cap may be adjusted for any new 

programs (similar to a hospital that is 

actually located in an area designated as 

rural) under section 1886(d)(5)(B)(v) of 

the Act, as amended by section 407 of 

Pub. L. 106–113 (BBRA). 

An urban hospital treated as rural 

under section 1886(d)(8)(E) of the Act 

may subsequently withdraw its election 

and return to its urban status under the 

regulations at § 412.103. We are 

proposing that, effective with discharges 

occurring on or after October 1, 2005, 

hospitals that rescind their section 

1886(d)(8)(E) reclassifications and 

return to being urban would not be 

eligible for permanent increases in their 

IME caps. Rather, any adjustments the 

hospitals received to their IME caps due 

to their rural status would be forfeited 

upon returning to urban status. 

Although we read the relevant IME FTE 

cap provisions in section 1886(d)(5)(B) 

of the Act as effecting a permanent 

increase to the FTE cap, we believe we 

have the statutory authority under 

section 1886(d)(5)(I) of the Act to make 

necessary adjustments to these caps that 

we believe are appropriate. Section 

1886(d)(5)(I)(i) of the Act grants the 

Secretary authority to provide by 

regulation for ‘‘such other exceptions 

and adjustments to such payment 

amounts under this subsection as the 

Secretary deems appropriate.’’ We 

believe it is appropriate that a section 

1886(d)(8)(E) hospital forfeit the 

adjustments it received solely due to its 

reclassification to rural status when it 

returns to being urban. Otherwise, urban 

hospitals might reclassify to rural areas 

under section 1886(d)(8)(E) of the Act 

for a short period of time solely as a 

means of receiving an increase to their 

IME FTE caps. These hospitals could 

reclassify for as little as one year, simply 

in order to receive a permanent increase 

to their IME FTE caps. Because section 

1886(d)(8)(E) hospitals have control 

over when they switch in and out of 

rural status, we believe any other policy 

would be subject to gaming and 

inappropriate usage of the section 

1886(d)(8)(E) authority. In contrast, 

hospitals that become urban due to the 

OMB-revised labor area designations 

have no control in the matter, and 

therefore would not be subject to the 

same type of manipulation of payment 

rates we believe would exist with the 

section 1886(d)(8)(E) hospitals. 

(We note that the above proposed 

policy would have no effect on rural 

track resident training programs. 

23434 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

Section 1886(h)(4)(H)(iv) of the Act, 

which governs direct GME, provides 

that an urban hospital may receive 

adjustments to its FTE caps for 

establishing ‘‘separately accredited 

approved medical residency training 

programs (or rural tracks) in an [sic] 

rural area.’’ The provisions governing 

IME state that ‘‘Rules similar to the rules 

of subsection (h)(4)(H) shall apply for 

purposes of’’ determining FTE resident 

caps (section 1886(d)(5)(B)(viii) of the 

Act). Since the requirement that the 

hospital be located in a rural area is 

found in the provisions governing direct 

GME (section 1886(h) of the Act), not 

the provision governing IME, and since 

hospitals cannot reclassify as rural for 

purposes of section 1886(h) of the Act, 

we believe that, as provided in section 

1886(h) of the Act, the hospital with 

which the urban hospital establishes the 

rural track must be physically located in 

an area designated as rural. We do not 

believe we would be properly 

incorporating the rules of section 

1886(h) of the Act or creating a rule 

similar to that used in section 1886(h) 

of the Act if we were to allow counting 

of such reclassified hospitals.) 

For the reasons stated above, we are 

proposing to amend the regulations at 

§ 412.105 by adding a new paragraph 

(f)(1)(xiv) to provide that a hospital that 

rescinds its section 1886(d)(8)(E) 

reclassification will forfeit any 

adjustments to its IME FTE cap it 

received due to its rural status. Thus, for 

example, a hospital that reclassified as 

rural under section 1886(d)(8)(e) of the 

Act with an IME FTE cap of 10 would 

have received a 130 percent adjustment 

to its IME cap (that is, 10 FTEs × 1.3). 

Furthermore, if this hospital, while 

reclassified as rural, started a new 3- 

year residency program with 2 residents 

in each program year, its FTE cap would 

have been increased by an additional 6 

FTEs to 19 FTEs (that is, 13 FTEs + 6 

FTEs). However, once this hospital 

rescinds its reclassification under 

section 1886(d)(8)(E) of the Act to 

become urban again, its IME FTE cap 

would return to 10 FTEs (its original 

pre-reclassification IME FTE cap). 

G. Payment to Disproportionate Share 

Hospitals (DSHs) (§ 412.106) 

(If you choose to comment on issues 

in this section, please include the 

caption ‘‘DSH Adjustment Data’’ at the 

beginning of your comment.) 

1. Background 

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

provides for additional payments to 

subsection (d) hospitals that serve a 

disproportionate share of low-income 

patients. The Act specifies two methods 

for a hospital to qualify for the Medicare 

disproportionate share hospital (DSH) 

adjustment. Under the first method, 

hospitals that are located in an urban 

area and have 100 or more beds may 

receive a DSH payment adjustment if 

the hospital can demonstrate that, 

during its cost reporting period, more 

than 30 percent of its net inpatient care 

revenues are derived from State and 

local government payments for care 

furnished to indigent patients. These 

hospitals are commonly known as 

‘‘Pickle hospitals.’’ The second method, 

which is also the most commonly used 

method for a hospital to qualify, is 

based on a complex statutory formula 

under which payment adjustments are 

based on the level of the hospital’s DSH 

patient percentage, which is the sum of 

two fractions: the ‘‘Medicare fraction’’

and the ‘‘Medicaid fraction.’’ The 

Medicare fraction is computed by 

dividing the number of patient days that 

are furnished to patients who were 

entitled to both Medicare Part A and 

Supplemental Security Income (SSI) 

benefits by the total number of patient 

days furnished to patients entitled to 

benefits under Medicare Part A. The 

Medicaid fraction is computed by 

dividing the number of patient days 

furnished to patients who, for those 

days, were eligible for Medicaid but 

were not entitled to benefits under 

Medicare Part A by the number of total 

hospital patient days in the same 

period. 

DSH

Patient

Percentage

Medicare Medicaid

= + , , SSI Days

Total Medicare Days

 Non-Medicare Days

Total Patient Days

2. Implementation of Section 951 of 

Pub. L. 108–173 (MMA) 

Section 951 of Pub. L. 108–173 

requires the Secretary to arrange to 

furnish the data necessary for hospitals 

to compute the number of patient days 

used in calculating the disproportionate 

patient percentages. The provision is 

not specific as to whether it applies to 

the patient day data used to determine 

the Medicare fraction or the Medicaid 

fraction. We are interpreting section 951 

to require the Secretary to arrange to 

furnish to hospitals the data necessary 

to calculate both the Medicare and 

Medicaid fractions. With respect to both 

the Medicare and Medicaid fractions, 

we also are interpreting section 951 to 

require CMS to arrange to furnish the 

personally identifiable information that 

would enable a hospital to compare and 

verify its records, in the case of the 

Medicare fraction, against the CMS’

records, and in the case of the Medicaid 

fraction, against the State Medicaid 

agency’s records. Currently, as 

explained in more detail below, CMS 

provides the Medicare SSI days to 

certain hospitals that request these data. 

Hospitals are currently required under 

the regulation at § 412.106(b)(4)(iii) to 

provide the data adequate to prove 

eligibility for the Medicaid, nonMedicare days. 

As indicated above, the numerator of 

the Medicare fraction includes the 

number of patient days furnished by the 

hospital to patients who were entitled to 

both Medicare Part A and SSI benefits. 

This number is divided by the hospital’s 

total number of patient days furnished 

to patients entitled to benefits under 

Medicare Part A. In order to determine 

the numerator of this fraction for each 

hospital, CMS obtains a data file from 

the Social Security Administration 

(SSA). CMS matches personally 

identifiable information from the SSI 

file against its Medicare Part A 

entitlement information for the fiscal 

year to determine the number of 

Medicare SSI days for each hospital 

during each fiscal year. These data are 

maintained in the MedPAR Limited 

Data Set (LDS) as described in more 

detail below and discussed in a notice 

published on August 18, 2000 in the 

Federal Register (65 FR 50548). The 

number of patient days furnished by the 

hospital to Medicare beneficiaries 

entitled to SSI is divided by the 

hospital’s total number of Medicare 

days (the denominator of the Medicare 

fraction). CMS determines this number 

from Medicare claims data; hospitals 

also have this information in their 

records. The Medicare fraction for each 

hospital is posted on the CMS Web site 

(http://www.cms.hhs.gov) under the 

SSI/Medicare Part A Disproportionate 

Share Percentage File. Under current 

regulations at § 412.106(b)(3), a hospital 

may request to have its Medicare 

fraction recomputed based on the 

hospital’s cost reporting period if that 

year differs from the Federal fiscal year. 

This request may be made only once per 


EP04my05.088</GPH>
Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23435 

4Bear in mind that States and hospitals should, 

in keeping with the HIPAA Privacy Rule, limit the 

data exchanged in the context of these inquiries and 

responses to the minimum necessary to accomplish 

the task 

cost reporting period, and the hospital 

must accept the resulting DSH 

percentage for that year, whether or not 

it is a more favorable number than the 

DSH percentage based on the Federal 

fiscal year. 

In accordance with section 951 of 

Pub. L. 108–173, we are proposing to 

change the process that we use to make 

Medicare data used in the DSH 

calculation available to hospitals. 

Currently, as stated above, CMS 

calculates the Medicare fraction for each 

section 1886(d) hospital using data from 

the MedPAR LDS (as established in a 

notice published in the August 18, 2000 

Federal Register (65 FR 50548)). The 

MedPAR LDS contains a summary of all 

services furnished to a Medicare 

beneficiary, from the time of admission 

through discharge, for a stay in an 

inpatient hospital or skilled nursing 

facility, or both; SSI eligibility 

information; and enrollment data on 

Medicare beneficiaries. The MedPAR 

LDS is protected by the Privacy Act of 

1974 (5 U.S.C. 552a) and the Privacy 

Rule of the Health Insurance Portability 

and Accountability Act of 1996 (Pub. L. 

104–191). The Privacy Act allows us to 

disclose information without an 

individual’s consent if the information 

is to be used for a purpose that is 

compatible with the purpose(s) for 

which the information was collected. 

Any such compatible use of data is 

known as a ‘‘routine use.’’ In order to 

obtain this privacy-protected data, the 

hospital must qualify under the routine 

use that was described in the August 18, 

2000 Federal Register. Currently, a 

hospital qualifies under the routine use 

if it has an appeal properly pending 

before the Provider Reimbursement 

Review Board (PRRB) or before an 

intermediary on the issue of whether it 

is entitled to DSH payments, or the 

amount of such payments. Once 

determined eligible to receive the data 

under the routine use, the hospital is 

then required to sign a data use 

agreement with CMS to ensure that the 

data are appropriately used and 

protected, and pay the requisite fee. 

Beginning with cost reporting periods 

that include December 8, 2004 (within 

one year of the date of enactment of 

Pub. L. 108–173), we are proposing to 

furnish MedPAR LDS data for a 

hospital’s patients eligible for both SSI 

and Medicare at the hospital’s request, 

regardless of whether there is a properly 

pending appeal relating to DSH 

payments. We are proposing to make the 

information available for either the 

Federal fiscal year or, if the hospital’s 

fiscal year differs from the Federal fiscal 

year, for the months included in the two 

Federal fiscal years that encompass the 

hospital’s cost reporting period. Under 

our proposal, the hospital could use 

these data to calculate and verify its 

Medicare fraction, and to decide 

whether it prefers to have the fraction 

determined on the basis of its fiscal year 

rather than a Federal fiscal year. The 

data set made available to hospitals 

would be the same data set CMS uses to 

calculate the Medicare fractions for the 

Federal fiscal year. 

Because we interpret section 951 to 

require the Secretary to arrange to 

furnish these data, we do not believe 

that it will continue to be appropriate to 

charge hospitals to access the data. 

These proposed changes would require 

CMS to modify the current routine use 

for the MedPAR LDS to reflect changes 

in the data provided and the 

circumstances under which they are 

made available to hospitals. In a future 

Federal Register document, we will 

publish the details of any necessary 

modifications to the current routine use 

to implement section 951 of Pub. L. 

108–173. We welcome comments on all 

aspects of these proposed changes. 

The numerator of the Medicaid 

fraction includes hospital inpatient days 

that are furnished to patients who, for 

those days, were eligible for Medicaid 

but were not entitled to benefits under 

Medicare Part A. Under the regulation at 

§ 412.106(b)(4)(iii), hospitals are 

responsible for proving Medicaid 

eligibility for each Medicaid patient day 

and verifying with the State that 

patients were eligible for Medicaid on 

the claimed days. The number of 

Medicaid, non-Medicare days is divided 

by the hospital’s total number of 

inpatient days in the same period. Total 

inpatient days are reported on the 

Medicare cost report. (This number is 

also available in the hospital’s own 

records.) 

Much of the data used to calculate the 

Medicaid fraction of the DSH patient 

percentage are available to hospitals 

from their own records or from the 

States. We recognize that Medicaid State 

plans are only permitted to use and 

disclose information concerning 

applicants and recipients for ‘‘purposes 

directly connected with the 

administration of the [State] plan’’

under section 1902(a)(7) of the Act. 

Regulations at 42 CFR 431.302 define 

these purposes to include establishing 

eligibility (§ 431.302(a)) and 

determining the amount of medical 

assistance (§ 431.302(b)). Thus, State 

plans are permitted under the currently 

applicable statutory and regulatory 

provisions governing the disclosure of 

individually identifiable data on 

Medicaid applicants and recipients to 

provide hospitals the data needed to 

meet their obligation under 

§ 412.106(b)(4)(iii) in the context of 

either an ‘‘eligibility inquiry’’ with the 

State plan or in order to assist the 

hospital, and thus the State plan, in 

determining the amount of medical 

assistance. 

In the process of developing a plan for 

implementing section 951 with respect 

to the data necessary to calculate the 

Medicaid fraction, we asked our 

regional offices to report on the 

availability of this information to 

hospitals and on any problems that 

hospitals face in obtaining the 

information that they need. The 

information we received suggested that, 

in the vast majority of cases, there are 

established procedures for hospitals or 

their authorized representatives to 

obtain the information needed for 

hospitals to meet their obligation under 

§ 412.106(b)(4)(iii) and to calculate their 

Medicaid fraction. There is no uniform 

national method for hospitals to verify 

Medicaid eligibility for a specific 

patient on a specific day. For instance, 

some States, such as Arizona, have 

secure online systems that providers 

may use to check eligibility information. 

However, in most States, providers send 

a list of patients to the State Medicaid 

office for verification. Other States, such 

as Hawaii, employ a third party private 

company to maintain the Medicaid 

database and run eligibility matches for 

providers. The information that 

providers submit to State plans (or third 

party contractors) differs among States 

as well. Most States require the patient’s 

name, date of birth, gender, social 

security number, Medicaid 

identification, and admission and 

discharge dates. States or the third 

parties may respond with either ‘‘Yes/ 

No’’ or with more detailed Medicaid 

enrollment and eligibility information 

such as whether or not the patient is a 

dual-eligible, whether the patient is 

enrolled in a fee-for-service or HMO 

plan, and under which State assistance 

category the individual qualified for 

Medicaid.4

We note that we have been made 

aware of at least one instance in which 

a State is concerned about providing 

hospitals with the requisite eligibility 

data. We understand that the basis for 

the State’s objections is section 

1902(a)(7) of the Act. The State is 

concerned that section 1902(a)(7) of the 

Act prohibits the State from providing 

eligibility data for any purpose other 

than a purpose related to State plan 

23436 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

administration. However, as described 

above, we believe that States are 

permitted to verify Medicaid eligibility 

for hospitals as a purpose directly 

related to State plan administration 

under § 431.302. 

In addition, we believe it is 

reasonable to continue to place the 

burden of furnishing the data adequate 

to prove eligibility for each Medicaid 

patient day claimed for DSH percentage 

calculation purposes on hospitals 

because, since they have provided 

inpatient care to these patients for 

which they billed the relevant payors, 

including the State Medicaid plan, they 

will necessarily already be in possession 

of much of this information. We 

continue to believe hospitals are best 

situated to provide and verify Medicaid 

eligibility information. Although we 

believe the mechanisms are currently in 

place to enable hospitals to obtain the 

data necessary to calculate their 

Medicaid fraction of the DSH patient 

percentage, there is currently no 

mandatory requirement imposed upon 

State Medicaid agencies to verify 

eligibility for hospitals. At this point, 

we believe there is no need to modify 

the Medicaid State plan regulations to 

require that State plans verify Medicaid 

eligibility for hospitals. However, 

should we find that States are not 

voluntarily providing or verifying 

Medicaid eligibility information for 

hospitals, we will consider amending 

the State plan regulations to add a 

requirement that State plans provide 

certain eligibility information to 

hospitals. 

H. Geographic Reclassifications 

(§§ 412.103 and 412.230) 

(If you choose to comment on issues 

in this section, please include the 

caption ‘‘Geographic Reclassifications’’

at the beginning of your comment.) 

1. Background 

With the creation of the MGCRB, 

beginning in FY 1991, under section 

1886(d)(10) of the Act, hospitals could 

request reclassification from one 

geographic location to another for the 

purpose of using the other area’s 

standardized amount for inpatient 

operating costs or the wage index value, 

or both (September 6, 1990 interim final 

rule with comment period (55 FR 

36754), June 4, 1991 final rule with 

comment period (56 FR 25458), and 

June 4, 1992 proposed rule (57 FR 

23631)). As a result of legislative 

changes under section 402(b) of Pub. L. 

108–7, Pub. L. 108–89, and section 401 

of Pub. L. 108–173, the standardized 

amount reclassification criterion for 

large urban and other areas is no longer 

necessary or appropriate and has been 

removed from our reclassification policy 

(69 FR 49103). We implemented this 

provision in the FY 2005 IPPS final rule 

(69 FR 49103). As a result, hospitals can 

request reclassification for the purposes 

of the wage index only and not the 

standardized amount. Implementing 

regulations in Subpart L of Part 412 

(§§ 412.230 et seq.) set forth criteria and 

conditions for reclassifications for 

purposes of the wage index from rural 

to urban, rural to rural, or from an urban 

area to another urban area, with special 

rules for SCHs and rural referral centers. 

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

Act, an urban hospital may file an 

application to be treated as being 

located in a rural area if certain 

conditions are met. The regulations 

implementing this provision are located 

under § 412.103. 

Effective with reclassifications for FY 

2003, section 1886(d)(10)(D)(vi)(II) of 

the Act provides that the MGCRB must 

use the average of the 3 years of hourly 

wage data from the most recently 

published data for the hospital when 

evaluating a hospital’s request for 

reclassification. The regulations at 

§ 412.230(d)(2)(ii) stipulate that the 

wage data are taken from the CMS 

hospital wage survey used to construct 

the wage index in effect for prospective 

payment purposes. To evaluate 

applications for wage index 

reclassifications for FY 2006, the 

MGCRB used the 3-year average hourly 

wages published in Table 2 of the 

August 11, 2004 IPPS final rule (69 FR 

49295). These average hourly wages are 

taken from data used to calculate the 

wage indexes for FY 2003, FY 2004, and 

FY 2005, based on cost reporting 

periods beginning during FY 1999, FY 

2000, and FY 2001, respectively. 

2. Multicampus Hospitals (§ 412.230) 

As discussed in section III.B. of this 

preamble, on June 6, 2003, the OMB 

announced the new CBSAs, comprised 

of Metropolitan Statistical Areas (MSAs) 

and Micropolitan Statistical Areas, 

based on Census 2000 data. Effective 

October 1, 2004, for the IPPS, we 

implemented new labor market areas 

based on the CBSA definitions of MSAs. 

In some cases, the new CBSAs resulted 

in previously existing MSAs being 

divided into two or more separate labor 

market areas. In the FY 2005 IPPS final 

rule (69 FR 48916), we acknowledged 

that the implementation of the new 

MSAs would have a considerable 

impact on hospitals. Therefore, we 

made every effort to implement 

transitional provisions that would 

mitigate the negative effects of the new 

labor market areas on hospitals that 

request reclassification to another area 

for purposes of the wage index and on 

all hospitals. 

Subsequent to the publication of the 

FY 2005 IPPS final rule, we became 

aware of a situation in which, as a result 

of the new labor market areas, a 

multicampus hospital previously 

located in a single MSA is now located 

in more than one CBSA. Under our 

current policy, a multicampus hospital 

with campuses located in the same labor 

market area receives a single wage 

index. However, if the campuses are 

located in more than one labor market 

area, payment for each discharge is 

determined using the wage index value 

for the MSA (or metropolitan division, 

where applicable) in which the campus 

of the hospital is located. In addition, 

the current provision set forth in section 

2779F of the Medicare State Operations 

Manual provides that, in the case of a 

merger of hospitals, if the merged 

facilities operate as a single institution, 

the institution must submit a single cost 

report, which necessitates a single 

provider identification number. This 

provision does not differentiate between 

merged facilities in a single wage index 

area or in multiple wage index areas. As 

a result, the wage index data for the 

merged facility is reported for the entire 

entity on a single cost report. 

The current criteria for a hospital 

being reclassified to another wage area 

by the MGCRB do not address the 

circumstances under which a single 

campus of a multicampus hospital may 

seek reclassification. That is, a hospital 

must provide data from the CMS 

hospital wage survey for the average 

hourly wage comparison that is used to 

support a request for reclassification. 

However, because a multicampus 

hospital is required to report data for the 

entire entity on a single cost report, 

there is no wage survey data for the 

individual hospital campus that can be 

used in a reclassification application. In 

an effort to remedy this situation, for FY 

2007 and subsequent year 

reclassifications, we are proposing to 

allow a campus of a multicampus 

hospital system that wishes to seek 

geographic reclassification to another 

labor market area to report campusspecific wage data using a supplemental 

Form S–3 (CMS’ manual version of 

Worksheet S–3) for purposes of the 

wage data comparison. These data 

would then constitute the appropriate 

wage data under § 412.232(d)(2) for 

purposes of comparing the hospital’s 

wages to the wages of hospitals in the 

area to which it seeks reclassification as 

well as the area in which it is located. 

Before the data could be used in a 

reclassification application, the 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23437 

hospital’s fiscal intermediary would 

have to review the allocation of the 

entire hospital’s wage data among the 

individual campuses. 

For FY 2006 reclassification 

applications, we are proposing to allow 

a campus of a multicampus hospital 

system to use the average hourly wage 

data submitted for the entire 

multicampus hospital system as its 

appropriate wage data under 

§ 412.232(d)(2). We are establishing this 

special rule for FY 2006 reclassifications 

because the deadline for submitting an 

application to the MGCRB was 

September 1, 2004, and there no longer 

is an opportunity to provide a 

Supplemental Form S–3 that allocates 

the wage data by individual hospital 

campus. This special rule will be 

applied only to an individual campus of 

a multicampus hospital system that 

made an application for reclassification 

for FY 2006 and that otherwise meets all 

of the reclassification criteria. We do not 

believe that the special rule is necessary 

for reclassifications for FY 2007 because 

the deadline for making those 

applications has not yet passed and a 

hospital seeking reclassification will be 

able to provide the Supplemental Form 

S–3 that allocates the wage data by 

individual hospital campus. We are 

proposing to apply these new criteria to 

geographic reclassification applications 

that were received by September 1, 

2004, and that will take effect for FY 

2006. 

We are proposing to revise the 

regulations at § 412.230(d)(2) by 

redesignating paragraph (d)(2)(iii) as 

paragraph (d)(2)(v) and adding new 

paragraph (d)(2))(iii) and (d)(2)(iv) to 

incorporate the proposed new criteria 

for multicampus hospitals. 

3. Urban Group Hospital 

Reclassifications 

In FY 2005 IPPS final rule (69 FR 

49104), we set forth, under 

§ 412.234(a)(3)(ii), revised criteria for 

urban hospitals to be reclassified as a 

group. After the publication of the final 

rule, we became aware that portions of 

our policy discussion with respect to 

the implementing decision were 

inadvertently omitted. This policy was 

corrected in the October 7, 2004, 

correction to the final rule (69 FR 

60248). The correction specified that 

‘‘hospitals located in counties that are in 

the same Combined Statistical Area 

(under the MSA definitions announced 

by the OMB on June 6, 2003); or in the 

same Consolidated Metropolitan 

Statistical Area (CMSA) (under the 

standards published by the OMB on 

March 30, 1990) as the urban area to 

which they seek redesignation qualify as 

meeting the proximity requirement for 

reclassification to the urban area to 

which they seek redesignation.’’

In making the determination to revise 

our urban group reclassification policy, 

we took into consideration the 

magnitude of the changes that would 

have resulted from our adoption of the 

new labor market areas. The resulting 

policy was intended to preserve the 

reclassification opportunities for urban 

county groups; in other words, an 

eligible urban county group would have 

to meet either the CSA or CMSA 

criteria, but not both to be eligible for 

consideration. 

As a result of adopting the new labor 

market area definitions, we reexamined 

the appropriateness of the FY 2005 

changes with emphasis on determining 

whether including ‘‘* * * or in the 

same Consolidated Metropolitan 

Statistical Area (CMSA) (under the 

standards published by the OMB on 

March 30, 1990)’’ as a qualifying 

criterion, is necessary or consistent with 

our plans to fully implement the new 

labor area market definitions. 

Based on our experiences now that 

the new labor market areas are in effect 

and since we revised the urban county 

group regulations, we no longer think it 

is necessary to retain use of a 1990- 

based standard as a criterion for 

determining whether an urban county 

group is eligible for reclassification. We 

believe it is reasonable to use the area 

definitions that are based on the most 

recent statistics; in other words, the 

CSA standard. Therefore, we are 

proposing to delete § 412.234(a)(3)(ii) to 

remove reference to the CMSA 

eligibility criterion. Beginning with FY 

2006, we are proposing to require that 

hospitals must be located in counties 

that are in the same Combined 

Statistical Area (under the MSA 

definitions announced by the OMB on 

June 6, 2003) as the urban area to which 

they seek redesignation to qualify as 

meeting the proximity requirement for 

reclassification to the urban area to 

which they seek redesignation. We 

believe that this proposed change would 

improve the overall consistency of our 

policies by using a single labor market 

area definition for all aspects of the 

wage index and reclassification. 

4. Clarification of Goldsmith 

Modification Criterion for Urban 

Hospitals Seeking Reclassification as 

Rural 

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

Act, certain urban hospitals may file an 

application for reclassification as rural if 

the hospital meets certain criteria. One 

of these criteria is that the hospital is 

located in a rural census tract of a 

CBSA, as determined under the most 

recent version of the Goldsmith 

Modification as determined by the 

Office of Rural Health Policy. This 

provision is implemented in our 

regulations at § 412.103(a)(1). 

The original Goldsmith Modification 

was developed using data from the 1980 

census. In order to more accurately 

reflect current demographic and 

geographic characteristics of the Nation, 

the Office of Rural Health Policy, in 

partnership with the Department of 

Agriculture’s Economic Research 

Service and the University of 

Washington, has developed the RuralUrban Commuting Area codes (RUCAs) 

(69 FR 47518 through 47529, August 5, 

2004). Rather than being limited to large 

area metropolitan counties (LAMCs), 

RUCAs use urbanization, population 

density, and daily commuting data to 

categorize every census tract in the 

country. RUCAs are the updated version 

of the Goldsmith Modification and are 

used to identify rural census tracts in all 

metropolitan counties. 

We are proposing to update the 

Medicare regulations at § 412.103(a)(1) 

to incorporate this change in the 

identification of rural census tracts. We 

are also proposing to update the website 

and the agency location at which the 

RUCA codes are accessible. 

5. Cross-Reference Changes 

In the FY 2005 IPPS final rule, in 

conjunction with changes made by 

various sections of Pub. L. 108–173 and 

changes in the OMB standards for 

defining labor market areas, we 

established a new § 412.64 governing 

rules for establishing Federal rates for 

inpatient operating costs for FY 2005 

and subsequent years. In this new 

section, we included definitions of 

‘‘urban’’ and ‘‘rural’’ for the purpose of 

determining the geographic location or 

classification of hospitals under the 

IPPS. These definitions were previous 

located in § 412.63(b), applicable to FYs 

1985 through 2004, and in § 412.62(f), 

applicable to FY 1984. References to the 

definitions under § 412.62(f) and 

§ 412.63(b), appear throughout 42 CFR 

Chapter IV. However, when we finalized 

the provisions of § 412.64, we 

inadvertently omitted updating some of 

these cross-references to reflect the 

change in the location of the two 

definitions for FYs 2005 and subsequent 

years. We are proposing to change the 

cross-references to the definitions of 

‘‘urban’’ and ‘‘rural’’ to reflect their 

current locations in Subpart D of Part 

412, as applicable. 

23438 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

I. Payment for Direct Graduate Medical 

Education (§ 413.79) 

(If you choose to comment on issues 

in this section, please include the 

caption ‘‘Graduate Medical Education’’

at the beginning of your comment.) 

1. Background 

Section 1886(h) of the Act, as added 

by section 9202 of the Consolidated 

Omnibus Budget Reconciliation Act 

(COBRA) of 1985 (Pub. L. 99–272) and 

implemented in regulations at existing 

§§ 413.75 through 413.83, establishes a 

methodology for determining payments 

to hospitals for the costs of approved 

graduate medical education (GME) 

programs. Section 1886(h)(2) of the Act, 

as added by COBRA, sets forth a 

payment methodology for the 

determination of a hospital-specific, 

base-period per resident amount (PRA) 

that is calculated by dividing a 

hospital’s allowable costs of GME for a 

base period by its number of residents 

in the base period. The base period is, 

for most hospitals, the hospital’s cost 

reporting period beginning in FY 1984 

(that is, the period of beginning between 

October 1, 1983, through September 30, 

1984). Medicare direct GME payments 

are calculated by multiplying the PRA 

times the weighted number of full-time 

equivalent (FTE) residents working in 

all areas of the hospital (and 

nonhospital sites, when applicable), and 

the hospital’s Medicare share of total 

inpatient days. In addition, as specified 

in section 1886(h)(2)(D)(ii) of the Act, 

for cost reporting periods beginning on 

or after October 1, 1993, through 

September 30, 1995, each hospitalspecific PRA for the previous cost 

reporting period is not updated for 

inflation for any FTE residents who are 

not either a primary care or an obstetrics 

and gynecology resident. As a result, 

hospitals that train primary care and 

obstetrics and gynecology residents, as 

well as nonprimary care residents in FY 

1994 or FY 1995, have two separate 

PRAs: One for primary care and 

obstetrics and gynecology residents and 

one for nonprimary care residents. 

Pub. L. 106–113 amended section 

1886(h)(2) of the Act to establish a 

methodology for the use of a national 

average PRA in computing direct GME 

payments for cost reporting periods 

beginning on or after October 1, 2000, 

and on or before September 30, 2005. 

Pub. L. 106–113 established a ‘‘floor’’ for 

hospital-specific PRAs equal to 70 

percent of the locality-adjusted national 

average PRA. In addition, the BBRA 

established a ‘‘ceiling’’ that limited the 

annual adjustment to a hospital-specific 

PRA if the PRA exceeded 140 percent of 

the locality-adjusted national average 

PRA. Section 511 of the BIPA (Pub. L. 

106–554) increased the floor established 

by the BBRA to equal 85 percent of the 

locality-adjusted national average PRA. 

Existing regulations at § 413.77(d)(2)(iii) 

specify that, for purposes of calculating 

direct GME payments, each hospitalspecific PRA is compared to the floor 

and the ceiling to determine whether a 

hospital-specific PRA should be revised. 

Section 1886(h)(4)(F) of the Act 

established limits on the number of 

allopathic and osteopathic residents that 

hospitals may count for purposes of 

calculating direct GME payments. For 

most hospitals, the limits were the 

number of allopathic and osteopathic 

FTE residents training in the hospital’s 

most recent cost reporting period ending 

on or before December 31, 1996. 

2. Direct GME Initial Residency Period 

(IRP) § 413.79(a)(10) 

a. Background 

As we have generally described 

above, the amount of direct GME 

payment to a hospital is based in part 

on the number of FTE residents the 

hospital is allowed to count for direct 

GME purposes during a year. The 

number of FTE residents, and thus the 

amount of direct GME payment to a 

hospital, is directly affected by CMS 

policy on how ‘‘initial residency 

periods’’ are determined for residents. 

Section 1886(h)(4)(C)(ii) of the Act, 

implemented at § 413.79(b)(1), provides 

that while a resident is in the ‘‘initial 

residency period’’ (IRP), the resident is 

weighted at 1.00. Section 

1886(h)(4)(C)(iii) of the Act, 

implemented at § 413.79(b)(2), requires 

that if a resident is not in the resident’s 

IRP, the resident is weighted at .50 FTE 

resident. 

Section 1886(h)(5)(F) of the Act 

defines ‘‘initial residency period’’ as the 

‘‘period of board eligibility,’’ and, 

subject to specific exceptions, limits the 

initial residency period to an ‘‘aggregate 

period of formal training’’ of no more 

than 5 years for any individual. Section 

1886(h)(5)(G) of the Act generally 

defines ‘‘period of board eligibility’’ for 

a resident as ‘‘the minimum number of 

years of formal training necessary to 

satisfy the requirements for initial board 

eligibility in the particular specialty for 

which the resident is training.’’ Existing 

§ 413.79(a) of the regulations generally 

defines ‘‘initial residency period’’ as the 

‘‘minimum number of years required for 

board eligibility.’’ Existing § 413.79(a)(5) 

provides that ‘‘time spent in residency 

programs that do not lead to 

certification in a specialty or 

subspecialty, but that otherwise meet 

the definition of approved programs 

* * * is counted toward the initial 

residency period limitation.’’ Section 

1886(h)(5)(F) of the Act further provides 

that ‘‘the initial residency period shall 

be determined, with respect to a 

resident, as of the time the resident 

enters the residency training program.’’

The IRP is determined as of the time 

the resident enters the ‘‘initial’’ or first 

residency training program and is based 

on the period of board eligibility 

associated with that medical specialty. 

Thus, these provisions limit the amount 

of FTE resident time that may be 

counted for a resident who, after 

entering a training program in one 

specialty, switches to a program in a 

specialty with a longer period of board 

eligibility or completes training in one 

specialty training program and then 

continues training in a subspecialty (for 

example, cardiology and 

gastroenterology are subspecialties of 

internal medicine). 

b. Direct GME Initial Residency Period 

Limitation: Simultaneous Match 

We understand that there are 

numerous programs, including 

anesthesiology, dermatology, 

psychiatry, and radiology, that require a 

year of generalized clinical training to 

be used as a prerequisite for the 

subsequent training in the particular 

specialty. For example, in order to 

become board eligible in anesthesiology, 

a resident must first complete a 

generalized training year and then 

complete 3 years of training in 

anesthesiology. This first year of 

generalized residency training is 

commonly known as the ‘‘clinical base 

year.’’ Often, the clinical base year 

requirement is fulfilled by completing 

either a preliminary year in internal 

medicine (although the preliminary year 

can also be in other specialties such as 

general surgery or family practice), or a 

transitional year program (which is not 

associated with any particular medical 

specialty). 

In many cases, during the final year 

of medical school, medical students 

apply for training in specialty residency 

training programs. Typically, a medical 

student who wants to train to become a 

specialist is ‘‘matched’’ to both the 

clinical base year program and the 

specialty residency training program at 

the same time. For example, the medical 

student who wants to become an 

anesthesiologist will apply and ‘‘match’’

simultaneously for a clinical base year 

in an internal medicine program for year 

1 and for an anesthesiology training 

program beginning in year 2. 

Prior to October 1, 2004, CMS’ policy 

was that the IRP is determined for a 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23439 

resident based on the program in which 

he or she participates in the resident’s 

first year of training, without regard to 

the specialty in which the resident 

ultimately seeks board certification. 

Therefore, for example, a resident who 

chooses to fulfill the clinical base year 

requirement for an anesthesiology 

program with a preliminary year in an 

internal medicine program will be 

‘‘labeled’’ with the IRP associated with 

internal medicine, that is, 3 years (3 

years of training are required to become 

board eligible in internal medicine), 

even though the resident may seek 

board certification in anesthesiology, 

which requires a minimum of 4 years of 

training to become board eligible. As a 

result, this resident would have an IRP 

of 3 years and, therefore, be weighted at 

0.5 FTE in his or her fourth year of 

anesthesiology training for purposes of 

direct GME payment. 

Effective with cost reporting periods 

beginning on or after October 1, 2004, to 

address programs that require a clinical 

base year, we revised our policy in the 

FY 2005 IPPS final rule (69 FR 49170 

through 49174) concerning the IRP. 

Specifically, under the revised policy, if 

a hospital can document that a 

particular resident matches 

simultaneously for a first year of 

training in a clinical base year in one 

medical specialty, and for additional 

year(s) of training in a different 

specialty program, the resident’s IRP 

will be based on the period of board 

eligibility associated with the specialty 

program in which the resident matches 

for the subsequent year(s) of training 

and not on the period of board 

eligibility associated with the clinical 

base year program. This change in 

policy is codified at § 413.79(a)(10) of 

the regulations. 

This policy applies regardless of 

whether the resident completes the first 

year of training in a separately 

accredited transitional year program or 

in a preliminary (or first) year in another 

residency training program such as 

internal medicine. 

In addition, because programs that 

require a clinical base year are 

nonprimary care specialties, we 

specified in § 413.79(a)(10) that the 

nonprimary care PRA would apply for 

the entire duration of the initial 

residency period. By treating the first 

year as part of a nonprimary care 

specialty program, the hospital will be 

paid at the lower nonprimary care PRA 

rather than the higher primary care 

PRA, even if the residents are training 

in a primary care program during the 

clinical base year. 

In the FY 2005 IPPS final rule (69 FR 

49170 and 49171), we also defined 

‘‘residency match’’ to mean, for 

purposes of direct GME, a national 

process by which applicants to 

approved medical residency programs 

are paired with programs on the basis of 

preferences expressed by both the 

applicants and the program directors. 

These policy changes, which were 

effective October 1, 2004, are only 

applicable to residents that 

simultaneously match in both a clinical 

base year program and a longer specialty 

residency program. We have become 

aware of situations where residents, 

upon completion of medical school, 

only match for a program beginning in 

the second residency year in an 

advanced specialty training program but 

fail to match for a clinical base year of 

training. Residents that match into an 

advanced program but fail to match into 

a clinical base year program may 

independently pursue unfilled 

residency positions in preliminary year 

programs after the match process is 

complete. However, because these 

residents do not ‘‘simultaneously 

match’’ into both a preliminary year and 

an advanced program, currently their 

IRP cannot be determined based on the 

period of board eligibility associated 

with the advanced program, as specified 

in § 413.79(a)(10). Rather, the IRP for 

such residents would continue to be 

determined based on the specialty 

associated with the preliminary year 

program. For example, a student in the 

final year of medical school may match 

into a radiology program that begins in 

the second residency year, but not 

match with any clinical base year 

program. Under our current policy, if 

subsequent to conclusion of the match 

process, this resident secured a 

preliminary year position in an internal 

medicine program, the resident would 

not have met the requirements at 

§ 413.79(a)(10) for a simultaneous match 

and the IRP for this resident would be 

based on the length of time required to 

complete an internal medicine program 

(3 years) rather than the length of the 

radiology program (4 years). 

The intent of the ‘‘simultaneous 

match’’ provision of § 413.79(a)(10) is to 

identify in a verifiable manner the 

specialty associated with the program in 

which the resident will initially train 

and seek board certification. It is also 

the intent of § 413.79(a)(10) that a 

resident’s IRP would not change if the 

resident, after initially entering a 

training program in one specialty, 

changes programs to train in another 

medical specialty. The ‘‘simultaneous 

match’’ provisions of § 413.79(a)(10) 

allow CMS to both identify the specialty 

associated with the program in which 

the resident is ultimately expected to 

train and seek board certification and 

prevent inappropriate revision of the 

IRP in cases where a resident changes 

specialties subsequent to beginning 

residency training. However, we note 

that when a medical student in his or 

her final year of medical school matches 

into an advanced program (for example, 

anesthesiology) for the second program 

year, but fails to match in a clinical base 

year, and obtains a preliminary year 

position outside the match process, we 

can still identify the specialty associated 

with the program in which the resident 

is ultimately expected to train and seek 

board certification and prevent 

inappropriate changes to the IRP if the 

resident changes specialties subsequent 

to beginning residency training. 

Therefore, we are proposing to revise 

§ 413.79(a)(10) to state that, when a 

hospital can document that a resident 

matched in an advanced residency 

training program beginning in the 

second residency year prior to 

commencement of any residency 

training, the resident’s IRP will be 

determined based on the period of board 

eligibility for the specialty associated 

with the advanced program, without 

regard to the fact that the resident had 

not matched for a clinical base year 

training program. 

We note that this proposed policy 

change would not result in a policy to 

determine the IRP for all residents who 

must complete a clinical base year 

during the second residency training 

year based on the specialty associated 

with that second residency training 

year. That is, we are not proposing that, 

for any resident whose first year of 

training is completed in a program that 

provides a general clinical base year as 

required by the ACGME for certain 

specialties, an IRP should be assigned in 

the second year based on the specialty 

the resident enters in the second year of 

training. As we stated in the FY 2005 

IPPS final rule (69 FR 49172), a ‘‘second 

year’’ policy would not allow CMS to 

distinguish between those residents 

who, in their second year of training, 

match in a specialty program prior to 

their first year of training, those 

residents who participated in a clinical 

base year in a specialty and then 

continued training in that specialty, and 

those residents who simply switched 

specialties in their second year. Rather, 

we are proposing that, if a hospital can 

document that a particular resident had 

matched in an advanced specialty 

program that requires completion of a 

clinical base year prior to the resident’s 

first year of training, the IRP would not 

be determined based on the period of 

board eligibility for the specialty 

associated with the clinical base year 

23440 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

program, for purposes of direct GME 

payment. Rather, under those 

circumstances, the IRP would be 

determined based upon the period of 

board eligibility associated with the 

specialty program in which the resident 

has matched and is expected to begin 

training in the second program year. 

3. New Teaching Hospitals’

Participation in Medicare GME 

Affiliated Groups (§ 413.79(e)(1)) 

In the August 29, 1997 final rule (62 

FR 46005 through 46006) and the May 

12, 1998 final rule (63 FR 26331 through 

23336), we established rules for 

applying the FTE resident limit (or ‘‘FTE 

cap’’) for calculating Medicare direct 

GME and IME payments to hospitals. 

We added regulations, currently at 

§ 413.79(e), to provide for an adjustment 

to the FTE cap for certain hospitals that 

begin training residents in new medical 

residency training programs. For 

purposes of this provision, a new 

program is one that receives initial 

accreditation or begins training 

residents on or after January 1, 1995. 

Although we refer only to the direct 

GME provision throughout the 

remainder of this discussion, a similar 

cap adjustment is made under 

§ 412.105(f) for IME purposes. 

Therefore, this proposal applies to both 

IME and direct GME. 

A new teaching hospital is one that 

had no allopathic or osteopathic 

residents in its most recent cost 

reporting period ending on or before 

December 31, 1996. Under 

§ 413.79(e)(1), if a new teaching hospital 

establishes one or more new medical 

residency training programs, the 

hospital’s unweighted FTE caps for both 

direct GME and IME will be based on 

the product of the highest number of 

FTE residents in any program year in 

the third year of the hospital’s first new 

program and the number of years in 

which residents are expected to 

complete the program(s), based on the 

minimum number of years of training 

that are accredited for the type of 

program(s). 

The regulations at § 413.79(e)(1)(iv) 

specify that hospitals in urban areas that 

qualify for an FTE cap adjustment for 

residents in newly approved programs 

under § 413.79(e)(1) are not permitted to 

be part of a Medicare GME affiliated 

group for purposes of establishing an 

aggregate FTE cap. (A Medicare GME 

affiliated group is defined in the 

regulations at § 413.75(b).) We 

established this policy because of our 

concern that hospitals with existing 

medical residency training programs 

could otherwise, with the cooperation of 

new teaching hospitals, circumvent the 

statutory FTE resident caps by 

establishing new medical residency 

programs in the new teaching hospitals 

solely for the purpose of affiliating with 

the new teaching hospitals to receive an 

upward adjustment to their FTE cap 

under an affiliation agreement. This 

would effectively allow existing 

teaching hospitals to achieve an 

increase in their FTE resident caps 

beyond the number allowed by their 

statutory caps. 

In contrast, hospitals in rural areas 

that qualify for an adjustment under 

§ 413.79(e)(1)(v) are allowed to enter 

into a Medicare GME affiliation. 

Although we recognize that rural 

hospitals would not be immune from 

the kind of ‘‘gaming’’ arrangement 

described above, we allow new rural 

teaching hospitals that begin training 

residents in new programs, and thereby 

increase their FTE cap, to affiliate 

because we understand that rural 

hospitals may not have a sufficient 

volume of patient care utilization at the 

rural hospital site to be able to support 

a training program that meets 

accreditation standards. Securing 

sufficient patient volumes to meet 

accreditation requirements may 

necessitate rotations of the residents to 

another hospital. Accordingly, the 

regulations allow new teaching 

hospitals in rural areas to enter into 

Medicare GME affiliation agreements. 

However, an affiliation is only 

permitted if the rural hospital provides 

training for at least one-third of the FTE 

residents participating in all of the joint 

programs of the affiliated hospitals 

because, as we stated in the May 12, 

1998 Federal Register (63 FR 26333), we 

believe that requiring at least one-third 

of the training to take place in the rural 

area allows operation of programs that 

focus on, but are not exclusively limited 

to, training in rural areas. 

Through comment and feedback from 

industry trade groups and hospitals, we 

understand that, while these rules were 

meant to prevent gaming on the part of 

existing teaching hospitals, they could 

also preclude affiliations that clearly are 

designed to facilitate additional training 

at the new teaching hospital. 

For example, Hospital A had no 

allopathic or osteopathic residents in its 

most recent cost reporting period ending 

on or before December 31, 1996. As 

such, Hospital A’s caps for direct GME 

and IME are both zero. Hospital A and 

Hospital B enter into a Medicare GME 

affiliation for the academic year 

beginning on July 1, 2003, and ending 

on June 30, 2004. On July 1, 2003, 

Hospital A begins training residents 

from an existing family medicine 

program located at Hospital B. This 

rotation will result in 5 FTE residents 

training at Hospital A. Through the 

affiliation agreement, Hospital A 

receives a positive adjustment of 5 

FTE’s for both its direct GME and IME 

caps. Hospital B receives a 

corresponding negative adjustment of 5 

FTEs under the affiliation agreement. 

Hospital A’s Board of Directors is 

interested in starting a new residency 

program in Internal Medicine that 

would begin training residents at 

Hospital A on July 1, 2005. If Hospital 

A establishes the new program, under 

existing Medicare regulations, Hospital 

A will have its direct GME and IME 

caps (which were both previously 

established at zero) permanently 

adjusted to reflect the additional 

residents training in the newly 

approved program in accordance with 

§ 413.79(e)(1). However, under existing 

regulations, Hospital A may no longer 

enter into an affiliation with Hospital B 

after it receives the adjustment to its 

FTE caps under § 413.79(e)(1). 

We are proposing to revise 

§ 413.79(e)(1)(iv) so that new urban 

teaching hospitals that qualify for an 

adjustment under § 413.79(e)(1) may 

enter into a Medicare GME affiliation 

agreement under certain circumstances. 

Specifically, a new urban teaching 

hospital that qualifies for an adjustment 

to its FTE caps for a newly approved 

program may enter into a Medicare GME 

affiliation agreement, but only if the 

resulting adjustments to its direct GME 

and IME caps are ‘‘positive 

adjustments.’’ ‘‘Positive adjustment’’

means, for the purpose of this policy, 

that there is an increase in the new 

teaching hospital’s caps as a result of 

the affiliation agreement. At no time 

would the caps of a hospital located in 

an urban area that qualifies for 

adjustment to its FTE caps for a new 

program under § 413.79(e)(1), be 

allowed to decrease as a result of a 

Medicare GME affiliation agreement. We 

believe this proposed policy change 

would allow new urban teaching 

hospitals flexibility to start new 

teaching programs without jeopardizing 

their ability to count additional FTE 

residents training at the hospital under 

an affiliation agreement. 

We remain concerned that hospitals 

with existing medical residency training 

programs could cooperate with a new 

teaching hospital to circumvent the 

statutory FTE caps by establishing new 

programs at the new teaching hospital, 

and, through a Medicare GME affiliation 

agreement, moving most or all of the 

new residency program to its own 

hospital, thereby receiving an upward 

adjustment to its FTE caps. For this 

reason, we are proposing to revise 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23441 

§ 413.79(e)(1)(iv) of the regulations to 

provide that a hospital that qualifies for 

an adjustment to its caps under 

§ 413.79(e)(1) would not be permitted to 

enter into an affiliation agreement that 

would produce a negative adjustment to 

its FTE resident cap. 

Continuing the example shown above, 

under the proposed change in policy, 

Hospital A and Hospital B would be 

able to continue the Medicare GME 

affiliation agreement under which 

Hospital A trained residents from 

Hospital B’s family practice program 

because Hospital A would receive an 

increase in its direct GME or IME caps 

under an affiliation after qualifying for 

a new program adjustment under 

§ 413.79(e)(1). However, Hospital B 

would not be able to receive an increase 

in its caps as a result of a Medicare GME 

affiliation agreement with Hospital A. 

Thus, we are proposing the above 

policy change to provide some 

flexibility to hospitals that are currently 

prohibited from entering into a 

Medicare GME affiliation agreement, 

while continuing to protect the statutory 

FTE resident caps from being 

undermined by gaming. We solicit 

comments on the proposed change. 

4. GME FTE Cap Adjustment for Rural 

Hospitals (§ 413.79(c) and (k)) 

As stated earlier under section V.I.1. 

of this preamble, Medicare makes both 

direct and indirect GME payments to 

hospitals for the training of residents. 

Direct GME payments are made in 

accordance with section 1886(h) of the 

Act, based generally on the hospitalspecific PRA, the number of FTE 

residents a hospital trains, and the 

hospital’s percentage of Medicare 

inpatient utilization. Indirect GME 

payments (referred to as IME) are made 

in accordance with section 1886(d)(5)(B) 

of the Act as an adjustment to DRG 

payment and are based generally on the 

ratio of the hospital’s FTE residents to 

the number of hospital beds. It is wellestablished that the calculation of both 

direct GME and IME payments is 

affected by the number of FTE residents 

a hospital is allowed to count; generally, 

the greater the number of FTE residents 

a hospital counts, the greater the 

amount of Medicare direct GME and 

IME payments the hospital will receive. 

Effective October 1, 1997, Congress 

instituted caps on the number of 

allopathic and osteopathic residents a 

hospital is allowed to count for direct 

GME and IME purposes at sections 

1886(h)(4)(F) (direct GME) and 

1886(d)(5)(B)(v) (IME) of the Act. These 

caps were instituted in an attempt to 

end the implicit incentive for hospitals 

to increase the number of FTE residents. 

Dental and podiatric residents were not 

included in these statutorily mandated 

caps. 

Congress provided certain exceptions 

for rural hospitals when establishing the 

1996 caps ‘‘with the intent of 

encouraging physician training and 

practice in rural areas’’ (65 FR 47032). 

For example, the statute states at section 

1886(h)(4)(H)(i) that, in promulgating 

rules regarding application of the FTE 

caps to training programs established 

after January 1, 1995, ‘‘the Secretary 

shall give special consideration to 

facilities that meet the needs of 

underserved rural areas.’’ Accordingly, 

in implementing this provision, we 

provided in the regulations under 

§ 413.86(g)(6)(i)(C) (now 

§ 413.79(e)(1)(iii)) that ‘‘except for rural 

hospitals, the cap will not be adjusted 

for new programs established more than 

3 years after the first program begins 

training residents. In other words, only 

hospitals located in rural areas (that is, 

areas that are not designated as an 

MSA), receive adjustments to their 

unweighted FTE caps to reflect 

residents in new medical residency 

training programs past the third year 

after the first residency program began 

training in that hospital (62 FR 46006). 

Section 413.79(e)(1) specifies the new 

program adjustment as the ‘‘product of 

the highest number of residents in any 

program year during the third year of 

the * * * program’s existence * * * 

and the number of years in which 

residents are expected to complete the 

program based on the minimum 

accredited length for the type of 

program.’’ The regulation applies only 

to new programs (as defined under 

§ 413.79(1)) established by rural 

hospitals, not for expansion of 

previously existing programs. For 

example, if a rural hospital has an 

unweighted FTE cap for direct GME of 

100 and begins training residents in a 

new 3-year residency program that has 

10 residents in each of its first 3 

program years (for a total of 30 residents 

in the entire program in the program’s 

third year), the hospital’s direct GME 

FTE cap of 100 would be permanently 

adjusted at the conclusion of the third 

program year by 30, and the hospital’s 

new FTE cap would be 130. A similar 

adjustment would be made to the 

hospital’s FTE cap for IME in 

accordance with the regulations at 

§ 412.105(f)(1)(iv)(A). However, the 

rural hospital would not be able to 

receive adjustments to its FTE cap for 

any expansion of a preexisting program. 

In 1999, Congress passed an 

additional provision under section 407 

of Pub. L. 106–113 (BBRA) to promote 

physician training in rural areas. 

Section 407 of the Pub. L. 106–113 

amended the FTE caps provision at 

sections 1886(h)(4)(F) and 

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

that ‘‘effective for cost reporting periods 

beginning on or after April 1, 2000, [a 

rural hospital’s FTE cap] is 130 percent 

of the unweighted FTE count * * * for 

those residents for the most recent cost 

reporting period ending on or before 

December 31, 1996.’’ In other words, the 

otherwise applicable FTE caps for rural 

hospitals were multiplied by 1.3 to 

encourage rural hospitals to expand 

preexisting residency programs. (As 

described above, even prior to the BBRA 

change, rural hospitals were able to 

receive FTE cap adjustments for new 

programs.) For example, a hospital that 

was rural as of April 1, 2000, and had 

a direct GME cap of 100 FTEs would 

receive a permanent cap adjustment of 

30 FTEs (100 FTEs × 1.3 = 130 FTEs) 

and effective for cost reporting periods 

beginning on or after April 1, 2000, its 

FTE for direct GME would be 130. (A 

similar adjustment would be made to 

the FTE cap for IME for discharges 

occurring on or after April 1, 2000.) 

We recently received questions 

regarding the application of the 130- 

percent FTE cap adjustment and the 

new program adjustment for rural 

hospitals in instances in which a rural 

teaching hospital is later redesignated as 

an urban hospital or reclassifies back to 

being an urban hospital after having 

been classified as rural. We are aware of 

two circumstances when a rural hospital 

may subsequently be reclassified as 

urban. The first circumstance involves 

labor market area changes, and the 

second involves urban hospitals, after 

having been reclassified as rural through 

section 1886(d)(8)(E) of the Act, that 

elect to be considered urban again. In 

both situations, if the hospital in 

question was a teaching hospital, its 

FTE caps would have been subject to 

the 130 percent and new program FTE 

cap adjustments while it was designated 

or classified as rural. The issue is 

whether the adjusted caps would 

continue to apply after the hospital 

becomes urban or returns to being 

treated as urban. Below we first address 

hospitals that lost their status as urban 

hospitals due to new labor market areas. 

We then address hospitals that 

rescinded their section 1886(d)(8)(E) 

reclassifications. (We note that 

reclassification by the MGCRB under 

section 1886(d)(10) of the Act, as well 

as reclassifications under section 

1886(d)(8)(B) of the Act, are effective 

only for purposes of the wage index and 

would not affect the hospital’s IME or 

direct GME payments). 

23442 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

a. Formerly Rural Hospitals That 

Became Urban Due to the New CBSA 

Labor Market Areas 

In the FY 2005 IPPS final rule, we 

adopted the new CBSA-based labor 

market areas announced by OMB on 

June 6, 2003, and these areas became 

effective October 1, 2004. As a result of 

these new labor market areas, a number 

of hospitals that previously were located 

outside of an MSA and therefore 

considered rural are now located in a 

CBSA that is designated as urban and 

considered urban. 

We believe that previously rural 

hospitals that received adjustments due 

to establishing new medical training 

programs should not now be required to 

forego such adjustments simply because 

they have now been redesignated as 

urban. Such hospitals added and 

received accreditation for new medical 

training programs under the assumption 

that such programs would effect a 

permanent increase in their FTE caps. 

Indeed, we believe it would be 

nonsensical to view the fact that these 

hospitals are now urban as causing them 

to lose the adjustments that stemmed 

directly from the permissible and 

encouraged establishment of new 

medical training programs. Such 

hospitals cannot reach back into the 

past and alter whether they added the 

new programs or not. Nor would it be 

reasonable to prohibit them from 

counting FTE residents training in new 

programs that they worked to accredit. 

(We note that the hospitals would not be 

required to close the programs. Rather, 

if they were not permitted to retain the 

adjustments to their FTE caps they 

received as a result of having 

established new programs, they would 

no longer be permitted to count FTE 

residents that exceeded their original, 

preadjustment FTE caps for purposes of 

direct GME and IME payments. The 

effect might be that the hospital would 

have to close the program(s) as a result 

of decreased Medicare funding, but the 

hospital would be free to continue to 

operate the programs(s).) 

For these reasons, we believe the best 

reading of our regulation at 

§ 413.79(e)(3), which states that if a 

hospital ‘‘is located in a rural area,’’ it 

may adjust its FTE cap to reflect 

residents training in new programs, is 

that hospitals were permitted to receive 

a permanent adjustment to their FTE 

caps if, at the time of adding a new 

program, the hospitals were rural. A 

hospital’s subsequent designation as 

urban or rural due to labor market area 

changes becomes irrelevant, because the 

central question is whether the hospital 

is rural at the time it adds the new 

programs. Therefore, we are clarifying 

in this proposed rule our policy that 

hospitals that became urban in FY 2005 

due to the new labor market areas 

would nevertheless be permitted to 

retain the adjustments they received for 

new programs as long as they were rural 

at the time they received them. (Once 

such hospitals receive a designation as 

‘‘urban,’’ they may no longer seek FTE 

cap adjustments relating to new training 

programs; they may only retain the 

adjustments they received for the new 

programs they added when they were 

rural.) 

Similarly, we believe that rural 

hospitals that received the statutorily 

mandated 130 percent adjustment to 

their FTE caps would be disadvantaged 

if we were to rescind this adjustment 

due to new urban designation. Such 

hospitals expanded their already 

existing training programs under the 

assumption that these expansions 

would cause a permanent increase in 

their FTE caps. Many of these hospitals 

expanded their programs only once the 

BBRA became effective (in 2000). Thus, 

they have had only a few years to 

expand their programs and receive the 

cap adjustment mandated by statute. For 

these reasons, we believe it is 

permissible to read sections 

1886(h)(4)(F)(i) and 1886(d)(5)(B)(v) of 

the Act as permitting a permanent 

adjustment to the FTE caps at the time 

a rural hospital adds residents to its 

already existing program(s). The 

language states that the total number of 

FTE residents with respect to a 

‘‘hospital’s approved medical residency 

training program in the fields of 

allopathic medicine and osteopathic 

medicine may not exceed the number 

(or, 130 percent of such number in the 

case of a hospital located in a rural area) 

of such full-time equivalent residents 

for the hospital’s most recent cost 

reporting period ending on or before 

December 31, 1996.’’ As with the 

addition of new programs, we interpret 

the language ‘‘130 percent of such 

number in the case of a hospital located 

in a rural area,’’ as meaning only that 

the hospital was required to be rural at 

the time it received the 30-percent 

increase. Once the hospital received 

such increase, the increase became a 

permanent increase in the FTE cap and 

should not be rescinded based on 

subsequent designation as an urban 

hospital. 

We believe our interpretations are 

consistent with legislative intent. 

Congress provided for these FTE cap 

adjustments for rural hospitals with the 

intent of encouraging physician training 

and practice in rural areas. If rural 

hospitals had believed that new CBSAs 

would cause them to lose the 

adjustments, they would not have had 

the incentives Congress wished to 

increase the number of FTE residents 

training in their programs. These 

hospitals might have feared losing the 

adjustments as a result of new labor 

market areas, and therefore not carried 

out Congress’ intent to expand their 

already existing residency training 

programs or add new residency training 

programs. 

To provide an example of the how the 

above statutory interpretations would be 

applied, a hospital located in a rural 

area prior to October 1, 2004, with an 

unweighted direct GME FTE cap of 100 

would have received a 30-percent 

increase in its FTE cap so that its 

adjusted cap was 130 FTEs. The rural 

hospital also could have received an 

adjustment for any new medical 

residency program. If this hospital, 

while rural, started a new 3-year 

residency program with 10 residents in 

each program year, its FTE cap would 

have been increased by an additional 30 

FTEs to 160 FTEs (that is, (100 FTEs × 

1.3) + 30 FTEs = 160 FTEs). Under our 

reading of the statute, if this hospital is 

now located in an urban area due to the 

new CBSAs, it would retain this cap of 

160 FTEs. 

We also believe that the statute 

should be interpreted as permitting 

urban hospitals with rural track training 

programs to retain the adjustment they 

received for such programs at 

§ 413.79(k), even if the ‘‘rural’’ tracks as 

of October 1, 2004, are now located in 

urban areas due to the new OMB labor 

market areas. As explained in the FY 

2001 IPPS final rule (66 FR 47033), we 

provided that an urban hospital that 

establishes a separately accredited 

medical residency training program in a 

rural area (that is, a rural track) may 

receive an adjustment to reflect the 

number of residents in that program 

(existing § 413.79(k)). Section 

1886(h)(4)(H)(iv) of the Act states: ‘‘In 

the case of a hospital that is not located 

in a rural area but establishes separately 

accredited approved medical residency 

training programs (or rural tracks) in an 

(sic) rural area or has an accredited 

training program with an integrated 

rural track, the Secretary shall adjust the 

limitation under subparagraph (F) in an 

appropriate manner insofar as it applies 

to such programs in such rural areas in 

order to encourage the training of 

physicians in rural areas.’’

Again, we believe that the reading 

that best carries out Congressional 

intent is one that allows the adjustment 

for rural tracks to remain permanent as 

long as the rural track training programs 

continue, even if the once-rural tracks 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23443 

are now urban due to new labor market 

area boundaries. Congress clearly 

intended to encourage the training of 

physicians in the rural tracks identified 

by the statute. However, if the FTE cap 

adjustments were merely temporary, 

and hospitals could not rely on 

retaining the adjustments relating to the 

rural training programs in which they 

invested, then Congress’ wishes to 

encourage rural training programs might 

not have been realized. Hospitals would 

always need to speculate as to whether 

the FTE cap adjustments relating to the 

rural track programs they established 

would be lost each time new labor 

market areas were adopted (which 

normally occurs once every 10 years). 

Thus, we believe the statutory language 

should be interpreted as allowing an 

urban hospital to retain its FTE cap 

adjustment for rural track programs as 

long as the tracks were actually located 

in rural areas at the time the urban 

hospital received its adjustment. 

However, if the urban hospital wants to 

receive a cap adjustment for a new rural 

track residency program, the rural track 

must involve rural hospitals that are 

located in rural areas based on the most 

recent OMB labor market designations 

as specified in the FY 2005 IPPS final 

rule. We are proposing to add a new 

paragraph (k)(7) to § 413.79 to 

incorporate this proposal. 

b. Section 1886(d)(8)(E) Hospitals 

As stated above, a second situation 

exists where a hospital that is treated as 

rural returns to being urban under 

section 1886(d)(8)(E) of the Act 

(§ 412.103 of the regulations). Under 

this provision, an urban hospital may 

file an application to be treated as being 

located in a rural area. A hospital’s 

reclassification as located in a rural area 

under this provision affects only 

payments under section 1886(d) of the 

Act. Accordingly, a hospital that is 

treated as rural under this provision can 

receive the FTE cap adjustments that 

any other rural hospital receives, but 

only to the FTE cap that applies for 

purposes of IME payments, which are 

made under section 1886(d) of the Act. 

The hospital could not receive 

adjustments to its direct GME FTE cap 

because payments for direct GME are 

made under section 1886(h) of the Act 

and the section 1886(d)(8)(E) 

reclassifications affect only the 

payments that are made under that 

section 1886(d) of the Act. Therefore, a 

hospital that reclassifies as rural under 

section 1886(d)(8)(E) of the Act may 

receive the 130-percent adjustment to its 

IME FTE cap and its IME FTE cap may 

be adjusted for any new programs, 

similar to hospitals that are actually 

located in a rural location. A hospital 

treated as rural under section 

1886(d)(8)(E) of the Act may 

subsequently withdraw its election and 

return to its urban status under the 

regulations at § 412.103. We are 

proposing that, effective with discharges 

occurring on or after October 1, 2005, a 

different policy should apply for 

hospitals that reclassify under section 

1886(d)(8)(E) of the Act than the policy 

that applies to rural hospitals 

redesignated as urban due to changes in 

labor market areas, as discussed in 

section IV.F.3 of this preamble. 

5. Technical Changes: Cross References 

• In the FY 2005 IPPS final rule (69 

FR 49234), we redesignated the contents 

of § 413.86 as §§ 413.75 through 413.83. 

We also updated cross-references to 

§ 413.86 that were located in various 

sections under 42 CFR Parts 400 

through 499. We inadvertently did not 

capture all of the needed cross-reference 

changes. In this proposed rule, we are 

proposing to correct the additional 

cross-references in 42 CFR Parts 405, 

412, 413, 415, 419, and 422 that were 

not made in the August 11, 2004 final 

rule. 

• When we redesignated § 413.86 as 

§§ 413.75 through 413.83 in the FY 2005 

IPPS final rule, we also made a 

corresponding redesignation of § 413.80 

as § 413.89. We are proposing to correct 

cross-references to § 413.80 in 42 CFR 

Parts 412, 413, 417, and 419 to reflect 

the redesignation of this section as 

§ 413.89. 

J. Provider-Based Status of Facilities 

and Organizations Under Medicare 

(If you choose to comment on issues 

in this section, please include the 

caption ‘‘Provider-Based Entities’’ at the 

beginning of your comment.) 

1. Background 

Since the beginning of the Medicare 

program, some providers, which we 

refer to as ‘‘main providers,’’ have 

functioned as a single entity while 

owning and operating multiple 

provider-based departments, locations, 

and facilities that were treated as part of 

the main provider for Medicare 

purposes. Having clear criteria for 

provider-based status is important 

because this designation can result in 

additional Medicare payments for 

services furnished at the provider-based 

facility, and may also increase the 

coinsurance liability of Medicare 

beneficiaries for those services. 

To set forth Medicare policies with 

regard to the provider-based status of 

facilities and organizations, we have 

published a number of Federal Register 

documents as follows: 

• In a proposed rule published in the 

Federal Register on September 8, 1998 

(63 FR 47552), we proposed specific and 

comprehensive criteria for determining 

whether a facility or organization is 

provider-based. In the preamble to the 

proposed rule, we explained why we 

believed meeting each criterion would 

be necessary to a finding that a facility 

or organization qualifies for providerbased status. After considering public 

comments on the September 8, 1998 

proposed rule and making appropriate 

revisions, on April 7, 2000 (65 FR 

18504), we published a final rule setting 

forth the provider-based regulations at 

42 CFR 413.65. 

• Before the regulations that were 

issued on April 7, 2000 could be 

implemented, Congress enacted the 

Medicare, Medicaid, and SCHIP 

Benefits Improvement and Protection 

Act of 2000 (BIPA), Pub. L. 106–544. 

Section 404 of BIPA delayed 

implementation of the April 7, 2000 

provider-based rules with respect to 

many providers, and mandated changes 

in the criteria at § 413.65 for 

determining provider-based status. 

• In order to conform our regulations 

to the requirements of section 404 of 

BIPA and to codify certain clarifications 

of provider-based policy that had 

previously been posted on the CMS Web 

site, we published another proposed 

rule on August 24, 2001 (66 FR 44672). 

After considering public comments on 

the August 24, 2001 proposed rule and 

making appropriate revisions, we 

published a final rule on November 30, 

2001 setting forth the provider-based 

regulations (66 FR 59909). 

• On May 9, 2002, we proposed 

further significant revisions to the 

provider-based regulations at § 413.65 

(67 FR 31480). After considering public 

comments on the May 9, 2002 proposed 

rule and making appropriate revisions, 

on August 1, 2002, we published a final 

rule specifying the criteria that must be 

met to qualify for provider-based status 

(67 FR 50078). These regulations remain 

in effect and continue to be codified at 

§ 413.65. 

Following is a discussion of the major 

provisions of the provider-based 

regulations: Section 413.65(a) of the 

regulations describes the scope of that 

section and provides definitions of key 

terms used in the regulations. Paragraph 

(b) describes the procedure for making 

provider-based determinations, and 

paragraph (c) imposes requirements for 

reporting material changes in 

relationships between main providers 

and provider-based facilities or 

organizations. In paragraph (d), we 

23444 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

specify the requirements that are 

applicable to all facilities or 

organizations seeking provider-based 

status, and in paragraph (e), we describe 

the additional requirements applicable 

to off-campus facilities or organizations 

(generally, those located more than 250 

yards from the provider’s main 

buildings). Paragraphs (f) through (o) set 

forth policies regarding joint ventures, 

obligations of provider-based facilities, 

facilities operated under management 

contracts or providing all services under 

arrangements, procedures in connection 

with certain provider-based 

determinations, and specific types of 

facilities such as Indian Health Service 

(IHS) and Tribal facilities and Federally 

qualified health centers (FQHCs). 

2. Limits on the Scope of the ProviderBased Regulations—Facilities for Which 

Provider-Based Determinations Will Not 

Be Made 

In § 413.65(a) (1)(ii), we list specific 

types of facilities and organizations for 

which determinations of provider-based 

status will not be made. We previously 

concluded that provider-based 

determinations should not be made for 

these facilities because the outcome of 

the determination (that is, whether a 

facility, unit, or department is found to 

be freestanding or provider-based) 

would not affect the methodology used 

to make Medicare or Medicaid payment, 

the scope of benefits available to a 

Medicare beneficiary in or at the 

facility, or the deductible or coinsurance 

liability of a Medicare beneficiary in or 

at the facility. 

We have now concluded that, under 

the principle stated above, rural health 

clinics affiliated with hospitals having 

50 or more beds should be added to the 

list of facilities for which providerbased status determinations are not 

made. Therefore, we are proposing to 

revise § 413.65(a)(1)(ii) to add rural 

health clinics with hospitals having 50 

or more beds to the listing of the types 

of facilities for which a provider-based 

status determination will not be made. 

We believe this proposed revision to 

§ 413.65(a)(1)(ii) is appropriate because 

all rural health clinics affiliated with 

hospitals having 50 or more beds are 

paid on the same basis as rural health 

clinics not affiliated with any hospital, 

and the scope of Medicare Part B 

benefits and beneficiary liability for 

Medicare Part B deductible and 

coinsurance amounts would be the 

same, regardless of whether the rural 

health clinic was found to be providerbased or freestanding. 

In setting forth this proposal, we 

recognize that rural health clinics 

affiliated with hospitals report their 

costs using the hospital’s cost report 

rather than by filing a separate rural 

health clinic cost report, and that 

whether or not a rural health clinic is 

hospital-affiliated will affect the 

selection of a fiscal intermediary for the 

clinic. However, we do not believe these 

administrative differences provide a 

sufficient reason to make provider-based 

determinations for such rural health 

clinics. 

3. Location Requirement for Off-Campus 

Facilities: Application to Certain 

Neonatal Intensive Care Units 

As we stated in the preamble to May 

9, 2002 proposed rule for changes in the 

provider-based rules (67 FR 31485), we 

recognize that provider-based status is 

not limited to on-campus facilities or 

organizations and that facilities or 

organizations located off the main 

provider campus may also be 

sufficiently integrated with the main 

provider to justify a provider-based 

designation. However, the off-campus 

location of the facilities or organizations 

may make such integration harder to 

achieve, and such integration should 

not simply be presumed to exist. 

Therefore, to ensure that off-campus 

facilities or organizations seeking 

provider-based status are appropriately 

integrated, we have adopted certain 

requirements regarding the location of 

off-campus facilities or organizations. 

These requirements are set forth in 

§ 413.65(e)(3). Section 413.65(e)(3) 

specifies that a facility or organization 

not located on the main campus of the 

potential main provider can qualify for 

provider-based status only if it is 

located within a 35-mile radius of the 

campus of the hospital or CAH that is 

the potential main provider, or meets 

any one of the following requirements. 

• The facility or organization is 

owned and operated by a hospital or 

CAH that has a disproportionate share 

adjustment (as determined under 

§ 412.106) greater than 11.75 percent or 

is described in § 412.106(c)(2) of the 

regulations which implement section 

1886(e)(5)(F)(i)(II) of the Act and is—

—Owned or operated by a unit of State 

or local government; 

—A public or nonprofit corporation that 

is formally granted governmental 

powers by a unit of State or local 

government; or 

—A private hospital that has a contract 

with a State or local government that 

includes the operation of clinics 

located off the main campus of the 

hospital to assure access in a welldefined service area to health care 

services for low-income individuals 

who are not entitled to benefits under 

Medicare (or medical assistance under 

a Medicaid State plan). 

(§ 413.65(e)(3)(i)) 

• The facility or organization 

demonstrates a high level of integration 

with the main provider by showing that 

it meets all of the other provider-based 

criteria and demonstrates that it serves 

the same patient population as the main 

provider, by submitting records showing 

that, during the 12-month period 

immediately preceding the first day of 

the month in which the application for 

provider-based status is filed with CMS, 

and for each subsequent 12-month 

period—

—At least 75 percent of the patients 

served by the facility or organization 

reside in the same zip code areas as 

at least 75 percent of the patients 

served by the main provider 

(§ 413.65(e)(3)(ii)(A)); or 

—At least 75 percent of the patients 

served by the facility or organization 

who required the type of care 

furnished by the main provider 

received that care from that provider 

(for example, at least 75 percent of the 

patients of a rural health clinic 

seeking provider-based status 

received inpatient hospital services 

from the hospital that is the main 

provider (§ 413.65(e)(3)(ii)(B)). 

Section 413.65(e)(3)(ii)(C) of the 

regulations allows new facilities or 

organizations to qualify as providerbased entities. Under this section, if a 

facility or organization is unable to meet 

the criteria in § 413.65(e)(3)(ii)(A) or 

(e)(3)(ii)(B) because it was not in 

operation during all of the 12-month 

period before the start of the period for 

which provider-based status is sought, 

the facility or organization may 

nevertheless meet the location 

requirement of paragraph (e)(3) of 

§ 413.65 if it is located in a zip code area 

included among those that, during all of 

the 12-month period before the start of 

the period for which provider-based 

status is sought, accounted for at least 

75 percent of the patients served by the 

main provider. 

CMS has been advised that, in some 

cases, the location requirements in 

current regulations may inadvertently 

impede the delivery of intensive care 

services to newborn infants in areas 

where there is no nearby children’s 

hospital with a neonatal intensive care 

unit (NICU). According to those who 

expressed this concern, hospitals 

participating in the Medicare program 

as children’s hospitals establish off-site 

neonatal intensive care units (NICUs) 

which they operate and staff but which 

are located in space leased from other 

hospitals. The hospitals in which the 

offsite NICUs are housed typically are 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23445 

short-term, acute care hospitals located 

in rural areas. According to comments 

that CMS has received, the nearest 

children’s hospital in a rural area is 

usually located a considerable distance 

from individual rural communities, 

which prevents infants in these rural 

communities from having ready access 

to the specialized care offered by NICUs. 

We have received a suggestion that 

this configuration (that of a hospital 

participating in the Medicare program 

as a hospital whose inpatients are 

predominantly individuals under 18 

years of age under section 

1886(d)(1)(B)(iii) of the Act, establishing 

an offsite NICU which it operates and 

staffs but which is located in space 

leased from another hospital) can be 

very helpful in making neonatal 

intensive care more quickly available in 

areas where community hospitals are 

located. In addition, this configuration 

can offer relief to families who 

otherwise would be required to travel 

long distances to obtain this care for 

their infants. However, offsite NICUs 

would not be able to qualify for 

provider-based status under the location 

criteria in our current regulations if they 

are located more than 35 miles from the 

children’s hospital that would be the 

main provider, are not owned and 

operated by a hospital meeting the 

requirements of § 413.65(e)(3)(i), and 

cannot meet either of the ‘‘75 percent 

tests’’ for service to the same patient 

population as the potential main 

provider that are specified in existing 

§ 413.65(e)(3)(ii)(A) and 

§ 413.65(e)(3)(ii)(B). 

We understand the concern that 

requiring a patient to be transported to 

an NICU located on the campus of a 

distant children’s hospital could create 

an unacceptable medical risk to the life 

of a newborn at a most critical time. To 

help us better understand this issue and 

determine what action, if any, CMS 

should take on it, we are soliciting 

specific public comment on the 

following question: 

• Is the problem as described above 

actually occurring and, if so, in what 

locations? We are particularly interested 

in learning which areas of which States 

are experiencing such a problem, and in 

receiving specific information, such as 

the rates of transfer of newborns from 

community hospitals to children’s 

hospital on-campus NICUs relative to 

adult or non-neonatal pediatric transfers 

for intensive care services, which 

describe the problem objectively. Such 

objective information will be much 

more useful than expressions of opinion 

or anecdotes. 

We also wish to ask those who believe 

such a problem is currently occurring to 

comment on which of the following 

approaches would be most effective in 

resolving it. The proposed approaches 

on which we are soliciting specific 

comments are: 

■ A change in the Medicare providerbased regulations to create an exception 

to the location requirements for NICUs 

located in community hospitals that are 

more than 35 miles from the children’s 

hospital that is the potential main 

provider. The exception might take the 

form of a more generous mileage 

allowance (such as being within 50 

miles of the potential main provider) or 

could require other criteria to be met. 

However, the exception would be 

available only if there is no other NICU 

within 35 miles of the community 

hospital. 

■ A change in the national Medicaid 

regulations to allow off-campus NICUs 

that meet other provider-based 

requirements under § 413.65 to qualify 

as provider-based for purposes of 

payment under Medicaid, even though 

those facilities would not qualify as 

provider-based under Medicare. (We 

note that under 42 CFR 440.10(a)(3)(iii), 

services are considered to be ‘‘inpatient 

hospital services’’ under the Medicaid 

program only if they are furnished in an 

institution that meets the requirements 

for participation in Medicare as a 

hospital. Because of the age of the 

patients they serve, NICUs typically 

have no Medicare utilization but a 

substantial proportion of their patients 

may be Medicaid patients.) 

■ A change in individual State’s 

Medicaid plans that would provide 

enhanced financial incentives for 

community hospitals to establish 

NICUs, possibly in collaboration with 

children’s hospitals. 

■ The establishment of children’s 

hospitals that meet the requirements for 

being hospitals-within-hospitals under 

42 CFR 412.22(e). (We note that this 

option, unlike the three above, would 

not require any revision of Medicare or 

Medicaid regulations or individual State 

Medicaid plans). 

We also welcome suggestions for 

specific options other than those listed 

above. 

4. Technical and Clarifying Changes to 

§ 413.65 

a. Definitions. In paragraph (a)(2) of 

§ 413.65, we state that the term 

‘‘Provider-based entity’’ means a 

provider of health care services, or an 

RHC as defined in § 405.2401(b), that is 

either created by, or acquired by, a main 

provider for the purpose of furnishing 

health care services of a different type 

from those of the main provider under 

the name, ownership and administrative 

and financial control of the main 

provider, in accordance with the 

provisions of § 413.65. In recognition of 

the fact that provider-based entities, 

unlike departments of a provider, offer 

a type of services different from those of 

the main provider and participate 

separately in Medicare, we are 

proposing to revise this requirement by 

deleting the word ‘‘name’’ from this 

definition. This change would simplify 

compliance with the provider-based 

criteria since entities that do not now 

operate under the potential main 

provider’s name will not be obligated to 

change their names in order to be 

treated as provider-based. 

b. Provider-based determinations. In 

paragraph (b)(3)(ii) of § 413.65, we state 

that, in the case of a facility not located 

on the campus of the potential main 

provider, the provider seeking a 

determination would be required to 

submit an attestation stating that the 

facility meets the criteria in paragraphs 

(d) and (e) of § 413.65, and if the facility 

is operated as a joint venture or under 

a management contract, the 

requirements of paragraph (f) or 

paragraph (h) of § 413.65, as applicable. 

However, paragraph (f), which sets forth 

rules regarding provider-based status for 

joint ventures, states clearly that a 

facility or organization operated as a 

joint venture may qualify for providerbased status only if it is located on the 

main campus of the potential main 

provider. To avoid any 

misunderstanding regarding the content 

of attestations for off-campus facilities, 

we are proposing to revise paragraph 

(b)(3)(ii) by removing the reference to 

compliance with requirements in 

paragraph (f) for joint ventures. We also 

are proposing to add a sentence to 

paragraph (b)(3)(i), regarding 

attestations for on-campus facilities, to 

state that if the facility is operated as a 

joint venture, the attestation by the 

potential main provider regarding that 

facility would also have to include a 

statement that the provider will comply 

with the requirements of paragraph (f) of 

§ 413.65. 

c. Additional requirements applicable 

to off-campus facilities or 

organizations—Operation under the 

ownership and control of the main 

provider. In paragraph (e)(1)(i), 

regarding 100 percent ownership by the 

main provider of the business enterprise 

that constitutes the facility or 

organization seeking provider-bases 

status, we are proposing to add the word 

‘‘main’’ before the word ‘‘provider’’, to 

clarify that the main provider must own 

and control the facility or organization 

seeking provider-based status. We are 

also proposing, for purposes of 

23446 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

clarifying the requirements in paragraph 

(e)(1), to add the word ‘‘main’’ before the 

word ‘‘provider’’ in paragraphs (e)(1)(ii) 

and (e)(1)(iii). 

d. Additional requirements applicable 

to off-campus facilities or 

organizations—Location. We are 

proposing several clarifying changes to 

this paragraph, as follows: 

Currently, the opening sentence of 

§ 413.65(e)(3) states that a facility or 

organization for which provider-based 

status is sought must be located within 

a 35-mile radius of the campus of the 

hospital or CAH that is the potential 

main provider, except when the 

requirements in paragraph (e)(3)(i), 

(e)(3)(ii), or (e)(3)(iii) of that section are 

met. However, the regulation text that 

follows does not contain a paragraph 

designation as paragraph (e)(3)(iii). We 

are proposing to correct this error by 

redesignating existing paragraph 

(e)(3)(ii)(C) as paragraph (e)(3)(iv). We 

are also proposing to revise this 

sentence to state that the facility or 

organization must meet the 

requirements in paragraph (e)(3)(i), 

(e)(3)(ii), (e)(3)(iii), (e)(3)(iv) or, in the 

case of an RHC, paragraph (e)(3)(v) of 

§ 413.65 and the requirements in 

paragraph (e)(3)(vi) of § 413.65. 

We are proposing to revise the 

opening sentence of § 413.65(e)(3) to 

reflect the changes in the coding of this 

paragraph as described above. 

We are also proposing to redesignate 

paragraph (v) of § 413.65(e)(3) as 

paragraph (e)(3)(vi) and correct a 

drafting error by adding the word ‘‘that’’

before ‘‘has fewer than 50 beds’’. This 

proposed addition is a grammatical 

change that is intended only to clarify 

the size of the hospital with which a 

rural health clinic must have a providerbased relationship in order to qualify 

under the special location requirement 

in that paragraph. 

e. Paragraph (g)—Obligations of 

hospital outpatient departments and 

hospital-based entities. We are 

proposing to revise the first sentence of 

paragraph (g)(7), regarding beneficiary 

notices of coinsurance liability, to 

clarify that notice must be given only if 

the service is one for which the 

beneficiary will incur a coinsurance 

liability for both an outpatient visit to 

the hospital and the physician service. 

This should help to make it clear that 

notice is not required for visits that do 

not result in additional coinsurance 

liability. In addition, we are proposing 

to reorganize the subsequent paragraphs 

of that section for clarity. 

K. Rural Community Hospital 

Demonstration Program 

(If you choose to comment on issues 

in this section, please include the 

caption ‘‘Rural Community Hospital 

Demonstration Program’’ at the 

beginning of your comments.) 

In accordance with the requirements 

of section 410A(a) of Pub. L. 108–173, 

the Secretary has established a 5-year 

demonstration (beginning with selected 

hospitals’ first cost reporting period 

beginning on or after October 1, 2004) 

to test the feasibility and advisability of 

establishing ‘‘rural community 

hospitals’’ for Medicare payment 

purposes for covered inpatient hospital 

services furnished to Medicare 

beneficiaries. A rural community 

hospital, as defined in section 

410A(f)(1), is a hospital that—

• Is located in a rural area (as defined 

in section 1886(d)(2)(D) of the Act) or 

treated as being so located under section 

1886(d)(8)(E) of the Act; 

• Has fewer than 51 beds (excluding 

beds in a distinct part psychiatric or 

rehabilitation unit) as reported in its 

most recent cost report; 

• Provides 24-hour emergency care 

services; and 

• Is not designated or eligible for 

designation as a CAH. 

As we indicated in the FY 2005 IPPS 

final rule (69 FR 49078), in accordance 

with sections 410A(a)(2) and (4) of Pub. 

L. 108–173 and using 2002 data from 

the U.S. Census Bureau, we identified 

10 States with the lowest population 

density from which to select hospitals: 

Alaska, Idaho, Montana, Nebraska, 

Nevada, New Mexico, North Dakota, 

South Dakota, Utah, and Wyoming. 

(Source: U.S. Census Bureau Statistical 

Abstract of the United States: 2003) 

Thirteen rural community hospitals 

located within these States are 

participating in the demonstration. 

Under the demonstration, 

participating hospitals are paid the 

reasonable costs of providing covered 

inpatient hospital services (other than 

services furnished by a psychiatric or 

rehabilitation unit of a hospital that is 

a distinct part), applicable for 

discharges occurring in the first cost 

reporting period beginning on or after 

the October 1, 2004 implementation 

date of the demonstration program. 

Payment will be the lesser amount of 

reasonable cost or a target amount in 

subsequent cost reporting periods. The 

target amount in the second cost 

reporting period is defined as the 

reasonable costs of providing covered 

inpatient hospital services in the first 

cost reporting period, increased by the 

inpatient prospective payment update 

factor (as defined in section 

1886(b)(3)(B) of the Act) for that 

particular cost reporting period. The 

target amount in subsequent cost 

reporting periods is defined as the 

preceding cost reporting period’s target 

amount, increased by the inpatient 

prospective payment update factor (as 

defined in section 1886(b)(3)(B) of the 

Act) for that particular cost reporting 

period. 

Covered inpatient hospital services 

means inpatient hospital services 

(defined in section 1861(b) of the Act) 

and includes extended care services 

furnished under an agreement under 

section 1883 of the Act. 

Section 410A of Pub. L. 108–173 

requires that ‘‘in conducting the 

demonstration program under this 

section, the Secretary shall ensure that 

the aggregate payments made by the 

Secretary do not exceed the amount 

which the Secretary would have paid if 

the demonstration program under this 

section was not implemented.’’

Generally, when CMS implements a 

demonstration on a budget neutral basis, 

the demonstration is budget neutral in 

its own terms; in other words, aggregate 

payments to the participating providers 

do not exceed the amount that would be 

paid to those same providers in the 

absence of the demonstration. This form 

of budget neutrality is viable when, by 

changing payments or aligning 

incentives to improve overall efficiency, 

or both, a demonstration may reduce the 

use of some services or eliminate the 

need for others, resulting in reduced 

expenditures for the demonstration 

participants. These reduced 

expenditures offset increased payments 

elsewhere under the demonstration, 

thus ensuring that the demonstration as 

a whole is budget neutral or yields 

savings. However, the small scale of this 

demonstration, in conjunction with the 

payment methodology, makes it 

extremely unlikely that this 

demonstration could be viable under the 

usual form of budget neutrality. 

Specifically, cost-based payments to 13 

small rural hospitals are likely to 

increase Medicare outlays without 

producing any offsetting reduction in 

Medicare expenditures elsewhere. 

Therefore, a rural community hospital’s 

participation in this demonstration is 

unlikely to yield benefits to the 

participant if budget neutrality were to 

be implemented by reducing other 

payments for these providers. 

In order to achieve budget neutrality 

for this demonstration, we are proposing 

to adjust national inpatient PPS rates by 

an amount sufficient to account for the 

added costs of this demonstration. In 

other words, we apply budget neutrality 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23447 

across the payment system as a whole 

rather than merely across the 

participants of this demonstration. As 

we discussed in the FY 2005 IPPS final 

rule (69 FR 49183), we believe that the 

language of the statutory budget 

neutrality requirements permits the 

agency to implement the budget 

neutrality provision in this manner. For 

FY 2006, using the most recent cost 

report data (that is, data for FY 2003), 

adjusted for increased estimated cost for 

the 13 participating hospitals, we are 

proposing that the estimated adjusted 

amount would be $12,706,334. This 

adjusted amount reflects the estimated 

difference between cost and IPPS 

payment based on data from hospitals’

cost reports. We discuss the proposed 

payment rate adjustment that would be 

required to ensure the budget neutrality 

of the demonstration in section II.A.4. of 

the Addendum to this proposed rule. 

The data collection instrument for the 

demonstration has been approved by 

OMB under the title ‘‘Medicare Waiver 

Demonstration Application,’’ under 

OMB approval number 0938–0880, with 

a current expiration date of July 30, 

2006. 

L. Definition of a Hospital in 

Connection With Specialty Hospitals 

(If you choose to comment on issues 

in this section, please include the 

caption ‘‘Specialty Hospitals’’ at the 

beginning of your comment.) 

Section 1861(e) of the Act provides a 

definition for a ‘‘hospital’’ for purposes 

of participating in the Medicare 

program. In order to be a Medicareparticipating hospital, an institution 

must, among other things, be primarily 

engaged in furnishing services to 

inpatients. This requirement is 

incorporated in our regulations on 

conditions of participation for hospitals 

at 42 CFR 482.1. An institution that 

applies for a Medicare provider 

agreement as a hospital but is unable to 

meet this requirement will have its 

application denied in accordance with 

our authority at 42 CFR 489.12. In 

addition, institutions that have a 

Medicare hospital provider agreement 

but are no longer primarily engaging in 

furnishing services to inpatients are 

subject to having their provider 

agreements terminated pursuant to 42 

CFR 489.53. Although compliance with 

this requirement is not problematic for 

most hospitals, the issue of whether an 

institution is primarily engaged in 

providing care to inpatients has recently 

come to our attention in two arisen two 

contexts. First, an institution has 

applied to be certified as an ‘‘emergency 

hospital,’’ yet the institution has 29 

outpatient beds for emergency patients, 

including observation and postanesthesia care, and only 2 inpatient 

beds. Emergency treatment by nature 

does not usually involve overnight 

stays. Second, the issue has also arisen 

in the area of ‘‘specialty hospitals.’’ (For 

purposes of this discussion, ‘‘specialty 

hospitals’’ are those hospitals 

specifically defined as such in section 

507 of Pub. L. 108–173 (MMA), that is, 

those hospitals that are primarily or 

exclusively engaged in the care and 

treatment of: 

(i) Patients with a cardiac condition; 

(ii) patients with an orthopedic 

condition; or (iii) patients receiving a 

surgical procedure.) 

‘‘Specialty hospitals’’ are of interest 

partly because of section 507 of Pub. L. 

108–173, which amended the hospital 

ownership exception to the physician 

self-referral prohibition statute, section 

1877 of the Act. Prior to the enactment 

of Pub. L. 108–173, the ‘‘whole hospital’’

exception contained in section 

1877(d)(3) of the Act allowed a 

physician to refer Medicare patients to 

a hospital in which the physician (or an 

immediate family member of the 

physician) had an ownership or 

investment interest, if the physician was 

authorized to perform services at the 

hospital and the ownership or 

investment interest was in the entire 

hospital and not a subdivision of the 

hospital. Section 507 of Pub. L. 108–173 

added an additional criterion to the 

whole hospital exception, specifying 

that for the 18-month period beginning 

on December 8, 2003 and ending on 

June 8, 2005, physician ownership and 

investment interests in ‘‘specialty 

hospitals’’ would not qualify for the 

whole hospital exception. The term 

‘‘specialty hospital’’ does not include 

any hospital determined by the 

Secretary to be in operation or ‘‘under 

development’’ as of November 18, 2003. 

In our advisory opinions that we issue 

as to whether a requesting entity is 

subject to the 18-month moratorium 

described above, we inform the 

requesting entity that, among other 

things, it must meet the definition of a 

hospital that is contained in section 

1861(e) of the Act. It has come to our 

attention that some institutions entities 

that describe themselves as surgical or 

orthopedic specialty hospitals may be 

primarily primarily engaged in 

furnishing services to outpatients, and 

thus would might not meet the 

definition of a hospital as contained in 

section 1861(e) of the Act. Therefore, 

although an institution entity may 

satisfy the ‘‘under development’’ criteria 

for purposes of being excepted from the 

moratorium on physician-owner 

referrals to specialty hospitals, if we 

were to determine such entity is not 

primarily engaged in inpatient care at 

the time it seeks certification to 

participate in the Medicare program, its 

application for a provider agreement as 

a hospital would will be denied and it 

would not be eligible for the whole 

hospital exception to the prohibition on 

physician self-referrals. Further, if we 

were to determine that a specialty 

hospital that is operating under an 

existing Medicare provider agreement 

but is not, or is no longer, primarily 

engaged in treating inpatients, the 

hospital is subject to having its provider 

agreement terminated; in this event, it 

could no longer take advantage of and 

lose the protection of the whole hospital 

exception. 

VI. PPS for Capital-Related Costs 

(If you choose to comment on issues 

in this section, please include the 

caption ‘‘Capital-Related Costs’’ at the 

beginning of your comment.) 

In this proposed rule, we are not 

proposing any changes in the policies 

governing the determination of the 

payment rates for capital-related costs 

for short-term acute care hospitals under 

the IPPS. However, for the readers’

benefit, we are providing a summary of 

the statutory basis for the PPS for 

hospital capital-related costs and the 

methodology used to determine capitalrelated payments to hospitals. A 

discussion of the proposed rates and 

factors for FY 2006 (determined under 

our established methodology) can be 

found in section III. of the Addendum 

of this proposed rule. 

Section 1886(g) of the Act requires the 

Secretary to pay for the capital-related 

costs of inpatient acute hospital services 

‘‘in accordance with a PPS established 

by the Secretary.’’ Under the statute, the 

Secretary has broad authority in 

establishing and implementing the PPS 

for hospital inpatient capital-related 

costs. We initially implemented the PPS 

for capital-related costs in the August 

30, 1991 IPPS final rule (56 FR 43358), 

in which we established a 10-year 

transition period to change the payment 

methodology for Medicare hospital 

inpatient capital-related costs from a 

reasonable cost-based methodology to a 

prospective methodology (based fully 

on the Federal rate). 

Federal fiscal year (FY) 2001 was the 

last year of the 10-year transition period 

established to phase in the PPS for 

hospital inpatient capital-related costs. 

For cost reporting periods beginning in 

FY 2002, capital PPS payments are 

based solely on the Federal rate for most 

acute care hospitals (other than certain 

new hospitals and hospitals receiving 

certain exception payments). The basic 

23448 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

methodology for determining capital 

prospective payments using the Federal 

rate is set forth in § 412.312. For the 

purpose of calculating payments for 

each discharge, the standard Federal 

rate is adjusted as follows: 

(Standard Federal Rate) × (DRG 

Weight) × (Geographic Adjustment 

Factor (GAF)) × (Large Urban Add-on, if 

applicable) × (COLA Adjustment for 

hospitals located in Alaska and Hawaii) 

× (1 + Capital DSH Adjustment Factor + 

Capital IME Adjustment Factor, if 

applicable) 

Hospitals also may receive outlier 

payments for those cases that qualify 

under the thresholds established for 

each fiscal year as specified in 

§ 412.312(c) of the regulations. 

The regulations at § 412.348(f) 

provide that a hospital may request an 

additional payment if the hospital 

incurs unanticipated capital 

expenditures in excess of $5 million due 

to extraordinary circumstances beyond 

the hospital’s control. This policy was 

originally established for hospitals 

during the 10-year transition period, but 

as we discussed in the August 1, 2002 

IPPS final rule (67 FR 50102), we 

revised the regulations at § 412.312 to 

specify that payments for extraordinary 

circumstances are also made for cost 

reporting periods after the transition 

period (that is, cost reporting periods 

beginning on or after October 1, 2001). 

Additional information on the 

exceptions payment for extraordinary 

circumstances in § 412.348(f) can be 

found in the FY 2005 IPPS final rule (69 

FR 49185 through 49186). 

During the transition period, under 

§§ 412.348(b) through (e), eligible 

hospitals could receive regular 

exception payments. These exception 

payments guaranteed a hospital a 

minimum payment percentage of its 

Medicare allowable capital-related costs 

depending on the class of hospital 

(§ 412.348(c)), but were available only 

during the 10-year transition period. 

After the end of the transition period, 

eligible hospitals can no longer receive 

this exception payment. However, even 

after the transition period, eligible 

hospitals receive additional payments 

under the special exceptions provisions 

at § 412.348(g), which guarantees all 

eligible hospitals a minimum payment 

of 70 percent of its Medicare allowable 

capital-related costs provided that 

special exceptions payments do not 

exceed 10 percent of total capital IPPS 

payments. Special exceptions payments 

may be made only for the 10 years from 

the cost reporting year in which the 

hospital completes its qualifying 

project, and the hospital must have 

completed the project no later than the 

hospital’s cost reporting period 

beginning before October 1, 2001. Thus, 

an eligible hospital may receive special 

exceptions payments for up to 10 years 

beyond the end of the capital PPS 

transition period. Hospitals eligible for 

special exceptions payments were 

required to submit documentation to the 

intermediary indicating the completion 

date of their project. (For more detailed 

information regarding the special 

exceptions policy under § 412.348(g), 

refer to the August 1, 2001 IPPS final 

rule (66 FR 39911 through 39914) and 

the August 1, 2002 IPPS final rule (67 

FR 50102).) 

Under the PPS for capital-related 

costs, § 412.300(b) of the regulations 

defines a new hospital as a hospital that 

has operated (under current or previous 

ownership) for less than 2 years. (For 

more detailed information see the 

August 30, 1991 final rule (56 FR 

43418).) During the 10-year transition 

period, a new hospital was exempt from 

the capital PPS for its first 2 years of 

operation and was paid 85 percent of its 

reasonable costs during that period. 

Originally, this provision was effective 

only through the transition period and, 

therefore, ended with cost reporting 

periods beginning in FY 2002. Because 

we believe that special protection to 

new hospitals is also appropriate even 

after the transition period, as discussed 

in the August 1, 2002 IPPS final rule (67 

FR 50101), we revised the regulations at 

§ 412.304(c)(2) to provide that, for cost 

reporting periods beginning on or after 

October 1, 2002, a new hospital (defined 

under § 412.300(b)) is paid 85 percent of 

its allowable Medicare inpatient 

hospital capital-related costs through its 

first 2 years of operation, unless the new 

hospital elects to receive fullyprospective payment based on 100 

percent of the Federal rate. (Refer to the 

August 1, 2001 IPPS final rule (66 FR 

39910) for a detailed discussion of the 

statutory basis for the system, the 

development and evolution of the 

system, the methodology used to 

determine capital-related payments to 

hospitals both during and after the 

transition period, and the policy for 

providing exception payments.) 

Section 412.374 provides for the use 

of a blended payment amount for 

prospective payments for capital-related 

costs to hospitals located in Puerto Rico. 

Accordingly, under the capital PPS, we 

compute a separate payment rate 

specific to Puerto Rico hospitals using 

the same methodology used to compute 

the national Federal rate for capitalrelated costs. In general, hospitals 

located in Puerto Rico are paid a blend 

of the applicable capital PPS Puerto 

Rico rate and the applicable capital PPS 

Federal rate. 

Prior to FY 1998, hospitals in Puerto 

Rico were paid a blended capital PPS 

rate that consisted of 75 percent of the 

applicable capital PPS Puerto Rico 

specific rate and 25 percent of the 

applicable capital PPS Federal rate. 

However, effective October 1, 1997 (FY 

1998), in conjunction with the change to 

the operating PPS blend percentage for 

Puerto Rico hospitals required by 

section 4406 of Pub. L. 105–33, we 

revised the methodology for computing 

capital PPS payments to hospitals in 

Puerto Rico to be based on a blend of 

50 percent of the Puerto Rico rate and 

50 percent of the Federal rate. Similarly, 

effective beginning in FY 2005, in 

conjunction with the change in 

operating PPS payments to hospitals in 

Puerto Rico for FY 2005 required by 

section 504 of Pub. L. 108–173, we again 

revised the methodology for computing 

capital PPS payments to hospitals in 

Puerto Rico to be based on a blend of 

25 percent of the Puerto Rico rate and 

75 percent of the Federal rate for 

discharges occurring on or after October 

1, 2004. 

VII. Proposed Changes for Hospitals 

and Hospital Units Excluded From the 

IPPS 

(If you choose to comment on issues 

in this section, please include the 

caption ‘‘Excluded Hospitals and Units’’

at the beginning of your comment.) 

A. Payments to Existing Hospitals and 

Hospital Units (§§ 413.40(c), (d), and (f)) 

1. Payments to Existing Excluded 

Hospitals and Hospital Units 

Section 1886(b)(3)(H) of the Act (as 

amended by section 4414 of Pub. L. 

105–33) established caps on the target 

amounts for cost reporting periods 

beginning on or after October 1, 1997 

through September 30, 2002, for certain 

existing hospitals and hospital units 

excluded from the IPPS. Section 

413.40(c)(4)(iii) of the implementing 

regulations states that ‘‘In the case of a 

psychiatric hospital or unit, 

rehabilitation hospital or unit, or longterm care hospital, the target amount is 

the lower of amounts specified in 

paragraph (c)(4)(iii)(A) or (c)(4)(iii)(B) of 

this section.’’ Accordingly, in general, 

for hospitals and units within these 

three classes of providers for the 

applicable 5-year period, the target 

amount is the lower of either: the 

hospital-specific target amount 

(§ 413.40(c)(4)(iii)(A)) or the 75th 

percentile cap (§ 413.40(c)(4)(iii)(B)). 

(We note that, in the case of LTCHs, for 

cost reporting periods beginning during 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23449 

FY 2001, the hospital-specific target 

amount is the net allowable cost in a 

base period increased by the applicable 

update factors multiplied by 1.25.) 

Questions have been raised as to 

whether § 413.40(c)(4)(iii) (specifically 

paragraph (c)(4)(iii)(A)) continues to 

apply beyond FY 2002. In order to 

clarify the policy for periods after FY 

2002, we note that § 413.40(c)(4)(iii) 

applies only to cost reporting periods 

beginning on or after October 1, 1997 

through September 30, 2002, for 

psychiatric hospitals and units, 

rehabilitation hospitals and units, and 

LTCHs. We discussed this applicable 

time period in the May 12, 1998 Federal 

Register (63 FR 26344) when we 

discussed implementing the caps. 

Specifically, we clarified our regulations 

to indicate that the target amount for 

FYs 1998 through 2002 is equal to the 

lower of the hospital-specific target 

amount or the 75th percentile of target 

amounts for hospitals in the same class 

for cost reporting periods ending during 

FY 1996, increased by the applicable 

market basket percentage for the subject 

period. We did not intend for the 

provisions of § 413.40(c)(4)(iii) to apply 

beyond FY 2002, as we specifically 

included an ending date; that is, we 

stated that the target amount calculation 

provisions were for FYs 1998 through 

2002. More recently, in the FY 2003 

IPPS final rule (67 FR 50103), we 

clarified again how the target amount 

for FY 2003 was to be determined by 

stating that: ‘‘* * * for cost reporting 

periods beginning in FY 2003, the 

hospital or unit should use its previous 

year’s target amount, updated by the 

appropriate rate-of-increase 

percentage.’’ Thus, the time-limited 

provision of § 413.40(c)(4)(iii) is neither 

a new policy nor a change in policy. 

For cost reporting periods beginning 

on or after October 1, 2002, to the extent 

one of the above-mentioned excluded 

hospitals or units has all or a portion of 

its payment determined under 

reasonable cost principles, the target 

amounts for the reasonable cost-based 

portion of the payment are determined 

in accordance with section 

1886(b)(3)(A)(ii) of the Act and the 

regulations at § 413.40(c)(4)(ii). Section 

413.40(c)(4)(ii) states, ‘‘Subject to the 

provisions of [§ 413.40] 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 [§ 413.40] paragraph 

(c)(5)(ii) of this section apply.’’ Thus, 

since § 413.40(c)(4)(ii) indicates that the 

provisions of that paragraph are subject 

to the provisions of § 413.40(c)(4)(iii), 

which are applicable only for cost 

reporting periods beginning on or after 

October 1, 1997 through September 30, 

2002, the target amount for FY 2003 is 

determined by updating the target 

amount for FY 2002 (the target amount 

from the previous period) by the 

applicable update factor. Accordingly, 

we are proposing to make a change to 

the language in § 413.40(c)(4)(iii) to 

clarify that the provisions of this 

paragraph relating to the caps on target 

amounts are for a specific period of time 

only, that is, cost reporting periods 

beginning on or after October 1, 1997, 

and before October 1, 2002. 

The inpatient operating costs of 

children’s hospitals and cancer 

hospitals that are excluded from the 

IPPS are subject to the rate-of-increase 

limits established under the authority of 

section 1886(b) of the Act and 

implemented in the regulations at 

§ 413.40. 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 percentage increase. This 

target amount is applied as a ceiling on 

the allowable costs per discharge for the 

hospital’s cost reporting period. (We 

note that, in accordance with 

§ 403.752(a) of the regulations, RNHCIs 

are also subject to the rate-of-increase 

limits established under § 413.40 of the 

regulations.) 

2. Updated Caps for New Excluded 

Hospitals and Units 

Section 1886(b)(7) of the Act 

established the method for determining 

the payment amount for new 

rehabilitation hospitals and units, 

psychiatric hospitals and units, and 

LTCHs that first received payment as a 

hospital or unit excluded from the IPPS 

on or after October 1, 1997. However, 

effective for cost reporting periods 

beginning on or after October 1, 2002, 

this payment amount (or ‘‘new provider 

cap’’) no longer applies to any new 

rehabilitation hospital or unit because 

they now are paid 100 percent of the 

Federal prospective rate under the IRF 

PPS. 

In addition, LTCHs that meet the 

definition of a new LTCH under 

§ 412.23(e)(4) are also paid 100 percent 

of the fully Federal prospective payment 

rate under the LTCH PPS. In contrast, 

those ‘‘new’’ LTCHs that meet the 

criteria under § 413.40(f)(2)(ii) (that is, 

that were not paid as an excluded 

hospital prior to October 1, 1997), but 

were paid as a LTCH before October 1, 

2002, may be paid under the LTCH PPS 

transition methodology with the 

reasonable cost portion of the payment 

subject to § 413.40(f)(2)(ii). Finally, 

LTCHs that existed prior to October 1, 

1997, may also be paid under the LTCH 

PPS transition methodology with the 

reasonable cost portion of the payment 

subject to § 413.40(c)(4)(ii). (The last 

LTCHs that were subject to the payment 

amount limitation for ‘‘new’’ LTCHs 

were new LTCHs that had their first cost 

reporting period beginning on 

September 30, 2002. In that case, the 

payment amount limitation remained 

applicable for the next 2 years—

September 30, 2002 through September 

29, 2003, and September 30, 2003 

through September 29, 2004. This is 

because, under existing regulations at 

§ 413.40(f)(2)(ii), a ‘‘new hospital’’

would be subject to the same payment 

(target amount) in its second cost 

reporting period that was applicable to 

the LTCH in its first cost reporting 

period. Accordingly, for these hospitals, 

the updated payment amount limitation 

that we published in the FY 2003 IPPS 

final rule (67 FR 50103) applied through 

September 29, 2004. Consequently, 

there is no longer a need to publish 

updated payment amounts for new 

(§ 413.40(f)(2)(ii)) LTCHs. A discussion 

of how the payment limitations were 

calculated can be found in the August 

29, 1997 final rule with comment period 

(62 FR 46019); the May 12, 1998 final 

rule (63 FR 26344); the July 31, 1998 

final rule (63 FR 41000); and the July 30, 

1999 final rule (64 FR 41529). 

A freestanding inpatient rehabilitation 

hospital, an inpatient rehabilitation unit 

of an acute care hospital, and an 

inpatient rehabilitation unit of a CAH 

are referred to as IRFs. Effective for cost 

reporting periods beginning on or after 

October 1, 2002, this payment limitation 

is also no longer applicable to new 

rehabilitation hospitals and units 

because they are paid 100 percent of the 

Federal prospective rate under the IRF 

PPS. Therefore, it is also no longer 

necessary to update the payment 

limitation for new rehabilitation 

hospitals or units. 

For psychiatric hospitals and units, 

under the IPF PPS, there is a 3-year 

transition period during which existing 

IPFs will receive a blended payment of 

the Federal per diem payment amount 

and the payment amount that IPFs 

would receive under the reasonable 

cost-based payment (TEFRA) 

methodology. However, new IPFs (those 

facilities that under present or previous 

ownership (or both) have their first cost 

reporting period as an IPF begin on or 

after January 1, 2005, are paid the fully 

Federal per diem payment amount 

rather than a blended payment amount. 

23450 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

(See section VII.A.5. of the preamble of 

this proposed rule for further discussion 

of the IPF PPS.) Thus, the payment 

limitations under the TEFRA payment 

system are not applicable for new IPFs 

that meet the definition in § 412.426(c). 

However, ‘‘new’’ IPFs that meet the 

criteria under § 413.40(f)(2)(ii) (that is, 

that were not paid as an excluded 

hospital prior to October 1, 1997), but 

were paid as an IPF before January 1, 

2005, are paid under the IPF PPS 

transition methodology with the 

reasonable cost portion of the payment 

determined according to 

§ 413.40(f)(2)(ii), that is, subject to the 

payment amount limitation. The last 

‘‘new’’ IPFs that were subject to the 

payment amount limitation were IPFs 

that had their first cost reporting period 

beginning on December 31, 2004. For 

these hospitals, the payment amount 

limitation that was published in the FY 

2005 IPPS final rule (69 FR 49189) for 

cost reporting periods beginning on or 

after October 1, 2004, and before 

January 1, 2005, remains applicable for 

the IPF’s first two cost reporting 

periods. IPFs with a first cost reporting 

period beginning on or after January 1, 

2005, are paid 100 percent of the 

Federal rate and are not subject to the 

payment amount limitation. Therefore, 

since the last IPFs eligible for a blended 

payment have a cost reporting period 

beginning on December 31, 2004, the 

payment limitation published for FY 

2005 remains applicable for these IPFs, 

and publication of the updated payment 

amount limitation is no longer needed. 

We note that IPFs that existed prior to 

October 1, 1997, may also be paid under 

the IPF transition methodology with the 

reasonable cost portion of the payment 

subject to § 413.40(c)(4)(ii). 

The payment limitations for new 

hospitals under TEFRA do not apply to 

new LTCHs, IRFs, or IPFs, that is, these 

hospitals with their first cost reporting 

period beginning on or after the date 

that the particular class of hospitals 

implemented their respective PPS. 

Therefore, for the reasons noted above, 

we are proposing to discontinue 

publishing Tables 4G and 4H (PreReclassified Wage Index for Urban and 

Rural Areas, respectively) in the annual 

proposed and final IPPS rules. 

3. Implementation of a PPS for IRFs 

Section 1886(j) of the Act, as added by 

section 4421(a) of Pub. L. 105–33, 

provided for the phase-in of a case-mix 

adjusted PPS for inpatient hospital 

services furnished by a rehabilitation 

hospital or a rehabilitation hospital unit 

(referred to in the statute as 

rehabilitation facilities) for cost 

reporting periods beginning on or after 

October 1, 2000, and before October 1, 

2002, with payments based entirely on 

the adjusted Federal prospective 

payment for cost reporting periods 

beginning on or after October 1, 2002. 

Section 1886(j) of the Act was amended 

by section 125 of Pub. L. 106–113 to 

require the Secretary to use a discharge 

as the payment unit under the PPS for 

inpatient hospital services furnished by 

rehabilitation facilities and to establish 

classes of patient discharges by 

functional-related groups. Section 305 

of Pub. L. 106–554 further amended 

section 1886(j) of the Act to allow 

rehabilitation facilities, subject to the 

blend methodology, to elect to be paid 

the full Federal prospective payment 

rather than the transitional period 

payments specified in the Act. 

On August 7, 2001, we issued a final 

rule in the Federal Register (66 FR 

41316) establishing the PPS for 

inpatient rehabilitation facilities, 

effective for cost reporting periods 

beginning on or after January 1, 2002. 

There was a transition period for cost 

reporting periods beginning on or after 

January 1, 2002 and ending before 

October 1, 2002. For cost reporting 

periods beginning on or after October 1, 

2002, payments are based entirely on 

the Federal prospective payment rate 

determined under the IRF PPS. 

4. Implementation of a PPS for LTCHs 

In accordance with the requirements 

of section 123 of Pub. L. 106–113, as 

modified by section 307(b) of Pub. L. 

106–554, we established a per 

discharge, DRG-based PPS for LTCHs as 

described in section 1886(d)(1)(B)(iv) of 

the Act for cost reporting periods 

beginning on or after October 1, 2002, in 

a final rule issued on August 30, 2002 

(67 FR 55954). The LTCH PPS uses 

information from LTCH hospital patient 

records to classify patients into distinct 

LTC-DRGs based on clinical 

characteristics and expected resource 

needs. Separate payments are calculated 

for each LTC-DRG with additional 

adjustments applied. 

We published in the Federal Register 

on May 7, 2004, a final rule (69 FR 

25673) that updated the payment rates 

for the upcoming rate year LTCH PPS 

and made policy changes effective as of 

July 1, 2004. The 5-year transition 

period to the fully Federal prospective 

rate will end with cost reporting periods 

beginning on or after October 1, 2005 

and before October 1, 2006. For cost 

reporting periods beginning on or after 

October 1, 2006, payment is based 

entirely on the adjusted Federal 

prospective payment rate. However, 

existing hospitals can elect payment 

under 100 percent of the adjusted 

Federal prospective payment rate. 

Moreover, LTCHs as defined in 

§ 412.23(e)(4) are paid under 100 

percent of the adjusted Federal 

prospective payment rate. 

5. Implementation of a PPS for IPFs 

In accordance with section 124 of the 

BBRA and section 405(g)(2) of Pub. L. 

108–173, we established a PPS for 

inpatient hospital services furnished in 

psychiatric hospitals and psychiatric 

units of acute care hospitals and CAHs 

(inpatient psychiatric facilities (IPFs)). 

On November 15, 2004, we issued in the 

Federal Register a final rule (69 FR 

66922) that established the IPF PPS, 

effective for IPF cost reporting periods 

beginning on or after January 1, 2005. 

Under the final rule, we compute a 

Federal per diem base rate to be paid to 

all IPFs for inpatient psychiatric 

services based on the sum of the average 

routine operating, ancillary, and capital 

costs for each patient day of psychiatric 

care in an IPF, adjusted for budget 

neutrality. The Federal per diem base 

rate is adjusted to reflect certain patient 

characteristics, including age, specified 

DRGs, selected high-cost comorbidities, 

and day of the stay, and certain facility 

characteristics, including a wage index 

adjustment, rural location, indirect 

teaching costs, the presence of a fullservice emergency department, and 

cost-of-living adjustments for IPFs 

located in Alaska and Hawaii. We have 

established a 3-year transition period 

during which IPFs will be paid based on 

a blend of reasonable cost-based 

payment and IPF PPS payments. For 

cost reporting periods beginning on or 

after January 1, 2008, IPFs will be paid 

100 percent of the Federal per diem 

payment amount. 

B. Critical Access Hospitals (CAHs) 

(If you choose to comment on issues 

in this section, please include the 

caption ‘‘Critical Access Hospitals’’ at 

the beginning of your comment.) 

1. Background 

Section 1820 of the Act provides for 

the establishment of Medicare Rural 

Hospital Flexibility Programs 

(MRHFPs), under which individual 

States may designate certain facilities as 

critical access hospitals (CAHs). 

Facilities that are so designated and 

meet the CAH conditions of 

participation (CoPs) under 42 CFR Part 

485, Subpart F, will be certified as 

CAHs by CMS. Regulations governing 

payments to CAHs for services to 

Medicare beneficiaries are located in 42 

CFR Part 413. 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23451 

2. Proposed Policy Change Relating to 

Continued Participation by CAHs in 

Lugar Counties 

Criteria for the designation of a CAH 

under the MRHFP at section 

1820(c)(2)(b)(i) of the Act require that a 

hospital be located in a rural area as 

defined in section 1886(d)(2)(D) of the 

Act or be treated as being located in a 

rural area in accordance with section 

1886(d)(8)(E) of the Act. The regulations 

at § 485.610 further define ‘‘rural area’’

for purposes of being a CAH. Under 

§ 485.610(b), a CAH must meet any one 

of the following three location 

requirements. First, a CAH must not be 

located in an MSA as defined by the 

Office of Management and Budget, not 

be deemed to be located in an urban 

area under 42 CFR 412.63(b), and not be 

reclassified by CMS or the MGCRB as 

urban for purposes of the standardized 

payment amount, nor be a member of a 

group of hospitals reclassified to an 

urban area under 42 CFR 412.232. 

Second, if a CAH does not meet the first 

criterion, if located in an MSA, a CAH 

will be treated as rural if it has 

reclassified under 42 CFR 412.103. 

Third, as we stated in the FY 2005 IPPS 

final rule, if the CAH cannot meet either 

of the first two requirements and is 

located in a revised labor market area 

(CBSA) under the standards announced 

by OMB on June 6, 2003 and adopted 

by CMS effective October 1, 2004, it has 

until September 30, 2006, to meet one 

of the other classification requirements 

without losing its CAH status. 

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

Act, hospitals that are located in a rural 

county that is adjacent to one or more 

urban counties are considered to be 

located in the urban MSA to which the 

greatest number of workers in the 

county commute, if certain conditions, 

specified in section 1886(d)(8)(B) of the 

Act, are met. Regulations implementing 

this provision are set forth in 42 CFR 

412.62(f)(1) (for FY 1984), 42 CFR 

412.63(b)(3) (for FYs 1985 through 

2004), and at 42 CFR 412.64(b)(3) (for 

FY 2005 and subsequent fiscal years). 

The provision (section 1886(d)(8)(B) of 

the Act) is referred to as the ‘‘Lugar 

provision’’ and the counties described 

by it are referred to as the ‘‘Lugar 

counties.’’

As explained more fully in the FY 

2005 IPPS final rule (69 FR 48916), 

certain counties that previously were 

not considered Lugar counties were, 

effective October 1, 2004, redesignated 

as Lugar counties as a result of the most 

recent census data and the new labor 

market area definitions announced by 

OMB on June 6, 2003. Some CAHs 

located in these newly designated Lugar 

counties are now unable to meet the 

rural location requirements described 

above, even though they were in full 

compliance with the location 

requirements in effect at the time they 

converted from short-term acute care 

hospital to CAH status. 

We have received comments that 

suggest that it would be inappropriate 

for a facility to be required to terminate 

participation as a CAH and resume 

participating as a short-term acute care 

hospital because of a change in county 

classification that did not result from 

any change in functioning by the CAH. 

After consideration of these comments, 

we are clarifying our policy with respect 

to facilities located in Lugar counties. 

As we noted in the FY 2005 IPPS final 

rule, we believe it is appropriate to 

allow facilities located in counties that 

began to be considered part of MSAs 

effective October 1, 2004, as a result of 

data from the 2000 census and 

implementation of the new labor market 

area definitions announced by OMB on 

June 6, 2003, an opportunity to obtain 

rural designations under applicable 

State law or regulations from their State 

legislatures or regulatory agencies. 

Similarly, we believe that when a CAH’s 

status as being located in a Lugar county 

occurs as a result of changes that the 

CAH did not originate and that were 

beyond its control, such as a change in 

the OMB standards for labor market area 

definitions, it is appropriate for the CAH 

to be allowed a reasonable opportunity 

to reclassify to rural status. Thus, we are 

clarifying our policy to note that CAHs 

in counties that were designated as 

Lugar counties effective October 1, 

2004, because of implementation of the 

new labor market area definitions 

announced by OMB on June 6, 2003, are 

to be given the same reclassification 

opportunity. Of course, the opportunity 

to reclassify would not be available to 

a CAH if the CAH itself were to initiate 

some change, such as a redesignation as 

urban rather than rural under State law 

or regulations, which would invalidate 

a prior § 412.103 reclassification. As a 

result, we are proposing to make 

changes to § 485.610(b) of the 

regulations that would permit CAHs 

located in a county that, in FY 2004, 

was not part of a Lugar county, but as 

of FY 2005 was included in such a 

county as a result of the new labor 

market area definitions, to maintain 

their CAH status until September 30, 

2006. These changes, if adopted in final 

form, would permit CAHs in newly 

designated Lugar counties to continue 

participating in Medicare as CAHs until 

September 30, 2006. We expect that this 

will provide these CAHs with sufficient 

time to seek reclassification as rural 

facilities under the current regulations 

at § 412.103. In other words, after 

October 1, 2006, these facilities must 

meet at least one of the criteria in 

§ 412.103(a)(1) through (a)(3) to be 

eligible to reclassify from urban to rural 

status. Once the § 412.103 

reclassification is approved, the 

facilities would meet the CAH rural 

location requirements in § 485.610(b)(2). 

In addition, consistent with the 

clarification of the policy, we are 

proposing to amend the regulations at 

§ 412.103(a)(4) to reflect the proposed 

change in the text of the CAH location 

regulations at § 485.610(b)(3). 

In addition, we are making a technical 

amendment to § 485.610(b)(1)(ii) by 

replacing the reference to 42 CFR 

412.63(b) with 42 CFR 412.64(b). This 

proposed technical amendment would 

conform the regulations to reflect the 

rules governing geographic 

reclassification (found at § 412.64) that 

are already in place for fiscal years 

beginning on or after October 1, 2004 

(69 FR 49242). 

3. Proposed Policy Change Relating to 

Designation of CAHs as Necessary 

Providers 

Section 405(h) of Pub. L. 108–173 

amended section 1820(c)(2)(B)(i)(II) of 

the Act by adding language that 

terminated a State’s authority to waive 

the location requirement for a CAH by 

designating the CAH as a necessary 

provider, effective January 1, 2006. 

Currently, a CAH is required to be 

located more than a 35-mile drive (or in 

the case of mountainous terrain or 

secondary roads, a 15-mile drive) from 

a hospital or another CAH, unless the 

CAH is certified by the State as a 

necessary provider of health care 

services to residents in the area. Under 

this provision, after January 1, 2006, 

States will no longer be able to 

designate a CAH based upon a 

determination that it is a necessary 

provider of health care. In addition, 

section 405(h) of Pub. L. 108–173 

amended section 1820(h) of the Act to 

include a grandfathering provision for 

CAHs that are certified as necessary 

providers prior to January 1, 2006. In 

the FY 2005 IPPS final rule (69 FR 

49220), we incorporated these 

amendments in our regulations at 

§ 485.610 (c). Under that regulation, any 

CAH that is designated as a necessary 

provider in its State rural health plan 

prior to January 1, 2006, will be 

permitted to maintain its necessary 

provider designation. However, the 

regulations are limited to CAHs that 

were necessary providers as of January 

1, 2006, and does not address the 

23452 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

situation where the CAH is no longer 

the same facility due to relocation, 

cessation of business, or a substitute 

facility. Currently, CMS Regional 

Offices make the decision for continued 

certification following relocation of a 

certified facility on a case-by-case basis. 

The criteria used to qualify a CAH as 

a necessary provider were established 

by each State in its MRHFP. The State’s 

MRHFP defined those CAHs that 

provide necessary services to a 

particular patient community in the 

event that the facility did not meet the 

required 35-mile (or 15-mile with stated 

exceptions) distance requirement from 

the nearest hospital or CAH. Each 

State’s criteria are different, but the 

criteria share certain similarities and all 

define a necessary provider related to 

the facility location. Therefore, it 

becomes crucial to define whether the 

necessary provider designation remains 

pertinent in the event the certified CAH 

builds in a different location. 

Accordingly, the first step of this 

process is to determine whether 

building a new CAH facility in a 

different location is a replacement of an 

existing facility in essentially the same 

location, a relocation of the facility in a 

new location, or a cessation of business 

at one location and establishment of 

new business at another location. 

a. Determination of the Relocation 

Status of a CAH 

(1) Replacement in the same location. 

Under this approach, we are proposing 

that, if the CAH is constructing 

renovation of the same building in the 

same location, the renovation is 

considered to be a replacement of the 

same provider and not relocation. We 

would consider a construction of the 

CAH to be a replacement if construction 

was undertaken within 250 yards of the 

current building, as set by prior 

precedence in defining a hospital 

campus. In addition, if the replacement 

is constructed on land that is contiguous 

to the current CAH, and that land was 

owned by the CAH prior to enactment 

of Pub. L. 108–173, and the CAH is 

operating under a State-issued necessary 

provider waiver that is grandfathered by 

Pub. L. 108–173, we would consider 

that construction to be a replacement of 

the existing provider and the provisions 

of the grandfathered necessary provider 

designation would continue to apply 

regardless of when the construction or 

renovation work commenced and was 

completed. 

(2) Relocation of a CAH. Under our 

proposed approach, if the CAH is 

constructing a new facility in a location 

that does not qualify the construction as 

replacement of an existing facility in the 

same location under the criteria in the 

preceding paragraph, we would need to 

determine if this building would be a 

relocation of the current provider or a 

cessation of business at one location and 

establishment of a new business at 

another location. In the event of 

relocation, the CAH must ensure that 

the provider is functioning as 

essentially the same provider in order to 

operate under the same provider 

agreement. A provider that is changing 

location is considered to have closed the 

old facility if the original community or 

service area can no longer be expected 

to be served at the new location. The 

distance of the moved CAH from its old 

location will be considered, but it will 

not be the sole determining factor in 

granting the relocation of a CAH under 

the same provider agreement. For 

example, a specialty hospital may move 

a considerable distance and still care for 

generally the same inpatient population, 

while the relocation of a CAH at a 

relatively short distance within a rural 

area may greatly affect the community 

served. 

In the event that CMS determines the 

rebuilding of the CAH in a different 

location to be a relocation, the provider 

agreement would continue to apply to 

the CAH at the new location. In addition 

to the relocation being within the same 

service area, serving the same 

population, the CAH would need to be 

providing essentially the same services 

with the same staff; that is, at least 75 

percent of the same staff and 75 percent 

of the range of services are maintained 

in the new location as the same provider 

of services. We are proposing the use of 

a 75-percent threshold because we 

believe it indicates that the CAH that is 

relocating demonstrates that it will 

maintain a high level of involvement, as 

opposed to just a majority involvement, 

in the current community. We note that 

CMS has also used a 75-percent 

threshold in other provider designation 

policies such as the provider-based 

policies at § 413.65(e)(3)(ii). 

In all cases of relocation, the CAH 

must continue to meet all of the CoPs 

found at 42 CFR Part 485, Subpart F, 

including location in a rural area as 

provided for at § 485.610. 

(3) Cessation of business at one 

location. Under existing CMS policy, if 

the CAH relocation results in the 

cessation of furnishing services to the 

same community, we would not 

consider this to be a relocation, but 

instead would consider such a scenario 

a cessation of business at one location 

and establishment of a new business at 

another location. Cessation of business 

is a basis for voluntary termination of 

the provider agreement under 42 CFR 

Part 489. If the proposed move 

constitutes a cessation of business, the 

CMS Regional Office may assist the 

provider in obtaining an agreement to 

participate under a new provider 

number. Furthermore, in such a 

situation, the regulations require the 

provider to give advanced notice to 

CMS and the public regarding its intent 

to stop providing medical services to the 

community. There is no appeals process 

for a voluntary termination. Under our 

current policies, the cessation of 

business by a CAH automatically 

terminates the CAH designation, 

regardless of whether the designation 

was obtained through a necessary 

provider determination. 

b. Relocation of a CAH Using a 

Necessary Provider Designation To Meet 

the CoP for Distance 

Once it has been determined that 

constructing a new facility will cause 

the CAH to relocate, the second step is 

to determine if the CAH that has a 

necessary provider designation can 

maintain this designation after 

relocating. 

We recognize that § 485.610(c) 

relating to location relative to other 

facilities or necessary provider 

certification states that, after January 1, 

2006, the ‘‘necessary provider’’

designation will no longer be used to 

waive the mileage requirements. In 

addition, CMS policy regarding a 

change of size or location of a provider 

states that there may be situations where 

the facility relocation is so far removed 

from the originally approved site that 

we would conclude that this is a 

different provider or supplier, for 

example, it has different employees, 

services, and patients. Furthermore, the 

language of section 1820(c)(2)(i) of the 

Act allows a State to waive the mileage 

requirement and designate a facility as 

a necessary provider of health care 

services to residents in the area. We 

have interpreted ‘‘services to residents 

in the area’’ to mean that the necessary 

provider designation does not 

automatically follow the provider if the 

facility relocates to a different location 

because it is no longer furnishing 

‘‘services to patients’’ in the area 

determined to need a necessary 

provider. 

We do not intend to change this 

policy. Our proposal, noted below, is 

intended to establish a methodology to 

be used by all CMS Regional Offices in 

making such a decision consistent with 

the statutory provisions concerning 

necessary provider designation. 

In this proposed rule, we are 

proposing to amend the regulations at 

§ 485.610 to set forth the criteria by 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23453 

which those relocated CAHs designated 

as necessary providers that embarked on 

a replacement facility project before the 

sunset provision was enacted on 

December 8, 2003, but find that they 

cannot be operational in the 

replacement facility by January 1, 2006, 

can retain their necessary provider 

status. As required by statute, no 

additional CAHs will be certified as a 

necessary provider on or after January 1, 

2006. We recognize that the statute 

refers to a facility designated as a CAH 

while relocation of a facility may result 

in a different building. However, to 

provide flexibility for a facility 

designated as a CAH whose location 

may change, but is essentially the same 

facility in a different location, we are 

proposing to amend the regulations to 

account for this scenario. Essentially, 

we recognize that the necessary 

provider designation may need to be 

applied to certain relocated CAHs. To 

this end, we are proposing to use the 

specified relocation criteria as the initial 

step to determine continuing necessary 

provider status. Specifically, in this 

proposed rule, we are proposing that, 

when a CAH is determined to have 

relocated, it may nonetheless continue 

to operate under its necessary provider 

designation that exempts the distance 

from other providers only if the 

following conditions are met: 

(1) The relocated CAH has submitted 

an application to the State agency for 

relocation prior to the January 1, 2006, 

sunset date. If the CAH is applying 

under a grandfathered status under 

section 1820(h)(3) of the Act, the 

following items would need to be 

included in the application: 

• A demonstration that the CAH will 

meet the same State criteria for the 

necessary provider designation that 

were established when the waiver was 

originally issued. For example, if the 

location waiver was granted because the 

CAH was located in a health 

professional shortage area (HPSA), the 

CAH must remain in that HPSA. 

• Assurance that, after the relocation, 

the CAH will be servicing the same 

community and will be operating 

essentially the same services with 

essentially the same staff (that is, a 

demonstration that it is serving at least 

75 percent of the same service area, with 

75 percent of the same services offered, 

and staffed by 75 percent of the same 

staff, including medical staff, contracted 

staff, and employees). This is essentially 

the same criteria used in determining 

whether the CAH has relocated. 

• Assurance that the CAH will remain 

in compliance with all of the CoPs at 42 

CFR Part 485 in the new location. 

Compliance will be established with a 

full survey in the new location to 

include the Life Safety Code and would 

include any off-site locations and 

rehabilitation or psychiatric distinct 

part units. 

• A demonstration that construction 

plans were ‘‘under development’’ prior 

to the effective date of Pub. L. 108–173 

(December 8, 2003) in the application 

the CAH submits to continue using a 

necessary provider designation. 

Supporting documentation could 

include the drafting of architectural 

specifications, the letting of bids for 

construction, the purchase of land and 

building supplies, documented efforts to 

secure financing for construction, 

expenditure of funds for construction, 

and compliance with state requirements 

for construction such as zoning 

requirements, application for a 

certificate of need, and architectural 

review. However, we recognize that it 

may not have been feasible for a CAH 

to have completed all of these activities 

noted above as examples prior to 

December 8, 2003. Thus, we expect the 

CMS Regional Offices to consider all of 

the criteria and make case-by-case 

determinations of whether a relocated 

CAH continues to warrant necessary 

provider status. We note that we have 

also used the above documentation 

guidelines in Publication 100–20 for 

grandfathered specialty hospitals to 

determine if construction plans were 

‘‘under development.’’

In proposing these criteria, our intent 

in clarifying the sunset of the necessary 

provider designation provision is to 

allow CAHs to complete construction 

projects that were initiated prior to the 

enactment of Pub. L. 108–173, which we 

believe is consistent with the statutory 

language of section 405(h) of Pub. L. 

108–173. 

(2) In the application, the CAH 

demonstrates that the replacement will 

facilitate the access to care and improve 

the delivery of services to Medicare 

beneficiaries. We are soliciting 

comments on how a necessary provider 

CAH should demonstrate that the 

replacement will improve access to care. 

These guidelines are meant to be 

applied to the relocated CAH that meets 

the CoP in the new location and wishes 

to maintain a necessary provider 

designation in order to meet the 

distance requirement at § 485.610(c). 

They are not meant to preclude a CAH 

from relocating at any time if the CAH 

does not seek to maintain the necessary 

provider designation. Any CAH may 

relocate at any time if the CAH meets 

the definition of relocation and can 

meet all the CoPs at 42 CFR part 485, 

subpart F, as determined by the CMS 

Regional Offices on a case-by-case basis. 

Accordingly, we are proposing to 

revise § 485.610 of the regulations by 

adding a new paragraph (d) to 

incorporate this proposal. Specifically, 

the proposed new paragraph (d) would 

specify that a CAH may maintain its 

necessary provider certification 

provided for under § 485.610(c) if the 

new facility meets the requirements for 

either a replacement facility that is 

constructed within 250 yards of the 

current building or contiguous to the 

current CAH on land owned by the CAH 

prior to December 8, 2003; or as a 

relocated CAH if, at the relocated site, 

the CAH provides essentially (75 

percent) the same services to the same 

service area with essentially the same 

staff. The CAH that plans to relocate 

must provide documentation 

demonstrating that its plans to rebuild 

in the relocated area were undertaken 

prior to December 8, 2003. We are also 

proposing that if a CAH that has a 

necessary provider certification from the 

State places a new facility in service on 

or after January 1, 2006, and does not 

meet either the requirements for a 

replacement facility or a relocated 

facility, as specified in the regulations, 

the action will be considered a cessation 

of business. 

VIII. Payment for Blood Clotting Factor 

Administered to Hemophilia Inpatients 

(If you choose to comment on issues 

in this section, please include the 

caption ‘‘Blood Clotting Factor’’ at the 

beginning of your comment.) 

Section 1886(a)(4) of the Act excludes 

the costs of administering blood clotting 

factors to individuals with hemophilia 

from the definition of ‘‘operating costs of 

inpatient hospital services.’’ Section 

6011(b) of Pub. L. 101–239 (the 

Omnibus Budget Reconciliation Act of 

1989) states that the Secretary of Health 

and Human Services shall determine the 

payment amount made to hospitals 

under Part A of Title XVIII of the Act 

for the costs of administering blood 

clotting factors to individuals with 

hemophilia by multiplying a 

predetermined price per unit of blood 

clotting factor by the number of units 

provided to the individual. The 

regulations governing payment for blood 

clotting factor furnished to hospital 

inpatients are located in §§ 412.2(f)(8) 

and 412.115(b). 

Consistent with the rates paid under 

section 1842(o) of the Act for Medicare 

Part B drugs (including blood clotting 

factor furnished to individuals who are 

not inpatients), in FY 2005, we made 

payments for blood clotting factors 

furnished to inpatients at 95 percent of 

average wholesale price (AWP). Section 

303 of Pub. L. 108–173 established 

23454 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

section 1847A of the Act which requires 

that almost all Medicare Part B drugs 

not paid on a cost or prospective basis 

be paid at 106 percent of average sales 

price (ASP) and provided for payment 

of a furnishing fee for blood clotting 

factor, effective January 1, 2005. On 

November 15, 2004, we issued 

regulations in the Federal Register (69 

FR 66299) that implemented the 

provisions of section 1847A for payment 

for Medicare Part B drugs using the 106 

percent of ASP payment methodology 

and for payment of the furnishing fee. 

These regulations are codified at 42 CFR 

410.63 and subpart K of Part 414. 

To ensure consistency in payment for 

Medicare Part A and Medicare Part B 

drugs, we are proposing to revise 

§§ 412.2(f)(8) and 412.115(b) of the 

regulations governing the IPPS to 

specify that, for discharges occurring on 

or after October 1, 2005, the additional 

payment for the blood clotting factor 

administered to hemophilia inpatients 

is made based on the average sales price 

methodology specified in subpart K of 

42 CFR part 414 and the furnishing fee 

specified in § 410.63. 

The proposed payment amount per 

unit and the unit payment for the 

furnishing fee for blood clotting factor 

administered to hospital inpatients who 

have hemophilia that we are proposing 

to apply under the IPPS for FY 2006 are 

specified in section V. of the Addendum 

to this proposed rule. 

IX. MedPAC Recommendations 

(If you choose to comment on issues 

in this section, please include the 

caption ‘‘MedPAC Recommendations’’ at 

the beginning of your comment.) 

We are required by section 

1886(e)(4)(B) of the Act to respond to 

MedPAC’s IPPS recommendations in 

our annual proposed IPPS rule. In 

March 2005, MedPAC released the 

following two reports to Congress, 

which included IPPS recommendations: 

‘‘Report to Congress: Medicare Payment 

Policy’’ and ‘‘Report to Congress: 

Physician-Owned Specialty Hospitals.’’

We have reviewed each of these reports 

and have given them careful 

consideration in conjunction with the 

policies set forth in this document. 

These recommendations and our 

responses are set forth below. For 

further information relating specifically 

to the MedPAC reports or to obtain a 

copy of the reports, contact MedPAC at 

(202) 653–7220, or visit MedPAC’s Web 

site at: http://www.medpac.gov. 

A. Medicare Payment Policy 

MedPAC’s Recommendation 2A–1 

concerning the update factor for 

inpatient hospital operating costs and 

for hospitals and distinct-part hospital 

units excluded from the IPPS is 

discussed in Appendix B to this 

proposed rule. 

Recommendation 4A: The Congress 

should establish a quality incentive 

payment policy for hospitals in 

Medicare. 

Response: We are exploring provider 

payment policies that link quality to 

Medicare reimbursement in a cost 

neutral manner under our 

demonstration authority. We currently 

have demonstrations underway that will 

identify and examine the components of 

such a policy. 

B. Physician-Owned Specialty Hospitals 

Recommendation 1: The Secretary 

should improve payment accuracy in 

the hospital inpatient PPS by: 

• Refining the current DRGs to more 

fully capture differences in severity of 

illness among patients. 

• Basing the DRG relative weights on 

the estimated cost of providing care 

rather than on charges. 

• Basing the weights on the national 

average of hospitals’ relative values in 

each DRG. 

In making this recommendation, 

MedPAC recognized several 

implementation issues regarding 

potential low volume DRGs and 

potential changes in hospital coding and 

reporting behavior. In particular, 

MedPAC recommended that the 

Secretary project the likely effect of 

reporting improvements on total 

payments and make an offsetting 

adjustment to the standardized 

amounts. 

Response: We expect to make changes 

to the DRGs to better reflect severity of 

illness. The following discussion briefly 

describes some of the options we are 

considering. As we discussed in section 

II.B. of this preamble, there is a standard 

list of diagnoses that are considered 

complications or comorbidities (CC). 

These conditions, when present as a 

secondary diagnosis, may result in 

payment using a higher weighted DRG. 

Currently, 3,285 diagnosis codes on this 

list, and 121-paired DRGs are 

differentiated based on the presence or 

absence of a CC. Our analysis indicates 

that the majority of cases assigned to 

these DRGs fall into the ‘‘with CC’’

DRGs. We believe that it is possible that 

the CC distinction has lost much of its 

ability to differentiate the resource 

needs of patients, given the long period 

of time since the original CC list was 

developed and the incremental nature of 

subsequent changes in an environment 

of major changes in the way inpatient 

care is delivered. 

We are planning a comprehensive and 

systematic review of the CC list for the 

IPPS rule for FY 2007. As part of this 

process, we will consider revising the 

standard for determining when a 

condition is a CC. For instance, we 

expect to use an alternative to the 

current method of classifying a 

condition as a CC based on how it 

affects the length of stay of a case. 

Similar to other aspects of the DRG 

system, we expect to consider the effect 

of a specific secondary diagnosis on the 

charges or costs of a case to evaluate 

whether to include the condition on the 

CC list. 

Another option we are considering is 

a selective review of the specific DRGs, 

such as cardiac, orthopedic, and 

surgical DRGs, that are alleged to be 

overpaid and that create incentives for 

physicians to form specialty hospitals. 

We expect to selectively review 

particular DRGs based on statistical 

criteria such as the range or standard 

deviation among charges for cases 

included within the DRG. It is possible 

specific DRGs have high variation in 

resource costs and that a better 

recognition of severity would reduce 

incentives for hospitals to select the 

least costly and most profitable patients 

within these DRGs. Any analysis we 

perform would balance the goal of 

making payment based on an accurate 

coding system that recognizes severity 

of illness with the premise that the IPPS 

is a system of payment based on 

averages. We agree with MedPAC that, 

in refining the DRGs, we must continue 

to be mindful of issues such as the 

instability of small volume DRGs and 

the potential impact of changes in 

hospital coding and reporting behavior. 

As MedPAC noted, previous 

refinements to DRG definitions have led 

to unanticipated increases in payment 

because of more complete reporting of 

patients’ diagnoses and procedures. As 

part of our analysis of possible 

refinements to the DRGs, we have 

concerns with our ability to account for 

the effect of changes in coding behavior 

on payment. 

We are also considering the use of 

alternative DRG systems such as the all 

patient refined diagnosis related groups 

(APR–DRGs) in place of Medicare’s 

current DRG system. The APR–DRGs 

have a greater number of DRGs that 

could relate payment rates more closely 

to patient resource needs, and thus 

reduce the advantages of selection of 

desirable patients within DRGs by 

specialty hospitals. However, any large 

change to the DRGs could have 

substantial effects across all hospitals. 

Therefore, we believe we must 

thoroughly analyze such options and 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23455 

5Cost Accounting for Health Care Organizations, 

Technical Report Series, 1–93–01, ProPAC, March 

1993, page 6. Using a cost report package, the 

contractor simulated single and multiple ancillary 

cost-to-charge ratios and found that inpatient 

ancillary costs were 2.5 percent understated relative 

to what hospitals thought their costs were with the 

single cost-to-charge ratio, and 4.9 percent 

understated with the multiple cost-to-charge ratios. 

their impacts on the various types of 

hospitals before making any proposal. In 

addition, as noted above, we are 

concerned about our ability to account 

for the effect of changes in coding 

behavior on payment if we were to 

significantly expand the number of 

DRGs. Therefore, in light of the above, 

we must consider how to mitigate the 

risk of paying significantly more for the 

alternatives discussed above while 

measuring the benefit for Medicare 

beneficiaries. 

In response to MedPAC’s 

recommendation that we improve 

payment accuracy by basing the DRG 

relative weights on the estimated cost of 

providing care rather than on charges, 

we note that we do not have access to 

any information that would provide a 

direct measure of the costs of individual 

discharges. Claims filed by hospitals do 

provide information on the charges for 

individual cases. At present, we use this 

information to set the relative weights 

for the DRGs. We obtain information on 

costs from the hospital cost reports, but 

this information is at best at the 

department level; it does not include 

information about the costs of 

individual cases. Consequently, the 

most straightforward way to estimate 

costs of an individual case is to 

calculate a cost-to-charge ratio for some 

body of claims (for example, for a 

hospital’s radiology department), and 

then apply this ratio to the charges for 

that department. 

However, this procedure is not 

without disadvantages because 

assignment of costs to departments is 

not uniform from hospital to hospital, 

given the variability of hospital 

accounting systems, and because cost 

information is not available until a year 

or more after claims information. In 

addition, the application of a cost-tocharge ratio that is uniform across any 

body of claims may result in biased 

estimates of individual costs if hospital 

charging behavior is not uniform. Thus, 

it is alleged that hospitals mark up 

lower cost services less than higher cost 

services, and to the extent they do so, 

application of a uniform cost-to-charge 

ratio will result in underestimates of the 

costs of higher cost services and vice 

versa. We use estimated costs, based on 

hospital-specific, department-level costto-charge ratios, in the hospital 

outpatient prospective payment system. 

The accuracy of this procedure has 

generated some concern, and without 

further analysis, the extent to which 

accuracy of inpatient payments would 

be improved by adopting this method is 

not obvious. 

We will closely analyze the impact of 

such a change from the current chargebased DRG weights to cost-based DRG 

weights. We note that such a change is 

complex and would require further 

analysis. With this in mind, CMS will 

consider the following issues in 

performing this analysis: 

• The effect of using cost-to-charge 

ratio data, which is frequently older 

than the claims data we use to set the 

charge-based weights, and the impact on 

these data of any changes in hospitals’

charging behavior that resulted from the 

recent modifications to the outlier 

payment methodology (68 FR 34494; 

June 9, 2003); 

• Whether using this method has 

different effects on DRGs that have 

experienced substantial technological 

change compared to DRGs with more 

stable procedures for care; 

• The effect of using a routine cost-tocharge ratio and department-level 

ancillary cost-to-charge data as 

compared to either an overall hospital 

cost-to-charge ratio or a routine cost-tocharge ratio and an overall ancillary 

cost-to-charge ratio, particularly in 

considering earlier studies performed 

for the Prospective Payment Assessment 

Commission, the predecessor to 

MedPAC, indicating that an overall 

ancillary cost-to-charge ratio led to more 

accurate estimates of case level costs; 5

• Whether developing relative 

weights by estimating costs from 

charges multiplied by cost-to-charge 

ratios versus whether the sole use of 

charges improves payment accuracy; 

and 

• How payments to hospitals would 

be affected by MedPAC’s suggestion 

intended to simplify recalibration, to 

recalibrate weights based on costs every 

few years, and to calculate an 

adjustment to charge-based weights for 

the intervening periods. 

In response to the recommendation 

that the Secretary should improve 

payment accuracy in the IPPS by basing 

the weights on the national average of 

hospitals’ relative values in each DRG, 

we note that presently we set the 

relative weights using standardized 

charges (adjusted to remove the effects 

of differences in area wage costs and in 

IME and DSH payments). In contrast, 

MedPAC proposes that Medicare set the 

DRG relative weights using 

unstandardized, hospital-specific 

charges. Each hospital’s unstandardized 

charges would become the basis for 

determining the relative weights for the 

DRGs for that hospital. These relative 

weights would be adjusted by the 

hospital’s case-mix index when 

combining each hospital’s relative 

weights to determine a national relative 

weight for all hospitals. This adjustment 

is designed to reduce the influence that 

a single hospital’s charge structure 

could have on determining the relative 

weight when it provides a high 

proportion of the total, nationwide 

number of discharges in a particular 

DRG. 

We will analyze the possibility of 

moving to hospital specific relative 

values while conducting the analysis 

outlined above in response to the 

recommendations regarding improved 

severity adjustment and using charges 

adjusted to estimated cost using cost-tocharge ratios to set the relative weights. 

We note that we use this method at 

present to set weights for the LTCH PPS. 

We use this method for LTCHs because 

of the small volume of providers and the 

possibility that only a few providers 

provide care for certain DRGs. The 

charges of one or a few hospitals could 

thus materially affect the relative 

weights for these DRGs. In this event, 

looking at relative values within 

hospitals first can smooth out the 

hospital-specific effects on DRG 

weights. A 1993 Rand Report on 

hospital specific relative values noted 

the possibility of DRG compression (or 

the undervaluing of high-cost cases and 

the overvaluing of low-cost cases) if we 

were to shift to a hospital-specific 

relative value method from the current 

method for determining DRG weights. 

We will need to consider whether the 

resultant level of compression is 

appropriate. 

Recommendation 2: The Congress 

should amend the law to give the 

Secretary authority to adjust the DRG 

relative weights to account for 

differences in the prevalence of highcost outlier cases. 

Response: While MedPAC’s language 

suggests that the law would need to be 

amended for us to adopt this suggestion, 

we believe the statute may give the 

Secretary broad discretion to consider 

all factors that change the relative use of 

hospital resources in calculating the 

DRG relative weights. We believe that 

MedPAC’s recommendation springs 

from a concern that including highcharge outlier cases in the relativeweight calculation results in 

overvaluing DRGs that have a high 

prevalence of outlier cases. However, 

we believe that excluding outlier cases 

completely in calculating the relative 

weights would be inappropriate. Doing 

23456 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

so would undervalue the relative weight 

for a DRG with a high percentage of 

outliers by not including that portion of 

hospital charges that is above the 

median but below the outlier threshold. 

We believe it would be preferable to 

adjust the charges used for calculating 

the relative weights to exclude the 

portion of charges above the outlier 

threshold but to include the charges up 

to the outlier threshold. At this time, we 

expect to further analyze these ideas as 

we consider the other changes 

recommended by MedPAC and 

welcome public comments on this issue. 

Finally, we believe that the 

recommendations made by MedPAC, or 

some variants of them, have significant 

promise in improving the accuracy of 

rates in the inpatient payment 

prospective payment system. We agree 

with MedPAC that they should be 

pursued even in the absence of concerns 

about the proliferation of specialty 

hospitals. However, until we have 

completed further analysis of these 

options and their effects, we cannot 

predict the extent to which they will 

provide payment equity between 

specialty and general hospitals. In fact, 

we must caution that any system that 

groups cases and provides a standard 

payment for cases in the group (that is, 

the IPPS among other Medicare 

payment systems) will always present 

some opportunities for providers to 

specialize in cases where they believe 

margins may be better. Improving 

payment accuracy should reduce these 

opportunities, and it may do so to the 

extent that Medicare payments no 

longer provide a significant impetus to 

further development of specialty 

hospitals. 

Recommendation 3: The Congress and 

the Secretary should implement the 

case-mix measurement and outlier 

policies over a transitional period. 

Response: Before proposing any 

changes to the DRGs, we would need to 

model the impact of any specific 

proposal and our authority under the 

statute to determine whether any 

changes should be implemented 

immediately or over a period of time. 

We do note that with regard to revising 

the existing DRG system with a new 

DRG system that fully captures 

differences in severity, there would 

likely be unique complexities in 

creating a transition from one DRG 

system to another. Our payment would 

be a blend of two different relative 

weights that would have to be 

determined using two different systems 

of DRGs. The systems and legal 

implications of such a transition or any 

other major change to the DRGs could 

be significant. 

C. Other MedPAC Recommendations 

MedPAC also made the following 

recommendations that we will address 

in our Report to Congress on Specialty 

Hospitals: 

Recommendation 4: The Congress 

should extend the current [Pub. L. 108–

173] moratorium on physician-owned 

single specialty hospitals until January 

1, 2007. 

Recommendation 5: The Congress 

should grant the Secretary the authority 

to allow gainsharing arrangements 

between physicians and hospitals and to 

regulate those arrangements to protect 

the quality of care and minimize 

financial incentives that could affect 

physician referrals. 

X. 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 

established a process under which 

commenters can gain access to raw data 

on an expedited basis. Generally, the 

data are available in computer tape or 

cartridge format; however, some files are 

available on diskette as well as on the 

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

providers/hipps. Data files and the cost 

for each file, if applicable, are listed 

below. Anyone wishing to purchase 

data tapes, cartridges, or diskettes 

should submit a written request along 

with a company check or money order 

(payable to CMS–PUF) to cover the cost 

to the following address: Centers for 

Medicare & Medicaid Services, Public 

Use Files, Accounting Division, P.O. 

Box 7520, Baltimore, MD 21207–0520, 

(410) 786–3691. Files on the Internet 

may be downloaded without charge. 

1. CMS Wage Data 

This file contains the hospital hours 

and salaries for FY 2002 used to create 

the FY 2006 prospective payment 

system wage index. The file will be 

available by the beginning of February 

for the NPRM and the beginning of May 

for the final rule. 


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These files support the following: 

• NPRM published in the Federal 

Register. 

• Final Rule published in the Federal 

Register. 

Media: Diskette/most recent year on 

the Internet. 

File Cost: $165.00 per year. 

Periods Available: FY 2006 PPS 

Update. 

2. CMS Hospital Wages Indices 

(Formerly: Urban and Rural Wage Index 

Values Only) 

This file contains a history of all wage 

indices since October 1, 1983. 

Media: Diskette/most recent year on 

the Internet. 

File Cost: $165.00 per year. 

Periods Available: FY 2006 PPS 

Update. 

3. FY 2006 Proposed Rule Occupational 

Mix Adjusted and Unadjusted AHW by 

Provider 

This file includes each hospital’s 

adjusted and unadjusted average hourly 

wage. 

Media: Internet. 

Periods Available: FY 2006 PPS 

Update. 

4. FY 2006 Proposed Rule Occupational 

Mix Adjusted and Unadjusted AHW and 

Pre-Reclassified Wage Index by CBSA 

This file includes each CBSA’s 

adjusted and unadjusted average hourly 

wage. 

Media: Internet. 

Periods Available: FY 2006 PPS 

Update. 

5. Provider Occupational Mix 

Adjustment Factors for Each 

Occupational Category 

This file contains each hospital’s 

occupational mix adjustment factors by 

occupational category. 

Media: Internet. 

Periods Available: FY 2006 PPS 

Update. 

6. PPS SSA/FIPS MSA State and County 

Crosswalk. 

This file contains a crosswalk of State 

and county codes used by the Social 

Security Administration (SSA) and the 

Federal Information Processing 

Standards (FIPS), county name, and a 

historical list of Metropolitan Statistical 

Areas (MSAs). 

Media: Diskette/Internet. 

File Cost: $165.00 per year. 

Periods Available: FY 2006 PPS 

Update. 

7. Reclassified Hospitals New Wage 

Index (Formerly: Reclassified Hospitals 

by Provider Only) 

This file contains a list of hospitals 

that were reclassified for the purpose of 

assigning a new wage index. Two 

versions of these files are created each 

year. They support the following: 

• NPRM published in the Federal 

Register. 

• Final Rule published in the Federal 

Register. 

Media: Diskette/Internet. 

File Cost: $165.00 per year. 

Periods Available: FY 2006 PPS 

Update. 

8. PPS–IV to PPS–XII Minimum Data 

Set 

The Minimum Data Set contains cost, 

statistical, financial, and other 

information from Medicare hospital cost 

reports. The data set includes only the 

most current cost report (as submitted, 

final settled, or reopened) submitted for 

a Medicare participating hospital by the 

Medicare fiscal intermediary to CMS. 

This data set is updated at the end of 

each calendar quarter and is available 

on the last day of the following month. 

Media: Tape/Cartridge. 

File Cost: $770.00 per year. 

(Note: The PPS–XIII, PPS–XIV, PPS–XV, 

PPS–XVI, PPS–XVII, PPS–XVIII, and PPS–

XIX Minimum Data Sets are part of the PPS–

XIII, PPS–XIV, PPS–XV, PPS–XVI, PPS–XVII, 

PPS–XVIII, PPS–XIX, and PPS–XX Hospital 

Data Set Files (refer to item 7 below).) 

9. PPS–IX to PPS–XII Capital Data Set 

The Capital Data Set contains selected 

data for capital-related costs, interest 

expense and related information and 

complete balance sheet data from the 

Medicare hospital cost report. The data 

set includes only the most current cost 

report (as submitted, final settled or 

reopened) submitted for Medicare 

certified hospital by the Medicare fiscal 

intermediary to CMS. This data set is 

updated at the end of each calendar 

quarter and is available on the last day 

of the following month. 

Media: Tape/Cartridge. 

Fine Cost: $770.00 per year. 


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(Note: The PPS–XIII, PPS–XIV, PPS–XV, 

PPS–XVI, PPS–XVII, PPS–XVIII, and PPS–

XIX Capital Data Sets are part of the PPS–

XIII, PPS–XIV, PPS–XV, PPS–XVI, PPS–XVII, 

PPS–XVIII, PPS–XIX, and PPS–XX Hospital 

Data Set Files (refer to item 7 below).) 

10. PPS–XIII to PPS–XX Capital Data Set 

The file contains costs, statistical, 

financial, and other data from the 

Medicare Hospital Cost Report. The data 

set includes only the most current cost 

report (as submitted, final settled or 

reopened) submitted for Medicarecertified hospital by the Medicare fiscal 

intermediary to CMS. This data set is 

updated at the end of each calendar 

quarter and is available on the last day 

of the following month. 

Media: Diskette/Internet. 

Fine Cost: $2,500.00. 

11. Provider-Specific File 

This file is a component of the 

PRICER program used in the fiscal 

intermediary’s system to compute DRG 

payments for individual bills. The file 

contains records for all prospective 

payment system eligible hospitals, 

including hospitals in waiver States, 

and data elements used in the 

prospective payment system 

recalibration processes and related 

activities. Beginning with December 

1988, the individual records were 

enlarged to include pass-through per 

diems and other elements. 

Media: Diskette/Internet. 

File Cost: $265.00. 

Periods Available: FY 2006 PPS 

Update. 

12. CMS Medicare Case-Mix Index File 

This file contains the Medicare casemix index by provider number as 

published in each year’s update of the 

Medicare hospital inpatient prospective 

payment system. The case-mix index is 

a measure of the costliness of cases 

treated by a hospital relative to the cost 

of the national average of all Medicare 

hospital cases, using DRG weights as a 

measure of relative costliness of cases. 

Two versions of this file are created 

each year. They support the following: 

• NPRM published in the Federal 

Register. 

• Final rule published in the Federal 

Register. 

Media: Diskette/most recent year on 

Internet. 

Price: $165.00 per year/per file. 

Periods Available: FY 1985 through 

FY 2006. 

13. DRG Relative Weights (Formerly 

Table 5 DRG) 

This file contains a listing of DRGs, 

DRG narrative description, relative 

weights, and geometric and arithmetic 

mean lengths of stay as published in the 

Federal Register. The hard copy image 

has been copied to diskette. There are 

two versions of this file as published in 

the Federal Register: 

• NPRM. 

• Final rule. 

Media: Diskette/Internet. 

File Cost: $165.00. 

Periods Available: FY 2006 PPS 

Update. 

14. PPS Payment Impact File 

This file contains data used to 

estimate payments under Medicare’s 

hospital inpatient prospective payment 

systems for operating and capital-related 

costs. The data are taken from various 

sources, including the Provider-Specific 

File, Minimum Data Sets, and prior 

impact files. The data set is abstracted 

from an internal file used for the impact 

analysis of the changes to the 

prospective payment systems published 

in the Federal Register. This file is 

available for release 1 month after the 

proposed and final rules are published 

in the Federal Register. 

Media: Diskette/Internet. 

File Cost: $165.00. 

Periods Available: FY 2006 PPS 

Update. 

15. AOR/BOR Tables 

This file contains data used to 

develop the DRG relative weights. It 

contains mean, maximum, minimum, 

standard deviation, and coefficient of 

variation statistics by DRG for length of 

stay and standardized charges. The BOR 

tables are ‘‘Before Outliers Removed’’

and the AOR is ‘‘After Outliers 

Removed.’’ (Outliers refers to statistical 

outliers, not payment outliers.) 

Two versions of this file are created 

each year. They support the following: 

• NPRM published in the Federal 

Register. 

• Final rule published in the Federal 

Register. 

Media: Diskette/Internet. 

File Cost: $165.00. 

Periods Available: FY 2006 PPS 

Update. 


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16. Prospective Payment System (PPS) 

Standardizing File 

This file contains information that 

standardizes the charges used to 

calculate relative weights to determine 

payments under the prospective 

payment system. Variables include wage 

index, cost-of-living adjustment (COLA), 

case-mix index, disproportionate share, 

and the Metropolitan Statistical Area 

(MSA). The file supports the following: 

• NPRM published in the Federal 

Register. 

• Final rule published in the Federal 

Register. 

Media: Internet. 

File Cost: No charge. 

Periods Available: FY 2006 PPS 

Update. 

For further information concerning 

these data tapes, contact the CMS Public 

Use Files Hotline at (410) 786–3691. 

Commenters interested in obtaining or 

discussing any other data used in 

constructing this rule should contact 

Mark Hartstein at (410) 786–4548. 

B. Collection of Information 

Requirements 

Under the Paperwork Reduction Act 

of 1995 (PRA), we are required to 

provide 60-day notice in the Federal 

Register and solicit public comment 

before a collection of information 

requirement is submitted to the Office of 

Management and Budget (OMB) for 

review and approval. In order to 

evaluate fairly whether an information 

collection should be approved by OMB, 

section 3506(c)(2)(A) of the Paperwork 

Reduction Act of 1995 requires that we 

solicit comment on the following issues: 

• The need for the information 

collection and its usefulness in carrying 

out the proper functions of our agency. 

• The accuracy of our estimate of the 

information collection burden. 

• The quality, utility, and clarity of 

the information to be collected. 

• Recommendations to minimize the 

information collection burden on the 

affected public, including automated 

collection techniques. 

Therefore, we are soliciting public 

comments on each of these issues for 

the information collection requirements 

discussed below. 

The following information collection 

requirements included in this proposed 

rule and their associated burdens are 

subject to the PRA. 

Section 412.64 Federal Rates for 

Inpatient Operating Costs for Federal 

Fiscal Year 2005 and Subsequent Fiscal 

Years 

Section 412.64(d)(2) requires 

hospitals to submit quality data on a 

quarterly basis to CMS, as specified by 

CMS. In this document, we are setting 

out the specific requirements related to 

the data that must be submitted. The 

burden associated with this section is 

the time and effort associated with 

collecting, copying and submitting this 

data. We estimate that there will be 

approximately 4,000 respondents per 

year. Of this number, approximately 

3,600 hospitals are JCAHO accredited 

and are currently collecting measures 

and submitting data to the JCAHO on a 

quarterly basis. Of the JCAHO 

accredited hospitals, approximately 

3,300 are collecting the same measures 

CMS will be collecting for public 

reporting. Therefore, there will be no 

additional burden for these hospitals. 

Only approximately 300 of the JCAHO 

accredited hospitals will need to collect 

an additional topic in addition to the 

data already collected for maintaining 

JCAHO accreditation. In addition, there 

are approximately 400 hospitals that do 

not participate in the JCAHO 

accreditation process. These hospitals 

will have the additional burden of 

collecting data on all three topics. 

For JCAHO accredited hospitals that 

are not already collecting all of the 

required measures, we estimate it will 

take 25 hours per month per topic for 

collection. We expect the burden for all 

of these hospitals to total 102,000 hours 

per year, including time allotted for 

overhead. For non-JCAHO accredited 

hospitals, we estimate the burden to be 

136,000 hours per year. This estimate 

also includes overhead. The total 

number of burden hours for all hospitals 

combined is 238,000. The number of 

responders will vary according to the 

level of voluntary participation. One 

hundred percent of the data may be 

collected electronically. 

In the preamble to this proposed rule, 

we are proposing additional validation 

criteria to ensure that the quality data 

being sent to CMS are accurate. Our 

validation process requires participating 

hospitals to submit five charts per 

quarter. The burden associated with this 

requirement is the time and effort 

associated with collecting, copying, and 

submitting these charts. It will take 

approximately 2 hours per hospital to 

submit the 5 charts per quarter. There 

will be a total of approximately 19,000 

charts (3,800 hospitals × charts per 

hospital) submitted by the hospitals to 

CMS per quarter for a total burden of 

7,600 hours per quarter and a total 

annual burden of 30,400 hours. 

Section 413.65 Requirements for a 

Determination That a Facility or an 

Organization Has Provider-Based Status 

Proposed § 413.65(b)(3)(i) requires 

potential main providers seeking a 

determination of provider-based status 

for a facility that is located on the 

campus of the potential main provider 

to submit an attestation stating that the 

facility meets the criteria in paragraph 

(d) of § 413.65 and, if it is a hospital, to 

also attest that it will fulfill the 

obligations of hospital outpatient 

departments and hospital-based entities 

described in paragraph (g) of § 413.65. 

We are also proposing to amend this 

paragraph to require that in the case of 

a facility that is operated as a joint 

venture, the potential main provider 

attest that it will comply with the 

requirements of paragraph (f) of 

§ 413.65. 

Proposed § 413.65(b)(3)(ii) provides 

that, if a facility is not located on the 

campus of the potential main provider, 

the potential main provider must submit 

an attestation stating that the facility 

meets the criteria in paragraph (d) and 

(e) of § 413.65 and, if it is a hospital, to 

also attest that it will fulfill the 

obligations of hospital outpatient 

departments and hospital-based entities 

described in paragraph (g) of § 413.65. If 

the facility is operated under a 

management contract, the potential 

main provider also attest that the facility 

meets the requirements of paragraph (h) 

of § 413.65. 

Proposed § 413.65(e)(3) requires that a 

facility or organization for which 

provider-based status is sought that is 

not located on the campus of a potential 

main provider must (i) be located within 

a 35-mile radius of the campus of the 

hospital or CAH that is the potential 

main provider, or (ii) be owned and 

operated by a hospital or CAH that has 

a disproportionate share adjustment (as 

determined under § 412.106 of this 

chapter) greater than 11.75 percent and 

is described in § 412.106(c)(2) of this 

chapter implementing section 

1886(e)(5)(F)(i)(II) of the Act and is (A) 

owned or operated by a unit of State or 

local government, (B) a public or 

nonprofit corporation formally granted 

governmental powers by a unit of State 

or local government; or (C) a private 

hospital having a contract with a State 

or local government that includes the 

operation of clinics located off the main 

campus of the hospital to assure access 

in a well-defined service area to health 

care services for low-income individuals 

who are not entitled to benefits under 

Medicare (or medical assistance under a 

Medicaid State plan), or (iii) 

demonstrate a high level of integration 

23460 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

with the main provider by showing that 

it meets all of the other provider-based 

criteria and demonstrate that it serves 

the same patient population as the main 

provider, by submitting certain records 

showing the information contained in 

paragraphs (e)(3)(iii)(A) and (e)(3)(iii)(B) 

of this section or (iv) if the facility or 

organization is unable to meet the 

criteria in paragraph (e)(3)(iii)(A) or 

paragraph (e)(3)(iii)(B) because it was 

not in operation during all of the 12- 

month period described in paragraph 

(e)(3)(iii), be located in a zip code area 

included among those that, during all of 

the 12-month period described in 

paragraph (e)(3)(iii), accounted for at 

least 75 percent of the patients served 

by the main provider, or (v) in the case 

of an RHC, (A) be an RHC that is 

otherwise qualified as a provider-based 

entity of a hospital that has fewer than 

50 beds, and (B) the hospital with which 

the facility or organization has a 

provider-based relationship be located 

in a rural area, and (vi) be located in the 

same State as the main provider or, 

when consistent with the laws of both 

States, in adjacent States. 

Section 413.65(g)(7) provides that 

when a Medicare beneficiary is treated 

in a hospital outpatient department that 

is not located on the main provider’s 

campus, the treatment is not required to 

be provided by the antidumping rules of 

section 489.24, and the beneficiary will 

incur a coinsurance liability for an 

outpatient visit to the hospital, as well 

as for the physician service the hospital 

must provide written notice to the 

beneficiary, before delivery of services 

of the amount of the beneficiary’s 

potential financial liability. If the exact 

type and extent of care is not known, 

the hospital must provide written notice 

to the beneficiary that explains that the 

beneficiary will incur a coinsurance 

liability to the hospital that he or she 

would not incur if the facility were not 

provider-based, an estimate based on 

typical or average charges for visits to 

the facility, and a statement that the 

patient’s actual liability will depend 

upon the actual services furnished by 

the hospital. 

While the information collection 

requirements contained in this section 

are subject to the PRA, the burden 

associated with this requirement is 

currently approved under OMB 

approval no. 0938–0798. 

Section 485.610 Condition of 

Participation: Status and Location 

In order to be considered a relocation, 

we are proposing under 

§ 485.610(d)(2)(ii) to require a CAH to 

provide documentation demonstrating 

that its plans to rebuild in a relocated 

area were undertaken prior to December 

8, 2003. This requirement does impose 

an information collection requirement. 

However, because this burden would be 

imposed on less than 10 CAHs, under 5 

CFR 1320.2(c), these requirements are 

exempt from the PRA. 

We have submitted a copy of this 

proposed rule to OMB for its review of 

the information collection requirements 

described above. 

If you have any comments on the 

information collection and 

recordkeeping requirements, please mail 

the copies directly to the following: 

Centers for Medicare & Medicaid 

Services, Office of Strategic 

Operations and Regulatory Affairs, 

Security and Standards Group, 

Regulations Development and 

Issuances Group, Room C4–24–02, 

7500 Security Boulevard, Baltimore, 

MD 21244–1850, Attn.: James 

Wickliffe, CMS–1500–P. 

Office of Information and Regulatory 

Affairs, Office of Management and 

Budget, Room 3001, New Executive 

Office Building, Washington, DC 

20503, Attn: Christopher Martin, CMS 

Desk Officer. 

Comments submitted to OMB may 

also be e-mailed to the following 

address: 

Christopher_Martin@omb.eop.gov; or 

faxed to OMB at (202) 395–6974 or (202) 

395–5167. Attn.: CMS–1500–P. 

C. Public Comments 

Because of the large number of items 

of correspondence we normally receive 

on a proposed rule, we are not able to 

acknowledge or respond to them 

individually. However, in preparing the 

final rule, we will consider all 

comments concerning the provisions of 

this proposed rule that we receive by 

the date and time specified in the DATES

section of this preamble and respond to 

those comments in the preamble to that 

rule. We emphasize that section 

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

rule for FY 2006 to be published by 

August 1, 2005, and we will consider 

only those comments that deal 

specifically with the matters discussed 

in this proposed rule. 

List of Subjects 

42 CFR Part 405 

Administrative practice and 

procedure, Health facilities, Health 

professions, Kidney diseases, Medicare, 

Reporting and recordkeeping 

requirements, Rural area, X-rays. 

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 415 

Health facilities, Health professions, 

Medicare, and reporting and 

recordkeeping requirements. 

42 CFR Part 419 

Hospitals, Medicare, Reporting and 

recordkeeping requirements. 

42 CFR Part 422 

Health maintenance organizations 

(HMO), Medicare+Choice, Provider 

sponsored organizations (PSO). 

42 CFR Part 485 

Grant programs-health, Health 

facilities, Medicaid, Medicare, 

Reporting and recordkeeping 

requirements. 

For the reasons stated in the preamble 

of this proposed rule, the Centers for 

Medicare & Medicaid Services is 

proposing to amend 42 CFR chapter IV 

as follows: 

PART 405—FEDERAL HEALTH 

INSURANCE FOR THE AGED AND 

DISABLED 

A. Part 405 is amended as follows: 

1. The authority citation for Part 405 

continues to read as follows: 

Authority: Secs. 1102, 1861, 1862(a), 1871, 

1874, 1881, and 1886(k) of the Social 

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

1395y(a), 1395hh, 1395kk, 1395rr, and 

1395ww(k)), and sec. 353 of the Public 

Health Service Act (42 U.S.C. 263a). 

§ 405.2468 [Amended] 

2. In § 405.2468(f)(1), the reference 

‘‘§ 413.86(b)’’ is removed and the 

reference ‘‘§ 413.75(b)’’ is added in its 

place. 

PART 412—PROSPECTIVE PAYMENT 

SYSTEMS FOR INPATIENT HOSPITAL 

SERVICES 

B. Part 412 is amended as follows: 

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). 

§ 412.1 [Amended] 

2. In § 412.1(a)(1), the reference 

‘‘§ 413.86’’ is removed and the reference 

‘‘§§ 413.75 through 413.83’’ is added in 

its place. 

§ 412.2 [Amended] 

3. In § 412.2—

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23461 

a. In paragraph (f)(7), remove the 

reference ‘‘§ 413.86’’ and add in its place 

the reference ‘‘§§ 413.75 through 

413.83’’. 

b. At the end of paragraph (f)(8), add 

the following sentence: ‘‘For discharges 

occurring on or after October 1, 2005, 

the additional payment is made based 

on the average sales price methodology 

specified in Subpart K, Part 414 of this 

subchapter and the furnishing fee 

specified in § 410.63 of this 

subchapter.’’

4. Section 412.64 is amended by 

revising paragraph (k)(2) to read as 

follows: 

§ 412.64 Federal rates for inpatient 

operating costs for Federal fiscal year 2005 

and subsequent fiscal years. 

* * * * * 

(k) Midyear corrections to the wage 

index. 

* * * * * 

(2)(i) Except as provided in paragraph 

(k)(2)(ii) of this section, a midyear 

correction to the wage index is effective 

prospectively from the date the change 

is made to the wage index. 

(ii) Effective October 1, 2005, a change 

to the wage index may be made 

retroactively to the beginning of the 

Federal fiscal year, if, for the fiscal year 

in question, CMS determines all of the 

following—

(A) The fiscal intermediary or CMS 

made an error in tabulating data used 

for the wage index calculation; 

(B) The hospital knew about the error 

in its wage data and requested the fiscal 

intermediary and CMS to correct the 

error both within the established 

schedule for requesting corrections to 

the wage data (which is at least before 

the beginning of the fiscal year for the 

applicable update to the hospital 

inpatient prospective payment system) 

and using the established process; and 

(C) CMS agreed before October 1 that 

the fiscal intermediary or CMS made an 

error in tabulating the hospital’s wage 

data and the wage index should be 

corrected. 

* * * * * 

5. Section 412.73 is amended by 

adding a new paragraph (f) to read as 

follows: 

§ 412.73 Determination of the hospitalspecific rate based on a Federal fiscal year 

1982 base period. 

* * * * * 

(f) Maintaining budget neutrality. 

CMS makes an adjustment to the 

hospital-specific rate to ensure that 

changes to the DRG classifications and 

recalibrations of the DRG relative 

weights are made in a manner so that 

aggregate payments to section 1886(d) 

hospitals are not affected. 

6. Section 412.75 is amended by 

adding a new paragraph (i) to read as 

follows: 

§ 412.75 Determination of the hospitalspecific rate for inpatient operating costs 

based on a Federal fiscal year 1987 base 

period. 

* * * * * 

(i) Maintaining budget neutrality. 

CMS makes an adjustment to the 

hospital-specific rate to ensure that 

changes to the DRG classifications and 

recalibrations of the DRG relative 

weights are made in a manner so that 

aggregate payments to section 1886(d) 

hospitals are not affected. 

7. Section 412.77 is amended by—

a. Revising paragraph (a)(1). 

b. Adding a new paragraph (j). 

The revision and addition read as 

follows: 

§ 412.77 Determination of the hospitalspecific rate for inpatient operating costs 

for sole community hospitals based on a 

Federal fiscal year 1996 base period. 

(a) Applicability. (1) This section 

applies to a hospital that has been 

designated as a sole community 

hospital, as described in § 412.92. If the 

1996 hospital-specific rate exceeds the 

rate that would otherwise apply, that is, 

either the Federal rate under § 412.64 

(or under § 412.63 for periods prior to 

FY 2005) or the hospital-specific rates 

for either FY 1982 under § 412.73 or FY 

1987 under § 412.75, this 1996 rate will 

be used in the payment formula set forth 

in § 412.92(d)(1). 

* * * * * 

(j) Maintaining budget neutrality. 

CMS makes an adjustment to the 

hospital-specific rate to ensure that 

changes to the DRG classifications and 

recalibrations of the DRG relative 

weights are made in a manner so that 

aggregate payments to section 1886(d) 

hospitals are not affected. 

8. Section 412.90 is amended by 

revising paragraph (e)(1) to read as 

follows: 

§ 412.90 General rules. 

* * * * * 

(e) Hospitals located in areas that are 

reclassified from urban to rural. (1) CMS 

adjusts the rural Federal payment 

amounts for inpatient operating costs for 

hospitals located in geographic areas 

that are reclassified from urban to rural 

as defined in subpart D of this part. This 

adjustment is set forth in § 412.102. 

* * * * * 

9. Section 412.92 is amended by—

a. In paragraph (a) introductory text, 

removing the reference ‘‘§ 412.83(b)’’

and adding in its place the reference 

‘‘§ 412.64’’. 

b. Revising paragraph (d)(1)(i). 

c. Revising paragraph (d)(3). 

The revisions and addition read as 

follows: 

§ 412.92 Special treatment: Sole 

community hospitals. 

* * * * * 

(d) Determining prospective payment 

rates for inpatient operating costs for 

sole community hospitals. (1) * * * 

(i) The Federal payment rate 

applicable to the hospitals as 

determined under subpart D of this part. 

* * * * * 

(3) Adjustment to payments. A sole 

community hospital may receive an 

adjustment to its payments to take into 

account a significant decrease in the 

number of discharges, as described in 

paragraph (e) of this section. 

* * * * * 

10. Section 412.96 is amended by—

a. Revising paragraph (b)(1) 

introductory text. 

b. Revising paragraph (c) introductory 

text. 

c. In paragraph (c)(1) introductory 

text, removing the reference ‘‘paragraph 

(g)’’ and adding in its place the 

reference ‘‘paragraph (h)’’. 

d. In paragraph (c)(2)(i), removing the 

reference ‘‘paragraph (h)’’ and adding in 

its place the reference ‘‘paragraph (i)’’. 

e. Revising paragraph (g)(1). 

f. In the introductory text of paragraph 

(h), removing the phrase ‘‘paragraphs 

(g)(1) through (g)(4)’’ and adding in its 

place the phrase ‘‘paragraphs (h)(1) 

through (h)(4)’’. 

g. In paragraph (h)(2), removing the 

reference ‘‘(g)(1)’’ and adding in its place 

the reference ‘‘(h)(1)’’. 

h. Removing paragraph (h)(4). 

i. In paragraph (i)(2), removing the 

reference ‘‘(h)(1)’’ and adding in its 

place the reference ‘‘(i)(1)’’. 

j. Removing paragraph (i)(4). 

The revisions read as follows: 

§ 412.96 Special treatment: Referral 

centers. 

* * * * * 

(b) Criteria for cost reporting periods 

beginning on or after October 1, 

1983.* * * 

(1) The hospital is located in a rural 

area (as defined in subpart D of this 

part) and has the following number of 

beds, as determined under the 

provisions of § 412.105(b) available for 

use: 

* * * * * 

(c) Alternative criteria. For cost 

reporting periods beginning on or after 

October 1, 1985, a hospital that does not 

meet the criteria of paragraph (b) of this 

section is classified as a referral center 

if it is located in a rural area (as defined 

23462 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

in subpart D of this part) and meets the 

criteria specified in paragraphs (c)(1) 

and (c)(2) of this section and at least one 

of the three criteria specified in 

paragraphs (c)(3), (c)(4), and (c)(5) of 

this section. 

* * * * * 

(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 subpart D of this part. 

* * * * * 

11. Section 412.103 is amended by 

revising paragraphs (a)(1) and (a)(4) to 

read as follows: 

§ 412.103 Special treatment: Hospitals 

located in urban areas and that apply for 

reclassification as rural. 

(a) * * * 

(1) The hospital is located in a rural 

census tract of a Metropolitan Statistical 

Area (MSA) as determined under the 

most recent version of the Goldsmith 

Modification, the Rural-Urban 

Commuting Area codes, as determined 

by the Office of Rural Health Policy 

(ORHP) of the Health Resources and 

Services Administration, which is 

available via the ORHP Web site at: 

http://www.ruralhealth.hrsa.gov or from 

the U.S. Department of Health and 

Human Services, Health Resources and 

Services Administration, Office of Rural 

Health Policy, 5600 Fishers Lane, Room 

9A–55, Rockville, MD 20857. 

* * * * * 

(4) For any period after September 30, 

2004 and before October 1, 2006, a CAH 

in a county that, in FY 2004, was not 

part of an MSA as defined by the Office 

of Management and Budget and was not 

considered to be urban under 

§ 412.64(b)(3) of this chapter, but as of 

FY 2005 was included as part of an 

MSA or was considered to be urban 

under § 412.64(b)(3) of this chapter as a 

result of the most recent census data 

and implementation of the new MSA 

definitions announced by OMB on June 

6, 2003, may be reclassified as being 

located in a rural area for purposes of 

meeting the rural location requirement 

under § 485.610(b) of this chapter if it 

meets any of the requirements in 

paragraphs (a)(1), (a)(2), or (a)(3) of this 

section. 

* * * * * 

12. Section 412.105 is amended by—

a. Adding a new paragraph 

(f)(1)(iv)(D). 

b. Adding a new paragraph (f)(1)(xiii). 

c. Adding a new paragraph (f)(1)(xiv). 

The additions read as follows: 

§ 412.105 Special treatment: Hospitals that 

incur indirect costs for graduate medical 

education programs. 

* * * * * 

(f) Determining the total number of 

full-time equivalent residents for cost 

reporting periods beginning on or after 

July 1, 1991. (1) * * * 

(iv) * * * 

(D) A rural hospital redesignated as 

urban after September 30, 2004, as a 

result of the most recent census data 

and implementation of the new labor 

market area definitions announced by 

OMB on June 6, 2003, may retain the 

increases to its full-time equivalent 

resident cap that it received under 

paragraphs (f)(1)(iv)(A) and (f)(1)(vii) of 

this section while it was located in a 

rural area. 

* * * * * 

(xiii) For a hospital that was excluded 

from the hospital inpatient prospective 

payment system under Part 413 of this 

chapter and that subsequently changed 

to a hospital subject to the hospital 

inpatient prospective payment system 

for cost reporting periods ending on or 

before December 31, 1996, the total 

number of full-time equivalent residents 

for payment purposes is determined in 

accordance with the provisions of this 

paragraph (f). In the case of a merger of 

two or more hospitals, for purposes of 

this paragraph, the surviving hospital’s 

number of full-time equivalent residents 

for payment purposes is equal to the 

aggregate number of the full-time 

equivalent resident count of each of the 

merged hospitals as determined in 

accordance with the provisions of this 

paragraph (f). 

(xiv) Effective for discharges 

occurring on or after October 1, 2005, an 

urban hospital that reclassifies to a rural 

area under § 412.103 and then 

subsequently elects to revert back to 

urban classification will not be allowed 

to retain the adjustment to its IME FTE 

resident cap that it received as a result 

of being reclassified as rural. 

* * * * * 

13. Section 412.108 is amended by 

revising paragraph (c)(1) to read as 

follows: 

§ 412.108 Special treatment: Medicaredependent, small rural hospitals. 

* * * * * 

(c) Payment methodology. * * * 

(1) The Federal payment rate 

applicable to the hospital, as 

determined under subpart D of this part, 

subject to the regional floor defined in 

§ 412.70(c)(6). 

* * * * * 

14. Section 412.109 is amended by 

revising paragraph (b)(2) to read as 

follows: 

§ 412.109 Special treatment: Essential 

access community hospitals (EACHs). 

* * * * * 

(b) Location in a rural area. * * * 

(2) Is not deemed to be located in an 

urban area under subpart D of this part. 

* * * * * 

§ 412.113 [Amended] 

15. In § 412.113—

a. In paragraph (b)(2), the reference 

‘‘§ 413.86 of this chapter.’’ is removed 

and the reference ‘‘§§ 413.75 through 

413.83 of this subchapter.’’ is added in 

its place. 

b. In paragraph (b)(3), the reference 

‘‘§ 413.86(c) of this chapter,’’ is removed 

and the reference ‘‘§ 413.75(c) of this 

subchapter,’’ is added in its place. 

§ 412.115 [Amended] 

16. In § 412.115—

a. In paragraph (a), the reference 

‘‘§ 413.80’’ is removed and the reference 

‘‘§ 413.89’’ is added in its place. 

b. At the end of paragraph (b), add the 

following sentence: ‘‘For discharges 

occurring on or after October 1, 2005, 

the additional payment is made based 

on the average sales price methodology 

specified in subpart K, part 414 of this 

chapter and the furnishing fee specified 

in § 410.63 of this subchapter.’’

17. Section 412.230 is amended by—

a. Redesignating paragraph (d)(2)(iii) 

as paragraph (d)(2)(v). 

b. Adding new paragraphs (d)(2)(iii) 

and (d)(2)(iv). 

The additions read as follows: 

§ 412.230 Criteria for an individual hospital 

seeking redesignation to another rural area 

or an urban area. 

* * * * * 

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

wage index.—* * * 

(2) Appropriate wage data. * * * 

(iii) For applications submitted for 

reclassifications effective in FY 2006, a 

campus of a multicampus hospital 

system may seek reclassification to 

another CBSA. As part of its 

reclassification request, the requesting 

entity may submit the composite wage 

data for the entire multicampus hospital 

system as its hospital-specific data. 

(iv) For applications submitted for 

reclassifications effective in FY 2007 

and subsequent years, a campus of a 

multicampus hospital system may seek 

reclassification to another CBSA. As 

part of its reclassification request, the 

requesting entity must submit campusspecific wage data for purposes of the 

wage index comparison. 

* * * * * 

18. Section 412.234 is amended by—

a. In paragraph (a)(3)(ii), removing the 

phrase ‘‘fiscal years 2006 and thereafter’’

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23463 

and adding in its place the phrase ‘‘fiscal 

year 2006’’. 

b. Adding a new paragraph (a)(3)(iii). 

c. In paragraph (b)(1), removing the 

phrase ‘‘or NECMA’’. 

The addition reads as follows: 

§ 412.234 Criteria for all hospitals in an 

urban county seeking redesignation to 

another urban area. 

(a) * * * 

(3) * * * 

(iii) For Federal fiscal year 2007 and 

thereafter, hospitals located in counties 

that are in the same Consolidated 

Statistical Area (CSA) (under the MSA 

definitions announced by the OMB on 

June 6, 2003) as the urban area to which 

they seek redesignation qualify as 

meeting the proximity requirement for 

reclassification to the urban area to 

which they seek redesignation. 

* * * * * 

§ 412.278 [Amended] 

19. In § 412.278(b)(1), the phrase 

‘‘Office of Payment Policy’’ is removed 

and the phrase ‘‘Hospital and 

Ambulatory Policy Group’’ is added in 

its place. 

20. Section 412.304 is amended by 

revising paragraph (a) to read as follows: 

§ 412.304 Implementation of the capital 

prospective payment system. 

(a) General rule. As described in 

§§ 412.312 through 412.370, effective 

with cost reporting periods beginning 

on or after October 1, 1991, CMS pays 

an amount determined under the capital 

prospective payment system for each 

inpatient hospital discharge as defined 

in § 412.4. This amount is in addition to 

the amount payable under the 

prospective payment system for 

inpatient hospital operating costs as 

determined under subpart D of this part. 

* * * * * 

§ 412.521 [Amended] 

21. In § 412.521—

a. Under paragraph (b)(2)(i), the 

reference ‘‘§§ 413.85, 413.86, and 413.87 

of this subchapter.’’ is removed and the 

reference ‘‘§§ 413.75 through 413.83, 

413.85, and 413.87 of this subchapter.’’

is added in its place. 

b. Under paragraph (b)(2)(ii), the 

reference ‘‘§ 413.80’’ is removed and the 

reference ‘‘§ 413.89’’ is added in its 

place. 

PART 413—PRINCIPLES OF 

REASONABLE COST 

REIMBURSEMENT; PAYMENT FOR 

END-STAGE RENAL DISEASE 

SERVICES; PROSPECTIVELY 

DETERMINED PAYMENT RATES FOR 

SKILLED NURSING FACILITIES 

C. Part 413 is amended as follows: 

1. The authority citation for Part 413 

continued to read as follows: 

Authority: Secs. 1102, 1812(d), 1814(b), 

1815, 1833(a), (i), and (n), 1871, 1881, 1883, 

and 1886 of the Social Security Act (42 

U.S.C. 1302, 1395d(d), 1395f(b), 1395g, 

1395l(a), (i), and (n), 1395hh, 1395rr, 1395tt, 

and 1395ww). 

§ 413.13 [Amended] 

2. In § 413.13 (d)(1), the reference 

‘‘§ 413.80’’ is removed and the reference 

‘‘§ 413.89’’ is added in its place. 

3. Section 413.40 is amended by—

a. In paragraph(a)(3), under the 

definition of ‘‘Net inpatient operating 

costs’’, removing the reference 

‘‘§§ 413.85 and 413.86’’ and adding in its 

place the reference ‘‘§§ 413.75 through 

413.83 and 413.85’’. 

b. Revising paragraph (c)(4)(iii). 

§ 413.40 Ceiling on the rate of increase in 

hospital inpatient costs. 

* * * * * 

(c) Costs subject to the ceiling—* * * 

(4) Target amounts. * * * 

(iii) For cost reporting periods 

beginning on or after October 1, 1997 

through September 30, 2002, in the case 

of a psychiatric hospital or unit, 

rehabilitation hospital or unit, or longterm care hospital, the target amount is 

the lower of the amounts specified in 

paragraph (c)(4)(iii)(A) or paragraph 

(c)(4)(iii)(B) of this section. 

* * * * * 

4. Section 413.65 is amended by—

a. Reprinting the introductory text of 

paragraph (a)(1)(ii) and adding a new 

paragraph (a)(1)(ii)(L). 

b. Revising the definition of 

‘‘Provider-based entity’’ under paragraph 

(a)(2). 

c. Revising paragraphs (b)(3)(i) and 

(b)(3)(ii). 

d. Revising paragraphs (e)(1) 

introductory text and (e)(1)(i). 

e. Revising paragraph (e)(3). 

f. Revising paragraph (g)(7). 

The addition and revision read as 

follows: 

§ 413.65 Requirements for a determination 

that a facility or an organization has 

provider-based status. 

(a) Scope and definitions. * * * 

(1) * * * 

(ii) The determinations of providerbased status for payment purposes 

described in this section are not made 

as to whether the following facilities are 

provider-based: 

* * * * * 

(L) Rural health clinics (RHCs) 

affiliated with hospitals having 50 or 

more beds. 

* * * * * 

(2) Definitions. * * * 

Provider-based entity means a 

provider of health care services, or an 

RHC as defined in § 405.2401(b) of this 

chapter, that is either created by, or 

acquired by, a main provider for the 

purpose of furnishing health care 

services of a different type from those of 

the main provider under the ownership 

and administrative and financial control 

of the main provider, in accordance 

with the provisions of this section. A 

provider-based entity comprises both 

the specific physical facility that serves 

as the site of services of a type for which 

payment could be claimed under the 

Medicare or Medicaid program, and the 

personnel and equipment needed to 

deliver the services at that facility. A 

provider-based entity may, by itself, be 

qualified to participate in Medicare as a 

provider under § 489.2 of this chapter, 

and the Medicare conditions of 

participation do apply to a providerbased entity as an independent entity. 

* * * * * 

(b) Provider-based determinations.—

* * * 

(3)(i) Except as specified in 

paragraphs (b)(2) and (b)(5) of this 

section, if a potential main provider 

seeks a determination of provider-based 

status for a facility that is located on the 

campus of the potential main provider, 

the provider would be required to 

submit an attestation stating that the 

facility meets the criteria in paragraph 

(d) of this section and, if it is a hospital, 

also attest that it will fulfill the 

obligations of hospital outpatient 

departments and hospital-based entities 

described in paragraph (g) of this 

section. The provider seeking such a 

determination would also be required to 

maintain documentation of the basis for 

its attestations and to make that 

documentation available to CMS and to 

CMS contractors upon request. If the 

facility is operated as a joint venture, 

the provider would also have to attest 

that it will comply with the 

requirements of paragraph (f) of this 

section. 

(ii) If the facility is not located on the 

campus of the potential main provider, 

the provider seeking a determination 

would be required to submit an 

attestation stating that the facility meets 

the criteria in paragraphs (d) and (e) of 

this section, and if the facility is 

operated under a management contract, 

the requirements of paragraph (h) of this 

section. If the potential main provider is 

a hospital, the hospital also would be 

required to attest that it will fulfill the 

obligations of hospital outpatient 

departments and hospital-based entities 

described in paragraph (g) of this 

section. The provider would be required 

23464 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

to supply documentation of the basis for 

its attestations to CMS at the time it 

submits its attestations. 

* * * * * 

(e) * * * 

(1) Operation under the ownership 

and control of the main provider. The 

facility or organization seeking 

provider-based status is operated under 

the ownership and control of the main 

provider, as evidenced by the following: 

(i) The business enterprise that 

constitutes the facility or organization is 

100 percent owned by the main 

provider. 

* * * * * 

(3) Location. The facility or 

organization meets the requirements in 

paragraph (e)(3)(i), (e)(3)(ii), (e)(3)(iii), 

(e)(3)(iv), or, in the case of an RHC, 

paragraph (e)(3)(v) of this section, and 

the requirements in paragraph (e)(3)(vi) 

of this section. 

(i) The facility or organization is 

located within a 35-mile radius of the 

campus of the hospital or CAH that is 

the potential main provider. 

(ii) The facility or organization is 

owned and operated by a hospital or 

CAH that has a disproportionate share 

adjustment (as determined under 

§ 412.106 of this chapter) greater than 

11.75 percent and is described in 

§ 412.106(c)(2) of this chapter 

implementing section 1886(e)(5)(F)(i)(II) 

of the Act and is—

(A) Owned or operated by a unit of 

State or local government; 

(B) A public or nonprofit corporation 

that is formally granted governmental 

powers by a unit of State or local 

government; or 

(C) A private hospital that has a 

contract with a State or local 

government that includes the operation 

of clinics located off the main campus 

of the hospital to assure access in a 

well-defined service area to health care 

services for low-income individuals 

who are not entitled to benefits under 

Medicare (or medical assistance under a 

Medicaid State plan). 

(iii) The facility or organization 

demonstrates a high level of integration 

with the main provider by showing that 

it meets all of the other provider-based 

criteria and demonstrates that it serves 

the same patient population as the main 

provider, by submitting records showing 

that, during the 12-month period 

immediately preceding the first day of 

the month in which the application for 

provider-based status is filed with CMS, 

and for each subsequent 12-month 

period—

(A) At least 75 percent of the patients 

served by the facility or organization 

reside in the same zip code areas as at 

least 75 percent of the patients served 

by the main provider; or 

(B) At least 75 percent of the patients 

served by the facility or organization 

who required the type of care furnished 

by the main provider received that care 

from that provider (for example, at least 

75 percent of the patients of an RHC 

seeking provider-based status received 

inpatient hospital services from the 

hospital that is the main provider). 

(iv) If the facility or organization is 

unable to meet the criteria in paragraph 

(e)(3)(iii)(A) or paragraph (e)(3)(iii)(B) of 

this section because it was not in 

operation during all of the 12-month 

period described in paragraph (e)(3)(iii) 

of this section, the facility or 

organization is located in a zip code 

area included among those that, during 

all of the 12-month period described in 

paragraph (e)(3)(iii) of this section, 

accounted for at least 75 percent of the 

patients served by the main provider. 

(v) Both of the following criteria are 

met: 

(A) The facility or organization is an 

RHC that is otherwise qualified as a 

provider-based entity of a hospital that 

has fewer than 50 beds, as determined 

under § 412.105(b) of this chapter; and 

(B) The hospital with which the 

facility or organization has a providerbased relationship is located in a rural 

area, as defined in Subpart D of Part 412 

of this subchapter. 

(vi) A facility or organization may 

qualify for provider-based status under 

this section only if the facility or 

organization and the main provider are 

located in the same State or, when 

consistent with the laws of both States, 

in adjacent States. 

* * * * * 

(g) Obligations. * * * 

(7) When a Medicare beneficiary is 

treated in a hospital outpatient 

department that is not located on the 

main provider’s campus, the treatment 

is not required to be provided by the 

antidumping rules in § 489.24 of this 

chapter, and the beneficiary will incur 

a coinsurance liability for an outpatient 

visit to the hospital as well as for the 

physician service, the following 

requirements must be met: 

(i) The hospital must provide written 

notice to the beneficiary, before the 

delivery of services, of—

(A) The amount of the beneficiary’s 

potential financial liability; or 

(B) If the exact type and extent of care 

needed are not known, an explanation 

that the beneficiary will incur a 

coinsurance liability to the hospital that 

he or she would not incur if the facility 

were not provider-based, an estimate 

based on typical or average charges for 

visits to the facility, and a statement that 

the patient’s actual liability will depend 

upon the actual services furnished by 

the hospital. 

(ii) The notice must be one that the 

beneficiary can read and understand. 

(iii) If the beneficiary is unconscious, 

under great duress, or for any other 

reason unable to read a written notice 

and understand and act on his or her 

own rights, the notice must be provided, 

before the delivery of services, to the 

beneficiary’s authorized representative. 

(iv) In cases where a hospital 

outpatient department provides 

examination or treatment that is 

required to be provided by the 

antidumping rules of § 489.24 of this 

chapter, notice, as described in this 

paragraph (g)(7), must be given as soon 

as possible after the existence of an 

emergency has been ruled out or the 

emergency condition has been 

stabilized. 

* * * * * 

5. Section 413.75 is amended in 

paragraph (b) by revising paragraph (1) 

under the definition of ‘‘Medicare GME 

affiliated group’’ to read as follows: 

§ 413.75 Direct GME payments: General 

requirements. 

* * * * * 

(b) * * * 

Medicare GME affiliated group 

means—

(1) Two or more hospitals that are 

located in the same urban or rural area 

(as those terms are defined in subpart D 

of part 412 of this subchapter. 

* * * * * 

§ 413.77 [Amended] 

6. In § 413.77, under paragraph 

(e)(1)(iii), the reference ‘‘§ 412.62(f)(1)(i) 

of this chapter.’’ is removed and the 

reference ‘‘subpart D of part 412 of this 

subchapter’’. is added in its place. 

7. Section 413.79 is amended by—

a. Revising paragraph (a)(10). 

b. Revising the introductory text of 

paragraph (c)(2). 

c. In paragraph (c)(3)(i), removing the 

reference ‘‘§ 412.62(f)(iii)’’ and adding in 

its place the reference ‘‘subpart D of part 

412 of this subchapter’’. 

d. Adding a new paragraph (c)(6). 

e. Revising paragraph (e)(1)(iv). 

f. In the introductory text of paragraph 

(k), removing the reference ‘‘(k)(6)’’ and 

adding in its place the reference ‘‘(k)(7)’’. 

g. Adding a new paragraph (k)(7). 

The revisions and additions read as 

follows: 

§ 413.79 Direct GME payments: 

Determination of the weighted number of 

FTE residents. 

* * * * * 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23465 

(a) * * * 

(10) Effective for portions of cost 

reporting periods beginning on or after 

October 1, 2004, if a hospital can 

document that a resident 

simultaneously matched for one year of 

training in a particular specialty 

program, and for a subsequent year(s) of 

training in a different specialty program, 

the resident’s initial residency period 

will be determined based on the period 

of board eligibility for the specialty 

associated with the program for which 

the resident matched for the subsequent 

year(s) of training. Effective for cost 

reporting periods beginning on or after 

October 1, 2005, if a hospital can 

document that a particular resident, 

prior to beginning the first year of 

residency training, matched in a 

specialty program for which training 

would begin at the conclusion of the 

first year of training, that resident’s 

initial residency period will be 

determined in the resident’s first year of 

training based on the period of board 

eligibility associated with the specialty 

program for which the resident matched 

for subsequent training year(s). 

* * * * * 

(c) Unweighted FTE counts. * * * 

(2) Determination of the FTE resident 

cap. Subject to the provisions of 

paragraphs (c)(3) through (c)(6) of this 

section and § 413.81, for purposes of 

determining direct GME payment—

* * * * * 

(6) FTE resident caps for rural 

hospitals that are reclassified as urban. 

A rural hospital redesignated as urban 

after September 30, 2004, as a result of 

the most recent census data and 

implementation of the new MSA 

definitions announced by OMB on June 

6, 2003, may retain the increases to its 

FTE resident cap that it received under 

paragraphs (c)(2)(i), (e)(1)(iii), and (e)(3) 

of this section while it was located in a 

rural area. 

* * * * * 

(e) New medical residency training 

programs. * * * 

(1) * * * 

(iv) An urban hospital that qualifies 

for an adjustment to its FTE cap under 

paragraph (e)(1) of this section is 

permitted to be part of a Medicare GME 

affiliated group for purposes of 

establishing an aggregate FTE cap only 

if the adjustment that results from the 

affiliation is an increase to the urban 

hospital’s FTE cap. 

* * * * * 

(k) Residents training in rural track 

programs. * * * 

(7) If an urban hospital had 

established a rural track training 

program under the provisions of this 

paragraph (k) with a hospital located in 

a rural area and that rural area 

subsequently becomes an urban area 

due to the most recent census data and 

implementation of the new labor market 

area definitions announced by OMB on 

June 6, 2003, the urban hospital may 

continue to adjust its FTE resident limit 

in accordance with this paragraph (k) 

for the rural track programs established 

prior to the adoption of such new labor 

market area definitions. In order to 

receive an adjustment to its FTE 

resident cap for a new rural track 

residency program, the urban hospital 

must establish a rural track program 

with hospitals that are designated rural 

based on the most recent geographical 

location designations adopted by CMS. 

* * * * * 

§ 413.87 [Amended] 

8. In § 413.87(d) introductory text, the 

reference ‘‘§ 413.86(d)(4)’’ is removed 

and the reference ‘‘§ 413.76(d)(4)’’ is 

added in its place. 

§ 413.178 [Amended] 

9. In § 413.178—

a. In paragraph (a), the reference 

‘‘§ 413.80(b)’’ is removed and the 

reference ‘‘§ 413.89(b)’’ is added in its 

place. 

b. In paragraph (b), the reference 

‘‘§ 413.80’’ is removed and the reference 

‘‘§ 413.89’’ is added in its place. 

PART 415—SERVICES FURNISHED BY 

PHYSICIANS IN PROVIDERS, 

SUPERVISING PHYSICIANS IN 

TEACHING SETTINGS, AND 

RESIDENTS IN CERTAIN SETTINGS 

D. Part 415 is amended as follows: 

1. The authority citation for part 415 

continued to read as follows: 

Authority: Secs. 1102 and 1871 of the 

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

1395hh). 

§ 415.55 [Amended] 

2. In § 415.55(a)(5), the reference 

‘‘§ 413.86’’ is removed and the reference 

‘‘§§ 413.75 through 413.83’’ is added in 

its place. 

§ 415.70 [Amended] 

3. In § 415.70(a)(2), the reference 

‘‘§ 413.86’’ is removed and the reference 

‘‘§§ 413.75 through 413.83’’ is added in 

its place. 

§ 415.102 [Amended] 

4. In § 415.102(c)(1), the reference 

‘‘§ 413.86’’ is removed and the reference 

‘‘§§ 413.75 through 413.83’’ is added in 

its place. 

§ 415.150 [Amended] 

5. In § 415.150(b), the reference 

‘‘§ 413.86’’ is removed and the phrase 

‘‘§§ 413.75 through 413.83’’ is added in 

its place. 

§ 415.152 [Amended] 

6. In § 415.152—

a. In paragraph (2) of the definition of 

‘‘Approved graduate medical education 

(GME) program’’, the reference 

‘‘§ 413.86(b)’’ is removed and the 

reference ‘‘§ 413.75(b)’’ is added in its 

place. 

b. In the definition of ‘‘Teaching 

setting’’, the reference ‘‘§ 413.86,’’ is 

removed and the reference ‘‘§§ 413.75 

through 413.83,’’ is added in its place. 

§ 415.160 [Amended] 

7. In § 415.160—

a. In paragraph (c)(2), the reference 

‘‘§ 413.86’’ is removed and the reference 

‘‘§ 413.78’’ is added in its place. 

b. In paragraph (d)(2), the reference 

‘‘§ 413.86’’ is removed and the reference 

‘‘§§ 413.75 through 413.83’’ is added in 

its place. 

§ 415.174 [Amended] 

8. In § 415.174(a)(1), the reference 

‘‘§ 413.86.’’ is removed and the phrase 

‘‘§§ 413.75 through 413.83.’’ is added in 

its place. 

§ 415.200 [Amended] 

9. In § 415.200(a), the reference 

‘‘§ 413.86’’ is removed and the reference 

‘‘§§ 413.75 through 413.83’’ is added in 

its place. 

§ 415.204 [Amended] 

10. In § 415.204(a)(2), the reference 

‘‘§ 413.86’’ is removed and the reference 

‘‘§§ 413.75 through 413.83’’ is added in 

its place. 

§ 415.206 [Amended] 

11. In § 415.206(a), the reference 

‘‘§ 413.86(f)(1)(iii)’’ is removed and the 

reference ‘‘§ 413.78’’ is added in its 

place. 

§ 415.208 [Amended] 

12. In § 415.208—

a. In paragraph (b)(1), the reference 

‘‘§ 413.86’’ is removed and the reference 

‘‘§§ 413.75 through 413.83’’ is added in 

its place. 

b. In paragraph (b)(4), the reference 

‘‘§ 413.86’’ is removed and the reference 

‘‘§§ 413.75 through 413. 83’’ is added in 

its place. 

PART 419—PROSPECTIVE PAYMENT 

SYSTEM FOR OUTPATIENT 

DEPARTMENT SERVICES 

F. Part 419 is amended as follows: 

1. The authority citation for part 419 

continues to read as follows: 

Authority: Secs. 1102, 1833(t), and 1871 of 

the Social Security Act (42 U.S.C. 1302, 

1395l(t), and 1395hh). 

23466 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

§ 419.2 [Amended] 

2. In § 419.2—

a. In paragraph (c)(1), the reference 

‘‘§ 413.86’’ is removed and the reference 

‘‘§§ 413.75 through 413.83’’ is added in 

its place. 

b. In paragraph (c)(6), the reference 

‘‘§ 413.80(b)’’ is removed and the 

reference ‘‘§ 413.89(b)’’ is added in its 

place. 

PART 422—SPECIAL RULES FOR 

SERVICES FURNISHED BY 

NONCONTRACT PROVIDERS 

G. Part 422 is amended as follows: 

1. The authority citation of part 422 

continues to read as follows: 

Authority: Secs. 1102 and 1871 of the 

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

1395hh). 

§ 422.214 [Amended] 

2. In § 422.214—

a. In paragraph (b), the phrase 

‘‘§§ 412.105(g) and 413.86(d))’’ is 

removed and the phrase ‘‘§§ 412.105(g) 

and 413.76))’’ is added in its place. 

b. In paragraph (b), the phrase 

‘‘Section 413.86 (d)’’ is removed and the 

phrase ‘‘Section 413.76’’ is added in its 

place. 

§ 422.216 [Amended] 

3. In § 422.216(a)(4), the reference 

‘‘§§ 412.105(g) and 413.86(d)’’ is 

removed and the reference 

‘‘§§ 412.105(g) and 413.76’’ is added in 

its place. 

PART 485—CONDITIONS OF 

PARTICIPATION: SPECIALIZED 

PROVIDERS 

G. Part 485 is amended as follows: 

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 

1395(hh)). 

2. Section 485.610 is amended by—

a. In paragraph (b)(1)(i), removing the 

reference ‘‘§ 412.62(f)’’ and adding in its 

place the reference ‘‘§ 412.64(b)’’. 

b. In paragraph (b)(1)(ii), removing the 

reference ‘‘§ 412.63(b)’’ and adding in its 

place the reference ‘‘§ 412.64(b)’’. 

c. Revising paragraph (b)(3). 

d. Adding a new paragraph (d). 

The revisions and additions read as 

follows: 

§ 485.610 Condition of participation: 

Status and location. 

* * * * * 

(b) * * * 

(3) Effective only for October 1, 2004 

through September 30, 2006, the CAH 

does not meet the location requirements 

in either paragraph (b)(1) or paragraph 

(b)(2) of this section and is located in a 

county that, in FY 2004, was not part of 

a Metropolitan Statistical Area as 

defined by the Office of Budget 

Management and was not considered to 

be urban under § 412.63(b)(3) of this 

chapter, but as of FY 2005 was included 

as part of such an MSA or was 

considered to be urban under 

§ 412.64(b)(3) of this chapter, as a result 

of the most recent census data and 

implementation of the new MSA 

definitions announced by OMB on June 

6, 2003. 

* * * * * 

(d) Standard: Relocation of CAHs with 

a necessary provider designation. A 

CAH that has a necessary provider 

certification from the State and places a 

new facility in service after January 1, 

2006, can continue to meet the location 

requirement of paragraph (c) of this 

section based on the necessary provider 

certification only if the new facility 

meets either the requirement for 

replacement in the same location in 

paragraph (d)(1) of this section or the 

requirement for a relocation of a CAH in 

paragraph (d)(2) of this section. 

(1) A new construction of a CAH will 

be considered as a replacement facility 

if the construction is undertaken within 

250 yards of the current building or 

contiguous to the current CAH on land 

owned by the CAH prior to December 8, 

2003. 

(2) A new facility CAH will be 

considered as a relocation of a CAH if, 

at the relocated site—

(i) The CAH serves at least 75 percent 

of the same service area that it served 

prior to its relocation, provides at least 

75 percent of the same services that it 

provided prior to the relocation, and is 

staffed by 75 percent of the same staff 

(including medical staff, contracted 

staff, and employees); and 

(ii) The CAH provides documentation 

demonstrating that its plans to rebuild 

in the relocated area were undertaken 

prior to December 8, 2003. 

(3) If a CAH that has a necessary 

provider certification from the State 

places a new facility in service on or 

after January 1, 2006, and does not meet 

either the requirements in paragraph 

(d)(1) or paragraph (d)(2) of this section, 

the action will be considered a cessation 

of business as described in 

§ 489.52(b)(3). 

(Catalog of Federal Domestic Assistance 

Program No. 93.773, Medicare—Hospital 

Insurance; and Program No. 93.774, 

Medicare—Supplementary Medical 

Insurance Program) 

Dated: April 19, 2005. 

Mark B. McClellan, 

Administrator, Centers for Medicare & 

Medicaid Services. 

Dated: April 22, 2005. 

Michael O. Leavitt, 

Secretary. 

[Editorial Note: The following Addendum 

and appendixes will not appear in the Code 

of Federal Regulations.] 

Addendum—Proposed Schedule of 

Standardized Amount Effective With 

Discharges Occurring On or After 

October 1, 2005 and Update Factors 

and Rate-of-Increase Percentages 

Effective With Cost Reporting Periods 

Beginning On or After October 1, 2005 

(If you choose to comment on issues in this 

section, please include the caption 

‘‘Operating Payment Rates’’ at the beginning 

of your comment.) 

I. Summary and Background 

In this Addendum, we are setting forth the 

proposed amounts and factors for 

determining prospective payment rates for 

Medicare hospital inpatient operating costs 

and Medicare hospital inpatient capitalrelated costs. We are also setting forth the 

proposed rate-of-increase percentages for 

updating the target amounts for hospitals and 

hospital units excluded from the IPPS. 

For discharges occurring on or after 

October 1, 2005, except for SCHs, MDHs, and 

hospitals located in Puerto Rico, each 

hospital’s payment per discharge under the 

IPPS will be based on 100 percent of the 

Federal national rate, which will be based on 

the national adjusted standardized amount. 

This amount reflects the national average 

hospital costs per case from a base year, 

updated for inflation. 

SCHs are paid based on whichever of the 

following rates yields the greatest aggregate 

payment: the Federal national rate; the 

updated hospital-specific rate based on FY 

1982 costs per discharge; the updated 

hospital-specific rate based on FY 1987 costs 

per discharge; or the updated hospitalspecific rate based on FY 1996 costs per 

discharge. 

Under section 1886(d)(5)(G) of the Act, 

MDHs 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 costs per discharge, whichever is 

higher. MDHs do not have the option to use 

their FY 1996 hospital-specific rate. 

For hospitals in Puerto Rico, the payment 

per discharge is based on the sum of 25 

percent of a Puerto Rico rate that reflects base 

year average costs per case of Puerto Rico 

hospitals and 75 percent of the Federal 

national rate. (See section II.D.3. of this 

Addendum for a complete description.) 

As discussed below in section II. of this 

Addendum, we are proposing to make 

changes in the determination of the 

prospective payment rates for Medicare 

inpatient operating costs for FY 2006. The 

proposed changes, to be applied 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23467 

prospectively effective with discharges 

occurring on or after October 1, 2005, affect 

the calculation of the Federal rates. In section 

III. of this Addendum, we discuss our 

proposed changes for determining the 

prospective payment rates for Medicare 

inpatient capital-related costs for FY 2006. 

Section IV. of this Addendum sets forth our 

proposed changes for determining the rate-ofincrease limits for hospitals excluded from 

the IPPS for FY 2006. Section V. of this 

Addendum sets forth policies on payment for 

blood clotting factors administered to 

hemophilia patients. The tables to which we 

refer in the preamble of this proposed rule 

are presented in section VI. of this 

Addendum. 

II. Proposed Changes to Prospective Payment 

Rates for Hospital Inpatient Operating Costs 

for FY 2006 

The basic methodology for determining 

prospective payment rates for hospital 

inpatient operating costs for FY 2005 and 

subsequent fiscal years is set forth at 

§ 412.64. The basic methodology for 

determining the prospective payment rates 

for hospital inpatient operating costs for 

hospitals located in Puerto Rico for FY 2005 

and subsequent fiscal years is set forth at 

§§ 412.211 and 412.212. Below we discuss 

the factors used for determining the 

prospective payment rates. 

In summary, the proposed standardized 

amounts set forth in Tables 1A, 1B, 1C, and 

1D of section VI. of this Addendum reflect—

• Equalization of the standardized 

amounts for urban and other areas at the 

level computed for large urban hospitals 

during FY 2004 and onward, as provided for 

under section 1886(d)(3)(A)(iv) of the Act, 

updated by the applicable percentage 

increase required under sections 

1886(b)(3)(B)(i)(XIX) and 1886(b)(3)(B)(vii) of 

the Act. 

• The two labor-related shares that are 

applicable to the standardized amounts, 

depending on whether the hospital’s 

payments would be higher with a lower (in 

the case of a wage index below 1.0000) or 

higher (in the case of a wage index above 

1.0000) labor share, as provided for under 

sections 1886(d)(3)(E) and 1886(d)(9)(C)(iv) 

of the Act; 

• Updates of 3.2 percent for all areas (that 

is, the full market basket percentage increase 

of 3.2 percent, as required by section 

1886(b)(3)(B)(i)(XIX) of the Act, and 

reflecting the requirements of section 

1886(b)(3)(B)(vii) of the Act to reduce the 

applicable percentage increase by 0.4 

percentage points for hospitals that fail to 

submit data, in a form and manner specified 

by the Secretary, relating to the quality of 

inpatient care furnished by the hospital; 

• An adjustment to ensure the proposed 

DRG recalibration and wage index update 

and changes are budget neutral, as provided 

for under sections 1886(d)(4)(C)(iii) and 

1886(d)(3)(E) of the Act, by applying new 

budget neutrality adjustment factors to the 

standardized amount; 

• An adjustment to ensure the effects of 

the special transition measures adopted in 

relation to the implementation of new labor 

market areas are budget neutral; 

• An adjustment to ensure the effects of 

geographic reclassification are budget 

neutral, as provided for in section 

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

2005 budget neutrality factor and applying a 

revised factor; 

• An adjustment to apply the new outlier 

offset by removing the FY 2005 outlier offset 

and applying a new offset; 

• An adjustment to ensure the effects of 

the rural community hospital demonstration 

required under section 410A of Pub. L. 108–

173 are budget neutral, as required under 

section 410A(c)(2) of Pub. L. 108–173. 

A. Calculation of the Adjusted Standardized 

Amount 

1. Standardization of Base-Year Costs or 

Target Amounts 

The national standardized amount is based 

on per discharge averages of adjusted 

hospital costs from a base period (section 

1886(d)(2)(A) of the Act) or, for Puerto Rico, 

adjusted target amounts from a base period 

(section 1886(d)(9)(B)(i) of the Act), updated 

and otherwise adjusted in accordance with 

the provisions of section 1886(d) of the Act. 

The September 1, 1983 interim final rule (48 

FR 39763) contained a detailed explanation 

of how base-year cost data (from cost 

reporting periods ending during FY 1981) 

were established in the initial development 

of standardized amounts for the IPPS. The 

September 1, 1987 final rule (52 FR 33043 

and 33066) contains a detailed explanation of 

how the target amounts were determined, 

and how they are used in computing the 

Puerto Rico rates. 

Sections 1886(d)(2)(B) and (d)(2)(C) of the 

Act require us to update base-year per 

discharge costs for FY 1984 and then 

standardize the cost data in order to remove 

the effects of certain sources of cost 

variations among hospitals. These effects 

include case-mix, differences in area wage 

levels, cost-of-living adjustments for Alaska 

and Hawaii, indirect medical education 

costs, and costs to hospitals serving a 

disproportionate share of low-income 

patients. 

Under section 1886(d)(3)(E) of the Act, the 

Secretary estimates, from time-to-time, the 

proportion of hospitals’ costs that are 

attributable to wages and wage-related costs. 

The standardized amount is divided into 

labor-related and nonlabor-related amounts; 

only the proportion considered the laborrelated amount is adjusted by the wage 

index. Section 403 of Pub. L. 108–173 revises 

the proportion of the standardized amount 

that is considered labor-related. Specifically, 

section 1886(d)(3)(E) of the Act (as amended 

by section 403 of Pub. L. 108–173) requires 

that 62 percent of the standardized amount 

be adjusted by the wage index, unless doing 

so would result in lower payments to a 

hospital than would otherwise be made. 

(Section 403(b) of Pub. L. 108–173 extended 

this provision to the Puerto Rico 

standardized amounts.) We are proposing to 

update the labor-related share to 69.7 percent 

for FY 2006, as discussed in section IV.B.3. 

of the preamble to this proposed rule. We 

note that the revised labor-related share that 

we are proposing for FY 2006 was 

determined to be 69.731, as discussed in 

section IV of the preamble to this proposed 

rule. We are proposing to continue with our 

previous methodology and round the laborrelated share to 69.7 percent for purposes of 

establishing the labor-related and nonlaborrelated portions of the standardized amount. 

As discussed in section IV. of the preamble 

to this proposed rule, we are also proposing 

to rebase the current labor-related share for 

the Puerto Rico-specific amounts for FY 

2006. Since the proposed rebased Puerto Rico 

labor-related share has not yet been 

calculated, the proposed standardized 

amounts that appear in Table 1C of this 

Addendum for providers with a wage index 

greater than 1.0000 reflect the current (FY 

2005) labor-related share for the Puerto Ricospecific amounts of 71.3 percent for FY 2006. 

However, in the final rule, if we adopt our 

proposal to rebase the labor-related share for 

Puerto Rico, these amounts would reflect this 

revised labor-related share. We are proposing 

to adjust 62 percent of the national 

standardized amount and 62 percent of the 

Puerto Rico-specific amount by the wage 

index for all hospitals whose wage indexes 

are less than or equal to 1.0000. For all 

hospitals whose wage values are greater than 

1.0000, we are proposing to adjust the 

national standardized amount by a laborrelated share of 69.7 percent. 

2. Computing the Average Standardized 

Amount 

Sections 1886(d)(3)(A)(iv) of the Act 

previously required the Secretary to compute 

the following 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 accordance with section 

1886(b)(3)(B)(i) of the Act, the large urban 

average standardized amount was 1.6 percent 

higher than the other area average 

standardized amount. In addition, under 

sections 1886(d)(9)(B)(iii) and 

1886(d)(9)(C)(i) of the Act, the average 

standardized amounts per discharge were 

determined for hospitals located in urban 

and rural areas in Puerto Rico. 

Section 402(b) of Pub. L. 108–7 required 

that, effective for discharges occurring on or 

after April 1, 2003, and before October 1, 

2003, the Federal rate for all IPPS hospitals 

would be based on the large urban 

standardized amount. Subsequently, Pub. L. 

108–89 extended section 402(b) of Pub. L. 

108–7 beginning with discharges on or after 

October 1, 2003 and before March 31, 2004. 

Finally, section 401(a) of Pub. L. 108–173 

amended section 1886(d)(3)(A)(iv) of the Act 

to require that, beginning with FY 2004 and 

thereafter, an equal standardized amount is 

to be computed for all hospitals at the level 

computed for large urban hospitals during FY 

2003, updated by the applicable percentage 

update. This provision in effect makes 

permanent the equalization of the 

standardized amounts at the level of the 

previous standardized amount for large urban 

hospitals. Section 401(c) of Pub. L. 108–173 

also amended section 1886(d)(9)(A) of the 

Act to equalize the Puerto Rico-specific 

urban and rural area rates. Accordingly, we 

are providing in this proposed rule for a 

single national standardized amount and a 

23468 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

single Puerto Rico standardized amount for 

FY 2006. 

3. Updating the Average Standardized 

Amount 

In accordance with section 

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

proposing to update the equalized 

standardized amount for FY 2006 by the full 

estimated market basket percentage increase 

for hospitals in all areas, as specified in 

section 1886(b)(3)(B)(i)(XIX) of the Act, as 

amended by section 501 of Pub. L. 108–173. 

The percentage change in the market basket 

reflects the average change in the price of 

goods and services purchased by hospitals to 

furnish inpatient care. The most recent 

forecast of the hospital market basket 

increase for FY 2006 is 3.2 percent. Thus, for 

FY 2006, the proposed update to the average 

standardized amount is 3.2 percent for 

hospitals in all areas. 

Section 1886(b)(3)(B) of the Act specifies 

the mechanism used to update the 

standardized amount for payment for 

inpatient hospital operating costs. Section 

1886(b)(3)(B)(vii) of the Act, as amended by 

section 501(b) of Pub. L. 108–173, provides 

for a reduction of 0.4 percentage points to the 

update percentage increase (also known as 

the market basket update) for each of FYs 

2005 through 2007 for any ‘‘subsection (d) 

hospital’’ that does not submit data on a set 

of 10 quality indicators established by the 

Secretary as of November 1, 2003. The statute 

also provides that any reduction will apply 

only to the fiscal year involved, and will not 

be taken into account in computing the 

applicable percentage increase for a 

subsequent fiscal year. This measure 

establishes an incentive for hospitals to 

submit data on quality measures established 

by the Secretary. The proposed standardized 

amounts in Tables 1A through 1D of section 

VI. of this Addendum reflect these 

differential amounts. 

Although the update factors for FY 2006 

are set by law, we are required by section 

1886(e)(3) of the Act to report to the Congress 

our initial recommendation of update factors 

for FY 2006 for both IPPS hospitals and 

hospitals and hospital units excluded from 

the IPPS. Our recommendation on the update 

factors (which is required by sections 

1886(e)(4)(A) and (e)(5)(A) of the Act) is set 

forth as Appendix B of this proposed rule. 

4. Other Adjustments to the Average 

Standardized Amount 

As in the past, we are proposing to adjust 

the FY 2006 standardized amount to remove 

the effects of the FY 2005 geographic 

reclassifications and outlier payments before 

applying the FY 2006 updates. We then 

apply the new offsets for outliers and 

geographic reclassifications to the 

standardized amount for FY 2006. 

We do not remove the prior year’s budget 

neutrality adjustments for reclassification 

and recalibration of the DRG weights and for 

updated wage data because, in accordance 

with section 1886(d)(4)(C)(iii) of the Act, 

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. 

Budget neutrality is determined by 

comparing aggregate IPPS payments before 

and after making the changes that are 

required to be budget neutral (for example, 

reclassifying and recalibrating the DRGs, 

updating the wage data, and geographic 

reclassifications). We include outlier 

payments in the payment simulations 

because outliers may be affected by changes 

in these payment parameters. 

We are also proposing to adjust the 

standardized amount this year by an amount 

estimated to ensure that aggregate IPPS 

payments do not exceed the amount of 

payments that would have been made in the 

absence of the rural community hospital 

demonstration required under section 410A 

of Pub. L. 108–173. This demonstration is 

required to be budget neutral under section 

410A(c)(2) of Pub. L. 108–173. 

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. 

However, 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 

payments to hospitals are affected by factors 

other than average case weight. Therefore, as 

we have done in past years, we are proposing 

to make a budget neutrality adjustment to 

ensure that the requirement of section 

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

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

to update the hospital wage index on an 

annual basis beginning October 1, 1993. This 

provision also requires us to make any 

updates or adjustments to the wage index in 

a manner that ensures that aggregate 

payments to hospitals are not affected by the 

change in the wage index. For FY 2006, we 

are proposing to continue to adjust 10 

percent of the wage index factor for 

occupational mix. We describe the proposed 

occupational mix adjustment in section III.C. 

of the preamble to this proposed rule. 

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

requires us to update the wage index on a 

budget neutral basis, we are including the 

effects of this proposed occupational mix 

adjustment on the wage index in our budget 

neutrality calculations. 

In FY 2005, those urban hospitals that 

became rural under the new labor market 

area definitions were assigned the wage 

index of the urban area in which they were 

located under the previous labor market 

definitions for a 3-year period of FY 2005, FY 

2006, and FY 2007. Because we are in the 

second year of this 3-year transition, we are 

proposing to adjust the standardized amounts 

for FY 2006 to ensure budget neutrality for 

this policy. We discuss this adjustment in 

section III.B. of the preamble to this proposed 

rule. 

Section 4410 of Pub. L. 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 that State. This provision is required by 

section 4410(b) of Pub. L. 105–33 to be 

budget neutral. Therefore, we include the 

effects of this provision in our calculation of 

the wage update budget neutrality factor. As 

discussed in the FY 2005 IPPS final rule (69 

FR 49110), we are in the second year of the 

3-year provision that uses an imputed wage 

index floor for States that have no rural areas 

and States that have geographic rural areas, 

but that have no hospitals actually classified 

as rural. We are also adjusting for the effects 

of this provision in our calculation of the 

wage update budget neutrality factor. 

To comply with the requirement that DRG 

reclassification and recalibration of the 

relative weights be budget neutral, and the 

requirement that the updated wage index be 

budget neutral, we used FY 2004 discharge 

data to simulate payments and compared 

aggregate payments using the FY 2005 

relative weights and wage index to aggregate 

payments using the proposed FY 2006 

relative weights and wage index. The same 

methodology was used for the FY 2005 

budget neutrality adjustment. 

Based on this comparison, we computed a 

proposed budget neutrality adjustment factor 

equal to 1.002494. We also are proposing to 

adjust the Puerto Rico-specific standardized 

amount for the effect of DRG reclassification 

and recalibration. We computed a proposed 

budget neutrality adjustment factor for the 

Puerto Rico-specific standardized amount 

equal to 0.999003. These proposed budget 

neutrality adjustment factors are applied to 

the standardized amounts without removing 

the effects of the FY 2005 budget neutrality 

adjustments. In addition, as discussed in 

section V.C.2. of the preamble to this 

proposed rule, we are proposing to apply the 

same DRG reclassification and recalibration 

budget neutrality factor of 0.999003 to the 

hospital-specific rates that are effective for 

cost reporting periods beginning on or after 

October 1, 2005. 

Using the same data, we calculated a 

transition budget neutrality adjustment to 

account for the ‘‘hold harmless’’ policy under 

which urban hospitals that became rural 

under the new labor market area definitions 

were assigned the wage index of the urban 

area in which they were located under the 

previous labor market area definitions for a 

3-year period of FY 2005, FY 2006, and FY 

2007 (see Table 2 in section VI. of this 

Addendum). Using the prereclassified wage 

index, we simulated payments under the new 

labor market area definitions and compared 

them to simulated payments under the ‘‘hold 

harmless’’ policy. Based on this comparison, 

we computed a proposed transition budget 

neutrality adjustment of 0.999529. 

b. Reclassified Hospitals—Budget Neutrality 

Adjustment 

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

that, effective with discharges occurring on 

or after October 1, 1988, certain rural 

hospitals are deemed urban. In addition, 

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

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23469 

the reclassification of hospitals based on 

determinations by the MGCRB. Under section 

1886(d)(10) of the Act, a hospital may be 

reclassified for purposes of the wage index. 

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

Secretary is required to adjust the 

standardized amount to ensure that aggregate 

payments under the IPPS 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. (We note that neither the 

wage index reclassifications provided under 

section 508 of Pub. L. 108–173 nor the wage 

index adjustments provided under section 

505 of Pub. L. 108–173 are budget neutral. 

Section 508(b) of Pub. L. 108–173 provides 

that the wage index reclassifications 

approved under section 508(a) of Pub. L. 

108–173 ‘‘shall not be effected in a budget 

neutral manner.’’ Section 505(a) of Pub. L. 

108–173 similarly provides that any increase 

in a wage index under that section shall not 

be taken into account ‘‘in applying any 

budget neutrality adjustment with respect to 

such index’’ under section 1886(d)(8)(D) of 

the Act.) To calculate this proposed budget 

neutrality factor, we used FY 2004 discharge 

data to simulate payments, and compared 

total IPPS payments prior to any 

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

and (C) and 1886(d)(10) of the Act to total 

IPPS payments after such reclassifications. 

Based on these simulations, we are proposing 

to apply an adjustment factor of 0.992905 to 

ensure that the effects of this reclassification 

are budget neutral. 

The proposed adjustment factor is applied 

to the standardized amount after removing 

the effects of the FY 2005 budget neutrality 

adjustment factor. We note that the proposed 

FY 2006 adjustment reflects FY 2006 wage 

index reclassifications approved by the 

MGCRB or the Administrator, and the effects 

of MGCRB reclassifications approved in FY 

2004 and FY 2005 (section 1886(d)(10)(D)(v) 

of the Act makes wage index reclassifications 

effective for 3 years). 

c. Outliers 

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

for payments in addition to the basic 

prospective payments for ‘‘outlier’’ cases 

involving extraordinarily high costs. To 

qualify for outlier payments, a case must 

have costs above a fixed-loss cost threshold 

amount (a dollar amount by which the costs 

of a case must exceed payments in order to 

qualify for outlier payment). To determine 

whether the costs of a case exceed the fixedloss threshold, a hospital’s cost-to-charge 

ratio is applied to the total covered charges 

for the case to convert the charges to costs. 

Payments for eligible cases are then made 

based on a marginal cost factor, which is a 

percentage of the costs above the threshold. 

In accordance with section 

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

for any year are projected to be not less than 

5 percent nor more than 6 percent of total 

operating DRG payments plus outlier 

payments. Section 1886(d)(3)(B) of the Act 

requires the Secretary to reduce the average 

standardized amount by a 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 reduce the average 

standardized amounts applicable to hospitals 

in Puerto Rico to account for the estimated 

proportion of total DRG payments made to 

outlier cases. More information on outlier 

payments may be found on the CMS Web site 

at http://www.cms.hhs.gov/providers/hipps/ 

ippsotlr.asp. 

i. Proposed FY 2006 outlier fixed-loss 

threshold. For FY 2006, we are proposing a 

new methodology to calculate the outlier 

fixed-loss threshold. For FY 2004, we 

simulated outlier payments by applying FY 

2004 rates and policies using cases from the 

FY 2002 MedPAR file. In order to determine 

the FY 2004 outlier fixed-loss threshold, it 

was necessary to inflate the charges on the 

MedPAR claims by 2 years, from FY 2002 to 

FY 2004. In order to determine the FY 2004 

threshold, we used the 2-year average annual 

rate-of-change in charges per case to inflate 

FY 2002 charges to approximate FY 2004 

charges. (We refer the reader to the FY 2004 

IPPS final rule (67 FR 45476) for a complete 

discussion of the FY 2004 methodology.) In 

the IPPS proposed rule for FY 2005 (69 FR 

28376), we proposed to use the same 

methodology we used for determining the FY 

2004 outlier fix-loss threshold to determine 

the FY 2005 outlier threshold. We further 

noted that the rate-of-increase in the 2-year 

average annual rate-of-change in charges 

derived from the period before the changes 

we made to the policy affecting the 

applicable cost-to-charge ratios (68 FR 34494) 

and, therefore, they may have represented 

rates-of-increase that could be higher than 

the rates-of-increase under our new policy. 

As a result, we welcomed comments on the 

data we were using to update charges for 

purposes of the threshold and specifically 

encouraged commenters to provide 

recommendations for data that might better 

reflect current trends in charge increases. 

In response to the many comments we 

received on this proposed FY 2005 

methodology, in the IPPS final rule for FY 

2005 (69 FR 49275), we revised that proposed 

methodology and used the following 

methodology to calculate the final FY 2005 

outlier fixed-loss threshold. Instead of using 

the 2-year average annual rate-of-change in 

charges per case from FY 2001 to FY 2002 

and FY 2002 to FY 2003, we used more 

recent data to determine the annual rate-ofchange in charges for the FY 2005 outlier 

threshold. Specifically, we compared the 

rate-of-increase in charges from the first halfyear of FY 2003 to the first half-year of FY 

2004. We stated that we believed this 

methodology would result in a more accurate 

determination of the rate-of-change in 

charges per case between FY 2003 and FY 

2005. Although a full year of data was 

available for FY 2003, we did not have a full 

year of FY 2004 data at the time we set the 

FY 2005 outlier threshold. Therefore, we 

stated that we believed it was optimal to 

employ comparable periods in determining 

the rate-of-change from one year to the next. 

We also stated that we believed this 

methodology was the best methodology for 

determining the rate-of-change in charges per 

case because it used the most recent charge 

data available. Using this methodology, we 

established a fixed-loss cost outlier threshold 

for FY 2005 equal to the prospective payment 

rate for the DRG, plus any IME and DSH 

payment, and any add-on payment for new 

technology, plus $25,800. 

For FY 2006, we are proposing to use a 

new methodology to calculate the outlier 

threshold that will take into account the 

lower inflation in hospital charges that is 

occurring as a result of the June 9, 2003 

outlier final rule (68 FR 34505), which 

changed our methodology for determining 

outlier payments by implementing the use of 

more current and accurate cost-to-charge 

ratios when paying for outliers. As we have 

done in the past, to calculate the proposed 

FY 2006 outlier thresholds, we simulated 

payments by applying proposed FY 2006 

rates and policies using cases from the FY 

2004 MedPAR files. Therefore, in order to 

determine the appropriate proposed FY 2006 

outlier threshold, it was necessary to inflate 

the charges on the MedPAR claims by 2 

years, from FY 2004 to FY 2006. 

However, we are not proposing to inflate 

charges using a 2-year average annual rate-ofchange in charges per case from FY 2002 to 

FY 2003 and FY 2003 to FY 2004 because of 

the distortion in FY 2002 and FY 2003 charge 

data caused by the exceptionally high rate of 

hospital charge inflation during those years. 

Instead, we are proposing to use more recent 

data that reflect changes under the new 

outlier policy. However, we will continue to 

consider other methodologies in the future 

when calculating the outlier threshold once 

we have 2 complete years of charge data 

under the new outlier policy. 

Specifically, we are proposing to establish 

the proposed FY 2006 outlier threshold as 

follows: Using the latest data available, the 1- 

year average annualized rate-of-change in 

charges per case from the last quarter of FY 

2003 in combination with the first quarter of 

FY 2004 (July 1, 2003 through December 31, 

2003) to the last quarter of FY 2004 in 

combination with the first quarter of FY 2005 

(July 1, 2004 through December 31, 2004) 

was 8.65 percent (1.0865), or 18.04 percent 

(1.1804) over 2 years. As we have done in the 

past, we are proposing to use hospital costto-charge ratios from the most recent 

Provider Specific File, in this case the 

December 2004 update, in establishing the 

proposed FY 2006 outlier threshold. This file 

includes cost-to-charge ratios that reflect 

implementation of the changes to the policy 

for determining the applicable cost-to-charge 

ratios that became effective August 8, 2003 

(68 FR 34494). 

Using this methodology, we are proposing 

to establish a fixed-loss cost outlier threshold 

for FY 2006 equal to the prospective payment 

rate for the DRG, plus any IME and DSH 

payments, and any add-on payments for new 

technology, plus $26,675. In addition, as 

stated in the June 9, 2003 outlier final rule 

(68 FR 34505), we believe the use of charge 

inflation is more appropriate than our 

previous methodology of cost inflation 

because charges tend to increase at a much 

faster rate than costs. Although charges have 

increased at a slower rate since the 

implementation of changes to our outlier 

payment methodology in 2003, we believe 

the use of charges is still appropriate because 

this trend is still evident. 

23470 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

6These figures represent 3.0 standard deviations 

from the mean of the log distribution of cost-tocharge ratios for all hospitals. 

As we did in establishing the FY 2005 

outlier threshold (69 FR 49278), we are not 

including in the calculation of the outlier 

threshold the possibility that hospitals’ costto-charge ratios and outlier payments may be 

reconciled upon cost report settlement. We 

believe that, due to the policy implemented 

in the June 9, 2003 outlier final rule, cost-tocharge ratios will no longer fluctuate 

significantly and, therefore, few hospitals, if 

any, will actually have these ratios 

reconciled upon cost report settlement. In 

addition, it is difficult to predict which 

specific hospitals will have cost-to-charge 

ratios and outlier payments reconciled in 

their cost reports in any given year. We also 

note that reconciliation occurs because 

hospitals’ actual cost-to-charge ratios for the 

cost reporting period are different than the 

interim cost-to-charge ratios used to calculate 

outlier payments when a bill is processed. 

Our simulations assume cost-to-charge ratios 

accurately measure hospital costs and, 

therefore, are more reflective of postreconciliation than pre-reconciliation outlier 

payments. As a result, we omitted any 

assumptions about the effects of 

reconciliation from the outlier threshold 

calculation. 

ii. Other changes concerning outliers. As 

stated in the September 1, 1993 final rule (58 

FR 46348), we establish outlier thresholds 

that are applicable to both hospital inpatient 

operating costs and hospital 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 lower percentage 

of outlier payments for capital-related costs 

than for operating costs. We project that the 

proposed thresholds for FY 2006 will result 

in outlier payments equal to 5.1 percent of 

operating DRG payments and 5.03 percent of 

capital payments based on the Federal rate. 

In accordance with section 1886(d)(3)(B) of 

the Act, we reduced the proposed FY 2005 

standardized amount by the same percentage 

to account for the projected proportion of 

payments paid to outliers. 

The proposed outlier adjustment factors 

that would be applied to the standardized 

amount for FY 2006 are as follows: 

We are proposing to apply the outlier 

adjustment factors to the FY 2006 rates after 

removing the effects of the FY 2005 outlier 

adjustment factors on the standardized 

amount. 

To determine whether a case qualifies for 

outlier payments, we apply hospital-specific 

cost-to-charge ratios to the total covered 

charges for the case. Operating and capital 

costs for the case are calculated separately by 

applying separate operating and capital costto-charge ratios. These costs are then 

combined and compared with the fixed-loss 

outlier threshold. 

The June 9, 2003 outlier final rule (68 FR 

34494) eliminated the application of the 

statewide average for hospitals whose cost-tocharge ratios fall below 3 standard deviations 

from the national mean cost-to-charge ratio. 

However, for those hospitals for which the 

fiscal intermediary computes operating costto-charge ratios greater than 1.220 or capital 

cost-to-charge ratios greater than 0.169, or 

hospitals for whom the fiscal intermediary is 

unable to calculate a cost-to-charge ratio (as 

described at § 412.84(i)(3) of our regulations), 

we are still using statewide average ratios to 

calculate costs to determine whether a 

hospital qualifies for outlier payments.6

Table 8A in section VI. of this Addendum 

contains the proposed statewide average 

operating cost-to-charge ratios for urban 

hospitals and for rural hospitals for which 

the fiscal intermediary is unable to compute 

a hospital-specific cost-to-charge ratio within 

the above range. Effective for discharges 

occurring on or after October 1, 2005, these 

proposed statewide average ratios would 

replace the ratios published in the IPPS final 

rule for FY 2005 (69 FR 49687). Table 8B in 

section VI. of this Addendum contains the 

proposed comparable statewide average 

capital cost-to-charge ratios. Again, the 

proposed cost-to-charge ratios in Tables 8A 

and 8B would be used during FY 2006 when 

hospital-specific cost-to-charge ratios based 

on the latest settled cost report are either not 

available or are outside the range noted 

above. 

iii. FY 2004 and FY 2005 outlier payments. 

In the FY 2005 IPPS final rule, we stated that, 

based on available data, we estimated that 

actual FY 2004 outlier payments would be 

approximately 3.6 percent of actual total DRG 

payments (69 FR 49278, as corrected at 69 FR 

60252). This estimate was computed based 

on simulations using the FY 2003 MedPAR 

file (discharge data for FY 2003 bills). That 

is, the estimate of actual outlier payments did 

not reflect actual FY 2004 bills, but instead 

reflected the application of FY 2004 rates and 

policies to available FY 2003 bills. 

Our current estimate, using available FY 

2004 bills, is that actual outlier payments for 

FY 2004 were approximately 3.5 percent of 

actual total DRG payments. Thus, the data 

indicate that, for FY 2004, the percentage of 

actual outlier payments relative to actual 

total payments is lower than we projected 

before FY 2004 (and, thus, is less than the 

percentage by which we reduced the 

standardized amounts for FY 2004). We note 

that, for FY 2005, the outlier threshold was 

lowered to $25,800 compared to $31,000 for 

FY 2004. The outlier threshold was lower in 

FY 2005 than FY 2004 as a result of slower 

growth in hospital charge inflation. We 

believe that this slower growth was due to 

changes in hospital charge practices 

following implementation of the outlier final 

rule published on June 9, 2003. Nevertheless, 

consistent with the policy and statutory 

interpretation we have maintained since the 

inception of the IPPS, we do not plan to 

make retroactive adjustments to outlier 

payments to ensure that total outlier 

payments for FY 2004 are equal to 5.1 

percent of total DRG payments. 

We currently estimate that actual outlier 

payments for FY 2005 will be approximately 

4.4 percent of actual total DRG payments, 0.7 

percentage points lower than the 5.1 percent 

we projected in setting outlier policies for FY 

2005. This estimate is based on simulations 

using the FY 2004 MedPAR file (discharge 

data for FY 2004 bills). We used these data 

to calculate an estimate of the actual outlier 

percentage for FY 2005 by applying FY 2005 

rates and policies, including an outlier 

threshold of $25,800 to available FY 2004 

bills. 

d. Rural Community Hospital Demonstration 

Program Adjustment (Section 410A of Pub. L. 

108–173) 

Section 410A of Pub. L. 108–173 requires 

the Secretary to establish a demonstration 

that will modify reimbursement for inpatient 

services for up to 15 small rural hospitals. 

Section 410A(c)(2) of Pub. L. 108–173 

requires that ‘‘in conducting the 

demonstration program under this section, 

the Secretary shall ensure that the aggregate 

payments made by the Secretary do not 

exceed the amount which the Secretary 

would have paid if the demonstration 

program under this section was not 

implemented.’’ As discussed in section V.K. 

of the preamble to this proposed rule, we are 

proposing to satisfy this requirement by 

adjusting national IPPS rates by a factor that 

is sufficient to account for the added costs of 

this demonstration. We estimate that the 

average additional annual payment that will 

be made to each participating hospital under 

the demonstration will be approximately 

$977,410. We based this estimate on the 

recent historical experience of the difference 

between inpatient cost and payment for 

hospitals that are participating in the 

demonstration. For 13 participating 

hospitals, the total annual impact of the 

demonstration program is estimated to be 

$12,706,334. The required adjustment to the 

Federal rate used in calculating Medicare 

inpatient prospective payments as a result of 

the demonstration is 0.999863. 


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Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23471 

In order to achieve budget neutrality, we 

are proposing to adjust national IPPS rates by 

an amount sufficient to account for the added 

costs of this demonstration. In other words, 

we are proposing to apply budget neutrality 

across the payment system as a whole rather 

than merely across the participants of this 

demonstration. We believe that the language 

of the statutory budget neutrality requirement 

permits the agency to implement the budget 

neutrality provision in this manner. This is 

because the statutory language requires that 

‘‘aggregate payments made by the Secretary 

do not exceed the amount which the 

Secretary would have paid if the 

demonstration * * * was not implemented,’’

but does not identify the range across which 

aggregate payments must be held equal. 

5. Proposed FY 2006 Standardized Amount 

The adjusted standardized amount is 

divided into labor-related and nonlaborrelated portions. Tables 1A and 1B in section 

VI. of this Addendum contain the national 

standardized amount that we are proposing 

to apply to all hospitals, except hospitals in 

Puerto Rico. The amounts shown in the two 

tables differ only in that the labor-related 

share applied to the standardized amounts in 

Table 1A is 69.7 percent, and the laborrelated share applied to the standardized 

amounts in Table 1B is 62 percent. In 

accordance with sections 1886(d)(3)(E) and 

1886(d)(9)(C)(iv) of the Act, we are applying 

the labor-related share of 62 percent, unless 

the application of that percentage would 

result in lower payments to a hospital than 

would otherwise be made. The effect of this 

proposed application is that the labor-related 

share of the standardized amount is 62 

percent for all hospitals whose wage indexes 

are less than or equal to 1.0000. 

As discussed in section IV.B.3. of the 

preamble to this proposed rule (reflecting the 

Secretary’s current estimate of the proportion 

of costs that are attributable to wages and 

wage-related costs), we are proposing to set 

the labor-related share of the standardized 

amount at 69.7 percent for hospitals whose 

wage indexes are greater than 1.0000. In 

addition, Tables 1A and 1B include proposed 

standardized amounts reflecting the full 3.2 

percent update for FY 2006, and proposed 

standardized amounts reflecting the 0.4 

percentage point reduction to the update 

applicable for hospitals that fail to submit 

quality data consistent with section 501(b) of 

Pub. L. 108–173. (Tables 1C and 1D show the 

proposed standardized amounts for Puerto 

Rico for FY 2006, reflecting the different 

labor-related shares that apply, that is, 71.3 

percent or 62 percent.) 

The following table illustrates the 

proposed changes from the FY 2005 national 

average standardized amount. The first 

column shows the proposed changes from 

the FY 2005 standardized amounts for 

hospitals that satisfy the quality data 

submission requirement for receiving the full 

update (3.2 percent). The second column 

shows the proposed changes for hospitals 

receiving the reduced update (2.8 percent). 

The first row of the table shows the proposed 

updated (through FY 2005) average 

standardized amount after restoring the FY 

2005 offsets for outlier payments, 

demonstration budget neutrality, the wage 

index transition budget neutrality and 

geographic reclassification budget neutrality. 

The DRG reclassification and recalibration 

and wage index budget neutrality factor is 

cumulative. Therefore, the FY 2005 factor is 

not removed from the amount in the table. 

We have added separate rows to this table to 

reflect the different labor-related shares that 

apply to hospitals. 

23472 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

Under section 1886(d)(9)(A)(ii) of the Act, 

the Federal portion of the Puerto Rico 

payment rate is based on the dischargeweighted average of the national large urban 

standardized amount (as set forth in Table 

1A). The labor-related and nonlabor-related 

portions of the national average standardized 

amounts for Puerto Rico hospitals are set 

forth in Table 1C of section VI. of this 

Addendum. This table also includes the 

Puerto Rico standardized amounts. The 

labor-related share applied to the Puerto Rico 

standardized amount is 71.3 percent, or 62 

percent, depending on which is more 

advantageous to the hospital. (Section 

1886(d)(9)(C)(iv) of the Act, as amended by 

section 403(b) of Pub. L. 108–173, provides 

that the labor-related share for hospitals in 

Puerto Rico will be 62 percent, unless the 

application of that percentage would result in 

lower payments to the hospital.) 


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Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23473 

B. Adjustments for Area Wage Levels and 

Cost-of-Living 

Tables 1A through 1D, as set forth in 

section VI. of this Addendum, contain the 

labor-related and nonlabor-related shares that 

we are proposing to use 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 proposed 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 we 

make an adjustment to the labor-related 

portion of the national and Puerto Rico 

prospective payment rates, respectively, 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 to this proposed rule, we discuss 

the data and methodology for the proposed 

FY 2006 wage index. The proposed FY 2006 

wage indexes are set forth in Tables 4A, 4B, 

4C, and 4F of section VI. 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 2006, we are proposing to adjust the 

payments for hospitals in Alaska and Hawaii 

by multiplying the nonlabor-related portion 

of the standardized amount by the 

appropriate adjustment factor contained in 

the table below. If the Office of Personnel 

Management releases revised cost-of-living 

adjustment factors before July 1, 2005, we 

will publish them in the final rule and use 

them in determining FY 2006 payments. 

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 VI. of this Addendum contains the 

relative weights that we are proposing to use 

for discharges occurring in FY 2006. These 

factors have been recalibrated as explained in 

section II. of the preamble of this proposed 

rule. 

D. Calculation of Proposed Prospective 

Payment Rates for FY 2006 

General Formula for Calculation of 

Prospective Payment Rates for FY 2006 

The proposed operating prospective 

payment rate for all hospitals paid under the 

IPPS located outside of Puerto Rico, except 

SCHs and MDHs, equals the Federal rate 

based on the corresponding amounts in Table 

1A or Table 1B in section VI. of this 

Addendum. 

The proposed prospective payment rate for 

SCHs equals the higher of the applicable 

Federal rate (from Table 1A or Table 1B) or 

the hospital-specific rate as described below. 

The proposed prospective payment rate for 

MDHs equals the higher of the Federal rate, 

or the Federal rate plus 50 percent of the 

difference between the Federal rate and the 

hospital-specific rate as described below. The 

proposed prospective payment rate for Puerto 

Rico equals 25 percent of the Puerto Rico rate 

plus 75 percent of the applicable national 

rate from Table 1C or Table 1D in section VI. 

of this Addendum. 

1. Federal Rate 

For discharges occurring on or after 

October 1, 2005 and before October 1, 2006, 

except for SCHs, MDHs, and hospitals in 

Puerto Rico, payment under the IPPS is based 

exclusively on the Federal rate. 

The Federal rate is determined as follows: 

Step 1—Select the appropriate average 

standardized amount considering the 

applicable wage index (Table 1A for wage 

indexes greater than 1.0000 and Table 1B for 

wage indexes less than or equal to 1.0000) 

and whether the hospital has submitted 

qualifying quality data (full update for 

qualifying hospitals, update minus 0.4 

percentage points for nonqualifying 

hospitals). 

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 or the area to which 

the hospital is reclassified (see Tables 4A, 4B, 

and 4C of section VI. 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 VI. of this Addendum). 

The Federal rate as determined in Step 5 

may then be further adjusted if the hospital 

qualifies for either the IME or DSH 

adjustment. 

2. Hospital-Specific Rate (Applicable Only to 

SCHs and MDHs) 

a. Calculation of Hospital-Specific Rate 

Section 1886(b)(3)(C) of the Act provides 

that SCHs 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 costs 

per discharge; the updated hospital-specific 

rate based on FY 1987 costs per discharge; or 

the updated hospital-specific rate based on 

FY 1996 costs per discharge. 


EP04MY05.066</GPH>
23474 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

Section 1886(d)(5)(G) of the Act provides 

that MDHs are 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 hospital-specific rates based on 

either FY 1982 or FY 1987 costs per 

discharge. MDHs do not have the option to 

use their FY 1996 hospital-specific rate. 

Hospital-specific rates have been 

determined for each of these hospitals based 

on the FY 1982 costs per discharge, the FY 

1987 costs per discharge, or, for SCHs, the FY 

1996 costs per discharge. For a more detailed 

discussion of the calculation of the hospitalspecific rates, we refer the reader to the 

September 1, 1983 interim final rule (48 FR 

39772); the April 20, 1990 final rule with 

comment (55 FR 15150); the September 4, 

1990 final rule (55 FR 35994); and the August 

1, 2000 final rule (65 FR 47082). In addition, 

for both SCHs and MDHs, the hospitalspecific rate is adjusted by the proposed 

budget neutrality adjustment factor (that is, 

by the recalibration budget neutrality factor 

of 0.999003) as discussed in section V.C.2. of 

the preamble to this proposed rule. The 

resulting rate would be used in determining 

the payment rate an SCH or MDH would 

receive for its discharges beginning on or 

after October 1, 2005. 

b. Updating the FY 1982, FY 1987, and FY 

1996 Hospital-Specific Rates for FY 2005 

We are proposing to increase the hospitalspecific rates by 3.2 percent (the hospital 

market basket percentage increase) for SCHs 

and MDHs for FY 2006. Section 

1886(b)(3)(C)(iv) of the Act provides that the 

update factor applicable to the hospitalspecific rates for SCHs is equal to the update 

factor provided under section 

1886(b)(3)(B)(iv) of the Act, which, for SCHs 

in FY 2006, is the market basket rate of 

increase. Section 1886(b)(3)(D) of the Act 

provides that the update factor applicable to 

the hospital-specific rates for MDHs also 

equals the update factor provided under 

section 1886(b)(3)(B)(iv) of the Act, which, 

for FY 2006, is the market basket rate-ofincrease. 

3. General Formula for Calculation of 

Proposed Prospective Payment Rates for 

Hospitals Located in Puerto Rico Beginning 

On or After October 1, 2005 and Before 

October 1, 2006 

Under section 504 of Pub. L. 108–173, 

effective for discharges occurring on or after 

October 1, 2004, hospitals located in Puerto 

Rico are paid based on a blend of 75 percent 

of the national prospective payment rate and 

25 percent of the Puerto Rico-specific rate. 

a. Puerto Rico Rate 

The Puerto Rico prospective payment rate 

is determined as follows: 

Step 1—Select the appropriate average 

standardized amount considering the 

applicable wage index (see Table 1C). 

Step 2—Multiply the labor-related portion 

of the standardized amount by the 

appropriate Puerto Rico-specific wage index 

(see Table 4F of section VI. of the 

Addendum). 

Step 3—Add the amount from Step 2 and 

the nonlabor-related portion of the 

standardized amount. 

Step 4—Multiply the amount from Step 3 

by the appropriate DRG relative weight. 

Step 5—Multiply the result in Step 4 by 25 

percent (see Table 5 of section VI. of the 

Addendum). 

b. National Rate 

The national prospective payment rate is 

determined as follows: 

Step 1—Select the appropriate average 

standardized amount considering the 

applicable wage index (see Table 1C). 

Step 2—Add the amount from Step 1 and 

the nonlabor-related portion of the national 

average standardized amount. 

Step 3—Multiply the amount from Step 2 

by the appropriate DRG relative weight (see 

Table 5 of section VI. of the Addendum). 

Step 4—Multiply the result in Step 3 by 75 

percent. 

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. This rate 

may then be further adjusted if the hospital 

qualifies for either the IME or DSH 

adjustment. 

III. Proposed Changes to Payment Rates for 

Acute Care Hospital Inpatient CapitalRelated Costs for FY 2006 

(If you choose to comment on issues in this 

section, please include the caption ‘‘Capital 

Payment Rate’’ at the beginning of your 

comment.) 

The PPS for acute care hospital inpatient 

capital-related costs was implemented for 

cost reporting periods beginning on or after 

October 1, 1991. Effective with that cost 

reporting period, hospitals were paid during 

a 10-year transition period (which extended 

through FY 2001) to change the payment 

methodology for Medicare acute care hospital 

inpatient capital-related costs from a 

reasonable cost-based methodology to a 

prospective methodology (based fully on the 

Federal rate). 

The basic methodology for determining 

Federal capital prospective rates is set forth 

in regulations at §§ 412.308 through 412.352. 

Below we discuss the factors that we are 

proposing to use to determine the capital 

Federal rate for FY 2006, which would be 

effective for discharges occurring on or after 

October 1, 2005. The 10-year transition 

period ended with hospital cost reporting 

periods beginning on or after October 1, 2001 

(FY 2002). Therefore, for cost reporting 

periods beginning in FY 2002, all hospitals 

(except ‘‘new’’ hospitals under 

§ 412.304(c)(2)) are paid based on 100 

percent of the capital Federal rate. For FY 

1992, we computed the standard Federal 

payment rate for capital-related costs under 

the IPPS 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 capital standard Federal 

rate, as provided at § 412.308(c)(1), to 

account for capital input price increases and 

other factors. The regulations at 

§ 412.308(c)(2) provide that the capital 

Federal rate is adjusted annually by a factor 

equal to the estimated proportion of outlier 

payments under the capital Federal rate to 

total capital payments under the capital 

Federal rate. In addition, § 412.308(c)(3) 

requires that the capital Federal rate be 

reduced by an adjustment factor equal to the 

estimated proportion of payments for (regular 

and special) exceptions under § 412.348. 

Section 412.308(c)(4)(ii) requires that the 

capital standard Federal rate be adjusted so 

that the effects of 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 capital 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. Section 

412.308(b)(2) describes the 7.4 percent 

reduction to the capital rate that was made 

in FY 1994, and § 412.308(b)(3) describes the 

0.28 percent reduction to the capital rate 

made in FY 1996 as a result of the revised 

policy of paying for transfers. In FY 1998, we 

implemented section 4402 of Pub. L. 105–33, 

which required that, for discharges occurring 

on or after October 1, 1997, and before 

October 1, 2002, the unadjusted capital 

standard Federal rate is reduced by 17.78 

percent. As we discussed in the FY 2003 

IPPS final rule (67 FR 50102) and 

implemented in § 412.308(b)(6)), a small part 

of that reduction was restored effective 

October 1, 2002. 

To determine the appropriate budget 

neutrality adjustment factor and the regular 

exceptions payment adjustment during the 

10-year transition period, we developed a 

dynamic model of Medicare inpatient 

capital-related costs; that is, a model that 

projected changes in Medicare inpatient 

capital-related costs over time. With the 

expiration of the budget neutrality provision, 

the capital cost model was only used to 

estimate the regular exceptions payment 

adjustment and other factors during the 

transition period. As we explained in the FY 

2002 IPPS final rule (66 FR 39911), beginning 

in FY 2002, an adjustment for regular 

exception payments is no longer necessary 

because regular exception payments were 

only made for cost reporting periods 

beginning on or after October 1, 1991, and 

before October 1, 2001 (see § 412.348(b)). 

Because, effective with cost reporting periods 

beginning in FY 2002, payments are no 

longer being made under the regular 

exception policy, we no longer use the 

capital cost model. The capital cost model 

and its application during the transition 

period are described in Appendix B of the FY 

2002 IPPS final rule (66 FR 40099). 

Section 412.374 provides for the use of a 

blended payment system for payments to 

Puerto Rico hospitals under the PPS for acute 

care hospital inpatient capital-related costs. 

Accordingly, under the capital PPS, we 

compute a separate payment rate specific to 

Puerto Rico hospitals using the same 

methodology used to compute the national 

Federal rate for capital-related costs. In 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23475 

accordance with section 1886(d)(9)(A) of the 

Act, under the IPPS for acute care hospital 

operating costs, hospitals located in Puerto 

Rico are paid for operating costs under a 

special payment formula. Prior to FY 1998, 

hospitals in Puerto Rico were paid a blended 

operating rate that consisted of 75 percent of 

the applicable standardized amount specific 

to Puerto Rico hospitals and 25 percent of the 

applicable national average standardized 

amount. Similarly, prior to FY 1998, 

hospitals in Puerto Rico were paid a blended 

capital rate that consisted of 75 percent of the 

applicable capital Puerto Rico specific rate 

and 25 percent of the applicable capital 

Federal rate. However, effective October 1, 

1997, in accordance with section 4406 of 

Pub. L. 105–33, operating payments to 

hospitals in Puerto Rico were revised to 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. In conjunction with this change to 

the operating blend percentage, effective with 

discharges occurring on or after October 1, 

1997, we also revised the methodology for 

computing capital payments to hospitals in 

Puerto Rico to be based on a blend of 50 

percent of the Puerto Rico capital rate and 50 

percent of the capital Federal rate. 

As we discussed in the FY 2005 IPPS final 

rule (69 FR 49185), section 504 of Pub. L. 

108–173 increased the national portion of the 

operating IPPS payments for Puerto Rico 

hospitals from 50 percent to 62.5 percent and 

decreased the Puerto Rico portion of the 

operating IPPS payments from 50 percent to 

37.5 percent for discharges occurring on or 

after April 1, 2004 through September 30, 

2004 (see the March 26, 2004 One-Time 

Notification (Change Request 3158)). In 

addition, section 504 of Pub. L. 108–173 

provided that the national portion of 

operating IPPS payments for Puerto Rico 

hospitals is equal to 75 percent and the 

Puerto Rico portion of operating IPPS 

payments is equal to 25 percent for 

discharges occurring on or after October 1, 

2004. Consistent with that change in 

operating IPPS payments to hospitals in 

Puerto Rico, for FY 2005 (as we discussed in 

the FY 2005 IPPS final rule), we revised the 

methodology for computing capital payments 

to hospitals located in Puerto Rico to be 

based on a blend of 25 percent of the Puerto 

Rico capital rate and 75 percent of the capital 

Federal rate for discharges occurring on or 

after October 1, 2004. 

A. Determination of Proposed Federal 

Hospital Inpatient Capital-Related 

Prospective Payment Rate Update 

In the FY 2005 IPPS final rule (69 FR 

49283) and corrected in a December 30, 2004 

correction notice (69 FR 78532), we 

established a capital Federal rate of $416.53 

for FY 2005. 

In the discussion that follows, we explain 

the factors that were used to determine the 

proposed FY 2006 capital Federal rate. In 

particular, we explain why the proposed FY 

2006 capital Federal rate would increase 0.7 

percent compared to the FY 2005 capital 

Federal rate. We also estimate aggregate 

capital payments would decrease by 0.1 

percent during this same period. This 

decrease is due to several factors, including 

a projected decrease in the number of 

Medicare fee-for-service hospital admissions, 

and a decrease in the proposed geographic 

adjustment factor (GAF) values (which are 

based on the proposed wage index values). 

Our Office of the Actuary projects a decrease 

in Medicare fee-for-service Part A 

enrollment, in part, because of a projected 

increase in Medicare managed care 

enrollment as a result of the implementation 

of several provisions of Pub. L. 108–173. We 

are projecting a slight increase in the 

proposed GAF values (based on the proposed 

wage index) for some hospitals as a result of 

the completion of the transition to the CBSAbased labor market area definitions (as 

discussed in section III. of the preamble of 

this proposed rule). Thus, we are projecting 

that capital PPS payments would remain 

relatively unchanged from FY 2005 to FY 

2006. 

Total payments to hospitals under the IPPS 

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. Aggregate payments under the 

capital IPPS are estimated to decrease 

slightly in FY 2006 compared to FY 2005, as 

discussed above. 

1. Projected Capital Standard Federal Rate 

Update 

a. Description of the Update Framework 

Under § 412.308(c)(1), the capital standard 

Federal rate is updated on the basis of an 

analytical framework that takes into account 

changes in a capital input price index (CIPI) 

and several other 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 update factor for FY 

2006 under that framework is 0.7 percent 

based on the best data available at this time. 

The proposed update factor is based on a 

projected 0.7 percent increase in the CIPI, a 

0.0 percent adjustment for intensity, a 0.0 

percent adjustment for case-mix, a 0.0 

percent adjustment for the FY 2004 DRG 

reclassification and recalibration, and a 

forecast error correction of 0.0 percent. As 

discussed below in section III.C. of this 

Addendum, we believe that the CIPI is the 

most appropriate input price index for 

capital costs to measure capital price changes 

in a given year. We also explain the basis for 

the FY 2006 CIPI projection in that same 

section of this Addendum. Below we 

describe the proposed policy adjustments 

that have been applied. 

The case-mix index is the measure of the 

average DRG weight for cases paid under the 

IPPS. 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’’ case-mix 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. The capital update 

framework includes the same case-mix index 

adjustment used in the former operating IPPS 

update framework (as discussed in the May 

18, 2005 IPPS proposed rule for FY 2005 (69 

FR 28816)). (We are no longer using an 

update framework in making a 

recommendation for updating the operating 

IPPS standardized amounts as discussed in 

section III. of Appendix B of this proposed 

rule.) 

For FY 2006, we are projecting a 1.0 

percent total increase in the case-mix index. 

We estimate that the real case-mix increase 

would also equal 1.0 percent in FY 2006. The 

net adjustment for change in case-mix is the 

difference between the projected increase in 

real case-mix and the projected total increase 

in real case-mix. Therefore, the net proposed 

adjustment for case-mix change in FY 2006 

is 0.0 percentage points. 

The capital update framework also 

contains an adjustment for the effects of DRG 

reclassification and recalibration. This 

adjustment is intended to remove the effect 

on total payments of prior year changes to the 

DRG classifications and relative weights, in 

order to retain budget neutrality for all casemix index-related changes other than those 

due to patient severity. Due to the lag time 

in the availability of data, there is a 2-year 

lag in data used to determine the adjustment 

for the effects of DRG reclassification and 

recalibration. For example, we are adjusting 

for the effects of the FY 2004 DRG 

reclassification and recalibration as part of 

our proposed update for FY 2006. We 

estimate that FY 2004 DRG reclassification 

and recalibration would result 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. Therefore, we are proposing to 

make a 0.0 percent adjustment for DRG 

reclassification and recalibration in the 

update for FY 2006 to maintain budget 

neutrality. 

The capital update framework also 

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 and the 

forecast used in calculating the update 

factors. In setting a prospective payment rate 

under the framework, we make an 

adjustment for forecast error only if our 

estimate of the change in the capital input 

price index for any year is off by 0.25 

percentage points or more. There is a 2-year 

23476 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

lag between the forecast and the 

measurement of the forecast error. A forecast 

error of -0.1 percentage points was calculated 

for the FY 2004 update. That is, current 

historical data indicate that the forecasted FY 

2004 CIPI used in calculating the FY 2004 

update factor (0.7 percent) slightly overstated 

the actual realized price increases (0.6 

percent) by 0.1 percentage points. This slight 

overprediction was mostly due to a 

prediction of the cuts in the interest rate by 

the Federal Reserve Board in 2004. However, 

the Federal Reserve Board did not cut 

interest rates during 2004, which impacted 

the interest component of the CIPI. However, 

since this estimation of the change in the 

CIPI is less than 0.25 percentage points, it is 

not reflected in the update recommended 

under this framework. Therefore, we are 

proposing to make a 0.0 percent adjustment 

for forecast error in the update for FY 2006. 

Under the capital IPPS system framework, 

we also make an adjustment for changes in 

intensity. We calculate this adjustment using 

the same methodology and data that are used 

in the framework for the operating PPS. 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, for changes in within-DRG severity, 

and for expected modification of practice 

patterns to remove noncost-effective services. 

We calculate case-mix constant intensity as 

the change in total charges per admission, 

adjusted for price level changes (the CPI for 

hospital and related services) and changes in 

real case-mix. The use of total charges in the 

calculation of the intensity factor makes it a 

total intensity factor; that is, charges for 

capital services are already built into the 

calculation of the factor. Therefore, we have 

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 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. 

We have developed a Medicare-specific 

intensity measure based on a 5-year average. 

Past studies of case-mix change by the RAND 

Corporation (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)) suggest that real case-mix 

change was not dependent on total change, 

but was usually a fairly steady 1.0 to 1.4 

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. 

We calculate case-mix constant intensity as 

the change in total charges per admission, 

adjusted for price level changes (the CPI for 

hospital and related services), and changes in 

real case-mix. As we noted above, in 

accordance with § 412.308(c)(1)(ii), we began 

updating the capital standard Federal rate in 

FY 1996 using an update framework that 

takes into account, among other things, 

allowable changes in the intensity of hospital 

services. For FYs 1996 through 2001, we 

found that case-mix constant intensity was 

declining and we established a 0.0 percent 

adjustment for intensity in each of those 

years. For FYs 2002 and 2003, we found that 

case-mix constant intensity was increasing 

and we established a 0.3 percent adjustment 

and 1.0 percent adjustment for intensity, 

respectively. For FYs 2004 and 2005, we 

found that the charge data appeared to be 

skewed (as discussed in greater detail below) 

and we established a 0.0 percent adjustment 

in each of those years. Furthermore, we 

stated that we would continue to apply a 0.0 

percent adjustment for intensity until any 

increase in charges can be tied to intensity 

rather than attempts to maximize outlier 

payments. 

Using the methodology described above, 

for FY 2006 we examined the change in total 

charges per admission, adjusted for price 

level changes (the CPI for hospital and 

related services), and changes in real casemix for FYs 1999 through 2004. We found 

that, over this period and in particular the 

last 4 years of this period (FYs 2000 through 

2003), the charge data appear to be skewed. 

More specifically, we found a dramatic 

increase in hospital charges for FYs 2000 

through 2004 without a corresponding 

increase in the hospital case-mix index. 

These findings are similar to the considerable 

increase in hospitals’ charges, which we 

found when we were determining the 

intensity factor in the FY 2004 and FY 2005 

update recommendations as discussed in the 

FY 2004 IPPS final rule (68 FR 45482) and 

the FY 2005 IPPS final rule (69 FR 49285), 

respectively. If hospitals were treating new or 

different types of cases, which would result 

in an appropriate increase in charges per 

discharge, then we would expect hospitals’

case-mix to increase proportionally. 

As we discussed in the FY 2005 IPPS final 

rule (69 FR 49285), because our intensity 

calculation relies heavily upon charge data 

and we believe that these charge data may be 

inappropriately skewed, we established a 0.0 

percent adjustment for intensity for FY 2005. 

We believed that it was appropriate to apply 

a zero intensity adjustment until we believe 

that any increase in charges can be tied to 

intensity rather than to attempts to maximize 

outlier payments. As discussed above, we 

believe that the most recently available 

charge data used to make this determination 

may still be inappropriately skewed. 

Therefore, we are proposing a 0.0 percent 

adjustment for intensity for FY 2006. In the 

past (FYs 1996 through 2001) when we found 

intensity to be declining, we believed a zero 

(rather than negative) intensity adjustment 

was appropriate. Similarly, we believe that it 

is appropriate to propose to apply a zero 

intensity adjustment for FY 2006 until any 

increase in charges can be tied to intensity 

rather than to attempts to maximize outlier 

payments. 

Above we described the basis of the 

components used to develop the proposed 

0.7 percent capital update factor for FY 2006 

as shown in the table below. 


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b. Comparison of CMS and MedPAC Update 

Recommendation 

In the past, MedPAC has included update 

recommendations for capital PPS in a Report 

to Congress. In its March 2005 Report to 

Congress, MedPAC did not make an update 

recommendation for capital PPS payments 

for FY 2006. However, in that same report, 

MedPAC made an update recommendation 

for hospital inpatient and outpatient services 

(page 40). MedPAC reviews inpatient and 

outpatient services together since they are so 

closely interrelated. MedPAC recommended 

an increase in the payment rate for the 

operating IPPS by the projected increase in 

the hospital market basket index, less 0.4 

percent for FY 2006, based on their 

assessment of beneficiaries’ access to care, 

volume of services, access to capital, quality 

of care, and the relationship of Medicare 

payments and costs. In addition, the 

Commission considered the efficient 

provision of services in making its FY 2006 

update recommendations. (MedPAC’s Report 

to the Congress: Medicare Payment Policy, 

March 2005, page 44.) 

2. Proposed 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. 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 capital related 

outlier payments to total inpatient capitalrelated PPS payments. The outlier thresholds 

are set so that operating outlier payments are 

projected to be 5.1 percent of total operating 

DRG payments. 

In the FY 2005 IPPS final rule (69 FR 

49286), we estimate that outlier payments for 

capital will equal 4.94 percent of inpatient 

capital-related payments based on the capital 

Federal rate in FY 2005. Based on the 

thresholds as set forth in section II.A.4.c. of 

this Addendum, we estimate that outlier 

payments for capital would equal 5.03 

percent for inpatient capital-related 

payments based on the proposed Federal rate 

in FY 2006. Therefore, we are proposing to 

apply an outlier adjustment factor of 0.9497 

to the capital Federal rate. Thus, the 

percentage of capital outlier payments to 

total capital standard payments for FY 2006 

would be higher than the percentages for FY 

2005. 

The outlier reduction factors are not built 

permanently into the capital rates; that is, 

they are not applied cumulatively in 

determining the capital Federal rate. The 

proposed FY 2006 outlier adjustment of 

0.9497 is a ¥0.09 percent change from the 

FY 2005 outlier adjustment of 0.9506. The 

net change in the proposed outlier 

adjustment to the capital Federal rate for FY 

2006 is 0.9991 (0.9497/0.9506). Thus, the 

proposed outlier adjustment decreases the FY 

2006 capital Federal rate by 0.09 percent 

compared with the FY 2005 outlier 

adjustment. 

3. Proposed Budget Neutrality Adjustment 

Factor for Changes in DRG Classifications 

and Weights and the GAF 

Section 412.308(c)(4)(ii) requires that the 

capital Federal rate be adjusted so that 

aggregate payments for the fiscal year based 

on the capital Federal rate after any changes 

resulting from the annual DRG 

reclassification and recalibration and changes 

in the GAF are projected to equal aggregate 

payments that would have been made on the 

basis of the capital Federal rate without such 

changes. 

Since we implemented a separate GAF for 

Puerto Rico, we apply separate budget 

neutrality adjustments for the national GAF 

and the Puerto Rico GAF. We apply the same 

budget neutrality factor for DRG 

reclassifications and recalibration nationally 

and for Puerto Rico. Separate adjustments 

were unnecessary for FY 1998 and earlier 

because the GAF for Puerto Rico was 

implemented in FY 1998. 

In the past, we used the actuarial capital 

cost model (described in Appendix B of the 

FY 2002 IPPS final rule (66 FR 40099)) to 

estimate the aggregate payments that would 

have been made on the basis of the capital 

Federal rate with and without changes in the 

DRG classifications and weights and in the 

GAF to compute the adjustment required to 

maintain budget neutrality for changes in 

DRG weights and in the GAF. During the 

transition period, the capital cost model was 

also used to estimate the regular exception 

payment adjustment factor. As we explain in 

section III.A.4. of this Addendum, beginning 

in FY 2002, an adjustment for regular 

exception payments is no longer necessary. 

Therefore, we are no longer using the capital 

cost model. Instead, we are using historical 

data based on hospitals’ actual cost 

experiences to determine the exceptions 

payment adjustment factor for special 

exceptions payments. 

To determine the proposed factors for FY 

2006, we compared (separately for the 

national capital rate and the Puerto Rico 

capital rate) estimated aggregate capital 

Federal rate payments based on the FY 2005 

DRG relative weights and the average FY 

2005 GAF (that is, the weighted average of 

the GAFs applied from October 2004 through 

December 2004 and the GAFs applied from 

January 2005 through September 2005) to 

estimated aggregate capital Federal rate 

payments based on the proposed FY 2006 

relative weights and the proposed FY 2006 

GAF. As we established in the FY 2005 IPPS 

final rule (69 FR 49287), the budget 

neutrality factors were 0.9914 for the national 

capital rate and 0.9895 for the Puerto Rico 

capital rate for discharges occurring on or 

after October 1, 2004 through December 31, 

2004 (the first quarter of FY 2005). As a result 

of the corrections to the FY 2005 GAF values 

established in the December 30, 2004 

correction notice (69 FR 78531), effective for 

January 1, 2005 through September 30, 2005 

(the last three quarters of FY 2005), the 

budget neutrality factor for the national 

capital rate is 0.9912 and the budget 

neutrality factor for the Puerto Rico capital 

rate remained unchanged (0.9895). For FY 

2005, the weighted average budget neutrality 

adjustment factors were 0.9912 (0.9914 × 1⁄4

+ 0.9912 × 3⁄4) for the national capital rate 

(calculations were done on unrounded 

numbers) and 0.9895 for the Puerto Rico 

capital rate. In making the comparison, we 

set the regular and special exceptions 

reduction factors to 1.00. To achieve budget 

neutrality for the changes in the national 

GAF, based on calculations using updated 

data, we are proposing to apply an 

incremental budget neutrality adjustment of 

1.0022 for FY 2006 to the weighted average 

of the previous cumulative FY 2005 

adjustments of 0.9912 (yielding a proposed 

adjustment of 0.9934) through FY 2006 

(calculations done on unrounded numbers). 

For the Puerto Rico GAF, we are proposing 

to apply an incremental budget neutrality 

adjustment of 1.0240 for FY 2006 to the 

previous cumulative FY 2005 adjustment of 

0.9895, yielding a proposed cumulative 

adjustment of 1.0132 through FY 2006. 

We then compared estimated aggregate 

capital Federal rate payments based on the 

FY 2005 DRG relative weights and the 

average FY 2005 GAF to estimated aggregate 

capital Federal rate payments based on the 

proposed FY 2006 DRG relative weights and 

the proposed FY 2006 GAF. The proposed 

incremental adjustment for DRG 

classifications and changes in relative 

weights is 0.9998 both nationally and for 

Puerto Rico. The proposed cumulative 

adjustments for DRG classifications and 

changes in relative weights and for changes 

in the GAF through FY 2005 are 0.9931 

nationally and 1.013 for Puerto Rico. The 

following table summarizes the adjustment 

factors for each fiscal year: 

23478 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

The methodology used to determine the 

proposed recalibration and geographic (DRG/ 

GAF) budget neutrality adjustment factor for 

FY 2006 is similar to that used in 

establishing budget neutrality adjustments 

under the PPS for operating costs. One 

difference is that, under the operating PPS, 

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 

PPS, there is a single DRG/GAF budget 

neutrality adjustment factor (the national 

capital rate and the Puerto Rico capital rate 

are determined separately) for changes in the 

GAF (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, indirect 

medical education payments, or the large 

urban add-on payments. 

In the FY 2005 IPPS final rule (69 FR 

49288), we calculated a GAF/DRG budget 

neutrality factor of 1.0006 for FY 2005. As we 

noted above, as a result of the revisions to the 

GAF effective for discharges occurring on or 

after January 1, 2005 established in the 

December 30, 2004 correction notice (69 FR 

78351), we calculated a GAF/DRG budget 

neutrality factor of 1.0004 for discharges 

occurring in the remainder of FY 2005. For 

FY 2006, we are proposing a GAF/DRG 

budget neutrality factor of 1.0019. The GAF/ 


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DRG budget neutrality factors are built 

permanently into the capital rates; that is, 

they are applied cumulatively in determining 

the capital 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 proposed 

incremental change in the adjustment from 

the average from FY 2005 to FY 2006 is 

1.0019. The proposed cumulative change in 

the capital Federal rate due to this 

adjustment is 0.9931 (the product of the 

incremental factors for FYs 1993 through 

2005 and the proposed incremental factor of 

1.0019 for FY 2006). (We note that averages 

of the incremental factors that were in effect 

during FYs 2004 and 2005, respectively, were 

used in the calculation of the proposed 

cumulative adjustment of 0.9931 for FY 

2006.) 

This proposed factor accounts for DRG 

reclassifications and recalibration and for 

changes in the GAF. It also incorporates the 

effects on the GAF of FY 2006 geographic 

reclassification decisions made by the 

MGCRB compared to FY 2005 decisions. 

However, it does not account for changes in 

payments due to changes in the DSH and 

IME adjustment factors or in the large urban 

add-on. 

4. Proposed Exceptions Payment Adjustment 

Factor 

Section 412.308(c)(3) requires that the 

capital standard Federal rate be reduced by 

an adjustment factor equal to the estimated 

proportion of additional payments for both 

regular exceptions and special exceptions 

under § 412.348 relative to total capital PPS 

payments. In estimating the proportion of 

regular exception payments to total capital 

PPS payments during the transition period, 

we used the actuarial capital cost model 

originally developed for determining budget 

neutrality (described in Appendix B of the 

FY 2002 IPPS final rule (66 FR 40099)) to 

determine the exceptions payment 

adjustment factor, which was applied to both 

the Federal and hospital-specific capital 

rates. 

An adjustment for regular exception 

payments is no longer necessary in 

determining the proposed FY 2006 capital 

Federal rate because, in accordance with 

§ 412.348(b), regular exception payments 

were only made for cost reporting periods 

beginning on or after October 1, 1991 and 

before October 1, 2001. Accordingly, as we 

explained in the FY 2002 IPPS final rule (66 

FR 39949), in FY 2002 and subsequent fiscal 

years, no payments will be made under the 

regular exceptions provision. However, in 

accordance with § 412.308(c), we still need to 

compute a budget neutrality adjustment for 

special exception payments under 

§ 412.348(g). We describe our methodology 

for determining the special exceptions 

adjustment used in calculating the proposed 

FY 2006 capital Federal rate below. 

Under the special exceptions provision 

specified at § 412.348(g)(1), eligible hospitals 

include SCHs, urban hospitals with at least 

100 beds that have a disproportionate share 

percentage of at least 20.2 percent or qualify 

for DSH payments under § 412.106(c)(2), and 

hospitals with a combined Medicare and 

Medicaid inpatient utilization of at least 70 

percent. An eligible hospital may receive 

special exceptions payments if it meets (1) a 

project need requirement as described at 

§ 412.348(g)(2), which, in the case of certain 

urban hospitals, includes an excess capacity 

test as described at § 412.348(g)(4); (2) an age 

of assets test as described at § 412.348(g)(3); 

and (3) a project size requirement as 

described at § 412.348(g)(5). 

Based on information compiled from our 

fiscal intermediaries, six hospitals have 

qualified for special exceptions payments 

under § 412.348(g). Since we have cost 

reports ending in FY 2004 for all of these 

hospitals, we calculated the proposed 

adjustment based on actual cost experience. 

Using data from cost reports ending in FY 

2004 from the December 2004 update of the 

HCRIS data, we divided the capital special 

exceptions payment amounts for the six 

hospitals that qualified for special exceptions 

by the total capital PPS payment amounts 

(including special exception payments) for 

all hospitals. Based on the data from cost 

reports ending in FY 2004, this ratio is 

rounded to 0.0003. Because we have not 

received all cost reports ending in FY 2004, 

we also divided the FY 2004 special 

exceptions payments by the total capital PPS 

payment amounts for all hospitals with cost 

reports ending in FY 2003. This ratio also 

rounds to 0.0003. Because special exceptions 

are budget neutral, we are proposing to offset 

the capital Federal rate by 0.03 percent for 

special exceptions payments for FY 2006. 

Therefore, the proposed exceptions 

adjustment factor is equal to 0.9997 

(1¥0.0003) to account for special exceptions 

payments in FY 2006. 

In the FY 2005 IPPS final rule (69 FR 

49288), we estimated that total (special) 

exceptions payments for FY 2005 would 

equal 0.04 percent of aggregate payments 

based on the capital Federal rate. Therefore, 

we applied an exceptions adjustment factor 

of 0.9996 (1¥0.0004) in determining the FY 

2005 capital Federal rate. As we stated above, 

we estimate that exceptions payments in FY 

2006 would equal 0.03 percent of aggregate 

payments based on the proposed FY 2006 

capital Federal rate. Therefore, we are 

proposing to apply an exceptions payment 

adjustment factor of 0.9997 to the capital 

Federal rate for FY 2006. The proposed 

exceptions adjustment factor for FY 2006 is 

0.01 percent higher than the factor for FY 

2005 published in the FY 2005 IPPS final 

rule (69 FR 49288). The exceptions reduction 

factors are not built permanently into the 

capital rates; that is, the factors are not 

applied cumulatively in determining the 

capital Federal rate. Therefore, the proposed 

net change in the exceptions adjustment 

factor used in determining the proposed FY 

2006 capital Federal rate is 1.0001 (0.9997/ 

0.9996). 

5. Proposed Capital Standard Federal Rate for 

FY 2006 

In the FY 2005 IPPS final rule (69 FR 

49283) and corrected in a December 30, 2004 

correction notice (69 FR 78532), we 

established a capital Federal rate of $416.53 

for FY 2005. In this proposed rule, we are 

proposing to establish a capital Federal rate 

of $419.90 for FY 2006. The proposed capital 

Federal rate for FY 2006 was calculated as 

follows: 

• The proposed FY 2006 update factor is 

1.0070; that is, the update is 0.7 percent. 

• The proposed FY 2006 budget neutrality 

adjustment factor that is applied to the 

capital standard Federal payment rate for 

changes in the DRG relative weights and in 

the GAF is 1.0019. 

• The proposed FY 2006 outlier 

adjustment factor is 0.9497. 

• The proposed FY 2006 (special) 

exceptions payment adjustment factor is 

0.9997. 

Because the proposed capital 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 are proposing to 

make no additional adjustments in the 

capital 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 proposed factors and adjustments 

for FY 2006 affected the computation of the 

proposed FY 2006 capital Federal rate in 

comparison to the average FY 2005 capital 

Federal rate. The proposed FY 2006 update 

factor has the effect of increasing the capital 

Federal rate by 0.70 percent compared to the 

average FY 2005 Federal rate. The proposed 

GAF/DRG budget neutrality factor has the 

effect of increasing the capital Federal rate by 

0.19 percent. The proposed FY 2006 outlier 

adjustment factor has the effect of decreasing 

the capital Federal rate by 0.09 percent 

compared to the average FY 2005 capital 

Federal rate, and the proposed FY 2006 

exceptions payment adjustment factor has 

the effect of increasing the capital Federal 

rate by 0.01 percent compared to the 

exceptions payment adjustment factor for the 

FY 2005 capital Federal rate. The combined 

effect of all the proposed changes is to 

increase the capital Federal rate by 0.81 

percent compared to the average FY 2005 

capital Federal rate. 

23480 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

6. Proposed Special Capital Rate for Puerto 

Rico Hospitals 

Section 412.374 provides for the use of a 

blended payment system for payments to 

Puerto Rico hospitals under the PPS for acute 

care hospital inpatient capital-related costs. 

Accordingly, under the capital PPS, we 

compute a separate payment rate specific to 

Puerto Rico hospitals using the same 

methodology used to compute the national 

Federal rate for capital-related costs. Under 

the broad authority of section 1886(g) of the 

Act, as discussed in section VI. of the 

preamble of this proposed rule, beginning 

with discharges occurring on or after 

October 1, 2004, capital payments to 

hospitals in Puerto Rico are based on a blend 

of 25 percent of the Puerto Rico capital rate 

and 75 percent of the capital Federal rate. 

The Puerto Rico capital rate is derived from 

the costs of Puerto Rico hospitals only, while 

the capital Federal rate is derived from the 

costs of all acute care hospitals participating 

in the IPPS (including Puerto Rico). 

To adjust hospitals’ capital payments for 

geographic variations in capital costs, we 

apply a GAF to both portions of the blended 

capital rate. The GAF is calculated using the 

operating IPPS wage index and varies, 

depending on the labor market area or rural 

area in which the hospital is located. We use 

the Puerto Rico wage index to determine the 

GAF for the Puerto Rico part of the capitalblended rate and the national wage index to 

determine the GAF for the national part of 

the blended capital rate. 

Because we implemented a separate GAF 

for Puerto Rico in FY 1998, we also apply 

separate budget neutrality adjustments for 

the national GAF and for the Puerto Rico 

GAF. However, we apply the same budget 

neutrality factor for DRG reclassifications and 

recalibration nationally and for Puerto Rico. 

As we stated above in section III.A.4. of this 

Addendum, for Puerto Rico, the proposed 

GAF budget neutrality factor is 1.0240, while 

the proposed DRG adjustment is 0.9998, for 

a combined cumulative adjustment of 1.0130. 

In computing the payment for a particular 

Puerto Rico hospital, the Puerto Rico portion 

of the capital rate (25 percent) is multiplied 

by the Puerto Rico-specific GAF for the labor 

market area in which the hospital is located, 

and the national portion of the capital rate 

(75 percent) is multiplied by the national 

GAF for the labor market area in which the 

hospital is located (which is computed from 

national data for all hospitals in the United 

States and Puerto Rico). In FY 1998, we 

implemented a 17.78 percent reduction to the 

Puerto Rico capital rate as a result of Pub. L. 

105–33. In FY 2003, a small part of that 

reduction was restored. 

For FY 2005, before application of the 

GAF, the special capital rate for Puerto Rico 

hospitals was $199.01 for discharges 

occurring on or after October 1, 2004 through 

September 30, 2005. With the changes we are 

proposing to the factors used to determine 

the capital rate, the proposed FY 2006 special 

capital rate for Puerto Rico is $205.64. 

B. Calculation of Proposed Inpatient CapitalRelated Prospective Payments for FY 2006 

Because the 10-year capital PPS transition 

period ended in FY 2001, all hospitals 

(except ‘‘new’’ hospitals under § 412.324(b) 

and under § 412.304(c)(2)) are paid based on 

100 percent of the capital Federal rate in FY 

2006. The applicable proposed capital 

Federal rate was determined by making 

adjustments as follows: 

• For outliers, by dividing the proposed 

capital standard Federal rate by the proposed 

outlier reduction factor for that fiscal year; 

and 

• For the payment adjustments applicable 

to the hospital, by multiplying the hospital’s 

proposed GAF, disproportionate share 

adjustment factor, and IME adjustment factor, 

when appropriate. 

For purposes of calculating payments for 

each discharge during FY 2006, the capital 

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 the 

adjusted capital Federal rate. 

Hospitals also may 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. The proposed 

outlier thresholds for FY 2006 are in section 

II.A.4.c. of this Addendum. For FY 2006, a 

case qualifies as a cost outlier if the cost for 

the case plus the IME and DSH payments is 

greater than the prospective payment rate for 

the DRG plus $26,675. 

An eligible hospital may also qualify for a 

special exceptions payment under 

§ 412.348(g) for up through the 10th year 

beyond the end of the capital transition 

period if it meets: (1) A project need 

requirement described at § 412.348(g)(2), 

which in the case of certain urban hospitals 

includes an excess capacity test as described 

at § 412.348(g)(4); and (2) a project size 

requirement as described at § 412.348(g)(5). 

Eligible hospitals include SCHs, urban 

hospitals with at least 100 beds that have a 

DSH patient percentage of at least 20.2 

percent or qualify for DSH payments under 

§ 412.106(c)(2), and hospitals that have a 

combined Medicare and Medicaid inpatient 

utilization of at least 70 percent. Under 

§ 412.348(g)(8), the amount of a special 

exceptions payment is determined by 

comparing the cumulative payments made to 

the hospital under the capital PPS to the 

cumulative minimum payment level. This 

amount is offset by: (1) Any amount by 

which a hospital’s cumulative capital 

payments exceed its cumulative minimum 

payment levels applicable under the regular 

exceptions process for cost reporting periods 


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beginning during which the hospital has 

been subject to the capital PPS; and (2) any 

amount by which a hospital’s current year 

operating and capital payments (excluding 75 

percent of operating DSH payments) exceed 

its operating and capital costs. Under 

§ 412.348(g)(6), the minimum payment level 

is 70 percent for all eligible hospitals. 

During the transition period, new hospitals 

(as defined under § 412.300) were exempt 

from the capital PPS for their first 2 years of 

operation and were paid 85 percent of their 

reasonable costs during that period. Effective 

with the third year of operation through the 

remainder of the transition period, under 

§ 412.324(b), we paid the hospitals under the 

appropriate transition methodology. If the 

hold-harmless methodology were 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. 

Under § 412.304(c)(2), for cost reporting 

periods beginning on or after October 1, 

2002, we pay a new hospital 85 percent of 

its reasonable costs during the first 2 years 

of operation unless it elects to receive 

payment based on 100 percent of the capital 

Federal rate. Effective with the third year of 

operation, we pay the hospital based on 100 

percent of the capital Federal rate (that is, the 

same methodology used to pay all other 

hospitals subject to the capital PPS). 

C. Capital Input Price Index 

1. Background 

Like the operating input price index, the 

capital input price index (CIPI) is a fixedweight price index that measures the price 

changes associated with capital costs during 

a given year. The CIPI differs from the 

operating input price index in one important 

aspect—the CIPI reflects 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 weighted-average of past 

capital purchase prices up to and including 

the current year. 

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. The CIPI was 

last rebased to FY 1997 in the FY 2003 IPPS 

final rule (67 FR 50044). (We note that we are 

proposing a rebasing to FY 2002 in section 

IV. of the preamble of this proposed rule.) 

2. Forecast of the CIPI for FY 2006 

Based on the latest forecast by Global 

Insight, Inc. (first quarter of 2005), we are 

forecasting the CIPI to increase 0.7 percent in 

FY 2006. This reflects a projected 1.3 percent 

increase in vintage-weighted depreciation 

prices (building and fixed equipment, and 

movable equipment) and a 2.7 percent 

increase in other capital expense prices in FY 

2006, partially offset by a 2.3 percent decline 

in vintage-weighted interest expenses in FY 

2006. The weighted average of these three 

factors produces the 0.7 percent increase for 

the CIPI as a whole in FY 2006. 

IV. Proposed Changes to Payment Rates for 

Excluded Hospitals and Hospital Units: 

Rate-of-Increase Percentages 

(If you choose to comment on issues in this 

section, please include the caption ‘‘Excluded 

Hospitals Rate-of-Increase’’ at the beginning 

of your comment.) 

A. Payments to Existing Excluded Hospitals 

and Units 

As discussed in section VII. of the 

preamble of this proposed rule, in 

accordance with section 1886(b)(3)(H)(i) of 

the Act and effective for cost reporting 

periods beginning on or after October 1, 

2002, payments to existing psychiatric 

hospitals and units, rehabilitation hospitals 

and units, and long-term care hospitals 

(LTCHs) excluded from the IPPS are no 

longer subject to a cap on a hospital-specific 

target amount (expressed in terms of the 

inpatient operating cost per discharge under 

TEFRA) that is set for each hospital, based on 

the hospital’s own historical cost experience 

trended forward by the applicable percentage 

increase. However, the inpatient operating 

costs of children’s hospitals and cancer 

hospitals that are excluded from the IPPS 

continue to be subject to the rate-of-increase 

limits established under the authority of 

section 1886(b) of the Act and § 413.40 of the 

regulations. This target amount is applied as 

a ceiling on the allowable costs per discharge 

for the hospital’s cost reporting period. 

Effective for cost reporting periods 

beginning on or after October 1, 2002, 

rehabilitation hospitals and units are paid 

100 percent of the adjusted Federal 

prospective payment rate under the IRP PPS. 

Effective for cost reporting periods beginning 

on or after October 1, 2002, LTCHs also are 

no longer paid on a reasonable cost basis, but 

are paid under a LTCH DRG-based PPS. In 

implementing the LTCH PPS for existing 

LTCHs, we established a 5-year transition 

period from reasonable cost-based payments 

(subject to the TEFRA limit) to fully Federal 

prospective payment amounts during which 

a LTCH may receive a blended payment 

consisting of two payment components—one 

based on reasonable cost under the TEFRA 

payment system, and the other based on the 

standard Federal prospective payment rate. 

However, an existing LTCH may elect to be 

paid based on 100 percent of the standard 

Federal prospective payment rate during the 

transition period. 

IPFs that have their first cost reporting 

period beginning on or after January 1, 2005, 

are not paid on a reasonable cost basis but 

paid under a prospective per diem payment 

system. As part of the PPS for existing IPFs, 

we have established a 3-year transition 

period during which IPFs will be paid based 

on a blend of reasonable cost-based payment 

(subject to the TEFRA limit) and the 

prospective per diem payment rate. For cost 

reporting periods beginning on or after 

January l, 2008, IPFs will be paid 100 percent 

of the Federal prospective per diem payment 

amount. 

Excluded psychiatric hospitals and units as 

well as LTCHs that are paid under a blended 

methodology will have the reasonable costbased portion of their payment subject to a 

hospital target amount and, if applicable, the 

payment amount limitation. 

B. Updated Caps for New Excluded Hospitals 

and Units 

Section 1886(b)(7) of the Act established 

the method for determining the payment 

amount for new rehabilitation hospitals and 

units, psychiatric hospitals and units, and 

LTCHs that first received payment as a 

hospital or unit excluded from the IPPS on 

or after October 1, 1997. However, due to the 

implementation of the IRF PPS, effective for 

cost reporting periods beginning on or after 

October 1, 2002, this payment amount (or 

‘‘new provider cap’’) no longer applies to any 

new rehabilitation hospital or unit because 

they now are paid 100 percent of the Federal 

prospective rate under the IRF PPS. In 

addition, LTCHs that meet the definition of 

a new LTCH under § 412.23(e)(4) are paid 

100 percent of the fully Federal prospective 

payment rate. In contrast, those ‘‘new’’

LTCHs that meet the criteria under 

§ 413.40(f)(2)(ii) (that is, that were not paid 

as an excluded hospital prior to October 1, 

1997, but were paid as a LTCH before 

October 1, 2002), may be paid under the 

LTCH PPS transition methodology, with the 

reasonable cost portion of the payment 

subject to § 413.40(f)(2)(ii). Finally, LTCHs 

that existed prior to October 1, 1997, may 

also be paid under the LTCH PPS transition 

methodology, with the reasonable cost 

portion subject to § 413.40(c)(4)(ii). (The last 

LTCHs that were subject to the payment 

amount limitation for ‘‘new’’ LTCHs were 

new LTCHs that had their first cost reporting 

period beginning on September 30, 2002. In 

that case, the payment amount limitation 

remained applicable for the next 2 years—

September 30, 2002 through September 29, 

2003, and September 30, 2003 through 

September 29, 2004. This is because, under 

existing regulations at § 413.40(f)(2)(ii), the 

‘‘new hospital’’ would be subject to the same 

payment (target amount) in its second cost 

reporting period that was applicable to the 

LTCH in its first cost reporting period. 

Accordingly, for this hospital, the updated 

payment amount limitation that we 

published in the FY 2003 IPPS final rule (67 

FR 50103) applied through September 29, 

2004. Consequently, there is no longer a need 

to publish updated payment amounts for new 

(§ 413.40(f)(2)(ii)) LTCHs. A discussion of 

how the payment limitations were calculated 

can be found in the August 29, 1997 final 

rule with comment period (62 FR 46019); the 

May 12, 1998 final rule (63 FR 26344); the 

July 31, 1998 final rule (63 FR 41000); and 

the July 30, 1999 final rule (64 FR 41529). 

With the implementation of the LTCH PPS, 

payment limitations do not apply to any new 

LTCHs that meet the definition at 

§ 412.23(e)(4) because they are paid 100 

percent of the Federal prospective payment 

rate. 

A freestanding inpatient rehabilitation 

hospital, an inpatient rehabilitation unit of 

an acute care hospital, and an inpatient 

rehabilitation unit of a CAH are referred to 

as IRFs. Effective for cost reporting periods 

beginning on or after October 1, 2002, this 

23482 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

payment limitation is also no longer 

applicable to new rehabilitation hospitals 

and units because they are paid 100 percent 

of the Federal prospective rate under the IRF 

PPS. Therefore, it is also no longer necessary 

to update the payment limitation for new 

rehabilitation hospitals or units. 

Under the IPF PPS, there is a 3-year 

transition period during which existing IPFs 

will receive a blended payment of the 

Federal per diem payment amount and the 

payment amount that IPFs would receive 

under the reasonable cost-based payment 

(TEFRA) methodology. IPFs that were ‘‘new’’

under § 413.40(f)(2)(ii) (that is, that were not 

paid as an excluded hospital prior to October 

1, 1997, but were paid as an IPF prior to 

January 1, 2005), would have the reasonable 

cost portion of the transition period payment 

subject to the payment amount limitation as 

determined according to § 413.40(f)(2)(ii). 

The last ‘‘new’’ IPFs that were subject to the 

payment amount limitation were IPFs that 

had their first cost reporting period beginning 

on December 31, 2004. For these hospitals, 

the payment amount limitation that was 

published in the FY 2005 IPPS final rule (69 

FR 49189) for cost reporting periods 

beginning on or after October 1, 2004, and 

before January 1, 2005, remains applicable 

for the IPF’s first two cost reporting periods. 

IPFs with a first cost reporting period 

beginning on or after January 1, 2005, are 

paid 100 percent of the Federal rate and are 

not subject to the payment amount 

limitation. Therefore, since the last IPFs 

eligible for a blended payment have a cost 

reporting period beginning on December 31, 

2004, the payment limitation published for 

FY 2005 remains applicable for these IPFs, 

and publication of the updated payment 

amount limitation is no longer needed. We 

note that IPFs that existed prior to October 

1, 1997, may also be paid under the IPF 

transition methodology with the reasonable 

cost portion of the payment subject to 

§ 413.40(c)(4)(ii). 

The payment limitations for new hospitals 

under TEFRA do not apply to new LTCHs, 

IRFs, or IPFs, that is, these hospitals with 

their first cost reporting period beginning on 

or after the date that the particular class of 

hospitals implemented the respective PPS. 

Therefore, for the reasons noted above, we 

are proposing to discontinue publishing 

Tables 4G and 4H (Pre-Reclassified Wage 

Index for Urban and Rural Areas, 

respectively) in the annual proposed and 

final IPPS rules. 

V. Payment for Blood Clotting Factor 

Administered to Hemophilia Inpatients 

(If you choose to comment on issues in this 

section, please include the caption ‘‘Payment 

for Blood Clotting Factor’’ at the beginning of 

your comments.) 

As discussed in section VIII. of the 

preamble to this proposed rule, section 

1886(a)(4) of the Act excludes the costs of 

administering blood clotting factors to 

individuals with hemophilia from the 

definition of ‘‘operating costs of inpatient 

hospital services.’’ Section 6011(b) of Pub. L. 

101–239 (the Omnibus Budget Reconciliation 

Act of 1989) provides that the Secretary shall 

determine the payment amount made to 

hospitals under Part A of Title XVIII of the 

Act for the costs of administering blood 

clotting factors to individuals with 

hemophilia by multiplying a predetermined 

price per unit of blood clotting factor by the 

number of units provided to the individual. 

Currently, we use the average wholesale 

price (AWP) methodology used to determine 

rates paid for Medicare Part B drugs to price 

blood clotting factors administered to 

inpatients who have hemophilia under 

Medicare Part A. Section 303 of Pub. L. 108–

173 amended the Act by adding section 

1847A, which changed the drug pricing 

system under Medicare Part B. Effective 

January 1, 2005, section 1847A of the Act 

established a payment methodology based on 

average sales price (ASP) under which almost 

all Medicare Part B drugs and biologicals not 

paid on a cost or prospective basis are paid 

at 106 percent of the ASP. 

In the FY 2005 IPPS final rule (69 FR 

49292), we had instructed the fiscal 

intermediaries for FY 2005 to continue to use 

the Single Drug Pricer (SDP) to establish the 

pricing limits for the blood clotting factor 

administered to hemophilia inpatients at 95 

percent of the AWP. We did not use the new 

ASP pricing methodology for Part A blood 

clotting factor in FY 2005 because the IPPS 

final rule was published in advance of final 

regulations implementing the ASP payment 

methodology for Part B drugs and biologicals. 

Final regulations establishing the ASP 

methodology and the furnishing fee for blood 

clotting factor under Medicare Part B were 

published on November 15, 2004 (69 FR 

66299). Therefore, we believe that a 

consistent methodology should be used to 

pay for blood clotting factor administered 

under both Medicare Part A and Part B. For 

this reason, we are proposing for FY 2006 

that the fiscal intermediaries make payment 

for blood clotting factor using 106 percent of 

ASP and make payment for the furnishing fee 

at $0.14 per individual unit (I.U.) that is 

currently used for Medicare Part B drugs. The 

ASP will be updated quarterly. The 

furnishing fee will be updated annually 

based on the consumer price index. 

VI. Tables 

This section contains the tables referred to 

throughout the preamble to this proposed 

rule and in this Addendum. Tables 1A, 1B, 

1C, 1D, 2, 3A, 3B, 4A, 4B, 4C, 4F, 4J, 5, 6A, 

6B, 6C, 6D, 6E, 6F, 6G, 6H, 7A, 7B, 8A, 8B, 

9A, 9B, 9C, 10, and 11 are presented below. 

The tables presented below are as follows: 

Table 1A—National Adjusted Operating 

Standardized Amounts, Labor/Nonlabor 

(69.7 Percent Labor Share/30.3 Percent 

Nonlabor Share If Wage Index Is Greater 

Than 1); 

Table 1B—National Adjusted Operating 

Standardized Amounts, Labor/Nonlabor 

(62 Percent Labor Share/38 Percent 

Nonlabor Share If Wage Index Is Less 

Than or Equal To 1); 

Table 1C—Adjusted Operating Standardized 

Amounts for Puerto Rico, Labor/ 

Nonlabor; 

Table 1D—Capital Standard Federal Payment 

Rate; 

Table 2—Hospital Case-Mix Indexes for 

Discharges Occurring in Federal Fiscal 

Year 2004; Hospital Average Hourly 

Wage for Federal Fiscal Years 2004 (2000 

Wage Data), 2005 (2001 Wage Data), and 

2006 (2002 Wage Data) Wage Indexes 

and 3-Year Average of Hospital Average 

Hourly Wages; 

Table 3A—FY 2006 3-Year Average Hourly 

Wage for Urban Areas by CBSA; 

Table 3B—FY 2006 and 3-Year Average 

Hourly Wage for Rural Areas by CBSA; 

Table 4A—Wage Index and Capital 

Geographic Adjustment Factor (GAF) for 

Urban Areas by CBSA; 

Table 4B—Wage Index and Capital 

Geographic Adjustment Factor (GAF) for 

Rural Areas by CBSA; 

Table 4C—Wage Index and Capital 

Geographic Adjustment Factor (GAF) for 

Hospitals That Are Reclassified by 

CBSA; 

Table 4F—Puerto Rico Wage Index and 

Capital Geographic Adjustment Factor 

(GAF) by CBSA; 

Table 4J—Out-Migration Adjustment—FY 

2006; 

Table 5—List of Diagnosis Related Groups 

(DRGs), Relative Weighting Factors, 

Geometric and Arithmetic Mean Length 

of Stay; 

Table 6A—New Diagnosis Codes; 

Table 6B—New Procedure Codes; 

Table 6C—Invalid Diagnosis Codes; 

Table 6D—Invalid Procedure Codes; 

Table 6E—Revised Diagnosis Code Titles; 

Table 6F—Revised Procedure Code Titles; 

Table 6G—Additions to the CC Exclusions 

List; 

Table 6H—Deletions from the CC Exclusions 

List; 

Table 7A—Medicare Prospective Payment 

System Selected Percentile Lengths of 

Stay FY 2004 MedPAR Update December 

2004 GROUPER V22.0; 

Table 7B—Medicare Prospective Payment 

System Selected Percentile Lengths of 

Stay FY 2004 MedPAR Update December 

2004 GROUPER V23.0; 

Table 8A—Statewide Average Operating 

Cost-to-Charge Ratios—March 2005; 

Table 8B—Statewide Average Capital Cost-toCharge Ratios—March 2005; 

Table 9A—Hospital Reclassifications and 

Redesignations by Individual Hospital 

and CBSA—FY 2006; 

Table 9B—Hospital Reclassifications and 

Redesignations by Individual Hospital 

Under Section 508 of Pub. L. 108–173—

FY 2006; 

Table 9C—Hospitals Redesignated as Rural 

under Section 1886(s)(8)(E) of the Act—

FY 2006; 

Table 10—Geometric Mean Plus the Lesser of 

.75 of the National Adjusted Operating 

Standardized Payment Amount 

(Increased to Reflect the Difference 

Between Costs and Charges) or .75 of 

One Standard Deviation of Mean Charges 

by Diagnosis-Related Groups (DRGs)—

March 2005; 

Table 11—Proposed FY 2006 LTC-DRGs, 

Relative Weights, Geometric Average 

Length of Stay, and 5/6ths of the 

Geometric Average Length of Stay. 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23483 

TABLE 1A.—NATIONAL ADJUSTED OPERATING STANDARDIZED AMOUNTS, LABOR/NONLABOR

[69.7 Percent labor share/30.3 percent nonlabor share if wage index greater than 1] 

Full update (3.2 Percent) Reduced update (2.8 Percent) 

Labor-related Nonlabor-related Labor-related Nonlabor-related 

$3,286.14 $1,428.55 $3,273.40 $1,423.01 

TABLE 1B.—NATIONAL ADJUSTED OPERATING STANDARDIZED AMOUNTS, LABOR/NONLABOR

[62 Percent labor share/38 percent nonlabor share if wage index less than or equal to 1] 

Full update (3.2 Percent) Reduced update (2.8 Percent) 

Labor-related Nonlabor-related Labor-related Nonlabor-related 

$2,923.11 $1,791.58 $2,911.78 $1,784.63 

TABLE 1C.—ADJUSTED OPERATING STANDARDIZED AMOUNTS FOR PUERTO RICO, LABOR/NONLABOR

Rates if wage index less 

than or equal to 1 

Rates if wage index greater than 1 Labor Nonlabor Labor Nonlabor 

National ............................................................................................................................ $3,286.14 $1,428.55 $2,923.11 $1,791.58 

uerto Rico ........................................................................................................................ $1,608.99 $647.66 $1,431.24 $812.25 

TABLE 1D.—CAPITAL STANDARD FEDERAL PAYMENT RATE

Rate 

National .................................................................................................................................................................................................... $419.90 

Puerto Rico .............................................................................................................................................................................................. $205.64 

TABLE 2.—HOSPITAL CASE-MIX INDEXES FOR DISCHARGES OCCURRING IN FEDERAL FISCAL YEAR 2004; HOSPITAL AVERAGE HOURLY WAGE FOR FEDERAL FISCAL YEARS 2004 (2000 WAGE DATA), 2005 (2001 WAGE DATA), AND 2006 

(2002 WAGE DATA) WAGE INDEXES AND 3-YEAR AVERAGE OF HOSPITAL AVERAGE HOURLY WAGES

Provider number Case-mix 

index 

Wage index 

FY 2006 

Average 

hourly wage 

FY 2004 

Average 

hourly wage 

FY 2005 

Average 

hourly wage 

FY 2006 

Average 

hourly 

wage ** 

(3 years) 

010001 ............................................................................. 1.4678 0.7743 19.4061 20.6563 21.3753 20.5001 

010004 ............................................................................. *** * 22.2674 22.7585 * 22.4801 

010005 h ........................................................................... 1.1407 0.8872 19.6063 20.4937 22.4906 20.9007 

010006 ............................................................................. 1.4394 0.8305 19.0976 21.0241 23.4823 21.1655 

010007 ............................................................................. 1.0619 0.7495 17.5462 16.8811 18.2430 17.5458 

010008 ............................................................................. 0.9712 0.8276 19.6573 23.8333 20.4591 21.3782 

010009 ............................................................................. 0.9770 0.8517 20.4309 21.6422 23.2229 21.7690 

010010 h ........................................................................... 1.0191 0.9124 19.2644 22.3021 22.3366 21.3489 

010011 ............................................................................. 1.5689 0.8979 25.8231 24.8166 27.4850 26.0626 

010012 ............................................................................. 1.2232 0.9099 20.0896 21.7622 22.7020 21.5233 

010015 ............................................................................. 0.9785 0.7495 18.8890 20.4732 22.1736 20.6719 

010016 ............................................................................. 1.3257 0.8979 21.7918 23.0414 25.1502 23.3217 

010018 ............................................................................. 1.3369 0.8979 19.2071 20.5888 22.2990 20.6865 

010019 ............................................................................. 1.2272 0.8305 18.9177 20.1336 22.0906 20.4039 

010021 h ........................................................................... 1.1869 0.7743 17.7596 20.7108 18.6785 19.0123 

010022 ............................................................................. 0.9401 0.9414 22.2267 25.8797 24.5670 24.2502 

010023 ............................................................................. 1.8430 0.8600 20.4901 23.7791 27.3303 23.6794 

010024 ............................................................................. 1.5884 0.8600 18.5942 20.0067 20.7265 19.7702 

010025 ............................................................................. 1.3235 0.8402 19.3649 19.8561 21.2674 20.1430 

010027 ............................................................................. 0.7634 0.7495 14.0975 14.9585 15.3704 14.7992 

010029 ............................................................................. 1.5415 0.8402 20.9868 21.6724 22.6976 21.8061 

010031 ............................................................................. *** * 21.0176 20.9463 * 20.9818 

010032 ............................................................................. 0.8730 0.7495 16.4713 18.5073 19.1555 18.1219 

010033 ............................................................................. 2.0553 0.8979 24.5088 25.5165 26.4666 25.5126 

010034 ............................................................................. 0.9588 0.8600 14.9333 17.1625 16.9686 16.3417 

010035 ............................................................................. 1.2540 0.8872 21.6182 23.1319 22.2870 22.3532 

010036 ............................................................................. 1.1183 0.7495 19.2501 20.5125 22.9747 20.9446 

010038 ............................................................................. 1.3277 0.7702 18.6578 20.3935 21.4509 20.2189 

23484 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

TABLE 2.—HOSPITAL CASE-MIX INDEXES FOR DISCHARGES OCCURRING IN FEDERAL FISCAL YEAR 2004; HOSPITAL AVERAGE HOURLY WAGE FOR FEDERAL FISCAL YEARS 2004 (2000 WAGE DATA), 2005 (2001 WAGE DATA), AND 2006 

(2002 WAGE DATA) WAGE INDEXES AND 3-YEAR AVERAGE OF HOSPITAL AVERAGE HOURLY WAGES—Continued 

Provider number Case-mix 

index 

Wage index 

FY 2006 

Average 

hourly wage 

FY 2004 

Average 

hourly wage 

FY 2005 

Average 

hourly wage 

FY 2006 

Average 

hourly 

wage ** 

(3 years) 

010039 ............................................................................. 1.6315 0.9124 23.0339 23.4151 25.8594 24.1509 

010040 ............................................................................. 1.4605 0.7974 20.7779 21.6708 22.8851 21.7864 

010043 ............................................................................. 1.0587 0.8979 19.9012 19.5422 22.5945 20.7320 

010044 ............................................................................. 1.0475 0.8872 25.8560 23.0220 21.4036 23.2608 

010045 ............................................................................. 1.0959 0.8872 22.7713 20.5658 20.0357 20.9382 

010046 ............................................................................. 1.4626 0.7974 19.6754 20.8935 21.6965 20.8067 

010047 ............................................................................. 0.8793 0.7495 16.1695 19.5937 21.0604 18.8438 

010049 ............................................................................. 1.0828 0.7495 16.2973 17.7801 20.2413 18.1494 

010050 ............................................................................. 1.0401 0.8979 20.7398 21.5625 22.1584 21.5077 

010051 ............................................................................. 0.8969 0.8724 14.3006 14.7053 15.2208 14.7351 

010052 ............................................................................. 0.8624 0.7495 11.9019 21.3673 16.4959 15.4174 

010053 ............................................................................. 1.0098 0.7495 17.3238 17.4160 19.0108 17.9166 

010054 ............................................................................. 1.0570 0.8517 20.6382 23.1894 22.5554 22.1149 

010055 ............................................................................. 1.4983 0.7743 18.9664 19.1847 22.6828 20.2397 

010056 ............................................................................. 1.5206 0.8979 21.1104 22.7183 23.7144 22.5773 

010058 ............................................................................. 0.8800 0.8979 17.7800 20.3182 18.5537 18.9295 

010059 ............................................................................. 1.0562 0.8517 20.5534 23.6963 21.3237 21.8874 

010061 ............................................................................. 0.9666 0.7495 17.0447 20.5683 21.9374 19.8090 

010062 ............................................................................. 1.0674 0.7743 17.1786 18.1323 18.3435 17.8796 

010064 ............................................................................. 1.7183 0.8979 22.2280 25.4345 26.1110 24.2542 

010065 ............................................................................. 1.4288 0.8276 17.2698 20.0108 21.2363 19.5522 

010066 ............................................................................. 0.8327 0.7495 14.8696 17.0935 17.6152 16.5083 

010068 ............................................................................. 1.2192 0.8979 18.3308 17.5690 19.0789 18.3440 

010069 ............................................................................. 1.0478 0.7495 17.0957 19.6317 21.3608 19.4027 

010072 ............................................................................. 1.1391 0.7702 18.8807 21.5419 21.8169 20.7331 

010073 ............................................................................. 0.9330 0.7495 14.9826 16.4043 16.4168 15.9303 

010078 ............................................................................. 1.3809 0.7702 20.1447 21.0633 21.5616 20.9141 

010079 ............................................................................. 1.1647 0.9124 20.7401 20.4254 21.8199 21.0143 

010083 h ........................................................................... 1.2094 0.8089 19.8524 20.2166 22.3041 20.7945 

010084 ............................................................................. 1.5531 0.8979 21.6522 22.5219 24.7127 22.9810 

010085 ............................................................................. 1.2261 0.8517 22.5282 23.7007 24.4710 23.5499 

010086 ............................................................................. 1.0771 0.7495 18.0122 19.4332 18.6081 18.6721 

010087 ............................................................................. 1.9176 0.7902 19.7620 21.6226 22.5225 21.2536 

010089 ............................................................................. 1.2348 0.8979 19.5783 22.2508 22.7508 21.4924 

010090 ............................................................................. 1.6643 0.7902 20.0287 21.4322 23.6948 21.7237 

010091 ............................................................................. 0.9178 0.7495 17.4672 19.4222 18.6912 18.5367 

010092 ............................................................................. 1.5079 0.8724 19.9351 22.0709 24.6542 22.1991 

010095 ............................................................................. 0.8622 0.8724 12.5243 13.4426 13.9326 13.3037 

010097 ............................................................................. 0.7734 0.8600 15.1593 17.1735 16.7548 16.2912 

010098 ............................................................................. 1.1131 0.7495 15.1629 19.6717 14.3076 16.0844 

010099 ............................................................................. 0.9798 0.7495 16.3307 18.1849 18.7909 17.7973 

010100 h ........................................................................... 1.6637 0.8089 19.8146 20.0027 21.2915 20.4113 

010101 ............................................................................. 1.1105 0.7702 19.0718 21.0085 21.6593 20.5878 

010102 ............................................................................. 0.8953 0.7495 16.4637 19.9196 21.0903 19.1526 

010103 ............................................................................. 1.8475 0.8979 22.5709 24.2201 26.1163 24.2529 

010104 ............................................................................. 1.7281 0.8979 20.9391 24.1929 24.9226 23.2581 

010108 ............................................................................. 1.0770 0.8600 20.7787 23.7803 28.4624 24.2639 

010109 ............................................................................. 0.9471 0.7495 18.2235 21.7128 21.7997 20.5179 

010110 ............................................................................. 0.7216 0.7495 16.0015 19.2706 18.6633 18.1283 

010112 ............................................................................. 0.9699 0.7495 17.9243 17.2963 16.8902 17.3960 

010113 ............................................................................. 1.6431 0.7902 19.4106 20.4181 21.4209 20.4385 

010114 ............................................................................. 1.3235 0.8979 20.1763 21.5319 22.3431 21.3345 

010115 ............................................................................. 0.8225 0.7495 15.7872 17.5985 29.1465 19.5466 

010118 ............................................................................. 1.2436 0.8276 19.5302 18.8560 19.7673 19.4467 

010119 ............................................................................. *** * 20.5245 21.8215 * 21.1743 

010120 ............................................................................. 0.9483 0.7902 19.4368 20.5855 20.9450 20.3424 

010121 ............................................................................. *** * 17.1640 17.0329 24.0867 18.5589 

010125 ............................................................................. 1.0257 0.7495 16.8622 16.8419 18.4114 17.3762 

010126 ............................................................................. 1.1015 0.8276 19.9647 23.1856 23.1381 22.1149 

010128 ............................................................................. 0.8325 0.7495 14.7646 17.9354 21.4201 18.0579 

010129 h ........................................................................... 0.9813 0.7902 16.4905 18.7821 21.3555 19.1436 

010130 ............................................................................. 0.9433 0.8979 18.7190 18.4944 23.2488 20.0658 

010131 ............................................................................. 1.3281 0.9124 22.9969 24.2197 25.7837 24.4029 

010134 ............................................................................. *** 0.7495 17.7717 * * 17.7717 

010138 ............................................................................. 0.6035 0.7495 14.2025 13.5082 13.8475 13.8713 

010139 ............................................................................. 1.5206 0.8979 22.8390 24.9410 25.3014 24.4108 

010143 ............................................................................. 1.1648 0.8872 20.5639 22.1312 22.0215 21.5734 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23485 

TABLE 2.—HOSPITAL CASE-MIX INDEXES FOR DISCHARGES OCCURRING IN FEDERAL FISCAL YEAR 2004; HOSPITAL AVERAGE HOURLY WAGE FOR FEDERAL FISCAL YEARS 2004 (2000 WAGE DATA), 2005 (2001 WAGE DATA), AND 2006 

(2002 WAGE DATA) WAGE INDEXES AND 3-YEAR AVERAGE OF HOSPITAL AVERAGE HOURLY WAGES—Continued 

Provider number Case-mix 

index 

Wage index 

FY 2006 

Average 

hourly wage 

FY 2004 

Average 

hourly wage 

FY 2005 

Average 

hourly wage 

FY 2006 

Average 

hourly 

wage ** 

(3 years) 

010144 ............................................................................. 1.5626 0.7902 19.1497 20.6425 20.7433 20.2040 

010145 ............................................................................. 1.2572 0.8724 22.1394 23.1976 25.1442 23.5267 

010146 ............................................................................. 1.0392 0.7702 21.3083 19.9944 20.8917 20.7213 

010148 ............................................................................. 0.8756 0.7495 17.6829 18.5309 20.5294 19.0227 

010149 ............................................................................. 1.3179 0.8600 21.0086 23.1593 26.5854 23.4663 

010150 ............................................................................. 1.0456 0.7495 21.2360 20.6738 21.6377 21.1783 

010152 ............................................................................. 1.1957 0.7902 21.6038 22.1626 22.6202 22.1446 

010157 ............................................................................. 1.1130 0.8305 19.6977 21.3574 24.3560 21.7462 

010158 ............................................................................. 1.0822 0.8517 18.5464 22.4440 24.3531 21.6528 

010161 ............................................................................. *** * * 27.5119 * 27.5119 

020001 ............................................................................. 1.6973 1.2110 30.1452 31.6091 33.6407 31.9031 

020004 ............................................................................. 1.1807 1.1977 27.3516 29.9926 32.0966 29.8229 

020005 ............................................................................. 0.9509 1.1977 32.7936 * * 32.7936 

020008 ............................................................................. 1.2368 1.1977 33.4543 34.5856 35.9236 34.6652 

020010 ............................................................................. *** 1.1977 20.7929 * * 20.7929 

020013 ............................................................................. *** 1.1977 30.6423 * * 30.6423 

020017 ............................................................................. 1.9426 1.2110 30.3017 32.9281 33.5852 32.3606 

020024 ............................................................................. 1.1382 1.1977 28.0930 27.9799 33.0644 29.9221 

030001 ............................................................................. 1.3278 1.0139 25.7513 27.7572 29.9840 27.8499 

030002 ............................................................................. 2.0596 1.0139 25.6038 27.9628 29.0519 27.5075 

030003 ............................................................................. *** * 22.1436 * * 22.1436 

030007 ............................................................................. 1.3390 0.8991 26.1551 26.9442 29.6174 27.6578 

030009 ............................................................................. 0.8821 0.9007 19.9131 21.4065 22.3992 21.1294 

030010 ............................................................................. 1.3277 0.9007 20.7204 22.8647 24.8275 22.8055 

030011 ............................................................................. 1.4456 0.9007 21.0028 22.8422 25.1361 23.0075 

030012 ............................................................................. 1.2863 0.9884 24.2366 25.5205 26.3859 25.4550 

030013 ............................................................................. 1.3235 0.9102 21.9766 23.5229 25.7050 23.8047 

030014 ............................................................................. 1.4420 1.0139 23.3663 25.1189 25.6259 24.7232 

030016 ............................................................................. 1.2336 1.0139 24.3380 27.1583 26.7003 26.0910 

030017 ............................................................................. 1.9999 1.0139 21.8792 24.4055 26.2452 24.0378 

030018 ............................................................................. 1.2176 1.0139 24.9216 24.4308 28.9476 25.9371 

030019 ............................................................................. 1.3058 1.0139 23.2973 28.4917 27.3156 26.2053 

030022 ............................................................................. 1.5630 1.0139 24.9941 25.1461 26.4404 25.5437 

030023 ............................................................................. 1.6295 1.2094 28.6627 28.4112 33.8333 30.2808 

030024 ............................................................................. 1.9347 1.0139 26.7641 28.3470 31.6658 28.9293 

030027 ............................................................................. 0.9159 0.8991 19.4583 21.0527 20.4031 20.3074 

030030 ............................................................................. 1.6344 1.0139 25.2425 24.6005 30.2712 26.5838 

030033 ............................................................................. 1.1959 1.1713 26.3814 26.6009 26.6531 26.5511 

030036 ............................................................................. 1.3185 1.0139 24.9432 26.5708 30.3521 27.3868 

030037 ............................................................................. 2.1135 1.0139 23.0542 30.3907 28.6453 27.0409 

030038 ............................................................................. 1.5694 1.0139 25.2632 26.5178 29.5509 27.6724 

030040 ............................................................................. 0.9316 0.8991 21.2717 22.5130 24.8145 22.8703 

030043 ............................................................................. 1.3135 0.8991 23.5172 26.0825 24.7932 24.8113 

030044 ............................................................................. 0.8987 0.8991 21.9503 19.5714 * 20.6512 

030055 h ........................................................................... 1.3518 1.1416 22.8612 23.1837 24.5202 23.5684 

030059 ............................................................................. *** * * 24.7676 * 24.7676 

030060 ............................................................................. 1.1006 0.8991 21.7685 22.3551 24.3523 22.7950 

030061 ............................................................................. 1.6076 1.0139 22.9706 23.4722 25.5529 24.0363 

030062 ............................................................................. 1.1689 0.8991 21.1639 21.9849 23.8068 22.3433 

030064 ............................................................................. 1.9175 0.9007 22.8009 24.6732 25.4922 24.2954 

030065 ............................................................................. 1.5581 1.0139 24.6064 25.6738 27.1646 25.8836 

030067 ............................................................................. 1.0095 0.8991 18.4003 19.1332 20.4376 19.2370 

030068 ............................................................................. 1.0906 0.8991 19.7097 19.7030 20.8846 20.1346 

030069 h ........................................................................... 1.3425 1.1416 24.5432 25.6243 26.3518 25.5167 

030080 ............................................................................. 1.5124 0.9007 22.8953 24.3573 25.2077 24.1500 

030083 ............................................................................. 1.2683 1.0139 24.3273 24.9269 27.5353 25.6343 

030085 ............................................................................. 1.5138 0.9007 21.8196 23.2070 24.5792 23.3008 

030087 ............................................................................. 1.5725 1.0139 25.6351 26.3878 26.6594 26.2197 

030088 ............................................................................. 1.3763 1.0139 23.5761 23.2478 26.6796 24.5472 

030089 ............................................................................. 1.5398 1.0139 24.5055 26.2166 27.1835 26.0965 

030092 ............................................................................. 1.3775 1.0139 24.0515 25.4127 27.3203 25.7452 

030093 ............................................................................. 1.2260 1.0139 23.2485 23.5623 25.8955 24.3686 

030094 ............................................................................. 1.3354 1.0139 24.5992 26.9985 29.5948 27.0516 

030099 ............................................................................. 0.8991 0.8991 20.3310 26.7996 26.3236 24.0344 

030100 ............................................................................. 1.9686 0.9007 27.6299 * 29.0691 28.4177 

030101 h ........................................................................... 1.3930 1.1416 23.7661 25.0077 26.1927 25.0150 

030102 ............................................................................. 2.4590 1.0139 27.9419 * 29.0942 28.5553 

23486 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

TABLE 2.—HOSPITAL CASE-MIX INDEXES FOR DISCHARGES OCCURRING IN FEDERAL FISCAL YEAR 2004; HOSPITAL AVERAGE HOURLY WAGE FOR FEDERAL FISCAL YEARS 2004 (2000 WAGE DATA), 2005 (2001 WAGE DATA), AND 2006 

(2002 WAGE DATA) WAGE INDEXES AND 3-YEAR AVERAGE OF HOSPITAL AVERAGE HOURLY WAGES—Continued 

Provider number Case-mix 

index 

Wage index 

FY 2006 

Average 

hourly wage 

FY 2004 

Average 

hourly wage 

FY 2005 

Average 

hourly wage 

FY 2006 

Average 

hourly 

wage ** 

(3 years) 

030103 ............................................................................. 1.6379 1.0139 29.1105 28.2832 30.1994 29.2117 

030104 ............................................................................. *** * 34.6028 * * 34.6028 

030106 ............................................................................. 1.5145 1.0139 * 30.4791 34.7222 32.1177 

040001 ............................................................................. 1.0582 0.8615 18.7141 23.1475 23.7718 21.8056 

040002 ............................................................................. 1.1265 0.7478 18.0776 19.3429 20.1384 19.2037 

040003 ............................................................................. 1.0545 0.7478 16.3918 18.5000 * 17.3854 

040004 ............................................................................. 1.5197 0.8615 21.2335 23.3504 25.0286 23.2843 

040007 ............................................................................. 1.6581 0.8768 23.3992 23.4565 25.7142 24.1728 

040010 ............................................................................. 1.3488 0.8615 20.7114 22.0984 23.0274 21.9856 

040011 ............................................................................. 1.0063 0.7478 18.8346 19.0319 17.9740 18.5849 

040014 ............................................................................. 1.3420 0.8552 22.4970 24.0846 25.3451 23.9535 

040015 ............................................................................. 1.0378 0.7478 18.8513 18.0793 19.2831 18.7435 

040016 ............................................................................. 1.6546 0.8768 21.2198 22.7219 22.1228 22.0244 

040017 ............................................................................. 1.0968 0.8251 17.7545 19.4365 21.9875 19.7066 

040018 ............................................................................. 0.9839 0.8231 22.0408 23.8515 23.6044 23.2404 

040019 ............................................................................. 1.1290 0.9108 21.1711 21.5316 23.7328 22.1722 

040020 ............................................................................. 1.5076 0.9108 18.6419 20.9136 21.6603 20.4199 

040021 ............................................................................. 1.2489 0.8768 23.5620 24.7771 25.6917 24.7363 

040022 ............................................................................. 1.6031 0.8615 21.4194 23.7462 25.3039 23.4686 

040024 ............................................................................. 1.0523 0.7478 17.5750 20.1101 * 18.8371 

040026 ............................................................................. 1.4887 0.9066 22.7699 24.3053 25.4072 24.2169 

040027 ............................................................................. 1.3418 0.8251 19.3388 19.9348 21.1412 20.1077 

040029 ............................................................................. 1.5379 0.8768 22.1882 22.8770 24.0704 23.0869 

040032 ............................................................................. 0.9581 0.7478 16.2781 18.5171 * 17.4291 

040035 ............................................................................. 0.9080 0.7478 11.8237 13.4265 * 12.6475 

040036 ............................................................................. 1.5682 0.8768 21.6742 24.2851 26.3226 24.0976 

040039 ............................................................................. 1.3369 0.7793 15.9673 17.7976 19.5998 17.8170 

040041 ............................................................................. 1.1827 0.8552 20.4646 22.0188 22.1531 21.5535 

040042 ............................................................................. 1.3549 0.9346 16.2285 18.9550 19.9627 18.3286 

040045 ............................................................................. 0.9321 0.7478 19.5572 18.7952 17.6742 18.6280 

040047 ............................................................................. 1.0748 0.7793 21.6323 21.5334 21.9163 21.6924 

040050 ............................................................................. 1.0797 0.7478 15.1428 15.4782 16.3930 15.6589 

040051 ............................................................................. 0.9177 0.7478 17.6964 18.8943 19.1401 18.6103 

040053 ............................................................................. 0.9720 0.7478 19.2586 20.8153 20.7824 20.2863 

040054 ............................................................................. 1.0287 0.7478 16.5573 16.7370 18.2684 17.1740 

040055 ............................................................................. 1.5474 0.8231 19.7336 22.2237 23.3156 21.7960 

040062 ............................................................................. 1.5855 0.8231 21.9336 21.6403 23.1543 22.2707 

040066 ............................................................................. 1.0396 0.7478 21.7766 23.4616 * 22.6592 

040067 ............................................................................. 1.0244 0.7478 16.0516 15.1441 16.8799 16.0038 

040069 ............................................................................. 1.0357 0.9108 20.5968 21.7607 24.4662 22.2668 

040071 ............................................................................. 1.5128 0.8552 19.4324 22.9350 24.3824 22.1870 

040072 ............................................................................. 1.0728 0.8552 19.3079 20.8269 19.9009 19.9951 

040074 ............................................................................. 1.1860 0.8768 22.0800 22.6147 25.2423 23.2187 

040075 ............................................................................. 0.9521 0.7478 15.7875 16.2583 18.3254 17.1733 

040076 ............................................................................. 1.0208 0.8552 23.5947 21.0442 20.6272 21.3785 

040077 ............................................................................. 0.9549 0.7478 16.7832 18.3261 17.1210 17.3842 

040078 ............................................................................. 1.5395 0.8552 21.4854 24.4589 24.5378 23.4806 

040080 ............................................................................. 0.9908 0.7793 18.4470 21.3483 22.3392 20.6867 

040081 ............................................................................. 0.8047 0.7478 13.2797 13.7148 15.1081 14.0348 

040084 ............................................................................. 1.0773 0.8768 20.1163 22.6441 24.7225 22.5619 

040085 ............................................................................. 0.9955 0.7478 15.5811 18.0756 29.8444 19.6100 

040088 ............................................................................. 1.3084 0.8767 20.0032 21.2974 22.6183 21.3215 

040091 ............................................................................. 1.1599 0.8293 20.6688 23.0252 23.0080 22.2365 

040100 ............................................................................. 1.3376 0.8552 17.8889 19.3560 20.0460 19.1639 

040105 ............................................................................. 1.0117 0.7478 15.4697 15.8171 18.2182 16.4079 

040107 ............................................................................. 0.7276 0.7478 17.6695 * * 17.6695 

040114 ............................................................................. 1.7030 0.8768 21.6849 23.5628 24.8992 23.4046 

040118 ............................................................................. 1.4016 0.7968 21.7913 24.2547 24.7363 23.6447 

040119 ............................................................................. 1.4402 0.8552 19.9013 20.1631 21.0103 20.3637 

040126 ............................................................................. 0.8718 0.7478 13.3832 12.5944 14.0701 13.3074 

040132 ............................................................................. *** * 29.2343 36.5525 28.1390 31.3524 

040134 ............................................................................. 2.4142 0.8768 24.4646 * 27.3412 25.9794 

040137 ............................................................................. 1.1908 0.8768 24.7813 23.4672 25.2907 24.5263 

040138 ............................................................................. 1.2572 0.8615 22.3523 23.3615 25.7513 23.9295 

040140 ............................................................................. *** * * 25.1224 * 25.1224 

040141 ............................................................................. 0.7691 0.8615 * * 24.0901 24.0901 

040142 ............................................................................. 1.2882 0.9066 * * 27.9695 27.9695 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23487 

TABLE 2.—HOSPITAL CASE-MIX INDEXES FOR DISCHARGES OCCURRING IN FEDERAL FISCAL YEAR 2004; HOSPITAL AVERAGE HOURLY WAGE FOR FEDERAL FISCAL YEARS 2004 (2000 WAGE DATA), 2005 (2001 WAGE DATA), AND 2006 

(2002 WAGE DATA) WAGE INDEXES AND 3-YEAR AVERAGE OF HOSPITAL AVERAGE HOURLY WAGES—Continued 

Provider number Case-mix 

index 

Wage index 

FY 2006 

Average 

hourly wage 

FY 2004 

Average 

hourly wage 

FY 2005 

Average 

hourly wage 

FY 2006 

Average 

hourly 

wage ** 

(3 years) 

050002 ............................................................................. 1.3621 1.5474 30.9729 31.9709 34.1948 32.4064 

050006 ............................................................................. 1.6269 1.1909 25.4604 27.6176 30.5373 27.9248 

050007 ............................................................................. 1.4885 1.4970 34.1406 37.5804 38.7033 36.8959 

050008 ............................................................................. 1.3528 1.4970 32.4067 36.9371 39.1539 36.3445 

050009 ............................................................................. 1.7971 1.3955 30.2740 35.5384 39.6393 35.2947 

050013 ............................................................................. 2.0269 1.3955 29.8401 31.7637 31.9837 31.2570 

050014 ............................................................................. 1.1326 1.2953 27.7646 29.5726 33.0373 30.2311 

050015 ............................................................................. 1.2904 1.0848 27.5652 30.1398 30.7940 29.4852 

050016 ............................................................................. 1.2223 1.1357 25.5508 25.5735 26.2162 25.7788 

050017 ............................................................................. 1.9454 1.2953 28.4911 30.5863 36.8978 31.9726 

050018 ............................................................................. 1.1521 1.1762 17.9621 20.3179 22.3472 20.1629 

050022 ............................................................................. 1.5867 1.1297 28.1312 28.2773 29.8632 28.8610 

050024 ............................................................................. 1.0894 1.1417 25.1425 26.9378 27.5587 26.6747 

050025 ............................................................................. 1.8083 1.1417 29.8262 31.7242 36.1622 32.6605 

050026 ............................................................................. 1.5241 1.1417 24.2564 26.6406 28.3027 26.5474 

050028 ............................................................................. 1.2262 1.0848 18.7866 21.5448 26.6160 21.9931 

050029 ............................................................................. *** * 30.2538 34.3934 * 31.9320 

050030 ............................................................................. 1.2312 1.0848 21.9251 22.9148 24.9707 23.2719 

050032 ............................................................................. *** * 28.8046 * * 28.8046 

050038 ............................................................................. 1.5479 1.5114 36.1619 35.0441 38.7527 36.6692 

050039 ............................................................................. 1.6010 1.0848 26.8993 29.8179 31.6734 29.4369 

050040 ............................................................................. 1.2018 1.1762 30.7426 31.8983 32.7413 31.8084 

050042 ............................................................................. 1.3668 1.1909 27.6765 29.8062 33.9415 30.4516 

050043 ............................................................................. 1.6285 1.5474 37.3217 39.6054 43.1589 40.0134 

050045 ............................................................................. 1.2751 1.0848 22.1691 22.7051 23.8408 22.8906 

050046 ............................................................................. 1.2116 1.1660 25.5490 25.2786 25.6875 25.5104 

050047 ............................................................................. 1.7028 1.4970 34.4427 39.3993 40.9874 38.4201 

050054 ............................................................................. 1.1776 1.1297 21.3495 27.1437 24.1262 24.0051 

050055 ............................................................................. 1.2386 1.4970 36.1182 36.9386 37.5879 36.9364 

050056 ............................................................................. 1.3348 1.1762 27.1458 29.4829 27.9330 28.1647 

050057 ............................................................................. 1.6190 1.0848 24.2759 26.2099 29.4351 26.6650 

050058 ............................................................................. 1.5358 1.1762 25.9389 27.3584 33.8215 29.0264 

050060 ............................................................................. 1.4954 1.0848 22.9491 26.5515 27.3282 25.6824 

050061 ............................................................................. 0.8559 1.1525 25.3042 * 32.2172 28.5425 

050063 ............................................................................. 1.3227 1.1762 28.6093 32.0515 33.3039 31.3845 

050065 ............................................................................. 1.7399 1.1660 28.8369 33.8223 34.0280 32.3405 

050067 ............................................................................. 1.2228 1.1885 27.8867 29.6982 31.9597 29.7844 

050068 ............................................................................. *** * 21.9031 * * 21.9031 

050070 ............................................................................. 1.2848 1.4970 39.5178 40.5645 45.3382 41.9509 

050071 ............................................................................. 1.3395 1.5474 40.1344 41.1036 45.3882 42.3609 

050072 ............................................................................. 1.3403 1.5474 39.2529 40.8108 44.2651 41.6223 

050073 ............................................................................. 1.3622 1.5474 38.6763 41.3430 45.9765 42.1975 

050075 ............................................................................. 1.2439 1.5474 40.2265 43.7101 47.2356 44.0053 

050076 ............................................................................. 2.0351 1.5474 40.8075 43.0845 46.4990 43.5903 

050077 ............................................................................. 1.6700 1.1417 27.1234 29.6264 32.0245 29.6181 

050078 ............................................................................. 1.2906 1.1762 24.1091 25.6814 27.9269 25.7615 

050079 ............................................................................. 1.4307 1.5474 38.8981 42.7385 47.8597 43.4884 

050082 ............................................................................. 1.6699 1.1660 27.5022 28.9139 37.7783 31.5037 

050084 ............................................................................. 1.5479 1.1333 26.0607 28.2664 33.0179 29.0525 

050088 ............................................................................. *** 1.1357 27.1103 26.4093 25.7385 26.4472 

050089 ............................................................................. 1.3648 1.1660 24.7857 29.4884 33.5323 29.3416 

050090 ............................................................................. 1.2969 1.4739 27.4193 31.1774 32.9584 30.4520 

050091 ............................................................................. 1.1034 1.1762 29.2522 30.1534 30.8560 30.1209 

050093 ............................................................................. 1.5128 1.0848 29.2642 31.1083 33.4119 31.3614 

050096 ............................................................................. 1.3036 1.1762 23.0525 24.2277 24.6680 23.9648 

050097 ............................................................................. *** * 24.6726 26.6788 * 25.5991 

050099 ............................................................................. 1.5210 1.1660 27.1282 28.7711 31.0437 29.0188 

050100 ............................................................................. 1.7200 1.1417 25.6798 28.0303 29.6949 27.8627 

050101 ............................................................................. 1.2944 1.4888 32.9866 35.4655 39.5330 36.1079 

050102 ............................................................................. 1.3036 1.1297 25.5763 24.9381 29.1364 26.2832 

050103 ............................................................................. 1.5463 1.1762 27.8079 28.7375 34.2529 30.2688 

050104 ............................................................................. 1.4057 1.1762 26.1592 29.1240 29.7326 28.3301 

050107 ............................................................................. 1.3890 1.1525 22.6900 27.6002 33.1358 27.7768 

050108 ............................................................................. 1.9703 1.2953 28.5244 31.4271 35.5711 32.0693 

050110 ............................................................................. 1.2602 1.1525 21.9297 20.0769 22.4428 21.4435 

050111 ............................................................................. 1.2835 1.1762 23.7715 26.6345 28.1588 26.1803 

050112 ............................................................................. 1.5361 1.1762 31.9797 34.0258 36.8026 34.4310 

23488 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

TABLE 2.—HOSPITAL CASE-MIX INDEXES FOR DISCHARGES OCCURRING IN FEDERAL FISCAL YEAR 2004; HOSPITAL AVERAGE HOURLY WAGE FOR FEDERAL FISCAL YEARS 2004 (2000 WAGE DATA), 2005 (2001 WAGE DATA), AND 2006 

(2002 WAGE DATA) WAGE INDEXES AND 3-YEAR AVERAGE OF HOSPITAL AVERAGE HOURLY WAGES—Continued 

Provider number Case-mix 

index 

Wage index 

FY 2006 

Average 

hourly wage 

FY 2004 

Average 

hourly wage 

FY 2005 

Average 

hourly wage 

FY 2006 

Average 

hourly 

wage ** 

(3 years) 

050113 ............................................................................. 1.2729 1.4970 32.6932 34.2851 33.8064 33.6092 

050114 ............................................................................. 1.3830 1.1762 28.1938 29.2858 31.1294 29.5973 

050115 ............................................................................. 1.4364 1.1417 24.1481 27.5207 30.9288 27.6106 

050116 ............................................................................. 1.5151 1.1762 28.2924 28.8193 34.5110 30.5901 

050117 ............................................................................. 1.2630 1.1123 24.7555 28.2227 32.4414 28.3268 

050118 ............................................................................. 1.1710 1.1885 28.9358 33.0650 35.4044 32.6634 

050121 ............................................................................. 1.3350 1.0848 25.0858 25.5962 27.9537 26.3210 

050122 ............................................................................. 1.5372 1.1333 29.1534 29.7629 34.2416 31.1709 

050124 ............................................................................. 1.2385 1.1762 23.0843 26.7065 28.0288 25.9680 

050125 ............................................................................. 1.3685 1.5114 35.6573 40.9218 41.7020 39.5040 

050126 ............................................................................. 1.3912 1.1762 27.7126 29.6203 26.4194 27.8473 

050127 ............................................................................. 1.3401 1.2953 21.8719 23.6208 26.0500 23.7297 

050128 ............................................................................. 1.5403 1.1417 28.7668 28.3278 31.0662 29.4553 

050129 ............................................................................. 1.7571 1.1660 25.2780 27.8488 32.2680 28.7272 

050131 ............................................................................. 1.2972 1.4970 37.7845 38.6834 40.5321 39.0707 

050132 ............................................................................. 1.4262 1.1762 27.8805 29.4317 35.1544 30.7495 

050133 ............................................................................. 1.4967 1.0951 25.1948 27.6030 31.3530 28.2112 

050135 ............................................................................. 0.9765 1.1762 * 24.9415 24.3927 24.6796 

050136 ............................................................................. 1.2106 1.4739 31.6146 35.2834 37.4560 34.8123 

050137 ............................................................................. 1.2468 1.1762 35.0503 36.5409 38.4827 36.7225 

050138 ............................................................................. 1.9167 1.1762 43.0858 43.8671 46.9557 44.6742 

050139 ............................................................................. 1.2908 1.1762 33.8749 35.1013 37.6217 35.5604 

050140 ............................................................................. 1.4660 1.1660 36.1708 37.5473 39.6269 37.8550 

050144 ............................................................................. 1.4053 1.1762 30.3679 32.4042 33.5109 32.1636 

050145 ............................................................................. 1.3142 1.4140 37.5722 39.5676 42.3134 39.8846 

050148 ............................................................................. 1.1060 1.0848 17.3908 24.7063 27.3005 22.6027 

050149 ............................................................................. 1.4351 1.1762 28.0500 30.1596 33.2270 30.4737 

050150 ............................................................................. 1.1785 1.2953 26.7728 31.5333 31.7560 29.9321 

050152 ............................................................................. 1.4009 1.4970 34.5694 40.3464 43.6487 39.6060 

050153 ............................................................................. 1.5352 1.5114 34.5870 40.4446 43.3190 39.3912 

050155 ............................................................................. 0.9838 1.1762 21.2068 21.8829 21.8550 21.6128 

050158 ............................................................................. 1.2377 1.1762 30.6598 33.6400 35.1326 33.3121 

050159 ............................................................................. 1.3232 1.1660 27.4051 30.8069 31.3199 29.8120 

050167 ............................................................................. 1.3635 1.1333 23.2022 25.9850 28.5179 25.9911 

050168 ............................................................................. 1.6244 1.1660 27.5313 30.8036 33.2506 30.5684 

050169 ............................................................................. 1.4269 1.1762 25.6896 26.2864 27.4644 26.5104 

050170 ............................................................................. *** * 29.4075 * * 29.4075 

050173 ............................................................................. 1.2514 1.1660 27.7070 27.6097 30.3582 28.5541 

050174 ............................................................................. 1.6425 1.4739 33.5204 36.3117 40.1747 36.7717 

050175 ............................................................................. 1.2918 1.1762 26.9627 31.5615 30.5733 29.6977 

050177 ............................................................................. 1.2491 1.1660 23.1575 24.7531 25.1442 24.3743 

050179 ............................................................................. 1.2005 1.1885 23.0583 25.8072 27.1155 25.4092 

050180 ............................................................................. 1.5845 1.5474 36.9905 40.8101 39.8123 39.2517 

050186 ............................................................................. *** * 27.6638 * * 27.6638 

050189 ............................................................................. 0.9939 1.4140 32.3513 20.0709 29.1280 26.2226 

050191 ............................................................................. 1.4343 1.1762 28.1689 * 34.2091 31.2052 

050192 ............................................................................. 0.9731 1.0848 19.5327 21.2448 27.0424 22.7189 

050193 ............................................................................. 1.1968 1.1660 24.6307 30.7341 29.6421 28.4881 

050194 ............................................................................. 1.3119 1.5159 28.1413 38.6750 40.9096 35.6972 

050195 ............................................................................. 1.5170 1.5474 42.1735 43.9696 48.4358 44.9294 

050196 ............................................................................. 1.0762 1.0848 20.7257 25.2168 32.1933 25.8088 

050197 ............................................................................. 1.9645 1.4970 * 40.8832 48.9052 44.8389 

050204 ............................................................................. 1.4068 1.1762 24.9458 25.2512 28.6423 26.2829 

050205 ............................................................................. 1.2244 1.1762 25.2841 28.0504 27.8611 27.0700 

050207 ............................................................................. 1.2714 1.0951 25.1863 27.0216 29.5215 27.2272 

050211 ............................................................................. 1.2713 1.5474 34.3396 38.3319 41.2166 37.8840 

050214 ............................................................................. *** 1.1762 22.4773 24.4785 23.9972 23.6229 

050215 ............................................................................. 1.6351 1.5114 36.6063 41.6886 43.7985 40.7257 

050217 ............................................................................. 1.1451 1.0848 22.2055 23.6286 24.9606 23.6369 

050219 ............................................................................. 1.0993 1.1762 21.8649 22.9226 22.4065 22.4391 

050222 ............................................................................. 1.6663 1.1417 25.2922 26.3882 29.1094 27.0242 

050224 ............................................................................. 1.7203 1.1660 26.2108 26.7916 29.3143 27.4653 

050225 ............................................................................. 1.5203 1.0848 25.0219 29.5184 29.9656 28.1785 

050226 ............................................................................. 1.5875 1.1660 26.0826 29.2259 30.6541 28.6959 

050228 ............................................................................. 1.3521 1.5474 38.6751 40.1362 42.4226 40.4482 

050230 ............................................................................. 1.3593 1.1660 30.0380 34.1417 32.9555 32.4641 

050231 ............................................................................. 1.6236 1.1762 27.8896 30.1298 30.9607 29.7082 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23489 

TABLE 2.—HOSPITAL CASE-MIX INDEXES FOR DISCHARGES OCCURRING IN FEDERAL FISCAL YEAR 2004; HOSPITAL AVERAGE HOURLY WAGE FOR FEDERAL FISCAL YEARS 2004 (2000 WAGE DATA), 2005 (2001 WAGE DATA), AND 2006 

(2002 WAGE DATA) WAGE INDEXES AND 3-YEAR AVERAGE OF HOSPITAL AVERAGE HOURLY WAGES—Continued 

Provider number Case-mix 

index 

Wage index 

FY 2006 

Average 

hourly wage 

FY 2004 

Average 

hourly wage 

FY 2005 

Average 

hourly wage 

FY 2006 

Average 

hourly 

wage ** 

(3 years) 

050232 ............................................................................. 1.4386 1.1357 25.3439 24.4383 27.4099 25.6865 

050234 ............................................................................. 1.1726 1.1417 24.0754 29.2421 29.6560 27.4243 

050235 ............................................................................. 1.5578 1.1762 27.2838 27.8965 29.2979 28.1654 

050236 ............................................................................. 1.3813 1.1660 27.0687 28.1969 32.1647 29.0012 

050238 ............................................................................. 1.4440 1.1762 26.0312 29.1481 31.1764 28.8569 

050239 ............................................................................. 1.5765 1.1762 27.0866 28.2327 31.0963 28.8857 

050240 ............................................................................. 1.6442 1.1762 32.8542 35.2284 35.5735 34.6528 

050242 ............................................................................. 1.3378 1.5159 34.4412 39.7629 44.3130 39.6054 

050243 ............................................................................. 1.6214 1.1297 28.5626 31.8153 31.4883 30.6830 

050245 ............................................................................. 1.3020 1.1660 25.7585 27.0949 28.6527 27.2127 

050248 ............................................................................. 1.0286 1.4140 29.1192 31.6240 35.3864 32.0261 

050251 ............................................................................. 1.0004 1.0848 24.4552 26.5021 27.2675 26.0899 

050253 ............................................................................. *** 1.1564 23.9246 22.2450 24.0044 23.3808 

050254 ............................................................................. 1.2166 1.2953 23.3358 24.1512 26.3150 24.6804 

050256 ............................................................................. 1.5778 1.1762 26.8618 28.4728 29.8194 28.4077 

050257 ............................................................................. 0.9814 1.0848 17.4909 20.8367 21.3216 19.7770 

050261 ............................................................................. 1.3007 1.0848 21.4693 25.3005 27.3234 24.7145 

050262 ............................................................................. 2.1232 1.1762 33.0425 36.1162 44.0256 37.8981 

050264 ............................................................................. 1.3196 1.5474 37.4742 41.3478 41.1211 39.9496 

050267 ............................................................................. *** * 26.6558 26.7060 * 26.6806 

050270 ............................................................................. 1.3272 1.1417 27.9871 30.0540 32.4812 30.2697 

050272 ............................................................................. 1.3628 1.1660 24.0921 25.9103 27.1989 25.7666 

050276 ............................................................................. 1.1883 1.5474 34.7422 41.2251 39.3778 38.5361 

050277 ............................................................................. 1.0330 1.1762 35.6323 35.8246 32.5213 34.3014 

050278 ............................................................................. 1.5907 1.1762 26.0331 28.0351 29.9244 28.0988 

050279 ............................................................................. 1.2108 1.1660 23.5145 25.5299 27.6573 25.5685 

050280 ............................................................................. 1.6443 1.2207 28.5504 30.6723 35.2030 31.5494 

050281 ............................................................................. 1.4863 1.1762 25.7832 26.2623 27.3824 26.5030 

050283 ............................................................................. 1.5233 1.5474 35.1831 38.5600 42.8618 39.0003 

050286 ............................................................................. *** * 19.7352 19.4973 * 19.6057 

050289 ............................................................................. 1.5691 1.4970 34.9645 38.6875 41.1061 38.2220 

050290 ............................................................................. 1.6177 1.1762 31.9510 32.6388 34.5482 33.0758 

050291 ............................................................................. 1.8090 1.4739 28.3451 29.6162 35.3653 31.1027 

050292 ............................................................................. 0.9624 1.1297 27.6114 27.0775 26.8879 27.1685 

050295 ............................................................................. 1.5134 1.0848 25.4332 31.5960 36.1950 30.7774 

050296 ............................................................................. 1.1551 1.5114 33.5948 34.9952 39.0061 36.0343 

050298 ............................................................................. 1.1272 1.1660 26.1707 25.8232 27.7416 26.6026 

050299 ............................................................................. 1.2244 1.1762 26.9870 27.7535 31.5435 28.9060 

050300 ............................................................................. 1.5741 1.1660 26.3182 28.3862 30.7148 28.5022 

050301 ............................................................................. 1.2254 1.0848 25.7167 28.5769 31.9995 28.7858 

050305 ............................................................................. 1.4519 1.5474 38.7597 40.9978 44.8630 41.5654 

050308 ............................................................................. 1.4919 1.5114 31.6790 38.0564 43.0691 37.5162 

050309 ............................................................................. 1.3873 1.2953 25.5367 28.9181 34.4278 29.9079 

050312 ............................................................................. 1.4865 1.2207 28.2557 32.6846 33.9022 31.7615 

050313 ............................................................................. 1.2403 1.1333 25.3372 27.5321 31.4999 28.4222 

050315 ............................................................................. 1.2710 1.0848 23.6638 26.1224 27.6037 25.8181 

050320 ............................................................................. 1.2238 1.5474 31.4570 36.3252 40.2352 36.0082 

050324 ............................................................................. 1.9289 1.1417 28.4931 30.9958 32.9792 30.9355 

050325 ............................................................................. 1.1756 1.0848 26.6325 30.2280 30.6117 29.1581 

050327 ............................................................................. 1.6847 1.1660 33.0549 29.8327 33.0087 31.8986 

050329 ............................................................................. 1.2743 1.1297 26.6341 26.8021 26.2120 26.5339 

050331 ............................................................................. 1.1721 1.4739 21.5193 20.9847 20.2692 20.9637 

050333 ............................................................................. 1.0706 1.0848 15.6929 15.3119 23.4009 17.5306 

050334 ............................................................................. 1.6937 1.4140 37.2336 38.7635 40.7467 38.9455 

050335 ............................................................................. 1.4438 1.0848 24.9274 27.4046 26.2576 26.2253 

050336 ............................................................................. 1.1664 1.1333 23.2687 25.3062 28.5659 25.7519 

050342 ............................................................................. 1.2238 1.0848 23.0282 24.7654 26.8507 24.9581 

050348 ............................................................................. 1.6959 1.1660 28.9864 33.2676 37.7898 33.4975 

050349 ............................................................................. 0.9453 1.0848 15.6043 16.9251 17.4791 16.6299 

050350 ............................................................................. 1.3661 1.1762 27.2573 29.4262 31.1833 29.2715 

050351 ............................................................................. 1.5133 1.1762 27.4042 29.3082 30.8661 29.2314 

050352 ............................................................................. 1.2358 1.2953 32.6572 24.2931 33.9362 30.0053 

050353 ............................................................................. 1.5568 1.1762 25.4309 26.6332 29.1630 27.0686 

050355 ............................................................................. *** 1.0848 * 11.2498 5.0506 7.4928 

050357 ............................................................................. 1.4494 1.1525 25.2126 26.7265 32.3095 27.5322 

050359 ............................................................................. 1.1442 1.0848 22.9175 23.6030 24.7311 23.7960 

050360 ............................................................................. 1.4616 1.4970 35.9032 38.8658 37.0769 37.3332 

23490 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

TABLE 2.—HOSPITAL CASE-MIX INDEXES FOR DISCHARGES OCCURRING IN FEDERAL FISCAL YEAR 2004; HOSPITAL AVERAGE HOURLY WAGE FOR FEDERAL FISCAL YEARS 2004 (2000 WAGE DATA), 2005 (2001 WAGE DATA), AND 2006 

(2002 WAGE DATA) WAGE INDEXES AND 3-YEAR AVERAGE OF HOSPITAL AVERAGE HOURLY WAGES—Continued 

Provider number Case-mix 

index 

Wage index 

FY 2006 

Average 

hourly wage 

FY 2004 

Average 

hourly wage 

FY 2005 

Average 

hourly wage 

FY 2006 

Average 

hourly 

wage ** 

(3 years) 

050366 ............................................................................. 1.2256 1.0848 23.4696 25.7692 31.1854 26.8679 

050367 ............................................................................. 1.4438 1.4888 32.6760 34.4959 38.7604 35.6778 

050369 ............................................................................. 1.3974 1.1762 28.0909 27.1327 29.5697 28.2751 

050373 ............................................................................. 1.4860 1.1762 30.7301 32.2315 32.2596 31.7447 

050376 ............................................................................. 1.4575 1.1762 30.3530 30.7562 32.5870 31.2266 

050377 ............................................................................. *** * 14.3892 20.2484 * 16.9896 

050378 ............................................................................. 0.9702 1.1762 30.4937 33.9087 34.2417 32.8674 

050379 ............................................................................. *** 1.0848 27.5151 31.7645 32.9575 30.5157 

050380 ............................................................................. 1.5471 1.5114 35.8014 39.1098 42.0782 38.9514 

050382 ............................................................................. 1.4204 1.1762 26.8950 26.0927 27.4131 26.8049 

050385 ............................................................................. 1.3521 1.4739 * 25.5735 34.5184 29.9098 

050390 ............................................................................. 1.1788 1.1297 25.7881 28.7761 26.0066 26.7871 

050391 ............................................................................. 1.3048 1.1762 20.2887 21.3012 18.1004 19.7304 

050392 ............................................................................. 1.0187 1.0848 21.8139 22.7209 * 22.2790 

050393 ............................................................................. 1.3163 1.1762 26.4918 28.2369 30.0661 28.2139 

050394 ............................................................................. 1.4938 1.1660 25.1869 26.0074 27.2543 26.2043 

050396 ............................................................................. 1.5902 1.1525 28.4161 30.5470 33.5699 30.9065 

050397 ............................................................................. 0.8283 1.0848 24.7279 27.4716 28.1640 26.7356 

050407 ............................................................................. 1.1949 1.4970 33.2894 35.6035 37.9066 35.6609 

050410 ............................................................................. 0.9616 * 19.8436 19.4995 21.3814 20.2094 

050411 ............................................................................. 1.4055 1.1762 35.5207 37.3817 37.8064 36.9551 

050414 ............................................................................. 1.3026 1.2953 28.2381 28.8561 34.6532 30.6007 

050417 ............................................................................. 1.2841 1.0848 24.5360 25.2930 29.5031 26.5285 

050419 ............................................................................. 1.3330 1.1909 26.4357 28.4471 33.3125 29.3954 

050420 ............................................................................. 1.1285 1.1762 26.7537 26.1838 24.9401 25.8686 

050423 ............................................................................. 0.9475 1.1297 26.5188 28.5944 30.6416 28.6936 

050424 ............................................................................. 1.9635 1.1417 27.5273 29.9133 31.0730 29.4697 

050425 ............................................................................. 1.3899 1.2953 37.7347 38.5317 42.4177 39.7789 

050426 ............................................................................. 1.3183 1.1660 30.9610 30.0077 30.6899 30.5313 

050430 ............................................................................. 0.9585 1.0848 31.5170 24.6684 25.0607 26.4412 

050432 ............................................................................. 1.5149 1.1762 28.1105 30.3547 30.8030 29.8170 

050433 ............................................................................. 0.9214 1.0848 14.3846 20.7565 23.0806 19.1896 

050434 ............................................................................. 1.1299 1.0848 * 25.9506 26.1621 26.0550 

050435 ............................................................................. 1.0952 1.1417 22.6618 32.2183 28.0306 27.3138 

050438 ............................................................................. 1.5305 1.1762 26.5535 26.4668 27.2662 26.7804 

050441 ............................................................................. 1.9649 1.5114 36.6680 38.2823 42.9765 39.2937 

050444 ............................................................................. 1.3319 1.1123 23.5299 27.6971 30.5504 27.3177 

050447 ............................................................................. 0.8880 1.1417 25.7274 21.8552 25.2573 24.1974 

050448 ............................................................................. 1.1326 1.0848 26.6967 25.0983 27.9759 26.6380 

050454 ............................................................................. 1.8679 1.4970 34.4813 36.8383 43.3278 38.3744 

050455 ............................................................................. 1.6861 1.0848 24.1694 24.5314 21.8846 23.4157 

050456 ............................................................................. 1.2166 1.1762 23.7594 22.1675 22.5630 22.8117 

050457 ............................................................................. 1.6122 1.4970 37.4570 40.2725 45.5829 41.0011 

050464 ............................................................................. 1.6731 1.1885 31.4768 37.1342 37.3692 35.4838 

050468 ............................................................................. 1.4533 1.1762 17.8128 29.4280 29.5448 24.3346 

050469 ............................................................................. 1.0831 1.0848 25.7995 27.3281 28.9079 27.4122 

050470 ............................................................................. 1.0907 1.0848 21.6981 18.4689 23.6649 21.2384 

050471 ............................................................................. 1.7659 1.1762 32.3570 34.5484 34.5211 33.8184 

050476 ............................................................................. 1.3587 1.0848 26.0482 30.9974 34.6585 30.3567 

050477 ............................................................................. 1.4963 1.1762 32.1676 34.6400 34.6995 33.8960 

050478 ............................................................................. 0.9760 1.1525 28.3894 30.9865 33.3998 30.9361 

050481 ............................................................................. 1.4169 1.1762 30.3890 31.9177 33.7446 32.0928 

050485 ............................................................................. 1.5976 1.1762 27.1437 28.8459 31.4233 29.1407 

050488 ............................................................................. 1.3096 1.5474 37.2438 40.5313 42.9904 40.3037 

050491 ............................................................................. *** 1.1564 29.2987 30.6461 32.1379 30.5664 

050492 ............................................................................. 1.4025 1.0848 23.7384 27.4933 27.1540 26.2639 

050494 ............................................................................. 1.3712 1.0848 30.8706 35.1457 34.8963 33.6068 

050496 ............................................................................. 1.7798 1.5474 35.7115 38.2871 42.2672 38.6931 

050497 ............................................................................. *** * 14.4481 15.9501 * 15.1581 

050498 ............................................................................. 1.2871 1.2953 28.2196 28.2667 32.7708 29.8260 

050502 ............................................................................. 1.7452 1.1762 28.0102 28.7200 29.5615 28.8118 

050503 ............................................................................. 1.4596 1.1417 26.7924 29.2001 31.6418 29.3049 

050506 ............................................................................. 1.7058 1.1357 30.4731 32.4509 36.0164 33.1455 

050510 ............................................................................. 1.2059 1.5474 39.6005 44.3883 47.5510 44.1129 

050512 ............................................................................. 1.4016 1.5474 39.0767 41.8921 46.9233 42.8915 

050515 ............................................................................. 1.3200 1.1417 36.3131 37.4251 38.9978 37.6365 

050516 ............................................................................. 1.4489 1.2953 30.0985 29.4936 36.2618 31.8675 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23491 

TABLE 2.—HOSPITAL CASE-MIX INDEXES FOR DISCHARGES OCCURRING IN FEDERAL FISCAL YEAR 2004; HOSPITAL AVERAGE HOURLY WAGE FOR FEDERAL FISCAL YEARS 2004 (2000 WAGE DATA), 2005 (2001 WAGE DATA), AND 2006 

(2002 WAGE DATA) WAGE INDEXES AND 3-YEAR AVERAGE OF HOSPITAL AVERAGE HOURLY WAGES—Continued 

Provider number Case-mix 

index 

Wage index 

FY 2006 

Average 

hourly wage 

FY 2004 

Average 

hourly wage 

FY 2005 

Average 

hourly wage 

FY 2006 

Average 

hourly 

wage ** 

(3 years) 

050517 ............................................................................. 1.0642 1.1660 23.4131 23.6034 23.9007 23.6377 

050522 ............................................................................. *** * 38.9157 * * 38.9157 

050526 ............................................................................. 1.2090 1.1660 29.0004 29.9495 31.3744 30.1287 

050528 ............................................................................. 1.1389 1.0848 23.9177 28.6273 29.6838 27.7337 

050531 ............................................................................. 1.0915 1.1762 22.7311 25.0157 26.9420 24.9597 

050534 ............................................................................. 1.2648 1.1297 26.7941 29.7546 29.8603 28.8863 

050535 ............................................................................. 1.3449 1.1660 29.7904 32.3646 32.3723 31.6438 

050537 ............................................................................. 1.3781 1.2953 25.1291 27.4196 31.4527 28.1309 

050539 ............................................................................. 1.2398 1.0848 25.3328 28.0586 29.6856 27.7611 

050541 ............................................................................. 1.5362 1.5474 41.1980 43.7765 46.1121 43.8355 

050542 ............................................................................. 1.0327 1.0848 21.2846 * * 21.2846 

050545 ............................................................................. 0.6959 1.1762 33.4322 42.9451 30.5554 35.4562 

050546 ............................................................................. 0.7147 1.0848 42.8052 52.7180 30.2329 41.5266 

050547 ............................................................................. 0.8260 1.4739 40.6483 45.1842 33.2205 39.9154 

050548 ............................................................................. 0.7101 1.1660 32.3944 37.1314 * 34.6019 

050549 ............................................................................. 1.5565 1.1604 31.8525 33.8288 34.9818 33.6342 

050550 ............................................................................. 1.3762 1.1660 29.0938 31.1918 30.2302 30.2108 

050551 ............................................................................. 1.2853 1.1660 28.6834 31.6782 31.6165 30.7425 

050552 ............................................................................. 1.1118 1.1762 24.9755 26.8274 27.1744 26.5471 

050557 ............................................................................. 1.5548 1.1885 25.8719 28.3111 31.1871 28.6462 

050559 ............................................................................. *** * 25.3299 26.9662 * 26.0948 

050561 ............................................................................. 1.2178 1.1762 35.9611 37.5863 38.8651 37.5449 

050567 ............................................................................. 1.5865 1.1660 27.8475 30.1167 32.9829 30.4114 

050568 ............................................................................. 1.2251 1.0848 20.8324 22.5008 24.4061 22.5795 

050569 ............................................................................. 1.3462 1.3480 27.7955 30.4874 33.0259 30.5066 

050570 ............................................................................. 1.5162 1.1660 29.9470 32.6896 34.0171 32.2949 

050571 ............................................................................. 1.2578 1.1762 29.1716 32.1656 33.6156 31.7338 

050573 ............................................................................. 1.7100 1.1297 27.2328 30.5249 33.3268 30.3962 

050575 ............................................................................. 1.2597 1.1762 23.1358 23.2447 25.2513 23.9658 

050577 ............................................................................. 1.2157 1.1762 26.4806 28.7060 30.8841 28.7176 

050578 ............................................................................. 1.7450 1.1762 30.4934 31.5953 33.8825 31.9512 

050579 ............................................................................. 1.4291 1.1762 34.9794 40.2740 39.4976 38.3190 

050580 ............................................................................. 1.2595 1.1660 27.2431 29.4337 31.6256 29.3950 

050581 ............................................................................. 1.4452 1.1762 28.9696 32.0823 32.1801 31.1581 

050583 ............................................................................. 1.5670 1.1417 30.0427 33.5209 33.3697 32.3610 

050584 ............................................................................. 1.2914 1.1660 24.5544 24.5757 24.8180 24.6565 

050585 ............................................................................. 1.1457 1.1660 26.0595 27.2982 22.7121 24.9986 

050586 ............................................................................. 1.1583 1.1660 25.7172 25.3551 27.4173 26.0841 

050588 ............................................................................. 1.3347 1.1762 30.5453 32.3603 32.8212 31.9715 

050589 ............................................................................. 1.2362 1.1660 27.9845 30.6273 30.9547 29.9199 

050590 ............................................................................. 1.2814 1.2953 27.0620 31.5987 32.1654 30.1866 

050591 ............................................................................. 1.1623 1.1762 28.6151 28.5915 28.8549 28.6959 

050592 ............................................................................. 1.1716 1.1660 25.9545 32.5000 24.4542 27.4073 

050594 ............................................................................. 1.9876 1.1660 30.8028 34.6747 34.7946 33.5328 

050597 ............................................................................. 1.2330 1.1762 24.5542 25.4868 27.5691 25.8776 

050598 ............................................................................. *** * 24.6875 * * 24.6875 

050601 ............................................................................. 1.5414 1.1762 32.3033 35.0325 34.7409 34.0841 

050603 ............................................................................. 1.3839 1.1660 25.0996 28.6982 30.2464 28.0787 

050604 ............................................................................. 1.2162 1.5114 42.0018 45.4433 49.9429 45.9484 

050608 ............................................................................. 1.3821 1.0848 20.7955 22.1999 23.3630 22.1922 

050609 ............................................................................. 1.3707 1.1660 37.4563 38.4561 41.1797 39.1280 

050615 ............................................................................. 1.3061 1.1762 29.4323 32.8786 33.2909 31.8903 

050616 ............................................................................. 1.3796 1.1660 23.1748 28.5636 36.9017 29.6253 

050618 ............................................................................. 1.0245 1.0848 22.3481 25.4500 27.4539 25.0614 

050623 ............................................................................. *** 1.1762 29.9553 29.6550 32.0627 30.4768 

050624 ............................................................................. 1.2620 1.1762 23.3492 28.1941 32.2907 27.6796 

050625 ............................................................................. 1.7422 1.1762 30.8013 33.5137 36.3631 33.6260 

050630 ............................................................................. *** * 27.7051 28.0726 30.9410 28.9666 

050633 ............................................................................. 1.2315 1.1357 30.2883 33.4771 35.3734 33.1070 

050636 ............................................................................. 1.3084 1.1417 23.2573 27.2360 30.5156 27.0926 

050641 ............................................................................. 1.2243 1.1762 21.5030 20.4720 21.4612 21.1520 

050644 ............................................................................. 0.8876 1.1762 28.4054 25.6614 27.6547 27.1915 

050662 ............................................................................. 0.7678 1.5114 40.9242 47.5065 32.6362 40.4932 

050663 ............................................................................. 1.0263 1.1762 22.9161 25.1493 25.7747 24.4728 

050667 ............................................................................. 0.8884 1.3955 31.4906 25.9250 26.3937 27.9100 

050668 ............................................................................. 0.9981 1.5474 55.9594 * 31.8065 41.1707 

050674 ............................................................................. 1.2840 1.2953 36.8871 38.4454 42.6866 39.5960 

23492 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

TABLE 2.—HOSPITAL CASE-MIX INDEXES FOR DISCHARGES OCCURRING IN FEDERAL FISCAL YEAR 2004; HOSPITAL AVERAGE HOURLY WAGE FOR FEDERAL FISCAL YEARS 2004 (2000 WAGE DATA), 2005 (2001 WAGE DATA), AND 2006 

(2002 WAGE DATA) WAGE INDEXES AND 3-YEAR AVERAGE OF HOSPITAL AVERAGE HOURLY WAGES—Continued 

Provider number Case-mix 

index 

Wage index 

FY 2006 

Average 

hourly wage 

FY 2004 

Average 

hourly wage 

FY 2005 

Average 

hourly wage 

FY 2006 

Average 

hourly 

wage ** 

(3 years) 

050677 ............................................................................. 1.4811 1.1762 36.2702 37.3389 38.7984 37.5511 

050678 ............................................................................. 1.2324 1.1660 27.1337 29.1159 30.7220 29.1295 

050680 ............................................................................. 1.2133 1.4888 32.7065 35.6614 38.3946 35.9028 

050682 ............................................................................. 0.8920 1.0848 23.0984 21.7264 21.7791 22.0865 

050684 ............................................................................. 1.1341 1.1297 23.7443 25.2575 26.4234 25.2119 

050686 ............................................................................. 1.2605 1.1297 37.3033 38.5595 40.9486 39.0574 

050688 ............................................................................. 1.2096 1.5114 36.5555 41.3305 41.9325 39.9230 

050689 ............................................................................. 1.5618 1.5474 37.5449 40.3815 42.2018 40.1932 

050690 ............................................................................. 1.2343 1.4739 41.1385 43.9228 47.2769 44.3743 

050693 ............................................................................. 1.2978 1.1660 32.6638 34.8040 35.0621 34.2547 

050694 ............................................................................. 1.1914 1.1297 25.8298 26.7041 28.9544 27.1978 

050695 ............................................................................. 1.1012 1.1333 27.8742 30.1226 35.6549 31.4872 

050696 ............................................................................. 2.0751 1.1762 29.9410 36.9314 35.9220 34.4812 

050697 ............................................................................. 1.0277 1.2207 18.6962 19.2603 25.1984 20.8006 

050699 ............................................................................. *** * 26.0909 25.6818 26.8210 26.1958 

050701 ............................................................................. 1.2779 1.1297 28.4650 29.6896 29.6253 29.3536 

050704 ............................................................................. 1.0120 1.1762 24.6072 24.6609 25.3488 24.8998 

050707 ............................................................................. 1.3813 1.4970 27.7366 32.4877 34.0550 31.4563 

050708 ............................................................................. 1.6591 1.0848 22.1606 21.2163 22.5034 21.9751 

050709 ............................................................................. 1.2193 1.1660 22.7897 21.9079 25.6119 23.3937 

050710 ............................................................................. 1.4396 1.0848 33.7204 34.8311 39.9858 36.4647 

050713 ............................................................................. 1.2543 1.1762 19.0071 20.7448 20.2803 19.9969 

050714 ............................................................................. 1.3580 1.5159 30.3263 32.4491 33.6676 32.2064 

050717 ............................................................................. 1.0612 1.1762 33.0719 34.5519 38.0796 35.2375 

050718 ............................................................................. 1.0152 1.1297 21.7835 15.4037 21.4996 18.9377 

050719 ............................................................................. *** * 22.0998 * * 22.0998 

050723 ............................................................................. 1.2353 1.1762 33.0797 34.9814 35.0119 34.4384 

050724 ............................................................................. 2.1341 1.0848 23.7567 * 34.4267 28.5323 

050725 ............................................................................. 0.9684 1.1762 20.6592 22.0946 21.7816 21.6358 

050726 ............................................................................. 1.6664 1.1885 25.8742 27.0928 27.8433 27.0367 

050727 ............................................................................. 1.2727 1.1762 * 23.7179 23.9437 23.8301 

050728 ............................................................................. 1.3207 1.4739 * 31.4768 36.0820 33.6891 

050729 ............................................................................. 1.4238 1.1762 * * 34.2580 34.2580 

050730 ............................................................................. 1.2649 1.1762 * * 51.5425 51.5425 

060001 ............................................................................. 1.5772 1.0517 23.1548 24.9410 26.8470 25.0779 

060003 ............................................................................. 1.3962 1.0517 23.0807 24.7856 24.2224 24.0730 

060004 ............................................................................. 1.1960 1.0710 25.0037 28.0656 29.9649 27.8289 

060006 ............................................................................. 1.3423 0.9379 21.8609 22.7493 24.5704 23.0964 

060007 ............................................................................. 1.0128 0.9379 21.4244 21.4792 * 21.4535 

060008 ............................................................................. 1.1014 0.9379 19.8803 21.8037 23.3859 21.7601 

060009 ............................................................................. 1.4646 1.0710 24.7920 27.0511 28.7645 26.9116 

060010 ............................................................................. 1.7149 1.0146 25.8475 27.2290 28.9850 27.4402 

060011 ............................................................................. 1.4232 1.0710 25.8919 26.1958 27.2833 0126.4630 

060012 ............................................................................. 1.4557 0.9379 22.6374 24.1557 26.2469 24.3434 

060013 ............................................................................. 1.3659 0.9379 23.3954 24.9708 24.5994 24.0758 

060014 ............................................................................. 1.7846 1.0710 27.0326 29.6744 31.2588 29.2315 

060015 ............................................................................. 1.7206 1.0710 27.6338 30.1158 30.4533 29.4109 

060016 ............................................................................. 1.1655 0.9379 22.9300 23.9655 25.6527 24.2479 

060018 ............................................................................. 1.2136 0.9379 21.0581 23.6620 25.7628 23.4747 

060020 ............................................................................. 1.5388 0.9379 20.9025 22.2052 22.6748 21.9753 

060022 ............................................................................. 1.5930 0.9457 24.7928 25.7832 26.5238 25.7483 

060023 ............................................................................. 1.6438 0.9578 24.3749 26.7285 27.7644 26.3625 

060024 ............................................................................. 1.7403 1.0710 25.2409 28.7231 29.0130 27.7028 

060027 ............................................................................. 1.5666 1.0517 25.1480 26.6348 28.0909 26.7085 

060028 ............................................................................. 1.3838 1.0710 27.1303 27.9686 30.0448 28.4352 

060029 ............................................................................. *** 0.9379 19.7379 * * 19.7379 

060031 ............................................................................. 1.5393 0.9457 23.8781 25.6207 26.3650 25.3306 

060032 ............................................................................. 1.5419 1.0710 27.1783 28.2234 30.4247 28.6396 

060033 ............................................................................. 0.9865 0.9379 16.7266 * * 16.7266 

060036 ............................................................................. 1.1170 0.9379 19.4144 20.4635 20.7131 20.1878 

060041 ............................................................................. 0.9219 0.9379 20.8746 22.7123 23.4978 22.3670 

060043 ............................................................................. 0.9477 0.9379 19.1085 20.0939 18.7896 19.3418 

060044 ............................................................................. 1.1417 1.0517 25.6112 25.2471 25.0360 25.3737 

060049 ............................................................................. 1.2784 1.0146 25.3425 26.8089 29.0598 27.1748 

060050 ............................................................................. 1.1981 0.9379 20.4386 21.9108 * 21.1679 

060054 ............................................................................. 1.4335 0.9590 21.1281 23.5803 22.3490 22.3633 

060057 ............................................................................. 1.0788 0.9379 24.3982 26.9891 * 25.7472 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23493 

TABLE 2.—HOSPITAL CASE-MIX INDEXES FOR DISCHARGES OCCURRING IN FEDERAL FISCAL YEAR 2004; HOSPITAL AVERAGE HOURLY WAGE FOR FEDERAL FISCAL YEARS 2004 (2000 WAGE DATA), 2005 (2001 WAGE DATA), AND 2006 

(2002 WAGE DATA) WAGE INDEXES AND 3-YEAR AVERAGE OF HOSPITAL AVERAGE HOURLY WAGES—Continued 

Provider number Case-mix 

index 

Wage index 

FY 2006 

Average 

hourly wage 

FY 2004 

Average 

hourly wage 

FY 2005 

Average 

hourly wage 

FY 2006 

Average 

hourly 

wage ** 

(3 years) 

060064 ............................................................................. 1.4680 1.0710 29.1806 30.0963 31.3105 30.2470 

060065 ............................................................................. 1.2936 1.0710 29.2377 28.5282 31.1987 29.6323 

060070 ............................................................................. *** 0.9379 22.6894 * * 22.6894 

060075 ............................................................................. 1.2070 0.9379 27.7835 30.7835 32.7563 30.4907 

060076 ............................................................................. 1.2848 0.9379 23.6266 25.5406 26.8236 25.4496 

060096 ............................................................................. 1.5124 1.0517 26.4167 27.4085 30.0602 27.9908 

060100 ............................................................................. 1.6735 1.0710 28.0561 29.7690 32.1537 30.0220 

060103 ............................................................................. 1.1833 1.0517 26.6863 28.8063 30.3002 28.6961 

060104 ............................................................................. 1.3558 1.0710 26.7683 30.8625 32.0889 29.9703 

060107 ............................................................................. 1.4178 1.0710 * 26.8267 26.1883 26.4984 

060108 ............................................................................. *** * 19.0011 * * 19.0011 

060111 ............................................................................. *** * * 31.2571 * 31.2571 

070001 ............................................................................. 1.6316 1.1790 29.9592 32.2718 34.0302 32.0467 

070002 ............................................................................. 1.8165 1.1790 28.1101 29.0663 31.1530 29.4722 

070003 ............................................................................. 1.0898 1.1790 29.8684 31.3716 32.7173 31.3528 

070004 ............................................................................. 1.1896 1.1790 25.7207 27.3004 29.2292 27.3764 

070005 ............................................................................. 1.3796 1.1790 29.8173 29.3265 32.1668 30.4848 

070006 2 ........................................................................... 1.3118 1.2607 33.3814 33.9310 36.8469 34.7695 

070007 ............................................................................. 1.2843 1.1790 29.0336 30.3648 31.7097 30.4054 

070008 ............................................................................. 1.2463 1.1790 24.3907 24.9176 26.4806 25.2986 

070009 ............................................................................. 1.1856 1.1790 25.6072 28.8649 30.2706 28.2076 

070010 ............................................................................. 1.8269 1.2607 30.4192 33.1535 32.5798 32.0648 

070011 ............................................................................. 1.3577 1.1790 24.9457 27.5391 29.9105 27.3901 

070012 ............................................................................. 1.1771 1.1790 34.9099 40.3337 44.1424 39.6372 

070015 ............................................................................. 1.4329 1.1790 30.0614 30.9728 33.4595 31.5141 

070016 ............................................................................. 1.3424 1.1790 29.7505 29.6662 31.0903 30.2000 

070017 ............................................................................. 1.3696 1.1790 29.2978 30.3951 31.7223 30.4949 

070018 2 ........................................................................... 1.3351 1.2607 33.8654 35.7189 37.6081 35.8796 

070019 ............................................................................. 1.2584 1.1790 27.9838 29.6290 31.8148 29.8448 

070020 ............................................................................. 1.3392 1.1790 28.4084 29.9507 31.0935 29.8423 

070021 ............................................................................. 1.2614 1.1790 30.3254 31.4397 33.2357 31.7179 

070022 ............................................................................. 1.7784 1.1790 29.7376 32.3625 33.9804 32.0199 

070024 ............................................................................. 1.3851 1.1790 28.3460 30.8308 32.0430 30.4352 

070025 ............................................................................. 1.8564 1.1790 28.3017 29.2540 30.9938 29.5451 

070027 ............................................................................. 1.2911 1.1790 36.9700 27.3487 31.8018 31.4568 

070028 ............................................................................. 1.5983 1.2607 28.2078 29.5653 31.5036 29.7843 

070029 ............................................................................. 1.2773 1.1790 25.8107 26.3871 27.7213 26.6692 

070031 ............................................................................. 1.2393 1.1790 25.5880 27.2359 28.9190 27.3126 

070033 ............................................................................. 1.2635 1.3191 34.3904 35.5355 37.1929 35.7524 

070034 2 ........................................................................... 1.3877 1.2607 32.8074 35.6831 36.2719 34.9418 

070035 ............................................................................. 1.2964 1.1790 26.1693 27.1816 27.5585 26.9760 

070036 ............................................................................. 1.6654 1.1790 35.0701 34.0555 36.1610 35.1155 

070038 ............................................................................. 1.1608 * * 31.1133 25.7516 26.9407 

070039 ............................................................................. 0.9382 1.1790 32.6059 35.0164 31.2269 32.9340 

080001 ............................................................................. 1.6701 1.0652 28.0859 30.2463 30.0242 29.4815 

080002 ............................................................................. *** * 23.7309 26.4192 27.9670 26.0445 

080003 ............................................................................. 1.5462 1.0652 24.8199 27.1131 29.2266 26.9651 

080004 ............................................................................. 1.3741 1.0652 24.2251 26.0092 27.4735 25.9428 

080006 ............................................................................. 1.2769 0.9606 23.6838 24.4204 25.6160 24.5955 

080007 ............................................................................. 1.3900 1.0289 23.4964 24.6485 27.0074 25.0565 

090001 ............................................................................. 1.7108 1.0935 29.5432 31.3552 35.0413 32.0128 

090002 ............................................................................. *** * 23.5158 29.6780 * 25.5760 

090003 ............................................................................. 1.2607 1.0935 22.7014 27.0514 29.2660 26.1789 

090004 ............................................................................. 1.9783 1.0935 28.7417 29.9785 32.0186 30.3834 

090005 ............................................................................. 1.3818 1.0935 28.6142 30.2504 30.7728 29.9417 

090006 ............................................................................. 1.3806 1.0935 23.7241 25.9086 29.5590 26.3083 

090007 ............................................................................. *** * 25.8430 30.1419 * 27.7359 

090008 ............................................................................. 1.4284 1.0935 19.3212 29.6744 29.1059 25.7761 

090011 ............................................................................. 2.0113 1.0935 31.7710 32.4412 34.0693 32.7262 

100001 ............................................................................. 1.5628 0.9303 22.6150 25.2381 24.4060 24.0790 

100002 ............................................................................. 1.3511 1.0061 22.5982 22.1269 25.3389 23.3729 

100004 ............................................................................. 0.9314 0.8613 15.6306 16.2637 16.5974 16.2012 

100006 ............................................................................. 1.6100 0.9446 23.3745 26.2372 26.2258 25.3340 

100007 ............................................................................. 1.6285 0.9446 24.3305 25.4333 26.5612 25.5135 

100008 ............................................................................. 1.6365 0.9757 22.7706 25.7377 27.4314 25.4374 

100009 ............................................................................. 1.4157 0.9757 24.7811 24.4666 25.9381 25.0983 

100010 ............................................................................. *** * 25.5614 26.9486 * 26.2759 

23494 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

TABLE 2.—HOSPITAL CASE-MIX INDEXES FOR DISCHARGES OCCURRING IN FEDERAL FISCAL YEAR 2004; HOSPITAL AVERAGE HOURLY WAGE FOR FEDERAL FISCAL YEARS 2004 (2000 WAGE DATA), 2005 (2001 WAGE DATA), AND 2006 

(2002 WAGE DATA) WAGE INDEXES AND 3-YEAR AVERAGE OF HOSPITAL AVERAGE HOURLY WAGES—Continued 

Provider number Case-mix 

index 

Wage index 

FY 2006 

Average 

hourly wage 

FY 2004 

Average 

hourly wage 

FY 2005 

Average 

hourly wage 

FY 2006 

Average 

hourly 

wage ** 

(3 years) 

100012 ............................................................................. 1.6376 0.9333 24.2602 24.5762 26.3798 25.1067 

100014 ............................................................................. 1.2930 0.9307 21.7566 22.3054 24.5862 22.8508 

100015 ............................................................................. 1.3050 0.9292 22.1272 22.5781 24.6038 23.0946 

100017 ............................................................................. 1.5188 0.9307 21.1905 22.9545 26.1580 23.5300 

100018 ............................................................................. 1.6120 1.0115 24.1885 27.8582 28.1191 26.7581 

100019 ............................................................................. 1.6412 0.9826 24.2888 25.5566 27.5435 25.8847 

100020 ............................................................................. 1.3242 0.9757 23.5303 23.6106 23.8785 23.6811 

100022 ............................................................................. 1.7131 1.0508 27.9072 29.0519 29.9345 29.0212 

100023 ............................................................................. 1.4290 0.9446 21.8111 21.4015 23.0074 22.0889 

100024 ............................................................................. 1.2486 0.9757 24.4070 27.6476 30.2395 27.3189 

100025 ............................................................................. 1.6929 0.8613 21.2568 21.1174 22.1580 21.5429 

100026 ............................................................................. 1.6114 0.8613 20.1602 21.3533 21.3651 20.9595 

100027 ............................................................................. 1.2106 0.8613 23.8982 12.0314 16.1223 16.3797 

100028 ............................................................................. 1.2795 0.9826 21.8879 23.7818 26.8661 24.1693 

100029 ............................................................................. 1.1347 0.9757 24.6814 26.9307 27.5844 26.4439 

100030 ............................................................................. 1.2887 0.9446 21.8567 22.4887 24.0943 22.9211 

100032 ............................................................................. 1.6962 0.9292 21.6415 23.0174 25.2033 23.3437 

100034 ............................................................................. 1.8227 0.9757 23.1111 24.4064 25.9415 24.5360 

100035 ............................................................................. 1.5678 0.9554 22.6349 25.3590 26.9407 24.9239 

100038 ............................................................................. 1.8717 1.0508 25.7948 27.4422 29.8583 27.7714 

100039 ............................................................................. 1.3916 1.0508 23.8060 26.6016 28.4627 26.3398 

100040 ............................................................................. 1.6805 0.9303 22.4679 23.5372 23.6443 23.2382 

100043 ............................................................................. 1.2649 0.9292 21.7738 22.8963 25.2273 23.3549 

100044 ............................................................................. 1.4156 1.0162 23.9952 26.3208 28.3596 26.2570 

100045 ............................................................................. 1.3130 0.9446 25.2285 23.0520 26.9641 25.0756 

100046 ............................................................................. 1.2283 0.9292 24.2746 26.6169 26.3673 25.8723 

100047 ............................................................................. 1.6670 0.9274 24.3522 24.4212 25.0404 24.6186 

100048 ............................................................................. 0.9388 0.8613 17.5533 18.3767 18.8771 18.2575 

100049 ............................................................................. 1.1939 0.8934 21.8679 22.9532 22.9810 22.6230 

100050 ............................................................................. 1.1699 0.9757 20.0405 20.6893 19.8713 20.2035 

100051 ............................................................................. 1.3249 0.9446 20.0231 22.3311 23.2764 22.0397 

100052 ............................................................................. 1.3546 0.8934 20.5916 20.9078 22.3920 21.3174 

100053 ............................................................................. 1.2271 0.9757 23.7837 27.3383 27.3224 26.2170 

100054 ............................................................................. 1.1950 0.8877 22.0352 25.7279 28.0512 25.3241 

100055 ............................................................................. 1.3505 0.9292 19.6350 22.1051 23.5332 21.7040 

100056 ............................................................................. *** * 25.9245 25.7945 * 25.8574 

100057 ............................................................................. 1.4813 0.9446 24.6417 22.6038 25.3897 24.1823 

100061 ............................................................................. 1.5361 0.9757 26.1273 26.7673 29.2565 27.4077 

100062 ............................................................................. 1.7092 0.8955 24.9807 24.1413 25.2340 24.7789 

100063 ............................................................................. 1.2093 0.9292 21.5620 21.5566 24.7026 22.5862 

100067 ............................................................................. 1.4142 0.9292 23.8892 23.9333 25.4597 24.4499 

100068 ............................................................................. 1.7170 0.9307 23.7840 24.9025 25.9202 25.2289 

100069 ............................................................................. 1.3251 0.9292 19.6037 22.4386 24.3111 22.1685 

100070 ............................................................................. 1.6333 0.9554 23.5524 23.7746 24.9751 24.0912 

100071 ............................................................................. 1.2241 0.9292 21.7675 23.4176 24.9682 23.4234 

100072 ............................................................................. 1.3679 0.9307 23.5362 24.2934 26.0379 24.6995 

100073 ............................................................................. 1.6820 1.0508 23.5843 25.3685 30.3358 26.4443 

100075 ............................................................................. 1.4565 0.9292 22.3890 23.3503 25.1691 23.6907 

100076 ............................................................................. 1.2340 0.9757 19.6444 21.0777 21.9483 20.8673 

100077 ............................................................................. 1.4278 0.9274 22.3755 24.3478 26.0347 24.2410 

100080 ............................................................................. 1.7259 1.0061 22.8704 26.3596 27.0126 25.4415 

100081 ............................................................................. 1.0413 0.8672 16.8087 16.9168 15.6662 16.4022 

100084 ............................................................................. 1.7911 0.9446 24.1122 25.4140 26.3475 25.2653 

100086 ............................................................................. 1.2082 1.0508 25.2375 26.4817 28.2641 26.6950 

100087 ............................................................................. 1.8721 0.9554 26.5915 25.9909 26.4999 26.3569 

100088 ............................................................................. 1.6620 0.9303 23.6270 24.8729 25.9182 24.8465 

100090 ............................................................................. 1.4618 0.9303 22.5894 24.0501 24.2422 23.6608 

100092 ............................................................................. 1.5036 0.9826 25.4630 26.0856 28.4789 26.7319 

100093 ............................................................................. 1.6987 0.8613 20.2949 21.1547 21.3524 20.9431 

100098 ............................................................................. 1.0859 0.8613 20.0639 21.2505 * 20.6613 

100099 ............................................................................. 1.0146 0.8934 18.5287 20.4328 21.3036 20.1035 

100102 ............................................................................. 1.0412 0.8613 21.6772 22.8850 23.8596 22.8413 

100103 ............................................................................. 0.9567 0.8613 20.3633 21.7494 22.9256 21.7001 

100105 ............................................................................. 1.3654 0.9458 24.5464 24.9503 26.8091 25.4381 

100106 ............................................................................. 0.9426 0.8613 20.3417 20.2882 24.0389 21.6406 

100107 ............................................................................. 1.1491 0.9333 23.3789 24.4484 26.1337 24.6951 

100108 ............................................................................. 0.7656 0.8613 14.8039 16.3757 22.0750 17.7359 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23495 

TABLE 2.—HOSPITAL CASE-MIX INDEXES FOR DISCHARGES OCCURRING IN FEDERAL FISCAL YEAR 2004; HOSPITAL AVERAGE HOURLY WAGE FOR FEDERAL FISCAL YEARS 2004 (2000 WAGE DATA), 2005 (2001 WAGE DATA), AND 2006 

(2002 WAGE DATA) WAGE INDEXES AND 3-YEAR AVERAGE OF HOSPITAL AVERAGE HOURLY WAGES—Continued 

Provider number Case-mix 

index 

Wage index 

FY 2006 

Average 

hourly wage 

FY 2004 

Average 

hourly wage 

FY 2005 

Average 

hourly wage 

FY 2006 

Average 

hourly 

wage ** 

(3 years) 

100109 ............................................................................. 1.2500 0.9446 23.0779 23.8836 24.9951 24.0208 

100110 ............................................................................. 1.5138 0.9446 24.4533 28.3699 29.1494 27.5406 

100113 ............................................................................. 1.9521 0.9461 24.3614 25.0067 26.6479 25.3817 

100114 ............................................................................. 1.3471 0.9757 25.3699 27.7413 29.2195 27.4364 

100117 ............................................................................. 1.1856 0.9303 23.9134 26.0451 26.4536 25.5634 

100118 ............................................................................. 1.3280 0.9303 24.1104 23.6669 28.0569 25.5448 

100121 ............................................................................. 1.0708 0.8934 23.1100 24.0937 24.8579 24.0497 

100122 ............................................................................. 1.2187 0.8877 24.1820 21.2597 23.4751 22.8811 

100124 ............................................................................. 1.1623 0.8613 24.3048 21.6483 22.7023 22.7933 

100125 ............................................................................. 1.1807 0.9757 22.4185 25.3532 26.7452 24.9756 

100126 ............................................................................. 1.4012 0.9292 21.7977 23.2996 24.0192 23.0655 

100127 ............................................................................. 1.6390 0.9292 21.0153 21.3223 23.8920 22.0931 

100128 ............................................................................. 2.1468 0.9292 24.4104 25.6763 29.4979 26.6451 

100130 ............................................................................. 1.1903 1.0061 20.2478 22.8324 24.2046 22.4252 

100131 ............................................................................. 1.2656 0.9757 25.4811 25.8316 29.2462 26.9103 

100132 ............................................................................. 1.2174 0.9292 21.1538 23.0428 24.3293 22.8670 

100134 ............................................................................. 0.9426 0.8613 18.3391 19.5337 20.9244 19.6271 

100135 ............................................................................. 1.5934 0.8712 20.4915 22.3071 24.0024 22.2526 

100137 ............................................................................. 1.1612 0.8934 20.4007 23.3692 25.1974 23.1447 

100139 ............................................................................. 0.8526 0.9461 18.2204 14.5046 17.5489 16.8211 

100140 ............................................................................. 1.1665 0.9303 22.5124 24.8165 26.4720 24.7189 

100142 ............................................................................. 1.2175 0.8613 20.0689 20.7219 22.9577 21.2432 

100147 ............................................................................. *** 0.8613 17.1045 * * 17.1045 

100151 ............................................................................. 1.7655 0.9303 26.6470 26.1848 28.1322 27.0891 

100154 ............................................................................. 1.5497 0.9757 23.0820 26.3703 27.6127 25.8181 

100156 ............................................................................. 1.1022 0.8613 20.6928 22.2757 26.7092 23.2451 

100157 ............................................................................. 1.5782 0.9292 23.1045 25.9133 27.3851 25.4671 

100160 ............................................................................. 1.1887 0.8613 23.4877 27.2019 26.9851 25.9544 

100161 ............................................................................. 1.5792 0.9446 24.6268 28.3607 28.8077 27.4143 

100162 ............................................................................. *** * 23.8001 * * 23.8001 

100167 ............................................................................. 1.2864 1.0508 26.4517 26.8584 30.3694 27.8827 

100168 ............................................................................. 1.3732 1.0061 24.6276 26.0864 27.1292 25.9577 

100169 ............................................................................. *** * 23.4575 * * 23.4575 

100173 ............................................................................. 1.7343 0.9292 19.7190 22.4866 24.5390 22.2987 

100175 ............................................................................. 0.9876 0.8613 21.0474 22.0666 23.5455 22.2224 

100176 ............................................................................. 1.8792 1.0162 26.8740 29.8326 31.2694 29.3692 

100177 ............................................................................. 1.3177 0.9826 24.5078 25.3973 26.6781 25.6089 

100179 ............................................................................. 1.7603 0.9303 24.1801 26.6537 29.5619 26.9037 

100180 ............................................................................. 1.3719 0.9292 24.9433 26.3299 27.1804 26.1924 

100181 ............................................................................. 1.0880 0.9757 18.1320 19.5022 21.8540 19.8108 

100183 ............................................................................. 1.1753 0.9757 24.4575 26.7893 27.4951 26.3276 

100187 ............................................................................. 1.2686 0.9757 23.4760 26.1394 27.3653 25.7401 

100189 ............................................................................. 1.3096 1.0508 26.6846 26.5763 28.4136 27.3048 

100191 ............................................................................. 1.3075 0.9292 24.1911 24.3553 26.6340 25.0785 

100200 ............................................................................. 1.3785 1.0508 24.8120 28.0926 29.8963 27.6635 

100204 ............................................................................. 1.5254 0.9461 22.2613 24.4697 25.7537 24.2423 

100206 ............................................................................. 1.2968 0.9292 22.8782 23.0340 25.2196 23.7228 

100208 ............................................................................. *** * 24.1482 24.9854 * 24.5807 

100209 ............................................................................. 1.3575 0.9757 23.8502 25.0778 26.6246 25.2683 

100210 ............................................................................. 1.5359 1.0508 26.0933 28.6449 28.9486 27.9114 

100211 ............................................................................. 1.1787 0.9292 24.3243 * 24.7095 24.5352 

100212 ............................................................................. 1.4636 0.8955 22.6584 24.2669 24.7566 23.9351 

100213 ............................................................................. 1.5843 0.9554 24.4467 25.1893 27.1983 25.6153 

100217 ............................................................................. 1.1771 1.0162 24.0291 25.2635 25.2907 24.8791 

100220 ............................................................................. 1.6524 0.9333 24.9733 25.0154 26.0905 25.3692 

100223 ............................................................................. 1.5843 0.8877 21.2434 23.4556 24.7015 23.2004 

100224 ............................................................................. 1.2340 1.0508 23.0804 23.3593 24.8077 23.7932 

100225 ............................................................................. 1.2707 1.0508 23.9971 27.9473 28.4316 26.8326 

100226 ............................................................................. 1.2697 0.9303 23.8701 27.8003 29.3317 27.1288 

100228 ............................................................................. 1.3187 1.0508 26.2593 27.2873 29.8952 28.0013 

100229 ............................................................................. *** * 21.0038 * * 21.0038 

100231 ............................................................................. 1.6878 0.8613 23.5418 24.6994 25.5175 24.6455 

100232 h ........................................................................... 1.2214 0.9303 21.8105 23.9405 24.9322 23.5285 

100234 ............................................................................. 1.3110 1.0061 24.9141 25.2574 26.3601 25.5144 

100236 ............................................................................. 1.3623 0.9274 23.9781 25.9282 26.6585 25.5663 

100237 ............................................................................. 1.9568 1.0508 26.7664 25.6112 31.3543 27.7849 

100238 ............................................................................. 1.5077 0.9292 24.6513 27.1748 28.4302 26.8154 

23496 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

TABLE 2.—HOSPITAL CASE-MIX INDEXES FOR DISCHARGES OCCURRING IN FEDERAL FISCAL YEAR 2004; HOSPITAL AVERAGE HOURLY WAGE FOR FEDERAL FISCAL YEARS 2004 (2000 WAGE DATA), 2005 (2001 WAGE DATA), AND 2006 

(2002 WAGE DATA) WAGE INDEXES AND 3-YEAR AVERAGE OF HOSPITAL AVERAGE HOURLY WAGES—Continued 

Provider number Case-mix 

index 

Wage index 

FY 2006 

Average 

hourly wage 

FY 2004 

Average 

hourly wage 

FY 2005 

Average 

hourly wage 

FY 2006 

Average 

hourly 

wage ** 

(3 years) 

100239 ............................................................................. 1.2789 0.9554 25.0509 26.9668 27.7592 26.6605 

100240 ............................................................................. 0.9534 0.9757 23.0650 23.4830 25.3265 24.0024 

100242 ............................................................................. 1.3586 0.8613 20.4681 21.5130 24.0990 22.0856 

100243 ............................................................................. 1.5324 0.9292 23.2812 25.2987 26.1131 24.9766 

100244 ............................................................................. 1.3330 0.9333 23.4876 24.1515 25.2584 24.3502 

100246 ............................................................................. 1.6049 1.0162 26.7630 27.6382 28.9894 27.8151 

100248 ............................................................................. 1.4986 0.9292 23.8742 25.9170 27.7797 25.9263 

100249 ............................................................................. 1.2539 0.8955 21.3942 23.4021 23.2084 22.6697 

100252 ............................................................................. 1.1974 1.0162 22.6475 24.9860 25.8540 24.5257 

100253 ............................................................................. 1.3797 1.0061 23.6939 24.4051 25.7121 24.6472 

100254 ............................................................................. 1.5814 0.8712 23.2794 25.0192 25.7338 24.6995 

100255 ............................................................................. 1.1947 0.9292 22.9793 22.2341 24.1169 23.1055 

100256 ............................................................................. 1.9673 0.9292 24.1969 26.0629 28.8856 26.4333 

100258 ............................................................................. 1.4847 1.0061 24.5699 31.8772 31.2482 29.0443 

100259 ............................................................................. 1.2244 0.9292 24.1148 24.9404 26.0175 25.0705 

100260 ............................................................................. 1.3413 1.0162 23.5164 25.2630 27.5188 25.5518 

100262 ............................................................................. *** * 23.8006 26.3954 * 25.1412 

100264 ............................................................................. 1.2531 0.9292 22.4800 25.0250 25.5489 24.4115 

100265 ............................................................................. 1.2774 0.9292 21.0688 23.4758 23.6151 22.8276 

100266 ............................................................................. 1.4031 0.8613 21.5258 22.6614 23.2340 22.5196 

100267 ............................................................................. 1.2776 0.9554 23.3760 26.5059 27.3768 25.7444 

100268 ............................................................................. 1.1529 1.0061 26.0297 29.8289 29.2898 28.4053 

100269 ............................................................................. 1.3034 1.0061 24.9002 25.3228 26.7450 25.7303 

100275 ............................................................................. 1.2616 1.0061 23.1419 24.3059 26.0361 24.5544 

100276 ............................................................................. 1.2369 1.0508 25.4557 27.2589 30.0576 27.6322 

100277 ............................................................................. 1.3339 0.9757 25.2985 47.3905 16.5427 24.0477 

100279 ............................................................................. 1.2334 0.9333 24.8484 25.4909 26.8606 25.7747 

100281 ............................................................................. 1.2641 1.0508 25.3382 27.0864 28.6660 27.1929 

100284 ............................................................................. 1.0813 0.9757 22.3046 22.5927 23.8170 22.9628 

100286 ............................................................................. 1.5579 1.0115 * 27.1051 29.4284 28.3288 

100287 ............................................................................. 1.3676 1.0061 * 28.2229 28.3427 28.2858 

100288 ............................................................................. 1.5140 1.0061 * 37.4785 33.8141 35.4781 

100289 ............................................................................. 1.7415 1.0508 * 28.4504 29.2915 28.8970 

100290 ............................................................................. 1.1280 0.8613 * * 23.5080 23.5080 

100292 ............................................................................. 1.2103 0.8672 * * 25.9093 25.9093 

110001 ............................................................................. 1.2172 0.9637 24.0561 25.1164 25.2695 24.8146 

110002 ............................................................................. 1.2471 0.9637 20.4502 21.8616 25.3897 22.5380 

110003 ............................................................................. 1.2762 0.9303 19.7061 20.0968 21.4002 20.4029 

110004 ............................................................................. 1.2242 0.9099 21.8791 22.7929 23.9911 22.8563 

110005 ............................................................................. 1.1543 0.9637 23.6146 22.3645 22.8082 22.9077 

110006 ............................................................................. 1.4983 0.9813 23.8762 25.0719 28.6090 25.8225 

110007 ............................................................................. 1.5952 0.8645 28.2025 30.7430 23.8785 27.0990 

110008 ............................................................................. 1.3541 0.9637 22.6308 23.4662 27.0198 24.4256 

110010 ............................................................................. 2.1112 0.9637 27.2029 28.7690 29.7142 28.5850 

110011 ............................................................................. 1.1841 0.9637 23.2149 25.4620 26.0899 24.9213 

110015 ............................................................................. 1.1253 0.9637 23.2280 25.5661 26.6610 25.2080 

110016 ............................................................................. 1.1938 0.7684 18.8228 18.8376 21.7610 19.7802 

110018 ............................................................................. 1.1764 0.9637 24.7007 25.6485 28.2431 26.2640 

110020 ............................................................................. 1.2808 0.9637 23.3004 24.8735 26.8501 25.0177 

110023 ............................................................................. 1.3725 0.9637 23.5673 25.3746 27.3029 25.5307 

110024 ............................................................................. 1.3712 0.9483 22.1471 23.8091 25.7205 23.8901 

110025 ............................................................................. 1.4319 0.9303 29.0965 31.5253 26.1311 28.6493 

110026 ............................................................................. 1.1005 0.7684 19.3201 20.5740 21.2826 20.4005 

110027 ............................................................................. 1.0627 0.7684 19.8351 19.2323 20.2175 19.7328 

110028 ............................................................................. 1.7504 0.9567 25.9474 25.1836 27.9184 26.3393 

110029 ............................................................................. 1.6515 0.9637 22.7981 25.2335 24.8893 24.3542 

110030 ............................................................................. 1.1953 0.9637 22.2341 25.0842 26.4770 24.7162 

110031 ............................................................................. 1.2600 0.9637 22.8695 24.1711 26.0384 24.4325 

110032 ............................................................................. 1.1631 0.7684 18.0744 20.7211 21.9407 20.2437 

110033 ............................................................................. 1.3973 0.9637 24.1447 25.2326 28.3210 25.8930 

110034 ............................................................................. 1.6993 0.9567 24.0791 24.4141 27.0099 25.1876 

110035 ............................................................................. 1.4949 0.9637 24.2581 25.7562 27.5532 25.9518 

110036 ............................................................................. 1.7799 0.9483 24.4788 25.4854 26.8789 25.6507 

110038 ............................................................................. 1.5400 0.8420 20.1710 20.5880 21.2138 20.6802 

110039 ............................................................................. 1.4119 0.9567 17.0608 19.4032 19.7892 18.7582 

110040 ............................................................................. 1.1097 0.9637 17.3095 18.8744 19.7509 18.6568 

110041 ............................................................................. 1.2580 0.9684 20.8080 21.5402 23.4074 21.9417 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23497 

TABLE 2.—HOSPITAL CASE-MIX INDEXES FOR DISCHARGES OCCURRING IN FEDERAL FISCAL YEAR 2004; HOSPITAL AVERAGE HOURLY WAGE FOR FEDERAL FISCAL YEARS 2004 (2000 WAGE DATA), 2005 (2001 WAGE DATA), AND 2006 

(2002 WAGE DATA) WAGE INDEXES AND 3-YEAR AVERAGE OF HOSPITAL AVERAGE HOURLY WAGES—Continued 

Provider number Case-mix 

index 

Wage index 

FY 2006 

Average 

hourly wage 

FY 2004 

Average 

hourly wage 

FY 2005 

Average 

hourly wage 

FY 2006 

Average 

hourly 

wage ** 

(3 years) 

110042 ............................................................................. 1.0979 0.9637 25.5588 26.8321 23.4645 25.2397 

110043 ............................................................................. 1.7289 0.9483 22.7589 25.2788 26.7522 24.9357 

110044 ............................................................................. 1.1609 0.7684 19.2562 19.6940 20.9654 19.9819 

110045 ............................................................................. 1.1384 0.9637 19.7746 21.3922 24.9821 22.1119 

110046 ............................................................................. 1.1501 0.9637 21.6201 24.0022 23.8292 23.2190 

110049 ............................................................................. 0.9635 0.7684 18.9096 19.8706 * 19.4074 

110050 ............................................................................. 1.0937 0.9033 * 25.6020 * 25.6020 

110051 ............................................................................. 1.1347 0.7684 17.6816 19.0995 19.4276 18.7634 

110054 ............................................................................. 1.4875 0.9637 20.5387 22.2250 25.7085 22.7254 

110056 ............................................................................. 0.9430 0.7684 21.7608 23.0080 * 22.3710 

110059 ............................................................................. 1.0697 0.7684 19.9802 18.7097 20.5565 19.6943 

110061 ............................................................................. *** 0.8873 18.6696 * * 18.6696 

110064 ............................................................................. 1.4700 0.8570 21.7636 23.8739 24.2739 23.3486 

110069 ............................................................................. 1.2734 0.9087 21.0518 22.3006 24.1669 22.5324 

110071 ............................................................................. 0.9739 0.7684 15.2336 13.3731 18.0224 15.4555 

110073 ............................................................................. 1.0759 0.7684 15.2711 16.3610 18.6336 16.6863 

110074 ............................................................................. 1.4999 0.9813 24.4094 27.5836 27.0337 26.3402 

110075 ............................................................................. 1.2670 0.9316 20.4634 20.9973 22.0935 21.2149 

110076 ............................................................................. 1.4563 0.9637 23.8211 25.2424 26.3506 25.1774 

110078 ............................................................................. 2.0424 0.9637 28.2149 27.8627 24.8746 26.9445 

110079 ............................................................................. 1.3966 0.9637 22.8017 24.5255 23.1024 23.4646 

110080 ............................................................................. 1.2439 0.9637 24.1958 21.5482 22.3213 22.5788 

110082 ............................................................................. 1.9154 0.9637 27.2931 28.9731 29.8366 28.7072 

110083 ............................................................................. 1.9070 0.9637 24.6460 26.2604 27.8245 26.3029 

110086 ............................................................................. 1.3847 0.7684 18.8751 20.8557 21.1509 20.2673 

110087 ............................................................................. 1.4065 0.9637 25.7908 26.2872 28.0471 26.7332 

110089 ............................................................................. 1.1502 0.7684 20.6757 21.2013 21.9509 21.2887 

110091 ............................................................................. 1.2996 0.9637 24.3354 26.3857 26.5523 25.8218 

110092 ............................................................................. 1.0125 0.7684 16.9116 18.7397 18.5527 18.0853 

110095 ............................................................................. 1.3953 0.8710 20.1024 21.8709 23.4846 21.8636 

110096 ............................................................................. 0.9779 0.7684 18.5513 19.4498 * 19.0000 

110100 ............................................................................. 0.9643 0.7684 15.1316 16.5833 16.5600 16.0845 

110101 ............................................................................. 1.0706 0.7684 13.3943 14.4630 16.4270 14.7428 

110104 ............................................................................. 1.0494 0.7684 17.9805 19.5575 18.7951 18.8040 

110105 ............................................................................. 1.3229 0.7684 19.2156 20.6270 21.1077 20.3365 

110107 ............................................................................. 1.8630 0.9485 21.8167 26.0763 26.2526 24.6977 

110109 ............................................................................. 1.0104 0.7684 18.7397 20.4726 21.4280 20.2690 

110111 ............................................................................. 1.1313 0.9567 20.9535 20.5577 29.2190 22.9282 

110112 ............................................................................. 0.9374 0.7684 20.4565 21.0612 24.2463 21.7104 

110113 ............................................................................. 1.0686 0.9567 18.0770 16.7641 19.1753 18.0155 

110115 ............................................................................. 1.6816 0.9637 26.3274 29.8699 32.0197 29.3454 

110118 ............................................................................. *** 0.7684 17.7344 * * 17.7344 

110121 ............................................................................. 1.0384 0.7684 19.5230 21.2534 21.6637 20.8173 

110122 ............................................................................. 1.5295 0.8420 20.4184 22.0210 23.7589 22.1314 

110124 ............................................................................. 1.0742 0.7684 19.7004 20.9334 22.7058 21.1178 

110125 ............................................................................. 1.2373 0.9087 19.8695 22.1458 22.4238 21.5044 

110128 ............................................................................. 1.2076 0.9316 28.4943 23.2576 24.4596 24.9779 

110129 ............................................................................. 1.5230 0.8570 21.8204 22.4202 23.3631 22.5595 

110130 ............................................................................. 0.9412 0.7684 17.5272 17.6529 18.7549 18.0115 

110132 ............................................................................. 1.0349 0.7684 17.2924 18.9927 19.2307 18.5224 

110135 ............................................................................. 1.2847 0.7684 18.5125 20.0057 20.4411 19.6750 

110136 ............................................................................. 1.0675 0.7684 21.1235 22.7715 15.3030 19.7964 

110142 ............................................................................. 0.9587 0.7684 16.3359 17.3328 18.1980 17.2921 

110143 ............................................................................. 1.3701 0.9637 24.3898 25.4932 24.2240 24.6996 

110146 ............................................................................. 1.0472 0.7684 17.2250 19.9221 23.9067 20.1122 

110149 ............................................................................. 1.3335 0.9637 25.3619 24.7686 27.1477 25.8232 

110150 ............................................................................. 1.2656 0.9087 22.7366 23.8157 22.6624 23.0726 

110153 ............................................................................. 1.1467 0.9087 21.5300 22.8660 24.5368 22.9872 

110155 ............................................................................. *** * 16.1785 * * 16.1785 

110163 ............................................................................. 1.4114 0.8645 21.9411 25.5461 26.0764 24.4314 

110164 ............................................................................. 1.5149 0.9485 23.7801 26.4450 27.0600 25.7931 

110165 ............................................................................. 1.3808 0.9637 23.4071 24.3897 26.8378 24.9170 

110166 ............................................................................. *** 0.9485 23.6665 25.2264 26.8070 25.1758 

110168 ............................................................................. 1.8280 0.9637 23.3426 24.6321 27.0022 25.0628 

110169 ............................................................................. *** * 24.7083 * * 24.7083 

110172 ............................................................................. 1.1832 0.9637 25.2396 27.0240 29.1703 27.1002 

110177 ............................................................................. 1.6699 0.9567 24.0700 25.0129 26.7504 25.3590 

23498 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

TABLE 2.—HOSPITAL CASE-MIX INDEXES FOR DISCHARGES OCCURRING IN FEDERAL FISCAL YEAR 2004; HOSPITAL AVERAGE HOURLY WAGE FOR FEDERAL FISCAL YEARS 2004 (2000 WAGE DATA), 2005 (2001 WAGE DATA), AND 2006 

(2002 WAGE DATA) WAGE INDEXES AND 3-YEAR AVERAGE OF HOSPITAL AVERAGE HOURLY WAGES—Continued 

Provider number Case-mix 

index 

Wage index 

FY 2006 

Average 

hourly wage 

FY 2004 

Average 

hourly wage 

FY 2005 

Average 

hourly wage 

FY 2006 

Average 

hourly 

wage ** 

(3 years) 

110179 ............................................................................. *** * 26.0365 26.1173 26.0759 26.0760 

110183 ............................................................................. 1.2345 0.9637 26.4248 27.6020 26.8591 26.9602 

110184 ............................................................................. 1.2007 0.9637 24.3379 25.5420 23.3803 24.3763 

110186 ............................................................................. 1.3771 0.8570 21.1176 23.2348 25.0299 23.1796 

110187 ............................................................................. 1.2237 0.9637 23.2571 22.5730 24.2933 23.3967 

110188 ............................................................................. *** * 24.4785 * * 24.4785 

110190 ............................................................................. 1.0046 0.7684 21.9008 19.1054 14.2517 17.7557 

110191 ............................................................................. 1.2930 0.9637 24.0572 25.8409 26.8277 25.5872 

110192 ............................................................................. 1.3222 0.9637 24.3823 25.7406 26.7852 25.7103 

110193 ............................................................................. 1.4229 0.9637 25.1779 27.8223 27.3341 26.8213 

110194 ............................................................................. 0.9346 0.7684 16.8075 16.3148 18.4776 17.2529 

110198 ............................................................................. 1.3834 0.9637 28.0634 30.8014 31.7748 30.3084 

110200 ............................................................................. 1.8830 0.8570 20.1816 21.2177 22.3249 21.2486 

110201 ............................................................................. 1.3894 0.9485 24.1171 27.0388 28.2232 26.3653 

110203 ............................................................................. 0.9912 0.9637 30.2609 25.8951 26.8768 27.4232 

110205 ............................................................................. 1.0674 0.9637 23.1969 20.6150 19.7409 21.0203 

110209 ............................................................................. 0.5352 0.7684 17.4145 19.1000 19.0450 18.5793 

110212 ............................................................................. 1.0406 0.8873 18.7651 20.9365 40.5120 27.9394 

110215 ............................................................................. 1.2618 0.9637 22.5679 23.9657 25.7886 24.2458 

110218 ............................................................................. *** * * 26.1073 * 26.1073 

110219 ............................................................................. 1.3845 0.9637 * 27.1880 27.0362 27.1115 

120001 ............................................................................. 1.7853 1.1206 30.0871 31.7108 34.6602 32.1463 

120002 ............................................................................. 1.2134 1.0598 24.2715 26.9900 29.9913 27.2572 

120004 ............................................................................. 1.2673 1.1206 26.8010 28.3569 28.6527 27.9367 

120005 ............................................................................. 1.2757 1.0598 23.0113 26.9053 29.3405 26.3828 

120006 ............................................................................. 1.2232 1.1206 28.1562 29.6751 31.1372 29.6846 

120007 ............................................................................. 1.6776 1.1206 27.8497 28.7964 30.4247 29.0434 

120010 ............................................................................. 1.6785 1.1206 25.4050 27.1265 30.1659 27.2823 

120011 ............................................................................. 1.4508 1.1206 30.9308 31.7447 34.1643 32.3199 

120014 ............................................................................. 1.2099 1.0598 25.3682 28.0786 28.6416 27.3772 

120016 ............................................................................. 1.6705 * 39.1173 52.1034 19.6034 33.6763 

120019 ............................................................................. 1.2043 1.0598 24.4036 28.9661 30.3809 27.8836 

120022 ............................................................................. 1.8525 1.1206 22.4951 24.7875 26.6100 24.7024 

120025 ............................................................................. *** 1.0598 40.2473 48.7148 30.2358 39.7283 

120026 ............................................................................. 1.2887 1.1206 26.3653 28.5048 30.3293 28.4200 

120027 ............................................................................. 1.2295 1.1206 24.9464 26.4630 28.4378 26.4965 

120028 ............................................................................. 1.2577 1.1206 29.5070 31.3195 30.3794 30.4272 

130002 ............................................................................. 1.3569 0.9048 20.1143 21.6626 23.6078 21.8876 

130003 ............................................................................. 1.3696 1.0061 23.9403 25.4904 27.6345 25.7287 

130005 ............................................................................. *** * 24.4844 25.2550 25.7523 25.1326 

130006 ............................................................................. 1.7884 0.9048 22.8567 24.3982 25.3221 24.2894 

130007 ............................................................................. 1.7321 0.9048 22.8475 24.8764 24.9562 24.2827 

130011 ............................................................................. 1.2145 0.8810 23.1120 22.9336 * 23.0196 

130013 ............................................................................. 1.2894 0.9048 23.5316 26.3118 27.9209 25.9669 

130014 ............................................................................. 1.1794 0.9048 21.6495 23.4789 24.3884 23.2115 

130018 ............................................................................. 1.5937 0.8810 22.2249 23.9798 26.4125 24.2860 

130021 ............................................................................. *** 0.8810 18.0006 18.9400 16.1658 17.7607 

130022 ............................................................................. 1.1803 0.8810 21.5602 * * 21.5602 

130025 ............................................................................. 1.1842 0.8810 18.7814 19.7066 20.1452 19.5513 

130026 ............................................................................. 1.1103 0.8810 24.4976 25.4020 * 24.9502 

130028 ............................................................................. 1.3641 0.9348 21.1492 25.2938 26.3443 24.2492 

130036 ............................................................................. *** * 18.5921 16.7907 * 17.6689 

130045 ............................................................................. *** 0.9183 19.0270 * * 19.0270 

130060 ............................................................................. *** * 24.6773 26.7516 * 25.7861 

130062 ............................................................................. *** 0.9409 24.0494 16.7951 20.6642 20.3051 

130063 ............................................................................. 1.4243 0.9048 18.8782 20.9502 22.5904 20.7967 

140001 ............................................................................. 1.0825 0.8285 20.0247 21.4779 22.3170 21.3141 

140002 ............................................................................. 1.2711 0.8953 23.0207 24.4908 24.6954 24.0687 

140003 ............................................................................. 1.0209 0.8285 19.2097 22.6230 * 20.9305 

140005 ............................................................................. *** 0.8285 13.2365 * * 13.2365 

140008 ............................................................................. 1.4951 1.0846 26.3287 27.2211 28.5297 27.3790 

140010 ............................................................................. 1.4434 1.0846 29.0224 31.5774 36.6365 32.6197 

140011 ............................................................................. 1.1508 0.8285 19.0903 20.6338 22.4091 20.7429 

140012 ............................................................................. 1.2283 1.0698 24.4070 24.3675 28.6564 25.7920 

140013 ............................................................................. 1.4165 0.8844 19.9800 22.6022 23.3065 21.9604 

140015 ............................................................................. 1.3843 0.8953 21.4328 22.2266 23.0600 22.2778 

140016 ............................................................................. 1.0074 0.8285 16.3417 17.1372 18.1242 17.2195 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23499 

TABLE 2.—HOSPITAL CASE-MIX INDEXES FOR DISCHARGES OCCURRING IN FEDERAL FISCAL YEAR 2004; HOSPITAL AVERAGE HOURLY WAGE FOR FEDERAL FISCAL YEARS 2004 (2000 WAGE DATA), 2005 (2001 WAGE DATA), AND 2006 

(2002 WAGE DATA) WAGE INDEXES AND 3-YEAR AVERAGE OF HOSPITAL AVERAGE HOURLY WAGES—Continued 

Provider number Case-mix 

index 

Wage index 

FY 2006 

Average 

hourly wage 

FY 2004 

Average 

hourly wage 

FY 2005 

Average 

hourly wage 

FY 2006 

Average 

hourly 

wage ** 

(3 years) 

140018 ............................................................................. 1.4161 1.0846 24.3285 27.3334 27.7548 26.4350 

140019 ............................................................................. 0.9635 0.8285 17.4206 18.4554 18.9228 18.2432 

140024 ............................................................................. 0.9981 0.8285 15.6616 16.9672 17.5249 16.7192 

140026 ............................................................................. 1.1611 0.8285 20.4084 21.6847 23.0470 21.6994 

140027 ............................................................................. 1.1589 0.8285 20.9855 22.6208 * 21.8225 

140029 ............................................................................. 1.5505 1.0846 25.0485 27.7304 28.9717 27.3787 

140030 ............................................................................. 1.6859 1.0846 26.5733 28.7623 29.3100 28.2629 

140032 ............................................................................. 1.1817 0.8953 20.6273 22.8157 24.0574 22.5257 

140033 ............................................................................. 1.2115 1.0444 23.4279 26.1553 25.6068 25.0497 

140034 ............................................................................. 1.2308 0.8953 20.9635 22.1003 23.0034 21.9987 

140037 ............................................................................. 0.8583 0.8285 15.5578 * * 15.5578 

140043 ............................................................................. 1.2327 0.9667 23.3751 26.0330 26.7996 25.3939 

140045 ............................................................................. 1.0328 0.8285 18.9587 21.0042 20.6548 20.2345 

140046 ............................................................................. 1.4582 0.8953 21.7969 22.5022 23.2127 22.5567 

140048 ............................................................................. 1.2496 1.0846 25.9122 27.0874 28.2222 27.0819 

140049 ............................................................................. 1.5568 1.0846 21.9546 26.6533 27.4009 25.3465 

140051 ............................................................................. 1.5044 1.0846 24.2472 27.9935 27.7901 26.6740 

140052 ............................................................................. 1.1992 0.8953 21.8161 22.2588 23.5662 22.5560 

140053 ............................................................................. 1.8567 0.8879 22.6099 23.5477 24.8455 23.6468 

140054 ............................................................................. 1.4302 1.0846 35.5659 31.7265 31.8564 32.8769 

140058 ............................................................................. 1.2547 0.8953 20.5089 22.1269 22.8423 21.8133 

140059 ............................................................................. 1.0783 0.8953 19.9777 22.7121 22.4651 21.7552 

140061 ............................................................................. 0.9751 0.8953 22.7515 30.9925 20.8063 24.6734 

140062 ............................................................................. 1.2085 1.0846 30.7005 31.2359 34.7113 32.2167 

140063 ............................................................................. 1.3649 1.0846 30.5430 26.5584 27.8306 28.2367 

140064 ............................................................................. 1.1568 0.8844 20.6505 21.7470 22.0407 21.4911 

140065 ............................................................................. 1.3774 1.0846 26.3521 26.1904 34.6406 28.8914 

140066 ............................................................................. 1.1153 0.8953 18.0915 20.4353 19.4775 19.2927 

140067 ............................................................................. 1.8344 0.8844 21.9579 23.5906 25.3986 23.6801 

140068 ............................................................................. 1.1769 1.0846 24.1316 25.8963 27.3956 25.8156 

140070 ............................................................................. *** * 25.2960 * * 25.2960 

140077 ............................................................................. 0.9555 0.8953 18.0487 19.0922 19.1363 18.7657 

140079 ............................................................................. *** * 25.7090 29.3040 * 27.5634 

140080 ............................................................................. 1.4264 1.0846 24.4056 26.0109 23.2575 24.4826 

140082 ............................................................................. 1.3940 1.0846 25.0474 26.8077 25.6645 25.8332 

140083 ............................................................................. 1.0155 1.0846 23.2822 24.6491 26.5562 24.8886 

140084 ............................................................................. 1.1998 1.0444 25.4818 27.6819 29.2515 27.5306 

140088 ............................................................................. 1.8091 1.0846 28.4219 31.0364 32.4978 30.6729 

140089 ............................................................................. 1.1918 0.8285 20.7632 22.1227 23.3401 22.0452 

140090 ............................................................................. *** * 35.0300 * * 35.0300 

140093 ............................................................................. 1.1539 0.9048 21.5376 22.1540 25.3127 22.9099 

140094 ............................................................................. 1.0354 1.0846 24.2166 25.3678 27.0578 25.5410 

140095 ............................................................................. 1.2149 1.0846 24.7706 29.9746 27.6799 27.5947 

140100 ............................................................................. 1.2204 1.0444 27.1868 32.8743 37.0819 32.5610 

140101 ............................................................................. 1.1371 1.0846 24.6106 25.4784 28.5365 26.3107 

140102 ............................................................................. 1.0407 0.8285 19.8678 21.2278 * 20.5493 

140103 ............................................................................. 1.2439 1.0846 21.2404 21.7512 23.3258 22.1297 

140105 ............................................................................. 1.2336 1.0846 27.3323 26.3054 27.4531 27.0018 

140109 ............................................................................. 1.1423 0.8285 16.4261 17.8103 19.5675 17.9602 

140110 ............................................................................. 1.0533 1.0698 21.9880 25.6561 27.9844 25.2166 

140113 ............................................................................. 1.5519 0.9591 25.6621 23.5337 26.7969 25.2477 

140114 ............................................................................. 1.4645 1.0846 24.1926 25.7968 28.3014 26.1695 

140115 ............................................................................. 1.1252 1.0846 25.3410 26.3677 25.1498 25.6313 

140116 ............................................................................. 1.2744 1.0846 26.8924 30.5166 31.9902 29.9696 

140117 ............................................................................. 1.5049 1.0846 23.3531 25.6314 26.8973 25.3122 

140118 ............................................................................. 1.6963 1.0846 26.7350 27.7392 29.7570 28.1023 

140119 ............................................................................. 1.7432 1.0846 31.3486 33.6302 36.1419 33.6518 

140120 ............................................................................. 1.2478 0.8844 20.3237 22.5795 22.7375 21.8812 

140121 ............................................................................. 1.6002 0.8844 17.6019 * * 17.6019 

140124 ............................................................................. 1.2606 1.0846 30.9648 35.2798 36.1327 34.0784 

140125 ............................................................................. 1.2180 0.8953 19.5359 20.7189 20.4014 20.2151 

140127 ............................................................................. 1.5733 0.9083 21.3102 22.8172 24.1658 22.7988 

140129 ............................................................................. *** 0.8285 21.6495 * * 21.6495 

140132 ............................................................................. *** * 23.0595 * * 23.0595 

140135 ............................................................................. 1.3954 0.8285 19.7919 21.2104 22.3264 21.1811 

140137 ............................................................................. 1.0383 0.8953 21.6017 20.5053 21.4700 21.1955 

140140 ............................................................................. 1.0049 0.8285 19.1636 21.4710 * 20.3063 

23500 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

TABLE 2.—HOSPITAL CASE-MIX INDEXES FOR DISCHARGES OCCURRING IN FEDERAL FISCAL YEAR 2004; HOSPITAL AVERAGE HOURLY WAGE FOR FEDERAL FISCAL YEARS 2004 (2000 WAGE DATA), 2005 (2001 WAGE DATA), AND 2006 

(2002 WAGE DATA) WAGE INDEXES AND 3-YEAR AVERAGE OF HOSPITAL AVERAGE HOURLY WAGES—Continued 

Provider number Case-mix 

index 

Wage index 

FY 2006 

Average 

hourly wage 

FY 2004 

Average 

hourly wage 

FY 2005 

Average 

hourly wage 

FY 2006 

Average 

hourly 

wage ** 

(3 years) 

140141 ............................................................................. 1.0111 0.8953 20.3706 23.0515 21.7871 21.7302 

140143 ............................................................................. 1.1472 0.8844 22.0009 23.8255 26.2954 24.0154 

140144 ............................................................................. 0.9464 1.0846 26.9258 27.8046 * 27.3474 

140145 ............................................................................. 1.1245 0.8953 19.6429 21.6168 23.4608 21.6090 

140147 ............................................................................. 1.1208 0.8285 18.2692 19.5896 19.8541 19.2467 

140148 ............................................................................. 1.7042 0.8879 21.5777 23.0022 25.2030 23.2104 

140150 ............................................................................. 1.5763 1.0846 32.9291 33.9013 35.2711 34.0702 

140151 ............................................................................. 0.8471 1.0846 21.5167 22.4842 23.4879 22.5018 

140152 ............................................................................. 1.1463 1.0846 28.5468 29.6882 27.6086 28.6011 

140155 2 ........................................................................... 1.2537 1.0991 25.2034 27.6610 28.9724 27.2937 

140158 ............................................................................. 1.3922 1.0846 22.5638 23.8542 28.6818 24.8001 

140160 ............................................................................. 1.2262 0.9667 20.9986 22.7002 24.5373 22.7502 

140161 ............................................................................. 1.1181 1.0698 22.2191 24.1071 23.1647 23.1691 

140162 ............................................................................. 1.5842 0.9083 22.6426 26.0312 27.4472 25.4182 

140164 ............................................................................. 1.7335 0.8953 19.7774 22.0424 23.7457 21.8696 

140165 ............................................................................. 1.0648 0.8285 17.0666 15.9312 16.6304 16.5175 

140166 ............................................................................. 1.1685 0.8285 20.7849 21.7776 23.1005 21.8859 

140167 ............................................................................. 1.0308 0.8285 19.5959 19.7610 22.8911 20.7477 

140168 ............................................................................. 1.1558 0.8953 18.7504 20.0225 * 19.4021 

140170 ............................................................................. 0.9276 0.8285 17.0665 17.1608 * 17.1147 

140171 ............................................................................. *** 0.8285 17.3214 * * 17.3214 

140174 ............................................................................. 1.4550 1.0846 23.6893 24.7011 27.8131 25.3970 

140176 ............................................................................. 1.2096 1.0846 25.6824 28.9378 31.3490 28.8390 

140177 ............................................................................. 0.8782 1.0846 20.8526 19.3328 22.5610 20.9656 

140179 ............................................................................. 1.3651 1.0846 24.1539 26.3200 27.6376 26.0525 

140180 ............................................................................. 1.2658 1.0846 25.4022 27.4366 28.3649 27.0717 

140181 ............................................................................. 1.1677 1.0846 23.7308 23.6034 25.0100 24.1182 

140182 ............................................................................. 1.4864 1.0846 32.1969 28.0337 28.2211 28.8901 

140184 ............................................................................. 1.2150 0.8285 20.6499 20.1279 21.1802 20.6885 

140185 ............................................................................. 1.4160 0.8953 20.0903 22.0222 23.8531 22.0093 

140186 2 ........................................................................... 1.4842 1.0991 26.0970 28.1977 31.7593 28.8521 

140187 ............................................................................. 1.4808 0.8953 20.5829 22.0674 23.2892 21.9710 

140189 ............................................................................. 1.1406 0.9335 22.5875 25.6954 23.7198 24.0159 

140190 ............................................................................. 1.0678 0.8285 17.9193 18.8530 19.8297 18.8585 

140191 ............................................................................. 1.3038 1.0846 24.5446 25.2817 25.8813 25.2456 

140193 ............................................................................. 0.9615 0.8285 20.5958 22.9443 * 21.7731 

140197 ............................................................................. 1.2361 1.0846 19.2980 21.8060 23.0684 21.2577 

140199 ............................................................................. 1.0379 0.8285 19.7888 21.3464 22.0315 21.0597 

140200 ............................................................................. 1.4887 1.0846 24.1358 24.9217 26.6881 25.2459 

140202 ............................................................................. 1.5458 1.0444 26.2460 27.4336 29.7870 27.9702 

140203 ............................................................................. 1.0810 1.0846 26.5789 28.2212 * 27.4338 

140205 ............................................................................. 0.5846 0.9975 25.1010 * * 25.1010 

140207 ............................................................................. 1.3693 1.0846 23.3197 25.7331 24.1048 24.4812 

140208 ............................................................................. 1.6342 1.0846 27.4671 27.6586 29.4708 28.2131 

140209 ............................................................................. 1.5435 0.8844 22.0813 23.3886 24.4266 23.3169 

140210 ............................................................................. 1.0967 0.8285 15.5339 16.6729 19.2639 17.1406 

140211 ............................................................................. 1.3023 1.0846 25.8556 29.5114 29.7054 28.4947 

140213 ............................................................................. 1.1645 1.0846 27.4607 29.1649 30.2945 29.0178 

140215 ............................................................................. *** * 18.6962 22.3097 * 20.4262 

140217 ............................................................................. 1.4239 1.0846 24.7146 29.3711 31.5324 28.5274 

140223 ............................................................................. 1.4296 1.0846 27.4355 29.2540 30.4923 29.0769 

140224 ............................................................................. 1.3921 1.0846 27.1725 29.0350 28.2177 28.1560 

140228 ............................................................................. 1.5304 0.9975 22.9899 25.0074 25.6419 24.5738 

140231 ............................................................................. 1.4741 1.0846 25.5536 28.3545 30.6410 28.2754 

140233 ............................................................................. 1.5549 1.0698 24.7103 27.3379 28.6305 26.9841 

140234 ............................................................................. 1.0501 0.8844 20.8676 23.2604 23.6928 22.6766 

140239 ............................................................................. 1.5495 0.9975 23.9205 24.2112 29.0092 25.6976 

140240 ............................................................................. 1.3929 1.0846 25.0325 27.2654 31.8945 27.8715 

140242 ............................................................................. 1.4842 1.0846 28.8686 30.4005 32.0522 30.5576 

140245 ............................................................................. 0.9866 0.8285 15.2537 16.0772 * 15.6642 

140246 ............................................................................. *** 0.8285 16.1305 * * 16.1305 

140251 ............................................................................. 1.2806 1.0846 24.8256 26.7266 27.1870 26.2433 

140252 ............................................................................. 1.3977 1.0846 28.3479 30.2656 33.3885 30.8286 

140258 ............................................................................. 1.5252 1.0846 27.5741 27.9478 30.2639 28.6430 

140271 ............................................................................. 0.8733 0.8285 17.5174 18.8535 * 18.2163 

140275 ............................................................................. 1.2740 0.8716 23.1871 25.2824 26.1473 24.8583 

140276 ............................................................................. 1.7772 1.0846 25.3222 27.5936 29.1983 27.3299 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23501 

TABLE 2.—HOSPITAL CASE-MIX INDEXES FOR DISCHARGES OCCURRING IN FEDERAL FISCAL YEAR 2004; HOSPITAL AVERAGE HOURLY WAGE FOR FEDERAL FISCAL YEARS 2004 (2000 WAGE DATA), 2005 (2001 WAGE DATA), AND 2006 

(2002 WAGE DATA) WAGE INDEXES AND 3-YEAR AVERAGE OF HOSPITAL AVERAGE HOURLY WAGES—Continued 

Provider number Case-mix 

index 

Wage index 

FY 2006 

Average 

hourly wage 

FY 2004 

Average 

hourly wage 

FY 2005 

Average 

hourly wage 

FY 2006 

Average 

hourly 

wage ** 

(3 years) 

140280 ............................................................................. 1.4521 0.8716 21.7004 21.9302 23.4343 22.3632 

140281 ............................................................................. 1.6920 1.0846 27.9115 29.2602 30.4849 29.2420 

140285 ............................................................................. *** 0.8879 * 17.7824 20.7576 19.1679 

140286 ............................................................................. 1.1088 1.0846 25.5805 28.4378 29.1543 27.7906 

140288 ............................................................................. 1.5237 1.0846 26.3572 26.9581 29.3988 27.5648 

140289 ............................................................................. 1.3248 0.8953 20.7506 22.3274 22.6211 21.9308 

140290 ............................................................................. 1.3237 1.0846 29.9098 28.6926 31.7341 30.1371 

140291 ............................................................................. 1.2597 1.0698 27.6675 28.2338 29.8958 28.6610 

140292 ............................................................................. 1.1534 1.0846 26.4077 26.1781 27.6230 26.7673 

140294 ............................................................................. 1.1263 0.8285 21.7473 22.6123 23.4504 22.6034 

140300 ............................................................................. 1.1599 1.0846 30.5172 33.3983 34.8568 32.8808 

140301 ............................................................................. 1.1555 1.0846 * * 31.7073 31.7073 

150001 ............................................................................. 1.1532 0.9922 25.4897 27.1021 29.6844 27.4774 

150002 ............................................................................. 1.3813 1.0698 22.3327 23.3804 25.0063 23.5866 

150003 ............................................................................. 1.6528 0.8730 21.0944 23.3196 25.3458 23.2610 

150004 ............................................................................. 1.5181 1.0698 23.6169 24.8884 26.8458 25.1066 

150005 ............................................................................. 1.1975 0.9922 23.8818 25.4443 27.2369 25.6152 

150006 ............................................................................. 1.2943 0.9785 23.1779 24.8976 26.4061 24.8616 

150007 ............................................................................. 1.2960 0.9555 22.1098 23.5841 26.6073 24.2353 

150008 ............................................................................. 1.4015 1.0698 23.8916 23.6953 26.6928 24.7814 

150009 ............................................................................. 1.3653 0.9264 19.4763 20.4993 22.2147 20.7473 

150010 ............................................................................. 1.3255 0.9555 22.5445 23.9740 26.8524 24.4792 

150011 ............................................................................. 1.1602 0.9776 22.1559 23.2249 24.3490 23.2593 

150012 ............................................................................. 1.5342 0.9785 23.1644 22.9314 27.3031 24.2924 

150013 ............................................................................. 0.9799 0.8632 19.8564 19.7689 21.8465 20.4949 

150014 ............................................................................. 1.2880 0.9922 24.3754 26.5785 * 25.4309 

150015 ............................................................................. 1.3161 1.0698 23.1616 24.3015 26.2434 24.6064 

150017 ............................................................................. 1.8224 0.9797 22.7979 23.7180 25.2342 23.9446 

150018 ............................................................................. 1.6280 0.9616 24.6138 24.7048 26.3289 25.2344 

150019 ............................................................................. 1.0534 0.8632 17.3170 * * 17.3170 

150021 ............................................................................. 1.7262 0.9797 24.3658 27.8168 29.6967 27.2581 

150022 ............................................................................. 1.0471 0.8632 22.2973 22.8035 22.6773 22.6089 

150023 ............................................................................. 1.5248 0.8632 20.6926 23.1253 23.7159 22.4697 

150024 ............................................................................. 1.3936 0.9922 21.7593 24.7879 27.1589 24.7582 

150026 ............................................................................. 1.2781 0.9616 23.2169 23.7185 28.1127 25.1166 

150027 ............................................................................. 0.9951 0.9922 21.5766 21.2855 17.4862 19.9164 

150029 ............................................................................. 1.4269 0.9785 25.2067 23.4103 26.9680 25.0754 

150030 ............................................................................. 1.2034 0.9776 23.0196 24.4361 26.9533 24.8565 

150031 ............................................................................. 1.0678 0.8632 18.9180 * * 18.9180 

150034 ............................................................................. 1.4639 0.9366 22.8812 23.9388 26.0465 24.3610 

150035 ............................................................................. 1.4585 0.9366 23.5468 26.0952 26.6620 25.4702 

150037 ............................................................................. 1.2877 0.9922 24.4997 27.7009 28.5451 26.8949 

150038 ............................................................................. 1.0995 0.9922 21.6608 24.4188 28.8054 24.9650 

150042 ............................................................................. 1.3907 0.8632 23.7838 21.9917 23.0102 22.8781 

150044 ............................................................................. 1.3121 0.9264 20.5156 23.1200 23.7065 22.4683 

150045 h ........................................................................... 1.0499 0.9797 23.0361 24.2899 25.2225 24.2205 

150046 ............................................................................. 1.4135 0.8632 20.3453 21.0417 21.9369 21.1254 

150047 ............................................................................. 1.7002 0.9797 24.8786 24.5455 25.8349 25.1035 

150048 ............................................................................. 1.3259 0.9604 22.5181 24.5864 27.1817 24.7509 

150049 ............................................................................. 1.1169 0.8632 18.4942 20.2178 22.3370 20.2342 

150051 ............................................................................. 1.5540 0.8632 21.4009 22.6866 23.7061 22.5941 

150052 h ........................................................................... 1.0320 0.9264 19.1070 19.6073 20.6339 19.7871 

150056 ............................................................................. 1.8253 0.9922 24.7841 27.6754 28.2842 26.9368 

150057 ............................................................................. 2.0135 0.9922 28.0884 22.7804 24.8605 24.9551 

150058 ............................................................................. 1.5550 0.9785 24.9479 26.9753 27.5341 26.5322 

150059 ............................................................................. 1.5671 0.9922 25.6738 27.0792 28.5715 27.1975 

150060 ............................................................................. 1.0728 0.8632 19.8990 23.2409 24.8544 22.6276 

150061 ............................................................................. 1.1040 0.8632 19.2826 21.3640 22.2822 20.9919 

150062 ............................................................................. 1.1136 0.8632 22.9214 23.5550 24.6088 23.7293 

150063 ............................................................................. *** * 24.4091 19.0377 * 21.8339 

150064 ............................................................................. 1.1597 0.8632 21.2512 21.6370 23.7707 22.2400 

150065 ............................................................................. 1.2439 0.9776 23.0636 24.4451 25.9461 24.5094 

150067 ............................................................................. 1.0162 0.8632 21.4374 * * 21.4374 

150070 ............................................................................. 0.9415 0.8632 20.7413 22.6260 * 21.7117 

150072 ............................................................................. 1.1999 0.8632 18.5447 20.3191 20.5111 19.8274 

150073 ............................................................................. *** * 14.8287 * * 14.8287 

150075 ............................................................................. 1.0759 0.9797 20.1119 24.2085 24.0745 22.8038 

23502 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

TABLE 2.—HOSPITAL CASE-MIX INDEXES FOR DISCHARGES OCCURRING IN FEDERAL FISCAL YEAR 2004; HOSPITAL AVERAGE HOURLY WAGE FOR FEDERAL FISCAL YEARS 2004 (2000 WAGE DATA), 2005 (2001 WAGE DATA), AND 2006 

(2002 WAGE DATA) WAGE INDEXES AND 3-YEAR AVERAGE OF HOSPITAL AVERAGE HOURLY WAGES—Continued 

Provider number Case-mix 

index 

Wage index 

FY 2006 

Average 

hourly wage 

FY 2004 

Average 

hourly wage 

FY 2005 

Average 

hourly wage 

FY 2006 

Average 

hourly 

wage ** 

(3 years) 

150076 ............................................................................. 1.2278 0.9785 25.4519 24.1434 28.1874 25.9085 

150078 ............................................................................. 0.9426 0.8632 20.1259 21.2476 21.9771 21.1303 

150079 ............................................................................. 1.0871 0.9264 19.3860 20.6486 21.4067 20.5165 

150082 ............................................................................. 1.7137 0.8735 21.0651 22.2054 25.5860 22.9776 

150084 ............................................................................. 1.7636 0.9922 27.8354 28.7722 29.3905 28.6939 

150086 ............................................................................. 1.2074 0.9604 21.5815 22.4471 23.9404 22.7151 

150088 ............................................................................. 1.2662 0.9776 22.2627 23.0998 23.6253 23.0168 

150089 ............................................................................. 1.4706 0.8952 21.6806 22.6545 25.0449 23.0977 

150090 ............................................................................. 1.4690 1.0698 24.9021 24.6758 26.2899 25.3163 

150091 h ........................................................................... 1.0853 0.9797 26.4248 27.8087 30.6209 28.2762 

150096 ............................................................................. 0.9741 0.8632 19.7975 21.9091 23.8092 21.8206 

150097 ............................................................................. 1.0577 0.9922 22.4564 24.4179 25.0367 24.0346 

150100 ............................................................................. 1.6892 0.8735 21.2980 22.2687 24.3530 22.6387 

150101 ............................................................................. 1.0267 0.9797 26.1271 27.9745 29.1657 27.6430 

150102 ............................................................................. 1.0711 0.9366 21.3313 22.6870 24.5923 22.8112 

150104 ............................................................................. 1.0414 0.9922 21.0799 21.8172 25.5871 22.8454 

150106 h ........................................................................... 1.0517 0.9797 19.1976 20.9955 20.9387 20.4063 

150109 ............................................................................. 1.3698 0.8730 23.4642 24.3786 23.5865 23.8124 

150112 ............................................................................. 1.4147 0.9776 23.5151 24.7455 26.5643 24.9478 

150113 ............................................................................. 1.1907 0.9776 21.2412 23.0450 24.8760 23.1460 

150115 ............................................................................. 1.3246 0.8632 20.3863 20.5215 19.3411 20.0486 

150122 ............................................................................. 1.1182 0.8632 22.2752 24.2471 26.0173 24.2508 

150123 ............................................................................. *** 0.8735 15.5997 15.3050 * 15.4580 

150124 ............................................................................. 1.1187 0.8632 17.9063 18.8218 21.3933 19.4269 

150125 ............................................................................. 1.4937 1.0698 23.1464 24.3872 26.7666 24.8140 

150126 ............................................................................. 1.4161 1.0698 24.1917 25.5585 26.9887 25.6255 

150128 ............................................................................. 1.3711 0.9922 20.9869 23.1660 26.4976 23.5710 

150129 ............................................................................. 1.1881 0.9922 34.3166 35.4311 29.9099 32.9368 

150130 ............................................................................. 1.0196 0.8735 18.5578 21.5678 21.7399 20.5294 

150132 ............................................................................. 1.3880 1.0698 22.2707 24.2559 25.6257 24.1021 

150133 ............................................................................. 1.2457 0.9797 21.8807 21.8839 22.7293 22.1682 

150134 ............................................................................. 1.0951 0.9264 20.7680 22.1085 23.8526 22.2228 

150136 ............................................................................. *** 0.9922 25.8467 25.7004 26.2703 25.9403 

150146 ............................................................................. 1.0119 0.9797 25.1827 26.1168 29.3383 26.7878 

150147 ............................................................................. 1.1985 1.0698 * 32.3336 22.8456 26.0420 

150148 ............................................................................. *** * 26.2188 27.2081 * 26.7661 

150149 ............................................................................. 0.9756 0.8735 * 23.8554 23.6361 23.7419 

150150 ............................................................................. 1.2639 0.9797 * 26.5138 25.5331 26.0172 

150151 ............................................................................. *** * * * 38.1446 38.1446 

150152 ............................................................................. *** 0.9922 * * 44.7143 44.7143 

160001 ............................................................................. 1.1965 0.9231 22.8426 23.8657 25.1220 23.9155 

160002 ............................................................................. *** 0.8563 19.9607 * * 19.9607 

160005 ............................................................................. 1.1819 0.8563 20.3313 21.1745 21.8950 21.1337 

160008 ............................................................................. 1.0624 0.8563 17.9463 19.8066 20.7200 19.4883 

160013 ............................................................................. 1.2044 0.8563 21.0541 23.0163 23.7163 22.5118 

160014 ............................................................................. 0.9866 0.8563 18.3097 19.2447 20.9256 19.5050 

160016 ............................................................................. 1.5746 0.9413 21.8400 21.2785 23.3031 22.1576 

160020 ............................................................................. 1.0649 0.8563 16.6092 19.0043 19.5752 18.4226 

160024 ............................................................................. 1.5772 0.9650 22.4256 24.2385 26.2392 24.3248 

160026 ............................................................................. 0.9843 0.9231 22.8967 24.2045 24.7424 23.9779 

160028 ............................................................................. 1.3058 0.9555 25.1998 26.0052 26.2948 25.8671 

160029 ............................................................................. 1.6068 0.9751 23.7268 24.9493 27.9277 25.5651 

160030 ............................................................................. 1.2629 0.9546 23.3687 24.9920 26.7068 25.0247 

160031 ............................................................................. 0.9566 0.8563 17.8994 18.5281 19.7585 18.7487 

160032 ............................................................................. 1.0533 0.8563 20.5024 22.3837 23.4727 22.1329 

160033 ............................................................................. 1.7259 0.8716 22.2660 23.4148 24.6768 23.4865 

160034 ............................................................................. 0.9398 0.8563 19.0684 19.4837 19.3503 19.3060 

160039 ............................................................................. 0.9260 0.8563 19.8851 20.9623 22.1629 21.0029 

160040 ............................................................................. 1.2162 0.8564 20.0567 21.8187 23.9053 21.9454 

160043 ............................................................................. *** 0.8563 15.5765 * * 15.5765 

160045 ............................................................................. 1.6924 0.8605 22.1285 24.4957 25.4153 24.0445 

160047 ............................................................................. 1.3599 0.9555 22.1550 24.5000 25.2072 23.9813 

160048 ............................................................................. 1.0546 0.8563 18.1174 19.5701 19.6431 19.1317 

160050 ............................................................................. 1.1022 0.8563 21.6247 23.8830 24.5403 23.3364 

160057 ............................................................................. 1.2499 0.9574 20.8345 22.0472 23.2913 22.0638 

160058 ............................................................................. 1.8388 0.9751 23.5663 25.5244 27.1646 25.4595 

160064 ............................................................................. 1.5830 0.8563 23.8367 27.6301 28.6139 26.8350 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23503 

TABLE 2.—HOSPITAL CASE-MIX INDEXES FOR DISCHARGES OCCURRING IN FEDERAL FISCAL YEAR 2004; HOSPITAL AVERAGE HOURLY WAGE FOR FEDERAL FISCAL YEARS 2004 (2000 WAGE DATA), 2005 (2001 WAGE DATA), AND 2006 

(2002 WAGE DATA) WAGE INDEXES AND 3-YEAR AVERAGE OF HOSPITAL AVERAGE HOURLY WAGES—Continued 

Provider number Case-mix 

index 

Wage index 

FY 2006 

Average 

hourly wage 

FY 2004 

Average 

hourly wage 

FY 2005 

Average 

hourly wage 

FY 2006 

Average 

hourly 

wage ** 

(3 years) 

160066 ............................................................................. 1.0921 0.8563 20.4609 21.4631 22.7453 21.6034 

160067 ............................................................................. 1.3469 0.8564 19.9422 21.9418 23.4060 21.8952 

160069 ............................................................................. 1.4317 0.9116 21.7197 22.7514 25.8067 23.4426 

160072 ............................................................................. *** 0.8563 15.8236 * * 15.8236 

160076 ............................................................................. 0.9917 0.8563 20.1603 20.9749 * 20.5825 

160079 ............................................................................. 1.4983 0.8605 21.6562 22.5299 22.4291 22.2178 

160080 ............................................................................. 1.3105 0.9667 21.1713 23.5721 23.0138 22.5698 

160081 ............................................................................. 1.1704 0.8563 20.4415 21.3614 23.1930 21.6437 

160082 ............................................................................. 1.7449 0.9650 21.6230 23.8181 26.2453 23.8567 

160083 ............................................................................. 1.6465 0.9650 23.4670 25.0617 28.2193 25.6738 

160089 ............................................................................. 1.2795 0.9413 19.9688 21.5693 22.6551 21.4092 

160090 ............................................................................. 0.9949 0.8563 19.6767 21.2753 * 20.4851 

160091 ............................................................................. 0.9514 0.8563 16.1660 18.0630 17.9255 17.3725 

160092 ............................................................................. 0.9582 0.8563 20.4731 22.0841 * 21.2805 

160093 ............................................................................. *** 0.8605 22.8553 * * 22.8553 

160104 ............................................................................. 1.3676 0.8716 23.2832 24.0075 24.9134 24.0516 

160106 ............................................................................. 1.1242 0.8563 19.8905 21.4912 * 20.6919 

160107 ............................................................................. 1.0394 0.8563 19.5111 21.3754 * 20.4402 

160110 ............................................................................. 1.6369 0.8564 21.9299 24.1762 24.9434 23.7256 

160112 ............................................................................. 1.2659 0.8563 20.4038 21.8901 23.0673 21.8008 

160113 ............................................................................. 0.9601 0.8563 16.7574 18.6599 * 17.7162 

160114 ............................................................................. 0.9804 0.8563 19.1743 * * 19.1743 

160116 ............................................................................. 1.0412 0.8563 19.6923 22.2019 * 20.9445 

160117 ............................................................................. 1.2747 0.9116 22.3228 23.4250 25.0278 23.6002 

160118 ............................................................................. 1.0219 0.8563 16.9466 18.3322 19.7764 18.4025 

160122 ............................................................................. 1.0854 0.8563 21.2843 22.9565 22.5810 22.2832 

160124 ............................................................................. 1.1255 0.8563 21.2279 22.7223 23.1690 22.3848 

160126 ............................................................................. 1.0455 0.8563 20.0149 20.3748 19.6296 20.0068 

160131 ............................................................................. 0.9332 0.8563 18.0486 * * 18.0486 

160143 ............................................................................. 1.0569 0.8563 19.0623 * * 19.0623 

160147 ............................................................................. 1.2103 0.9231 22.7993 26.6577 25.1228 24.8830 

160153 ............................................................................. 1.5766 0.9360 23.5212 26.3671 28.9881 26.3386 

170001 ............................................................................. 1.1572 0.8032 19.8149 20.9837 21.9131 20.9143 

170006 ............................................................................. 1.2459 0.8458 19.4488 20.6460 21.9019 20.7240 

170008 ............................................................................. *** 0.8032 18.2352 * * 18.2352 

170010 ............................................................................. 1.2414 0.8313 20.6294 21.2131 24.0008 21.9435 

170012 ............................................................................. 1.6156 0.8946 21.8587 22.6869 24.7392 23.0750 

170013 ............................................................................. 1.5825 0.8946 21.4954 23.1159 24.9709 23.1630 

170014 ............................................................................. 0.9823 0.9454 21.3416 22.9772 23.5960 22.6522 

170015 ............................................................................. 1.0532 0.8032 18.0485 19.1902 20.2367 19.1620 

170016 ............................................................................. 1.6153 0.8921 22.9479 24.2336 25.9482 24.4090 

170017 ............................................................................. 1.1022 0.9156 21.6323 23.3030 24.7771 23.3226 

170018 ............................................................................. 0.8898 0.8032 16.9169 17.9497 17.2199 17.3753 

170019 ............................................................................. 1.2134 0.8032 18.7916 20.3243 22.0251 20.4068 

170020 ............................................................................. 1.5747 0.8946 20.6658 22.2571 23.1800 22.0586 

170022 ............................................................................. 1.0924 0.9454 21.1947 22.9313 22.2878 22.1486 

170023 ............................................................................. 1.4742 0.8946 21.6273 23.2690 22.5551 22.4908 

170024 ............................................................................. *** 0.8032 16.1196 * * 16.1196 

170026 ............................................................................. *** 0.8032 17.0836 * * 17.0836 

170033 ............................................................................. 1.3844 0.8946 20.0627 20.0801 20.5954 20.2325 

170034 ............................................................................. 0.8698 0.8032 18.1074 * * 18.1074 

170040 ............................................................................. 1.8787 0.9454 24.5234 27.1771 28.2856 26.8014 

170041 ............................................................................. *** 0.8032 13.9709 * * 13.9709 

170052 ............................................................................. 1.1985 0.8032 15.8809 17.3794 18.5291 17.3370 

170054 ............................................................................. 0.9966 0.8032 18.5239 17.5500 * 18.0250 

170056 ............................................................................. *** 0.8032 17.1872 * * 17.1872 

170068 ............................................................................. 1.1985 0.9165 20.5512 20.8771 22.6087 21.3531 

170070 ............................................................................. 1.0679 0.8032 15.0539 16.4767 16.0162 15.8428 

170074 ............................................................................. 1.1969 0.8032 18.5446 20.4936 21.0565 20.0516 

170075 ............................................................................. 0.8302 0.8032 15.6809 16.2047 16.5444 16.1586 

170077 ............................................................................. *** 0.8032 14.6377 * * 14.6377 

170082 ............................................................................. *** 0.8032 15.9973 * * 15.9973 

170086 ............................................................................. 1.5458 0.8921 22.1067 22.7737 24.0812 23.0117 

170090 ............................................................................. 0.9249 0.8032 16.3550 15.9807 * 16.1812 

170093 ............................................................................. 0.8184 0.8032 15.0307 16.8710 16.5553 16.1514 

170094 ............................................................................. 0.9938 0.8032 20.1253 20.3678 21.3887 20.6420 

170097 ............................................................................. 0.8884 0.8032 18.9865 20.3391 * 19.6594 

23504 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

TABLE 2.—HOSPITAL CASE-MIX INDEXES FOR DISCHARGES OCCURRING IN FEDERAL FISCAL YEAR 2004; HOSPITAL AVERAGE HOURLY WAGE FOR FEDERAL FISCAL YEARS 2004 (2000 WAGE DATA), 2005 (2001 WAGE DATA), AND 2006 

(2002 WAGE DATA) WAGE INDEXES AND 3-YEAR AVERAGE OF HOSPITAL AVERAGE HOURLY WAGES—Continued 

Provider number Case-mix 

index 

Wage index 

FY 2006 

Average 

hourly wage 

FY 2004 

Average 

hourly wage 

FY 2005 

Average 

hourly wage 

FY 2006 

Average 

hourly 

wage ** 

(3 years) 

170098 ............................................................................. 1.0009 0.8032 18.6676 20.0078 19.8881 19.5154 

170099 ............................................................................. 0.8971 0.8032 15.8117 * * 15.8117 

170103 ............................................................................. 1.2452 0.9156 20.1263 21.4985 22.8707 21.5590 

170104 ............................................................................. 1.5039 0.9454 23.6589 26.1866 26.6100 25.5135 

170105 ............................................................................. 1.0723 0.8032 18.3824 19.6687 21.4422 19.8723 

170109 ............................................................................. 0.9921 0.9454 20.7580 22.7166 23.2626 22.2703 

170110 ............................................................................. 0.9659 0.8032 16.5883 21.8904 22.2650 20.1717 

170113 ............................................................................. 1.0330 0.8032 19.9957 * * 19.9957 

170116 ............................................................................. 0.9958 0.8032 20.8800 23.1127 * 21.9980 

170120 ............................................................................. 1.2748 0.8458 18.5895 19.8723 21.0499 19.8632 

170122 ............................................................................. 1.6149 0.9156 22.2681 24.5826 25.3981 24.1100 

170123 ............................................................................. 1.6579 0.9156 25.0073 26.4676 27.2239 26.2255 

170133 ............................................................................. 1.0482 0.9454 20.0593 21.7748 22.9309 21.5574 

170137 ............................................................................. 1.2299 0.8032 21.4394 22.7676 23.8863 22.7099 

170142 ............................................................................. 1.3359 0.8785 19.8269 22.4095 22.5778 21.6027 

170143 ............................................................................. 1.1294 0.8032 18.0308 19.7643 20.4459 19.4072 

170144 ............................................................................. *** * 23.9180 24.4259 24.6260 24.3634 

170145 ............................................................................. 1.0646 0.8032 20.5143 21.4472 21.2071 21.0600 

170146 ............................................................................. 1.5346 0.9454 27.0312 28.1965 28.8062 28.0903 

170147 ............................................................................. 1.2185 0.9156 18.2480 23.1610 20.7436 20.6771 

170148 ............................................................................. *** * 26.3491 * * 26.3491 

170151 ............................................................................. 1.0014 0.8032 15.7242 * * 15.7242 

170171 ............................................................................. *** * 14.7251 * * 14.7251 

170176 ............................................................................. 1.2996 0.9454 25.5404 24.2283 26.2366 25.2863 

170180 ............................................................................. *** * 25.0935 * 25.1366 25.1166 

170182 ............................................................................. 1.4072 0.9454 23.2115 24.3820 25.7443 24.4497 

170183 ............................................................................. 1.9491 0.9156 19.6919 22.8633 24.5539 22.4468 

170185 ............................................................................. 1.2969 0.9454 26.8307 24.8478 26.7797 26.1506 

170186 ............................................................................. 2.9412 0.9156 28.5602 30.5157 31.7896 30.4381 

170187 ............................................................................. 1.1355 0.8032 20.8289 21.0780 23.3702 21.8354 

170188 ............................................................................. 2.0008 0.9454 25.2504 27.2225 29.9751 27.6756 

170189 ............................................................................. *** * 28.1996 * * 28.1996 

170191 ............................................................................. 1.1514 0.8032 * 24.9599 21.3069 23.1771 

170192 ............................................................................. 2.0555 0.9156 * * 27.0380 27.0380 

170193 ............................................................................. 1.2126 0.8032 * * 24.7430 24.7430 

170194 ............................................................................. 1.6735 0.9454 * * 27.9904 27.9904 

180001 ............................................................................. 1.2733 0.9604 22.2674 24.7647 25.4217 24.1342 

180002 ............................................................................. 1.0456 0.7788 20.5135 21.6843 22.9727 21.7424 

180004 ............................................................................. 1.0968 0.7788 19.8552 19.0834 19.5437 19.4871 

180005 ............................................................................. 1.1514 0.9119 22.6704 22.8871 24.5561 23.3888 

180006 ............................................................................. 0.8988 0.7788 14.4066 15.7136 14.8011 14.9439 

180007 ............................................................................. 1.4096 0.9060 21.3545 21.8724 22.7606 21.9873 

180009 ............................................................................. 1.6162 0.9482 22.4450 24.0971 25.3837 24.0052 

180010 ............................................................................. 1.9470 0.9060 22.6846 16.6893 24.7256 20.7808 

180011 ............................................................................. 1.3310 0.8830 18.8056 22.3183 22.7364 21.2726 

180012 ............................................................................. 1.4989 0.9264 20.2758 22.9096 24.6642 22.6125 

180013 ............................................................................. 1.4422 0.9492 21.0512 21.4728 22.9512 21.8902 

180016 ............................................................................. 1.3138 0.9264 20.5203 22.2148 23.1832 22.0005 

180017 ............................................................................. 1.2408 0.8286 18.0329 19.0694 20.8630 19.3296 

180018 ............................................................................. 1.3264 0.8830 17.5670 18.3314 19.0992 18.3166 

180019 ............................................................................. 1.1667 0.9604 20.8416 22.0379 24.1342 22.3292 

180020 ............................................................................. 1.0301 0.7788 20.9964 22.3477 21.9494 21.7537 

180021 ............................................................................. 1.0255 0.7788 17.6331 17.9346 18.5966 18.0522 

180024 ............................................................................. 1.1362 0.9264 22.3922 23.6826 32.1824 25.9352 

180025 ............................................................................. 1.0433 0.9264 18.3306 17.4781 19.1543 18.3232 

180026 ............................................................................. 1.1055 0.7788 15.5354 15.8431 18.2120 16.5328 

180027 ............................................................................. 1.2138 0.8092 20.5017 22.1072 23.8763 22.1722 

180028 ............................................................................. 0.8828 0.9119 20.6324 21.4766 24.7968 22.1418 

180029 ............................................................................. 1.2700 0.8095 20.4262 21.2110 23.0536 21.5776 

180035 ............................................................................. 1.5412 0.9604 24.3874 26.7702 29.8438 27.1206 

180036 ............................................................................. 1.1727 0.9482 22.2389 23.1636 25.1154 23.5250 

180037 ............................................................................. 1.2780 0.9264 22.7893 24.4451 25.7361 24.4985 

180038 ............................................................................. 1.3465 0.8806 20.6888 22.2750 24.6348 22.4970 

180040 ............................................................................. 2.0835 0.9264 23.2341 24.5590 26.2125 24.7248 

180041 ............................................................................. 1.0740 0.7788 19.1325 18.5483 * 18.8494 

180043 ............................................................................. 1.1986 0.7788 20.6498 18.8436 19.0617 19.4791 

180044 ............................................................................. 1.5046 0.9119 21.8163 21.6837 23.0971 22.1791 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23505 

TABLE 2.—HOSPITAL CASE-MIX INDEXES FOR DISCHARGES OCCURRING IN FEDERAL FISCAL YEAR 2004; HOSPITAL AVERAGE HOURLY WAGE FOR FEDERAL FISCAL YEARS 2004 (2000 WAGE DATA), 2005 (2001 WAGE DATA), AND 2006 

(2002 WAGE DATA) WAGE INDEXES AND 3-YEAR AVERAGE OF HOSPITAL AVERAGE HOURLY WAGES—Continued 

Provider number Case-mix 

index 

Wage index 

FY 2006 

Average 

hourly wage 

FY 2004 

Average 

hourly wage 

FY 2005 

Average 

hourly wage 

FY 2006 

Average 

hourly 

wage ** 

(3 years) 

180045 ............................................................................. 1.3290 0.9604 22.1027 24.5856 25.8349 24.1325 

180046 ............................................................................. 1.0500 0.9060 23.1139 24.7562 27.2244 25.0514 

180047 ............................................................................. 0.8429 0.7788 17.8574 20.4768 21.8037 20.0588 

180048 ............................................................................. 1.2624 0.9264 20.0114 22.3601 21.6571 21.3621 

180049 h ........................................................................... 1.3812 0.9060 18.5188 19.4488 23.3407 20.4067 

180050 ............................................................................. 1.1118 0.7788 19.9082 21.7150 22.6473 21.3727 

180051 ............................................................................. 1.3901 0.8272 18.8186 19.2100 21.3312 19.7863 

180053 ............................................................................. 1.0384 0.7788 17.6239 18.6610 19.1578 18.5083 

180054 ............................................................................. 0.9619 0.7788 19.1340 19.0657 * 19.0979 

180055 h ........................................................................... 1.0038 0.9060 17.8704 21.1989 20.7237 19.9661 

180056 ............................................................................. 1.0631 0.8735 19.4072 21.4695 22.8910 21.2490 

180063 ............................................................................. 1.1680 0.7788 15.5078 15.9185 17.9741 16.5674 

180064 ............................................................................. 1.2463 0.7788 21.1067 15.3819 16.2638 17.3349 

180066 ............................................................................. 1.0468 0.9492 21.1884 24.6359 24.9543 23.6588 

180067 ............................................................................. 1.9180 0.9060 22.0056 24.0551 25.4080 23.7960 

180069 ............................................................................. 1.0456 0.9119 20.3982 20.8797 22.3674 21.2166 

180070 ............................................................................. 1.1131 0.7788 16.9892 17.4266 20.1308 18.1917 

180072 ............................................................................. *** * 17.5411 * * 17.5411 

180079 ............................................................................. 1.1252 0.7788 18.0472 19.5783 19.7791 19.1405 

180080 ............................................................................. 1.3087 0.8470 18.9582 20.1651 21.7380 20.2813 

180087 ............................................................................. 1.1742 0.7788 16.4726 17.7758 18.4331 17.6017 

180088 ............................................................................. 1.5651 0.9264 23.7217 24.6053 27.5767 25.3642 

180092 ............................................................................. 1.1282 0.9060 19.6790 22.4864 22.5679 21.6047 

180093 ............................................................................. 1.4227 0.8508 18.8469 19.2748 20.5422 19.5520 

180094 ............................................................................. 0.9602 0.7788 15.7640 * * 15.7640 

180099 ............................................................................. *** 0.7788 14.0115 * * 14.0115 

180102 ............................................................................. 1.5476 0.8092 20.1885 19.1136 18.4388 19.1595 

180103 ............................................................................. 2.2069 0.9060 21.3867 25.1577 26.9407 24.4722 

180104 ............................................................................. 1.6243 0.8092 21.3866 22.8911 24.9441 23.1113 

180105 ............................................................................. 0.8484 0.7788 18.3521 19.5364 19.7615 19.2381 

180106 ............................................................................. 0.9458 0.7788 15.4937 15.7851 17.8020 16.4485 

180108 ............................................................................. *** 0.7788 16.7327 * * 16.7327 

180116 ............................................................................. 1.2066 0.8285 20.5453 21.8698 22.7353 21.7465 

180117 ............................................................................. 0.9835 0.7788 17.7885 20.5952 21.1854 19.7909 

180120 ............................................................................. 0.7761 0.7788 20.4507 * * 20.4507 

180124 ............................................................................. 1.3086 0.9492 20.5369 21.4270 23.1917 21.6877 

180126 ............................................................................. 1.0372 0.7788 14.5644 15.1776 * 14.8844 

180127 ............................................................................. 1.2754 0.9264 20.0059 21.4633 23.4765 21.6735 

180128 ............................................................................. 0.9399 0.7788 19.8502 20.5575 20.8406 20.4307 

180129 ............................................................................. *** 0.7788 14.1861 * * 14.1861 

180132 ............................................................................. 1.3264 0.8830 19.9358 22.2101 23.7652 21.9796 

180134 ............................................................................. 1.0635 0.7788 * 17.3449 18.6779 18.0324 

180138 ............................................................................. 1.2100 0.9264 23.0996 25.1789 27.3400 25.1767 

180139 ............................................................................. 1.0372 0.8830 20.6287 21.3797 23.5363 21.8425 

180141 ............................................................................. 1.7146 0.9264 22.6722 24.3140 25.3042 24.1450 

180143 ............................................................................. 1.4820 0.9060 20.1309 14.2734 25.1613 19.0124 

190001 ............................................................................. 1.0754 0.9003 20.4946 19.5680 19.7516 19.8963 

190002 ............................................................................. 1.7155 0.8429 20.7172 21.7000 22.0056 21.4744 

190003 ............................................................................. 1.4560 0.8429 20.7505 21.8156 23.4977 22.0368 

190004 ............................................................................. 1.2890 0.7903 20.5272 22.1835 23.3290 21.9727 

190005 ............................................................................. 1.4326 0.9003 20.0551 20.7987 22.3208 21.0635 

190006 ............................................................................. 1.2504 0.8429 18.8115 19.4573 22.2467 20.1618 

190007 ............................................................................. 1.1174 0.7445 17.9392 18.7854 19.7528 18.8587 

190008 ............................................................................. 1.6429 0.7903 20.3278 21.4137 24.0111 21.9572 

190009 ............................................................................. 1.2155 0.8048 17.5144 18.8295 19.8404 18.6932 

190010 ............................................................................. 1.1212 0.7445 18.1797 19.9788 21.6889 19.9508 

190011 ............................................................................. 1.0256 0.8044 15.4699 18.1525 19.7319 17.7235 

190013 ............................................................................. 1.3334 0.7847 18.7538 19.6346 20.8626 19.7509 

190014 ............................................................................. 1.1677 0.7445 17.0630 17.4740 22.4596 18.7727 

190015 ............................................................................. 1.3076 0.9003 20.6167 22.1046 22.8875 21.9289 

190017 h ........................................................................... 1.3418 0.8429 18.3528 18.6962 21.5033 19.4006 

190018 ............................................................................. *** 0.7445 19.2055 * * 19.2055 

190020 ............................................................................. 1.1401 0.8605 18.5659 19.8505 21.6136 19.9828 

190025 ............................................................................. 1.2473 0.7445 19.9969 20.4651 20.8950 20.4776 

190026 ............................................................................. 1.5166 0.8048 19.9229 21.3386 22.5087 0121.3125 

190027 ............................................................................. 1.6352 0.7847 19.4057 21.2449 21.2526 20.6470 

190034 ............................................................................. 1.1567 0.7445 16.8439 17.5002 19.6943 18.0127 

23506 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

TABLE 2.—HOSPITAL CASE-MIX INDEXES FOR DISCHARGES OCCURRING IN FEDERAL FISCAL YEAR 2004; HOSPITAL AVERAGE HOURLY WAGE FOR FEDERAL FISCAL YEARS 2004 (2000 WAGE DATA), 2005 (2001 WAGE DATA), AND 2006 

(2002 WAGE DATA) WAGE INDEXES AND 3-YEAR AVERAGE OF HOSPITAL AVERAGE HOURLY WAGES—Continued 

Provider number Case-mix 

index 

Wage index 

FY 2006 

Average 

hourly wage 

FY 2004 

Average 

hourly wage 

FY 2005 

Average 

hourly wage 

FY 2006 

Average 

hourly 

wage ** 

(3 years) 

190036 ............................................................................. 1.6456 0.9003 23.3903 23.7356 24.8359 24.0024 

190037 ............................................................................. 0.9457 0.7847 15.6062 16.7629 18.6393 17.0499 

190039 ............................................................................. 1.4625 0.9003 20.4900 23.3105 25.6665 23.2338 

190040 ............................................................................. 1.3133 0.9003 22.9262 23.8076 26.7428 24.3506 

190041 ............................................................................. 1.4459 0.8767 21.9983 23.9082 24.6734 23.4433 

190043 ............................................................................. 1.0017 0.7445 15.7333 16.8944 17.3477 16.6784 

190044 h ........................................................................... 1.2058 0.8429 17.7460 19.5304 19.5567 18.9595 

190045 ............................................................................. 1.5902 0.9003 22.8709 24.0490 25.3854 24.1220 

190046 ............................................................................. 1.4233 0.9003 21.1019 22.2884 24.2128 22.4847 

190048 ............................................................................. 1.0523 0.7445 18.1698 18.6148 19.6288 18.7855 

190049 ............................................................................. 1.0149 0.7445 19.3768 20.1229 * 19.7625 

190050 ............................................................................. 1.0741 0.7445 18.6663 18.5287 19.1076 18.7685 

190053 ............................................................................. 1.1232 0.7445 13.8037 15.7258 16.4968 15.3819 

190054 ............................................................................. 1.3671 0.7445 19.9370 20.3525 20.1108 20.1339 

190059 ............................................................................. 0.8367 0.8605 18.3334 19.2396 * 18.7888 

190060 ............................................................................. 1.5006 0.7847 20.2207 22.1499 23.6278 21.9859 

190064 ............................................................................. 1.5577 0.8605 21.1262 21.5514 23.3617 22.0132 

190065 ............................................................................. 1.4890 0.8605 20.3583 23.0523 23.7450 22.3992 

190077 ............................................................................. 0.8526 0.8044 17.0480 18.4043 18.8409 18.0986 

190078 h ........................................................................... 1.0049 0.8429 19.8607 21.5782 21.3786 20.9721 

190079 ............................................................................. 1.2488 0.9003 20.5000 21.8158 21.2546 21.1972 

190081 ............................................................................. 0.8882 0.7445 11.4756 14.9141 15.6146 13.9838 

190083 ............................................................................. 0.8728 0.7445 18.4954 19.2683 * 18.9013 

190086 ............................................................................. 1.2357 0.8767 18.2005 18.8306 19.8823 18.9783 

190088 h ........................................................................... 1.0702 0.8767 18.6738 22.5045 22.3480 20.9939 

190089 ............................................................................. 0.9609 0.7445 15.5151 16.2961 * 15.9103 

190090 ............................................................................. 1.0843 0.7445 19.0519 20.0745 20.2045 19.8076 

190095 ............................................................................. *** * 16.9519 18.7302 18.0174 17.8930 

190098 ............................................................................. 1.5840 0.8767 20.7537 23.0802 24.6353 22.7792 

190099 ............................................................................. 1.0296 0.8470 23.1606 21.1657 20.4597 21.4552 

190102 ............................................................................. 1.6258 0.8429 22.0190 23.4618 25.2267 23.6255 

190106 ............................................................................. 1.2114 0.8048 20.3114 21.5643 21.7228 21.2163 

190109 ............................................................................. 1.1376 0.7903 16.6515 17.4842 18.6524 17.5941 

190110 h ........................................................................... 0.8513 0.8429 16.5007 19.0611 * 17.8105 

190111 ............................................................................. 1.5580 0.8767 24.4380 25.2370 24.4998 24.7275 

190114 ............................................................................. 1.0513 0.7445 13.6101 14.6258 15.8031 14.6821 

190115 ............................................................................. 1.1772 0.8767 25.4984 26.0272 26.6295 26.0395 

190116 ............................................................................. 1.2394 0.7445 17.8297 18.6074 20.3844 18.9443 

190118 ............................................................................. 0.9389 0.8767 17.5060 19.0200 19.7025 18.7558 

190122 ............................................................................. 1.1878 0.8605 17.7811 19.3131 23.7082 20.0706 

190124 ............................................................................. 1.5270 0.9003 23.3859 23.4862 24.6675 23.8477 

190125 ............................................................................. 1.6350 0.8044 21.5692 22.3976 23.9649 22.6514 

190128 ............................................................................. 1.0700 0.8605 23.8786 24.7842 27.9136 25.5637 

190130 ............................................................................. 0.9482 0.7445 15.2678 16.6910 * 15.9880 

190131 ............................................................................. 1.1718 0.9003 21.3154 22.5032 25.1917 22.9740 

190133 ............................................................................. 0.8895 0.7445 13.4062 14.3089 13.6266 13.7628 

190135 ............................................................................. 1.4454 0.9003 24.4908 26.9920 26.8238 26.1247 

190140 ............................................................................. 0.9845 0.7445 15.4030 17.0371 17.6936 16.7104 

190144 h ........................................................................... 1.1367 0.8767 21.3838 21.1658 21.7547 21.4426 

190145 ............................................................................. 0.9459 0.7445 17.4407 17.3361 18.9678 17.9319 

190146 ............................................................................. 1.5445 0.9003 22.1502 23.7721 26.1792 24.0255 

190147 ............................................................................. *** 0.7445 16.3596 * * 16.3596 

190149 ............................................................................. 0.9266 0.7445 18.4197 17.1671 18.8819 18.1219 

190151 ............................................................................. 1.0072 0.7445 17.3402 17.8741 18.6293 17.9597 

190152 ............................................................................. 1.3530 0.9003 25.1136 27.4708 27.6099 26.7879 

190156 ............................................................................. 0.8717 0.7445 18.0528 18.3702 * 18.2089 

190158 ............................................................................. 1.3600 0.9003 23.2361 26.2352 26.3042 25.4140 

190160 ............................................................................. 1.4780 0.8044 19.8428 20.0025 21.6740 20.5204 

190161 ............................................................................. 1.1157 0.7847 16.5322 17.8794 19.1022 17.8227 

190162 ............................................................................. *** 0.9003 20.7350 22.1781 25.0328 22.6102 

190164 ............................................................................. 1.1345 0.8048 20.2791 21.4247 22.8599 21.6241 

190167 ............................................................................. 1.2264 0.7445 17.2643 17.8604 24.3185 19.7786 

190175 ............................................................................. 1.3314 0.9003 22.7574 24.6790 27.1531 25.0038 

190176 ............................................................................. 1.7308 0.9003 25.2536 25.8482 25.6997 25.6097 

190177 ............................................................................. 1.5627 0.9003 22.3318 25.4769 27.4621 25.2171 

190182 ............................................................................. 0.9036 0.9003 23.6016 25.0837 28.4799 25.6314 

190183 ............................................................................. 1.1870 0.7903 17.1805 18.3151 19.8084 18.4205 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23507 

TABLE 2.—HOSPITAL CASE-MIX INDEXES FOR DISCHARGES OCCURRING IN FEDERAL FISCAL YEAR 2004; HOSPITAL AVERAGE HOURLY WAGE FOR FEDERAL FISCAL YEARS 2004 (2000 WAGE DATA), 2005 (2001 WAGE DATA), AND 2006 

(2002 WAGE DATA) WAGE INDEXES AND 3-YEAR AVERAGE OF HOSPITAL AVERAGE HOURLY WAGES—Continued 

Provider number Case-mix 

index 

Wage index 

FY 2006 

Average 

hourly wage 

FY 2004 

Average 

hourly wage 

FY 2005 

Average 

hourly wage 

FY 2006 

Average 

hourly 

wage ** 

(3 years) 

190184 ............................................................................. 1.0174 0.7445 20.6096 21.3191 23.9609 21.8425 

190185 ............................................................................. 1.3314 0.9003 29.7870 24.4176 24.7912 25.8807 

190190 ............................................................................. 0.8693 0.7445 16.2819 14.0052 16.1195 15.4593 

190191 h ........................................................................... 1.3627 0.8470 21.9141 22.3755 23.5734 22.6642 

190196 ............................................................................. 0.8706 0.8429 20.7601 21.9355 24.7135 22.5497 

190197 ............................................................................. 1.3476 0.8044 21.6908 22.9631 24.3735 23.0241 

190199 ............................................................................. 1.1533 0.8605 19.7776 18.5317 14.1410 17.3575 

190200 ............................................................................. 1.5526 0.9003 24.1667 26.4258 27.5681 25.9873 

190201 ............................................................................. 1.2736 0.7847 21.4335 22.5588 24.5877 22.9165 

190202 ............................................................................. 1.2371 0.8605 22.4062 21.8900 24.7944 23.0825 

190203 ............................................................................. 1.5000 0.9003 24.9518 26.9099 26.8795 26.2979 

190204 ............................................................................. 1.4751 0.9003 26.1231 28.8777 28.3684 27.8932 

190205 ............................................................................. 1.7106 0.8429 20.2374 21.7696 24.4540 22.1979 

190206 ............................................................................. 1.6684 0.9003 24.2892 26.9117 26.0139 25.7960 

190207 ............................................................................. *** * 21.5325 * * 21.5325 

190218 ............................................................................. 1.1570 0.7445 21.6206 23.9182 25.0356 23.6192 

190236 ............................................................................. 1.4154 0.8767 24.4661 23.8233 23.6824 23.9582 

190240 ............................................................................. 0.9780 0.7445 15.4026 13.9888 * 14.7116 

190241 ............................................................................. 1.2944 0.7903 24.2462 28.9620 23.9700 25.7012 

190242 ............................................................................. 1.1208 0.8605 18.6672 20.5937 23.0072 20.7608 

190243 ............................................................................. *** * * 30.6060 * 30.6060 

190245 ............................................................................. 2.1960 0.8044 * * 27.1786 27.1786 

200001 ............................................................................. 1.2980 0.9985 21.6050 23.2210 25.1145 23.3710 

200002 ............................................................................. 1.1625 0.9884 22.0700 24.1446 25.7478 23.9468 

200007 ............................................................................. 1.0638 1.0382 21.0603 22.3920 * 21.7470 

200008 ............................................................................. 1.2535 1.0382 25.1115 25.1741 27.4412 25.9041 

200009 ............................................................................. 1.9724 1.0382 24.9041 28.1409 31.1056 28.0391 

200012 ............................................................................. 1.1372 0.8840 21.8529 24.1243 25.7623 23.9787 

200013 ............................................................................. 1.1001 0.8840 22.8909 23.9048 24.4131 23.7685 

200018 ............................................................................. 1.1627 0.8840 21.1330 24.3294 23.6337 23.0851 

200019 ............................................................................. 1.2839 1.0382 23.1114 24.0926 25.1367 24.1296 

200020 ............................................................................. 1.2562 1.0503 27.0798 28.7351 31.7083 29.2990 

200021 ............................................................................. 1.1892 1.0382 24.9925 25.1027 24.5519 24.8792 

200024 ............................................................................. 1.5272 0.9884 22.9698 24.6484 26.0080 24.6372 

200025 ............................................................................. 1.0696 1.0382 22.9023 24.3646 26.0573 24.4151 

200026 ............................................................................. 1.0384 0.8840 19.7172 21.9997 * 20.8927 

200027 ............................................................................. 1.2155 0.8840 21.0156 23.2912 26.3118 23.4478 

200028 ............................................................................. 1.0270 0.8840 21.2180 24.3061 24.3271 23.3297 

200031 ............................................................................. 1.3580 0.8840 18.8262 20.6202 21.9489 20.4626 

200032 ............................................................................. 1.2155 0.8840 23.0487 24.2221 25.5227 24.3050 

200033 ............................................................................. 1.8521 0.9985 25.1723 26.8727 28.6479 26.9328 

200034 ............................................................................. 1.3802 0.9884 23.5415 26.1150 26.2926 25.3574 

200037 ............................................................................. 1.1932 0.8840 22.6534 23.3490 23.2333 23.0870 

200039 ............................................................................. 1.2758 0.9884 22.1333 24.0474 25.1196 23.8217 

200040 ............................................................................. 1.2240 1.0382 21.8528 23.6791 25.5405 23.6763 

200041 ............................................................................. 1.1389 0.8840 21.3816 23.6797 24.5532 23.3316 

200050 ............................................................................. 1.2560 0.9985 23.4391 25.5233 26.4992 25.2144 

200052 ............................................................................. 1.0527 0.8840 19.0535 22.7763 21.8726 21.2769 

200063 ............................................................................. 1.1744 0.9884 23.0135 24.7235 25.0167 24.2686 

200066 ............................................................................. 1.2279 0.8840 19.5890 21.6354 * 20.6005 

210001 ............................................................................. 1.4095 0.9528 22.6614 26.3144 27.7561 25.5750 

210002 ............................................................................. 1.9808 0.9892 25.6975 25.2859 26.4992 25.8584 

210003 ............................................................................. 1.6574 1.0935 23.0790 32.3042 29.8684 28.0698 

210004 ............................................................................. 1.4432 1.1471 29.4841 29.4300 34.2392 31.0347 

210005 ............................................................................. 1.2836 1.1471 24.7185 27.1276 28.7557 26.8963 

210006 ............................................................................. 1.0893 0.9892 24.7327 25.6396 25.4081 25.2468 

210007 ............................................................................. 1.8793 0.9892 27.5104 28.4496 30.2548 28.7829 

210008 ............................................................................. 1.3153 0.9892 24.6569 26.3008 25.2833 25.4086 

210009 ............................................................................. 1.8013 0.9892 23.4889 24.6332 26.2360 24.8136 

210010 ............................................................................. *** 0.9099 23.7761 24.5071 25.7850 24.6945 

210011 ............................................................................. 1.4100 0.9892 22.3262 24.8373 27.5031 24.9589 

210012 ............................................................................. 1.5973 0.9892 25.2892 25.7934 27.4103 26.2116 

210013 ............................................................................. 1.2668 0.9892 23.0151 23.9875 25.1348 24.0450 

210015 ............................................................................. 1.3230 0.9892 23.8419 25.8532 28.2029 25.9683 

210016 ............................................................................. 1.8143 1.1471 27.2632 28.6992 32.2081 29.4293 

210017 ............................................................................. 1.1663 0.9099 19.0248 21.3983 23.2168 21.2523 

210018 ............................................................................. 1.2267 1.1471 25.3112 27.5431 29.2153 27.3955 

23508 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

TABLE 2.—HOSPITAL CASE-MIX INDEXES FOR DISCHARGES OCCURRING IN FEDERAL FISCAL YEAR 2004; HOSPITAL AVERAGE HOURLY WAGE FOR FEDERAL FISCAL YEARS 2004 (2000 WAGE DATA), 2005 (2001 WAGE DATA), AND 2006 

(2002 WAGE DATA) WAGE INDEXES AND 3-YEAR AVERAGE OF HOSPITAL AVERAGE HOURLY WAGES—Continued 

Provider number Case-mix 

index 

Wage index 

FY 2006 

Average 

hourly wage 

FY 2004 

Average 

hourly wage 

FY 2005 

Average 

hourly wage 

FY 2006 

Average 

hourly 

wage ** 

(3 years) 

210019 ............................................................................. 1.7403 0.9099 23.5259 24.9252 26.1824 24.9054 

210022 ............................................................................. 1.4002 1.1471 27.6680 30.1470 33.8015 30.5481 

210023 ............................................................................. 1.4502 0.9892 26.7837 29.0844 30.4656 28.8005 

210024 ............................................................................. 1.6742 0.9892 24.8939 27.1756 29.5579 27.2560 

210025 ............................................................................. 1.2278 0.9310 22.8882 23.8943 26.0771 24.3114 

210027 ............................................................................. 1.4821 0.9310 19.3517 23.9255 26.0111 22.9283 

210028 ............................................................................. 1.0800 0.9099 22.4054 24.1265 25.9221 24.1901 

210029 ............................................................................. 1.2469 0.9892 26.2082 31.2888 27.9741 28.3176 

210030 ............................................................................. 1.2604 0.9099 20.7802 27.5507 29.5702 25.7230 

210032 ............................................................................. 1.1336 1.0652 20.3407 25.7138 26.1829 23.9925 

210033 ............................................................................. 1.1618 0.9892 25.0301 26.6113 29.0420 26.9838 

210034 ............................................................................. 1.2910 0.9892 22.8827 26.3896 28.4308 25.7800 

210035 ............................................................................. 1.3279 1.0935 21.6973 24.5198 26.1082 24.1712 

210037 ............................................................................. 1.1827 0.9099 23.5536 24.1913 24.8719 24.2175 

210038 ............................................................................. 1.2100 0.9892 26.5696 28.3414 29.5979 28.1851 

210039 ............................................................................. 1.1063 1.0935 24.0987 25.8415 27.6940 25.8514 

210040 ............................................................................. 1.2556 0.9892 25.4729 28.3723 29.3514 27.8674 

210043 ............................................................................. 1.3070 0.9892 22.2177 24.3070 27.5657 24.7038 

210044 ............................................................................. 1.3455 0.9892 23.8101 24.8083 28.8700 25.7966 

210045 ............................................................................. 1.0505 0.9099 11.8350 15.0867 15.6380 14.3653 

210048 ............................................................................. 1.3334 0.9892 24.4328 25.0617 28.4638 26.0370 

210049 ............................................................................. 1.2251 0.9892 24.7148 25.9342 26.9656 25.9278 

210051 ............................................................................. 1.3202 1.0935 25.7103 27.3692 29.2998 27.5052 

210054 ............................................................................. 1.3345 1.0935 27.3551 24.6658 26.2295 26.0806 

210055 ............................................................................. 1.1840 1.0935 27.4218 28.0014 29.9708 28.5097 

210056 ............................................................................. 1.3191 0.9892 23.5881 26.6884 28.6091 26.3638 

210057 ............................................................................. 1.4185 1.1471 27.3520 29.2233 32.2883 29.7939 

210058 ............................................................................. 1.0819 0.9892 22.0351 24.8576 29.7841 25.5191 

210060 ............................................................................. 1.1664 1.0935 25.8377 28.7531 28.5087 27.8143 

210061 ............................................................................. 1.2457 0.9099 22.5455 24.1369 23.6662 23.5086 

220001 ............................................................................. 1.2068 1.1233 25.8030 27.3238 28.9854 27.3824 

220002 ............................................................................. 1.3775 1.1233 26.3348 28.9722 30.3598 28.5921 

220003 ............................................................................. 1.1465 1.1233 18.8150 20.5790 22.0549 20.5049 

220006 ............................................................................. 1.5005 1.0525 27.1576 29.5946 30.7583 29.2881 

220008 ............................................................................. 1.2473 1.0952 25.6647 27.1675 30.1043 27.7253 

220010 ............................................................................. 1.2849 1.1233 24.5020 27.4161 29.7998 27.3015 

220011 ............................................................................. 1.1320 1.1233 32.2266 32.6624 33.6258 32.9286 

220012 ............................................................................. 1.4769 1.2518 32.0521 32.9791 36.2075 33.8319 

220015 ............................................................................. 1.1789 1.0259 25.0272 25.5449 28.3397 26.3904 

220016 ............................................................................. 1.1162 1.0259 25.7740 26.8798 28.0609 26.8986 

220017 ............................................................................. 1.3302 1.1537 28.9024 28.8264 29.7108 29.1461 

220019 ............................................................................. 1.1847 1.1233 21.6620 22.2294 23.2544 22.3943 

220020 ............................................................................. 1.2561 1.0952 23.5737 24.2279 26.3475 24.7620 

220024 ............................................................................. 1.2397 1.0259 24.1071 25.5837 27.3488 25.6784 

220025 ............................................................................. 1.1085 1.1233 23.2374 24.5186 23.0637 23.5753 

220028 ............................................................................. 1.4399 1.1233 31.4858 31.3592 32.0980 31.6438 

220029 ............................................................................. 1.1188 1.1233 27.4792 28.1432 28.6970 28.1288 

220030 ............................................................................. 1.1096 1.0259 20.0816 23.6257 24.4289 22.7602 

220031 ............................................................................. 1.5358 1.1537 30.8324 32.2660 34.7388 32.5988 

220033 ............................................................................. 1.1835 1.1233 25.4500 26.8049 28.1859 26.8967 

220035 ............................................................................. 1.3734 1.1233 26.8486 27.5533 28.6238 27.6997 

220036 ............................................................................. 1.4886 1.1537 28.2182 29.6296 31.5184 29.8330 

220041 ............................................................................. *** * 28.8184 29.7464 * 29.2230 

220046 ............................................................................. 1.3512 1.0183 26.1955 27.7726 28.1396 27.3951 

220049 ............................................................................. 1.1526 1.1233 26.7688 27.0464 27.7517 27.2011 

220050 ............................................................................. 1.1149 1.0259 23.7326 24.9945 26.3768 25.0718 

220051 ............................................................................. 1.2065 1.0183 22.2965 26.5575 29.8380 26.3369 

220052 ............................................................................. 1.1597 1.1537 26.3043 28.0925 29.8577 28.1429 

220058 ............................................................................. 1.0018 1.1233 22.4885 25.0598 24.9642 24.1665 

220060 ............................................................................. 1.1851 1.2254 29.6960 30.8242 32.3362 31.0565 

220062 ............................................................................. 0.5670 1.1233 22.6598 21.9489 24.2779 22.9699 

220063 ............................................................................. 1.1890 1.1233 23.3704 25.5840 27.3967 25.3936 

220065 ............................................................................. 1.2103 1.0259 22.4143 24.8737 26.5513 24.6535 

220066 ............................................................................. 1.2809 1.0259 27.5575 26.2561 27.1317 26.9786 

220067 ............................................................................. 1.1716 1.1537 22.4968 28.5220 29.8911 26.7470 

220070 ............................................................................. 1.1474 1.1233 26.2697 28.9100 31.9283 28.7436 

220071 ............................................................................. 1.8635 1.1537 27.7773 31.8322 32.2591 30.6680 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23509 

TABLE 2.—HOSPITAL CASE-MIX INDEXES FOR DISCHARGES OCCURRING IN FEDERAL FISCAL YEAR 2004; HOSPITAL AVERAGE HOURLY WAGE FOR FEDERAL FISCAL YEARS 2004 (2000 WAGE DATA), 2005 (2001 WAGE DATA), AND 2006 

(2002 WAGE DATA) WAGE INDEXES AND 3-YEAR AVERAGE OF HOSPITAL AVERAGE HOURLY WAGES—Continued 

Provider number Case-mix 

index 

Wage index 

FY 2006 

Average 

hourly wage 

FY 2004 

Average 

hourly wage 

FY 2005 

Average 

hourly wage 

FY 2006 

Average 

hourly 

wage ** 

(3 years) 

220073 ............................................................................. 1.2181 1.0952 27.9309 29.2399 31.2591 29.4595 

220074 ............................................................................. 1.2979 1.1537 25.7840 27.5763 28.4930 27.3187 

220075 ............................................................................. 1.3687 1.1537 26.0527 27.9503 29.1588 27.7387 

220076 ............................................................................. *** 1.1078 24.8040 27.2534 29.7507 27.1315 

220077 ............................................................................. 1.7008 1.1085 27.0946 28.0935 30.2684 28.5352 

220080 ............................................................................. 1.2093 1.1233 24.7399 27.1578 28.9101 27.0523 

220082 ............................................................................. 1.2445 1.1233 23.9542 24.8060 26.9841 25.2609 

220083 ............................................................................. 1.1182 1.1537 28.3533 29.9001 32.9143 30.3719 

220084 ............................................................................. 1.2198 1.1233 26.8596 29.0505 32.5711 29.5958 

220086 ............................................................................. 1.7240 1.1537 29.4911 31.7482 34.1236 31.7544 

220088 ............................................................................. 1.8430 1.1537 26.5849 28.5711 28.5462 27.9606 

220089 ............................................................................. 1.2383 1.1233 28.9252 32.4409 31.1708 30.8836 

220090 ............................................................................. 1.2019 1.1233 26.5552 29.7945 30.8685 29.1558 

220095 ............................................................................. 1.0909 1.1233 23.7629 24.9871 27.4273 25.3894 

220098 ............................................................................. 1.1705 1.1233 26.2287 26.8538 28.8314 27.2888 

220100 ............................................................................. 1.2709 1.1537 27.0265 28.4848 29.6912 28.4369 

220101 ............................................................................. 1.3268 1.1233 26.9992 31.0834 33.1690 30.4912 

220105 ............................................................................. 1.2174 1.1233 26.7570 30.0892 31.9421 29.7099 

220108 ............................................................................. 1.2235 1.1537 26.0166 29.0804 30.6252 28.5516 

220110 ............................................................................. 2.0895 1.1537 33.0445 35.4242 36.6043 35.0919 

220111 ............................................................................. 1.1852 1.1537 27.7395 28.9092 31.1850 29.2950 

220116 ............................................................................. 2.0126 1.1537 30.9871 32.2337 32.9988 32.0845 

220119 ............................................................................. 1.1414 1.1537 25.9789 27.8372 28.2844 27.4417 

220126 ............................................................................. 1.1438 1.1537 26.9853 26.7660 28.7805 27.5408 

220133 ............................................................................. *** * 33.0819 31.2981 33.6003 32.6683 

220135 ............................................................................. 1.3023 1.2518 31.9159 31.3246 32.1205 31.7903 

220153 ............................................................................. 1.0112 1.0259 * 18.9267 * 18.9267 

220154 ............................................................................. 1.0325 1.1537 25.6069 30.9009 28.6462 28.0721 

220163 ............................................................................. 1.6217 1.1233 29.9312 30.5056 33.6484 31.2574 

220171 ............................................................................. 1.7280 1.1233 27.2647 28.9733 29.5666 28.6148 

220174 ............................................................................. 1.1830 1.1233 * 30.3356 31.7572 31.0464 

230001 ............................................................................. 1.1145 0.8923 22.0875 24.3660 * 23.2049 

230002 ............................................................................. 1.2858 1.0453 23.7972 27.0305 28.7861 26.5792 

230003 ............................................................................. 1.1978 0.9133 22.4322 25.2596 26.1278 24.6604 

230004 ............................................................................. 1.6865 0.9677 23.0827 25.5573 26.7206 25.1973 

230005 h ........................................................................... 1.2420 1.0885 20.3750 22.1018 24.1902 22.4061 

230006 ............................................................................. 1.1260 0.9786 22.0733 22.7656 23.8835 22.9495 

230013 ............................................................................. 1.3537 0.9858 20.4633 22.7014 23.7822 22.3686 

230015 ............................................................................. 1.0330 0.8923 21.7640 23.4512 24.6570 23.3267 

230017 ............................................................................. 1.6186 1.0403 26.1609 27.3259 29.5178 27.7392 

230019 ............................................................................. 1.5499 0.9858 24.7472 27.6563 28.4575 26.9496 

230020 ............................................................................. 1.6718 1.0453 25.8267 26.8516 29.2869 27.3788 

230021 ............................................................................. 1.5066 0.8923 22.0757 23.4663 24.9551 23.5352 

230022 ............................................................................. 1.1968 1.0628 22.2179 22.2528 23.3000 22.6032 

230024 ............................................................................. 1.5303 1.0453 24.7364 27.6555 30.0866 27.3402 

230027 ............................................................................. 1.0785 0.9398 21.2223 22.5736 23.5511 22.4431 

230029 ............................................................................. 1.6353 0.9858 26.7646 27.9012 29.0935 27.9121 

230030 ............................................................................. 1.2551 0.9090 19.9853 20.9867 22.3174 21.1301 

230031 ............................................................................. 1.3778 0.9858 22.1874 23.2910 25.4678 23.7275 

230032 ............................................................................. *** * 23.8366 * * 23.8366 

230035 ............................................................................. 1.2892 0.9398 18.0735 20.9197 21.2317 19.9973 

230036 ............................................................................. 1.3478 0.8923 25.9801 26.5854 28.3622 26.9984 

230037 ............................................................................. 1.1932 1.0628 24.4115 24.7875 26.0167 25.1030 

230038 ............................................................................. 1.6544 0.9398 23.4685 25.2499 26.3480 25.2371 

230040 ............................................................................. 1.1923 0.9398 21.8062 21.9813 24.2349 22.7262 

230041 ............................................................................. 1.4739 0.9535 24.2297 25.2518 26.1760 25.1852 

230042 ............................................................................. 1.1899 0.9133 21.8241 24.3640 26.2037 24.1687 

230046 ............................................................................. 1.8546 1.0885 28.2320 29.2683 30.3591 29.3515 

230047 ............................................................................. 1.3775 1.0453 24.3622 26.2447 28.1351 26.3210 

230053 ............................................................................. 1.5876 1.0453 26.1415 28.3030 29.9871 28.0856 

230054 ............................................................................. 2.0368 0.9439 23.0818 24.0137 24.9905 24.0601 

230055 ............................................................................. 1.2813 0.8923 20.9350 23.7671 25.4143 23.4450 

230058 ............................................................................. 1.1454 0.8923 22.4516 21.9308 24.0657 22.7966 

230059 ............................................................................. 1.4370 0.9398 21.2743 23.1451 25.5350 23.3695 

230060 ............................................................................. 1.2849 0.8923 22.3512 24.5073 25.5015 24.1280 

230065 ............................................................................. *** 1.0453 26.3217 27.9179 28.4631 27.5421 

230066 ............................................................................. 1.3075 0.9677 23.9696 25.8517 27.4928 25.8295 

23510 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

TABLE 2.—HOSPITAL CASE-MIX INDEXES FOR DISCHARGES OCCURRING IN FEDERAL FISCAL YEAR 2004; HOSPITAL AVERAGE HOURLY WAGE FOR FEDERAL FISCAL YEARS 2004 (2000 WAGE DATA), 2005 (2001 WAGE DATA), AND 2006 

(2002 WAGE DATA) WAGE INDEXES AND 3-YEAR AVERAGE OF HOSPITAL AVERAGE HOURLY WAGES—Continued 

Provider number Case-mix 

index 

Wage index 

FY 2006 

Average 

hourly wage 

FY 2004 

Average 

hourly wage 

FY 2005 

Average 

hourly wage 

FY 2006 

Average 

hourly 

wage ** 

(3 years) 

230069 ............................................................................. 1.1753 1.0654 26.0438 27.6815 29.5556 27.8051 

230070 ............................................................................. 1.5701 0.9474 22.8588 25.1587 24.2342 24.0769 

230071 ............................................................................. 0.8485 0.9858 23.6674 24.7707 26.3907 24.9681 

230072 ............................................................................. 1.3590 0.9133 22.9626 24.1560 24.4933 23.9114 

230075 ............................................................................. 1.3133 0.9492 22.6799 24.1482 27.6193 24.8869 

230077 ............................................................................. 1.9292 1.0654 29.2041 27.3117 30.3431 28.9610 

230078 ............................................................................. 1.0254 0.8923 20.5427 21.9200 23.9901 22.2077 

230080 ............................................................................. 1.2619 0.9090 20.2405 21.2840 21.2314 20.9185 

230081 ............................................................................. 1.1862 0.8923 20.4289 20.6777 23.0788 21.3975 

230082 ............................................................................. 1.0168 0.8923 21.3100 23.1240 22.2165 22.1964 

230085 ............................................................................. 1.2173 1.0403 24.2802 22.2569 22.7314 23.1872 

230086 ............................................................................. 1.1453 0.8923 27.8923 20.8759 22.2965 23.4562 

230087 ............................................................................. *** * 22.2688 * 16.9168 19.0752 

230089 ............................................................................. 1.3414 1.0453 23.3847 23.9486 28.7015 25.3973 

230092 ............................................................................. 1.2758 0.9300 22.3122 24.3768 26.3584 24.3257 

230093 ............................................................................. 1.1471 0.9398 25.1213 24.5055 26.4967 25.3702 

230095 ............................................................................. 1.2485 0.8923 19.1810 19.2244 21.3915 19.9401 

230096 ............................................................................. 1.1644 1.0403 26.7156 26.7578 28.7681 27.4077 

230097 ............................................................................. 1.7922 0.8923 22.9902 25.2104 26.5773 24.9608 

230099 ............................................................................. 1.2029 1.0628 23.5490 25.0390 26.4882 25.0486 

230100 ............................................................................. 1.0901 0.8923 19.8016 20.4565 21.8895 20.6965 

230101 ............................................................................. 1.0867 0.8923 22.3310 23.1349 24.3772 23.3147 

230103 ............................................................................. 0.9926 0.9786 19.4434 18.4304 21.6609 19.7646 

230104 ............................................................................. 1.5316 1.0453 27.4119 27.8864 30.5570 28.5801 

230105 ............................................................................. 1.9274 0.9535 23.9851 24.6853 27.2705 25.3146 

230106 ............................................................................. 1.1151 0.9398 23.1962 24.1128 24.3980 23.9236 

230108 ............................................................................. 1.1539 0.8923 19.9842 22.4966 18.4063 20.1757 

230110 ............................................................................. 1.2559 0.8923 21.5523 22.7621 28.7704 24.4693 

230117 ............................................................................. 1.8428 1.0403 28.1220 29.6361 29.4775 29.0873 

230118 ............................................................................. 1.0609 0.8923 22.2208 21.4886 22.3636 22.0278 

230119 ............................................................................. 1.2750 1.0453 25.3562 29.2509 30.4910 28.0624 

230120 h ........................................................................... 1.1085 1.0885 22.7243 21.7894 24.1485 22.9095 

230121 ............................................................................. 1.2547 0.9786 22.3708 23.4394 24.5220 23.4095 

230124 ............................................................................. 1.3011 0.8923 22.0097 23.0508 * 22.5308 

230130 ............................................................................. 1.7348 0.9858 23.7854 26.9907 26.6076 25.8001 

230132 ............................................................................. 1.3708 1.0654 29.0292 29.9106 30.5074 29.8111 

230133 ............................................................................. 1.4219 0.8923 20.4801 21.2273 22.7380 21.5235 

230135 ............................................................................. 1.1067 1.0453 19.8290 23.9000 25.8406 23.1673 

230141 ............................................................................. 1.6290 1.0654 23.9885 30.4643 28.6326 27.6090 

230142 ............................................................................. 1.2390 1.0453 22.9036 25.6044 26.9433 25.2019 

230143 ............................................................................. 1.2372 0.8923 19.5446 19.5387 21.4083 20.1494 

230144 ............................................................................. *** 1.0885 23.6959 * * 23.6959 

230146 ............................................................................. 1.2340 1.0453 21.3539 24.3891 26.3432 24.1395 

230149 ............................................................................. 0.9394 0.8923 20.8933 21.4753 * 21.1778 

230151 ............................................................................. 1.3038 0.9858 23.8527 26.4669 27.1965 25.8699 

230153 ............................................................................. 1.0978 0.9786 22.8584 22.3404 22.8644 22.6896 

230155 ............................................................................. 1.0445 0.8923 18.0743 24.0404 * 20.6336 

230156 ............................................................................. 1.5897 1.0885 27.7164 29.4855 31.1909 29.5181 

230165 ............................................................................. 1.6979 1.0453 25.9534 27.3164 28.9636 27.4184 

230167 ............................................................................. 1.6158 0.9786 24.7935 26.6828 27.3362 26.2749 

230169 ............................................................................. *** 1.0453 24.9265 27.1172 31.8442 27.6798 

230171 ............................................................................. 1.0700 0.8923 19.9097 22.0635 * 20.9931 

230172 ............................................................................. 1.2263 1.0403 23.0023 24.0236 25.7402 24.2756 

230174 ............................................................................. 1.3089 0.9133 24.4671 26.2770 27.6920 26.1839 

230175 ............................................................................. *** * 22.5964 * * 22.5964 

230180 ............................................................................. 1.0957 0.8923 20.9832 22.5454 24.7358 22.8206 

230184 ............................................................................. 1.2135 0.9300 21.4031 21.9346 23.6707 22.3438 

230186 ............................................................................. *** * 21.6147 27.1126 26.2282 24.5338 

230188 ............................................................................. 0.9259 0.8923 18.8076 * * 18.8076 

230190 ............................................................................. 1.0114 1.0403 27.3430 28.7365 29.9604 28.6717 

230193 ............................................................................. 1.2672 0.9858 22.8916 24.3181 23.3565 23.5189 

230195 ............................................................................. 1.4253 1.0453 25.3285 27.1266 28.2892 26.9865 

230197 ............................................................................. 1.5717 1.0654 26.9840 28.3439 30.0367 28.4836 

230204 ............................................................................. 1.2871 1.0453 24.4095 25.9871 29.1466 26.3875 

230207 ............................................................................. 1.3574 0.9858 22.2848 22.2854 24.4641 22.9909 

230208 ............................................................................. 1.1926 0.9398 20.3171 20.9420 21.9651 21.0908 

230212 ............................................................................. 1.0168 1.0885 26.0656 27.3686 29.7980 27.6833 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23511 

TABLE 2.—HOSPITAL CASE-MIX INDEXES FOR DISCHARGES OCCURRING IN FEDERAL FISCAL YEAR 2004; HOSPITAL AVERAGE HOURLY WAGE FOR FEDERAL FISCAL YEARS 2004 (2000 WAGE DATA), 2005 (2001 WAGE DATA), AND 2006 

(2002 WAGE DATA) WAGE INDEXES AND 3-YEAR AVERAGE OF HOSPITAL AVERAGE HOURLY WAGES—Continued 

Provider number Case-mix 

index 

Wage index 

FY 2006 

Average 

hourly wage 

FY 2004 

Average 

hourly wage 

FY 2005 

Average 

hourly wage 

FY 2006 

Average 

hourly 

wage ** 

(3 years) 

230216 ............................................................................. 1.5428 0.9858 23.4262 26.1468 27.5230 25.7787 

230217 ............................................................................. 1.2812 0.9786 24.3650 26.7929 28.5002 26.7214 

230222 h ........................................................................... 1.3221 0.9474 24.6101 24.8925 26.3990 25.3118 

230223 ............................................................................. 1.2599 0.9858 28.5549 27.1503 29.2853 28.3304 

230227 ............................................................................. 1.5008 1.0453 27.7510 28.1105 29.6068 28.4994 

230230 ............................................................................. 1.4934 0.9786 23.9568 25.4471 27.9607 25.8281 

230235 ............................................................................. 1.0134 0.9090 19.9118 19.6046 21.8777 20.4653 

230236 ............................................................................. 1.4098 0.9398 25.7463 26.3988 28.4754 26.9289 

230239 ............................................................................. 1.2173 0.8923 19.8370 21.1643 22.1040 21.0930 

230241 ............................................................................. 1.1712 0.9858 24.2063 25.8671 27.4890 25.8668 

230244 ............................................................................. 1.3245 1.0453 23.9004 25.3817 26.4326 25.2154 

230254 ............................................................................. 1.3405 0.9858 24.2594 26.4431 28.1216 26.2901 

230257 ............................................................................. 1.0228 1.0453 24.8069 25.4086 27.8197 25.8794 

230259 ............................................................................. 1.2092 1.0885 24.8598 24.3067 26.8677 25.3750 

230264 ............................................................................. 2.1560 1.0453 17.4847 19.9992 19.2398 19.0176 

230269 ............................................................................. 1.3453 0.9858 25.3367 27.4732 28.8187 27.2692 

230270 ............................................................................. 1.2537 1.0453 22.8842 26.1113 27.8488 25.6802 

230273 ............................................................................. 1.4149 1.0453 25.8466 30.2209 29.9307 28.6762 

230275 ............................................................................. 0.4478 0.9474 29.4180 30.2244 23.1095 27.7059 

230276 ............................................................................. *** * 23.4928 * * 23.4928 

230279 ............................................................................. 0.5281 1.0654 21.2467 23.1636 24.7673 22.9663 

230283 ............................................................................. 0.8624 1.0453 25.0038 24.9272 26.2622 25.3910 

230288 ............................................................................. *** * 30.3422 * * 30.3422 

230290 ............................................................................. *** * * 29.4792 * 29.4792 

230291 ............................................................................. *** * * * 30.9655 30.9655 

230292 ............................................................................. *** 0.9474 * * 31.8943 31.8943 

240001 ............................................................................. 1.5054 1.1055 28.2239 29.9123 31.5753 29.9731 

240002 ............................................................................. 1.8195 1.0224 24.7674 26.9608 28.9860 26.9851 

240004 ............................................................................. 1.5291 1.1055 26.8197 27.8796 30.8072 28.5006 

240006 ............................................................................. 1.0536 1.1128 29.5789 30.2330 30.1950 30.0237 

240007 ............................................................................. 1.1446 0.9183 21.4367 23.7588 24.7344 23.3456 

240010 ............................................................................. 2.0425 1.1128 29.0955 30.4139 31.3733 30.3196 

240011 ............................................................................. 1.0425 0.9183 24.0364 22.9561 * 23.3835 

240013 ............................................................................. 1.2687 1.0905 27.3855 28.7202 28.3860 28.1704 

240014 ............................................................................. 1.0309 0.9183 26.5144 28.3788 29.8623 28.2985 

240016 ............................................................................. 1.2584 0.9183 25.2629 24.9211 26.7814 25.7376 

240017 ............................................................................. 1.2467 0.9183 21.6243 23.3314 24.4417 23.1535 

240018 ............................................................................. 1.2293 1.0905 27.3634 27.9218 25.6484 26.6329 

240019 ............................................................................. 1.1105 1.0224 25.1331 27.5441 28.6723 27.1439 

240020 ............................................................................. 1.0806 1.1055 24.7516 28.1568 31.2443 28.0203 

240021 ............................................................................. 0.8545 0.9183 23.9568 23.7096 27.1235 24.8433 

240022 ............................................................................. 1.1064 0.9183 23.4702 23.7368 25.2066 24.1392 

240025 ............................................................................. 1.0776 0.9183 21.2597 27.8656 * 24.3444 

240027 ............................................................................. 0.9440 0.9183 18.3340 20.2531 18.2481 18.8765 

240029 ............................................................................. 1.0819 0.9183 21.2342 24.3017 25.3568 23.3870 

240030 ............................................................................. 1.3564 0.9785 22.0200 23.3753 24.7154 23.4178 

240031 ............................................................................. 0.9494 1.0905 23.4389 26.7242 26.7778 25.6303 

240036 ............................................................................. 1.6880 1.0905 23.4857 27.0821 28.0812 26.3323 

240037 ............................................................................. 1.0359 0.9183 21.8392 24.3986 * 23.1115 

240038 ............................................................................. 1.5291 1.1055 28.9676 29.8465 31.0779 30.0073 

240040 ............................................................................. 1.0854 1.0224 21.3870 26.3177 27.4895 24.8843 

240043 ............................................................................. 1.1301 0.9183 19.5532 20.7155 21.8685 20.7481 

240044 ............................................................................. 1.1203 0.9183 22.7482 24.3009 22.5843 23.1864 

240045 ............................................................................. 1.1212 1.0224 25.9223 26.1743 27.5013 26.5626 

240047 ............................................................................. 1.5649 1.0224 29.6184 29.1211 28.8288 29.1562 

240050 ............................................................................. 1.0196 1.1055 24.7589 26.6687 26.4854 26.0710 

240052 ............................................................................. 1.1991 0.9183 23.5898 24.9870 26.4256 25.0236 

240053 ............................................................................. 1.4186 1.1055 26.7122 28.4733 29.5315 28.3118 

240056 ............................................................................. 1.2420 1.1055 28.5169 30.8619 31.6623 30.4153 

240057 ............................................................................. 1.8473 1.1055 27.7600 29.4870 30.6258 29.3431 

240059 ............................................................................. 1.0902 1.1055 27.0517 28.6340 29.7916 28.5358 

240061 ............................................................................. 1.7485 1.1128 28.7372 30.0031 30.6383 29.8381 

240063 ............................................................................. 1.5546 1.1055 26.7960 29.9603 32.3487 29.6692 

240064 ............................................................................. 1.2568 1.0224 24.9928 26.6996 29.9662 27.5790 

240066 ............................................................................. 1.3913 1.1055 27.4066 30.2716 33.4532 30.4657 

240069 ............................................................................. 1.1378 1.1128 25.6943 27.4990 28.9496 27.4534 

240071 ............................................................................. 1.1486 1.1128 24.8036 26.4780 28.0585 26.4808 

23512 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

TABLE 2.—HOSPITAL CASE-MIX INDEXES FOR DISCHARGES OCCURRING IN FEDERAL FISCAL YEAR 2004; HOSPITAL AVERAGE HOURLY WAGE FOR FEDERAL FISCAL YEARS 2004 (2000 WAGE DATA), 2005 (2001 WAGE DATA), AND 2006 

(2002 WAGE DATA) WAGE INDEXES AND 3-YEAR AVERAGE OF HOSPITAL AVERAGE HOURLY WAGES—Continued 

Provider number Case-mix 

index 

Wage index 

FY 2006 

Average 

hourly wage 

FY 2004 

Average 

hourly wage 

FY 2005 

Average 

hourly wage 

FY 2006 

Average 

hourly 

wage ** 

(3 years) 

240075 ............................................................................. 1.1988 0.9785 24.4084 26.6607 26.1956 25.7681 

240076 ............................................................................. 1.1046 1.1055 26.7112 28.4519 29.8562 28.4067 

240077 ............................................................................. *** 0.9183 18.9735 * * 18.9735 

240079 ............................................................................. 0.9411 1.1521 20.6644 20.9220 * 20.8010 

240080 ............................................................................. 1.6892 1.1055 27.8807 29.6274 31.6484 29.7472 

240083 ............................................................................. 1.2481 0.9183 24.4352 25.0214 26.6582 25.4096 

240084 ............................................................................. 1.1252 1.0224 23.9942 24.7856 26.8142 25.2047 

240087 ............................................................................. 1.0235 0.9183 20.1002 24.8479 24.9419 23.3753 

240088 ............................................................................. 1.2698 0.9785 25.5587 27.6323 28.0825 27.1245 

240089 ............................................................................. *** 0.9183 23.4028 * * 23.4028 

240094 ............................................................................. 1.0759 1.1055 24.4166 27.3974 28.3973 26.8076 

240097 ............................................................................. *** * 34.2810 * * 34.2810 

240101 ............................................................................. 1.1412 0.9183 24.3455 26.6078 25.5355 25.5132 

240103 ............................................................................. 1.0495 0.9183 20.2324 22.5416 22.7078 21.8542 

240104 ............................................................................. 1.1424 1.1055 27.4946 30.1392 31.4306 29.9577 

240106 ............................................................................. 1.4870 1.1055 25.5890 27.5171 29.3455 27.5527 

240107 ............................................................................. 0.9093 0.9183 24.5583 25.5199 26.1078 25.4514 

240109 ............................................................................. 0.9472 0.9183 14.5892 15.2076 16.5051 15.4279 

240115 ............................................................................. 1.6156 1.1055 27.0312 29.0261 31.3869 29.1786 

240117 ............................................................................. 1.1377 0.9183 20.1436 22.0463 23.8076 22.0056 

240121 ............................................................................. 0.9139 1.0224 24.5455 * * 24.5455 

240123 ............................................................................. 1.0528 0.9183 20.0721 20.5755 21.7500 20.8397 

240124 ............................................................................. 0.9638 0.9183 23.5139 23.9297 * 23.7277 

240127 ............................................................................. *** * 19.3857 24.4824 * 21.5460 

240128 ............................................................................. 1.0138 0.9183 20.1960 21.2638 21.5791 21.0226 

240132 ............................................................................. 1.2654 1.1055 26.7063 29.5310 31.7139 29.3306 

240133 ............................................................................. 1.1406 0.9183 23.6068 26.1836 27.7658 25.8348 

240135 ............................................................................. *** * 17.8573 16.1837 * 16.9824 

240137 ............................................................................. 1.1919 0.9183 23.1752 23.8666 * 23.5315 

240139 ............................................................................. 1.0798 0.9183 22.4473 23.7898 * 23.1612 

240141 ............................................................................. 1.0222 1.1055 25.1597 26.7173 26.4016 26.1666 

240143 ............................................................................. 0.8521 0.9183 18.9442 21.1180 21.7416 20.6376 

240145 ............................................................................. *** 0.9183 22.6063 * * 22.6063 

240154 ............................................................................. 1.0199 0.9183 21.3809 23.9643 * 22.6453 

240162 ............................................................................. 1.1601 0.9183 20.4807 22.3136 22.2721 21.7043 

240166 ............................................................................. 1.1135 0.9183 21.5002 23.4265 25.7509 23.5628 

240179 ............................................................................. 0.8255 0.9183 19.8249 20.8449 * 20.3419 

240187 ............................................................................. 1.2137 1.0905 24.8879 26.5129 27.8811 26.4667 

240196 ............................................................................. 0.8421 1.1055 27.2901 28.9380 30.7719 29.0287 

240207 ............................................................................. 1.2007 1.1055 27.4330 29.2395 31.7414 29.5819 

240210 ............................................................................. 1.2500 1.1055 26.6545 29.7227 32.1564 29.5372 

240211 ............................................................................. 0.9023 1.0905 32.8801 44.4214 18.8503 27.6876 

240213 ............................................................................. 1.3095 1.1055 27.5104 31.3974 32.7532 30.8794 

250001 ............................................................................. 1.8170 0.8313 20.9338 21.9176 22.7827 21.9287 

250002 ............................................................................. 0.8813 0.7685 21.6643 20.1310 23.3845 21.6434 

250004 ............................................................................. 1.8313 0.9108 20.9295 20.6828 24.1065 21.8737 

250006 ............................................................................. 1.0428 0.9108 20.3061 21.4038 24.0191 21.9290 

250007 ............................................................................. 1.2343 0.8922 21.2226 23.6933 25.8710 23.5817 

250009 ............................................................................. 1.2453 0.8799 19.7610 20.4329 22.2323 20.8522 

250010 ............................................................................. 0.9833 0.7685 17.6204 19.4130 19.4403 18.8097 

250012 ............................................................................. 0.9469 0.9346 15.6117 20.0493 20.2921 18.4571 

250015 ............................................................................. 1.0268 0.7685 19.3794 20.6931 20.7555 20.2702 

250017 ............................................................................. 1.0970 0.7685 19.0436 18.1013 21.3950 19.5260 

250018 ............................................................................. 0.9215 0.7685 16.8783 17.0689 16.6294 16.8678 

250019 ............................................................................. 1.5528 0.8922 22.9085 22.8358 23.9741 23.2493 

250020 ............................................................................. 0.9918 0.7685 19.1877 19.3390 21.4019 19.9847 

250021 ............................................................................. *** * 15.8485 15.1242 20.3559 16.0142 

250023 ............................................................................. 0.8443 0.8612 14.7355 16.1820 16.2418 15.7024 

250025 ............................................................................. 1.0405 0.7685 21.2651 20.6892 20.5258 20.8816 

250027 ............................................................................. 0.9794 0.7685 17.5937 17.3313 17.3481 17.4314 

250030 ............................................................................. *** 0.7685 27.2140 * * 27.2140 

250034 ............................................................................. 1.5307 0.9108 20.3681 20.6752 24.3189 21.8100 

250035 ............................................................................. 0.8545 0.7685 17.1071 14.6149 17.2045 16.2933 

250036 ............................................................................. 1.0038 0.8164 17.0469 17.8313 19.1975 18.0476 

250037 ............................................................................. 0.8638 0.7685 16.6347 17.4463 17.4012 17.1789 

250038 ............................................................................. 0.9832 0.8313 16.8610 18.0209 18.9050 17.9032 

250039 ............................................................................. 0.9125 0.8313 16.8729 15.2939 17.3155 16.4505 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23513 

TABLE 2.—HOSPITAL CASE-MIX INDEXES FOR DISCHARGES OCCURRING IN FEDERAL FISCAL YEAR 2004; HOSPITAL AVERAGE HOURLY WAGE FOR FEDERAL FISCAL YEARS 2004 (2000 WAGE DATA), 2005 (2001 WAGE DATA), AND 2006 

(2002 WAGE DATA) WAGE INDEXES AND 3-YEAR AVERAGE OF HOSPITAL AVERAGE HOURLY WAGES—Continued 

Provider number Case-mix 

index 

Wage index 

FY 2006 

Average 

hourly wage 

FY 2004 

Average 

hourly wage 

FY 2005 

Average 

hourly wage 

FY 2006 

Average 

hourly 

wage ** 

(3 years) 

250040 ............................................................................. 1.4718 0.8612 20.8178 21.3451 23.2285 21.8161 

250042 ............................................................................. 1.2038 0.9108 19.4367 21.4117 23.4135 21.3957 

250043 ............................................................................. 1.0429 0.7685 17.7554 18.3322 19.8098 18.6971 

250044 ............................................................................. 1.0199 0.7685 20.3711 21.1198 23.3862 21.6199 

250045 ............................................................................. 1.0872 0.8922 25.3236 25.0863 26.3831 25.6144 

250048 ............................................................................. 1.5843 0.8313 19.3635 21.6547 22.9765 21.3756 

250049 ............................................................................. 0.8410 0.7685 13.4396 17.8154 17.7005 16.2411 

250050 ............................................................................. 1.1957 0.7685 16.6723 18.3170 19.1467 18.0183 

250051 ............................................................................. 0.8358 0.7685 10.5027 10.6908 10.6095 10.6008 

250057 ............................................................................. 1.1292 0.7685 19.0571 19.6789 20.1900 19.6573 

250058 ............................................................................. 1.2515 0.7685 16.5565 17.5160 18.1704 17.4280 

250059 ............................................................................. 0.9814 0.7685 19.0733 17.7270 19.2977 18.6884 

250060 ............................................................................. 0.7926 0.7685 14.0155 20.8115 16.8247 17.2475 

250061 ............................................................................. 0.8412 0.7685 11.4573 15.2515 12.8174 12.9127 

250065 ............................................................................. 0.8170 0.8313 16.2010 16.1984 * 16.1997 

250066 ............................................................................. 0.7831 0.7685 16.1044 * * 16.1044 

250068 ............................................................................. 0.7547 0.7685 16.3759 16.9585 * 16.6506 

250069 ............................................................................. 1.4860 0.8614 21.2224 21.6617 22.8162 21.9460 

250071 ............................................................................. 0.8305 0.7685 13.7056 17.7149 * 15.4400 

250072 ............................................................................. 1.4976 0.8313 20.7827 22.9316 24.6587 22.7773 

250077 ............................................................................. 0.9403 0.7685 14.0318 14.2271 14.7632 14.3259 

250078 2 ........................................................................... 1.5963 0.7685 17.5186 18.6563 20.9354 19.1036 

250079 ............................................................................. 0.8383 0.8182 21.3506 27.2549 38.0031 29.5848 

250081 ............................................................................. 1.2295 0.8182 20.4513 21.3830 24.7031 21.9463 

250082 ............................................................................. 1.2744 0.8099 19.5962 20.5212 19.6966 19.9404 

250083 ............................................................................. 0.9072 0.7685 19.5217 19.9484 * 19.7505 

250084 ............................................................................. 1.1575 0.7685 22.4632 21.8001 18.5775 20.7280 

250085 ............................................................................. 0.9532 0.7685 18.0473 18.7367 19.7007 18.8283 

250089 ............................................................................. 1.0502 0.7685 16.0203 * * 16.0203 

250094 ............................................................................. 1.5886 0.8612 19.9619 22.3312 22.7312 21.7001 

250095 ............................................................................. 0.9965 0.7685 18.6616 19.9553 21.3511 19.9748 

250096 ............................................................................. 1.0784 0.8313 20.7246 22.7458 22.6298 22.0767 

250097 ............................................................................. 1.3963 0.8470 18.8399 19.4534 20.1687 19.4858 

250098 ............................................................................. *** 0.7685 17.9561 * * 17.9561 

250100 ............................................................................. 1.4464 0.8614 18.8877 22.0328 24.2209 21.7570 

250101 ............................................................................. *** * * 21.2234 * 9.7147 

250102 ............................................................................. 1.5446 0.8313 21.3213 22.5518 24.2868 22.7655 

250104 ............................................................................. 1.4244 0.8182 20.5035 21.4431 22.6591 21.5782 

250105 ............................................................................. 0.8995 0.7685 17.0136 17.9468 18.1196 17.6992 

250107 ............................................................................. 0.9071 0.7685 16.7104 16.5369 17.8999 17.0742 

250112 ............................................................................. 0.9521 0.7685 16.8696 19.6172 21.2824 19.4217 

250117 ............................................................................. 1.0298 0.8612 18.8863 19.9774 23.3673 20.6608 

250119 ............................................................................. *** 0.7685 17.1373 * * 17.1373 

250122 ............................................................................. 1.0617 0.7685 19.7966 23.7230 24.5854 22.7156 

250123 ............................................................................. 1.2675 0.8922 22.2184 22.0486 24.5115 22.9495 

250124 ............................................................................. 0.8390 0.8313 15.6866 15.4343 17.2181 16.1302 

250125 ............................................................................. 1.2819 0.8922 25.3415 26.8379 27.7077 26.6997 

250126 ............................................................................. 0.9380 0.9346 20.1118 20.4085 21.7111 20.7174 

250128 ............................................................................. 0.8826 0.7685 15.8352 15.9344 17.6269 16.4363 

250131 ............................................................................. 0.8879 0.7685 11.5396 * * 11.5396 

250136 ............................................................................. 0.9767 0.8313 21.9977 22.5832 23.0637 22.5479 

250138 ............................................................................. 1.2637 0.8313 21.2490 22.7902 23.8861 22.6997 

250141 ............................................................................. 1.5358 0.9346 22.5187 24.5772 27.6158 25.2301 

250146 ............................................................................. 0.8784 0.7685 16.9341 17.2328 18.6486 17.5743 

250149 ............................................................................. 0.8979 0.7685 16.4228 15.0367 15.0641 15.5315 

250151 ............................................................................. 0.7214 0.7685 20.4581 21.8697 17.2205 18.4362 

250152 ............................................................................. 1.6630 0.8313 * * 25.7837 25.7837 

250153 ............................................................................. *** 0.8313 * * 29.0461 29.0461 

260001 ............................................................................. 1.6129 0.8594 22.6646 25.3084 25.9250 24.6413 

260002 ............................................................................. *** 0.8953 24.6812 27.2329 26.4879 26.0819 

260003 ............................................................................. 1.0250 0.7927 16.5931 17.6339 * 17.1135 

260004 ............................................................................. 0.9578 0.7927 16.4423 16.7742 16.9421 16.7356 

260005 ............................................................................. 1.4759 0.8953 25.5927 24.6142 26.5773 25.6220 

260006 ............................................................................. 1.4271 0.7927 24.1078 26.4948 26.7587 25.8174 

260008 ............................................................................. *** * 21.6256 17.6040 18.9522 19.2926 

260009 ............................................................................. 1.1793 0.9454 20.1679 21.2729 22.1816 21.2122 

260011 ............................................................................. 1.3859 0.8346 21.1625 21.4409 22.7061 21.7937 

23514 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

TABLE 2.—HOSPITAL CASE-MIX INDEXES FOR DISCHARGES OCCURRING IN FEDERAL FISCAL YEAR 2004; HOSPITAL AVERAGE HOURLY WAGE FOR FEDERAL FISCAL YEARS 2004 (2000 WAGE DATA), 2005 (2001 WAGE DATA), AND 2006 

(2002 WAGE DATA) WAGE INDEXES AND 3-YEAR AVERAGE OF HOSPITAL AVERAGE HOURLY WAGES—Continued 

Provider number Case-mix 

index 

Wage index 

FY 2006 

Average 

hourly wage 

FY 2004 

Average 

hourly wage 

FY 2005 

Average 

hourly wage 

FY 2006 

Average 

hourly 

wage ** 

(3 years) 

260012 ............................................................................. 1.0499 0.7927 17.7854 19.3389 20.3061 19.2632 

260013 ............................................................................. 1.0044 0.8594 18.4857 19.2065 20.5007 19.3903 

260015 ............................................................................. 1.0786 0.7927 21.7581 22.4450 22.5409 22.2644 

260017 ............................................................................. 1.3014 0.8953 20.7837 21.1359 22.7022 21.5787 

260018 ............................................................................. 1.0599 0.7927 14.3278 14.8425 17.0434 15.4340 

260020 ............................................................................. 1.7361 0.8953 22.4709 25.7898 26.0407 24.8648 

260021 ............................................................................. 1.3546 0.8953 27.2478 27.8332 27.6330 27.5756 

260022 ............................................................................. 1.2242 0.8563 20.5417 21.7707 22.8085 21.6784 

260023 ............................................................................. 1.2675 0.8953 19.6324 21.2519 21.2077 20.7002 

260024 ............................................................................. 1.1370 0.7927 16.9968 17.5351 18.4829 17.6819 

260025 ............................................................................. 1.2646 0.8953 19.3535 20.0901 22.4645 20.6596 

260027 ............................................................................. 1.5961 0.9454 22.9973 24.7605 25.3348 24.3810 

260029 ............................................................................. 1.0866 0.9454 22.0390 22.2892 23.1185 22.4857 

260031 ............................................................................. *** * 24.3626 24.2877 * 24.3260 

260032 ............................................................................. 1.7985 0.8953 21.8830 23.1125 23.8459 22.9657 

260034 ............................................................................. 0.9517 0.9454 21.6108 23.3034 24.1143 23.0518 

260035 ............................................................................. 0.9459 0.7927 15.0468 16.8502 17.8741 16.5641 

260036 ............................................................................. 0.9500 0.9454 19.4559 20.1324 22.1912 20.4830 

260040 ............................................................................. 1.6194 0.8251 20.0422 21.9452 23.3566 21.8297 

260044 ............................................................................. 0.9352 0.7927 18.2413 20.0686 22.4498 20.3210 

260047 ............................................................................. 1.5009 0.8346 22.4585 22.6169 24.4185 23.1892 

260048 ............................................................................. 1.2518 0.9454 26.6363 25.8089 24.3906 25.5119 

260050 ............................................................................. 1.1354 0.7927 20.8510 20.6364 23.6849 21.9007 

260052 ............................................................................. 1.3148 0.8953 21.1297 22.5809 24.5165 22.8077 

260053 ............................................................................. 1.0393 0.8594 18.9606 20.0051 21.6607 20.2038 

260057 ............................................................................. 1.0346 0.9454 15.8404 16.4875 19.3335 17.1879 

260059 ............................................................................. 1.1931 0.7927 17.2807 18.6379 19.7243 18.6135 

260061 ............................................................................. 1.0883 0.7927 18.7280 19.6674 21.5264 19.9180 

260062 ............................................................................. 1.1811 0.9454 25.2958 26.0439 26.4539 25.9705 

260063 ............................................................................. 0.9686 0.9454 21.1284 22.0826 * 21.6180 

260064 ............................................................................. 1.3672 0.8346 17.5188 19.1587 19.0543 18.5908 

260065 ............................................................................. 1.7230 0.8251 22.0058 23.6969 23.0015 22.9155 

260067 ............................................................................. 0.8937 0.7927 14.9792 16.5364 17.6256 16.4270 

260068 ............................................................................. 1.7577 0.8346 22.0951 23.9340 24.9504 23.7077 

260070 ............................................................................. 0.9581 0.7927 11.2251 14.3881 18.4779 14.0836 

260073 ............................................................................. 1.0189 0.7927 17.8185 19.2744 21.6214 19.6354 

260074 ............................................................................. 1.1674 0.8346 18.7639 23.9301 24.8654 22.4254 

260077 ............................................................................. 1.6385 0.8953 21.9947 23.5466 25.5782 23.7347 

260078 ............................................................................. 1.1970 0.7927 16.9217 18.4017 19.0802 18.1811 

260080 ............................................................................. 0.8933 0.7927 13.6815 11.2817 14.7774 13.2210 

260081 ............................................................................. 1.4823 0.8953 22.6627 23.7447 26.3969 24.2793 

260085 ............................................................................. 1.5874 0.9454 22.7394 24.6046 25.6302 24.3659 

260086 ............................................................................. 0.8704 0.7927 17.2048 17.1202 19.1702 17.8711 

260091 ............................................................................. 1.5058 0.8953 23.9975 26.1149 27.2407 25.8446 

260094 ............................................................................. 1.6399 0.8251 20.1043 20.6805 23.2544 21.4540 

260095 ............................................................................. 1.3081 0.9454 22.8156 23.8671 25.5668 24.0702 

260096 ............................................................................. 1.4315 0.9454 23.5009 25.9932 27.5592 25.8492 

260097 ............................................................................. 1.1515 0.7927 19.6203 21.5077 21.3957 20.9049 

260102 ............................................................................. 0.8325 0.9454 24.1041 22.9283 24.2368 23.7509 

260103 ............................................................................. *** * 21.6192 23.3175 * 22.4894 

260104 ............................................................................. 1.4636 0.8953 22.4769 24.0038 26.2867 24.3941 

260105 ............................................................................. 1.7197 0.8953 24.6572 28.4652 28.8849 27.3498 

260107 ............................................................................. 1.3072 0.9454 23.1564 24.2001 26.7782 24.6444 

260108 ............................................................................. 1.8305 0.8953 22.7975 24.0936 25.0171 23.9907 

260110 ............................................................................. 1.6192 0.8953 22.0026 22.2730 3.7978 22.7167

260113 ............................................................................. 1.0827 0.8285 16.3440 19.2467 20.9644 18.7740 

260115 ............................................................................. 1.1542 0.8953 20.4880 21.7450 21.9859 21.4408 

260116 ............................................................................. 1.1207 0.8285 16.9807 17.2698 18.5076 17.6168 

260119 ............................................................................. 1.3355 0.7927 18.7959 22.1588 24.9937 22.8442 

260120 ............................................................................. *** * 18.7651 * * 18.7651 

260123 ............................................................................. 0.9970 0.7927 17.7996 16.1169 * 17.0002 

260127 ............................................................................. 0.9648 0.7927 19.7946 22.5328 21.8534 21.3553 

260134 ............................................................................. 1.1483 0.8953 18.4511 18.1531 * 18.2845 

260137 ............................................................................. 1.6384 0.8594 20.7638 21.3426 22.7431 21.6630 

260138 ............................................................................. 1.9066 0.9454 25.6579 27.8229 28.5610 27.3740 

260141 ............................................................................. 1.9089 0.8346 21.0771 21.1511 22.4886 21.5378 

260142 ............................................................................. 1.0487 0.7927 18.6412 19.6582 20.3993 19.6104 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23515 

TABLE 2.—HOSPITAL CASE-MIX INDEXES FOR DISCHARGES OCCURRING IN FEDERAL FISCAL YEAR 2004; HOSPITAL AVERAGE HOURLY WAGE FOR FEDERAL FISCAL YEARS 2004 (2000 WAGE DATA), 2005 (2001 WAGE DATA), AND 2006 

(2002 WAGE DATA) WAGE INDEXES AND 3-YEAR AVERAGE OF HOSPITAL AVERAGE HOURLY WAGES—Continued 

Provider number Case-mix 

index 

Wage index 

FY 2006 

Average 

hourly wage 

FY 2004 

Average 

hourly wage 

FY 2005 

Average 

hourly wage 

FY 2006 

Average 

hourly 

wage ** 

(3 years) 

260147 ............................................................................. 0.9384 0.7927 16.1171 17.2291 18.5153 17.2858 

260159 ............................................................................. *** 0.8953 23.1093 26.8924 23.7427 24.4817 

260160 ............................................................................. 1.0773 0.7927 18.8723 19.4997 21.0544 19.7923 

260162 ............................................................................. 1.3864 0.8953 22.5705 24.1246 25.1423 23.9984 

260163 ............................................................................. 1.1422 0.7927 18.1310 19.2885 20.1949 19.2038 

260164 ............................................................................. 1.0696 0.7927 16.9403 19.5539 19.7068 18.6878 

260166 ............................................................................. 1.1854 0.9454 22.8409 25.5151 27.0237 25.1725 

260172 ............................................................................. 0.9089 0.7927 17.1504 18.1438 * 17.6539 

260175 ............................................................................. 1.1001 0.7927 19.7939 21.1257 22.6171 21.1462 

260176 ............................................................................. 1.5811 0.8953 25.7802 29.2184 27.4244 27.5317 

260177 ............................................................................. 1.2174 0.9454 24.0550 25.0724 26.1178 25.1274 

260178 ............................................................................. 1.8186 0.8346 21.7704 21.4781 22.2251 21.8190 

260179 ............................................................................. 1.5692 0.8953 23.2824 24.8541 26.1419 24.7933 

260180 ............................................................................. 1.5399 0.8953 21.8585 21.9679 26.7461 23.4659 

260183 ............................................................................. 1.6506 0.8953 24.2330 23.3924 26.0418 24.6030 

260186 ............................................................................. 1.6276 0.8346 21.6620 23.4317 25.3148 23.5713 

260190 ............................................................................. 1.1384 0.9454 24.5014 25.1653 26.4505 25.4095 

260191 ............................................................................. 1.3158 0.8953 21.1331 22.4369 23.3856 22.3648 

260193 ............................................................................. 1.2140 0.9454 22.9556 24.4705 26.2979 24.7042 

260195 ............................................................................. 1.2803 0.8251 20.0889 20.1327 22.3958 20.9711 

260198 ............................................................................. 1.1855 0.8953 25.3390 27.6116 27.5996 26.8633 

260200 ............................................................................. 1.2198 0.8953 22.3913 25.1134 24.8624 24.2536 

260207 ............................................................................. 1.0594 0.8251 18.5247 19.2467 19.7294 19.2332 

260208 ............................................................................. *** * 28.3158 * * 28.3158 

260210 ............................................................................. 1.2045 0.8953 * * 25.3782 25.3782 

260211 ............................................................................. 1.5796 0.9454 * * 33.9109 33.9109 

270002 2 ........................................................................... 1.2881 0.8822 19.7588 20.7620 22.7322 21.1317 

270003 ............................................................................. 1.2770 0.9074 23.0396 24.2823 26.4843 24.5714 

270004 ............................................................................. 1.6910 0.8855 21.5577 22.9081 23.5454 22.7035 

270009 ............................................................................. 1.2674 0.8822 21.5655 * * 21.5655 

270012 2 ........................................................................... 1.4482 0.9074 21.7634 23.1697 25.2873 23.4084 

270014 ............................................................................. 1.8188 0.9535 20.3456 25.0650 26.2025 23.6425 

270017 ............................................................................. 1.2612 0.9535 23.2320 24.6186 27.5483 25.1665 

270021 ............................................................................. 1.0085 0.8822 21.1624 21.6758 21.7056 21.5330 

270023 ............................................................................. 1.5160 0.9535 23.7486 25.5525 26.7576 25.3555 

270032 ............................................................................. 1.0500 0.8822 20.1801 18.2377 19.6212 19.3552 

270036 ............................................................................. 0.7848 0.8822 18.8785 21.8255 20.4242 20.3944 

270040 ............................................................................. 1.1798 0.8822 20.7240 * * 20.7240 

270050 ............................................................................. 1.0303 0.8822 21.0901 22.4195 * 21.7451 

270051 ............................................................................. 1.5685 0.9535 22.2580 26.4457 26.6619 25.1119 

270057 ............................................................................. 1.2222 0.8822 21.9997 22.6251 24.2980 23.0119 

270060 ............................................................................. 0.8776 0.8822 * 16.6592 * 16.6592 

270079 ............................................................................. 0.8473 0.8822 * 21.6382 * 21.6382 

270081 ............................................................................. 1.0052 0.8822 15.6833 17.3174 17.4862 16.8348 

270082 ............................................................................. 1.0621 0.8822 21.0150 19.6173 * 20.3610 

270084 2 ........................................................................... 0.9843 0.8822 19.6104 22.2340 * 21.0235 

280003 ............................................................................. 1.8332 1.0197 26.0937 27.2844 29.3921 27.8614 

280005 ............................................................................. *** * 23.9753 * * 23.9753 

280010 ............................................................................. *** * 23.8325 22.6516 * 23.2571 

280013 ............................................................................. 1.8041 0.9555 23.4920 24.5214 26.1908 24.7334 

280020 ............................................................................. 1.7943 1.0197 23.4577 25.7522 26.5068 25.3300 

280021 ............................................................................. 1.1390 0.8666 21.5215 22.2864 22.0489 21.9595 

280023 ............................................................................. 1.4073 0.9666 19.6265 22.7207 22.3230 21.6126 

280030 ............................................................................. 1.9343 0.9555 29.2221 32.5601 30.7481 30.8807 

280032 ............................................................................. 1.3356 0.9666 21.5150 22.6510 23.6462 22.6240 

280040 ............................................................................. 1.6685 0.9555 23.6597 25.2965 26.9827 25.3499 

280047 ............................................................................. 0.7767 0.9555 19.5815 * * 19.5815 

280057 ............................................................................. 0.8190 0.9666 22.5481 23.6793 20.4830 22.0597 

280060 ............................................................................. 1.6115 0.9555 23.1128 25.2288 26.2139 24.9273 

280061 ............................................................................. 1.3565 0.9207 21.2901 23.9110 24.9482 23.4090 

280065 ............................................................................. 1.2692 0.9597 23.8128 27.9937 26.0135 25.9591 

280077 ............................................................................. 1.3308 0.9555 22.7244 24.0516 25.5624 24.1150 

280081 ............................................................................. 1.6019 0.9555 24.3199 25.1973 26.0541 25.2026 

280085 ............................................................................. *** * 21.8473 * * 21.8473 

280108 ............................................................................. 1.0415 0.8666 20.9016 22.5584 23.2502 22.2006 

280111 ............................................................................. 1.2083 0.8666 20.7398 22.1424 23.4770 22.1827 

280117 ............................................................................. 1.0762 0.8666 20.5464 22.0611 24.1521 22.2744 

23516 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

TABLE 2.—HOSPITAL CASE-MIX INDEXES FOR DISCHARGES OCCURRING IN FEDERAL FISCAL YEAR 2004; HOSPITAL AVERAGE HOURLY WAGE FOR FEDERAL FISCAL YEARS 2004 (2000 WAGE DATA), 2005 (2001 WAGE DATA), AND 2006 

(2002 WAGE DATA) WAGE INDEXES AND 3-YEAR AVERAGE OF HOSPITAL AVERAGE HOURLY WAGES—Continued 

Provider number Case-mix 

index 

Wage index 

FY 2006 

Average 

hourly wage 

FY 2004 

Average 

hourly wage 

FY 2005 

Average 

hourly wage 

FY 2006 

Average 

hourly 

wage ** 

(3 years) 

280118 ............................................................................. 0.9146 0.8666 19.3466 * * 19.3466 

280125 ............................................................................. 1.5050 0.8666 20.0643 21.8385 21.7658 21.2295 

280126 ............................................................................. *** * 33.8918 * * 33.8918 

290002 ............................................................................. 0.8621 0.9786 16.8363 16.8433 18.3469 17.3909 

290003 ............................................................................. 1.7448 1.1416 27.4732 27.1099 28.1625 27.5886 

290005 ............................................................................. 1.3375 1.1416 24.6877 27.1531 27.6697 26.5417 

290006 ............................................................................. 1.2159 1.0805 24.2211 26.3617 27.9502 26.1547 

290007 ............................................................................. 1.5966 1.1416 35.1020 35.4193 37.5559 36.0546 

290008 ............................................................................. 1.1726 1.1249 27.0115 26.4086 27.9714 27.1141 

290009 ............................................................................. 1.8521 1.0984 26.9020 27.6011 29.8019 28.1837 

290010 ............................................................................. 1.0895 1.1416 25.4598 23.8733 23.9654 24.4204 

290012 ............................................................................. 1.3288 1.1416 25.8036 27.2675 31.0843 28.0502 

290016 ............................................................................. 1.1453 0.9079 22.5111 25.1726 26.1925 24.6281 

290019 ............................................................................. 1.3967 1.0805 25.1684 27.2484 28.6158 27.0192 

290020 h ........................................................................... 0.9611 1.1416 24.2373 21.3094 21.6993 22.1469 

290021 ............................................................................. 1.7247 1.1416 26.2510 28.3837 33.2116 29.2014 

290022 ............................................................................. 1.5056 1.1416 27.5364 29.8144 29.4422 28.9634 

290027 ............................................................................. 0.9165 0.9079 13.5031 17.8850 15.1448 15.3083 

290032 ............................................................................. 1.3609 1.0984 27.5425 29.4164 31.7105 29.6070 

290039 ............................................................................. 1.5069 1.1416 28.7599 29.6801 31.2941 30.0435 

290041 ............................................................................. 1.3172 1.1416 28.6294 30.1346 33.9878 31.0661 

290045 ............................................................................. 1.5063 1.1416 26.5644 26.9319 30.9612 28.4883 

300001 ............................................................................. 1.5520 1.0668 27.1312 29.4130 27.5032 28.0073 

300003 ............................................................................. 2.0702 1.0668 26.7859 27.8059 33.3560 29.3633 

300005 ............................................................................. 1.4218 1.0668 22.8163 25.1869 25.5583 24.5574 

300006 ............................................................................. 1.1092 1.0668 22.0187 20.6787 23.3200 21.9532 

300007 ............................................................................. 1.2560 1.0903 23.6919 25.3125 26.8347 25.3232 

300010 ............................................................................. 1.2942 1.0668 24.6295 26.9346 27.5028 26.4641 

300011 ............................................................................. 1.3026 1.0903 25.0979 27.3325 28.4044 26.9920 

300012 ............................................................................. 1.3884 1.0903 26.3914 28.4234 30.5198 28.4955 

300013 ............................................................................. 1.0657 1.0668 21.3397 23.1529 * 22.1888 

300014 ............................................................................. 1.2155 1.0668 23.7144 25.5059 27.5151 25.6846 

300015 ............................................................................. 1.0860 1.0668 24.4869 24.0620 * 24.2732 

300016 ............................................................................. *** 1.0668 18.9756 24.5498 * 21.6922 

300017 ............................................................................. 1.2121 1.0668 26.1104 28.3959 29.6957 28.0967 

300018 ............................................................................. 1.3882 1.0668 25.7851 28.0308 29.7209 27.9654 

300019 ............................................................................. 1.2223 1.0903 23.8076 25.3845 25.9656 25.1005 

300020 ............................................................................. 1.1875 1.0903 24.8189 26.8402 28.6723 26.8622 

300022 ............................................................................. 1.1118 1.0668 22.3918 23.5948 24.4048 23.4922 

300023 ............................................................................. 1.4230 1.0668 24.9992 25.4873 28.6309 26.4774 

300024 ............................................................................. 1.2139 1.0668 22.4883 23.9205 * 23.2005 

300029 ............................................................................. 1.7645 1.0668 24.5772 26.9484 29.0806 26.9920 

300034 ............................................................................. 2.0805 1.0903 26.9093 28.5375 29.7484 28.4471 

310001 ............................................................................. 1.7701 1.3191 30.1786 33.9360 35.3612 33.2483 

310002 ............................................................................. 1.8371 1.3191 33.9058 35.4567 37.3461 35.5944 

310003 ............................................................................. 1.2057 1.3191 30.4234 31.1040 32.8935 31.5180 

310005 ............................................................................. 1.3245 1.2192 26.0227 27.5690 29.0084 27.5943 

310006 ............................................................................. 1.2346 1.3191 25.9000 27.0436 27.4545 26.7958 

310008 ............................................................................. 1.3149 1.3191 28.0970 29.5857 31.2579 29.6725 

310009 ............................................................................. 1.2458 1.3191 24.6353 29.7760 32.7384 29.0885 

310010 ............................................................................. 1.2847 1.0837 26.7889 25.3139 28.5852 26.9172 

310011 ............................................................................. 1.2662 1.1031 26.1586 28.5241 30.8612 28.5543 

310012 ............................................................................. 1.6801 1.3191 31.1705 33.1622 34.6882 33.0545 

310013 ............................................................................. 1.3585 1.3191 25.0951 28.5016 30.6248 28.1586 

310014 ............................................................................. 1.8139 1.0607 29.1931 32.7222 29.7204 30.4762 

310015 ............................................................................. 1.8694 1.3191 30.1767 32.4980 36.4776 33.0707 

310016 ............................................................................. 1.3353 1.3191 25.7368 28.9788 33.9862 29.9150 

310017 ............................................................................. 1.3378 1.2192 25.2636 28.0930 30.9233 28.1646 

310018 ............................................................................. 1.1407 1.3191 25.9108 26.9399 30.3381 27.8107 

310019 ............................................................................. 1.6282 1.3191 26.8663 31.0524 29.6592 29.1388 

310020 ............................................................................. 1.5855 1.3191 25.0147 29.3392 30.6722 28.2107 

310021 ............................................................................. 1.6207 1.0837 29.4003 29.6308 31.3410 30.1313 

310022 ............................................................................. 1.2275 1.0607 26.7487 26.1914 28.2024 27.0808 

310024 ............................................................................. 1.3520 1.2192 26.9499 27.5278 30.9171 28.3714 

310025 ............................................................................. 1.2683 1.3191 26.8719 27.7960 31.1274 28.7415 

310026 ............................................................................. 1.2192 1.3191 24.6697 25.3970 27.5171 25.9064 

310027 ............................................................................. 1.2914 1.2192 22.1935 27.0982 53.3590 32.8604 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23517 

TABLE 2.—HOSPITAL CASE-MIX INDEXES FOR DISCHARGES OCCURRING IN FEDERAL FISCAL YEAR 2004; HOSPITAL AVERAGE HOURLY WAGE FOR FEDERAL FISCAL YEARS 2004 (2000 WAGE DATA), 2005 (2001 WAGE DATA), AND 2006 

(2002 WAGE DATA) WAGE INDEXES AND 3-YEAR AVERAGE OF HOSPITAL AVERAGE HOURLY WAGES—Continued 

Provider number Case-mix 

index 

Wage index 

FY 2006 

Average 

hourly wage 

FY 2004 

Average 

hourly wage 

FY 2005 

Average 

hourly wage 

FY 2006 

Average 

hourly 

wage ** 

(3 years) 

310028 ............................................................................. 1.2218 1.2192 25.7246 29.1101 31.3849 28.7946 

310029 ............................................................................. 1.8622 1.0607 25.9606 29.1439 30.7707 28.6905 

310031 ............................................................................. 2.9677 1.1301 29.5581 30.2345 33.9685 31.2972 

310032 ............................................................................. 1.2894 1.0652 25.7088 27.8754 27.5232 27.0476 

310034 ............................................................................. 1.3320 1.1301 26.5224 27.8517 29.9162 28.1036 

310037 ............................................................................. 1.3242 1.3191 30.1264 32.1471 35.0329 32.5209 

310038 ............................................................................. 1.9813 1.3191 32.3865 32.1977 33.4822 32.7188 

310039 ............................................................................. 1.2457 1.1301 24.6045 27.1054 28.8292 26.9337 

310040 ............................................................................. 1.3638 1.3191 27.4041 28.0068 34.1113 29.8744 

310041 ............................................................................. 1.2679 1.1301 26.8145 29.7335 32.8085 29.8863 

310042 ............................................................................. 1.1514 1.3191 26.9695 29.0207 30.7358 28.9101 

310044 ............................................................................. 1.3163 1.0837 25.1618 27.7752 31.3206 28.1678 

310045 ............................................................................. 1.5833 1.3191 31.7376 32.6359 34.0151 32.8526 

310047 ............................................................................. 1.3107 1.1618 26.1353 28.3415 32.8380 29.2921 

310048 ............................................................................. 1.3562 1.2192 27.4050 28.4715 30.2025 28.7345 

310049 ............................................................................. *** * 26.5332 32.7666 27.8564 27.2897 

310050 ............................................................................. 1.2751 1.2192 25.3772 27.2276 27.3033 26.7397 

310051 ............................................................................. 1.3708 1.2192 29.2386 32.0113 33.7168 31.6981 

310052 ............................................................................. 1.3032 1.1301 27.0324 28.1498 30.8036 28.6341 

310054 ............................................................................. 1.2802 1.3191 28.1880 30.6905 34.1860 31.0476 

310057 ............................................................................. 1.3058 1.0607 26.3903 26.4606 29.5221 27.5782 

310058 ............................................................................. 1.0940 1.3191 28.1753 26.4816 28.0815 27.5746 

310060 ............................................................................. 1.2669 1.0607 22.1914 23.2146 25.1575 23.5782 

310061 ............................................................................. 1.2605 1.0607 24.9678 27.5400 28.2129 26.9521 

310063 ............................................................................. 1.3317 1.2192 25.9868 28.3457 31.4884 28.5345 

310064 ............................................................................. 1.5192 1.1618 27.8388 29.5979 33.4440 30.4173 

310067 ............................................................................. *** 1.2192 26.3624 26.8068 * 26.5479 

310069 ............................................................................. 1.2630 1.0652 25.7690 27.9656 28.1681 27.3281 

310070 ............................................................................. 1.3475 1.3191 30.1917 32.1806 33.2310 31.9325 

310072 ............................................................................. *** * 25.3145 26.3520 * 25.8709 

310073 ............................................................................. 1.7716 1.1301 28.8791 29.6611 32.0329 30.2191 

310074 ............................................................................. 1.2859 1.3191 27.6789 28.4361 29.4834 28.5348 

310075 ............................................................................. 1.2656 1.1301 25.7726 26.2479 31.6870 27.8786 

310076 ............................................................................. 1.5940 1.3191 32.4533 34.9428 36.4280 34.6292 

310077 ............................................................................. 1.6607 1.3191 28.7352 30.7465 32.6644 30.7450 

310078 ............................................................................. 1.2963 1.3191 24.7753 26.9589 29.8014 27.2209 

310081 ............................................................................. 1.2485 1.0607 24.6083 26.4259 26.6136 25.9041 

310083 ............................................................................. 1.2961 1.3191 25.2465 24.6563 28.2392 25.9836 

310084 ............................................................................. 1.2192 1.1301 27.3680 29.9437 32.9001 30.0920 

310086 ............................................................................. 1.2110 1.0607 25.2751 27.3601 29.3058 27.3522 

310088 ............................................................................. 1.1766 1.1618 23.7846 25.5274 26.4966 25.2810 

310090 ............................................................................. 1.2599 1.2192 25.3640 27.1661 30.8941 27.8574 

310091 ............................................................................. 1.1909 1.0652 25.6405 27.1115 27.7204 26.8559 

310092 ............................................................................. 1.3547 1.0837 23.2226 25.7071 29.4999 26.1525 

310093 ............................................................................. 1.1809 1.3191 24.6942 25.8727 28.0401 26.2654 

310096 ............................................................................. 2.0766 1.3191 28.4705 30.3675 34.4275 31.1262 

310105 ............................................................................. 1.2212 1.3191 28.7333 30.9968 31.9769 30.6308 

310108 ............................................................................. 1.3809 1.1301 24.9090 29.1548 30.1002 28.0512 

310110 ............................................................................. 1.2871 1.0837 26.4175 27.8707 31.2164 28.8347 

310111 ............................................................................. 1.1936 1.1301 26.2496 28.8692 30.7475 28.7020 

310112 ............................................................................. 1.2335 1.1301 27.8796 28.9928 30.4192 29.1502 

310113 ............................................................................. 1.2365 1.1301 25.9143 27.5203 29.6079 27.7501 

310115 ............................................................................. 1.2658 1.0607 24.5413 26.2803 29.6020 26.9083 

310116 ............................................................................. 1.2404 1.3191 25.1189 26.6287 25.6976 25.7970 

310118 ............................................................................. 1.2786 1.3191 28.0517 28.1238 28.8797 28.3510 

310119 ............................................................................. 1.7690 1.3191 34.7468 35.6786 37.7876 36.1340 

310120 ............................................................................. 1.1565 1.2192 24.7078 27.2010 31.4110 27.6263 

320001 ............................................................................. 1.4765 0.9696 23.0290 26.1962 26.9434 25.3673 

320002 ............................................................................. 1.3821 1.0908 26.7332 28.6963 30.5158 28.6521 

320003 ............................................................................. 1.1105 0.8649 20.7939 22.3911 28.1402 23.4549 

320004 ............................................................................. 1.2830 0.8649 19.4799 24.0362 24.9481 23.1709 

320005 ............................................................................. 1.4230 0.9558 22.1677 21.2164 23.8264 22.4376 

320006 ............................................................................. 1.3163 1.0163 21.1222 22.5615 24.2812 22.6734 

320009 ............................................................................. 1.5090 0.9696 21.5870 24.4237 22.8293 22.9608 

320011 ............................................................................. 1.1653 0.8649 20.7714 23.1539 24.2279 22.7686 

320013 ............................................................................. 1.1462 1.0163 19.4487 27.8671 28.9276 24.8284 

320014 ............................................................................. 1.1040 0.8649 19.7656 26.7112 24.5310 23.5594 

23518 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

TABLE 2.—HOSPITAL CASE-MIX INDEXES FOR DISCHARGES OCCURRING IN FEDERAL FISCAL YEAR 2004; HOSPITAL AVERAGE HOURLY WAGE FOR FEDERAL FISCAL YEARS 2004 (2000 WAGE DATA), 2005 (2001 WAGE DATA), AND 2006 

(2002 WAGE DATA) WAGE INDEXES AND 3-YEAR AVERAGE OF HOSPITAL AVERAGE HOURLY WAGES—Continued 

Provider number Case-mix 

index 

Wage index 

FY 2006 

Average 

hourly wage 

FY 2004 

Average 

hourly wage 

FY 2005 

Average 

hourly wage 

FY 2006 

Average 

hourly 

wage ** 

(3 years) 

320016 ............................................................................. 1.1520 0.8649 19.9326 21.7001 23.5040 21.7285 

320017 ............................................................................. 1.2523 0.9696 22.5460 23.6861 25.0286 23.7296 

320018 ............................................................................. 1.4565 0.8649 21.4650 23.0915 23.2360 22.6002 

320019 ............................................................................. 1.5397 0.9696 26.6900 31.2250 31.5192 29.7045 

320021 ............................................................................. 1.6254 0.9696 21.0913 28.5620 27.2357 25.1851 

320022 ............................................................................. 1.0969 0.8649 20.7919 22.1492 23.7160 22.2284 

320030 ............................................................................. 1.0284 0.8649 16.8696 18.0990 22.1971 18.9458 

320033 ............................................................................. 1.1545 1.0163 24.2703 24.1185 27.6393 25.3263 

320037 ............................................................................. 1.1552 0.9696 19.6466 21.6080 23.3999 21.6108 

320038 ............................................................................. 1.1959 0.8649 19.2962 21.2181 20.1533 20.2270 

320046 ............................................................................. 1.1718 0.8649 21.5915 22.9114 24.3534 22.9610 

320063 ............................................................................. 1.2785 0.9593 20.7804 24.9141 24.4696 23.4155 

320065 ............................................................................. 1.0973 0.9593 19.9012 21.6189 26.6603 22.8070 

320067 ............................................................................. 0.8271 0.8649 13.9459 20.4431 23.7745 19.8406 

320069 ............................................................................. 1.0924 0.8649 18.5375 19.7296 20.9167 19.7352 

320074 ............................................................................. 1.1664 0.9696 28.3086 35.5980 22.2175 28.2084 

320079 ............................................................................. 1.1142 0.9696 21.9090 23.8092 25.2105 23.6814 

320083 ............................................................................. 2.5985 0.9696 20.6771 * 28.2114 23.7546 

320084 ............................................................................. 1.0974 0.8649 * * 17.2511 17.2511 

320085 ............................................................................. 1.6090 0.8649 * * 24.8752 24.8752 

330001 ............................................................................. *** 1.3191 30.8509 31.3735 33.4718 31.9148 

330002 ............................................................................. 1.4447 1.3191 28.0882 29.3459 31.1924 29.5603 

330003 ............................................................................. 1.2641 0.8565 20.2744 21.6506 22.9945 21.6443 

330004 ............................................................................. 1.2725 1.0576 24.3703 23.9959 26.0445 24.8414 

330005 ............................................................................. 1.5973 0.8888 24.3578 25.9287 * 25.1198 

330006 ............................................................................. 1.2917 1.3191 28.3904 29.7509 31.5370 29.8730 

330008 ............................................................................. 1.1113 0.8888 20.6816 21.3269 21.8198 21.2850 

330009 ............................................................................. 1.2845 1.3191 33.3605 35.8367 35.4986 34.8796 

330010 ............................................................................. *** * 19.8211 17.9178 19.6920 19.0804 

330011 ............................................................................. 1.2998 0.8588 19.8035 20.3641 21.8008 20.6687 

330013 ............................................................................. 2.1105 0.8565 21.2063 23.9070 24.3512 23.1632 

330014 ............................................................................. 1.3351 1.3191 32.0824 35.4053 38.8123 35.4565 

330016 ............................................................................. 0.9933 0.8220 18.1603 18.9388 28.4392 20.9735 

330019 ............................................................................. 1.2932 1.3191 31.9042 32.3413 34.7814 33.0323 

330023 2 ........................................................................... 1.5678 1.0767 29.4538 29.2669 29.8943 29.5534 

330024 ............................................................................. 1.7206 1.3191 35.3598 36.5648 38.8643 36.8845 

330025 ............................................................................. 1.0421 0.8888 18.7663 19.7561 20.2775 19.6152 

330027 ............................................................................. 1.4553 1.3191 34.1281 35.1325 39.0717 36.0189 

330028 ............................................................................. 1.3838 1.3191 31.8452 33.5312 34.2709 33.2330 

330029 ............................................................................. 0.4208 0.8888 18.4354 18.6623 19.1589 18.7332 

330030 ............................................................................. 1.2550 0.9117 22.0574 22.4368 22.9937 22.4866 

330033 ............................................................................. 1.2667 0.8220 18.6316 21.3762 22.5681 20.8260 

330036 ............................................................................. 1.1360 1.3191 27.0970 27.6813 28.9409 27.8674 

330037 ............................................................................. 1.0926 0.9117 18.3557 19.6385 20.6904 19.5992 

330041 ............................................................................. 1.1922 1.3191 34.5461 36.2481 36.0286 35.6239 

330043 ............................................................................. 1.2957 1.2781 31.7873 34.1039 34.7480 33.5850 

330044 ............................................................................. 1.2690 0.8313 22.0465 23.1450 23.8719 23.0325 

330045 ............................................................................. 1.3308 1.2781 30.9046 34.4956 36.1749 33.9185 

330046 ............................................................................. 1.4018 1.3191 41.6759 42.0900 44.8494 42.8629 

330047 h ........................................................................... 1.1968 0.8565 20.1646 21.1244 24.0678 21.8925 

330049 ............................................................................. 1.3533 1.0767 24.7766 25.7022 29.2904 26.5366 

330053 ............................................................................. 1.0847 0.9117 18.1728 19.6807 18.5290 18.7942 

330055 ............................................................................. 1.6314 1.3191 34.9709 35.1393 38.4839 36.2207 

330056 ............................................................................. 1.4539 1.3191 32.0982 32.9295 37.8444 34.2883 

330057 ............................................................................. 1.6969 0.8565 20.9282 22.6519 24.4680 22.6890 

330058 ............................................................................. 1.3165 0.9117 19.2916 19.5520 20.8234 19.9138 

330059 ............................................................................. 1.5179 1.3191 36.4176 38.1019 39.7386 38.0767 

330061 ............................................................................. 1.2264 1.3191 28.6725 32.7427 33.2848 31.6301 

330062 ............................................................................. 1.1819 0.9204 20.0222 21.4270 21.0464 20.8258 

330064 ............................................................................. 1.1415 1.3191 36.0976 38.5719 36.6153 37.0956 

330065 ............................................................................. 1.0281 0.8888 20.5958 21.9192 23.9128 22.1517 

330066 ............................................................................. 1.3120 0.8565 20.9990 23.0916 24.7941 23.0025 

330067 2 ........................................................................... 1.4150 1.0767 24.8927 34.8416 26.4243 28.0084 

330072 ............................................................................. 1.3818 1.3191 32.9665 32.7905 36.4336 34.0607 

330073 ............................................................................. 1.1228 0.9117 18.4162 19.0781 20.1490 19.1772 

330074 ............................................................................. 1.3126 0.9117 21.7299 20.2874 21.4274 21.1093 

330075 ............................................................................. 1.1656 0.9595 19.9781 22.0240 22.4188 21.4854 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23519 

TABLE 2.—HOSPITAL CASE-MIX INDEXES FOR DISCHARGES OCCURRING IN FEDERAL FISCAL YEAR 2004; HOSPITAL AVERAGE HOURLY WAGE FOR FEDERAL FISCAL YEARS 2004 (2000 WAGE DATA), 2005 (2001 WAGE DATA), AND 2006 

(2002 WAGE DATA) WAGE INDEXES AND 3-YEAR AVERAGE OF HOSPITAL AVERAGE HOURLY WAGES—Continued 

Provider number Case-mix 

index 

Wage index 

FY 2006 

Average 

hourly wage 

FY 2004 

Average 

hourly wage 

FY 2005 

Average 

hourly wage 

FY 2006 

Average 

hourly 

wage ** 

(3 years) 

330078 ............................................................................. 1.4256 0.8888 20.8379 22.7762 23.3786 22.3586 

330079 ............................................................................. 1.3180 0.8220 21.1153 22.1064 22.5237 21.9214 

330080 ............................................................................. 1.1477 1.3191 33.5537 36.1171 39.1724 36.3260 

330084 ............................................................................. 1.0829 0.8220 19.2135 22.6365 21.5455 21.1058 

330085 ............................................................................. 1.1913 0.9315 21.8271 23.2927 23.9568 23.0352 

330086 ............................................................................. 1.3193 1.3191 27.1585 28.8425 29.1784 28.3884 

330088 ............................................................................. 1.0442 1.2781 29.5181 31.2631 * 39.0244 

330090 ............................................................................. 1.4373 0.8276 20.9327 22.7721 23.6174 22.4292 

330091 ............................................................................. 1.3675 0.8888 22.9396 22.5796 23.1637 22.8973 

330094 ............................................................................. 1.2532 0.8904 21.3659 22.1495 23.0001 22.1769 

330095 ............................................................................. *** * 28.9794 28.9914 31.9872 29.7944 

330096 ............................................................................. 1.0690 0.8220 21.1648 22.4895 22.0337 21.9119 

330097 ............................................................................. 1.1327 0.8220 18.6291 19.2233 20.2158 19.3250 

330100 ............................................................................. 1.0066 1.3191 31.5775 32.8406 34.4621 32.9762 

330101 ............................................................................. 1.8242 1.3191 38.4810 39.2601 38.7468 38.8311 

330102 ............................................................................. 1.3460 0.8888 23.5254 23.6141 24.8184 23.9846 

330103 ............................................................................. 1.0963 0.8220 17.9017 18.8763 21.1452 19.3116 

330104 ............................................................................. 1.3563 1.3191 36.8451 33.7556 32.8818 34.4566 

330106 ............................................................................. 1.7244 1.2781 38.7822 39.8558 41.2202 39.9816 

330107 ............................................................................. 1.2325 1.2781 29.1958 31.8528 31.3888 30.7790 

330108 ............................................................................. 1.1108 0.8276 20.2536 21.4680 22.2607 21.3131 

330111 ............................................................................. 1.0397 0.8888 17.7020 17.6185 20.9387 18.7250 

330114 ............................................................................. *** * 19.2566 * * 19.2566 

330119 ............................................................................. 1.7468 1.3191 34.6591 36.5873 39.1114 36.7610 

330121 ............................................................................. 0.9116 0.8220 17.9757 19.7388 23.9397 20.5934 

330122 ............................................................................. *** * 25.6500 26.3849 * 26.0090 

330125 ............................................................................. 1.7658 0.9117 22.8078 24.6945 26.6379 24.8334 

330126 ............................................................................. 1.2826 1.0767 27.7155 28.8299 31.6370 29.4715 

330127 ............................................................................. 1.2655 1.3191 42.2836 43.7479 44.4667 43.5141 

330128 ............................................................................. 1.1790 1.3191 32.7050 34.5289 * 33.6278 

330132 ............................................................................. 1.0730 0.8220 16.0311 16.3088 17.4946 16.8474 

330133 ............................................................................. 1.3118 1.3191 35.3136 44.0704 36.6962 38.2248 

330135 ............................................................................. 1.2237 1.0767 25.6504 26.9969 29.0837 27.3649 

330136 ............................................................................. 1.4654 0.9315 21.4225 22.5447 24.2010 22.7506 

330140 ............................................................................. 1.7896 0.9595 21.1787 23.5774 25.7573 23.5011 

330141 ............................................................................. 1.3034 1.2781 29.3283 30.6616 34.8902 31.6934 

330144 ............................................................................. 1.0332 0.8220 17.3920 20.1805 20.9935 19.3948 

330148 ............................................................................. 1.0266 0.8313 17.6560 18.5443 * 18.0744 

330151 ............................................................................. 1.1030 0.8220 16.4028 17.6782 19.1841 17.7056 

330152 ............................................................................. 1.3177 1.3191 32.3332 32.0616 36.5136 33.6447 

330153 ............................................................................. 1.7022 0.8565 21.2843 21.9935 23.7172 22.3124 

330157 ............................................................................. 1.3678 0.9315 23.5522 23.6939 24.9042 24.0644 

330158 ............................................................................. 1.5489 1.3191 32.7159 33.0067 32.2990 32.6514 

330159 ............................................................................. 1.3811 0.9595 22.5580 24.1916 28.8391 25.0788 

330160 ............................................................................. 1.5392 1.3191 32.1266 34.0373 34.1960 33.4347 

330162 ............................................................................. 1.2612 1.3191 29.6042 31.3812 32.1783 31.0913 

330163 ............................................................................. 1.2015 0.8888 21.1517 22.4644 24.0200 22.5391 

330164 ............................................................................. 1.4792 0.9117 23.5427 24.4306 28.8481 25.6753 

330166 h ........................................................................... 1.0593 0.8220 18.4262 18.8777 19.4360 18.9008 

330167 ............................................................................. 1.7665 1.2781 30.9667 33.7365 34.4405 33.1152 

330169 ............................................................................. 1.4095 1.3191 36.2725 38.3498 39.3361 37.9349 

330171 ............................................................................. 1.1728 1.3191 25.9946 27.7810 30.0122 27.7871 

330175 ............................................................................. 1.1137 0.8220 20.4628 21.1944 22.2067 21.3007 

330177 ............................................................................. 0.9453 0.8220 19.0005 20.1850 19.6100 19.6031 

330180 ............................................................................. 1.2265 0.8565 19.8951 21.9641 22.1920 21.3178 

330181 ............................................................................. 1.3091 1.3191 37.1218 35.8846 38.5351 37.1836 

330182 ............................................................................. 2.3204 1.3191 35.2416 36.3831 39.6038 37.1311 

330184 ............................................................................. 1.4141 1.3191 30.7479 33.2843 34.4044 32.7893 

330185 ............................................................................. 1.2671 1.2781 28.9787 31.0179 32.3466 30.8714 

330188 ............................................................................. 1.2490 0.8888 21.1196 22.6803 23.9210 22.6030 

330189 ............................................................................. 0.9765 0.8565 19.0726 19.2538 21.6229 19.9266 

330191 ............................................................................. 1.2880 0.8565 20.9392 22.3719 24.0232 22.4577 

330193 ............................................................................. 1.2567 1.3191 36.2427 36.9866 37.1807 36.8214 

330194 ............................................................................. 1.7888 1.3191 38.5372 39.9177 43.9910 40.8421 

330195 ............................................................................. 1.7407 1.3191 36.4249 38.6867 40.0206 38.4696 

330196 ............................................................................. 1.2724 1.3191 31.1915 32.5883 33.2171 32.3484 

330197 ............................................................................. 1.1300 0.8220 20.8386 22.3117 23.4291 22.2164 

23520 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

TABLE 2.—HOSPITAL CASE-MIX INDEXES FOR DISCHARGES OCCURRING IN FEDERAL FISCAL YEAR 2004; HOSPITAL AVERAGE HOURLY WAGE FOR FEDERAL FISCAL YEARS 2004 (2000 WAGE DATA), 2005 (2001 WAGE DATA), AND 2006 

(2002 WAGE DATA) WAGE INDEXES AND 3-YEAR AVERAGE OF HOSPITAL AVERAGE HOURLY WAGES—Continued 

Provider number Case-mix 

index 

Wage index 

FY 2006 

Average 

hourly wage 

FY 2004 

Average 

hourly wage 

FY 2005 

Average 

hourly wage 

FY 2006 

Average 

hourly 

wage ** 

(3 years) 

330198 ............................................................................. 1.3527 1.2781 25.3622 29.5359 30.5485 28.5487 

330199 ............................................................................. 1.1121 1.3191 34.1354 32.7870 35.0059 33.9687 

330201 ............................................................................. 1.6454 1.3191 29.3745 33.3215 39.3682 33.7813 

330202 ............................................................................. 1.2540 1.3191 30.7990 34.3545 35.0804 33.5414 

330203 ............................................................................. 1.4787 0.9595 24.7422 26.2459 26.5882 25.8191 

330204 ............................................................................. 1.3191 1.3191 30.3699 30.3273 37.6849 32.8372 

330205 ............................................................................. 1.2677 1.0767 29.0622 30.0101 32.1617 30.4707 

330208 ............................................................................. 1.1879 1.3191 30.6158 28.2667 29.6282 29.4819 

330209 ............................................................................. 1.1738 1.0767 27.7071 28.7213 29.7988 28.7477 

330211 ............................................................................. 1.1533 0.8220 20.8224 21.1094 22.9966 21.6469 

330212 ............................................................................. *** 1.3191 24.9434 27.0585 27.2232 26.1185 

330213 ............................................................................. 1.1308 0.8220 20.7967 21.7208 22.5191 21.6931 

330214 ............................................................................. 1.9065 1.3191 32.7647 33.7670 37.8500 34.8451 

330215 ............................................................................. 1.3146 0.8313 19.9226 20.6343 22.5715 21.0552 

330218 ............................................................................. 1.0371 0.9595 20.6012 21.4095 24.1106 22.0618 

330219 ............................................................................. 1.6407 0.8888 28.7448 27.7400 29.3803 28.6143 

330221 ............................................................................. 1.3773 1.3191 34.9345 34.7033 36.5539 35.4233 

330222 ............................................................................. 1.2919 0.8565 23.5491 25.9825 23.9746 24.4778 

330223 ............................................................................. 1.0310 0.8220 18.8253 18.4291 19.4229 18.9058 

330224 ............................................................................. 1.2912 0.9260 22.7847 23.9379 25.7396 24.1533 

330225 ............................................................................. 1.1790 1.2781 29.1744 28.9952 29.2719 29.1527 

330226 ............................................................................. 1.3067 0.9117 23.5405 23.4783 21.8977 22.8832 

330229 h ........................................................................... 1.1699 0.8424 18.5590 19.5670 20.6095 19.5838 

330230 ............................................................................. 0.9941 1.3191 32.5997 32.1101 33.3175 32.6586 

330231 ............................................................................. 0.9977 1.3191 30.2184 33.9324 37.0175 33.7403 

330232 ............................................................................. 1.1923 0.8565 21.1277 21.4765 24.2810 22.2924 

330233 ............................................................................. 1.4170 1.3191 39.5133 41.9968 45.5132 42.4372 

330234 ............................................................................. 2.2593 1.3191 37.7135 36.8500 40.6314 38.3961 

330235 ............................................................................. 1.1320 0.9315 21.4643 22.1217 23.3866 22.3225 

330236 ............................................................................. 1.4277 1.3191 31.8491 32.9391 35.6347 33.4921 

330238 ............................................................................. 1.2507 0.9117 18.3846 19.2407 20.8639 19.5443 

330239 h ........................................................................... 1.2261 0.8424 19.7561 20.4936 21.5397 20.5927 

330240 ............................................................................. 1.2179 1.3191 37.3866 40.7478 36.7910 38.3109 

330241 ............................................................................. 1.8763 0.9595 26.7598 27.7213 29.0882 27.8974 

330242 ............................................................................. 1.2925 1.3191 30.5172 32.2178 46.0013 35.2529 

330245 ............................................................................. 1.9001 0.8313 20.2037 21.6857 22.7032 21.5626 

330246 ............................................................................. 1.3295 1.2781 31.8857 31.6763 34.6329 32.7279 

330247 ............................................................................. 1.0067 1.3191 25.6063 32.1733 32.2300 29.8298 

330249 ............................................................................. 1.2019 0.9595 19.1469 21.4345 22.9834 21.2588 

330250 ............................................................................. 1.2791 0.9306 22.1272 23.0641 25.1664 23.4900 

330259 ............................................................................. 1.4142 1.2781 27.4131 30.0488 31.9495 29.9063 

330261 ............................................................................. 1.2516 1.3191 30.4771 30.9356 30.7942 30.7386 

330263 ............................................................................. 0.9776 0.8220 20.0831 20.8456 22.4675 21.1560 

330264 ............................................................................. 1.2367 1.0767 26.3652 28.1501 30.0139 28.1122 

330265 ............................................................................. 1.2729 0.9117 18.2547 19.9414 20.4635 19.5583 

330267 ............................................................................. 1.4649 1.3191 29.0499 30.3709 31.5478 30.3522 

330268 ............................................................................. 0.9506 0.8565 18.7991 18.9142 20.9720 19.5863 

330270 ............................................................................. 2.0316 1.3191 36.5976 38.2605 52.4880 42.6074 

330273 ............................................................................. 1.4020 1.3191 28.8548 29.5106 30.3976 29.6096 

330276 ............................................................................. 1.1013 0.8220 20.7973 21.7826 22.2353 21.6210 

330277 ............................................................................. 1.1667 0.9204 21.8866 25.1438 25.3582 24.1682 

330279 ............................................................................. 1.4462 0.8888 23.8793 23.4816 24.9772 24.1439 

330285 ............................................................................. 1.9363 0.9117 26.0446 27.1260 27.9018 27.0364 

330286 ............................................................................. 1.3657 1.2781 31.1344 32.3244 33.3377 32.3174 

330290 ............................................................................. 1.7357 1.3191 35.5617 36.3764 36.9981 36.3009 

330293 ............................................................................. *** * 17.6506 19.0290 * 18.3452 

330304 ............................................................................. 1.2821 1.3191 31.1146 33.4431 34.5111 33.0739 

330306 ............................................................................. 1.4608 1.3191 30.4426 30.7551 35.6640 32.2831 

330307 ............................................................................. 1.2103 0.9855 23.8583 25.4128 27.5699 25.6624 

330314 ............................................................................. 1.2270 1.2781 26.2954 26.0150 25.5597 25.9594 

330316 ............................................................................. 1.2997 1.3191 33.7857 33.1512 34.8623 33.9322 

330327 ............................................................................. *** * 19.3465 * * 19.3465 

330332 ............................................................................. 1.2570 1.2781 30.5104 31.8389 33.0652 31.9293 

330333 ............................................................................. *** 1.2781 29.7725 33.7637 26.1917 29.6723 

330336 ............................................................................. *** * 32.9548 * * 32.9548 

330339 ............................................................................. 0.8062 0.8565 20.8424 22.2812 22.6569 21.9390 

330340 ............................................................................. 1.1756 1.2781 29.8140 31.4322 33.5504 31.6312 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23521 

TABLE 2.—HOSPITAL CASE-MIX INDEXES FOR DISCHARGES OCCURRING IN FEDERAL FISCAL YEAR 2004; HOSPITAL AVERAGE HOURLY WAGE FOR FEDERAL FISCAL YEARS 2004 (2000 WAGE DATA), 2005 (2001 WAGE DATA), AND 2006 

(2002 WAGE DATA) WAGE INDEXES AND 3-YEAR AVERAGE OF HOSPITAL AVERAGE HOURLY WAGES—Continued 

Provider number Case-mix 

index 

Wage index 

FY 2006 

Average 

hourly wage 

FY 2004 

Average 

hourly wage 

FY 2005 

Average 

hourly wage 

FY 2006 

Average 

hourly 

wage ** 

(3 years) 

330350 ............................................................................. 1.4934 1.3191 35.5656 39.3541 36.6250 37.1672 

330353 ............................................................................. 1.1504 1.3191 35.6821 38.6962 37.6549 37.3737 

330357 ............................................................................. 1.2908 1.3191 36.5461 34.3965 35.5975 35.5017 

330372 ............................................................................. 1.2505 1.2781 28.2490 30.1505 32.6721 30.3998 

330385 ............................................................................. 1.1112 1.3191 44.3387 42.6671 34.7820 40.7280 

330386 ............................................................................. 1.2069 1.0576 25.2064 25.9228 27.9943 26.4367 

330389 ............................................................................. 1.9214 1.3191 32.2112 34.7552 34.7669 33.9210 

330390 ............................................................................. 1.2676 1.3191 32.7450 33.2628 36.0573 33.8898 

330393 ............................................................................. 1.7382 1.2781 33.0953 34.8213 34.8095 34.2742 

330394 ............................................................................. 1.6408 0.8588 21.3678 23.3505 25.2229 23.3324 

330395 ............................................................................. 1.3921 1.3191 32.1089 35.4619 39.6666 35.4994 

330396 ............................................................................. 1.2486 1.3191 31.2429 32.5345 35.0297 32.9828 

330397 ............................................................................. 1.3537 1.3191 40.0884 34.5110 38.4741 37.5361 

330399 ............................................................................. 1.1709 1.3191 32.1248 33.6753 32.3688 32.7392 

330401 ............................................................................. 1.3161 1.2781 33.8633 35.7435 40.5332 36.7926 

330402 ............................................................................. 0.7916 0.9260 * 21.3302 * 21.3302 

330403 ............................................................................. *** 0.9117 * * 23.1887 23.1887 

340001 ............................................................................. 1.4809 0.9717 21.6113 23.2436 25.0041 23.2441 

340002 ............................................................................. 1.7358 0.9312 24.0145 25.1099 27.3349 25.5169 

340003 ............................................................................. 1.0930 0.8570 20.8205 21.5562 23.3066 21.9251 

340004 ............................................................................. 1.4023 0.9020 23.3756 24.2055 25.4474 24.3851 

340005 ............................................................................. 0.9977 0.8570 20.8150 22.9830 22.3814 22.0177 

340007 ............................................................................. *** 0.9133 19.5208 21.1519 * 20.3174 

340008 ............................................................................. 1.0820 0.9585 22.7338 24.2089 26.6314 25.0622 

340010 ............................................................................. 1.3214 0.9476 21.3024 23.1349 24.5666 23.0280 

340011 ............................................................................. 1.0509 0.8570 18.1926 18.1843 19.9484 18.7756 

340012 ............................................................................. 1.2823 0.8570 19.6350 22.0583 22.7189 21.4818 

340013 ............................................................................. 1.2354 0.9585 21.0066 22.4787 23.0261 22.1688 

340014 ............................................................................. 1.5332 0.9020 22.6757 24.4831 25.1872 24.1069 

340015 h ........................................................................... 1.3596 0.9717 24.3410 24.3870 26.2276 25.0387 

340016 ............................................................................. 1.2110 0.8570 20.2859 22.7574 23.0359 22.0228 

340017 ............................................................................. 1.2648 0.9312 21.7083 22.8879 23.8229 22.8228 

340018 ............................................................................. 1.1294 0.9183 17.3480 20.3840 23.7243 20.2881 

340019 ............................................................................. 0.9618 0.9020 16.7901 17.8768 * 17.3292 

340020 ............................................................................. 1.1895 0.8570 21.3385 24.1955 23.7995 23.1233 

340021 ............................................................................. 1.2956 0.9585 22.9208 23.6884 26.0995 24.2587 

340022 ............................................................................. *** 0.8570 19.9078 * * 19.9078 

340024 ............................................................................. 1.1553 0.8570 20.4906 21.2671 22.2521 21.3515 

340025 ............................................................................. 1.2401 0.9312 20.2864 20.9915 21.2276 20.8493 

340027 ............................................................................. 1.1523 0.9414 21.0975 22.6107 23.6326 22.4564 

340028 ............................................................................. 1.5451 0.9426 22.2028 24.6836 26.3298 24.3471 

340030 ............................................................................. 2.0360 1.0260 26.7753 27.4664 29.3043 27.9060 

340032 ............................................................................. 1.3877 0.9717 23.2204 24.8031 26.7475 25.0122 

340035 ............................................................................. 1.0281 0.8570 16.4821 21.2407 23.5476 20.1377 

340036 ............................................................................. 1.1712 0.9709 20.8313 22.2089 25.2077 22.9528 

340037 ............................................................................. 1.0024 0.8570 21.9524 22.5089 21.6411 22.0344 

340038 ............................................................................. 1.1871 0.8570 13.9936 14.0203 14.0713 14.0327 

340039 ............................................................................. 1.2862 0.9585 24.8246 25.6605 27.1275 25.9204 

340040 ............................................................................. 1.9063 0.9414 22.4777 24.1523 26.3325 24.3631 

340041 ............................................................................. 1.2302 0.8931 17.6319 23.0497 23.4891 21.2362 

340042 ............................................................................. 1.0903 0.8570 21.1107 22.1107 23.0236 22.0702 

340044 ............................................................................. 0.9395 0.8570 18.2154 21.7089 22.8948 20.8194 

340045 ............................................................................. 0.9726 0.8570 17.4066 14.5004 23.1918 18.0750 

340047 ............................................................................. 1.8926 0.9020 22.5199 25.3727 25.0605 24.3496 

340049 ............................................................................. 2.0329 1.0260 21.2734 22.3082 30.4827 24.7548 

340050 ............................................................................. 1.0881 0.9193 20.3262 21.4511 24.2533 22.0481 

340051 ............................................................................. 1.2288 0.8931 20.3057 21.9069 23.4091 21.9456 

340053 ............................................................................. 1.5911 0.9717 24.9768 26.9361 27.7261 26.5947 

340055 ............................................................................. 1.2318 0.8931 23.2990 24.3728 24.1057 23.9407 

340060 ............................................................................. 1.0613 0.9133 20.8077 22.4303 22.8657 22.0570 

340061 ............................................................................. 1.8009 1.0260 25.1081 26.6657 27.5594 26.4994 

340064 ............................................................................. 1.0787 0.8570 19.4523 22.3631 22.9143 21.5916 

340065 ............................................................................. 1.1887 0.8570 20.3296 20.8413 * 20.5941 

340067 ............................................................................. *** * 22.2565 * * 22.2565 

340069 ............................................................................. 1.8692 0.9993 24.4650 27.5045 27.4473 26.5163 

340070 ............................................................................. 1.2588 0.8902 22.2605 23.6045 24.9033 23.6142 

340071 ............................................................................. 1.1237 0.9476 19.9561 22.1854 25.4537 22.5747 

23522 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

TABLE 2.—HOSPITAL CASE-MIX INDEXES FOR DISCHARGES OCCURRING IN FEDERAL FISCAL YEAR 2004; HOSPITAL AVERAGE HOURLY WAGE FOR FEDERAL FISCAL YEARS 2004 (2000 WAGE DATA), 2005 (2001 WAGE DATA), AND 2006 

(2002 WAGE DATA) WAGE INDEXES AND 3-YEAR AVERAGE OF HOSPITAL AVERAGE HOURLY WAGES—Continued 

Provider number Case-mix 

index 

Wage index 

FY 2006 

Average 

hourly wage 

FY 2004 

Average 

hourly wage 

FY 2005 

Average 

hourly wage 

FY 2006 

Average 

hourly 

wage ** 

(3 years) 

340072 ............................................................................. 1.1835 0.8570 19.2773 

21.3320 ............................................................................ 22.6474 21.0148 

340073 ............................................................................. 1.3746 0.9993 26.6829 29.4189 30.2076 28.9147 

340075 ............................................................................. 1.2112 0.8931 23.2904 24.1297 26.0225 24.4391 

340084 ............................................................................. 1.1875 0.9717 20.8175 21.3227 21.2580 21.1447 

340085 h ........................................................................... 1.1572 0.9133 21.7112 23.0890 23.9793 22.8869 

340087 ............................................................................. 1.1889 0.8570 17.8215 18.4202 22.0070 19.3351 

340088 ............................................................................. 1.3425 0.8570 22.8687 24.3299 * 23.5994 

340090 ............................................................................. 1.2312 0.9709 20.3261 21.7173 23.4542 21.9222 

340091 ............................................................................. 1.5335 0.9020 23.1430 24.9411 25.8266 24.6682 

340096 h ........................................................................... 1.1818 0.9133 22.1174 23.6345 25.2169 23.6523 

340097 ............................................................................. 1.1843 0.8570 20.8690 22.5775 24.2127 22.5886 

340098 ............................................................................. 1.4546 0.9717 24.2262 25.4823 27.3308 25.7030 

340099 ............................................................................. 1.1671 0.8570 17.5114 20.0178 20.3683 19.3181 

340104 ............................................................................. 0.8280 0.8570 12.9949 14.3252 15.7521 14.3947 

340106 ............................................................................. 1.0782 0.8570 20.1076 22.6979 22.4894 21.8047 

340107 ............................................................................. 1.1794 0.8924 21.0960 22.5583 22.9698 22.2242 

340109 ............................................................................. 1.3188 0.8841 20.4341 22.3826 23.4419 22.1467 

340113 ............................................................................. 1.8523 0.9717 25.0729 26.0776 28.2546 26.5138 

340114 ............................................................................. 1.6227 0.9993 19.9142 25.4533 26.6813 23.7911 

340115 ............................................................................. 1.5773 0.9993 23.8284 25.1907 25.0212 24.7040 

340116 ............................................................................. 1.7011 0.8931 23.9643 26.1641 25.3213 25.1777 

340119 ............................................................................. 1.1252 0.9717 21.2239 22.4821 24.2287 22.6894 

340120 ............................................................................. 1.0360 0.8570 19.9860 21.8548 23.0916 21.7078 

340121 ............................................................................. 1.0374 0.9580 19.9409 20.3701 21.7576 20.7129 

340123 ............................................................................. 1.1858 0.9133 22.3711 23.1879 26.1083 23.9306 

340124 ............................................................................. 1.0791 0.9476 17.5691 18.3866 20.8018 18.8482 

340126 h ........................................................................... 1.2269 0.9709 21.4271 23.5405 25.0189 23.3764 

340127 ............................................................................. 1.1717 0.9993 22.9672 24.6096 25.4786 24.4245 

340129 ............................................................................. 1.2519 0.9585 22.3260 24.1356 25.4902 24.1365 

340130 ............................................................................. 1.3631 0.9717 22.7687 23.0937 25.2941 23.7854 

340131 ............................................................................. 1.5298 0.9414 24.1370 25.2989 27.9358 25.8415 

340132 ............................................................................. 1.1782 0.8570 17.8771 20.4222 21.3521 19.8892 

340133 ............................................................................. 0.9920 0.8570 23.1444 22.1588 22.5558 22.6188 

340137 ............................................................................. 0.9669 0.8931 33.1751 29.9903 21.0642 28.4915 

340138 ............................................................................. 0.8241 0.9993 29.5286 27.4767 * 28.5643 

340141 ............................................................................. 1.6446 0.9580 24.2033 24.8132 27.3355 25.5266 

340142 ............................................................................. 1.1805 0.8570 20.4320 22.1298 22.9907 21.8836 

340143 ............................................................................. 1.4579 0.8931 23.0416 24.8904 25.3633 24.4002 

340144 ............................................................................. 1.2329 0.9585 25.4598 25.6538 27.2686 26.1330 

340145 ............................................................................. 1.2957 0.9585 21.8120 23.7028 23.7131 23.0768 

340146 ............................................................................. 1.0505 0.8570 20.7252 18.8354 * 19.6880 

340147 ............................................................................. 1.2003 0.9476 22.6057 23.9998 25.4534 24.0568 

340148 ............................................................................. 1.3349 0.9020 20.8156 22.4205 23.5880 22.2985 

340151 ............................................................................. 1.1033 0.8570 19.2593 22.2613 22.0052 21.1161 

340153 ............................................................................. 1.9092 0.9717 23.7426 25.7078 26.4896 25.3204 

340155 ............................................................................. 1.4341 1.0260 26.3663 28.8758 30.5006 28.6119 

340158 ............................................................................. 1.1034 0.9580 21.7489 23.4724 26.4849 23.8953 

340159 ............................................................................. 1.1424 1.0260 21.2983 22.1872 23.2991 22.2743 

340160 ............................................................................. 1.2720 0.8570 18.7569 19.1330 20.7525 19.5589 

340166 ............................................................................. 1.3649 0.9717 22.8349 25.7398 26.0557 24.9254 

340168 ............................................................................. *** 0.9580 16.8278 16.8076 17.3249 17.0046 

340171 ............................................................................. 1.1811 0.9717 25.9603 27.2074 28.2734 27.2246 

340173 ............................................................................. 1.2448 0.9993 23.7037 26.6128 27.5072 26.0994 

340176 ............................................................................. *** * 26.5277 * * 26.5277 

340178 ............................................................................. *** 0.9426 * * 28.7219 28.7219 

350002 ............................................................................. 1.7334 0.7519 20.4398 20.6474 22.0283 21.0339 

350003 ............................................................................. 1.1580 0.7278 21.0585 25.3076 21.8061 22.5764 

350004 ............................................................................. *** * 28.3773 27.5891 * 28.0246 

350006 ............................................................................. 1.6770 0.7278 19.7577 19.5870 19.4985 19.5737 

350009 ............................................................................. 1.0756 0.8778 20.2558 20.7014 23.0873 21.3437 

350010 ............................................................................. 1.0942 0.7278 17.2489 18.5682 19.1965 18.3109 

350011 ............................................................................. 1.9473 0.8778 21.9111 22.3896 23.1947 22.5594 

350014 ............................................................................. 0.9131 0.7278 16.1718 18.5360 17.7565 17.4777 

350015 ............................................................................. 1.6703 0.7519 18.5437 18.6381 19.7027 18.9716 

350017 ............................................................................. 1.4352 0.7278 19.1952 20.1943 21.0243 20.1512 

350019 2 ........................................................................... 1.6643 1.1521 21.3589 24.2382 32.2306 26.4362 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23523 

TABLE 2.—HOSPITAL CASE-MIX INDEXES FOR DISCHARGES OCCURRING IN FEDERAL FISCAL YEAR 2004; HOSPITAL AVERAGE HOURLY WAGE FOR FEDERAL FISCAL YEARS 2004 (2000 WAGE DATA), 2005 (2001 WAGE DATA), AND 2006 

(2002 WAGE DATA) WAGE INDEXES AND 3-YEAR AVERAGE OF HOSPITAL AVERAGE HOURLY WAGES—Continued 

Provider number Case-mix 

index 

Wage index 

FY 2006 

Average 

hourly wage 

FY 2004 

Average 

hourly wage 

FY 2005 

Average 

hourly wage 

FY 2006 

Average 

hourly 

wage ** 

(3 years) 

350027 ............................................................................. 1.0413 0.7278 17.6731 14.2262 * 15.5713 

350030 ............................................................................. 0.9514 0.7278 18.8822 19.2282 18.9978 19.0373 

350043 ............................................................................. *** * 18.8378 20.9732 * 19.9618 

350058 ............................................................................. 0.9697 0.7278 15.0196 * * 15.0196 

350070 ............................................................................. 1.9138 0.8778 * 24.4464 25.2836 24.8833 

360001 ............................................................................. 1.3315 0.9604 22.2387 23.7750 23.9101 23.2970 

360002 ............................................................................. 1.1905 0.8788 20.7586 22.6923 24.5789 22.7274 

360003 ............................................................................. 1.8081 0.9604 24.4144 26.3180 27.5029 26.0650 

360006 ............................................................................. 1.9867 0.9848 24.0814 25.7041 27.9925 25.9633 

360007 ............................................................................. *** * 19.1315 * * 19.1315 

360009 ............................................................................. 1.5653 0.9263 22.4076 23.2659 23.1012 22.9250 

360010 ............................................................................. 1.1890 0.8979 20.6290 22.0262 23.1178 21.9858 

360011 ............................................................................. 1.3220 0.9848 21.4293 22.4482 25.5340 23.0257 

360012 ............................................................................. 1.3639 0.9848 24.3618 25.5913 27.5470 25.9629 

360013 ............................................................................. 1.0996 0.9263 24.4232 25.1588 26.8129 25.4875 

360014 ............................................................................. 1.1458 0.9848 22.9372 23.8305 25.3861 24.0832 

360016 ............................................................................. 1.4261 0.9604 22.8430 24.6587 26.1283 24.5377 

360017 ............................................................................. 1.7197 0.9848 23.6181 25.4969 27.2910 25.5905 

360018 ............................................................................. *** * 29.9085 * * 29.9085 

360020 ............................................................................. 1.6198 0.9197 21.5085 22.3795 24.4343 22.8262 

360024 ............................................................................. *** * 22.5356 24.0612 23.5499 23.3173 

360025 ............................................................................. 1.3926 0.9197 21.6676 23.6574 25.5633 23.7829 

360026 ............................................................................. 1.2762 0.9069 20.8825 22.3303 23.5898 22.2676 

360027 ............................................................................. 1.6543 0.9197 23.5907 24.7093 25.4894 24.6187 

360029 ............................................................................. 1.0888 0.9573 20.4924 20.8778 22.7785 21.4073 

360031 ............................................................................. *** * 24.3482 24.4324 * 24.3900 

360032 h ........................................................................... 1.1314 0.9263 21.1743 22.9759 23.2638 22.4807 

360034 ............................................................................. 1.1035 0.8788 21.5621 25.1366 * 23.3553 

360035 ............................................................................. 1.7092 0.9848 24.2433 25.6895 27.5220 25.8774 

360036 ............................................................................. 1.2117 0.9197 22.3567 25.0910 27.6094 25.0649 

360037 ............................................................................. 1.3504 0.9197 32.6245 25.1615 24.3982 26.6839 

360038 ............................................................................. 1.4244 0.9604 23.4855 24.8294 22.8009 23.7144 

360039 ............................................................................. 1.4713 0.9848 23.4642 22.5921 24.0218 23.3755 

360040 ............................................................................. 1.1396 0.8788 21.3307 22.8729 24.0942 22.7498 

360041 ............................................................................. 1.4432 0.9197 22.1352 23.2625 24.1080 23.2048 

360044 ............................................................................. 1.0612 0.8788 19.7212 20.4724 21.8411 20.6845 

360046 ............................................................................. 1.1923 0.9604 22.8425 23.8918 25.0775 23.9800 

360047 ............................................................................. 0.9522 0.8788 17.5885 17.1973 21.7248 18.9388 

360048 ............................................................................. 1.7400 0.9573 24.7150 27.2274 28.8107 26.8831 

360049 ............................................................................. 1.1298 0.9197 22.4939 24.2605 25.8367 24.2864 

360051 ............................................................................. 1.6658 0.9069 23.0658 25.1785 25.7556 24.7297 

360052 ............................................................................. 1.5398 0.9069 22.5005 23.3285 24.5405 23.5101 

360054 ............................................................................. 1.2774 0.8788 19.2884 20.3176 22.6157 20.7734 

360055 ............................................................................. 1.3753 0.8788 23.5586 25.1475 26.3112 24.9991 

360056 ............................................................................. 1.5352 0.9604 22.4475 23.4638 23.1024 22.9631 

360058 ............................................................................. 1.1220 0.8788 21.0768 22.7943 23.4434 22.4515 

360059 ............................................................................. 1.4684 0.9197 23.0775 25.5222 25.3516 24.6433 

360062 ............................................................................. 1.5341 0.9848 24.5746 26.8091 28.6518 26.7475 

360064 ............................................................................. 1.5318 0.8788 21.3424 22.8729 22.2393 22.1811 

360065 ............................................................................. 1.2012 0.9197 22.9727 24.0868 26.3036 24.5445 

360066 ............................................................................. 1.5310 0.9263 24.6806 25.2316 27.3362 25.7779 

360068 ............................................................................. 1.8254 0.9573 22.1110 23.7895 25.8414 23.9678 

360069 ............................................................................. 1.1231 0.9573 20.5349 25.7032 24.2444 23.4234 

360070 ............................................................................. 1.6302 0.8957 21.8228 23.1687 24.8863 23.3191 

360071 h ........................................................................... 1.2089 0.9263 21.4478 21.6176 22.0786 21.6950 

360072 ............................................................................. 1.3941 0.9848 21.3736 23.0464 24.1825 22.9257 

360074 ............................................................................. 1.2640 0.9573 22.2368 23.6172 24.9055 23.6214 

360075 ............................................................................. 1.1808 0.9197 23.8492 24.7610 26.8453 25.2573 

360076 ............................................................................. 1.3773 0.9604 22.5863 22.5943 25.9369 23.7285 

360077 ............................................................................. 1.5368 0.9197 23.3686 24.7086 25.6505 24.5864 

360078 ............................................................................. 1.2606 0.9197 23.3799 24.6821 26.1313 24.7447 

360079 ............................................................................. 1.7689 0.9604 25.9623 25.8762 26.0935 25.9804 

360080 ............................................................................. 1.0696 0.8788 18.7213 19.5436 20.8309 19.7267 

360081 ............................................................................. 1.3058 0.9573 22.1973 25.1439 27.5695 24.8761 

360082 ............................................................................. 1.3694 0.9197 25.2254 27.4264 27.1197 26.6255 

360084 ............................................................................. 1.5327 0.8957 23.3257 25.2059 25.8415 24.8445 

360085 ............................................................................. 2.0605 0.9848 24.6618 27.5792 29.0081 27.1579 

23524 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

TABLE 2.—HOSPITAL CASE-MIX INDEXES FOR DISCHARGES OCCURRING IN FEDERAL FISCAL YEAR 2004; HOSPITAL AVERAGE HOURLY WAGE FOR FEDERAL FISCAL YEARS 2004 (2000 WAGE DATA), 2005 (2001 WAGE DATA), AND 2006 

(2002 WAGE DATA) WAGE INDEXES AND 3-YEAR AVERAGE OF HOSPITAL AVERAGE HOURLY WAGES—Continued 

Provider number Case-mix 

index 

Wage index 

FY 2006 

Average 

hourly wage 

FY 2004 

Average 

hourly wage 

FY 2005 

Average 

hourly wage 

FY 2006 

Average 

hourly 

wage ** 

(3 years) 

360086 ............................................................................. 1.5132 0.9069 21.5983 22.3005 22.1859 22.0265 

360087 ............................................................................. 1.4212 0.9197 23.9638 25.9131 25.4040 25.0901 

360089 ............................................................................. 1.1144 0.8788 21.0229 21.0253 22.7951 21.6142 

360090 ............................................................................. 1.4694 0.9573 22.6236 24.4291 26.7717 24.5859 

360091 ............................................................................. 1.2086 0.9197 23.5759 26.0541 27.5067 25.7352 

360092 ............................................................................. 1.2241 0.9848 21.9732 23.5100 25.6618 23.7647 

360093 ............................................................................. 1.0308 0.8788 21.4623 24.1238 23.2648 22.9528 

360094 ............................................................................. *** * 22.6440 27.1864 26.6348 24.9723 

360095 ............................................................................. 1.2895 0.8788 23.6518 24.6984 * 24.1867 

360096 ............................................................................. 1.0859 0.8788 22.0673 22.2333 24.6317 22.9802 

360098 ............................................................................. 1.4042 0.9197 22.7644 23.6413 24.8447 23.7933 

360099 ............................................................................. *** 0.8788 20.8524 * * 20.8524 

360101 ............................................................................. 1.3585 0.9197 26.2875 27.7584 26.6208 26.9092 

360106 ............................................................................. 1.0794 0.8788 19.8658 21.6450 24.1588 21.9428 

360107 ............................................................................. 1.0416 0.9197 23.6880 24.5365 25.9697 24.7438 

360109 ............................................................................. 1.0852 0.8788 23.0178 24.3236 25.4184 24.2613 

360112 ............................................................................. 2.0143 1.0628 25.5910 26.7880 28.6784 26.9982 

360113 ............................................................................. 1.2415 0.9604 22.3348 23.5138 25.6493 23.7408 

360115 ............................................................................. 1.2494 0.9197 22.3926 24.0232 24.0052 23.4857 

360116 ............................................................................. 1.2224 0.9604 21.3809 23.4049 18.0655 20.9510 

360118 ............................................................................. 1.4861 * 23.0070 24.2526 * 23.6564 

360121 ............................................................................. 1.2367 0.8788 23.2515 25.2037 * 24.2319 

360123 ............................................................................. 1.4129 0.9197 23.1310 24.1761 22.6523 23.2730 

360125 ............................................................................. 1.1792 0.9197 21.1408 22.6871 22.1096 21.9849 

360126 ............................................................................. *** * 22.2409 * * 22.2409 

360129 ............................................................................. 0.9317 0.8788 17.9151 19.5336 * 18.7493 

360130 ............................................................................. 1.4471 0.9197 20.1257 21.7015 22.9762 21.5955 

360131 ............................................................................. 1.2314 0.8957 21.7838 23.1730 24.0495 23.0299 

360132 ............................................................................. 1.2426 0.9604 23.4179 25.7991 25.9453 25.1258 

360133 ............................................................................. 1.6206 0.9069 22.0958 23.9457 24.6208 23.6001 

360134 ............................................................................. 1.6811 0.9604 23.6817 25.3013 29.2975 26.0944 

360137 ............................................................................. 1.6781 0.9197 23.8947 25.7647 26.9522 25.5442 

360141 ............................................................................. 1.6446 0.8788 25.1442 31.0127 27.7085 27.9618 

360142 ............................................................................. 0.9699 0.8788 20.6728 21.2084 22.1610 21.3780 

360143 ............................................................................. 1.3211 0.9197 22.2275 23.8938 24.6306 23.6169 

360144 ............................................................................. 1.3179 0.9197 24.7973 26.7160 24.0350 25.1500 

360145 ............................................................................. 1.7297 0.9197 22.4813 23.4743 25.8268 23.9319 

360147 ............................................................................. 1.3504 0.8788 20.0409 22.7172 24.1953 22.4020 

360148 ............................................................................. 1.0603 0.8788 21.3211 24.4873 26.1946 24.0470 

360150 ............................................................................. 1.1923 0.9197 24.8485 25.8703 24.7667 25.1568 

360151 ............................................................................. 1.4859 0.8957 21.7215 22.2179 24.8629 22.8949 

360152 ............................................................................. 1.4689 0.9848 22.9352 24.9894 27.9147 25.0211 

360153 ............................................................................. 0.9512 0.8788 17.3367 19.0844 19.0226 18.4206 

360154 ............................................................................. 0.9805 0.8788 16.2416 17.1274 * 16.6874 

360155 ............................................................................. 1.4857 0.9197 23.0020 23.9466 25.3787 24.1428 

360156 ............................................................................. 1.1333 0.8788 21.2853 22.6709 24.0510 22.6856 

360159 ............................................................................. 1.2322 0.9848 23.3359 25.7108 33.1613 27.1828 

360161 ............................................................................. 1.3645 0.8788 21.5114 22.6005 24.3792 22.8785 

360163 ............................................................................. 1.8834 0.9604 23.1500 25.7966 26.9728 25.2619 

360170 ............................................................................. 1.1824 0.9848 22.2815 22.9359 24.3620 23.3031 

360172 ............................................................................. 1.3907 0.9197 22.7104 23.4727 26.3388 24.1922 

360174 ............................................................................. 1.2111 0.9069 21.7129 22.8167 24.9990 23.2230 

360175 ............................................................................. 1.1979 0.9848 22.7887 24.6152 26.5949 24.7311 

360177 ............................................................................. 1.1457 0.8788 20.8194 23.4256 24.4712 22.9543 

360178 ............................................................................. *** 0.8788 18.2393 * * 18.2393 

360180 ............................................................................. 2.2595 0.9197 25.1499 26.8720 26.1514 26.0861 

360185 ............................................................................. 1.1807 0.8788 21.1245 21.8641 23.7173 22.2403 

360187 ............................................................................. 1.5760 0.9069 21.9499 23.8362 24.8173 23.5639 

360189 ............................................................................. 1.1222 0.9848 20.0275 24.2512 24.2136 22.8164 

360192 ............................................................................. 1.3138 0.9197 24.9995 26.2976 26.7577 26.0512 

360194 h ........................................................................... 1.1529 * 20.3677 22.3297 * 21.3611 

360195 ............................................................................. 1.0716 0.9197 23.1897 25.8043 26.1280 25.1222 

360197 ............................................................................. 1.0908 0.9848 23.1378 24.7539 26.7508 24.9131 

360203 ............................................................................. 1.1451 0.8788 19.3642 21.5564 22.1414 21.0862 

360210 ............................................................................. 1.1668 0.9848 25.0811 26.5665 27.8415 26.5578 

360211 ............................................................................. 1.5541 0.8840 22.4529 23.0884 22.5449 22.6945 

360212 ............................................................................. 1.3654 0.9197 22.8041 24.5310 25.2756 24.2166 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23525 

TABLE 2.—HOSPITAL CASE-MIX INDEXES FOR DISCHARGES OCCURRING IN FEDERAL FISCAL YEAR 2004; HOSPITAL AVERAGE HOURLY WAGE FOR FEDERAL FISCAL YEARS 2004 (2000 WAGE DATA), 2005 (2001 WAGE DATA), AND 2006 

(2002 WAGE DATA) WAGE INDEXES AND 3-YEAR AVERAGE OF HOSPITAL AVERAGE HOURLY WAGES—Continued 

Provider number Case-mix 

index 

Wage index 

FY 2006 

Average 

hourly wage 

FY 2004 

Average 

hourly wage 

FY 2005 

Average 

hourly wage 

FY 2006 

Average 

hourly 

wage ** 

(3 years) 

360218 ............................................................................. 1.1698 0.9848 22.8060 24.4720 27.4288 25.0106 

360230 ............................................................................. 1.6048 0.9197 24.7681 26.6444 27.0223 26.1931 

360234 ............................................................................. 1.3014 0.9604 22.1787 23.3325 24.2539 23.2304 

360236 ............................................................................. 1.1515 0.9604 22.8821 21.3795 35.8144 24.3729 

360239 ............................................................................. 1.3119 0.9069 23.5802 24.4398 25.2474 24.5362 

360241 ............................................................................. *** 0.9197 23.4061 24.8089 24.7001 24.1133 

360245 ............................................................................. 0.5232 0.9197 18.1015 18.7966 19.1885 18.7327 

360247 ............................................................................. 0.3785 0.9848 * 25.1083 19.8892 22.3390 

360253 ............................................................................. 2.2434 0.9069 31.3006 28.2555 30.4276 29.8452 

360254 ............................................................................. *** * 30.0792 * * 30.0792 

360257 ............................................................................. 1.0766 0.8788 * 17.9652 * 17.9652 

360259 ............................................................................. 1.1777 0.9573 * * 25.1338 25.1338 

360260 ............................................................................. *** 0.8979 * * 27.3903 27.3903 

360261 ............................................................................. 1.7759 0.9482 * * 22.5431 22.5431 

360262 ............................................................................. 1.3387 0.9573 * * 27.1680 27.1680 

360263 ............................................................................. 1.6685 0.9263 * * 20.8884 20.8884 

370001 ............................................................................. 1.6782 0.8313 25.5838 26.2391 27.7549 26.5495 

370002 ............................................................................. 1.1821 0.7615 18.9544 19.7718 20.1479 19.6308 

370004 ............................................................................. 1.0932 0.8458 21.5041 24.7694 25.3919 23.7972 

370006 ............................................................................. 1.2069 0.7615 15.6333 16.9469 20.1063 17.6384 

370007 ............................................................................. 1.0399 0.7615 16.7598 17.2084 17.6547 17.2160 

370008 ............................................................................. 1.3885 0.9043 22.1596 22.7419 24.2978 23.1423 

370011 ............................................................................. 1.0810 0.9043 17.1458 19.2266 19.7821 18.6737 

370013 ............................................................................. 1.5187 0.9043 21.1512 22.6451 24.9295 22.9792 

370014 ............................................................................. 1.0403 0.8971 21.8473 24.8138 25.3576 24.0194 

370015 ............................................................................. 0.9737 0.8313 20.3966 21.1833 23.6693 21.7009 

370016 h ........................................................................... 1.4747 0.8682 20.4407 24.2737 25.4062 23.3330 

370018 ............................................................................. 1.4098 0.8313 20.8357 23.4286 23.5336 22.5984 

370019 ............................................................................. 1.2184 0.7615 18.1260 19.6761 21.4474 19.7475 

370020 ............................................................................. 1.2243 0.7615 16.8631 17.4835 18.5046 17.6368 

370022 ............................................................................. 1.1976 0.7673 20.2432 18.4217 19.6495 19.4375 

370023 ............................................................................. 1.2396 0.7615 19.3386 20.6002 21.5762 20.5441 

370025 ............................................................................. 1.2545 0.8313 20.2845 22.0287 23.5659 21.9757 

370026 h ........................................................................... 1.5077 0.8682 21.9140 22.5734 23.0848 22.5236 

370028 ............................................................................. 1.8453 0.9043 24.1009 24.8661 26.6153 25.1976 

370029 ............................................................................. 1.0293 0.7615 19.5811 22.1163 23.9956 21.8559 

370030 ............................................................................. 1.0428 0.7615 18.6541 20.3315 23.3037 20.7201 

370032 ............................................................................. 1.4479 0.9043 20.0827 21.6029 23.4843 21.7536 

370034 ............................................................................. 1.1924 0.7986 16.1540 17.6247 18.2341 17.3349 

370036 ............................................................................. 1.0216 0.7615 16.5844 16.9222 17.7576 17.1504 

370037 ............................................................................. 1.6563 0.9043 21.0719 23.1256 23.9685 22.7803 

370039 ............................................................................. 1.0902 0.8313 20.3137 21.0793 21.8220 21.0783 

370040 ............................................................................. 1.0053 0.8231 18.9981 21.1061 22.4048 20.8291 

370041 ............................................................................. 0.8812 0.8313 19.0144 22.0082 22.3496 21.1267 

370042 ............................................................................. 0.9473 0.7615 14.0899 15.3613 * 14.7180 

370043 ............................................................................. 0.9286 0.7615 20.2929 21.5588 * 20.9707 

370045 ............................................................................. 0.9116 0.7615 12.6613 14.6370 * 13.6711 

370047 ............................................................................. 1.4244 0.8971 19.4856 19.7112 20.4657 19.9082 

370048 ............................................................................. 1.0975 0.7615 15.4768 17.7273 19.2464 17.4431 

370049 ............................................................................. 1.2985 0.9043 20.4826 21.6878 23.2171 21.8100 

370051 ............................................................................. 1.0467 0.7615 12.0397 14.6254 17.2618 14.4702 

370054 ............................................................................. 1.2568 0.7615 20.3788 21.5521 21.5043 21.1653 

370056 ............................................................................. 1.6060 0.7916 20.4872 21.7647 22.0312 21.4507 

370057 ............................................................................. 0.9425 0.8313 17.3020 18.0426 19.7284 18.3749 

370060 ............................................................................. 0.9342 0.8313 23.1897 23.8007 18.7592 21.7395 

370064 ............................................................................. 0.8954 0.7615 11.9044 14.1879 14.2053 13.4809 

370065 ............................................................................. 1.0179 0.7615 18.3966 20.6537 20.0226 19.6691 

370072 ............................................................................. 0.7985 0.7615 12.5765 14.6387 9.9616 11.8723

370076 ............................................................................. *** * 19.0230 21.5461 * 20.2863 

370078 ............................................................................. 1.6061 0.8313 22.2318 23.9507 25.4161 23.9078 

370080 ............................................................................. 0.9012 0.7615 16.1444 17.4857 18.0665 17.2314 

370082 ............................................................................. *** 0.7615 12.6060 * * 12.6060 

370084 ............................................................................. 0.9685 0.7615 16.1278 17.2735 16.6514 16.7384 

370089 ............................................................................. 1.0714 0.7615 18.0505 19.9021 20.4699 19.4850 

370091 ............................................................................. 1.6980 0.8313 24.2117 22.9893 20.8950 22.6316 

370093 ............................................................................. 1.6152 0.9043 23.5685 25.7296 26.9774 25.3740 

370094 ............................................................................. 1.3966 0.9043 20.6507 22.0591 23.1191 21.9907 

23526 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

TABLE 2.—HOSPITAL CASE-MIX INDEXES FOR DISCHARGES OCCURRING IN FEDERAL FISCAL YEAR 2004; HOSPITAL AVERAGE HOURLY WAGE FOR FEDERAL FISCAL YEARS 2004 (2000 WAGE DATA), 2005 (2001 WAGE DATA), AND 2006 

(2002 WAGE DATA) WAGE INDEXES AND 3-YEAR AVERAGE OF HOSPITAL AVERAGE HOURLY WAGES—Continued 

Provider number Case-mix 

index 

Wage index 

FY 2006 

Average 

hourly wage 

FY 2004 

Average 

hourly wage 

FY 2005 

Average 

hourly wage 

FY 2006 

Average 

hourly 

wage ** 

(3 years) 

370095 ............................................................................. 0.8800 0.7615 14.3563 16.5310 * 15.4277 

370097 ............................................................................. 1.2850 0.7916 20.3218 21.7150 22.3267 21.5064 

370099 ............................................................................. 1.0065 0.8313 20.2001 20.5217 20.5075 20.4227 

370100 ............................................................................. 0.9736 0.7615 13.0681 14.1883 14.7712 14.0181 

370103 ............................................................................. 0.9494 0.8038 15.6110 16.1408 17.8018 16.5505 

370105 ............................................................................. 1.8469 0.9043 22.4493 22.1584 23.8978 22.8583 

370106 ............................................................................. 1.3329 0.9043 24.1115 24.2393 26.5867 25.0105 

370108 ............................................................................. *** 0.7615 13.8170 * * 13.8170 

370113 ............................................................................. 1.1317 0.8615 21.4267 23.3011 25.3565 23.3322 

370114 ............................................................................. 1.5494 0.8313 19.4933 21.0603 21.7880 20.8230 

370123 ............................................................................. *** 0.9043 20.5180 22.8174 25.4733 22.7986 

370125 ............................................................................. 0.8500 0.7615 17.9240 17.2013 17.1361 17.4038 

370138 ............................................................................. 1.0187 0.7615 19.0403 19.8308 18.3113 19.0435 

370139 ............................................................................. 0.9394 0.7615 16.3224 17.8900 18.5225 17.5400 

370141 ............................................................................. *** * 24.7859 * * 24.7859 

370149 h ........................................................................... 1.2033 0.9043 18.2260 21.0608 22.3537 20.7832 

370153 ............................................................................. 1.0423 0.7615 17.9692 18.5417 19.8349 18.7951 

370154 ............................................................................. *** 0.7615 17.4760 * * 17.4760 

370158 ............................................................................. 1.0192 0.9043 17.3412 17.3161 18.5578 17.7592 

370166 ............................................................................. 0.9772 0.8313 21.3628 21.9070 23.1681 22.1327 

370169 ............................................................................. 0.8969 0.7615 16.5607 15.7686 15.8002 16.0704 

370176 ............................................................................. 1.1057 0.8313 22.1456 23.0324 25.0509 23.4362 

370177 ............................................................................. 1.0170 0.7615 14.0279 15.6723 14.7193 14.7923 

370178 ............................................................................. 0.8922 0.7615 12.9635 14.9767 14.6070 14.1857 

370179 ............................................................................. 0.9231 0.8313 21.9673 22.8322 23.5794 22.6918 

370183 ............................................................................. 1.0143 0.8313 17.9270 20.5025 21.8147 20.0076 

370186 ............................................................................. 0.9064 0.7615 16.3879 * * 16.3879 

370192 ............................................................................. 1.7741 0.9043 24.3832 26.1338 31.4930 27.6466 

370196 ............................................................................. 1.0758 0.9043 23.6334 29.4383 22.6824 25.4359 

370199 ............................................................................. 0.9440 0.9043 20.7075 23.7340 26.0451 23.4652 

370200 ............................................................................. 1.1666 0.7615 16.7164 18.1008 17.6317 17.5059 

370201 ............................................................................. 1.7335 0.9043 18.9906 23.1240 23.3550 21.7730 

370202 ............................................................................. 1.5326 0.8313 24.0239 24.4920 25.1181 24.5965 

370203 ............................................................................. 1.3678 0.9043 19.8772 21.2426 23.5190 21.5182 

370206 ............................................................................. 1.6351 0.9043 22.3471 27.4495 26.0912 25.5795 

370207 ............................................................................. *** * 26.3746 * * 26.3746 

370210 ............................................................................. 2.0839 0.8313 * 20.0360 21.2682 20.6946 

370211 ............................................................................. 0.9454 0.9043 * * 26.5344 26.5344 

370212 ............................................................................. 1.5402 0.9043 * * 21.0758 21.0758 

370213 ............................................................................. *** 0.9043 * * 29.3777 29.3777 

370215 ............................................................................. 2.4364 0.9043 * * 32.3589 32.3589 

380001 ............................................................................. 1.1877 1.1229 20.9585 27.8554 29.7467 26.1275 

380002 ............................................................................. 1.1956 1.0284 25.2629 26.3348 27.1861 26.3148 

380003 ............................................................................. *** 1.0284 24.6377 * * 24.6377 

380005 ............................................................................. 1.3582 1.0284 26.3472 28.0682 30.2211 28.3075 

380006 ............................................................................. 1.1408 1.0284 24.7492 26.0475 * 25.3948 

380007 ............................................................................. 1.9556 1.1229 30.0497 31.5207 33.9969 31.9322 

380008 ............................................................................. 1.1289 1.0328 24.6149 25.4494 25.8356 25.3227 

380009 ............................................................................. 1.8990 1.1229 26.0012 30.4198 31.7042 29.4616 

380010 ............................................................................. 0.9763 1.1229 25.5234 27.5291 30.2957 27.8451 

380011 ............................................................................. *** 1.0284 21.9382 * * 21.9382 

380014 ............................................................................. 1.8048 1.0711 28.4536 27.7255 29.9648 28.7806 

380017 ............................................................................. 1.7793 1.1229 29.2543 31.7440 32.2447 31.1318 

380018 ............................................................................. 1.7996 1.0284 27.5171 27.8952 28.0701 27.8359 

380020 ............................................................................. 1.3856 1.0810 23.7066 25.8320 28.3563 26.0268 

380021 ............................................................................. 1.4351 1.1229 28.0334 29.3001 29.3295 28.9428 

380022 ............................................................................. 1.2181 1.0328 26.4794 27.8683 29.2642 27.9316 

380023 ............................................................................. 1.1682 1.0284 23.0079 23.7073 26.5439 24.4358 

380025 ............................................................................. 1.2837 1.1229 28.8525 30.2628 33.2105 30.8181 

380026 ............................................................................. 1.1324 1.0284 23.8666 26.5217 * 25.2072 

380027 ............................................................................. 1.2867 1.0492 21.5822 23.8758 25.5161 23.7359 

380029 ............................................................................. 1.2971 1.0445 24.2939 26.2070 26.9966 25.9075 

380033 ............................................................................. 1.6592 1.0810 30.4783 29.7995 30.8767 30.3883 

380035 ............................................................................. 1.0421 1.0284 26.2434 26.4784 * 26.3599 

380037 ............................................................................. 1.2266 1.1229 25.0200 27.1884 30.5818 27.7342 

380038 ............................................................................. 1.2591 1.1229 29.1804 30.5903 34.2303 31.3814 

380039 ............................................................................. 0.9755 1.1229 27.5115 30.1544 32.3959 30.0601 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23527 

TABLE 2.—HOSPITAL CASE-MIX INDEXES FOR DISCHARGES OCCURRING IN FEDERAL FISCAL YEAR 2004; HOSPITAL AVERAGE HOURLY WAGE FOR FEDERAL FISCAL YEARS 2004 (2000 WAGE DATA), 2005 (2001 WAGE DATA), AND 2006 

(2002 WAGE DATA) WAGE INDEXES AND 3-YEAR AVERAGE OF HOSPITAL AVERAGE HOURLY WAGES—Continued 

Provider number Case-mix 

index 

Wage index 

FY 2006 

Average 

hourly wage 

FY 2004 

Average 

hourly wage 

FY 2005 

Average 

hourly wage 

FY 2006 

Average 

hourly 

wage ** 

(3 years) 

380040 ............................................................................. 1.1950 1.0284 21.5958 28.4373 32.0103 27.1504 

380047 ............................................................................. 1.8037 1.0492 26.5017 27.8385 29.8627 28.1638 

380050 ............................................................................. 1.3931 1.0284 23.1332 24.2416 25.6190 24.3627 

380051 ............................................................................. 1.5718 1.0445 26.2384 28.1305 29.7219 28.0410 

380052 ............................................................................. 1.1643 1.0284 21.2567 22.6799 24.9476 22.9567 

380056 ............................................................................. 0.9458 1.0445 22.3571 25.0068 25.1475 24.2275 

380060 ............................................................................. 1.4020 1.1229 27.8551 30.2507 29.5370 29.2476 

380061 ............................................................................. 1.6536 1.1229 27.3827 29.5145 29.8217 28.9273 

380066 ............................................................................. 1.2243 1.0284 23.3581 27.5412 * 25.5211 

380070 ............................................................................. 1.1747 1.1229 34.1039 * * 34.1039 

380072 ............................................................................. 0.8417 1.0284 21.9516 22.5275 * 22.2419 

380075 ............................................................................. 1.3046 1.0284 25.1930 27.4795 29.0368 27.3082 

380081 ............................................................................. 1.1379 1.0284 22.1822 21.0708 21.8850 21.7195 

380082 ............................................................................. 1.2215 1.1229 28.0668 30.2721 32.4909 30.3569 

380089 ............................................................................. 1.2717 1.1229 29.6989 30.8396 33.4214 31.3234 

380090 ............................................................................. 1.2689 1.0284 31.8702 33.6822 34.4536 33.3615 

380091 ............................................................................. 1.2950 1.1229 31.2807 35.7002 33.8950 33.5968 

390001 ............................................................................. 1.6397 0.8530 21.5154 22.4407 22.5309 22.1581 

390002 ............................................................................. 1.2571 0.8840 22.0646 23.0113 22.4388 22.5092 

390003 h ........................................................................... 1.1657 0.8530 19.1857 21.3182 21.6478 20.7084 

390004 ............................................................................. 1.5540 0.9317 21.3475 23.4063 24.3249 23.1020 

390005 ............................................................................. 0.9829 0.8746 19.0727 19.0318 * 19.0497 

390006 ............................................................................. 1.8357 0.9145 23.0378 23.3960 25.1216 23.8687 

390008 h ........................................................................... 1.1582 0.8840 19.9417 21.0021 22.2680 21.0752 

390009 ............................................................................. 1.7277 0.8746 21.9459 24.2789 25.5482 23.9471 

390010 ............................................................................. 1.2001 0.8840 19.4377 21.6273 23.5390 21.5537 

390011 ............................................................................. 1.3112 0.8348 18.6548 19.8602 21.9279 20.1129 

390012 ............................................................................. 1.2176 1.1030 28.5114 * 28.5076 28.5093 

390013 ............................................................................. 1.2121 0.9145 22.1679 23.3180 24.0044 23.1713 

390016 h ........................................................................... 1.1998 0.8446 18.1536 19.9899 21.9549 20.1569 

390017 h ........................................................................... *** 0.8840 19.1962 20.6575 * 19.8788 

390018 ............................................................................. *** * 19.9117 * * 19.9117 

390022 ............................................................................. 1.3090 1.1030 27.5504 31.0971 29.0710 29.1659 

390023 ............................................................................. 1.2577 1.1030 25.3767 27.1600 31.7149 28.1614 

390024 ............................................................................. 1.0501 1.1030 25.9806 37.4330 35.3959 29.4333 

390025 ............................................................................. 0.5266 1.1030 14.8690 15.0282 17.2977 15.7085 

390026 ............................................................................. 1.2353 1.1030 24.0326 27.0802 29.5157 26.9256 

390027 ............................................................................. 1.5482 1.1030 33.2139 28.9159 35.6568 32.4911 

390028 ............................................................................. 1.5912 0.8840 24.6796 23.6616 25.7246 24.7268 

390029 ............................................................................. *** * * 24.4276 * 24.4276 

390030 ............................................................................. 1.1837 0.9844 20.0598 20.9859 22.1581 21.0867 

390031 ............................................................................. 1.2104 0.9500 20.3568 21.2949 22.6828 21.4388 

390032 ............................................................................. 1.1735 0.8840 20.8450 20.9971 22.7205 21.5225 

390035 ............................................................................. 1.2222 1.1030 23.2173 24.7281 26.2647 24.7742 

390036 ............................................................................. 1.4446 0.8840 20.5751 23.3858 24.6032 22.8336 

390037 ............................................................................. 1.3365 0.8840 20.1665 22.9008 24.7820 22.6385 

390039 h ........................................................................... 1.1565 0.8348 18.4580 17.8461 20.3787 18.9083 

390040 ............................................................................. *** * 20.5371 23.1807 * 21.7860 

390041 ............................................................................. 1.3009 0.8840 21.0074 20.6789 21.5925 21.0799 

390042 ............................................................................. 1.3204 0.8840 22.2351 23.9632 25.6328 23.9486 

390043 ............................................................................. 1.1602 0.8300 19.8641 20.9835 22.2549 21.0509 

390044 ............................................................................. 1.6591 0.9698 22.4235 24.2586 27.1505 24.6634 

390045 ............................................................................. 1.5712 0.8368 20.2082 22.2582 23.0877 21.8830 

390046 ............................................................................. 1.5379 0.9422 23.1271 25.0825 27.6367 25.3031 

390048 ............................................................................. 1.0828 0.9145 20.3523 23.6622 24.7738 22.8564 

390049 ............................................................................. 1.5860 0.9844 24.0933 25.4056 27.1366 25.5929 

390050 ............................................................................. 2.0343 0.8840 22.6951 24.5424 26.6931 24.6339 

390052 ............................................................................. 1.1848 0.8942 22.1380 21.6736 23.6105 22.4994 

390054 ............................................................................. 1.1909 0.8530 19.8602 21.4983 22.8087 21.3801 

390055 ............................................................................. *** 0.8840 23.5292 25.5675 25.6945 24.9860 

390056 ............................................................................. 1.0653 0.8300 21.4239 * 19.5537 20.4834 

390057 ............................................................................. 1.3195 1.1030 24.8235 25.1901 27.9583 26.0368 

390058 ............................................................................. 1.2715 0.9317 22.0113 25.3415 27.4799 24.8349 

390061 ............................................................................. 1.5355 0.9716 24.4550 25.5012 28.4538 26.1704 

390062 ............................................................................. 1.1167 0.8942 17.6303 19.0692 21.4052 19.4592 

390063 ............................................................................. 1.7404 0.8746 21.7120 23.5469 24.7614 23.4097 

390065 ............................................................................. 1.2046 1.0813 23.1384 23.4021 25.9184 24.2223 

23528 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

TABLE 2.—HOSPITAL CASE-MIX INDEXES FOR DISCHARGES OCCURRING IN FEDERAL FISCAL YEAR 2004; HOSPITAL AVERAGE HOURLY WAGE FOR FEDERAL FISCAL YEARS 2004 (2000 WAGE DATA), 2005 (2001 WAGE DATA), AND 2006 

(2002 WAGE DATA) WAGE INDEXES AND 3-YEAR AVERAGE OF HOSPITAL AVERAGE HOURLY WAGES—Continued 

Provider number Case-mix 

index 

Wage index 

FY 2006 

Average 

hourly wage 

FY 2004 

Average 

hourly wage 

FY 2005 

Average 

hourly wage 

FY 2006 

Average 

hourly 

wage ** 

(3 years) 

390066 ............................................................................. 1.2713 0.9145 21.7717 23.0891 24.2087 23.0471 

390067 ............................................................................. 1.8233 0.9317 23.5136 25.4576 26.3287 25.0668 

390068 ............................................................................. 1.3022 0.9716 21.1177 25.9890 25.8291 24.3019 

390070 ............................................................................. 1.3629 1.1030 24.4403 26.9235 30.9499 27.4435 

390071 ............................................................................. 0.9895 0.8300 17.8117 20.9443 20.6652 19.7095 

390072 h ........................................................................... 1.0397 0.8530 20.0561 22.0155 24.9388 22.3043 

390073 ............................................................................. 1.5559 0.8942 22.7073 24.8013 26.3698 24.6228 

390074 ............................................................................. 1.1407 0.8840 21.8456 21.0941 22.8545 21.9412 

390075 ............................................................................. *** * 19.9775 22.6530 24.6359 22.3701 

390076 ............................................................................. 1.3409 1.1030 21.2039 18.1276 27.9004 21.9007 

390079 ............................................................................. 1.8970 0.8471 19.9169 21.4323 23.3053 21.5091 

390080 ............................................................................. 1.2828 1.1030 23.3742 25.0921 27.2616 25.2851 

390081 ............................................................................. 1.2236 1.0652 28.1056 28.7974 30.3840 29.1503 

390084 ............................................................................. 1.2243 0.8300 18.3551 20.7799 19.8605 19.6630 

390086 ............................................................................. 1.5445 0.8300 19.6488 20.7383 22.5317 20.9944 

390090 ............................................................................. 1.7972 0.8840 22.4688 20.7474 25.2014 22.8601 

390091 ............................................................................. 1.1421 0.8446 19.7361 20.8243 21.5586 20.7010 

390093 ............................................................................. 1.1685 0.8446 19.9209 21.0427 21.4401 20.8186 

390095 ............................................................................. 1.1908 0.8530 18.3939 21.0754 23.6240 20.9725 

390096 ............................................................................. 1.4974 0.9698 22.9502 24.4145 27.0763 24.8874 

390097 ............................................................................. 1.1901 1.1030 24.5304 25.3012 25.6660 25.2008 

390100 ............................................................................. 1.6968 0.9716 23.4155 26.7267 27.7208 26.0717 

390101 ............................................................................. 1.2400 0.9422 20.1271 20.1694 21.2641 20.5324 

390102 ............................................................................. 1.3469 0.8840 20.9807 21.6629 24.8898 22.6239 

390103 ............................................................................. 1.0080 0.8840 21.0637 18.6703 20.6775 20.1561 

390104 ............................................................................. 1.0501 0.8300 16.5081 19.1803 19.6428 18.4897 

390107 ............................................................................. 1.3679 0.8840 21.5852 23.1023 24.1386 23.0080 

390108 ............................................................................. 1.2171 1.1030 23.7842 24.7486 27.2661 25.2833 

390109 ............................................................................. 1.1229 0.8530 17.2667 18.7558 19.9156 18.6551 

390110 ............................................................................. 1.5720 0.8840 22.3968 23.3355 23.9808 23.2737 

390111 ............................................................................. 2.0139 1.1030 30.5814 30.6809 32.6510 31.3439 

390112 h ........................................................................... 1.1736 0.8348 15.6710 16.6113 19.2126 17.1537 

390113 ............................................................................. 1.2850 0.8446 20.1160 21.7729 22.2591 21.3940 

390114 ............................................................................. 1.3024 0.8840 23.6162 22.6630 24.0473 23.4341 

390115 ............................................................................. 1.4409 1.1030 24.1951 26.4751 27.7333 26.1536 

390116 ............................................................................. 1.2529 1.1030 24.9581 28.5563 29.7436 27.8303 

390117 ............................................................................. 1.0952 0.8300 19.0983 20.0040 20.3946 19.8418 

390118 ............................................................................. 1.1665 0.8300 17.8460 19.3332 21.5001 19.5328 

390119 ............................................................................. 1.2920 0.8530 20.3034 21.2761 22.2746 21.3271 

390121 ............................................................................. 1.6614 0.8942 20.8017 22.0556 23.1408 22.0024 

390122 ............................................................................. 1.0973 0.8300 18.5130 21.6981 22.5785 20.8388 

390123 ............................................................................. 1.1985 1.1030 23.2232 25.2209 28.6269 25.7365 

390125 ............................................................................. 1.2705 0.8300 18.2411 19.4406 20.9456 19.5654 

390127 ............................................................................. 1.3061 1.1030 25.0836 28.9238 30.9374 28.4999 

390128 ............................................................................. 1.1865 0.8840 21.3668 21.8837 23.0255 22.1158 

390130 ............................................................................. 1.2623 0.8348 19.4835 21.0694 24.0685 21.4556 

390131 ............................................................................. 1.2940 0.8840 19.5296 21.2164 22.5177 21.1193 

390132 ............................................................................. 1.3983 1.1030 24.6889 26.8153 27.7250 26.4427 

390133 ............................................................................. 1.6988 1.1030 25.2110 26.1458 28.7162 26.7622 

390135 ............................................................................. *** 1.1030 24.0445 * 24.4738 24.2670 

390136 ............................................................................. 1.0748 0.8840 21.9531 24.8042 22.1415 22.9715 

390137 ............................................................................. 1.4810 0.8530 19.5457 21.8830 23.4877 21.5609 

390138 ............................................................................. 1.1787 1.0813 21.4705 22.7210 24.2769 22.8713 

390139 ............................................................................. 1.3178 1.1030 26.3622 28.2089 30.4246 28.3708 

390142 ............................................................................. 1.4621 1.1030 29.8874 32.0827 32.3517 31.4330 

390145 ............................................................................. 1.4545 0.8840 20.6580 22.4255 23.8041 22.3138 

390146 ............................................................................. 1.2491 0.8300 21.4580 22.3260 25.2460 23.0540 

390147 ............................................................................. 1.2294 0.8840 22.3135 23.6380 25.0971 23.6939 

390150 ............................................................................. 1.1557 0.8840 20.0261 24.5256 24.1855 22.9524 

390151 ............................................................................. 1.2703 1.0813 24.7843 25.1422 27.1539 25.7127 

390152 ............................................................................. 0.9999 0.8942 21.5474 11.7774 * 15.1275 

390153 ............................................................................. 1.3749 1.1030 25.3391 27.5167 30.0586 27.7812 

390154 ............................................................................. 1.2331 0.8300 19.1300 20.4408 20.6982 20.0794 

390156 ............................................................................. 1.3484 1.0652 25.0801 27.8096 31.2571 28.0054 

390157 ............................................................................. 1.2887 0.8840 20.6933 22.0222 22.7493 21.8431 

390160 ............................................................................. 1.1601 0.8840 19.3598 19.5942 21.4877 20.1709 

390162 ............................................................................. 1.4642 0.9844 24.0291 * 30.0900 26.8901 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23529 

TABLE 2.—HOSPITAL CASE-MIX INDEXES FOR DISCHARGES OCCURRING IN FEDERAL FISCAL YEAR 2004; HOSPITAL AVERAGE HOURLY WAGE FOR FEDERAL FISCAL YEARS 2004 (2000 WAGE DATA), 2005 (2001 WAGE DATA), AND 2006 

(2002 WAGE DATA) WAGE INDEXES AND 3-YEAR AVERAGE OF HOSPITAL AVERAGE HOURLY WAGES—Continued 

Provider number Case-mix 

index 

Wage index 

FY 2006 

Average 

hourly wage 

FY 2004 

Average 

hourly wage 

FY 2005 

Average 

hourly wage 

FY 2006 

Average 

hourly 

wage ** 

(3 years) 

390163 ............................................................................. 1.2667 0.8840 18.8585 19.8863 22.1741 20.2736 

390164 ............................................................................. 2.0562 0.8840 24.2334 25.1277 26.4971 25.3882 

390166 ............................................................................. 1.1534 0.8840 19.8531 20.9510 24.9810 21.8402 

390168 ............................................................................. 1.4369 0.8840 20.6777 21.9344 24.5820 22.5085 

390169 ............................................................................. 1.4033 0.8530 22.7695 24.1682 27.2242 24.7030 

390173 ............................................................................. 1.1624 0.8300 20.6958 21.6562 22.8220 21.7639 

390174 ............................................................................. 1.7303 1.1030 28.4490 30.3725 32.6265 30.5109 

390176 ............................................................................. 1.1510 0.8840 18.0752 17.1387 * 17.5532 

390178 ............................................................................. 1.2958 0.8609 17.2384 19.2731 20.7270 19.1018 

390179 ............................................................................. 1.3648 1.1030 24.0501 24.8350 27.2222 25.3975 

390180 ............................................................................. 1.4462 1.0652 28.4842 30.4264 32.4375 30.5043 

390181 ............................................................................. 1.0361 0.8300 * 25.7357 24.4573 25.1039 

390183 ............................................................................. 1.0850 0.8300 21.6811 22.0117 25.6554 23.0449 

390184 ............................................................................. 1.0849 0.8840 21.1962 21.3407 22.5519 21.7060 

390185 ............................................................................. 1.2694 0.8530 20.4476 21.8871 23.0202 21.7597 

390189 ............................................................................. 1.1071 0.8300 20.1365 21.2711 22.3722 21.3477 

390191 ............................................................................. 1.0835 0.8300 18.5972 19.2308 20.8761 19.5306 

390192 ............................................................................. 1.0157 0.8530 19.1883 20.0395 21.2620 20.1833 

390193 ............................................................................. *** 0.8746 18.9764 18.5516 20.1024 19.2196 

390194 ............................................................................. 1.1011 0.9844 21.5850 23.1814 25.4235 23.4479 

390195 ............................................................................. 1.6321 1.1030 26.2024 28.3480 31.0019 28.5392 

390197 ............................................................................. 1.3925 0.9844 22.8349 24.9234 25.7739 24.4854 

390198 ............................................................................. 1.1641 0.8746 17.3937 16.8529 18.7222 17.6295 

390199 ............................................................................. 1.2174 0.8300 18.9787 19.9653 21.3157 20.1079 

390200 ............................................................................. *** 0.9716 19.4471 23.1486 23.7471 21.9484 

390201 ............................................................................. 1.2961 0.8300 22.7849 24.8222 26.3658 24.6735 

390203 ............................................................................. 1.6357 1.1030 26.9436 28.2741 28.9054 28.0870 

390204 ............................................................................. 1.2498 1.1030 23.9673 25.6342 28.6829 26.1129 

390211 ............................................................................. 1.2717 0.8609 21.0450 22.4472 23.1450 22.2313 

390215 ............................................................................. *** * 25.2617 26.4180 28.0402 26.4046 

390217 ............................................................................. 1.1533 0.8840 21.4058 21.3281 24.3610 22.3261 

390219 ............................................................................. 1.2908 0.8840 20.0594 22.8559 25.1705 22.7113 

390220 ............................................................................. 1.0977 1.1030 23.4385 24.7553 41.6138 28.9098 

390222 ............................................................................. 1.2483 1.0652 24.9345 27.0954 28.7488 26.9594 

390223 ............................................................................. 1.9554 1.1030 22.8725 28.2538 27.6407 26.2383 

390224 ............................................................................. 0.8462 0.8471 16.1289 18.1226 18.7624 17.7120 

390225 ............................................................................. 1.1871 0.9716 20.9232 23.4945 24.9391 23.3545 

390226 ............................................................................. 1.7312 1.1030 25.6917 27.0061 28.5890 27.1866 

390228 ............................................................................. 1.3206 0.8840 21.0164 22.5999 23.3078 22.3536 

390231 ............................................................................. 1.4382 1.1030 24.7757 27.0576 29.2653 27.1070 

390233 ............................................................................. 1.3700 0.9422 21.8043 22.8667 24.8690 23.1907 

390235 ............................................................................. *** * 23.7068 * * 23.7068 

390237 ............................................................................. 1.5540 0.8530 23.2054 24.6316 26.9533 24.9348 

390238 ............................................................................. *** * 19.2171 26.4748 * 22.5836 

390246 ............................................................................. 1.1671 0.8300 22.0687 23.3275 20.1581 21.8667 

390249 ............................................................................. 0.8767 0.8471 14.7215 * * 14.7215 

390258 ............................................................................. 1.5307 1.1030 25.0634 27.2038 29.4626 27.3466 

390262 ............................................................................. *** * 21.3264 * * 21.3264 

390265 ............................................................................. 1.4456 0.8840 20.5948 21.6751 23.4836 21.9520 

390266 ............................................................................. 1.1763 0.8609 18.2424 19.2836 20.3918 19.3171 

390267 ............................................................................. 1.1835 0.8840 21.4801 22.5464 23.1051 22.3821 

390268 ............................................................................. 1.3066 0.8368 23.1124 24.2050 25.0021 24.1351 

390270 ............................................................................. 1.4615 0.8530 22.5258 24.0837 24.1496 23.6565 

390278 ............................................................................. 0.5214 1.1030 21.1387 21.6893 23.6843 22.1694 

390279 ............................................................................. 1.1519 0.8368 16.0510 15.3569 17.0012 16.1304 

390285 ............................................................................. 1.5472 1.1030 30.6300 33.5347 35.0427 33.0866 

390286 ............................................................................. 1.1613 1.1030 25.4499 27.4090 28.1761 27.0003 

390287 ............................................................................. 1.4298 1.1030 32.9709 35.7147 37.6569 35.5140 

390288 ............................................................................. *** 1.1030 28.0957 28.5267 29.7287 28.6956 

390289 ............................................................................. 1.0920 1.1030 25.1658 28.4577 28.8826 27.4320 

390290 ............................................................................. 1.9082 1.1030 31.0967 36.4991 37.9040 35.0787 

390291 ............................................................................. *** 0.8840 21.0057 21.3015 * 21.1542 

390294 ............................................................................. *** * 33.3537 * * 33.3537 

390296 ............................................................................. *** * 25.6981 * * 25.6981 

390298 ............................................................................. *** * * 26.8290 * 26.8290 

390299 ............................................................................. *** * * 31.9423 * 31.9423 

390300 ............................................................................. *** * * 40.4697 * 40.4697 

23530 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

TABLE 2.—HOSPITAL CASE-MIX INDEXES FOR DISCHARGES OCCURRING IN FEDERAL FISCAL YEAR 2004; HOSPITAL AVERAGE HOURLY WAGE FOR FEDERAL FISCAL YEARS 2004 (2000 WAGE DATA), 2005 (2001 WAGE DATA), AND 2006 

(2002 WAGE DATA) WAGE INDEXES AND 3-YEAR AVERAGE OF HOSPITAL AVERAGE HOURLY WAGES—Continued 

Provider number Case-mix 

index 

Wage index 

FY 2006 

Average 

hourly wage 

FY 2004 

Average 

hourly wage 

FY 2005 

Average 

hourly wage 

FY 2006 

Average 

hourly 

wage ** 

(3 years) 

390301 ............................................................................. *** 0.8530 * * 30.9838 30.9838 

400001 ............................................................................. 1.2643 0.4686 11.7572 16.1114 13.1847 13.4859 

400002 ............................................................................. 1.7313 0.5178 11.6804 14.8607 16.7583 14.1458 

400003 ............................................................................. 1.3456 0.5178 10.5963 13.0776 13.6751 12.3819 

400004 ............................................................................. 1.1394 0.4686 11.4041 10.4716 14.3108 11.8780 

400005 ............................................................................. 1.1205 0.4686 10.5356 10.2878 10.7207 10.5186 

400006 ............................................................................. 1.1887 0.4686 9.2852 8.9919 9.2265 9.1710 

400007 ............................................................................. 1.1804 0.4686 8.6022 8.7152 9.2463 8.8511 

400009 ............................................................................. 1.0804 0.3186 9.4413 9.2007 9.3116 9.3159 

400010 ............................................................................. 0.8250 0.4736 9.2799 10.9354 10.0962 10.0495

400011 ............................................................................. 1.0865 0.4686 8.9111 8.5868 8.5534 8.6726 

400012 ............................................................................. 1.3545 0.4686 9.0740 8.3580 8.3802 8.5938 

400013 ............................................................................. 1.2691 0.4686 9.9905 9.5584 10.3347 9.9727 

400014 ............................................................................. 1.3193 0.4016 11.4580 11.7023 12.5363 11.8896 

400015 ............................................................................. 1.3649 0.4686 * 15.6066 17.4086 16.6535 

400016 ............................................................................. 1.3515 0.4686 14.6491 15.3497 14.7607 14.9193 

400017 ............................................................................. 1.1959 0.4686 10.7475 10.1238 10.2734 10.3916 

400018 ............................................................................. 1.1949 0.4686 10.8254 10.7948 11.6165 11.0939 

400019 ............................................................................. 1.3212 0.4686 13.7007 14.9892 13.7754 14.1263 

400021 ............................................................................. 1.3102 0.4646 13.5224 13.8643 14.1533 13.8469 

400022 ............................................................................. 1.3444 0.5178 15.2904 16.0539 16.8806 16.0784 

400024 ............................................................................. 0.8372 0.4016 9.8650 9.1316 12.4649 10.2156 

400026 ............................................................................. 1.0673 0.3186 5.9206 5.2085 5.8200 5.6501 

400028 ............................................................................. 1.2057 0.5178 9.5266 10.3354 10.9808 10.2872

400032 ............................................................................. 1.1946 0.4686 10.7100 10.7195 10.2652 10.5650 

400044 ............................................................................. 1.2777 0.5178 9.0275 10.7890 13.7509 11.4819

400048 ............................................................................. 1.0975 0.4686 10.8618 14.0887 10.4266 11.8488 

400061 ............................................................................. 1.7250 0.4686 16.5895 15.1639 20.3206 17.3616 

400079 ............................................................................. 1.1310 0.4736 8.7218 9.4218 12.7825 10.1505 

400087 ............................................................................. 1.1988 0.4686 10.7118 9.5860 10.6849 10.3421

400094 ............................................................................. *** * 9.2871 8.8646 * 9.1244 

400098 ............................................................................. 1.5719 0.4686 13.8036 13.7938 12.8230 13.4850 

400102 ............................................................................. 1.1198 0.4686 10.9973 10.1795 10.2677 10.4779 

400103 ............................................................................. 1.7425 0.4016 11.5797 12.8288 9.3859 10.9876

400104 ............................................................................. 1.1364 0.4686 7.1781 8.2758 8.3900 7.8760 

400105 ............................................................................. 1.1274 0.4686 11.5608 12.7725 14.5339 12.8828 

400106 ............................................................................. 1.1815 0.4686 10.1241 9.6902 11.4507 10.3951

400109 ............................................................................. 1.4714 0.4686 12.8921 14.2169 14.2111 13.7444 

400110 ............................................................................. 1.0965 0.4413 12.0159 11.8458 12.3449 12.0750 

400111 ............................................................................. 1.0774 0.4736 12.7701 13.4777 14.5029 13.5496 

400112 ............................................................................. 1.1915 0.4686 12.2859 8.9469 19.3945 12.3541

400113 ............................................................................. 1.2040 0.5178 10.4416 10.0830 11.0072 10.4939 

400114 ............................................................................. 1.0880 0.4686 9.7444 12.1920 11.5478 11.0784

400115 ............................................................................. 1.1179 0.4686 7.0411 9.1132 13.7392 9.2213 

400117 ............................................................................. 1.1002 0.4686 9.7314 10.2911 12.7600 10.8102

400118 ............................................................................. 1.2310 0.4686 12.4590 11.9324 12.5743 12.3218 

400120 ............................................................................. 1.2997 0.4686 11.8837 11.9714 12.7955 12.2196 

400121 ............................................................................. 1.0671 0.4686 8.3575 8.6665 8.2197 8.4118 

400122 ............................................................................. 1.9548 0.4686 9.6644 9.6463 8.3069 9.4955 

400123 ............................................................................. 1.1994 0.4016 10.5643 11.8135 11.9825 11.4619 

400124 ............................................................................. 2.8727 0.4686 14.3496 17.2258 16.1812 15.8787 

400125 ............................................................................. 1.1319 0.4160 10.6642 10.7425 11.6386 11.0069 

400126 ............................................................................. 1.2093 0.4646 * 13.3932 9.8008 11.0632 

410001 ............................................................................. 1.3081 1.1233 24.0033 27.0309 28.0816 26.3767 

410004 ............................................................................. 1.2319 1.1233 23.6409 25.4578 27.4209 25.5908 

410005 ............................................................................. 1.2822 1.1233 24.6522 27.1171 30.1606 27.3044 

410006 ............................................................................. 1.2503 1.1233 26.1372 27.1842 29.4395 27.6190 

410007 ............................................................................. 1.7094 1.1233 27.7171 30.1360 31.8548 30.0135 

410008 ............................................................................. 1.2098 1.1233 25.4183 28.4245 29.6092 27.8277 

410009 ............................................................................. 1.2932 1.1233 26.9135 27.7337 29.4094 28.0697 

410010 ............................................................................. 1.1636 1.0952 30.3860 30.7826 32.8599 31.3979 

410011 ............................................................................. 1.2966 1.1233 29.7664 28.5875 29.9001 29.4052 

410012 ............................................................................. 1.7532 1.1233 28.1791 32.1679 32.6009 31.1120 

410013 ............................................................................. 1.2276 1.1233 28.9386 31.7482 35.4624 32.1157 

420002 ............................................................................. 1.5184 0.9717 25.1067 27.9312 28.2848 27.1910 

420004 ............................................................................. 1.9550 0.9433 23.4579 26.0279 28.4845 26.0443 

420005 ............................................................................. 1.0179 0.8663 19.5521 19.8167 23.1943 20.8182 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23531 

TABLE 2.—HOSPITAL CASE-MIX INDEXES FOR DISCHARGES OCCURRING IN FEDERAL FISCAL YEAR 2004; HOSPITAL AVERAGE HOURLY WAGE FOR FEDERAL FISCAL YEARS 2004 (2000 WAGE DATA), 2005 (2001 WAGE DATA), AND 2006 

(2002 WAGE DATA) WAGE INDEXES AND 3-YEAR AVERAGE OF HOSPITAL AVERAGE HOURLY WAGES—Continued 

Provider number Case-mix 

index 

Wage index 

FY 2006 

Average 

hourly wage 

FY 2004 

Average 

hourly wage 

FY 2005 

Average 

hourly wage 

FY 2006 

Average 

hourly 

wage ** 

(3 years) 

420006 ............................................................................. 1.0874 0.9433 22.7896 22.8920 24.0811 23.2220 

420007 ............................................................................. 1.5636 0.9183 22.0228 25.0395 25.2650 24.2318 

420009 ............................................................................. 1.3786 0.9807 18.6866 23.8668 25.5079 22.5621 

420010 ............................................................................. 1.1844 0.8988 19.1746 21.6478 23.4562 21.5057 

420011 ............................................................................. 1.1190 1.0138 17.7300 20.8895 21.4030 20.0081 

420014 ............................................................................. 0.9635 0.9057 21.2045 21.5658 * 21.3876 

420015 ............................................................................. 1.2398 1.0138 23.1274 24.7383 26.1298 24.6961 

420016 ............................................................................. 0.9619 0.8663 17.0051 17.3837 17.1229 17.1752 

420018 ............................................................................. 1.7534 0.9057 20.4649 23.6356 24.7324 22.8696 

420019 ............................................................................. 1.1129 0.8663 19.6836 20.5472 22.5312 20.8812 

420020 ............................................................................. 1.2595 0.9317 22.1616 24.6592 25.7225 24.3050 

420023 ............................................................................. 1.6530 1.0138 23.2568 25.1035 26.7263 25.0152 

420026 ............................................................................. 1.8566 0.9057 23.7406 29.2961 27.4814 26.8241 

420027 ............................................................................. 1.5759 0.8887 21.0637 22.8322 24.8624 22.9488 

420030 ............................................................................. 1.2331 0.9317 22.6766 24.2847 26.0079 24.3704 

420033 ............................................................................. 1.1361 1.0138 26.2711 27.5740 31.8759 28.5975 

420036 ............................................................................. 1.2525 0.9585 20.6649 21.9641 22.8294 21.8110 

420037 ............................................................................. 1.2494 1.0138 25.5492 26.8750 29.4156 27.3838 

420038 ............................................................................. 1.2524 1.0138 21.6133 22.6741 24.2259 22.8531 

420039 ............................................................................. 1.0376 0.9183 21.9737 24.0637 25.1148 23.7048 

420043 h ........................................................................... 1.0680 0.9183 21.8816 22.9764 23.0555 22.6545 

420048 ............................................................................. 1.2700 0.9057 21.9517 23.1515 24.1910 23.1357 

420049 ............................................................................. 1.2080 0.8869 21.2604 23.2156 23.4769 22.6938 

420051 ............................................................................. 1.4889 0.8988 20.6629 23.9455 24.8026 23.1828 

420053 ............................................................................. 1.1415 0.8663 19.9013 21.1177 22.2825 21.1778 

420054 ............................................................................. 1.0212 0.8663 20.8471 24.0653 24.8931 23.2676 

420055 ............................................................................. 1.0684 0.8663 19.6817 20.3599 21.9764 20.6871 

420056 ............................................................................. 1.4085 0.8663 20.0527 21.1640 21.6963 20.9682 

420057 ............................................................................. 1.0376 0.8988 17.6727 19.7653 23.4311 20.1207 

420059 ............................................................................. 1.0455 0.8663 20.2917 21.4260 * 20.8684 

420061 ............................................................................. 1.1273 0.8663 19.9789 20.8684 * 20.4341 

420062 ............................................................................. 1.0823 0.8663 17.4764 25.6683 25.8389 22.4958 

420064 ............................................................................. 1.1956 0.8869 20.9057 22.1290 23.3610 22.2043 

420065 ............................................................................. 1.3471 0.9433 22.0784 22.8674 24.5715 23.1699 

420066 ............................................................................. 0.9655 0.8988 20.7782 20.5893 23.9048 21.7523 

420067 ............................................................................. 1.2942 0.9316 22.8104 24.6038 25.0345 24.2301 

420068 ............................................................................. 1.3390 0.9317 21.7257 22.2638 23.4248 22.4620 

420069 ............................................................................. 1.0589 0.8663 17.6291 19.6959 20.5546 19.3217 

420070 ............................................................................. 1.2778 0.9057 20.3664 22.4370 23.4355 22.1331 

420071 ............................................................................. 1.3635 0.9807 21.8579 23.1727 24.9418 23.3888 

420072 ............................................................................. 1.0926 0.8663 16.2578 17.5899 18.6742 17.5511 

420073 ............................................................................. 1.3459 0.9057 21.4718 24.0274 24.5813 23.3018 

420074 ............................................................................. *** * 18.7010 * * 18.7010 

420078 ............................................................................. 1.8001 1.0138 24.3273 25.3032 29.4985 26.4127 

420079 ............................................................................. 1.5104 0.9433 23.3992 25.2939 25.5354 24.7810 

420080 ............................................................................. 1.3725 0.9316 26.7489 28.4569 28.4734 27.9158 

420082 ............................................................................. 1.4774 0.9567 23.6936 26.1221 29.8528 26.5169 

420083 ............................................................................. 1.3224 0.9183 24.8508 25.3043 27.1322 25.7973 

420085 ............................................................................. 1.6210 0.9394 24.4040 25.3180 26.8692 25.5532 

420086 ............................................................................. 1.3930 0.9057 24.5760 25.1372 25.7580 25.1689 

420087 ............................................................................. 1.7766 0.9433 22.4526 23.2230 24.3609 23.3441 

420088 ............................................................................. *** * 23.5174 23.1273 * 23.4240 

420089 ............................................................................. 1.3873 0.9433 23.3240 25.2729 26.0074 24.9015 

420091 ............................................................................. 1.3034 0.8988 23.7936 23.4710 27.0189 24.8440 

420093 ............................................................................. 0.9851 0.9183 21.4678 25.1457 27.4766 24.8258 

420097 ............................................................................. *** * * 24.7809 * 24.7809 

430005 ............................................................................. 1.2209 0.8475 18.2647 19.9454 21.8605 19.9621 

430008 2 ........................................................................... 1.1152 0.8475 20.0124 20.9442 22.9340 21.2902 

430011 ............................................................................. 1.2481 0.8475 19.9835 20.6597 * 20.3142 

430012 ............................................................................. 1.2707 0.9616 21.2588 22.7530 24.0850 22.7129 

430013 2 ........................................................................... 1.1784 0.8475 21.3389 22.9675 23.8572 22.7428 

430014 ............................................................................. 1.2515 0.8778 22.0285 25.5387 26.4964 24.6896 

430015 ............................................................................. 1.1338 0.8475 20.5849 23.2035 22.7947 22.1979 

430016 ............................................................................. 1.5813 0.9616 24.2450 26.1495 27.8453 26.0153 

430018 ............................................................................. *** 0.8475 17.9850 * * 17.9850 

430024 ............................................................................. *** 0.8475 18.8357 * * 18.8357 

430029 ............................................................................. 0.8995 0.8475 18.9464 20.2708 * 19.6526 

23532 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

TABLE 2.—HOSPITAL CASE-MIX INDEXES FOR DISCHARGES OCCURRING IN FEDERAL FISCAL YEAR 2004; HOSPITAL AVERAGE HOURLY WAGE FOR FEDERAL FISCAL YEARS 2004 (2000 WAGE DATA), 2005 (2001 WAGE DATA), AND 2006 

(2002 WAGE DATA) WAGE INDEXES AND 3-YEAR AVERAGE OF HOSPITAL AVERAGE HOURLY WAGES—Continued 

Provider number Case-mix 

index 

Wage index 

FY 2006 

Average 

hourly wage 

FY 2004 

Average 

hourly wage 

FY 2005 

Average 

hourly wage 

FY 2006 

Average 

hourly 

wage ** 

(3 years) 

430031 2 ........................................................................... 0.9339 0.8475 15.2321 15.6112 15.9156 15.5961 

430033 ............................................................................. *** 0.8475 21.6254 * * 21.6254 

430047 ............................................................................. 0.9833 0.8475 18.2774 21.9116 18.8982 19.7432 

430048 ............................................................................. 1.2364 0.8475 20.0607 21.1718 23.0783 21.5127 

430054 ............................................................................. 0.9420 0.9616 17.8871 * * 17.8871 

430064 ............................................................................. 1.0393 0.8475 14.3407 16.4314 17.5376 16.1075 

430077 ............................................................................. 1.6950 0.9027 21.6786 23.4835 25.1763 23.4802 

430089 ............................................................................. 1.6248 0.9360 19.8572 21.1109 22.5625 21.3078 

430090 ............................................................................. 1.4120 0.9616 25.6873 26.0851 25.7499 25.8502 

430091 ............................................................................. 2.1791 0.9027 22.2824 23.8897 25.0828 23.8977 

430092 ............................................................................. 1.7787 0.8475 19.7354 20.2570 23.8858 21.3414 

430093 ............................................................................. 0.9141 0.9027 23.8820 23.1526 29.5244 25.7876 

430094 ............................................................................. 1.8543 0.9207 20.8743 18.5429 19.0014 19.4190 

430095 ............................................................................. 2.3163 0.9616 * 24.7074 28.1749 26.5823 

430096 ............................................................................. 1.9499 0.8475 * * 21.7103 21.7103 

440001 ............................................................................. 1.1144 0.7958 18.9833 17.4802 19.3100 18.5533 

440002 ............................................................................. 1.6911 0.8964 22.0178 23.2177 24.6664 23.3294 

440003 ............................................................................. 1.2046 0.9757 21.6336 24.5168 25.9209 24.0777 

440006 ............................................................................. 1.4022 0.9757 24.3173 26.7983 28.5951 26.6300 

440007 ............................................................................. 0.9406 0.7915 14.8015 13.7042 25.8236 17.2437 

440008 ............................................................................. 0.9974 0.8508 20.9237 22.1405 23.4301 22.0908 

440009 ............................................................................. 1.1859 0.7915 19.6564 21.1274 21.5970 20.8327 

440010 ............................................................................. 0.9389 0.7915 16.7270 16.9060 17.1803 16.9489 

440011 ............................................................................. 1.3028 0.8470 20.5036 21.6861 22.5068 21.6145 

440012 ............................................................................. 1.4390 0.8095 21.1213 21.4769 22.3029 21.6368 

440015 ............................................................................. 1.8237 0.8470 23.4485 22.5583 23.7422 23.2495 

440016 ............................................................................. 0.9690 0.7915 20.1504 20.0982 22.1646 20.8341 

440017 ............................................................................. 1.7649 0.8095 21.8033 22.5313 22.9364 22.4333 

440018 ............................................................................. 1.1326 0.7958 21.2242 21.7239 23.3444 22.1229 

440019 ............................................................................. 1.7880 0.8470 21.8854 23.8802 25.2553 23.6676 

440020 ............................................................................. 1.0554 0.9124 21.1075 23.1718 23.9475 22.7656 

440023 ............................................................................. 0.9515 0.7915 15.5410 17.0335 18.2884 16.9816 

440024 ............................................................................. 1.2316 0.8160 19.9751 20.3658 23.2478 21.1469 

440025 ............................................................................. 1.1856 0.7915 19.1478 19.5995 20.6798 19.8282 

440026 ............................................................................. *** * 25.1655 26.9149 26.8986 26.2876 

440029 ............................................................................. 1.3373 0.9757 24.1379 25.8538 28.0779 26.0679 

440030 ............................................................................. 1.2498 0.8758 19.9056 20.0586 26.1060 22.0081 

440031 ............................................................................. 1.0626 0.7915 17.0289 18.0944 19.6685 18.2797 

440032 ............................................................................. 1.0136 0.8095 14.7683 16.0734 18.5277 16.4708 

440033 ............................................................................. 1.0486 0.7915 17.2637 18.7749 20.7917 19.0076 

440034 ............................................................................. 1.5293 0.8470 22.2478 23.1121 23.5403 22.9348 

440035 ............................................................................. 1.3430 0.9492 21.4990 22.3230 24.3752 22.7486 

440039 ............................................................................. 1.9897 0.9757 25.0874 26.4647 28.1729 26.6593 

440040 ............................................................................. 0.9253 0.7915 16.9886 17.7647 17.8510 17.5455 

440041 ............................................................................. 0.9316 0.8160 15.5784 17.4074 17.9409 17.0933 

440046 ............................................................................. 1.1385 0.9757 22.3380 25.5329 26.1341 24.7333 

440047 ............................................................................. 0.8547 0.7915 18.7962 20.4812 21.4280 20.2387 

440048 ............................................................................. 1.8251 0.9346 23.1553 24.3283 27.7560 24.7999 

440049 ............................................................................. 1.5582 0.9346 21.1930 22.9755 25.3043 23.1991 

440050 ............................................................................. 1.2790 0.9312 21.1397 21.8972 23.1362 22.0679 

440051 ............................................................................. 0.9362 0.7915 19.0165 20.7948 21.9108 20.5095 

440052 ............................................................................. 0.9561 0.7915 18.1935 20.1875 21.1133 19.9032 

440053 ............................................................................. 1.2082 0.9757 22.0345 23.9083 25.4345 23.8916 

440054 ............................................................................. 1.1252 0.7915 15.4208 20.5992 21.4400 18.6411 

440056 ............................................................................. 1.1345 0.8758 19.3108 20.4088 22.1068 20.7270 

440057 ............................................................................. 1.0371 0.7915 14.1477 14.6242 16.4451 15.0915 

440058 ............................................................................. 1.1730 0.9099 21.7512 22.6014 22.9263 22.4470 

440059 ............................................................................. 1.5012 0.9492 22.4248 23.9301 26.3531 24.2538 

440060 ............................................................................. 1.0098 0.8799 20.2189 22.7133 23.3014 22.1119 

440061 ............................................................................. 1.0870 0.7915 19.5458 21.2085 21.8274 20.8215 

440063 ............................................................................. 1.5962 0.7958 19.7468 21.8578 22.3256 21.2848 

440064 ............................................................................. 0.9863 0.9099 19.4020 20.9742 22.0955 20.8374 

440065 ............................................................................. 1.2170 0.9757 19.9099 21.4794 22.3247 21.2895 

440067 ............................................................................. 1.1694 0.8470 19.5643 22.1410 23.1089 21.6500 

440068 ............................................................................. 1.1443 0.9099 20.9188 23.1705 24.5971 22.9451 

440070 ............................................................................. 0.9466 0.7915 18.3717 19.0240 19.4372 18.9540 

440072 ............................................................................. 1.1880 0.9108 19.6579 20.9294 27.1443 22.1374 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23533 

TABLE 2.—HOSPITAL CASE-MIX INDEXES FOR DISCHARGES OCCURRING IN FEDERAL FISCAL YEAR 2004; HOSPITAL AVERAGE HOURLY WAGE FOR FEDERAL FISCAL YEARS 2004 (2000 WAGE DATA), 2005 (2001 WAGE DATA), AND 2006 

(2002 WAGE DATA) WAGE INDEXES AND 3-YEAR AVERAGE OF HOSPITAL AVERAGE HOURLY WAGES—Continued 

Provider number Case-mix 

index 

Wage index 

FY 2006 

Average 

hourly wage 

FY 2004 

Average 

hourly wage 

FY 2005 

Average 

hourly wage 

FY 2006 

Average 

hourly 

wage ** 

(3 years) 

440073 ............................................................................. 1.3595 0.9492 20.7181 22.2959 23.9198 22.3108 

440081 h ........................................................................... 1.1378 0.8470 18.3141 19.0328 19.7918 19.0786 

440082 ............................................................................. 2.1607 0.9757 26.1497 28.7828 27.9724 27.6484 

440083 ............................................................................. 0.9067 0.7915 15.7015 16.0956 17.3329 16.4160 

440084 ............................................................................. 1.1637 0.7915 15.0510 15.2825 16.3738 15.6128 

440091 ............................................................................. 1.6254 0.9099 23.0296 26.1122 25.6797 24.9494 

440102 ............................................................................. 1.1346 0.7915 16.6548 17.5140 17.5261 17.2560 

440104 ............................................................................. 1.7607 0.9099 21.9870 23.3731 25.3739 23.6244 

440105 ............................................................................. 1.0199 0.7958 19.2902 20.7821 22.3438 20.8223 

440109 ............................................................................. 0.9843 0.7915 17.3578 18.2508 18.6720 18.1156 

440110 ............................................................................. 1.1772 0.8470 19.9715 20.9039 21.3287 20.7233 

440111 ............................................................................. 1.2422 0.9757 24.9883 25.8821 28.5705 26.5016 

440114 ............................................................................. 0.9851 0.7915 20.1152 21.4271 24.0147 21.9369 

440115 ............................................................................. 0.9888 0.7915 18.5389 20.0642 21.7830 20.1587 

440120 ............................................................................. 1.5755 0.8470 22.4031 23.9003 25.7636 24.0777 

440125 ............................................................................. 1.5716 0.8470 21.1018 21.9337 22.3888 21.8259 

440130 ............................................................................. 1.1649 0.7915 20.6363 21.6480 23.4517 21.9020 

440131 ............................................................................. 1.1987 0.9346 21.0640 22.4119 24.9598 22.8950 

440132 ............................................................................. 1.2681 0.7915 18.9580 20.5716 21.5085 20.3655 

440133 ............................................................................. 1.5674 0.9757 23.3600 27.5019 26.2422 25.6963 

440135 ............................................................................. 1.0782 0.9757 23.9749 25.3928 26.6615 25.3742 

440137 ............................................................................. 1.0485 0.7915 16.5529 18.2073 20.6663 18.4329 

440141 ............................................................................. 0.9487 0.7915 19.2607 19.4528 21.3313 20.0578 

440142 ............................................................................. 0.8702 0.9757 17.7587 * * 17.7587 

440144 ............................................................................. 1.1976 0.7915 19.7938 22.3671 23.3828 21.8222 

440145 ............................................................................. 0.9916 0.7915 18.2019 20.9863 20.7875 19.9424 

440147 ............................................................................. *** * 25.0780 28.9038 31.2003 28.2394 

440148 ............................................................................. 1.1199 0.9492 20.7693 23.0697 24.6412 22.8692 

440149 ............................................................................. 1.0185 0.7915 18.1316 19.8020 20.4562 19.4498 

440150 ............................................................................. 1.3517 0.9757 22.8733 25.4952 26.8308 25.0868 

440151 ............................................................................. 1.0856 0.9492 21.1576 23.3037 23.9808 22.8559 

440152 ............................................................................. 1.8738 0.9346 22.7498 25.9495 26.5513 25.0265 

440153 ............................................................................. 1.0018 0.7915 19.9486 22.7744 22.2846 21.7049 

440156 ............................................................................. 1.4931 0.9099 23.7799 25.6333 26.9689 25.5243 

440159 ............................................................................. 1.4244 0.9346 20.5719 21.1073 22.8645 21.5659 

440161 ............................................................................. 1.8202 0.9757 26.1354 28.6774 28.6854 27.8923 

440162 ............................................................................. *** * 20.3909 16.5305 21.1418 19.2406 

440166 ............................................................................. 1.5235 0.9346 23.1692 27.1355 22.6509 24.5576 

440168 ............................................................................. 0.9905 0.9346 21.2113 22.1764 22.8768 22.0809 

440173 ............................................................................. 1.6407 0.8470 20.8442 20.8723 22.8692 21.5604 

440174 ............................................................................. 0.8745 0.7915 19.2201 20.7960 22.0974 20.6472 

440175 ............................................................................. 1.0488 0.9492 22.3331 24.0005 22.7299 23.0174 

440176 ............................................................................. 1.2854 0.8095 20.4861 22.0079 23.6659 22.0556 

440180 ............................................................................. 1.2061 0.8470 21.2398 21.9781 23.3808 22.2150 

440181 ............................................................................. 0.9106 0.7915 19.6133 21.1406 22.7150 21.1984 

440182 ............................................................................. 0.9022 0.7915 19.3928 20.2630 22.3612 20.6845 

440183 ............................................................................. 1.5283 0.9346 24.9282 27.7769 27.1515 26.6633 

440184 ............................................................................. 0.9990 0.7958 21.4484 20.8219 22.3475 21.5303 

440185 ............................................................................. 1.1611 0.9099 22.1845 23.4172 23.9052 23.2612 

440186 ............................................................................. 1.0310 0.9757 23.0193 24.6773 25.7445 24.4615 

440187 ............................................................................. 1.0821 0.7915 19.9478 21.7637 21.3252 21.0131 

440189 ............................................................................. 1.3728 0.8964 23.2866 24.7851 27.5435 25.2579 

440192 ............................................................................. 1.0167 0.9492 21.3228 25.1119 25.7495 24.1386 

440193 ............................................................................. 1.2566 0.9757 22.0345 24.3911 24.4299 23.6341 

440194 ............................................................................. 1.3630 0.9757 24.4508 26.2498 26.6527 25.8291 

440197 ............................................................................. 1.2605 0.9757 24.2660 26.4999 27.1534 25.9812 

440200 ............................................................................. 0.9405 0.9757 16.7752 17.0633 17.7491 17.1850 

440203 ............................................................................. 0.9753 0.7915 * 17.7639 19.3864 18.5423 

440217 ............................................................................. 1.3463 0.9346 23.3544 25.9667 28.5968 26.1820 

440218 ............................................................................. 0.8931 0.9757 20.1377 26.3741 24.6465 23.5719 

440220 ............................................................................. *** * 21.9117 * * 21.9117 

450002 ............................................................................. 1.4427 0.8954 24.0411 25.4975 25.7171 25.1126 

450005 ............................................................................. 1.0651 0.8422 21.7110 23.4049 23.5576 22.9913 

450007 ............................................................................. 1.2962 0.8987 18.3738 19.2875 20.7321 19.4904 

450008 ............................................................................. 1.3133 0.8566 20.1816 22.0934 22.9669 21.7810 

450010 ............................................................................. 1.5052 0.8327 20.3023 22.4133 23.7529 22.1525 

450011 ............................................................................. 1.6756 0.8911 22.1472 24.0715 24.8831 23.7169 

23534 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

TABLE 2.—HOSPITAL CASE-MIX INDEXES FOR DISCHARGES OCCURRING IN FEDERAL FISCAL YEAR 2004; HOSPITAL AVERAGE HOURLY WAGE FOR FEDERAL FISCAL YEARS 2004 (2000 WAGE DATA), 2005 (2001 WAGE DATA), AND 2006 

(2002 WAGE DATA) WAGE INDEXES AND 3-YEAR AVERAGE OF HOSPITAL AVERAGE HOURLY WAGES—Continued 

Provider number Case-mix 

index 

Wage index 

FY 2006 

Average 

hourly wage 

FY 2004 

Average 

hourly wage 

FY 2005 

Average 

hourly wage 

FY 2006 

Average 

hourly 

wage ** 

(3 years) 

450014 ............................................................................. 1.0286 0.8148 20.6936 22.5001 * 21.5732 

450015 ............................................................................. 1.5729 1.0226 23.9526 24.0730 27.4012 25.2046 

450016 ............................................................................. *** * 20.1232 22.1368 * 21.1548 

450018 ............................................................................. 1.3942 1.0008 22.9019 24.6443 26.7999 24.7633 

450020 ............................................................................. 0.9466 0.9451 19.1087 17.7148 18.3047 18.3252 

450021 ............................................................................. 1.8194 1.0226 25.0769 28.5578 29.1350 27.5806 

450023 ............................................................................. 1.3878 0.8148 19.1645 20.9278 22.0558 20.7053 

450024 ............................................................................. 1.3228 0.8954 20.7727 20.5868 23.6211 21.6539 

450028 ............................................................................. 1.5658 0.9853 22.7775 25.6030 26.8250 25.1270 

450029 ............................................................................. 1.5162 0.8101 19.9198 23.9709 23.2995 22.4069 

450031 ............................................................................. 1.4488 1.0226 21.7621 27.0328 27.9626 25.5466 

450032 ............................................................................. 1.1987 0.8767 20.5217 20.8306 27.0748 22.7202 

450033 ............................................................................. 1.6186 0.9853 26.5990 29.0541 28.5266 28.0983 

450034 ............................................................................. 1.5259 0.8422 21.6097 23.4615 24.1589 23.0888 

450035 ............................................................................. 1.5166 1.0008 24.1860 25.4580 26.2838 25.3196 

450037 ............................................................................. 1.5141 0.8741 23.1179 23.1176 24.2684 23.5229 

450039 ............................................................................. 1.3588 0.9955 22.0058 23.3034 24.7347 23.3847 

450040 ............................................................................. 1.7455 0.8790 21.2990 23.8047 24.9590 23.3165 

450042 ............................................................................. 1.6976 0.8532 21.8886 22.6936 24.1181 22.9317 

450044 ............................................................................. 1.6507 1.0226 24.1127 25.8403 28.8098 26.9711 

450046 ............................................................................. 1.5525 0.8557 20.9239 22.0695 23.4907 22.1959 

450047 ............................................................................. 0.8562 0.9853 21.8840 22.7242 19.8221 21.4269 

450050 ............................................................................. 0.9271 0.8038 19.5171 21.6933 23.3044 21.3893 

450051 ............................................................................. 1.7617 1.0226 24.5533 27.2523 28.0411 26.6907 

450052 ............................................................................. 0.9686 0.8038 17.6543 19.7185 19.7774 19.2138 

450053 ............................................................................. 0.9574 0.8038 18.6556 19.4978 21.9082 20.0823 

450054 ............................................................................. 1.6531 0.8566 23.2915 25.1229 24.2782 24.2283 

450055 ............................................................................. 1.1284 0.8038 18.2235 20.5235 22.1979 20.3131 

450056 ............................................................................. 1.7820 0.9451 24.4197 25.6685 27.0530 25.7808 

450058 ............................................................................. 1.5325 0.8987 22.0158 24.7442 25.9653 24.1658 

450059 ............................................................................. 1.3149 0.9451 22.8792 26.8209 26.6535 25.4407 

450064 ............................................................................. 1.4037 0.9955 19.1271 24.2920 23.8748 22.4752 

450068 ............................................................................. 2.0137 1.0008 24.0925 26.2864 27.9633 26.1666 

450072 ............................................................................. 1.1350 1.0008 20.3683 22.5010 24.0166 22.2336 

450073 ............................................................................. 0.9362 0.8038 19.2398 20.0464 21.7337 20.3411 

450078 ............................................................................. 0.9261 0.8038 14.8285 17.2196 15.8968 15.9697 

450079 ............................................................................. 1.5320 1.0226 24.0085 27.0443 28.1096 26.3674 

450080 ............................................................................. 1.1799 0.8621 21.0353 21.2482 22.9835 21.7735 

450081 ............................................................................. 1.0360 0.8038 19.2632 * * 19.2632 

450083 ............................................................................. 1.7207 0.9322 22.5063 24.9182 25.8214 24.4447 

450085 ............................................................................. 1.0173 0.8038 18.1922 19.4524 22.0840 19.8958 

450087 ............................................................................. 1.3393 0.9955 24.5976 26.4203 29.1587 26.8455 

450090 ............................................................................. 1.1561 0.8038 17.1073 17.6506 19.4244 18.0792 

450092 ............................................................................. 1.1362 0.8038 16.0199 20.4921 23.2071 19.7031 

450094 ............................................................................. 1.0935 1.0226 25.8313 25.3618 25.2434 25.4570 

450096 ............................................................................. 1.3677 0.8422 19.8012 22.8722 24.1619 22.3082 

450097 ............................................................................. 1.4253 1.0008 22.2467 24.9380 26.4965 24.6105 

450098 ............................................................................. 0.9223 0.8621 20.4795 22.9005 22.6626 21.9800 

450099 ............................................................................. 1.1731 0.9165 21.4482 24.0293 26.6796 24.1168 

450101 ............................................................................. 1.5502 0.8532 20.1473 20.6575 23.6905 21.4670 

450102 ............................................................................. 1.7209 0.9322 20.9900 23.1773 24.5503 22.9587 

450104 ............................................................................. 1.1697 0.8987 19.7126 22.5165 23.8469 22.0194 

450107 ............................................................................. 1.4575 0.8954 23.2209 23.8770 25.9326 24.3252 

450108 ............................................................................. 1.1001 0.8987 18.8084 19.3561 19.4935 19.2181 

450109 ............................................................................. *** 0.8038 15.1459 * * 15.1459 

450113 ............................................................................. *** 0.8038 37.8944 * 54.6681 43.1390 

450119 ............................................................................. 1.2979 0.8945 20.8840 24.1392 25.7008 23.6793 

450121 ............................................................................. 1.4458 0.9955 24.6090 25.8826 25.7051 25.4063 

450123 ............................................................................. 1.1207 0.8422 17.8629 19.5872 21.2154 19.5002 

450124 ............................................................................. 1.8251 0.9451 24.2788 26.0280 27.4198 26.0262 

450126 ............................................................................. 1.3283 1.0008 24.1961 27.3021 28.3033 26.6832 

450128 ............................................................................. 1.2202 0.8945 * 21.4190 23.3633 22.3457 

450130 ............................................................................. 1.1654 0.8987 19.6199 20.2777 21.5226 20.5273 

450131 ............................................................................. 1.2121 0.8557 20.0434 23.2317 23.7098 22.3750 

450132 ............................................................................. 1.5283 0.9893 22.4680 26.8476 28.6954 25.9595 

450133 ............................................................................. 1.5415 0.9522 25.3928 25.0972 26.8344 25.8308 

450135 ............................................................................. 1.6894 0.9955 22.5673 24.3858 26.0755 24.4084 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23535 

TABLE 2.—HOSPITAL CASE-MIX INDEXES FOR DISCHARGES OCCURRING IN FEDERAL FISCAL YEAR 2004; HOSPITAL AVERAGE HOURLY WAGE FOR FEDERAL FISCAL YEARS 2004 (2000 WAGE DATA), 2005 (2001 WAGE DATA), AND 2006 

(2002 WAGE DATA) WAGE INDEXES AND 3-YEAR AVERAGE OF HOSPITAL AVERAGE HOURLY WAGES—Continued 

Provider number Case-mix 

index 

Wage index 

FY 2006 

Average 

hourly wage 

FY 2004 

Average 

hourly wage 

FY 2005 

Average 

hourly wage 

FY 2006 

Average 

hourly 

wage ** 

(3 years) 

450137 ............................................................................. 1.6059 0.9955 24.9732 27.0081 30.4254 27.6976 

450140 ............................................................................. 0.8835 0.8038 18.3835 22.4695 * 20.3190 

450143 ............................................................................. 1.0330 0.9451 18.4204 19.7487 21.8705 20.0996 

450144 ............................................................................. 1.1455 0.9593 21.3896 20.9599 21.3289 21.2289 

450146 ............................................................................. *** 0.8038 16.6808 * * 16.6808 

450148 ............................................................................. 1.1489 0.9955 22.1351 23.5037 25.3498 23.7382 

450151 ............................................................................. 1.1987 0.8038 17.9127 20.1356 22.2915 20.0948 

450152 ............................................................................. 1.1854 0.8566 20.0146 21.6351 22.7463 21.4376 

450154 ............................................................................. 1.2665 0.8038 16.5204 18.6058 21.2021 18.7210 

450155 ............................................................................. 1.0266 0.8038 18.4021 17.9306 18.0589 18.1275 

450157 ............................................................................. 1.0057 0.8038 17.8764 17.8812 * 17.8788 

450160 ............................................................................. 0.9248 0.8038 20.7736 21.9118 * 21.3607 

450162 ............................................................................. 1.3639 0.8790 26.0570 31.0645 30.9903 29.3951 

450163 ............................................................................. 0.9730 0.8038 19.8194 20.3280 23.1400 21.0903 

450165 ............................................................................. 1.1177 0.8987 16.1632 20.2414 24.3242 20.2279 

450176 ............................................................................. 1.3178 0.8945 19.1823 20.9392 20.9297 20.4107 

450177 ............................................................................. 1.2130 0.8038 17.2637 19.7657 21.3322 19.4690 

450178 ............................................................................. 0.9642 0.8038 19.1186 20.2992 24.7301 21.2492 

450184 ............................................................................. 1.5254 1.0008 24.0596 25.3935 26.8458 25.4934 

450185 ............................................................................. 0.9793 0.8038 14.3594 15.5838 * 14.9644 

450187 ............................................................................. 1.1635 1.0008 22.6275 24.2400 25.6786 24.2306 

450188 ............................................................................. 0.9262 0.8038 17.6158 18.9586 20.4070 19.0169 

450191 ............................................................................. 1.1247 0.9451 23.2261 25.9078 26.0298 25.1584 

450192 ............................................................................. 1.0805 0.9955 20.1718 22.5118 22.5880 21.7848 

450193 ............................................................................. 2.0537 1.0008 26.6580 29.2751 32.2964 29.4595 

450194 ............................................................................. 1.3506 0.9955 22.7310 22.3348 24.8972 23.2572 

450196 ............................................................................. 1.4168 0.9955 20.1938 23.6170 24.7557 23.2376 

450200 ............................................................................. 1.4482 0.8293 20.4656 22.0923 23.5344 22.0868 

450201 ............................................................................. 0.9125 0.8038 19.5907 20.3350 20.9809 20.3028 

450203 ............................................................................. 1.1655 0.9514 22.9226 23.3953 24.1675 23.5222 

450209 ............................................................................. 1.8856 0.9165 23.4794 24.4977 26.0958 24.6956 

450210 ............................................................................. 0.9537 0.8038 16.7851 19.6340 19.9832 18.8463 

450211 ............................................................................. 1.3415 1.0008 20.0280 20.7982 23.8230 21.4806 

450213 ............................................................................. 1.7482 0.8987 21.1280 21.7930 23.9676 22.3693 

450214 ............................................................................. 1.1722 1.0008 22.4543 23.9112 25.9598 24.1177 

450219 ............................................................................. 0.9721 0.8038 21.0691 20.8255 21.7934 21.2690 

450221 ............................................................................. 1.1435 0.8038 19.6778 20.6887 20.3186 20.2506 

450222 ............................................................................. 1.5561 1.0008 23.5033 26.2975 27.4426 25.8797 

450224 ............................................................................. 1.4143 0.9164 20.4453 22.2250 24.1956 22.3315 

450229 ............................................................................. 1.6333 0.8038 17.9811 19.8279 21.4459 19.7433 

450231 ............................................................................. 1.6297 0.9165 21.3086 23.9532 25.2852 23.5313 

450234 ............................................................................. 0.9831 0.8038 22.3954 23.6695 18.4451 21.2354 

450235 ............................................................................. 0.9124 0.8038 18.7028 19.1453 21.5138 19.8415 

450236 ............................................................................. 1.0405 0.8038 17.7373 19.2987 22.0788 19.5556 

450237 ............................................................................. 1.6743 0.8987 22.4477 25.1504 24.8901 24.1935 

450239 ............................................................................. 0.9310 0.8566 19.3655 21.8595 21.1945 20.7705 

450241 ............................................................................. 0.9436 0.8038 17.4151 18.1155 18.7957 18.0879 

450243 ............................................................................. 1.0022 0.8038 13.0790 14.0589 15.4636 14.1605 

450249 ............................................................................. 0.9833 0.8038 13.1222 16.5616 * 14.7712 

450250 ............................................................................. *** 0.8038 13.3731 * * 13.3731 

450264 ............................................................................. 0.9236 0.8038 13.5345 15.4111 * 14.4829 

450269 ............................................................................. 1.0146 0.8038 12.6907 14.8204 * 13.7206 

450270 ............................................................................. 1.0976 0.8038 13.9053 15.0879 14.4325 14.4468 

450271 ............................................................................. 1.1532 0.9514 18.3659 19.4299 21.7719 19.9620 

450272 ............................................................................. 1.2039 0.9451 21.4520 23.7933 25.9864 23.7631 

450276 ............................................................................. 0.8990 0.8038 12.8895 16.0264 16.6319 15.2952 

450280 ............................................................................. 1.5066 1.0226 23.1664 27.4523 28.7233 26.4522 

450283 ............................................................................. 1.0602 0.9955 17.1013 20.0069 20.9680 19.5520 

450289 ............................................................................. 1.3288 1.0008 23.7108 27.3864 28.5665 26.5635 

450292 ............................................................................. 1.2940 1.0226 23.4257 23.5330 25.0411 24.0121 

450293 ............................................................................. 0.8704 0.8038 17.7673 20.0898 21.3136 19.7647 

450296 ............................................................................. 1.0400 1.0008 20.4483 29.2006 27.9690 25.4406 

450299 ............................................................................. 1.5781 0.8911 22.9849 25.8183 26.4933 25.0990 

450303 ............................................................................. 0.8372 0.8790 16.1330 * * 16.1330 

450315 ............................................................................. *** 1.0226 26.4677 27.9780 * 27.2229 

450320 ............................................................................. *** * 26.8089 * * 26.8089 

450327 ............................................................................. *** 0.8038 14.3848 * * 14.3848 

23536 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

TABLE 2.—HOSPITAL CASE-MIX INDEXES FOR DISCHARGES OCCURRING IN FEDERAL FISCAL YEAR 2004; HOSPITAL AVERAGE HOURLY WAGE FOR FEDERAL FISCAL YEARS 2004 (2000 WAGE DATA), 2005 (2001 WAGE DATA), AND 2006 

(2002 WAGE DATA) WAGE INDEXES AND 3-YEAR AVERAGE OF HOSPITAL AVERAGE HOURLY WAGES—Continued 

Provider number Case-mix 

index 

Wage index 

FY 2006 

Average 

hourly wage 

FY 2004 

Average 

hourly wage 

FY 2005 

Average 

hourly wage 

FY 2006 

Average 

hourly 

wage ** 

(3 years) 

450340 ............................................................................. 1.3755 0.8287 20.0621 22.7826 24.0636 22.3350 

450346 ............................................................................. 1.3855 0.8422 20.1921 21.9717 22.2469 21.4909 

450347 ............................................................................. 1.1384 1.0008 21.7142 22.8133 27.2203 23.9176 

450348 ............................................................................. 0.9886 0.8038 15.6324 17.0198 18.7675 17.1642 

450351 ............................................................................. 1.2212 0.9514 22.2597 23.5895 25.6859 23.9245 

450352 ............................................................................. 1.1057 1.0226 21.8138 23.4297 24.8012 23.3447 

450353 ............................................................................. 1.2803 0.8038 19.5263 20.9271 24.4454 21.5974 

450358 ............................................................................. 2.0076 1.0008 25.9105 29.3408 30.4280 28.6741 

450362 ............................................................................. 0.9855 0.8038 20.6340 22.0223 25.4372 22.7898 

450369 ............................................................................. 1.0166 0.8038 16.5636 17.5360 18.4848 17.6077 

450370 ............................................................................. 1.1704 0.8038 19.0340 22.6815 20.0832 20.4877 

450371 ............................................................................. *** * 17.3415 * * 17.3415 

450373 ............................................................................. 0.9087 0.8038 17.7955 20.5789 22.2213 20.1017 

450374 ............................................................................. 0.9164 0.8038 15.0670 17.4509 23.2285 18.2702 

450378 ............................................................................. 1.3340 1.0008 25.8048 29.5108 30.7684 28.7797 

450379 ............................................................................. 1.3574 1.0226 29.0865 31.1573 30.6072 30.3060 

450381 ............................................................................. 0.9257 0.9451 19.0584 20.9200 22.0482 20.7572 

450388 ............................................................................. 1.6460 0.8987 22.4441 24.1598 25.8674 24.3854 

450389 ............................................................................. 1.1827 0.9955 20.7160 22.3803 23.8764 22.4221 

450393 ............................................................................. *** 0.9518 23.8237 24.6872 18.4551 22.6427 

450395 ............................................................................. 1.0142 0.8038 19.1938 23.9689 24.8656 22.6314 

450399 ............................................................................. 0.9249 0.8038 19.1571 19.5928 18.2074 18.9826 

450400 ............................................................................. 1.1916 0.8532 20.1376 22.0103 23.1739 21.7697 

450403 ............................................................................. 1.2709 1.0226 24.6215 27.8138 29.3063 27.2736 

450411 ............................................................................. 0.9558 0.8038 16.9558 17.6570 19.6086 18.1139 

450417 ............................................................................. 0.8643 1.0008 16.1957 17.8078 20.0350 18.0319 

450418 ............................................................................. 1.2488 1.0008 25.1306 27.0283 26.8434 26.3230 

450419 ............................................................................. 1.1760 0.9955 26.7662 28.4122 31.0404 28.7694 

450422 ............................................................................. 1.0462 1.0226 29.0032 29.5592 30.6659 29.7888 

450424 ............................................................................. 1.2797 1.0008 22.0682 23.1253 28.3149 24.8057 

450431 ............................................................................. 1.5343 0.9451 22.9545 24.7346 25.2477 24.3602 

450438 ............................................................................. 1.1444 1.0008 19.2165 22.0476 21.9351 21.1413 

450446 ............................................................................. 0.6161 1.0008 14.1684 14.9983 14.3132 14.4984 

450447 ............................................................................. 1.1971 0.9955 21.0247 22.5602 23.5047 22.3940 

450451 ............................................................................. 1.0873 0.9514 21.1046 22.3834 23.3042 22.3121 

450460 ............................................................................. 0.9348 0.8038 17.9487 19.5709 20.5812 19.4136 

450462 ............................................................................. 1.6600 1.0226 24.0081 25.6952 27.8923 25.9496 

450464 ............................................................................. *** 0.8038 16.1987 * * 16.1987 

450469 ............................................................................. 1.4541 0.9518 24.0794 26.6781 28.7890 26.6238 

450473 ............................................................................. *** * 18.6002 * * 18.6002 

450484 ............................................................................. 1.3734 1.0008 23.2881 23.0604 25.3527 23.9206 

450488 ............................................................................. 1.1123 0.8741 22.5650 22.3949 23.9144 22.9600 

450489 ............................................................................. 1.0160 0.8038 18.5941 19.6884 21.4771 19.8409 

450497 ............................................................................. 1.0329 0.8038 17.1327 17.6614 18.8344 17.8832 

450498 ............................................................................. 0.8732 0.8038 19.2984 16.4358 17.7822 17.7509 

450508 ............................................................................. 1.4085 0.9164 20.8183 23.5066 23.9572 22.7686 

450514 ............................................................................. 1.1119 0.8422 21.0116 21.4034 22.6552 21.6987 

450517 ............................................................................. 0.9088 0.8038 14.4246 15.2707 22.0440 17.2013 

450518 ............................................................................. 1.6338 0.8422 21.1015 22.2587 24.1194 22.4755 

450523 ............................................................................. *** * 22.3034 28.6387 * 25.2834 

450530 ............................................................................. 1.1553 1.0008 23.3005 26.1998 28.7451 26.1850 

450534 ............................................................................. 0.8962 0.8038 22.5156 20.4715 * 21.4079 

450535 ............................................................................. *** * 23.7255 29.4427 * 26.5477 

450537 ............................................................................. 1.3531 1.0226 22.5972 23.9256 27.5856 24.8361 

450539 ............................................................................. 1.2112 0.8038 18.4299 20.0343 21.0442 19.8677 

450545 ............................................................................. *** * 21.7762 22.8130 * 22.2858 

450547 ............................................................................. 0.9601 0.9955 22.6557 21.8106 21.6542 22.0062 

450558 ............................................................................. 1.7596 0.8038 21.4201 25.0837 26.1551 24.1840 

450563 ............................................................................. 1.3725 0.9955 27.5671 27.9427 28.7289 28.1251 

450565 ............................................................................. 1.2388 0.8038 17.2171 22.1971 23.8847 20.9966 

450571 ............................................................................. 1.4990 0.8287 21.5688 20.9651 22.7703 21.7784 

450573 ............................................................................. 1.1238 0.8038 18.6233 21.6974 20.1479 20.0755 

450578 ............................................................................. 0.9390 0.8038 17.3010 20.0454 20.2695 19.1233 

450580 ............................................................................. 1.1057 0.8038 18.5225 20.4293 21.1574 20.0321 

450584 ............................................................................. 1.0396 0.8038 16.9021 19.0373 21.0808 18.9453 

450586 ............................................................................. 0.9605 0.8038 14.9061 14.6574 16.1003 15.2149 

450587 ............................................................................. 1.1650 0.8038 19.0648 19.9712 20.4512 19.8609 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23537 

TABLE 2.—HOSPITAL CASE-MIX INDEXES FOR DISCHARGES OCCURRING IN FEDERAL FISCAL YEAR 2004; HOSPITAL AVERAGE HOURLY WAGE FOR FEDERAL FISCAL YEARS 2004 (2000 WAGE DATA), 2005 (2001 WAGE DATA), AND 2006 

(2002 WAGE DATA) WAGE INDEXES AND 3-YEAR AVERAGE OF HOSPITAL AVERAGE HOURLY WAGES—Continued 

Provider number Case-mix 

index 

Wage index 

FY 2006 

Average 

hourly wage 

FY 2004 

Average 

hourly wage 

FY 2005 

Average 

hourly wage 

FY 2006 

Average 

hourly 

wage ** 

(3 years) 

450591 ............................................................................. 1.2007 1.0008 19.6229 22.4991 23.9992 22.0639 

450596 h ........................................................................... 1.0985 0.9514 24.3714 24.7477 25.3317 24.8345 

450597 ............................................................................. 0.9702 0.8038 19.9596 22.9337 23.1711 22.1268 

450603 ............................................................................. *** 0.8038 20.6138 * * 20.6138 

450605 ............................................................................. 1.1521 0.8557 22.0210 23.8820 22.2205 22.7037 

450609 ............................................................................. 0.9809 0.8038 16.6870 18.3856 * 17.5807 

450610 ............................................................................. 1.5974 1.0008 24.7706 22.5451 26.8710 24.6655 

450614 ............................................................................. *** * 18.5895 * * 18.5895 

450617 ............................................................................. 1.3959 1.0008 22.7514 25.2211 26.5026 24.9284 

450620 ............................................................................. 0.9943 0.8038 17.1333 18.1819 17.7138 17.6710 

450623 ............................................................................. 1.0833 0.9955 25.1400 28.3354 28.3552 27.2112 

450626 ............................................................................. 0.9113 0.8038 17.7454 21.4445 26.8375 21.3925 

450630 ............................................................................. 1.5237 1.0008 24.8096 27.8856 29.6796 27.5230 

450631 ............................................................................. *** * 22.8637 24.5409 * 23.7681 

450634 ............................................................................. 1.5840 1.0226 24.8258 27.0412 28.1705 26.8022 

450638 ............................................................................. 1.5909 1.0008 26.3653 29.5385 29.6184 28.6129 

450639 ............................................................................. 1.5269 0.9955 24.2919 27.3593 29.2669 27.0735 

450641 ............................................................................. 0.9690 0.8038 17.4072 17.0805 17.5845 17.3565 

450643 ............................................................................. 1.3272 0.8101 20.2000 20.9674 21.1205 20.7972 

450644 ............................................................................. 1.4121 1.0008 24.4574 27.2047 29.0186 27.0517 

450646 ............................................................................. 1.3665 0.8954 21.8500 22.6541 23.8908 22.8626 

450647 ............................................................................. 1.8080 1.0226 26.8276 28.8881 30.7334 28.8704 

450648 ............................................................................. 0.9048 0.8038 17.3678 18.2826 * 17.7872 

450649 ............................................................................. 0.9413 0.8038 17.5761 18.1118 * 17.8381 

450651 ............................................................................. 1.6207 1.0226 26.9215 28.9829 32.4822 29.5833 

450653 ............................................................................. 1.1208 0.9317 22.7236 21.8654 23.2603 22.6099 

450654 ............................................................................. 0.9014 0.8038 16.3057 19.6054 19.9992 18.6631 

450656 ............................................................................. 1.3925 0.9164 20.7824 22.7284 23.8280 22.4984 

450658 ............................................................................. 0.9005 0.8038 19.6855 19.9597 20.5398 20.0788 

450659 ............................................................................. 1.4288 1.0008 26.0224 28.8671 30.1727 28.5108 

450661 ............................................................................. 1.1620 0.9893 20.0716 21.5537 23.2989 21.6941 

450662 ............................................................................. 1.5437 0.9853 26.3794 24.5815 28.0913 26.3697 

450665 ............................................................................. 0.8590 0.8038 15.8571 17.2566 18.6054 17.2495 

450668 ............................................................................. 1.5024 0.8954 24.0081 26.4508 26.2375 25.5681 

450669 ............................................................................. 1.2076 1.0226 25.0200 25.6411 27.4677 26.1106 

450670 ............................................................................. 1.3351 1.0008 19.9621 22.0495 25.1575 22.3620 

450672 ............................................................................. 1.6955 0.9955 25.3106 26.7785 27.6359 26.6135 

450673 ............................................................................. 1.0764 0.8327 16.3319 19.4030 * 17.7858 

450674 ............................................................................. 0.9403 1.0008 24.8137 26.8081 * 25.8948 

450675 ............................................................................. 1.4122 0.9955 24.8661 26.1555 28.7765 26.7882 

450677 ............................................................................. 1.3184 0.9955 22.9529 24.0218 28.4544 25.1326 

450678 ............................................................................. 1.3836 1.0226 28.1917 30.1134 30.1500 29.5324 

450683 ............................................................................. 1.1313 1.0226 24.5013 24.0080 24.6609 24.3870 

450684 ............................................................................. 1.2141 1.0008 23.8945 26.2906 27.6789 25.9648 

450686 ............................................................................. 1.6245 0.8790 17.9181 21.0565 23.2367 20.7924 

450688 ............................................................................. 1.1771 1.0226 21.7922 23.7796 27.9057 24.4771 

450690 ............................................................................. 1.4853 0.9322 33.1576 28.7529 28.0400 29.1149 

450694 ............................................................................. 1.0990 1.0008 21.4784 22.3081 23.5790 22.4747 

450697 ............................................................................. 1.3237 0.8987 20.8951 21.2662 23.7155 22.0489 

450698 ............................................................................. 0.8758 0.8038 18.1764 18.5436 18.6494 18.4560 

450700 ............................................................................. 0.9198 0.8038 17.3458 18.6373 18.4602 18.1609 

450702 ............................................................................. 1.5061 0.8741 22.2953 24.8628 25.6147 24.3137 

450709 ............................................................................. 1.2645 1.0008 23.4246 25.0932 25.4855 24.7135 

450711 ............................................................................. 1.6067 0.8945 22.1489 24.8277 28.0104 25.1428 

450712 ............................................................................. *** * 18.4547 * * 18.4547 

450715 ............................................................................. 1.2343 1.0226 * 16.1897 28.0365 20.5948 

450716 ............................................................................. 1.2179 1.0008 24.8614 28.8043 30.8440 28.2641 

450718 ............................................................................. 1.1954 0.9451 24.9162 27.6672 27.3408 26.7229 

450723 ............................................................................. 1.3817 1.0226 24.1618 27.0055 28.0812 26.5571 

450724 ............................................................................. *** * 21.9630 * * 21.9630 

450730 ............................................................................. 1.2563 1.0226 27.8476 30.7567 29.9430 29.5510 

450733 ............................................................................. *** * 23.8143 25.5624 26.4976 25.4115 

450742 ............................................................................. 1.1492 1.0226 25.1295 26.3414 26.1190 25.8920 

450743 ............................................................................. 1.4553 1.0226 23.7424 24.7397 27.3213 25.3404 

450746 ............................................................................. 0.9449 0.8038 11.1672 16.9209 12.4748 13.1222 

450747 ............................................................................. 1.1996 0.9955 21.5883 24.2674 22.2870 22.7471 

450749 ............................................................................. 1.0081 0.8038 17.8696 18.4095 17.8227 18.0184 

23538 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

TABLE 2.—HOSPITAL CASE-MIX INDEXES FOR DISCHARGES OCCURRING IN FEDERAL FISCAL YEAR 2004; HOSPITAL AVERAGE HOURLY WAGE FOR FEDERAL FISCAL YEARS 2004 (2000 WAGE DATA), 2005 (2001 WAGE DATA), AND 2006 

(2002 WAGE DATA) WAGE INDEXES AND 3-YEAR AVERAGE OF HOSPITAL AVERAGE HOURLY WAGES—Continued 

Provider number Case-mix 

index 

Wage index 

FY 2006 

Average 

hourly wage 

FY 2004 

Average 

hourly wage 

FY 2005 

Average 

hourly wage 

FY 2006 

Average 

hourly 

wage ** 

(3 years) 

450751 ............................................................................. 1.2551 0.8293 23.3154 22.9070 19.3265 21.7472 

450754 ............................................................................. 0.9215 0.8038 19.2827 21.3043 20.8968 20.5167 

450755 ............................................................................. 0.9643 0.8790 19.2768 19.5168 18.0092 18.8178 

450758 ............................................................................. 1.2430 1.0226 22.8713 24.0226 25.6548 24.1232 

450760 ............................................................................. 1.1495 0.8954 23.2959 25.7453 24.6349 24.3909 

450761 ............................................................................. 0.8380 0.8038 15.5151 16.2605 15.7483 15.8642 

450763 ............................................................................. 1.1245 0.8038 19.8939 21.4171 22.4905 21.2790 

450766 ............................................................................. 1.8603 1.0226 27.2499 28.8576 30.0441 28.7197 

450770 ............................................................................. 1.1786 0.9451 19.9412 20.1763 20.3656 20.1550 

450771 ............................................................................. 1.6492 1.0226 25.0490 26.0618 31.3924 27.9152 

450774 ............................................................................. 1.7122 1.0008 21.7906 24.8562 24.9683 23.8170 

450775 ............................................................................. 1.1967 1.0008 23.6621 25.3924 24.4006 24.5023 

450776 ............................................................................. 0.9653 0.8038 14.6695 * * 14.6695 

450780 ............................................................................. 1.9234 0.8987 21.9046 22.8688 23.9516 22.9443 

450788 ............................................................................. 1.5485 0.8557 21.4467 24.2643 25.4172 23.7014 

450795 ............................................................................. 1.1361 1.0008 19.1371 28.1448 23.7510 23.4235 

450796 ............................................................................. 2.1587 0.9165 22.4973 24.7564 27.9734 25.1133 

450797 ............................................................................. *** 1.0008 18.6839 23.8708 20.5379 20.9547 

450801 ............................................................................. 1.4873 0.8293 19.7790 22.2426 23.0373 21.7315 

450803 ............................................................................. 1.2163 1.0008 23.8343 26.3054 30.6093 27.0662 

450804 ............................................................................. 1.8040 1.0008 22.8275 26.0003 26.0980 25.0247 

450808 ............................................................................. 1.6335 0.9451 18.6555 22.8247 23.8067 21.6597 

450809 ............................................................................. 1.5600 0.9451 23.8758 24.7763 26.3659 25.0664 

450811 ............................................................................. 1.8007 0.8945 22.7583 23.1022 25.8491 24.4306 

450813 ............................................................................. 1.1082 0.8038 21.7208 22.1326 25.5949 23.1456 

450817 ............................................................................. *** * 28.4441 * * 28.4441 

450822 ............................................................................. 1.1421 1.0226 26.7821 29.7067 31.1431 29.3455 

450824 ............................................................................. 2.3620 0.9451 24.5885 * 26.7803 25.7897 

450825 ............................................................................. 1.4475 0.8945 18.8510 18.7069 20.2959 19.3490 

450827 ............................................................................. 1.4188 0.8327 29.5838 21.1788 20.9704 23.0851 

450828 ............................................................................. 1.1739 0.8038 20.9509 21.4128 22.3667 21.5956 

450829 ............................................................................. *** 0.8987 14.4463 18.2860 19.5014 17.2726 

450830 ............................................................................. 0.9282 0.9593 24.7834 26.9917 28.1617 26.6450 

450831 ............................................................................. 1.6369 1.0008 * 20.0581 22.7885 21.7038 

450832 ............................................................................. 1.1025 1.0008 24.8572 26.4725 26.6628 26.1075 

450833 ............................................................................. 1.1371 1.0226 18.3196 26.1256 26.0044 23.5951 

450834 ............................................................................. 1.3563 0.8911 21.7217 22.7691 21.2204 21.8968 

450835 ............................................................................. *** * 24.8374 * * 24.8374 

450838 ............................................................................. 1.1289 0.8038 * 15.0454 15.8026 15.4717 

450839 ............................................................................. 0.9271 0.8767 * 21.1905 22.9711 22.0566 

450840 ............................................................................. 0.9946 1.0226 * 29.5215 31.1914 30.4233 

450841 ............................................................................. 1.6236 0.9853 * 17.6635 18.9468 18.3289 

450842 ............................................................................. *** * * 23.0945 * 23.0945 

450844 ............................................................................. 1.2573 1.0008 * 34.4235 28.7296 30.4450 

450845 ............................................................................. 1.8144 0.8954 * 26.5040 27.7461 27.1743 

450846 ............................................................................. *** * * 24.0791 * 24.0791 

450847 ............................................................................. 1.1792 1.0008 * 26.8892 27.6854 27.3036 

450848 ............................................................................. 1.1875 1.0008 * 26.5609 27.8100 27.1855 

450850 ............................................................................. 1.4887 0.9522 * * 22.1334 22.1334 

450851 ............................................................................. 2.2455 1.0226 * * 30.1213 30.1213 

450852 ............................................................................. *** 1.0226 * * 30.0191 30.0191 

460001 ............................................................................. 1.8903 0.9578 24.8844 25.6932 27.0757 25.8934 

460003 ............................................................................. 1.4892 0.9436 26.5141 24.3527 26.1372 25.6304 

460004 ............................................................................. 1.6546 0.9436 24.3409 25.2191 26.4498 25.3907 

460005 ............................................................................. 1.4234 0.9436 25.0063 22.6809 23.5633 23.6783 

460006 ............................................................................. 1.2864 0.9436 23.4200 24.4350 25.4787 24.4752 

460007 ............................................................................. 1.3119 0.9416 23.3603 24.2875 25.6686 24.4644 

460008 ............................................................................. 1.3319 0.9436 24.8233 24.4453 26.5672 25.2587 

460009 ............................................................................. 1.9172 0.9436 24.5865 25.0984 26.2833 25.3688 

460010 ............................................................................. 2.0750 0.9436 25.1240 26.2331 27.4648 26.2912 

460011 ............................................................................. 1.2723 0.9578 21.2634 22.3601 23.4023 22.3027 

460013 ............................................................................. 1.3340 0.9578 23.1467 23.4765 25.2448 23.9897 

460014 ............................................................................. 1.0825 0.9436 22.6125 23.9400 24.5384 23.7842 

460015 ............................................................................. 1.2767 0.9183 23.1068 24.0939 25.6576 24.3035 

460016 ............................................................................. *** 0.8134 18.7453 * * 18.7453 

460018 h ........................................................................... 0.8785 1.2094 16.7143 18.8942 20.3755 18.6334 

460019 ............................................................................. 1.0897 0.8134 18.1995 20.3625 19.9900 19.5496 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23539 

TABLE 2.—HOSPITAL CASE-MIX INDEXES FOR DISCHARGES OCCURRING IN FEDERAL FISCAL YEAR 2004; HOSPITAL AVERAGE HOURLY WAGE FOR FEDERAL FISCAL YEARS 2004 (2000 WAGE DATA), 2005 (2001 WAGE DATA), AND 2006 

(2002 WAGE DATA) WAGE INDEXES AND 3-YEAR AVERAGE OF HOSPITAL AVERAGE HOURLY WAGES—Continued 

Provider number Case-mix 

index 

Wage index 

FY 2006 

Average 

hourly wage 

FY 2004 

Average 

hourly wage 

FY 2005 

Average 

hourly wage 

FY 2006 

Average 

hourly 

wage ** 

(3 years) 

460020 ............................................................................. 1.0465 0.8134 15.2162 19.4960 19.5669 17.9384 

460021 ............................................................................. 1.6825 1.1249 23.8565 24.9725 26.3420 25.1139 

460023 ............................................................................. 1.1620 0.9578 25.0874 25.0376 25.3094 25.1556 

460025 ............................................................................. 0.9769 0.8134 22.3098 18.7978 * 20.4201 

460026 ............................................................................. 0.9752 0.8134 21.9316 22.7589 24.1547 22.9505 

460029 ............................................................................. 1.0584 0.8134 24.4379 * * 24.4379 

460032 ............................................................................. 0.9659 0.9578 21.2715 22.8987 * 22.1308 

460033 ............................................................................. 0.9161 0.8134 21.7216 22.7816 22.0248 22.1909 

460035 ............................................................................. 0.9171 0.8134 16.9657 16.9019 17.5723 17.1694 

460036 ............................................................................. 1.2351 0.9578 23.9910 25.2647 27.2865 25.5949 

460037 ............................................................................. 0.8624 0.8134 20.0323 19.8478 21.1035 20.3240 

460039 ............................................................................. 1.0000 0.9048 26.3795 27.5912 28.5656 27.5288 

460041 ............................................................................. 1.3167 0.9436 23.5132 24.0431 25.2744 24.2809 

460042 ............................................................................. 1.3210 0.9436 22.0844 23.5819 22.9949 22.8865 

460043 ............................................................................. 0.9066 0.9578 26.0277 26.6870 28.2089 27.0296 

460044 ............................................................................. 1.2356 0.9436 24.7138 25.7342 26.6795 25.7463 

460047 ............................................................................. 1.6135 0.9436 24.9214 25.1721 25.7920 25.3219 

460049 ............................................................................. 1.9769 0.9436 21.9357 23.0683 24.5164 23.1856 

460051 ............................................................................. 1.1333 0.9436 22.7540 23.4970 25.5881 24.0241 

460052 ............................................................................. 1.4446 0.9578 23.1717 24.0797 25.3163 24.2177 

460053 ............................................................................. *** * 23.2274 * * 23.2274 

470001 ............................................................................. 1.2123 1.0668 23.5882 24.5499 27.7329 25.2768 

470003 ............................................................................. 1.8981 1.0199 24.1739 24.6660 26.4919 25.1321 

470005 ............................................................................. 1.3303 1.0199 24.9625 25.7288 29.8255 26.8311 

470006 ............................................................................. 1.1851 1.0199 21.6036 26.0884 26.9651 24.9417 

470008 ............................................................................. 1.1624 1.0199 20.7659 21.8951 * 21.3386 

470010 ............................................................................. 1.1493 1.0199 23.2072 22.9777 26.1273 24.1019 

470011 ............................................................................. 1.2027 1.0903 24.6034 25.9246 28.3911 26.3395 

470012 ............................................................................. 1.2167 1.0199 20.5072 22.9159 24.3425 22.6924 

470018 ............................................................................. 1.1669 1.0199 21.2904 25.9300 28.3419 25.0848 

470023 ............................................................................. 1.2183 1.0199 24.1395 26.7486 * 25.4614 

470024 ............................................................................. 1.1449 1.0199 22.4659 23.7745 25.8652 24.1048 

490001 ............................................................................. 1.0907 0.8024 22.3622 21.7111 21.9953 22.0191 

490002 ............................................................................. 1.0623 0.8024 17.5098 18.5220 19.5613 18.6066 

490003 ............................................................................. *** * 20.9783 23.8112 27.3456 23.8351 

490004 ............................................................................. 1.2757 0.9806 22.7154 24.4580 25.4597 24.2345 

490005 ............................................................................. 1.6453 1.0813 25.2213 27.6425 28.5744 27.1963 

490006 ............................................................................. 1.1847 1.0214 13.4277 16.7679 * 15.2211 

490007 ............................................................................. 2.2466 0.8841 22.2526 24.9533 26.2481 24.5292 

490009 ............................................................................. 1.9263 1.0230 25.2181 27.5905 29.1962 27.2686 

490011 ............................................................................. 1.4460 0.8841 20.0136 22.4410 24.5687 22.4266 

490012 ............................................................................. 0.9964 0.8024 15.8346 18.3697 19.2275 17.8014 

490013 ............................................................................. 1.2634 0.8596 19.5094 21.4838 22.2736 21.0913 

490015 ............................................................................. *** * 21.2557 22.5641 * 21.9516 

490017 ............................................................................. 1.3989 0.8841 20.7691 22.9632 24.6845 22.9273 

490018 ............................................................................. 1.2537 0.9806 22.0810 23.2215 24.5196 23.2792 

490019 h ........................................................................... 1.1521 1.0935 23.3077 24.4524 25.9761 24.6213 

490020 ............................................................................. 1.2668 0.9319 21.2094 23.6611 24.8001 23.2943 

490021 ............................................................................. 1.4407 0.8706 22.2537 23.5930 24.6440 23.5199 

490022 ............................................................................. 1.4865 1.0935 24.4682 25.0277 28.0749 25.8811 

490023 ............................................................................. 1.2256 1.0935 24.9734 28.8354 29.7774 27.9947 

490024 ............................................................................. 1.6758 0.8450 21.2619 21.7268 23.0982 22.0522 

490027 ............................................................................. 1.1416 0.8024 20.3644 19.8345 18.9409 19.7128 

490031 ............................................................................. 1.1051 0.8024 18.4826 22.4300 22.0579 20.9706 

490032 ............................................................................. 1.8812 0.9319 23.6489 22.8942 25.1381 23.9005 

490033 ............................................................................. 1.0518 1.0935 24.4370 27.6355 30.0909 27.5418 

490037 ............................................................................. 1.1577 0.8024 17.5104 19.0583 21.3035 19.2834 

490038 ............................................................................. 1.1503 0.8024 18.1405 19.6427 22.1374 19.9691 

490040 ............................................................................. 1.5115 1.0935 27.0513 30.1820 32.8738 30.0780 

490041 ............................................................................. 1.4077 0.8841 19.9314 22.2955 24.5738 22.3542 

490042 ............................................................................. 1.2563 0.8024 19.5127 20.5845 21.8749 20.7701 

490043 ............................................................................. 1.1666 1.0935 25.4354 28.2969 30.8871 28.4640 

490044 ............................................................................. 1.3756 0.8841 20.8739 22.1324 20.8351 21.2628 

490045 ............................................................................. 1.3043 1.0935 24.7131 27.2132 28.8279 27.0743 

490046 ............................................................................. 1.5526 0.8841 22.0040 24.6391 25.6328 24.1719 

490047 ............................................................................. 1.0113 0.8998 19.8220 21.9156 22.5424 21.3597 

490048 ............................................................................. 1.4287 0.8450 22.3138 24.1639 25.0097 23.8716 

23540 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

TABLE 2.—HOSPITAL CASE-MIX INDEXES FOR DISCHARGES OCCURRING IN FEDERAL FISCAL YEAR 2004; HOSPITAL AVERAGE HOURLY WAGE FOR FEDERAL FISCAL YEARS 2004 (2000 WAGE DATA), 2005 (2001 WAGE DATA), AND 2006 

(2002 WAGE DATA) WAGE INDEXES AND 3-YEAR AVERAGE OF HOSPITAL AVERAGE HOURLY WAGES—Continued 

Provider number Case-mix 

index 

Wage index 

FY 2006 

Average 

hourly wage 

FY 2004 

Average 

hourly wage 

FY 2005 

Average 

hourly wage 

FY 2006 

Average 

hourly 

wage ** 

(3 years) 

490050 ............................................................................. 1.5254 1.0935 26.1521 29.4660 30.5037 28.7334 

490052 ............................................................................. 1.6709 0.8841 19.2480 21.4035 22.8889 21.2086 

490053 ............................................................................. 1.2926 0.8095 18.6541 20.9367 21.8432 20.4783 

490057 ............................................................................. 1.5826 0.8841 22.1612 25.1898 26.1128 24.5153 

490059 ............................................................................. 1.5692 0.9319 23.3895 26.1518 28.7276 26.1974 

490060 ............................................................................. 1.0283 0.8024 20.6028 21.0828 22.4200 21.3908 

490063 ............................................................................. 1.8332 1.0935 31.0162 29.4216 30.3648 30.2236 

490066 ............................................................................. 1.3174 0.8841 22.1034 23.3835 24.7146 23.4575 

490067 ............................................................................. 1.1859 0.9319 20.4058 21.8730 22.9188 21.7183 

490069 ............................................................................. 1.5306 0.9319 20.6957 24.4542 26.8791 24.1400 

490071 ............................................................................. 1.2929 0.9319 25.4678 27.0374 28.4381 27.0687 

490073 ............................................................................. 1.6276 1.0935 27.6711 25.2859 31.7743 27.8898 

490075 ............................................................................. 1.4205 0.8514 22.3230 22.8303 23.8191 23.0000 

490077 ............................................................................. 1.3109 1.0230 22.2643 24.8309 26.0800 24.4773 

490079 ............................................................................. 1.2705 0.9020 19.2196 19.8100 23.4728 20.7435 

490084 ............................................................................. 1.1954 0.8024 19.8598 22.7945 24.6045 22.3588 

490088 ............................................................................. 1.0683 0.8706 19.7549 21.4818 22.4186 21.1984 

490089 ............................................................................. 1.0461 0.8450 21.1522 21.2123 22.6461 21.7546 

490090 ............................................................................. 1.1132 0.8024 20.3015 21.3410 22.2907 21.2854 

490092 ............................................................................. 1.1103 0.9319 23.8364 21.6466 23.8656 23.0587 

490093 ............................................................................. 1.4305 0.8841 20.7388 23.6779 25.0751 23.2941 

490094 ............................................................................. 0.9993 0.9319 21.9886 26.0755 26.5726 25.0296 

490097 ............................................................................. 1.0181 0.8024 18.1022 23.5366 23.8005 21.5573 

490098 ............................................................................. 1.2311 0.8024 19.7116 20.9805 21.7231 20.8214 

490101 ............................................................................. 1.2761 1.0935 28.5200 30.1800 30.4285 29.7644 

490104 ............................................................................. 0.7943 0.9319 28.0286 33.1215 17.3295 24.4559 

490105 ............................................................................. 0.7131 0.8095 40.6821 38.2813 24.7923 34.3492 

490106 ............................................................................. 0.9458 0.9806 31.6541 30.1492 23.0199 28.3157 

490107 ............................................................................. 1.2758 1.0935 26.5312 28.7296 29.7000 28.3786 

490108 ............................................................................. 0.9611 0.8706 28.7277 27.9090 22.4345 26.3471 

490109 ............................................................................. 0.9766 0.9319 28.0978 28.0548 21.9878 25.9914 

490110 ............................................................................. 1.3198 0.8024 23.6080 21.3126 22.5974 22.4319 

490111 ............................................................................. 1.2838 0.8024 19.4041 20.6373 22.0199 20.6805 

490112 ............................................................................. 1.6692 0.9319 23.6028 25.8312 26.6453 25.4222 

490113 ............................................................................. 1.2540 1.0935 28.0893 29.1786 29.5698 28.9669 

490114 ............................................................................. 0.9717 0.8024 19.9725 20.0555 20.7017 20.2462 

490115 ............................................................................. 1.1772 0.8024 19.9151 20.3615 21.4666 20.5969 

490116 ............................................................................. 1.1327 0.8024 19.7007 21.3083 22.9017 21.2429 

490117 ............................................................................. 1.1880 0.8024 15.6078 17.4111 18.0277 17.0302 

490118 ............................................................................. 1.7046 0.9319 25.2230 26.8810 27.4050 26.6600 

490119 ............................................................................. 1.3161 0.8841 21.3883 23.7813 25.2549 23.5234 

490120 ............................................................................. 1.3813 0.8841 22.2389 23.1535 24.4434 23.3020 

490122 ............................................................................. 1.4487 1.0935 27.3509 28.7020 31.0449 29.0227 

490123 ............................................................................. 1.0953 0.8024 20.9506 22.9511 23.9233 22.6075 

490124 ............................................................................. *** * 21.3713 29.7939 * 25.7258 

490126 ............................................................................. 1.2378 0.8024 20.4660 23.1423 22.2859 21.9403 

490127 ............................................................................. 1.0786 0.8024 17.8070 19.4005 20.4289 19.2585 

490130 ............................................................................. 1.3182 0.8841 18.6038 22.0769 22.8512 21.1640 

490132 ............................................................................. *** 0.8024 19.5849 * * 19.5849 

500001 ............................................................................. 1.5872 1.1573 26.6420 26.7502 29.3707 27.5939 

500002 ............................................................................. 1.4024 1.0459 24.0374 25.0665 25.3347 24.8482 

500003 ............................................................................. 1.2634 1.1573 27.3435 28.4174 29.6341 28.5098 

500005 ............................................................................. 1.8137 1.1573 28.9512 31.4415 32.0972 30.7955 

500007 ............................................................................. 1.2933 1.0459 23.5774 26.1318 28.0476 25.9648 

500008 ............................................................................. 1.9138 1.1573 28.9380 31.0128 31.8837 30.6288 

500011 ............................................................................. 1.3458 1.1573 27.6762 28.3391 30.6508 28.9502 

500012 ............................................................................. 1.5792 1.0459 26.2263 29.2045 30.6856 28.7227 

500014 ............................................................................. 1.6444 1.1573 27.4248 30.1061 33.7536 30.6058 

500015 ............................................................................. 1.3785 1.1573 27.3397 30.1596 32.0592 29.8941 

500016 ............................................................................. 1.6460 1.1573 27.7863 29.3634 31.4221 29.6282 

500019 ............................................................................. 1.2688 1.0459 25.7691 26.9702 28.6669 27.1697 

500021 ............................................................................. 1.3005 1.0794 26.4648 28.5926 30.1690 28.5893 

500023 ............................................................................. 1.1295 1.0459 23.9513 27.3823 * 25.6872 

500024 ............................................................................. 1.6961 1.0794 27.2967 29.3946 30.7917 29.1683 

500025 ............................................................................. 1.7523 1.1573 29.0400 31.7335 34.7252 31.7861 

500026 ............................................................................. 1.4441 1.1573 28.7532 31.4152 33.2937 31.1325 

500027 ............................................................................. 1.5647 1.1573 30.6901 29.5939 34.2175 31.5063 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23541 

TABLE 2.—HOSPITAL CASE-MIX INDEXES FOR DISCHARGES OCCURRING IN FEDERAL FISCAL YEAR 2004; HOSPITAL AVERAGE HOURLY WAGE FOR FEDERAL FISCAL YEARS 2004 (2000 WAGE DATA), 2005 (2001 WAGE DATA), AND 2006 

(2002 WAGE DATA) WAGE INDEXES AND 3-YEAR AVERAGE OF HOSPITAL AVERAGE HOURLY WAGES—Continued 

Provider number Case-mix 

index 

Wage index 

FY 2006 

Average 

hourly wage 

FY 2004 

Average 

hourly wage 

FY 2005 

Average 

hourly wage 

FY 2006 

Average 

hourly 

wage ** 

(3 years) 

500030 ............................................................................. 1.5791 1.1705 29.0487 30.5926 32.7446 30.8324 

500031 ............................................................................. 1.1888 1.0970 26.0740 28.5398 31.2186 28.5887 

500033 ............................................................................. 1.2976 1.0459 25.4345 26.6704 29.4627 27.2338 

500036 ............................................................................. 1.3747 1.0459 25.4753 26.0223 27.0072 26.1929 

500037 ............................................................................. 1.0310 1.0459 23.5414 24.6548 26.9969 25.0377 

500039 ............................................................................. 1.4511 1.1573 26.1409 27.9651 29.8809 28.0919 

500041 ............................................................................. 1.2975 1.1229 24.9004 26.9101 26.5976 26.1814 

500044 ............................................................................. 1.9843 1.0898 27.0880 26.9323 30.3164 28.1645 

500049 ............................................................................. 1.3010 1.0459 26.6407 25.6104 27.1819 26.4960 

500050 ............................................................................. 1.4422 1.1229 25.0907 26.8971 29.9791 27.4347 

500051 ............................................................................. 1.7552 1.1573 26.9538 29.0100 31.9406 29.4441 

500053 ............................................................................. 1.2441 1.0619 26.0112 26.8074 28.4130 27.1467 

500054 ............................................................................. 2.0525 1.0898 27.1965 28.8062 30.8067 28.9786 

500055 ............................................................................. *** 1.0459 25.3095 * * 25.3095 

500058 ............................................................................. 1.6605 1.0619 27.3411 28.4247 30.4699 28.8635 

500060 ............................................................................. 1.2823 1.1573 31.7480 33.5169 34.1523 33.1768 

500064 ............................................................................. 1.7416 1.1573 29.2539 31.1459 31.5371 30.6791 

500065 ............................................................................. 1.2445 1.0459 26.5880 26.0960 * 26.3295 

500071 ............................................................................. 1.1734 1.0459 23.2071 * * 23.2071 

500074 ............................................................................. *** 1.0459 21.9019 * * 21.9019 

500079 ............................................................................. 1.3420 1.0794 27.1775 28.4934 29.6623 28.4444 

500084 ............................................................................. 1.3103 1.1573 26.5864 27.6306 29.3484 27.9397 

500086 ............................................................................. 1.2807 1.0459 25.9705 * * 25.9705 

500092 ............................................................................. 0.8995 1.0459 20.8601 23.2466 * 22.0417 

500104 ............................................................................. 1.0691 1.1573 26.8007 27.0034 * 26.9067 

500108 ............................................................................. 1.6596 1.0794 27.4156 28.7206 29.4244 28.5667 

500110 ............................................................................. 1.1857 1.0459 24.8448 25.4785 26.4560 25.6025 

500118 ............................................................................. 1.1171 1.0459 26.1971 28.1074 * 27.1693 

500119 ............................................................................. 1.3607 1.0898 25.1576 27.2335 30.9999 27.7928 

500122 ............................................................................. 1.1916 1.0459 26.9006 27.4405 30.1396 28.2069 

500124 ............................................................................. 1.4090 1.1573 24.8357 28.6598 31.5438 28.2647 

500129 ............................................................................. 1.5325 1.0794 27.8351 30.0223 30.7536 29.5772 

500134 ............................................................................. 0.4749 1.1573 21.3921 24.2990 26.8608 24.3808 

500139 ............................................................................. 1.5310 1.0794 27.7281 29.2357 31.6591 29.5383 

500141 ............................................................................. 1.2664 1.1573 28.2968 30.7478 30.5456 29.9289 

500143 ............................................................................. 0.4570 1.0794 19.0982 20.7093 22.1419 20.7552 

500147 ............................................................................. 0.8043 1.0459 * 16.3669 24.5807 16.9814 

500148 ............................................................................. 1.1051 1.0459 * 18.2168 22.2161 20.0814 

510001 ............................................................................. 1.9174 0.8840 21.4247 22.9351 23.4477 22.6536 

510002 ............................................................................. 1.1623 0.8450 20.9822 22.4751 25.9597 23.1031 

510006 ............................................................................. 1.2491 0.8840 21.0214 22.2947 23.5727 22.3142 

510007 ............................................................................. 1.5458 0.9482 23.4411 24.3499 25.2835 24.3672 

510008 ............................................................................. 1.1920 0.9528 22.7595 24.5293 24.6959 24.0287 

510012 ............................................................................. 0.9435 0.7742 16.7710 18.5816 18.2845 17.8391 

510013 ............................................................................. 1.1671 0.7742 19.7937 19.9710 20.8782 20.2065 

510015 ............................................................................. 0.9561 0.8429 17.9040 * * 17.9040 

510022 ............................................................................. 1.8301 0.8429 22.7534 24.1481 24.2125 23.7112 

510023 ............................................................................. 1.2510 0.7821 17.9267 19.4321 20.4908 19.2664 

510024 ............................................................................. 1.7224 0.8840 21.3662 23.3115 24.0444 22.9061 

510026 ............................................................................. 1.0110 0.7742 16.5389 18.0855 16.6192 17.0257 

510028 ............................................................................. 0.9965 0.8274 24.6544 23.0518 21.7134 23.1596 

510029 ............................................................................. 1.2527 0.8429 19.8202 21.7527 22.0060 21.2311 

510030 ............................................................................. 1.1843 0.8332 19.8220 22.3658 21.5583 21.2766 

510031 ............................................................................. 1.3895 0.8429 20.5743 21.6294 21.7637 21.3498 

510033 ............................................................................. 1.3921 0.8303 19.6921 21.0707 23.0305 21.2329 

510038 ............................................................................. 1.0245 0.7742 16.1016 16.8744 17.2832 16.7659 

510039 ............................................................................. 1.2658 0.7742 17.6173 19.1280 19.5468 18.7692 

510043 ............................................................................. 0.8986 0.7742 15.5857 16.0586 * 15.8328 

510046 ............................................................................. 1.2834 0.8274 19.2802 21.2792 21.2540 20.5978 

510047 ............................................................................. 1.1340 0.8840 22.1953 23.2093 24.0954 23.1668 

510048 ............................................................................. 1.1071 0.7742 16.3761 17.6785 17.5096 17.1529 

510050 ............................................................................. 1.5329 0.7742 18.9990 20.1943 19.9766 19.7250 

510053 ............................................................................. 1.1350 0.7742 18.1054 20.7538 20.8609 19.9625 

510055 ............................................................................. 1.4505 0.9482 27.7422 29.3962 30.7868 29.3287 

510058 ............................................................................. 1.2970 0.8303 20.1104 21.9352 22.6976 21.6021 

510059 ............................................................................. 0.6811 0.8429 18.1543 18.8712 21.9550 19.5138 

510061 ............................................................................. 0.9818 0.9310 14.8848 15.3355 * 15.1074 

23542 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

TABLE 2.—HOSPITAL CASE-MIX INDEXES FOR DISCHARGES OCCURRING IN FEDERAL FISCAL YEAR 2004; HOSPITAL AVERAGE HOURLY WAGE FOR FEDERAL FISCAL YEARS 2004 (2000 WAGE DATA), 2005 (2001 WAGE DATA), AND 2006 

(2002 WAGE DATA) WAGE INDEXES AND 3-YEAR AVERAGE OF HOSPITAL AVERAGE HOURLY WAGES—Continued 

Provider number Case-mix 

index 

Wage index 

FY 2006 

Average 

hourly wage 

FY 2004 

Average 

hourly wage 

FY 2005 

Average 

hourly wage 

FY 2006 

Average 

hourly 

wage ** 

(3 years) 

510062 ............................................................................. 1.1655 0.7742 21.3405 21.1568 23.3216 21.9387 

510067 ............................................................................. 1.1669 0.7742 18.0113 22.1582 21.2099 20.4433 

510068 ............................................................................. 1.1126 1.0935 19.9056 20.0007 23.1011 21.0310 

510070 ............................................................................. 1.1882 0.8274 20.0974 21.1895 23.2382 21.5724 

510071 ............................................................................. 1.2853 0.8274 19.4029 21.5439 23.1685 21.4107 

510072 ............................................................................. 1.0629 0.7742 18.4566 19.7990 20.1997 19.5568 

510077 ............................................................................. 1.1621 0.9119 20.9153 22.8104 23.6585 22.4770 

510082 ............................................................................. 1.1043 0.7742 17.2891 16.4742 19.1878 17.5963 

510085 ............................................................................. 1.2020 0.8429 20.6364 22.6563 23.7173 22.3503 

510086 ............................................................................. 1.0874 0.7742 16.3051 17.8234 17.5933 17.2267 

510088 ............................................................................. 0.9820 0.7742 16.4373 18.3401 * 17.3534 

510089 ............................................................................. *** * * * 27.7062 27.7062 

520002 ............................................................................. 1.2821 0.9964 22.0838 23.7316 24.9950 23.6544 

520003 ............................................................................. 1.1724 0.9478 20.4234 21.8662 * 21.1608 

520004 ............................................................................. 1.3395 0.9557 22.8530 24.4711 25.4639 24.2888 

520008 ............................................................................. 1.5856 1.0111 26.0931 27.8127 29.8354 27.9737 

520009 ............................................................................. 1.6869 0.9478 21.5169 23.4265 26.1503 23.6455 

520010 ............................................................................. 1.1228 1.1055 26.3965 28.5569 29.2491 28.0349 

520011 ............................................................................. 1.2647 0.9478 22.7880 23.7785 25.2747 23.9992 

520013 ............................................................................. 1.3725 0.9478 23.1173 24.4766 26.6225 24.8211 

520014 ............................................................................. 1.0762 1.0629 20.4281 22.1064 * 21.2683 

520015 ............................................................................. 1.1411 .9478 22.8094 23.0403 * 22.9239 

520017 ............................................................................. 1.1442 0.9478 21.7542 23.4044 24.6676 23.3009 

520019 ............................................................................. 1.2709 0.9478 22.6895 24.9871 25.0377 24.2463 

520021 ............................................................................. 1.3765 1.0698 24.1284 25.4872 26.6935 25.4468 

520024 ............................................................................. 1.0697 0.9478 17.5368 18.5072 * 18.0423 

520026 ............................................................................. 1.0913 1.1055 25.0504 26.1056 * 25.6168 

520027 ............................................................................. 1.2710 1.0111 22.2089 26.2516 27.5490 25.5645 

520028 ............................................................................. 1.2544 1.0416 24.3592 25.7778 25.4164 25.1844 

520030 ............................................................................. 1.7713 0.9964 23.9474 25.3807 27.0185 25.5053 

520032 ............................................................................. 1.1260 1.0629 22.7220 25.3059 25.3696 24.4819 

520033 ............................................................................. 1.3031 0.9478 22.2650 23.9791 24.6125 23.6548 

520034 ............................................................................. 1.1362 0.9478 22.6160 23.6563 23.9850 23.4634 

520035 ............................................................................. 1.2757 0.9478 20.8563 23.2625 24.7767 23.0160 

520037 ............................................................................. 1.7957 0.9964 25.0587 28.6984 29.7234 27.8508 

520038 ............................................................................. 1.2023 1.0111 23.1036 24.6650 26.6470 24.8476 

520040 ............................................................................. 1.3551 1.0111 21.5671 23.8501 25.1096 23.5636 

520041 ............................................................................. 1.1069 1.0629 22.6216 22.8236 22.7596 22.7396 

520042 ............................................................................. 1.0666 0.9478 21.9935 24.0788 23.6326 23.2471 

520044 ............................................................................. 1.3206 0.9478 22.7627 24.9387 26.0191 24.5777 

520045 ............................................................................. 1.4958 0.9478 24.1624 24.5844 26.0030 24.9427 

520047 ............................................................................. 0.9463 0.9478 22.5686 25.5346 * 24.0011 

520048 ............................................................................. 1.6494 0.9478 20.5069 23.1653 25.1724 22.8848 

520049 ............................................................................. 2.1923 0.9478 22.7424 24.1083 25.9256 24.2130 

520051 ............................................................................. 1.6606 1.0111 27.6695 28.8249 28.3040 28.2799 

520057 ............................................................................. 1.1487 0.9478 21.2729 23.3205 25.3745 23.3399 

520058 ............................................................................. *** 1.0224 23.2907 * * 23.2907 

520060 ............................................................................. 1.3001 0.9478 21.1271 22.0132 23.8817 22.3382 

520062 ............................................................................. 1.2975 1.0111 23.7166 24.9988 28.2215 25.7059 

520063 ............................................................................. 1.1228 1.0111 23.3037 25.3674 27.4101 25.4095 

520064 ............................................................................. 1.4701 1.0111 24.3043 27.1120 28.6101 26.6968 

520066 ............................................................................. 1.5188 1.0416 23.9212 25.8812 27.1657 25.6782 

520068 ............................................................................. 0.8883 0.9478 21.4413 23.4746 24.8184 23.2981 

520069 ............................................................................. *** * 32.6484 * * 32.6484 

520071 ............................................................................. 1.2141 0.9957 23.4832 26.3154 27.6202 25.7950 

520075 ............................................................................. 1.5364 0.9478 23.7322 26.0600 27.1699 25.6758 

520076 ............................................................................. 1.1767 1.0416 22.2993 24.0879 26.1698 24.2625 

520078 ............................................................................. 1.4830 1.0111 23.4414 25.7662 27.5989 25.6772 

520083 ............................................................................. 1.7454 1.0629 25.7108 27.0012 28.8407 27.2481 

520084 ............................................................................. 1.0616 1.0629 24.7909 25.5777 * 25.1765 

520087 ............................................................................. 1.6953 0.9557 22.8974 24.5280 27.3374 24.8782 

520088 ............................................................................. 1.3362 0.9957 23.8938 26.0882 26.9936 25.7252 

520089 ............................................................................. 1.5475 1.0629 24.4435 26.6013 30.0448 27.0527 

520091 ............................................................................. 1.2659 0.9478 22.8914 24.8269 24.6320 24.0764 

520092 ............................................................................. 1.0263 0.9478 21.8662 23.4043 * 22.6433 

520094 ............................................................................. *** 0.9957 22.3925 25.3166 25.7567 24.5483 

520095 ............................................................................. 1.2045 1.0416 25.1402 28.6376 26.7863 26.8360 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23543 

TABLE 2.—HOSPITAL CASE-MIX INDEXES FOR DISCHARGES OCCURRING IN FEDERAL FISCAL YEAR 2004; HOSPITAL AVERAGE HOURLY WAGE FOR FEDERAL FISCAL YEARS 2004 (2000 WAGE DATA), 2005 (2001 WAGE DATA), AND 2006 

(2002 WAGE DATA) WAGE INDEXES AND 3-YEAR AVERAGE OF HOSPITAL AVERAGE HOURLY WAGES—Continued 

Provider number Case-mix 

index 

Wage index 

FY 2006 

Average 

hourly wage 

FY 2004 

Average 

hourly wage 

FY 2005 

Average 

hourly wage 

FY 2006 

Average 

hourly 

wage ** 

(3 years) 

520096 ............................................................................. 1.3205 0.9957 21.1759 22.9929 24.5758 22.9775 

520097 ............................................................................. 1.3919 0.9478 23.6512 25.1135 26.3321 25.1104 

520098 ............................................................................. 2.0001 1.0629 25.8184 28.0730 30.6150 28.2679 

520100 ............................................................................. 1.2767 0.9561 21.7072 24.5914 26.2161 24.1896 

520102 ............................................................................. 1.0905 0.9957 23.7739 25.6146 26.8234 25.4621 

520103 ............................................................................. 1.6066 1.0111 23.5984 25.5361 27.9147 25.8275 

520107 ............................................................................. 1.2224 0.9478 25.7379 27.7413 28.3431 27.2253 

520109 ............................................................................. 1.0371 0.9478 20.6357 22.4048 24.9379 22.6443 

520111 ............................................................................. *** * 26.9666 26.3095 * 26.6016 

520112 ............................................................................. 1.1078 0.9478 19.1409 20.4034 * 19.7623 

520113 ............................................................................. 1.2717 0.9478 24.0822 26.7926 27.4135 26.1479 

520114 ............................................................................. 1.1620 0.9478 21.9847 22.0536 * 22.0194 

520116 ............................................................................. 1.2099 0.9957 23.9066 26.3057 26.9902 25.8557 

520117 ............................................................................. 1.0283 0.9478 21.9915 22.0023 * 21.9973 

520123 ............................................................................. 1.0715 1.1055 21.2360 22.2430 * 21.7461 

520130 ............................................................................. *** 0.9478 20.0277 * * 20.0277 

520134 ............................................................................. *** 0.9478 20.8502 * * 20.8502 

520136 ............................................................................. 1.6003 1.0111 23.2573 25.5145 27.7703 25.5032 

520138 ............................................................................. 1.8350 1.0111 25.1434 26.9047 28.4394 26.8513 

520139 ............................................................................. 1.2505 1.0111 23.7727 25.4424 26.5110 25.3279 

520140 ............................................................................. 1.6615 1.0111 23.9176 26.1616 28.3001 26.0657 

520145 ............................................................................. *** * 25.0770 * * 25.0770 

520151 ............................................................................. 1.0251 0.9478 20.1995 22.9592 * 21.5728 

520152 ............................................................................. 1.0564 0.9478 22.5440 23.2493 24.9392 23.6620 

520154 ............................................................................. 1.1733 0.9478 23.2635 23.7160 * 23.4910 

520156 ............................................................................. 1.0529 1.1055 23.7157 24.9258 * 24.3330 

520160 ............................................................................. 1.8094 0.9478 22.9475 24.3528 25.7588 24.4208 

520161 ............................................................................. 0.9206 0.9478 22.1857 24.0673 * 23.1340 

520170 ............................................................................. 1.2905 1.0111 25.5470 25.6124 27.2221 26.1781 

520173 ............................................................................. 1.0948 1.0224 24.4723 26.2224 28.0995 26.3133 

520177 ............................................................................. 1.6337 1.0111 27.5560 28.4663 30.7317 29.0456 

520178 ............................................................................. 0.9691 0.9478 22.3193 23.0419 20.2666 21.8785 

520189 ............................................................................. 1.1063 1.0698 23.1658 26.3172 28.4720 26.3169 

520192 ............................................................................. *** * 22.5641 * * 22.5641 

520194 ............................................................................. 1.5971 * * * 24.9408 24.9408 

520195 ............................................................................. 0.3562 1.0111 * * 36.6973 36.6973 

520196 ............................................................................. 1.5022 0.9478 * * 35.1043 35.1043 

530002 ............................................................................. 1.1527 0.9207 23.8852 25.2983 26.8356 25.4030 

530004 ............................................................................. *** * 19.7857 * * 19.7857 

530007 ............................................................................. 1.2447 0.9207 22.3309 19.3476 20.4391 20.6774 

530008 2 ........................................................................... 1.2307 0.9207 21.8714 23.8271 23.8589 23.1777 

530009 ............................................................................. 0.9699 0.9207 22.0450 24.2426 26.8316 24.1997 

530010 2 ........................................................................... 1.2457 0.9207 21.4890 23.9255 25.8482 23.7290 

530011 ............................................................................. 1.0112 0.9207 22.5720 24.1396 24.8245 23.8464 

530012 ............................................................................. 1.6902 0.9207 22.4716 24.3454 25.2526 24.0014 

530014 ............................................................................. 1.6077 0.9207 21.7314 23.6907 24.5947 23.3995 

530015 ............................................................................. 1.2773 0.9207 25.3915 26.3107 27.6876 26.4934 

530016 ............................................................................. 1.3351 0.9207 21.0666 21.6575 * 21.3685 

530017 ............................................................................. 0.9556 0.9207 19.5630 23.5415 25.3362 22.8987 

530023 ............................................................................. 1.1558 0.9207 22.5535 24.1493 21.3813 22.6451 

530025 ............................................................................. 1.2781 1.0146 25.4693 27.7988 28.6938 27.3568 

530026 ............................................................................. *** 0.9207 21.0732 * * 21.0732 

530031 ............................................................................. 0.9546 0.9207 16.8825 16.3472 * 16.6017 

530032 ............................................................................. 1.0215 0.9207 19.4449 22.6584 22.9391 21.6640 

1Based on salaries adjusted for occupational mix, according to the calculation in section III.C.2. of the preamble to this proposed rule. 2These hospitals are assigned a wage index value according to section III.H. of the preamble of this proposed rule. 

hThese hospitals are assigned a wage index value according to section III.G. of the preamble to this proposed rule. 

*Denotes wage data not available for the provider for that year. 

**Based on the sum of the salaries and hours computed for Federal FYs 2004, 2005, and 2006. 

***Denotes MedPAR data not available for the provider for FY 2004. 

23544 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

TABLE 3A.—FY 2006 AND 3-YEAR* AVERAGE HOURLY WAGE FOR URBAN AREAS BY CBSA 

[*Based on the sum of the salaries and hours computed for Federal fiscal years 2004, 2005, and 2006] 

CBSA code Urban area 

FY 2006 average hourly 

wage 

3-Year 

average 

hourly wage 

10180 ....... Abilene, TX ............................................................................................................................................... 22.1701 20.4985 

10380 ....... Aguadilla-Isabela-San Sebastı ́n, PR ......................................................................................................... 13.2502 11.5908 

10420 ....... Akron, OH ................................................................................................................................................. 25.1189 23.9584 

10500 ....... Albany, GA ................................................................................................................................................ 24.1844 26.6216 

10580 ....... Albany-Schenectady-Troy, NY .................................................................................................................. 23.9528 22.6259 

10740 ....... Albuquerque, NM ...................................................................................................................................... 27.1248 25.7999 

10780 ....... Alexandria, LA ........................................................................................................................................... 22.5148 21.3129 

10900 ....... Allentown-Bethlehem-Easton, PA-NJ ....................................................................................................... 27.5389 25.5680 

11020 ....... Altoona, PA ............................................................................................................................................... 25.0167 22.9759 

11100 ....... Amarillo, TX .............................................................................................................................................. 25.6410 24.0270 

11180 ....... Ames, IA ................................................................................................................................................... 26.7068 25.0247 

11260 ....... Anchorage, AK .......................................................................................................................................... 33.8779 32.1826 

11300 ....... Anderson, IN ............................................................................................................................................. 24.1549 23.0714 

11340 ....... Anderson, SC ............................................................................................................................................ 24.8624 22.9488 

11460 ....... Ann Arbor, MI ............................................................................................................................................ 30.4505 29.2076 

11500 ....... Anniston-Oxford, AL .................................................................................................................................. 21.4718 20.7611 

11540 ....... Appleton, WI ............................................................................................................................................. 25.9098 24.1044 

11700 ....... Asheville, NC ............................................................................................................................................ 26.0511 24.5466 

12020 ....... Athens-Clarke County, GA ....................................................................................................................... 27.4532 26.1928 

12060 ....... Atlanta-Sandy Springs-Marietta, GA ......................................................................................................... 26.9604 26.0983 

12100 ....... Atlantic City, NJ ........................................................................................................................................ 32.5013 29.4922 

12220 ....... Auburn-Opelika, AL ................................................................................................................................... 22.6976 21.8061 

12260 ....... Augusta-Richmond County, GA-SC ......................................................................................................... 26.7647 24.8652 

12420 ....... Austin-Round Rock, TX ............................................................................................................................ 26.4408 25.2181 

12540 ....... Bakersfield, CA ......................................................................................................................................... 28.9777 26.6414 

12580 ....... Baltimore-Towson, MD ............................................................................................................................. 27.6740 26.1267 

12620 ....... Bangor, ME ............................................................................................................................................... 27.9343 26.2399 

12700 ....... Barnstable Town, MA ............................................................................................................................... 35.0207 33.2353 

12940 ....... Baton Rouge, LA ...................................................................................................................................... 24.0727 22.2239 

12980 ....... Battle Creek, MI ........................................................................................................................................ 26.5543 24.8160 

13020 ....... Bay City, MI .............................................................................................................................................. 26.1760 25.1852 

13140 ....... Beaumont-Port Arthur, TX ........................................................................................................................ 23.5603 22.3855 

13380 ....... Bellingham, WA ........................................................................................................................................ 32.7446 30.8324 

13460 ....... Bend, OR .................................................................................................................................................. 30.1666 28.0136 

13644 ....... Bethesda-Frederick-Gaithersburg, MD ..................................................................................................... 32.0917 29.4434 

13740 ....... Billings, MT ............................................................................................................................................... 24.7710 23.5742 

13780 ....... Binghamton, NY ........................................................................................................................................ 24.0264 22.4051 

13820 ....... Birmingham-Hoover, AL ............................................................................................................................ 25.1185 23.9577 

13900 ....... Bismarck, ND ............................................................................................................................................ 21.0353 20.1696 

13980 ....... Blacksburg-Christiansburg-Radford, VA ................................................................................................... 22.3143 21.3890 

14020 ....... Bloomington, IN ........................................................................................................................................ 23.7061 22.5941 

14060 ....... Bloomington-Normal, IL ............................................................................................................................ 25.4101 23.7897 

14260 ....... Boise City-Nampa, ID ............................................................................................................................... 25.3133 24.3052 

14484 ....... Boston-Quincy, MA ................................................................................................................................... 32.2755 30.7174 

14500 ....... Boulder, CO .............................................................................................................................................. 27.2574 26.2715 

14540 ....... Bowling Green, KY ................................................................................................................................... 23.0011 21.8437 

14740 ....... Bremerton-Silverdale, WA ........................................................................................................................ 29.8809 28.0919 

14860 ....... Bridgeport-Stamford-Norwalk, CT ............................................................................................................. 35.2686 33.7851 

15180 ....... Brownsville-Harlingen, TX ......................................................................................................................... 27.5656 26.6683 

15260 ....... Brunswick, GA .......................................................................................................................................... 26.1311 28.6493 

15380 ....... Buffalo-Niagara Falls, NY ......................................................................................................................... 24.8634 24.3177 

15500 ....... Burlington, NC ........................................................................................................................................... 24.9033 23.6142 

15540 ....... Burlington-South Burlington, VT ............................................................................................................... 26.4165 25.0134 

15764 ....... Cambridge-Newton-Framingham, MA ...................................................................................................... 30.9921 29.2429 

15804 ....... Camden, NJ .............................................................................................................................................. 29.4132 28.1192 

15940 ....... Canton-Massillon, OH ............................................................................................................................... 25.0564 23.6833 

15980 ....... Cape Coral-Fort Myers, FL ....................................................................................................................... 26.1095 25.0250 

16180 ....... Carson City, NV ........................................................................................................................................ 28.6158 27.0192 

16220 ....... Casper, WY ............................................................................................................................................... 25.2526 24.0014 

16300 ....... Cedar Rapids, IA ...................................................................................................................................... 24.0727 23.2382 

16580 ....... Champaign-Urbana, IL .............................................................................................................................. 26.8325 25.4853 

16620 ....... Charleston, WV ......................................................................................................................................... 23.5802 22.9895 

16700 ....... Charleston-North Charleston, SC ............................................................................................................. 26.3883 24.7642 

16740 ....... Charlotte-Gastonia-Concord, NC-SC ........................................................................................................ 27.1825 25.6465 

16820 ....... Charlottesville, VA ..................................................................................................................................... 28.6200 26.8014 

16860 ....... Chattanooga, TN-GA ................................................................................................................................ 25.4537 24.0895 

16940 ....... Cheyenne, WY .......................................................................................................................................... 24.5947 23.3995 

16974 ....... Chicago-Naperville-Joliet, IL ..................................................................................................................... 30.3410 28.6963 

17020 ....... Chico, CA .................................................................................................................................................. 29.4447 27.4655 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23545 

TABLE 3A.—FY 2006 AND 3-YEAR* AVERAGE HOURLY WAGE FOR URBAN AREAS BY CBSA—Continued 

[*Based on the sum of the salaries and hours computed for Federal fiscal years 2004, 2005, and 2006] 

CBSA code Urban area 

FY 2006 average hourly 

wage 

3-Year 

average 

hourly wage 

17140 ....... Cincinnati-Middletown, OH-KY-IN ............................................................................................................. 26.8669 25.0229 

17300 ....... Clarksville, TN-KY ..................................................................................................................................... 23.1419 21.5444 

17420 ....... Cleveland, TN ........................................................................................................................................... 22.8278 21.2133 

17460 ....... Cleveland-Elyria-Mentor, OH .................................................................................................................... 25.7303 25.0687 

17660 ....... Coeur d’Alene, ID ..................................................................................................................................... 26.9749 25.1364 

17780 ....... College Station-Bryan, TX ........................................................................................................................ 24.9298 23.8550 

17820 ....... Colorado Springs, CO ............................................................................................................................... 26.4562 25.5825 

17860 ....... Columbia, MO ........................................................................................................................................... 23.3470 22.3003 

17900 ....... Columbia, SC ............................................................................................................................................ 25.3362 24.0049 

17980 ....... Columbus, GA-AL ..................................................................................................................................... 23.9764 22.7919 

18020 ....... Columbus, IN ............................................................................................................................................ 26.8458 25.0573 

18140 ....... Columbus, OH .......................................................................................................................................... 27.5495 25.7193 

18580 ....... Corpus Christi, TX .................................................................................................................................... 23.9399 22.6210 

18700 ....... Corvallis, OR ............................................................................................................................................. 29.9648 28.7806 

19060 ....... Cumberland, MD-WV ................................................................................................................................ 26.0448 22.8828 

19124 ....... Dallas-Plano-Irving, TX ............................................................................................................................. 28.6076 26.7125 

19140 ....... Dalton, GA ................................................................................................................................................ 25.2695 24.8431 

19180 ....... Danville, IL ................................................................................................................................................ 25.3127 22.9099 

19260 ....... Danville, VA .............................................................................................................................................. 23.8191 23.0000 

19340 ....... Davenport-Moline-Rock Island, IA-IL ........................................................................................................ 24.3842 23.2403 

19380 ....... Dayton, OH ............................................................................................................................................... 25.3708 24.4405 

19460 ....... Decatur, AL ............................................................................................................................................... 23.7138 22.9734 

19500 ....... Decatur, IL ................................................................................................................................................ 22.5852 21.4281 

19660 ....... Deltona-Daytona Beach-Ormond Beach, FL ............................................................................................ 26.0379 24.0560 

19740 ....... Denver-Aurora, CO ................................................................................................................................... 29.9610 28.5110 

19780 ....... Des Moines, IA ......................................................................................................................................... 26.9975 24.6647 

19804 ....... Detroit-Livonia-Dearborn, MI ..................................................................................................................... 29.2431 27.2952 

20020 ....... Dothan, AL ................................................................................................................................................ 21.6602 20.2540 

20100 ....... Dover, DE ................................................................................................................................................. 27.4735 25.9428 

20220 ....... Dubuque, IA .............................................................................................................................................. 25.5030 23.5042 

20260 ....... Duluth, MN-WI .......................................................................................................................................... 28.5299 27.0543 

20500 ....... Durham, NC .............................................................................................................................................. 28.7033 27.3555 

20740 ....... Eau Claire, WI ........................................................................................................................................... 25.7563 24.1573 

20764 ....... Edison, NJ ................................................................................................................................................. 31.5082 29.5433 

20940 ....... El Centro, CA ............................................................................................................................................ 25.1083 23.7136 

21060 ....... Elizabethtown, KY ..................................................................................................................................... 24.6642 22.6125 

21140 ....... Elkhart-Goshen, IN ................................................................................................................................... 26.9005 25.1975 

21300 ....... Elmira, NY ................................................................................................................................................. 23.1540 22.0419 

21340 ....... El Paso, TX ............................................................................................................................................... 25.0500 23.9275 

21500 ....... Erie, PA ..................................................................................................................................................... 24.4677 22.8915 

21604 ....... Essex County, MA .................................................................................................................................... 29.4434 27.9641 

21660 ....... Eugene-Springfield, OR ............................................................................................................................ 30.2425 29.2693 

21780 ....... Evansville, IN-KY ...................................................................................................................................... 24.4379 22.4627 

21820 ....... Fairbanks, AK ........................................................................................................................................... 31.8995 29.8198 

21940 ....... Fajardo, PR ............................................................................................................................................... 11.6386 10.6772 

22020 ....... Fargo, ND-MN ........................................................................................................................................... 23.7360 23.9742 

22140 ....... Farmington, NM ........................................................................................................................................ 23.8264 22.4376 

22180 ....... Fayetteville, NC ......................................................................................................................................... 26.3708 24.3719 

22220 ....... Fayetteville-Springdale-Rogers, AR-MO ................................................................................................... 24.0127 22.5998 

22380 ....... Flagstaff, AZ .............................................................................................................................................. 33.8333 30.2808 

22420 ....... Flint, MI ..................................................................................................................................................... 29.7989 28.6871 

22500 ....... Florence, SC ............................................................................................................................................. 25.1444 23.2705 

22520 ....... Florence-Muscle Shoals, AL ..................................................................................................................... 23.2344 21.0532 

22540 ....... Fond du Lac, WI ....................................................................................................................................... 26.9936 25.7252 

22660 ....... Fort Collins-Loveland, CO ........................................................................................................................ 28.2568 26.7964 

22744 ....... Fort Lauderdale-Pompano Beach-Deerfield Beach, FL ........................................................................... 29.1773 27.0873 

22900 ....... Fort Smith, AR-OK .................................................................................................................................... 23.0272 21.9069 

23020 ....... Fort Walton Beach-Crestview-Destin, FL ................................................................................................. 24.8333 23.4332 

23060 ....... Fort Wayne, IN .......................................................................................................................................... 27.4082 25.7154 

23104 ....... Fort Worth-Arlington, TX ........................................................................................................................... 26.6167 24.9487 

23420 ....... Fresno, CA ................................................................................................................................................ 29.6215 27.6921 

23460 ....... Gadsden, AL ............................................................................................................................................. 22.3074 21.3197 

23540 ....... Gainesville, FL .......................................................................................................................................... 26.4676 25.1553 

23580 ....... Gainesville, GA ......................................................................................................................................... 24.8893 24.3542 

23844 ....... Gary, IN ..................................................................................................................................................... 26.2014 24.6755 

24020 ....... Glens Falls, NY ......................................................................................................................................... 24.0232 22.4577 

24140 ....... Goldsboro, NC .......................................................................................................................................... 24.5666 23.0280 

24220 ....... Grand Forks, ND-MN ................................................................................................................................ 32.2306 26.3170 

24300 ....... Grand Junction, CO .................................................................................................................................. 26.8293 25.6655 

23546 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

TABLE 3A.—FY 2006 AND 3-YEAR* AVERAGE HOURLY WAGE FOR URBAN AREAS BY CBSA—Continued 

[*Based on the sum of the salaries and hours computed for Federal fiscal years 2004, 2005, and 2006] 

CBSA code Urban area 

FY 2006 average hourly 

wage 

3-Year 

average 

hourly wage 

24340 ....... Grand Rapids-Wyoming, MI ..................................................................................................................... 26.2918 24.9274 

24500 ....... Great Falls, MT ......................................................................................................................................... 25.2873 23.4084 

24540 ....... Greeley, CO .............................................................................................................................................. 26.8470 25.0779 

24580 ....... Green Bay, WI .......................................................................................................................................... 26.4060 25.1220 

24660 ....... Greensboro-High Point, NC ...................................................................................................................... 25.5495 24.2161 

24780 ....... Greenville, NC ........................................................................................................................................... 26.3325 24.3631 

24860 ....... Greenville, SC ........................................................................................................................................... 28.3616 25.8028 

25020 ....... Guayama, PR ........................................................................................................................................... 08.9125 09.5939 

25060 ....... Gulfport-Biloxi, MS .................................................................................................................................... 24.9592 23.9056 

25180 ....... Hagerstown-Martinsburg, MD-WV ............................................................................................................ 26.6548 25.0347 

25260 ....... Hanford-Corcoran, CA .............................................................................................................................. 28.1814 25.1270 

25420 ....... Harrisburg-Carlisle, PA ............................................................................................................................. 26.0656 24.4935 

25500 ....... Harrisonburg, VA ...................................................................................................................................... 25.4597 24.2345 

25540 ....... Hartford-West Hartford-East Hartford, CT ................................................................................................ 31.0121 29.5959 

25620 ....... Hattiesburg, MS ........................................................................................................................................ 21.3089 19.6542 

25860 ....... Hickory-Lenoir-Morganton, NC ................................................................................................................. 24.9837 24.3032 

25980 ....... 1Hinesville-Fort Stewart, GA ..................................................................................................................... .------- .------- 

26100 ....... Holland-Grand Haven, MI ......................................................................................................................... 25.4579 24.5609 

26180 ....... Honolulu, HI .............................................................................................................................................. 31.3501 29.2509 

26300 ....... Hot Springs, AR ........................................................................................................................................ 25.3627 24.1181 

26380 ....... Houma-Bayou Cane-Thibodaux, LA ......................................................................................................... 22.1079 20.5356 

26420 ....... Houston-Baytown-Sugar Land, TX ........................................................................................................... 27.9993 26.1356 

26580 ....... Huntington-Ashland, WV-KY-OH .............................................................................................................. 26.5266 25.2510 

26620 ....... Huntsville, AL ............................................................................................................................................ 25.5254 23.9276 

26820 ....... Idaho Falls, ID ........................................................................................................................................... 26.3236 24.2135 

26900 ....... Indianapolis, IN ......................................................................................................................................... 27.7571 26.3923 

26980 ....... Iowa City, IA .............................................................................................................................................. 27.2791 25.4755 

27060 ....... Ithaca, NY ................................................................................................................................................. 27.5699 25.6624 

27100 ....... Jackson, MI ............................................................................................................................................... 26.0171 24.0809 

27140 ....... Jackson, MS ............................................................................................................................................. 23.2553 21.9059 

27180 ....... Jackson, TN .............................................................................................................................................. 25.0772 23.6035 

27260 ....... Jacksonville, FL ........................................................................................................................................ 26.0254 24.9544 

27340 ....... Jacksonville, NC ....................................................................................................................................... 23.0236 22.0702 

27500 ....... Janesville, WI ............................................................................................................................................ 26.7462 25.0136 

27620 ....... Jefferson City, MO .................................................................................................................................... 23.4699 22.4350 

27740 ....... Johnson City, TN ...................................................................................................................................... 22.2633 21.2152 

27780 ....... Johnstown, PA .......................................................................................................................................... 23.3540 22.1239 

27860 ....... Jonesboro, AR .......................................................................................................................................... 22.2913 21.0721 

27900 ....... Joplin, MO ................................................................................................................................................. 24.0416 22.8597 

28020 ....... Kalamazoo-Portage, MI ............................................................................................................................ 29.1036 28.0902 

28100 ....... Kankakee-Bradley, IL ................................................................................................................................ 30.7469 28.2579 

28140 ....... Kansas City, MO-KS ................................................................................................................................. 26.4479 25.2795 

28420 ....... Kennewick-Richland-Pasco, WA .............................................................................................................. 29.7070 27.8472 

28660 ....... Killeen-Temple-Fort Hood, TX .................................................................................................................. 23.9626 23.6807 

28700 ....... Kingsport-Bristol-Bristol, TN-VA ................................................................................................................ 22.5380 21.6656 

28740 ....... Kingston, NY ............................................................................................................................................. 25.9063 24.4214 

28940 ....... Knoxville, TN ............................................................................................................................................. 23.6960 22.7400 

29020 ....... Kokomo, IN ............................................................................................................................................... 26.7312 24.3627 

29100 ....... La Crosse, WI-MN .................................................................................................................................... 26.7369 24.6616 

29140 ....... Lafayette, IN .............................................................................................................................................. 24.4215 23.5470 

29180 ....... Lafayette, LA ............................................................................................................................................. 23.5797 22.0745 

29340 ....... Lake Charles, LA ...................................................................................................................................... 21.9512 20.7252 

29404 ....... Lake County-Kenosha County, IL-WI ....................................................................................................... 29.2180 27.3940 

29460 ....... Lakeland, FL ............................................................................................................................................. 24.9925 23.4702 

29540 ....... Lancaster, PA ........................................................................................................................................... 27.1801 25.5025 

29620 ....... Lansing-East Lansing, MI ......................................................................................................................... 27.3767 25.6366 

29700 ....... Laredo, TX ................................................................................................................................................ 22.6637 21.9619 

29740 ....... Las Cruces, NM ........................................................................................................................................ 23.6548 22.8284 

29820 ....... Las Vegas-Paradise, NV .......................................................................................................................... 31.9355 30.3760 

29940 ....... Lawrence, KS ............................................................................................................................................ 23.8863 22.7099 

30020 ....... Lawton, OK ............................................................................................................................................... 22.1442 21.4717 

30140 ....... Lebanon, PA ............................................................................................................................................. 24.2087 23.0471 

30300 ....... Lewiston, ID-WA ....................................................................................................................................... 27.6345 24.9793 

30340 ....... Lewiston-Auburn, ME ................................................................................................................................ 26.1064 24.8965 

30460 ....... Lexington-Fayette, KY .............................................................................................................................. 25.3464 22.7343 

30620 ....... Lima, OH ................................................................................................................................................... 25.7797 24.7454 

30700 ....... Lincoln, NE ................................................................................................................................................ 28.5262 27.0530 

30780 ....... Little Rock-North Little Rock, AR .............................................................................................................. 24.5286 23.3089 

30860 ....... Logan, UT-ID ............................................................................................................................................ 25.6905 24.3475 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23547 

TABLE 3A.—FY 2006 AND 3-YEAR* AVERAGE HOURLY WAGE FOR URBAN AREAS BY CBSA—Continued 

[*Based on the sum of the salaries and hours computed for Federal fiscal years 2004, 2005, and 2006] 

CBSA code Urban area 

FY 2006 average hourly 

wage 

3-Year 

average 

hourly wage 

30980 ....... Longview, TX ............................................................................................................................................ 24.4521 23.4643 

31020 ....... Longview, WA ........................................................................................................................................... 26.5976 26.1814 

31084 ....... Los Angeles-Long Beach-Glendale, CA ................................................................................................... 32.9050 31.0454 

31140 ....... Louisville, KY-IN ........................................................................................................................................ 25.9154 24.2971 

31180 ....... Lubbock, TX .............................................................................................................................................. 24.5905 22.7060 

31340 ....... Lynchburg, VA .......................................................................................................................................... 24.3559 23.5846 

31420 ....... Macon, GA ................................................................................................................................................ 26.5343 25.0025 

31460 ....... Madera, CA ............................................................................................................................................... 24.4061 22.5247 

31540 ....... Madison, WI .............................................................................................................................................. 29.7363 27.4059 

31700 ....... Manchester-Nashua, NH .......................................................................................................................... 28.8847 27.6772 

31900 ....... 1Mansfield, OH .......................................................................................................................................... ------- ------- 

32420 ....... Mayagu ̈ez, PR .......................................................................................................................................... 11.2362 11.3917 

32580 ....... McAllen-Edinburg-Pharr, TX ..................................................................................................................... 25.0238 22.9932 

32780 ....... Medford, OR ............................................................................................................................................. 28.6299 27.7062 

32820 ....... Memphis, TN-MS-AR ................................................................................................................................ 26.1471 24.2118 

32900 ....... Merced, CA ............................................................................................................................................... 31.1184 27.6673 

33124 ....... Miami-Miami Beach-Kendall, FL ............................................................................................................... 27.2942 25.9755 

33140 ....... Michigan City-La Porte, IN ........................................................................................................................ 26.3221 24.7313 

33260 ....... Midland, TX ............................................................................................................................................... 26.6395 25.3824 

33340 ....... Milwaukee-Waukesha-West Allis, WI ....................................................................................................... 28.2858 26.5793 

33460 ....... Minneapolis-St. Paul-Bloomington, MN-WI .............................................................................................. 30.9281 29.1156 

33540 ....... Missoula, MT ............................................................................................................................................. 26.4227 24.2896 

33660 ....... Mobile, AL ................................................................................................................................................. 22.1076 20.9624 

33700 ....... Modesto, CA ............................................................................................................................................. 33.0964 31.0034 

33740 ....... Monroe, LA ............................................................................................................................................... 22.5035 20.9918 

33780 ....... Monroe, MI ................................................................................................................................................ 26.4882 25.0486 

33860 ....... Montgomery, AL ........................................................................................................................................ 24.0586 21.7643 

34060 ....... Morgantown, WV ...................................................................................................................................... 23.6097 22.7263 

34100 ....... Morristown, TN .......................................................................................................................................... 24.5017 21.6486 

34580 ....... Mount Vernon-Anacortes, WA .................................................................................................................. 29.2146 27.8316 

34620 ....... Muncie, IN ................................................................................................................................................. 25.0449 23.0977 

34740 ....... Muskegon-Norton Shores, MI ................................................................................................................... 27.0713 25.4822 

34820 ....... Myrtle Beach-Conway-North Myrtle Beach, SC ....................................................................................... 24.8106 23.7419 

34900 ....... Napa, CA .................................................................................................................................................. 35.3683 32.9923 

34940 ....... Naples-Marco Island, FL ........................................................................................................................... 28.2979 26.9037 

34980 ....... Nashville-Davidson—Murfreesboro, TN ................................................................................................... 27.2968 26.1014 

35004 ....... Nassau-Suffolk, NY ................................................................................................................................... 35.7543 34.1418 

35084 ....... Newark-Union, NJ-PA ............................................................................................................................... 34.1064 31.1564 

35300 ....... New Haven-Milford, CT ............................................................................................................................ 32.7989 31.1765 

35380 ....... New Orleans-Metairie-Kenner, LA ............................................................................................................ 25.1852 23.9697 

35644 ....... New York-Wayne-White Plains, NY-NJ .................................................................................................... 36.9026 35.2542 

35660 ....... Niles-Benton Harbor, MI ........................................................................................................................... 24.8541 23.3997 

35980 ....... Norwich-New London, CT ......................................................................................................................... 31.8510 30.4182 

36084 ....... Oakland-Fremont-Hayward, CA ................................................................................................................ 42.8742 40.0207 

36100 ....... Ocala, FL .................................................................................................................................................. 25.0519 24.4578 

36140 ....... Ocean City, NJ .......................................................................................................................................... 30.8612 28.5543 

36220 ....... Odessa, TX ............................................................................................................................................... 27.6769 25.1761 

36260 ....... Ogden-Clearfield, UT ................................................................................................................................ 25.2772 24.5654 

36420 ....... Oklahoma City, OK ................................................................................................................................... 25.2975 23.7988 

36500 ....... Olympia, WA ............................................................................................................................................. 30.5859 28.9079 

36540 ....... Omaha-Council Bluffs, NE-IA ................................................................................................................... 26.7314 25.5410 

36740 ....... Orlando, FL ............................................................................................................................................... 26.4250 25.3813 

36780 ....... Oshkosh-Neenah, WI ................................................................................................................................ 25.6249 23.9585 

36980 ....... Owensboro, KY ......................................................................................................................................... 24.6348 22.4970 

37100 ....... Oxnard-Thousand Oaks-Ventura, CA ....................................................................................................... 32.4624 29.7410 

37340 ....... Palm Bay-Melbourne-Titusville, FL ........................................................................................................... 27.4887 25.7496 

37460 ....... Panama City-Lynn Haven, FL .................................................................................................................. 22.3439 21.3568 

37620 ....... Parkersburg-Marietta, WV-OH .................................................................................................................. 23.2293 21.7277 

37700 ....... Pascagoula, MS ........................................................................................................................................ 22.8397 21.4591 

37860 ....... Pensacola-Ferry Pass-Brent, FL .............................................................................................................. 22.6287 22.0289 

37900 ....... Peoria, IL ................................................................................................................................................... 24.7421 23.2730 

37964 ....... Philadelphia, PA ........................................................................................................................................ 30.8573 28.8565 

38060 ....... Phoenix-Mesa-Scottsdale, AZ .................................................................................................................. 28.3642 26.6530 

38220 ....... Pine Bluff, AR ........................................................................................................................................... 24.3824 22.1870 

38300 ....... Pittsburgh, PA ........................................................................................................................................... 24.7296 23.2597 

38340 ....... Pittsfield, MA ............................................................................................................................................. 28.4877 27.1701 

38540 ....... Pocatello, ID .............................................................................................................................................. 26.1526 24.5528 

38660 ....... Ponce, PR ................................................................................................................................................. 14.4851 13.0375 

38860 ....... Portland-South Portland-Biddeford, ME ................................................................................................... 29.0440 26.7442 

23548 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

TABLE 3A.—FY 2006 AND 3-YEAR* AVERAGE HOURLY WAGE FOR URBAN AREAS BY CBSA—Continued 

[*Based on the sum of the salaries and hours computed for Federal fiscal years 2004, 2005, and 2006] 

CBSA code Urban area 

FY 2006 average hourly 

wage 

3-Year 

average 

hourly wage 

38900 ....... Portland-Vancouver-Beaverton, OR-WA .................................................................................................. 31.4148 29.7614 

38940 ....... Port St. Lucie-Fort Pierce, FL ................................................................................................................... 28.3669 26.5761 

39100 ....... Poughkeepsie-Newburgh-Middletown, NY ............................................................................................... 30.1207 29.3034 

39140 ....... Prescott, AZ .............................................................................................................................................. 27.6508 26.3318 

39300 ....... Providence-New Bedford-Fall River, RI-MA ............................................................................................. 30.6398 28.8359 

39340 ....... Provo-Orem, UT ........................................................................................................................................ 26.5574 25.4669 

39380 ....... Pueblo, CO ............................................................................................................................................... 24.1431 23.0046 

39460 ....... Punta Gorda, FL ....................................................................................................................................... 25.9442 24.8140 

39540 ....... Racine, WI ................................................................................................................................................ 25.2201 23.6789 

39580 ....... Raleigh-Cary, NC ...................................................................................................................................... 27.1623 25.4788 

39660 ....... Rapid City, SD .......................................................................................................................................... 25.2538 23.5560 

39740 ....... Reading, PA .............................................................................................................................................. 27.1301 24.7239 

39820 ....... Redding, CA .............................................................................................................................................. 34.1503 31.2183 

39900 ....... Reno-Sparks, NV ...................................................................................................................................... 30.7272 28.3079 

40060 ....... Richmond, VA ........................................................................................................................................... 26.0695 24.6756 

40140 ....... Riverside-San Bernardino-Ontario, CA ..................................................................................................... 30.8328 29.3251 

40220 ....... Roanoke, VA ............................................................................................................................................. 23.4915 22.4289 

40340 ....... Rochester, MN .......................................................................................................................................... 31.1302 30.1737 

40380 ....... Rochester, NY ........................................................................................................................................... 25.5065 24.5493 

40420 ....... Rockford, IL ............................................................................................................................................... 27.9047 25.7304 

40484 ....... Rockingham County-Strafford County, NH ............................................................................................... 29.0055 27.0997 

40580 ....... Rocky Mount, NC ...................................................................................................................................... 24.9648 23.6953 

40660 ....... Rome, GA ................................................................................................................................................. 26.3370 23.8100 

40900 ....... Sacramento--Arden-Arcade--Roseville, CA .............................................................................................. 36.2362 32.0754 

40980 ....... Saginaw-Saginaw Township North, MI ..................................................................................................... 26.5050 25.8822 

41060 ....... St. Cloud, MN ........................................................................................................................................... 28.0585 26.3196 

41100 ....... St. George, UT .......................................................................................................................................... 26.3420 25.1139 

41140 ....... St. Joseph, MO-KS ................................................................................................................................... 26.7587 25.8174 

41180 ....... St. Louis, MO-IL ........................................................................................................................................ 25.0452 23.7896 

41420 ....... Salem, OR ................................................................................................................................................ 29.2207 27.6647 

41500 ....... Salinas, CA ............................................................................................................................................... 39.5570 37.1828 

41540 ....... Salisbury, MD ............................................................................................................................................ 25.3485 24.0517 

41620 ....... Salt Lake City, UT ..................................................................................................................................... 26.3970 25.4439 

41660 ....... San Angelo, TX ......................................................................................................................................... 23.1837 21.9567 

41700 ....... San Antonio, TX ........................................................................................................................................ 25.1428 23.6255 

41740 ....... San Diego-Carlsbad-San Marcos, CA ...................................................................................................... 31.9401 29.8191 

41780 ....... Sandusky, OH ........................................................................................................................................... 25.2690 23.6568 

41884 ....... San Francisco-San Mateo-Redwood City, CA ......................................................................................... 41.8804 38.9640 

41900 ....... San Germa ́n-Cabo Rojo, PR .................................................................................................................... 12.9971 13.4135 

41940 ....... San Jose-Sunnyvale-Santa Clara, CA ..................................................................................................... 42.2833 39.0995 

41980 ....... San Juan-Caguas-Guaynabo, PR ............................................................................................................ 13.1085 12.3738 

42020 ....... San Luis Obispo-Paso Robles, CA .......................................................................................................... 31.7731 29.7965 

42044 ....... Santa Ana-Anaheim-Irvine, CA ................................................................................................................. 32.3515 30.4088 

42060 ....... Santa Barbara-Santa Maria-Goleta, CA ................................................................................................... 32.2413 28.8239 

42100 ....... Santa Cruz-Watsonville, CA ..................................................................................................................... 42.4095 37.7929 

42140 ....... Santa Fe, NM ............................................................................................................................................ 30.5158 28.6521 

42220 ....... Santa Rosa-Petaluma, CA ........................................................................................................................ 37.7122 34.7294 

42260 ....... Sarasota-Bradenton-Venice, FL ............................................................................................................... 26.6769 25.5601 

42340 ....... Savannah, GA ........................................................................................................................................... 26.5289 24.9832 

42540 ....... Scranton—Wilkes-Barre, PA ..................................................................................................................... 23.8629 22.4039 

42644 ....... Seattle-Bellevue-Everett, WA ................................................................................................................... 32.3774 30.4447 

43100 ....... Sheboygan, WI ......................................................................................................................................... 24.9924 23.3301 

43300 ....... Sherman-Denison, TX .............................................................................................................................. 26.6281 25.3544 

43340 ....... Shreveport-Bossier City, LA ..................................................................................................................... 24.5258 23.6868 

43580 ....... Sioux City, IA-NE-SD ................................................................................................................................ 26.1843 24.0956 

43620 ....... Sioux Falls, SD ......................................................................................................................................... 26.9025 25.0103 

43780 ....... South Bend-Mishawaka, IN-MI ................................................................................................................. 27.3743 25.4781 

43900 ....... Spartanburg, SC ....................................................................................................................................... 25.6900 24.5737 

44060 ....... Spokane, WA ............................................................................................................................................ 30.4868 28.5450 

44100 ....... Springfield, IL ............................................................................................................................................ 24.8405 23.3039 

44140 ....... Springfield, MA .......................................................................................................................................... 28.7008 27.2255 

44180 ....... Springfield, MO ......................................................................................................................................... 23.0819 22.2164 

44220 ....... Springfield, OH .......................................................................................................................................... 23.4939 22.7752 

44300 ....... State College, PA ..................................................................................................................................... 23.4099 22.4626 

44700 ....... Stockton, CA ............................................................................................................................................. 31.7047 28.5078 

44940 ....... Sumter, SC ............................................................................................................................................... 23.4355 22.1331 

45060 ....... Syracuse, NY ............................................................................................................................................ 26.8425 25.0698 

45104 ....... Tacoma, WA ............................................................................................................................................. 30.0701 28.9533 

45220 ....... Tallahassee, FL ........................................................................................................................................ 24.3724 22.7559 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23549 

TABLE 3A.—FY 2006 AND 3-YEAR* AVERAGE HOURLY WAGE FOR URBAN AREAS BY CBSA—Continued 

[*Based on the sum of the salaries and hours computed for Federal fiscal years 2004, 2005, and 2006] 

CBSA code Urban area 

FY 2006 average hourly 

wage 

3-Year 

average 

hourly wage 

45300 ....... Tampa-St. Petersburg-Clearwater, FL ...................................................................................................... 25.8608 24.1485 

45460 ....... Terre Haute, IN ......................................................................................................................................... 23.2574 22.0638 

45500 ....... Texarkana, TX-Texarkana, AR ................................................................................................................. 23.2000 21.8927 

45780 ....... Toledo, OH ................................................................................................................................................ 26.7822 25.0440 

45820 ....... Topeka, KS ............................................................................................................................................... 24.9561 23.6665 

45940 ....... Trenton-Ewing, NJ .................................................................................................................................... 30.3180 27.8778 

46060 ....... Tucson, AZ ................................................................................................................................................ 25.1965 23.6781 

46140 ....... Tulsa, OK .................................................................................................................................................. 23.2484 22.9280 

46220 ....... Tuscaloosa, AL ......................................................................................................................................... 24.4051 22.1412 

46340 ....... Tyler, TX ................................................................................................................................................... 26.0797 24.9826 

46540 ....... Utica-Rome, NY ........................................................................................................................................ 23.2558 21.9605 

46660 ....... Valdosta, GA ............................................................................................................................................. 24.8233 22.4638 

46700 ....... Vallejo-Fairfield, CA .................................................................................................................................. 41.6513 38.4022 

46940 ....... Vero Beach, FL ......................................................................................................................................... 26.4579 25.3120 

47020 ....... Victoria, TX ............................................................................................................................................... 22.7937 21.7127 

47220 ....... Vineland-Millville-Bridgeton, NJ ................................................................................................................ 27.5232 27.0476 

47260 ....... Virginia Beach-Norfolk-Newport News, VA-NC ........................................................................................ 24.7332 23.2422 

47300 ....... Visalia-Porterville, CA ............................................................................................................................... 28.2676 26.4299 

47380 ....... Waco, TX .................................................................................................................................................. 23.8678 22.0533 

47580 ....... Warner Robins, GA ................................................................................................................................... 24.2312 22.6117 

47644 ....... Warren-Farmington Hills-Troy, MI ............................................................................................................ 27.5791 26.2703 

47894 ....... Washington-Arlington-Alexandria, DC-VA-MD-WV .................................................................................. 30.5916 28.8815 

47940 ....... Waterloo-Cedar Falls, IA .......................................................................................................................... 23.9572 22.5445 

48140 ....... Wausau, WI .............................................................................................................................................. 27.0185 25.5053 

48260 ....... Weirton-Steubenville, WV-OH .................................................................................................................. 21.8793 21.4989 

48300 ....... Wenatchee, WA ........................................................................................................................................ 28.1544 26.5892 

48424 ....... West Palm Beach-Boca Raton-Boynton Beach, FL ................................................................................. 28.1452 26.6150 

48540 ....... Wheeling, WV-OH ..................................................................................................................................... 20.0483 19.3905 

48620 ....... Wichita, KS ............................................................................................................................................... 25.6152 24.4842 

48660 ....... Wichita Falls, TX ....................................................................................................................................... 23.2954 21.9177 

48700 ....... Williamsport, PA ........................................................................................................................................ 23.4090 21.9892 

48864 ....... Wilmington, DE-MD-NJ ............................................................................................................................. 29.4490 28.5184 

48900 ....... Wilmington, NC ......................................................................................................................................... 26.7996 24.9839 

49020 ....... Winchester, VA-WV .................................................................................................................................. 28.5744 27.1963 

49180 ....... Winston-Salem, NC .................................................................................................................................. 25.0655 24.1158 

49340 ....... Worcester, MA .......................................................................................................................................... 30.8969 29.3320 

49420 ....... Yakima, WA .............................................................................................................................................. 28.4267 27.0960 

49500 ....... Yauco, PR ................................................................................................................................................. 12.3449 12.0750 

49620 ....... York-Hanover, PA ..................................................................................................................................... 26.3577 24.3575 

49660 ....... Youngstown-Warren-Boardman, OH-PA .................................................................................................. 24.0832 23.4935 

49700 ....... Yuba City, CA ........................................................................................................................................... 30.6351 27.8070 

49740 ....... Yuma, AZ .................................................................................................................................................. 25.7050 23.8047 

1This area has no average hourly wage because there are no IPPS hospitals in the area. 

TABLE 3B.—FY 2006 AND 3-YEAR* AVERAGE HOURLY WAGE FOR RURAL AREAS BY CBSA 

[*Based on the sum of the salaries and hours computed for Federal fiscal years 2004, 2005, and 2006] 

CBSA 

code Nonurban area 

FY 2006 average hourly 

wage 

3-Year 

Average 

Hourly 

Wage 

01 ............. Alabama .................................................................................................................................................... 20.9677 19.9301 

02 ............. Alaska ....................................................................................................................................................... 33.5065 31.4748 

03 ............. Arizona ...................................................................................................................................................... 24.5771 23.5781 

04 ............. Arkansas ................................................................................................................................................... 20.9189 19.6660 

05 ............. California ................................................................................................................................................... 30.3466 27.6453 

06 ............. Colorado .................................................................................................................................................... 26.2370 24.6175 

07 ............. Connecticut ............................................................................................................................................... 32.9843 31.5388 

08 ............. Delaware ................................................................................................................................................... 26.8747 25.1962 

10 ............. Florida ....................................................................................................................................................... 24.0946 22.8362 

11 ............. Georgia ..................................................................................................................................................... 21.4961 20.5018 

12 ............. Hawaii ....................................................................................................................................................... 29.6476 27.4203 

13 ............. Idaho ......................................................................................................................................................... 22.5556 21.6678 

14 ............. Illinois ........................................................................................................................................................ 23.1784 21.8542 

15 ............. Indiana ...................................................................................................................................................... 24.1494 22.9960 

16 ............. Iowa ........................................................................................................................................................... 23.7869 22.2470 

17 ............. Kansas ...................................................................................................................................................... 22.3594 21.2491 

23550 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

TABLE 3B.—FY 2006 AND 3-YEAR* AVERAGE HOURLY WAGE FOR RURAL AREAS BY CBSA—Continued 

[*Based on the sum of the salaries and hours computed for Federal fiscal years 2004, 2005, and 2006] 

CBSA 

code Nonurban area 

FY 2006 average hourly 

wage 

3-Year 

Average 

Hourly 

Wage 

18 ............. Kentucky ................................................................................................................................................... 21.7864 20.6370 

19 ............. Louisiana ................................................................................................................................................... 20.8290 19.5920 

20 ............. Maine ........................................................................................................................................................ 24.7292 23.4474 

21 ............. Maryland ................................................................................................................................................... 25.4559 24.0971 

22 ............. Massachusetts 1 ........................................................................................................................................ .................... ....................

23 ............. Michigan .................................................................................................................................................... 24.8226 23.3712 

24 ............. Minnesota .................................................................................................................................................. 25.6894 24.4485 

25 ............. Mississippi ................................................................................................................................................. 21.5005 20.3551 

26 ............. Missouri ..................................................................................................................................................... 22.1717 20.6813 

27 ............. Montana .................................................................................................................................................... 24.6808 23.0871 

28 ............. Nebraska ................................................................................................................................................... 24.2446 23.3257 

29 ............. Nevada ...................................................................................................................................................... 25.3983 24.4345 

30 ............. New Hampshire ........................................................................................................................................ 29.8455 26.8676 

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

32 ............. New Mexico .............................................................................................................................................. 24.1961 22.4946 

33 ............. New York .................................................................................................................................................. 22.8600 21.6353 

34 ............. North Carolina ........................................................................................................................................... 23.9761 22.5825 

35 ............. North Dakota ............................................................................................................................................. 20.3602 20.0510 

36 ............. Ohio ........................................................................................................................................................... 24.5857 23.0443 

37 ............. Oklahoma .................................................................................................................................................. 21.2973 20.1660 

38 ............. Oregon ...................................................................................................................................................... 27.4748 25.9138 

39 ............. Pennsylvania ............................................................................................................................................. 23.2205 21.9390 

40 ............. Puerto Rico 1 ............................................................................................................................................. .................... ....................

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

42 ............. South Carolina .......................................................................................................................................... 24.2359 22.7771 

43 ............. South Dakota ............................................................................................................................................ 23.7080 21.9887 

44 ............. Tennessee ................................................................................................................................................ 22.1430 20.8103 

45 ............. Texas ........................................................................................................................................................ 22.4855 21.0274 

46 ............. Utah ........................................................................................................................................................... 22.7561 21.7771 

47 ............. Vermont ..................................................................................................................................................... 27.4761 24.9413 

49 ............. Virginia ...................................................................................................................................................... 22.4489 21.2273 

50 ............. Washington ............................................................................................................................................... 29.2600 27.4343 

51 ............. West Virginia ............................................................................................................................................. 21.6576 20.5854 

52 ............. Wisconsin .................................................................................................................................................. 26.5156 24.7363 

53 ............. Wyoming ................................................................................................................................................... 25.7561 24.1767 

1All counties within the State or territory are classified as urban. 

TABLE 4A.—WAGE INDEX AND CAPITAL GEOGRAPHIC ADJUSTMENT FACTOR (GAF) FOR URBAN AREAS BY CBSA 

CBSA code Urban area (constituent counties) Wage 

index GAF 

10180 ....... 2Abilene, TX ..................................................................................................................................................... 0.8038 0.8611 

Callahan County, TX.

Jones County, TX.

Taylor County, TX.

10380 ....... Aguadilla-Isabela-San Sebastia ́n, PR ............................................................................................................... 0.4736 0.5994 

Aguada Municipio, PR.

Aguadilla Municipio, PR.

An ̃asco Municipio, PR.

Isabela Municipio, PR.

Lares Municipio, PR.

Moca Municipio, PR.

Rinco ́n Municipio, PR.

San Sebastia ́n Municipio, PR.

10420 ....... Akron, OH ......................................................................................................................................................... 0.8979 0.9289 

Portage County, OH.

Summit County, OH.

10500 ....... Albany, GA ........................................................................................................................................................ 0.8645 0.9051 

Baker County, GA.

Dougherty County, GA.

Lee County, GA.

Terrell County, GA.

Worth County, GA.

10580 ....... Albany-Schenectady-Troy, NY .......................................................................................................................... 0.8565 0.8994 

Albany County, NY.

Rensselaer County, NY.

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23551 

TABLE 4A.—WAGE INDEX AND CAPITAL GEOGRAPHIC ADJUSTMENT FACTOR (GAF) FOR URBAN AREAS BY CBSA—

Continued 

CBSA code Urban area (constituent counties) Wage 

index GAF 

Saratoga County, NY.

Schenectady County, NY.

Schoharie County, NY.

10740 ....... Albuquerque, NM .............................................................................................................................................. 0.9696 0.9791 

Bernalillo County, NM.

Sandoval County, NM.

Torrance County, NM.

Valencia County, NM.

10780 ....... Alexandria, LA ................................................................................................................................................... 0.8048 0.8618 

Grant Parish, LA.

Rapides Parish, LA.

10900 ....... Allentown-Bethlehem-Easton, PA-NJ (PA Hospitals) ....................................................................................... 0.9844 0.9893 

Warren County, NJ.

Carbon County, PA.

Lehigh County, PA.

Northampton County, PA.

10900 ....... 2Allentown-Bethlehem-Easton, PA-NJ (NJ Hospitals) ..................................................................................... 1.0607 1.0412 

Warren County, NJ.

Carbon County, PA.

Lehigh County, PA.

Northampton County, PA.

11020 ....... Altoona, PA ....................................................................................................................................................... 0.8942 0.9263 

Blair County, PA.

11100 ....... Amarillo, TX ...................................................................................................................................................... 0.9165 0.9420 

Armstrong County, TX.

Carson County, TX.

Potter County, TX.

Randall County, TX.

11180 ....... Ames, IA ........................................................................................................................................................... 0.9546 0.9687 

Story County, IA.

11260 ....... Anchorage, AK .................................................................................................................................................. 1.2110 1.1401 

Anchorage Municipality, AK.

Matanuska-Susitna Borough, AK.

11300 ....... Anderson, IN ..................................................................................................................................................... 0.8634 0.9043 

Madison County, IN.

11340 ....... Anderson, SC .................................................................................................................................................... 0.8887 0.9224 

Anderson County, SC.

11460 ....... Ann Arbor, MI .................................................................................................................................................... 1.0885 1.0598 

Washtenaw County, MI.

11500 ....... Anniston-Oxford, AL .......................................................................................................................................... 0.7702 0.8363 

Calhoun County, AL.

11540 ....... 2Appleton, WI .................................................................................................................................................... 0.9478 0.9640 

Calumet County, WI.

Outagamie County, WI.

11700 ....... Asheville, NC .................................................................................................................................................... 0.9312 0.9524 

Buncombe County, NC.

Haywood County, NC.

Henderson County, NC.

Madison County, NC.

12020 ....... Athens-Clarke County, GA ................................................................................................................................ 0.9813 0.9872 

Clarke County, GA.

Madison County, GA.

Oconee County, GA.

Oglethorpe County, GA.

12060 ....... 1Atlanta-Sandy Springs-Marietta, GA ............................................................................................................... 0.9637 0.9750 

Barrow County, GA.

Bartow County, GA.

Butts County, GA.

Carroll County, GA.

Cherokee County, GA.

Clayton County, GA.

Cobb County, GA.

Coweta County, GA.

Dawson County, GA.

DeKalb County, GA.

Douglas County, GA.

Fayette County, GA.

Forsyth County, GA.

Fulton County, GA.

Gwinnett County, GA.

23552 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

TABLE 4A.—WAGE INDEX AND CAPITAL GEOGRAPHIC ADJUSTMENT FACTOR (GAF) FOR URBAN AREAS BY CBSA—

Continued 

CBSA code Urban area (constituent counties) Wage 

index GAF 

Haralson County, GA.

Heard County, GA.

Henry County, GA.

Jasper County, GA.

Lamar County, GA.

Meriwether County, GA.

Newton County, GA.

Paulding County, GA.

Pickens County, GA.

Pike County, GA.

Rockdale County, GA.

Spalding County, GA.

Walton County, GA.

12100 ....... Atlantic City, NJ ................................................................................................................................................ 1.1618 1.1082 

Atlantic County, NJ.

12220 ....... Auburn-Opelika, AL ........................................................................................................................................... 0.8113 0.8666 

Lee County, AL.

12260 ....... Augusta-Richmond County, GA-SC .................................................................................................................. 0.9567 0.9701 

Burke County, GA.

Columbia County, GA.

McDuffie County, GA.

Richmond County, GA.

Aiken County, SC.

Edgefield County, SC.

12420 ....... 1Austin-Round Rock, TX ................................................................................................................................... 0.9451 0.9621 

Bastrop County, TX.

Caldwell County, TX.

Hays County, TX.

Travis County, TX.

Williamson County, TX.

12540 ....... 2Bakersfield, CA ............................................................................................................................................... 1.0848 1.0573 

Kern County, CA.

12580 ....... 1Baltimore-Towson, MD ................................................................................................................................... 0.9892 0.9926 

Anne Arundel County, MD.

Baltimore County, MD.

Carroll County, MD.

Harford County, MD.

Howard County, MD.

Queen Anne’s County, MD.

Baltimore City, MD.

12620 ....... Bangor, ME ....................................................................................................................................................... 0.9985 0.9990 

Penobscot County, ME.

12700 ....... Barnstable Town, MA ........................................................................................................................................ 1.2518 1.1663 

Barnstable County, MA.

12940 ....... Baton Rouge, LA .............................................................................................................................................. 0.8605 0.9022 

Ascension Parish, LA.

East Baton Rouge Parish, LA.

East Feliciana Parish, LA.

Iberville Parish, LA.

Livingston Parish, LA.

Pointe Coupee Parish, LA.

St. Helena Parish, LA.

West Baton Rouge Parish, LA.

West Feliciana Parish, LA.

12980 ....... Battle Creek, MI ................................................................................................................................................ 0.9492 0.9649 

Calhoun County, MI.

13020 ....... Bay City, MI ...................................................................................................................................................... 0.9535 0.9679 

Bay County, MI.

13140 ....... Beaumont-Port Arthur, TX ................................................................................................................................ 0.8422 0.8890 

Hardin County, TX.

Jefferson County, TX.

Orange County, TX.

13380 ....... Bellingham, WA ................................................................................................................................................ 1.1705 1.1138 

Whatcom County, WA.

13460 ....... Bend, OR .......................................................................................................................................................... 1.0783 1.0530 

Deschutes County, OR.

13644 ....... 1Bethesda-Frederick-Gaithersburg, MD ........................................................................................................... 1.1471 1.0985 

Frederick County, MD.

Montgomery County, MD.

13740 ....... Billings, MT ....................................................................................................................................................... 0.8855 0.9201 

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Continued 

CBSA code Urban area (constituent counties) Wage 

index GAF 

Carbon County, MT.

Yellowstone County, MT.

13780 ....... Binghamton, NY ................................................................................................................................................ 0.8588 0.9010 

Broome County, NY.

Tioga County, NY.

13820 ....... 1Birmingham-Hoover, AL .................................................................................................................................. 0.8979 0.9289 

Bibb County, AL.

Blount County, AL.

Chilton County, AL.

Jefferson County, AL.

St. Clair County, AL.

Shelby County, AL.

Walker County, AL.

13900 ....... Bismarck, ND .................................................................................................................................................... 0.7519 0.8226 

Burleigh County, ND.

Morton County, ND.

13980 ....... 2Blacksburg-Christiansburg-Radford, VA ......................................................................................................... 0.8024 0.8601 

Giles County, VA.

Montgomery County, VA.

Pulaski County, VA.

Radford City, VA.

14020 ....... 2Bloomington, IN .............................................................................................................................................. 0.8632 0.9042 

Greene County, IN.

Monroe County, IN.

Owen County, IN.

14060 ....... Bloomington-Normal, IL .................................................................................................................................... 0.9083 0.9363 

McLean County, IL.

14260 ....... Boise City-Nampa, ID ....................................................................................................................................... 0.9048 0.9338 

Ada County, ID.

Boise County, ID.

Canyon County, ID.

Gem County, ID.

Owyhee County, ID.

14484 ....... 1Boston-Quincy, MA ......................................................................................................................................... 1.1537 1.1029 

Norfolk County, MA.

Plymouth County, MA.

Suffolk County, MA.

14500 ....... Boulder, CO ...................................................................................................................................................... 0.9743 0.9823 

Boulder County, CO.

14540 ....... Bowling Green, KY ........................................................................................................................................... 0.8222 0.8745 

Edmonson County, KY.

Warren County, KY.

14740 ....... Bremerton-Silverdale, WA ................................................................................................................................. 1.0681 1.0461 

Kitsap County, WA.

14860 ....... Bridgeport-Stamford-Norwalk, CT ..................................................................................................................... 1.2607 1.1719 

Fairfield County, CT.

15180 ....... Brownsville-Harlingen, TX ................................................................................................................................. 0.9853 0.9899 

Cameron County, TX.

15260 ....... Brunswick, GA .................................................................................................................................................. 0.9341 0.9544 

Brantley County, GA.

Glynn County, GA.

McIntosh County, GA.

15380 ....... 1Buffalo-Niagara Falls, NY ............................................................................................................................... 0.8888 0.9224 

Erie County, NY.

Niagara County, NY.

15500 ....... Burlington, NC ................................................................................................................................................... 0.8902 0.9234 

Alamance County, NC.

15540 ....... 2Burlington-South Burlington, VT ..................................................................................................................... 1.0199 1.0136 

Chittenden County, VT.

Franklin County, VT.

Grand Isle County, VT.

15764 ....... 1 Cambridge-Newton-Framingham, MA ............................................................................................................ 1.1078 1.0726 

Middlesex County, MA.

15804 ....... 1 2 Camden, NJ .................................................................................................................................................. 1.0607 1.0412 

Burlington County, NJ.

Camden County, NJ.

Gloucester County, NJ.

15940 ....... Canton-Massillon, OH ....................................................................................................................................... 0.8957 0.9273 

Carroll County, OH.

Stark County, OH.

23554 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

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CBSA code Urban area (constituent counties) Wage 

index GAF 

15980 ....... Cape Coral-Fort Myers, FL ............................................................................................................................... 0.9333 0.9538 

Lee County, FL.

16180 ....... Carson City, NV ................................................................................................................................................ 1.0229 1.0156 

Carson City, NV.

16220 ....... 2 Casper, WY ..................................................................................................................................................... 0.9207 0.9450 

Natrona County, WY.

16300 ....... Cedar Rapids, IA .............................................................................................................................................. 0.8605 0.9022 

Benton County, IA.

Jones County, IA.

Linn County, IA.

16580 ....... Champaign-Urbana, IL ...................................................................................................................................... 0.9591 0.9718 

Champaign County, IL.

Ford County, IL.

Piatt County, IL.

16620 ....... Charleston, WV ................................................................................................................................................. 0.8429 0.8896 

Boone County, WV.

Clay County, WV.

Kanawha County, WV.

Lincoln County, WV.

Putnam County, WV.

16700 ....... Charleston-North Charleston, SC ..................................................................................................................... 0.9433 0.9608 

Berkeley County, SC.

Charleston County, SC.

Dorchester County, SC.

16740 ....... 1 Charlotte-Gastonia-Concord, NC-SC .............................................................................................................. 0.9717 0.9805 

Anson County, NC.

Cabarrus County, NC.

Gaston County, NC.

Mecklenburg County, NC.

Union County, NC.

York County, SC.

16820 ....... Charlottesville, VA ............................................................................................................................................. 1.0230 1.0157 

Albemarle County, VA.

Fluvanna County, VA.

Greene County, VA.

Nelson County, VA.

Charlottesville City, VA.

16860 ....... Chattanooga, TN-GA ........................................................................................................................................ 0.9099 0.9374 

Catoosa County, GA.

Dade County, GA.

Walker County, GA.

Hamilton County, TN.

Marion County, TN.

Sequatchie County, TN.

16940 ....... 2 Cheyenne, WY ................................................................................................................................................ 0.9207 0.9450 

Laramie County, WY.

16974 ....... 1 Chicago-Naperville-Joliet, IL ........................................................................................................................... 1.0846 1.0572 

Cook County, IL.

DeKalb County, IL.

DuPage County, IL.

Grundy County, IL.

Kane County, IL.

Kendall County, IL.

McHenry County, IL.

Will County, IL.

17020 ....... 2 Chico, CA ........................................................................................................................................................ 1.0848 1.0573 

Butte County, CA.

17140 ....... 1 Cincinnati-Middletown, OH-KY-IN ................................................................................................................... 0.9604 0.9727 

Dearborn County, IN.

Franklin County, IN.

Ohio County, IN.

Boone County, KY.

Bracken County, KY.

Campbell County, KY.

Gallatin County, KY.

Grant County, KY.

Kenton County, KY.

Pendleton County, KY.

Brown County, OH.

Butler County, OH.

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23555 

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Continued 

CBSA code Urban area (constituent counties) Wage 

index GAF 

Clermont County, OH.

Hamilton County, OH.

Warren County, OH.

17300 ....... Clarksville, TN-KY ............................................................................................................................................. 0.8272 0.8782 

Christian County, KY.

Trigg County, KY.

Montgomery County, TN.

Stewart County, TN.

17420 ....... Cleveland, TN ................................................................................................................................................... 0.8160 0.8700 

Bradley County, TN.

Polk County, TN.

17460 ....... 1 Cleveland-Elyria-Mentor, OH .......................................................................................................................... 0.9197 0.9443 

Cuyahoga County, OH.

Geauga County, OH.

Lake County, OH.

Lorain County, OH.

Medina County, OH.

17660 ....... Coeur d’Alene, ID ............................................................................................................................................. 0.9642 0.9753 

Kootenai County, ID.

17780 ....... College Station-Bryan, TX ................................................................................................................................ 0.8911 0.9241 

Brazos County, TX.

Burleson County, TX.

Robertson County, TX.

17820 ....... Colorado Springs, CO ....................................................................................................................................... 0.9457 0.9625 

El Paso County, CO.

Teller County, CO.

17860 ....... Columbia, MO ................................................................................................................................................... 0.8346 0.8835 

Boone County, MO.

Howard County, MO.

17900 ....... Columbia, SC .................................................................................................................................................... 0.9057 0.9344 

Calhoun County, SC.

Fairfield County, SC.

Kershaw County, SC.

Lexington County, SC.

Richland County, SC.

Saluda County, SC.

17980 ....... Columbus, GA-AL ............................................................................................................................................. 0.8570 0.8997 

Russell County, AL.

Chattahoochee County, GA.

Harris County, GA.

Marion County, GA.

Muscogee County, GA.

18020 ....... Columbus, IN .................................................................................................................................................... 0.9596 0.9722 

Bartholomew County, IN.

18140 ....... 1 Columbus, OH ................................................................................................................................................ 0.9848 0.9896 

Delaware County, OH.

Fairfield County, OH.

Franklin County, OH.

Licking County, OH.

Madison County, OH.

Morrow County, OH.

Pickaway County, OH.

Union County, OH.

18580 ....... Corpus Christi, TX ............................................................................................................................................. 0.8557 0.8988 

Aransas County, TX.

Nueces County, TX.

San Patricio County, TX.

18700 ....... Corvallis, OR ..................................................................................................................................................... 1.0711 1.0482 

Benton County, OR.

19060 ....... Cumberland, MD-WV ........................................................................................................................................ 0.9310 0.9522 

Allegany County, MD.

Mineral County, WV.

19124 ....... 1 Dallas-Plano-Irving, TX ................................................................................................................................... 1.0226 1.0154 

Collin County, TX.

Dallas County, TX.

Delta County, TX.

Denton County, TX.

Ellis County, TX.

Hunt County, TX.

Kaufman County, TX.

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Continued 

CBSA code Urban area (constituent counties) Wage 

index GAF 

Rockwall County, TX.

19140 ....... Dalton, GA ........................................................................................................................................................ 0.9033 0.9327 

Murray County, GA.

Whitfield County, GA.

19180 ....... Danville, IL ........................................................................................................................................................ 0.9048 0.9338 

Vermilion County, IL.

19260 ....... Danville, VA ...................................................................................................................................................... 0.8514 0.8957 

Pittsylvania County, VA.

Danville City, VA.

19340 ....... Davenport-Moline-Rock Island, IA-IL ................................................................................................................ 0.8716 0.9102 

Henry County, IL.

Mercer County, IL.

Rock Island County, IL.

Scott County, IA.

19380 ....... Dayton, OH ....................................................................................................................................................... 0.9069 0.9353 

Greene County, OH.

Miami County, OH.

Montgomery County, OH.

Preble County, OH.

19460 ....... Decatur, AL ....................................................................................................................................................... 0.8517 0.8959 

Lawrence County, AL.

Morgan County, AL.

19500 ....... 2 Decatur, IL ...................................................................................................................................................... 0.8285 0.8791 

Macon County, IL.

19660 ....... Deltona-Daytona Beach-Ormond Beach, FL .................................................................................................... 0.9307 0.9520 

Volusia County, FL.

19740 ....... 1 Denver-Aurora, CO ......................................................................................................................................... 1.0710 1.0481 

Adams County, CO.

Arapahoe County, CO.

Broomfield County, CO.

Clear Creek County, CO.

Denver County, CO.

Douglas County, CO.

Elbert County, CO.

Gilpin County, CO.

Jefferson County, CO.

Park County, CO.

19780 ....... Des Moines, IA ................................................................................................................................................. 0.9650 0.9759 

Dallas County, IA.

Guthrie County, IA.

Madison County, IA.

Polk County, IA.

Warren County, IA.

19804 ....... 1 Detroit-Livonia-Dearborn, MI ........................................................................................................................... 1.0453 1.0308 

Wayne County, MI.

20020 ....... Dothan, AL ........................................................................................................................................................ 0.7743 0.8393 

Geneva County, AL.

Henry County, AL.

Houston County, AL.

20100 ....... Dover, DE ......................................................................................................................................................... 0.9821 0.9877 

Kent County, DE.

20220 ....... Dubuque, IA ...................................................................................................................................................... 0.9116 0.9386 

Dubuque County, IA.

20260 ....... Duluth, MN-WI .................................................................................................................................................. 1.0224 1.0153 

Carlton County, MN.

St. Louis County, MN.

Douglas County, WI.

20500 ....... Durham, NC ...................................................................................................................................................... 1.0260 1.0177 

Chatham County, NC.

Durham County, NC.

Orange County, NC.

Person County, NC.

20740 ....... 2Eau Claire, WI ................................................................................................................................................. 0.9478 0.9640 

Chippewa County, WI.

Eau Claire County, WI.

20764 ....... 1Edison, NJ ....................................................................................................................................................... 1.1301 1.0874 

Middlesex County, NJ.

Monmouth County, NJ.

Ocean County, NJ.

Somerset County, NJ.

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23557 

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CBSA code Urban area (constituent counties) Wage 

index GAF 

20940 ....... 2El Centro, CA .................................................................................................................................................. 1.0848 1.0573 

Imperial County, CA.

21060 ....... Elizabethtown, KY ............................................................................................................................................. 0.8816 0.9173 

Hardin County, KY.

Larue County, KY.

21140 ....... Elkhart-Goshen, IN ........................................................................................................................................... 0.9616 0.9735 

Elkhart County, IN.

21300 ....... Elmira, NY ......................................................................................................................................................... 0.8276 0.8785 

Chemung County, NY.

21340 ....... El Paso, TX ....................................................................................................................................................... 0.8954 0.9271 

El Paso County, TX.

21500 ....... Erie, PA ............................................................................................................................................................. 0.8746 0.9123 

Erie County, PA.

21604 ....... Essex County, MA ............................................................................................................................................ 1.0525 1.0357 

Essex County, MA.

21660 ....... Eugene-Springfield, OR .................................................................................................................................... 1.0810 1.0548 

Lane County, OR.

21780 ....... Evansville, IN-KY .............................................................................................................................................. 0.8735 0.9115 

Gibson County, IN.

Posey County, IN.

Vanderburgh County, IN.

Warrick County, IN.

Henderson County, KY.

Webster County, KY.

21820 ....... 2Fairbanks, AK ................................................................................................................................................. 1.1977 1.1315 

Fairbanks North Star Borough, AK.

21940 ....... Fajardo, PR ....................................................................................................................................................... 0.4160 0.5485 

Ceiba Municipio, PR.

Fajardo Municipio, PR.

Luquillo Municipio, PR.

22020 ....... Fargo, ND-MN (ND Hospitals) .......................................................................................................................... 0.8778 0.9146 

Clay County, MN.

Cass County, ND.

22020 ....... 2Fargo, ND-MN (MN Hospitals) ....................................................................................................................... 0.9183 0.9433 

Clay County, MN.

Cass County, ND.

22140 ....... 2Farmington, NM .............................................................................................................................................. 0.8649 0.9054 

San Juan County, NM.

22180 ....... Fayetteville, NC ................................................................................................................................................. 0.9426 0.9603 

Cumberland County, NC.

Hoke County, NC.

22220 ....... Fayetteville-Springdale-Rogers, AR-MO ........................................................................................................... 0.8615 0.9029 

Benton County, AR.

Madison County, AR.

Washington County, AR.

McDonald County, MO.

22380 ....... Flagstaff, AZ ...................................................................................................................................................... 1.2094 1.1391 

Coconino County, AZ.

22420 ....... Flint, MI ............................................................................................................................................................. 1.0654 1.0443 

Genesee County, MI.

22500 ....... Florence, SC ..................................................................................................................................................... 0.8988 0.9295 

Darlington County, SC.

Florence County, SC.

22520 ....... Florence-Muscle Shoals, AL ............................................................................................................................. 0.8305 0.8806 

Colbert County, AL.

Lauderdale County, AL.

22540 ....... Fond du Lac, WI ............................................................................................................................................... 0.9649 0.9758 

Fond du Lac County, WI.

22660 ....... Fort Collins-Loveland, CO ................................................................................................................................. 1.0146 1.0100 

Larimer County, CO.

22744 ....... 1Fort Lauderdale-Pompano Beach-Deerfield Beach, FL ................................................................................. 1.0508 1.0345 

Broward County, FL.

22900 ....... Fort Smith, AR-OK ............................................................................................................................................ 0.8231 0.8752 

Crawford County, AR.

Franklin County, AR.

Sebastian County, AR.

Le Flore County, OK.

Sequoyah County, OK.

23020 ....... Fort Walton Beach-Crestview-Destin, FL ......................................................................................................... 0.8877 0.9217 

Okaloosa County, FL.

23558 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

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Continued 

CBSA code Urban area (constituent counties) Wage 

index GAF 

23060 ....... Fort Wayne, IN .................................................................................................................................................. 0.9797 0.9861 

Allen County, IN.

Wells County, IN.

Whitley County, IN.

23104 ....... 1Fort Worth-Arlington, TX ................................................................................................................................. 0.9514 0.9665 

Johnson County, TX.

Parker County, TX.

Tarrant County, TX.

Wise County, TX.

23420 ....... 2Fresno, CA ...................................................................................................................................................... 1.0848 1.0573 

Fresno County, CA.

23460 ....... Gadsden, AL ..................................................................................................................................................... 0.7974 0.8564 

Etowah County, AL.

23540 ....... Gainesville, FL .................................................................................................................................................. 0.9461 0.9628 

Alachua County, FL.

Gilchrist County, FL.

23580 ....... Gainesville, GA ................................................................................................................................................. 0.8897 0.9231 

Hall County, GA.

23844 ....... Gary, IN ............................................................................................................................................................. 0.9366 0.9561 

Jasper County, IN.

Lake County, IN.

Newton County, IN.

Porter County, IN.

24020 ....... Glens Falls, NY ................................................................................................................................................. 0.8587 0.9009 

Warren County, NY.

Washington County, NY.

24140 ....... Goldsboro, NC .................................................................................................................................................. 0.8781 0.9148 

Wayne County, NC.

24220 ....... Grand Forks, ND-MN ........................................................................................................................................ 1.1521 1.1018 

Polk County, MN.

Grand Forks County, ND.

24300 ....... Grand Junction, CO .......................................................................................................................................... 0.9590 0.9717 

Mesa County, CO.

24340 ....... Grand Rapids-Wyoming, MI .............................................................................................................................. 0.9398 0.9584 

Barry County, MI.

Ionia County, MI.

Kent County, MI.

Newaygo County, MI.

24500 ....... Great Falls, MT ................................................................................................................................................. 0.9074 0.9356 

Cascade County, MT.

24540 ....... Greeley, CO ...................................................................................................................................................... 0.9597 0.9722 

Weld County, CO.

24580 ....... 2Green Bay, WI ................................................................................................................................................ 0.9478 0.9640 

Brown County, WI.

Kewaunee County, WI.

Oconto County, WI.

24660 ....... Greensboro-High Point, NC .............................................................................................................................. 0.9133 0.9398 

Guilford County, NC.

Randolph County, NC.

Rockingham County, NC.

24780 ....... Greenville, NC ................................................................................................................................................... 0.9414 0.9595 

Greene County, NC.

Pitt County, NC.

24860 ....... Greenville, SC ................................................................................................................................................... 1.0138 1.0094 

Greenville County, SC.

Laurens County, SC.

Pickens County, SC.

25020 ....... Guayama, PR ................................................................................................................................................... 0.3186 0.4569 

Arroyo Municipio, PR.

Guayama Municipio, PR.

Patillas Municipio, PR.

25060 ....... Gulfport-Biloxi, MS ............................................................................................................................................ 0.8922 0.9249 

Hancock County, MS.

Harrison County, MS.

Stone County, MS.

25180 ....... Hagerstown-Martinsburg, MD-WV .................................................................................................................... 0.9528 0.9674 

Washington County, MD.

Berkeley County, WV.

Morgan County, WV.

25260 ....... 2 Hanford-Corcoran, CA .................................................................................................................................... 1.0848 1.0573 

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Continued 

CBSA code Urban area (constituent counties) Wage 

index GAF 

Kings County, CA.

25420 ....... Harrisburg-Carlisle, PA ..................................................................................................................................... 0.9317 0.9527 

Cumberland County, PA.

Dauphin County, PA.

Perry County, PA.

25500 ....... Harrisonburg, VA .............................................................................................................................................. 0.9101 0.9375 

Rockingham County, VA.

Harrisonburg City, VA.

25540 ....... 1 2 Hartford-West Hartford-East Hartford, CT .................................................................................................... 1.1790 1.1194 

Hartford County, CT.

Litchfield County, CT.

Middlesex County, CT.

Tolland County, CT.

25620 ....... 2 Hattiesburg, MS .............................................................................................................................................. 0.7685 0.8350 

Forrest County, MS.

Lamar County, MS.

Perry County, MS.

25860 ....... Hickory-Lenoir-Morganton, NC ......................................................................................................................... 0.8931 0.9255 

Alexander County, NC.

Burke County, NC.

Caldwell County, NC.

Catawba County, NC.

25980 ....... Hinesville-Fort Stewart, GA ............................................................................................................................... 0.7684 0.8349 

Liberty County, GA.

Long County, GA.

26100 ....... Holland-Grand Haven, MI ................................................................................................................................. 0.9133 0.9398 

Ottawa County, MI.

26180 ....... Honolulu, HI ...................................................................................................................................................... 1.1206 1.0811 

Honolulu County, HI.

26300 ....... Hot Springs, AR ................................................................................................................................................ 0.9066 0.9351 

Garland County, AR.

26380 ....... Houma-Bayou Cane-Thibodaux, LA ................................................................................................................. 0.7903 0.8512 

Lafourche Parish, LA.

Terrebonne Parish, LA.

26420 ....... 1 Houston-Baytown-Sugar Land, TX ................................................................................................................. 1.0008 1.0005 

Austin County, TX.

Brazoria County, TX.

Chambers County, TX.

Fort Bend County, TX.

Galveston County, TX.

Harris County, TX.

Liberty County, TX.

Montgomery County, TX.

San Jacinto County, TX.

Waller County, TX.

26580 ....... Huntington-Ashland, WV-KY-OH ...................................................................................................................... 0.9482 0.9642 

Boyd County, KY.

Greenup County, KY.

Lawrence County, OH.

Cabell County, WV.

Wayne County, WV.

26620 ....... Huntsville, AL .................................................................................................................................................... 0.9124 0.9391 

Limestone County, AL.

Madison County, AL.

26820 ....... Idaho Falls, ID ................................................................................................................................................... 0.9409 0.9591 

Bonneville County, ID.

Jefferson County, ID.

26900 ....... 1 Indianapolis, IN ............................................................................................................................................... 0.9922 0.9947 

Boone County, IN.

Brown County, IN.

Hamilton County, IN.

Hancock County, IN.

Hendricks County, IN.

Johnson County, IN.

Marion County, IN.

Morgan County, IN.

Putnam County, IN.

Shelby County, IN.

26980 ....... Iowa City, IA ...................................................................................................................................................... 0.9751 0.9829 

Johnson County, IA.

23560 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

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Continued 

CBSA code Urban area (constituent counties) Wage 

index GAF 

Washington County, IA.

27060 ....... Ithaca, NY ......................................................................................................................................................... 0.9855 0.9900 

Tompkins County, NY.

27100 ....... Jackson, MI ....................................................................................................................................................... 0.9300 0.9515 

Jackson County, MI.

27140 ....... Jackson, MS ..................................................................................................................................................... 0.8313 0.8812 

Copiah County, MS.

Hinds County, MS.

Madison County, MS.

Rankin County, MS.

Simpson County, MS.

27180 ....... Jackson, TN ...................................................................................................................................................... 0.8964 0.9278 

Chester County, TN.

Madison County, TN.

27260 ....... 1 Jacksonville, FL .............................................................................................................................................. 0.9303 0.9517 

Baker County, FL.

Clay County, FL.

Duval County, FL.

Nassau County, FL.

St. Johns County, FL.

27340 ....... 2 Jacksonville, NC ............................................................................................................................................. 0.8570 0.8997 

Onslow County, NC.

27500 ....... Janesville, WI .................................................................................................................................................... 0.9561 0.9697 

Rock County, WI.

27620 ....... Jefferson City, MO ............................................................................................................................................ 0.8389 0.8867 

Callaway County, MO.

Cole County, MO.

Moniteau County, MO.

Osage County, MO.

27740 ....... Johnson City, TN .............................................................................................................................................. 0.7958 0.8552 

Carter County, TN.

Unicoi County, TN.

Washington County, TN.

27780 ....... Johnstown, PA .................................................................................................................................................. 0.8348 0.8837 

Cambria County, PA.

27860 ....... Jonesboro, AR .................................................................................................................................................. 0.7968 0.8559 

Craighead County, AR.

Poinsett County, AR.

27900 ....... Joplin, MO ......................................................................................................................................................... 0.8594 0.9014 

Jasper County, MO.

Newton County, MO.

28020 ....... Kalamazoo-Portage, MI .................................................................................................................................... 1.0403 1.0274 

Kalamazoo County, MI.

Van Buren County, MI.

28100 ....... Kankakee-Bradley, IL ........................................................................................................................................ 1.0991 1.0668 

Kankakee County, IL.

28140 ....... 1Kansas City, MO-KS ....................................................................................................................................... 0.9454 0.9623 

Franklin County, KS.

Johnson County, KS.

Leavenworth County, KS.

Linn County, KS.

Miami County, KS.

Wyandotte County, KS.

Bates County, MO.

Caldwell County, MO.

Cass County, MO.

Clay County, MO.

Clinton County, MO.

Jackson County, MO.

Lafayette County, MO.

Platte County, MO.

Ray County, MO.

28420 ....... Kennewick-Richland-Pasco, WA ....................................................................................................................... 1.0619 1.0420 

Benton County, WA.

Franklin County, WA.

28660 ....... Killeen-Temple-Fort Hood, TX .......................................................................................................................... 0.8566 0.8994 

Bell County, TX.

Coryell County, TX.

Lampasas County, TX.

28700 ....... Kingsport-Bristol-Bristol, TN-VA ........................................................................................................................ 0.8095 0.8653 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23561 

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Continued 

CBSA code Urban area (constituent counties) Wage 

index GAF 

Hawkins County, TN.

Sullivan County, TN.

Bristol City, VA.

Scott County, VA.

Washington County, VA.

28740 ....... Kingston, NY ..................................................................................................................................................... 0.9260 0.9487 

Ulster County, NY.

28940 ....... Knoxville, TN ..................................................................................................................................................... 0.8470 0.8925 

Anderson County, TN.

Blount County, TN.

Knox County, TN.

Loudon County, TN.

Union County, TN.

29020 ....... Kokomo, IN ....................................................................................................................................................... 0.9555 0.9693 

Howard County, IN.

Tipton County, IN.

29100 ....... La Crosse, WI-MN ............................................................................................................................................ 0.9557 0.9694 

Houston County, MN.

La Crosse County, WI.

29140 ....... Lafayette, IN ...................................................................................................................................................... 0.8730 0.9112 

Benton County, IN.

Carroll County, IN.

Tippecanoe County, IN.

29180 ....... Lafayette, LA ..................................................................................................................................................... 0.8429 0.8896 

Lafayette Parish, LA.

St. Martin Parish, LA.

29340 ....... Lake Charles, LA .............................................................................................................................................. 0.7847 0.8470 

Calcasieu Parish, LA.

Cameron Parish, LA.

29404 ....... Lake County-Kenosha County, IL-WI ............................................................................................................... 1.0444 1.0302 

Lake County, IL.

Kenosha County, WI.

29460 ....... Lakeland, FL ..................................................................................................................................................... 0.8934 0.9257 

Polk County, FL.

29540 ....... Lancaster, PA ................................................................................................................................................... 0.9716 0.9805 

Lancaster County, PA.

29620 ....... Lansing-East Lansing, MI ................................................................................................................................. 0.9786 0.9853 

Clinton County, MI.

Eaton County, MI.

Ingham County, MI.

29700 ....... Laredo, TX ........................................................................................................................................................ 0.8101 0.8657 

Webb County, TX.

29740 ....... 2 Las Cruces, NM .............................................................................................................................................. 0.8649 0.9054 

Dona Ana County, NM.

29820 ....... 1 Las Vegas-Paradise, NV ................................................................................................................................ 1.1416 1.0949 

Clark County, NV.

29940 ....... Lawrence, KS .................................................................................................................................................... 0.8538 0.8974 

Douglas County, KS.

30020 ....... Lawton, OK ....................................................................................................................................................... 0.7916 0.8521 

Comanche County, OK.

30140 ....... Lebanon, PA ..................................................................................................................................................... 0.8654 0.9057 

Lebanon County, PA.

30300 ....... Lewiston, ID-WA (ID Hospitals) ........................................................................................................................ 0.9878 0.9916 

Nez Perce County, ID.

Asotin County, WA.

30300 ....... 2 Lewiston, ID-WA (WA Hospitals) .................................................................................................................... 1.0459 1.0312 

Nez Perce County, ID.

Asotin County, WA.

30340 ....... Lewiston-Auburn, ME ........................................................................................................................................ 0.9332 0.9538 

Androscoggin County, ME.

30460 ....... Lexington-Fayette, KY ...................................................................................................................................... 0.9060 0.9346 

Bourbon County, KY.

Clark County, KY.

Fayette County, KY.

Jessamine County, KY.

Scott County, KY.

Woodford County, KY.

30620 ....... Lima, OH ........................................................................................................................................................... 0.9263 0.9489 

Allen County, OH.

30700 ....... Lincoln, NE ........................................................................................................................................................ 1.0197 1.0134 

23562 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

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Continued 

CBSA code Urban area (constituent counties) Wage 

index GAF 

Lancaster County, NE.

Seward County, NE.

30780 ....... Little Rock-North Little Rock, AR ...................................................................................................................... 0.8768 0.9139 

Faulkner County, AR.

Grant County, AR.

Lonoke County, AR.

Perry County, AR.

Pulaski County, AR.

Saline County, AR.

30860 ....... Logan, UT-ID .................................................................................................................................................... 0.9183 0.9433 

Franklin County, ID.

Cache County, UT.

30980 ....... Longview, TX .................................................................................................................................................... 0.8741 0.9120 

Gregg County, TX.

Rusk County, TX.

Upshur County, TX.

31020 ....... 2 Longview, WA ................................................................................................................................................. 1.0459 1.0312 

Cowlitz County, WA.

31084 ....... 1 Los Angeles-Long Beach-Glendale, CA ......................................................................................................... 1.1762 1.1175 

Los Angeles County, CA.

31140 ....... 1 Louisville, KY-IN .............................................................................................................................................. 0.9264 0.9490 

Clark County, IN.

Floyd County, IN.

Harrison County, IN.

Washington County, IN.

Bullitt County, KY.

Henry County, KY.

Jefferson County, KY.

Meade County, KY.

Nelson County, KY.

Oldham County, KY.

Shelby County, KY.

Spencer County, KY.

Trimble County, KY.

31180 ....... Lubbock, TX ...................................................................................................................................................... 0.8790 0.9155 

Crosby County, TX.

Lubbock County, TX.

31340 ....... Lynchburg, VA .................................................................................................................................................. 0.8706 0.9095 

Amherst County, VA.

Appomattox County, VA.

Bedford County, VA.

Campbell County, VA.

Bedford City, VA.

Lynchburg City, VA.

31420 ....... Macon, GA ........................................................................................................................................................ 0.9485 0.9644 

Bibb County, GA.

Crawford County, GA.

Jones County, GA.

Monroe County, GA.

Twiggs County, GA.

31460 ....... 2 Madera, CA ..................................................................................................................................................... 1.0848 1.0573 

Madera County, CA.

31540 ....... Madison, WI ...................................................................................................................................................... 1.0629 1.0427 

Columbia County, WI.

Dane County, WI.

Iowa County, WI.

31700 ....... 2 Manchester-Nashua, NH ................................................................................................................................ 1.0668 1.0453 

Hillsborough County, NH.

Merrimack County, NH.

31900 ....... Mansfield, OH ................................................................................................................................................... 0.8788 0.9153 

Richland County, OH.

32420 ....... Mayagu ̈ez, PR .................................................................................................................................................. 0.4016 0.5354 

Hormigueros Municipio, PR.

Mayagu ̈ez Municipio, PR.

32580 ....... McAllen-Edinburg-Pharr, TX ............................................................................................................................. 0.8945 0.9265 

Hidalgo County, TX.

32780 ....... 2 Medford, OR ................................................................................................................................................... 1.0284 1.0194 

Jackson County, OR.

32820 ....... 1 Memphis, TN-MS-AR ...................................................................................................................................... 0.9346 0.9547 

Crittenden County, AR.

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Continued 

CBSA code Urban area (constituent counties) Wage 

index GAF 

DeSoto County, MS.

Marshall County, MS.

Tate County, MS.

Tunica County, MS.

Fayette County, TN.

Shelby County, TN.

Tipton County, TN.

32900 ....... Merced, CA ....................................................................................................................................................... 1.1123 1.0756 

Merced County, CA.

33124 ....... 1 Miami-Miami Beach-Kendall, FL ..................................................................................................................... 0.9757 0.9833 

Miami-Dade County, FL.

33140 ....... Michigan City-La Porte, IN ................................................................................................................................ 0.9409 0.9591 

LaPorte County, IN.

33260 ....... Midland, TX ....................................................................................................................................................... 0.9522 0.9670 

Midland County, TX.

33340 ....... 1 Milwaukee-Waukesha-West Allis, WI ............................................................................................................. 1.0111 1.0076 

Milwaukee County, WI.

Ozaukee County, WI.

Washington County, WI.

Waukesha County, WI.

33460 ....... 1 Minneapolis-St. Paul-Bloomington, MN-WI .................................................................................................... 1.1055 1.0711 

Anoka County, MN.

Carver County, MN.

Chisago County, MN.

Dakota County, MN.

Hennepin County, MN.

Isanti County, MN.

Ramsey County, MN.

Scott County, MN.

Sherburne County, MN.

Washington County, MN.

Wright County, MN.

Pierce County, WI.

St. Croix County, WI.

33540 ....... Missoula, MT ..................................................................................................................................................... 0.9535 0.9679 

Missoula County, MT.

33660 ....... Mobile, AL ......................................................................................................................................................... 0.7902 0.8511 

Mobile County, AL.

33700 ....... Modesto, CA ..................................................................................................................................................... 1.1885 1.1255 

Stanislaus County, CA.

33740 ....... Monroe, LA ....................................................................................................................................................... 0.8044 0.8615 

Ouachita Parish, LA.

Union Parish, LA.

33780 ....... Monroe, MI ........................................................................................................................................................ 0.9468 0.9633 

Monroe County, MI.

33860 ....... Montgomery, AL ................................................................................................................................................ 0.8600 0.9019 

Autauga County, AL.

Elmore County, AL.

Lowndes County, AL.

Montgomery County, AL.

34060 ....... Morgantown, WV .............................................................................................................................................. 0.8439 0.8903 

Monongalia County, WV.

Preston County, WV.

34100 ....... Morristown, TN .................................................................................................................................................. 0.8758 0.9132 

Grainger County, TN.

Hamblen County, TN.

Jefferson County, TN.

34580 ....... 2 Mount Vernon-Anacortes, WA ........................................................................................................................ 1.0459 1.0312 

Skagit County, WA.

34620 ....... Muncie, IN ......................................................................................................................................................... 0.8952 0.9270 

Delaware County, IN.

34740 ....... Muskegon-Norton Shores, MI ........................................................................................................................... 0.9677 0.9778 

Muskegon County, MI.

34820 ....... Myrtle Beach-Conway-North Myrtle Beach, SC ............................................................................................... 0.8869 0.9211 

Horry County, SC.

34900 ....... Napa, CA .......................................................................................................................................................... 1.2643 1.1742 

Napa County, CA.

34940 ....... Naples-Marco Island, FL ................................................................................................................................... 1.0115 1.0079 

Collier County, FL.

34980 ....... 1 Nashville-Davidson—Murfreesboro, TN ......................................................................................................... 0.9757 0.9833 

23564 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

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CBSA code Urban area (constituent counties) Wage 

index GAF 

Cannon County, TN.

Cheatham County, TN.

Davidson County, TN.

Dickson County, TN.

Hickman County, TN.

Macon County, TN.

Robertson County, TN.

Rutherford County, TN.

Smith County, TN.

Sumner County, TN.

Trousdale County, TN.

Williamson County, TN.

Wilson County, TN.

35004 ....... 1 Nassau-Suffolk, NY ......................................................................................................................................... 1.2781 1.1830 

Nassau County, NY.

Suffolk County, NY.

35084 ....... 1 Newark-Union, NJ-PA ..................................................................................................................................... 1.2192 1.1454 

Essex County, NJ.

Hunterdon County, NJ.

Morris County, NJ.

Sussex County, NJ.

Union County, NJ.

Pike County, PA.

35300 ....... 2 New Haven-Milford, CT .................................................................................................................................. 1.1790 1.1194 

New Haven County, CT.

35380 ....... 1 New Orleans-Metairie-Kenner, LA .................................................................................................................. 0.9003 0.9306 

Jefferson Parish, LA.

Orleans Parish, LA.

Plaquemines Parish, LA.

St. Bernard Parish, LA.

St. Charles Parish, LA.

St. John the Baptist Parish, LA.

St. Tammany Parish, LA.

35644 ....... 1 New York-Wayne-White Plains, NY-NJ .......................................................................................................... 1.3191 1.2088 

Bergen County, NJ.

Hudson County, NJ.

Passaic County, NJ.

Bronx County, NY.

Kings County, NY.

New York County, NY.

Putnam County, NY.

Queens County, NY.

Richmond County, NY.

Rockland County, NY.

Westchester County, NY.

35660 ....... 2 Niles-Benton Harbor, MI ................................................................................................................................. 0.8923 0.9249 

Berrien County, MI.

35980 ....... 2 Norwich-New London, CT ............................................................................................................................... 1.1790 1.1194 

New London County, CT.

36084 ....... 1Oakland-Fremont-Hayward, CA ...................................................................................................................... 1.5474 1.3485 

Alameda County, CA.

Contra Costa County, CA.

36100 ....... Ocala, FL .......................................................................................................................................................... 0.8955 0.9272 

Marion County, FL.

36140 ....... Ocean City, NJ .................................................................................................................................................. 1.1031 1.0695 

Cape May County, NJ.

36220 ....... Odessa, TX ....................................................................................................................................................... 0.9893 0.9927 

Ector County, TX.

36260 ....... Ogden-Clearfield, UT ........................................................................................................................................ 0.9048 0.9338 

Davis County, UT.

Morgan County, UT.

Weber County, UT.

36420 ....... 1Oklahoma City, OK ......................................................................................................................................... 0.9043 0.9334 

Canadian County, OK.

Cleveland County, OK.

Grady County, OK.

Lincoln County, OK.

Logan County, OK.

McClain County, OK.

Oklahoma County, OK.

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23565 

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Continued 

CBSA code Urban area (constituent counties) Wage 

index GAF 

36500 ....... Olympia, WA ..................................................................................................................................................... 1.0970 1.0655 

Thurston County, WA.

36540 ....... Omaha-Council Bluffs, NE-IA ........................................................................................................................... 0.9555 0.9693 

Harrison County, IA.

Mills County, IA.

Pottawattamie County, IA.

Cass County, NE.

Douglas County, NE.

Sarpy County, NE.

Saunders County, NE.

Washington County, NE.

36740 ....... 1Orlando, FL ..................................................................................................................................................... 0.9446 0.9617 

Lake County, FL.

Orange County, FL.

Osceola County, FL.

Seminole County, FL.

36780 ....... 2Oshkosh-Neenah, WI ...................................................................................................................................... 0.9478 0.9640 

Winnebago County, WI.

36980 ....... Owensboro, KY ................................................................................................................................................. 0.8806 0.9166 

Daviess County, KY.

Hancock County, KY.

McLean County, KY.

37100 ....... Oxnard-Thousand Oaks-Ventura, CA ............................................................................................................... 1.1604 1.1072 

Ventura County, CA.

37340 ....... Palm Bay-Melbourne-Titusville, FL ................................................................................................................... 0.9826 0.9881 

Brevard County, FL.

37460 ....... 2Panama City-Lynn Haven, FL ........................................................................................................................ 0.8613 0.9028 

Bay County, FL.

37620 ....... Parkersburg-Marietta, WV-OH (WV Hospitals) ................................................................................................. 0.8303 0.8804 

Washington County, OH.

Pleasants County, WV.

Wirt County, WV.

Wood County, WV.

37620 ....... 2Parkersburg-Marietta, WV-OH (OH Hospitals) ............................................................................................... 0.8788 0.9153 

Washington County, OH.

Pleasants County, WV.

Wirt County, WV.

Wood County, WV.

37700 ....... Pascagoula, MS ................................................................................................................................................ 0.8164 0.8703 

George County, MS.

Jackson County, MS.

37860 ....... 2Pensacola-Ferry Pass-Brent, FL .................................................................................................................... 0.8613 0.9028 

Escambia County, FL.

Santa Rosa County, FL.

37900 ....... Peoria, IL ........................................................................................................................................................... 0.8844 0.9193 

Marshall County, IL.

Peoria County, IL.

Stark County, IL.

Tazewell County, IL.

Woodford County, IL.

37964 ....... 1Philadelphia, PA .............................................................................................................................................. 1.1030 1.0694 

Bucks County, PA.

Chester County, PA.

Delaware County, PA.

Montgomery County, PA.

Philadelphia County, PA.

38060 ....... 1Phoenix-Mesa-Scottsdale, AZ ........................................................................................................................ 1.0139 1.0095 

Maricopa County, AZ.

Pinal County, AZ.

38220 ....... Pine Bluff, AR ................................................................................................................................................... 0.8716 0.9102 

Cleveland County, AR.

Jefferson County, AR.

Lincoln County, AR.

38300 ....... 1Pittsburgh, PA ................................................................................................................................................. 0.8840 0.9190 

Allegheny County, PA.

Armstrong County, PA.

Beaver County, PA.

Butler County, PA.

Fayette County, PA.

Washington County, PA.

23566 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

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CBSA code Urban area (constituent counties) Wage 

index GAF 

Westmoreland County, PA.

38340 ....... Pittsfield, MA ..................................................................................................................................................... 1.0183 1.0125 

Berkshire County, MA.

38540 ....... Pocatello, ID ...................................................................................................................................................... 0.9348 0.9549 

Bannock County, ID.

Power County, ID.

38660 ....... Ponce, PR ......................................................................................................................................................... 0.5178 0.6372 

Juana D ́ıaz Municipio, PR.

Ponce Municipio, PR.

Villalba Municipio, PR.

38860 ....... Portland-South Portland-Biddeford, ME ............................................................................................................ 1.0382 1.0260 

Cumberland County, ME.

Sagadahoc County, ME.

York County, ME.

38900 ....... 1Portland-Vancouver-Beaverton, OR-WA ........................................................................................................ 1.1229 1.0826 

Clackamas County, OR.

Columbia County, OR.

Multnomah County, OR.

Washington County, OR.

Yamhill County, OR.

Clark County, WA.

Skamania County, WA.

38940 ....... Port St. Lucie-Fort Pierce, FL ........................................................................................................................... 1.0162 1.0111 

Martin County, FL.

St. Lucie County, FL.

39100 ....... Poughkeepsie-Newburgh-Middletown, NY ....................................................................................................... 1.0767 1.0519 

Dutchess County, NY.

Orange County, NY.

39140 ....... Prescott, AZ ...................................................................................................................................................... 0.9884 0.9920 

Yavapai County, AZ.

39300 ....... 1Providence-New Bedford-Fall River, RI-MA ................................................................................................... 1.0952 1.0643 

Bristol County, MA.

Bristol County, RI.

Kent County, RI.

Newport County, RI.

Providence County, RI.

Washington County, RI.

39340 ....... Provo-Orem, UT ................................................................................................................................................ 0.9578 0.9709 

Juab County, UT.

Utah County, UT.

39380 ....... 2Pueblo, CO ..................................................................................................................................................... 0.9379 0.9570 

Pueblo County, CO.

39460 ....... Punta Gorda, FL ............................................................................................................................................... 0.9274 0.9497 

Charlotte County, FL.

39540 ....... 2 Racine, WI ...................................................................................................................................................... 0.9478 0.9640 

Racine County, WI.

39580 ....... Raleigh-Cary, NC .............................................................................................................................................. 0.9709 0.9800 

Franklin County, NC.

Johnston County, NC.

Wake County, NC.

39660 ....... Rapid City, SD .................................................................................................................................................. 0.9027 0.9323 

Meade County, SD.

Pennington County, SD.

39740 ....... Reading, PA ...................................................................................................................................................... 0.9698 0.9792 

Berks County, PA.

39820 ....... Redding, CA ...................................................................................................................................................... 1.2207 1.1463 

Shasta County, CA.

39900 ....... Reno-Sparks, NV .............................................................................................................................................. 1.0984 1.0664 

Storey County, NV.

Washoe County, NV.

40060 ....... 1 Richmond, VA ................................................................................................................................................. 0.9319 0.9528 

Amelia County, VA.

Caroline County, VA.

Charles City County, VA.

Chesterfield County, VA.

Cumberland County, VA.

Dinwiddie County, VA.

Goochland County, VA.

Hanover County, VA.

Henrico County, VA.

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23567 

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CBSA code Urban area (constituent counties) Wage 

index GAF 

King and Queen County, VA.

King William County, VA.

Louisa County, VA.

New Kent County, VA.

Powhatan County, VA.

Prince George County, VA.

Sussex County, VA.

Colonial Heights City, VA.

Hopewell City, VA.

Petersburg City, VA.

Richmond City, VA.

40140 ....... 1 Riverside-San Bernardino-Ontario, CA ........................................................................................................... 1.1021 1.0688 

Riverside County, CA.

San Bernardino County, CA.

40220 ....... Roanoke, VA ..................................................................................................................................................... 0.8450 0.8911 

Botetourt County, VA.

Craig County, VA.

Franklin County, VA.

Roanoke County, VA.

Roanoke City, VA.

Salem City, VA.

40340 ....... Rochester, MN .................................................................................................................................................. 1.1128 1.0759 

Dodge County, MN.

Olmsted County, MN.

Wabasha County, MN.

40380 ....... 1 Rochester, NY ................................................................................................................................................. 0.9117 0.9387 

Livingston County, NY.

Monroe County, NY.

Ontario County, NY.

Orleans County, NY.

Wayne County, NY.

40420 ....... Rockford, IL ....................................................................................................................................................... 0.9975 0.9983 

Boone County, IL.

Winnebago County, IL.

40484 ....... 2 Rockingham County-Strafford County, NH ..................................................................................................... 1.0668 1.0453 

Rockingham County, NH.

Strafford County, NH.

40580 ....... Rocky Mount, NC .............................................................................................................................................. 0.8924 0.9250 

Edgecombe County, NC.

Nash County, NC.

40660 ....... Rome, GA ......................................................................................................................................................... 0.9414 0.9595 

Floyd County, GA.

40900 ....... 1Sacramento—Arden-Arcade—Roseville, CA .................................................................................................. 1.2953 1.1939 

El Dorado County, CA.

Placer County, CA.

Sacramento County, CA.

Yolo County, CA.

40980 ....... Saginaw-Saginaw Township North, MI ............................................................................................................. 0.9474 0.9637 

Saginaw County, MI.

41060 ....... St. Cloud, MN ................................................................................................................................................... 1.0030 1.0021 

Benton County, MN.

Stearns County, MN.

41100 ....... St. George, UT .................................................................................................................................................. 0.9416 0.9596 

Washington County, UT.

41140 ....... St. Joseph, MO-KS ........................................................................................................................................... 0.9565 0.9700 

Doniphan County, KS.

Andrew County, MO.

Buchanan County, MO.

DeKalb County, MO.

41180 ....... St. Louis, MO-IL ................................................................................................................................................ 0.8953 0.9271 

Bond County, IL.

Calhoun County, IL.

Clinton County, IL.

Jersey County, IL.

Macoupin County, IL.

Madison County, IL.

Monroe County, IL.

St. Clair County, IL.

Crawford County, MO.

Franklin County, MO.

23568 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

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Continued 

CBSA code Urban area (constituent counties) Wage 

index GAF 

Jefferson County, MO.

Lincoln County, MO.

St. Charles County, MO.

St. Louis County, MO.

Warren County, MO.

Washington County, MO.

St. Louis City, MO.

41420 ....... Salem, OR ........................................................................................................................................................ 1.0445 1.0303 

Marion County, OR.

Polk County, OR.

41500 ....... Salinas, CA ....................................................................................................................................................... 1.4140 1.2677 

Monterey County, CA.

41540 ....... 2Salisbury, MD .................................................................................................................................................. 0.9099 0.9374 

Somerset County, MD.

Wicomico County, MD.

41620 ....... Salt Lake City, UT ............................................................................................................................................. 0.9436 0.9610 

Salt Lake County, UT.

Summit County, UT.

Tooele County, UT.

41660 ....... San Angelo, TX ................................................................................................................................................. 0.8287 0.8793 

Irion County, TX.

Tom Green County, TX.

41700 ....... 1San Antonio, TX .............................................................................................................................................. 0.8987 0.9295 

Atascosa County, TX.

Bandera County, TX.

Bexar County, TX.

Comal County, TX.

Guadalupe County, TX.

Kendall County, TX.

Medina County, TX.

Wilson County, TX.

41740 ....... 1San Diego-Carlsbad-San Marcos, CA ............................................................................................................ 1.1417 1.0950 

San Diego County, CA.

41780 ....... Sandusky, OH ................................................................................................................................................... 0.9033 0.9327 

Erie County, OH.

41884 ....... 1San Francisco-San Mateo-Redwood City, CA ............................................................................................... 1.4970 1.3182 

Marin County, CA.

San Francisco County, CA.

San Mateo County, CA.

41900 ....... San Germa ́n-Cabo Rojo, PR ............................................................................................................................ 0.4646 0.5916 

Cabo Rojo Municipio, PR.

Lajas Municipio, PR.

Sabana Grande Municipio, PR.

San Germa ́n Municipio, PR.

41940 ....... 1San Jose-Sunnyvale-Santa Clara, CA ........................................................................................................... 1.5114 1.3269 

San Benito County, CA.

Santa Clara County, CA.

41980 ....... 1San Juan-Caguas-Guaynabo, PR .................................................................................................................. 0.4686 0.5951 

Aguas Buenas Municipio, PR.

Aibonito Municipio, PR.

Arecibo Municipio, PR.

Barceloneta Municipio, PR.

Barranquitas Municipio, PR.

Bayamo ́n Municipio, PR.

Caguas Municipio, PR.

Camuy Municipio, PR.

Cano ́vanas Municipio, PR.

Carolina Municipio, PR.

Catan ̃o Municipio, PR.

Cayey Municipio, PR.

Ciales Municipio, PR.

Cidra Municipio, PR.

Comer ́ıo Municipio, PR.

Corozal Municipio, PR.

Dorado Municipio, PR.

Florida Municipio, PR.

Guaynabo Municipio, PR.

Gurabo Municipio, PR.

Hatillo Municipio, PR.

Humacao Municipio, PR.

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23569 

TABLE 4A.—WAGE INDEX AND CAPITAL GEOGRAPHIC ADJUSTMENT FACTOR (GAF) FOR URBAN AREAS BY CBSA—

Continued 

CBSA code Urban area (constituent counties) Wage 

index GAF 

Juncos Municipio, PR.

Las Piedras Municipio, PR.

Lo ́ıza Municipio, PR.

Manat ́ı Municipio, PR.

Maunabo Municipio, PR.

Morovis Municipio, PR.

Naguabo Municipio, PR.

Naranjito Municipio, PR.

Orocovis Municipio, PR.

Quebradillas Municipio, PR.

R ́ıo Grande Municipio, PR.

San Juan Municipio, PR.

San Lorenzo Municipio, PR.

Toa Alta Municipio, PR.

Toa Baja Municipio, PR.

Trujillo Alto Municipio, PR.

Vega Alta Municipio, PR.

Vega Baja Municipio, PR.

Yabucoa Municipio, PR.

42020 ....... San Luis Obispo-Paso Robles, CA ................................................................................................................... 1.1357 1.0910 

San Luis Obispo County, CA.

42044 ....... 1Santa Ana-Anaheim-Irvine, CA ....................................................................................................................... 1.1564 1.1046 

Orange County, CA.

42060 ....... Santa Barbara-Santa Maria-Goleta, CA ........................................................................................................... 1.1525 1.1021 

Santa Barbara County, CA.

42100 ....... Santa Cruz-Watsonville, CA ............................................................................................................................. 1.5159 1.3296 

Santa Cruz County, CA.

42140 ....... Santa Fe, NM .................................................................................................................................................... 1.0908 1.0613 

Santa Fe County, NM.

42220 ....... Santa Rosa-Petaluma, CA ................................................................................................................................ 1.3480 1.2269 

Sonoma County, CA.

42260 ....... Sarasota-Bradenton-Venice, FL ........................................................................................................................ 0.9554 0.9692 

Manatee County, FL.

Sarasota County, FL.

42340 ....... Savannah, GA ................................................................................................................................................... 0.9483 0.9643 

Bryan County, GA.

Chatham County, GA.

Effingham County, GA.

42540 ....... Scranton—Wilkes-Barre, PA ............................................................................................................................. 0.8530 0.8968 

Lackawanna County, PA.

Luzerne County, PA.

Wyoming County, PA.

42644 ....... 1Seattle-Bellevue-Everett, WA ......................................................................................................................... 1.1573 1.1052 

King County, WA.

Snohomish County, WA.

43100 ....... 2Sheboygan, WI ............................................................................................................................................... 0.9478 0.9640 

Sheboygan County, WI.

43300 ....... Sherman-Denison, TX ....................................................................................................................................... 0.9518 0.9667 

Grayson County, TX.

43340 ....... Shreveport-Bossier City, LA .............................................................................................................................. 0.8767 0.9138 

Bossier Parish, LA.

Caddo Parish, LA.

De Soto Parish, LA.

43580 ....... Sioux City, IA-NE-SD ........................................................................................................................................ 0.9360 0.9557 

Woodbury County, IA.

Dakota County, NE.

Dixon County, NE.

Union County, SD.

43620 ....... Sioux Falls, SD ................................................................................................................................................. 0.9616 0.9735 

Lincoln County, SD.

McCook County, SD.

Minnehaha County, SD.

Turner County, SD.

43780 ....... South Bend-Mishawaka, IN-MI ......................................................................................................................... 0.9785 0.9852 

St. Joseph County, IN.

Cass County, MI.

43900 ....... Spartanburg, SC ............................................................................................................................................... 0.9183 0.9433 

Spartanburg County, SC.

44060 ....... Spokane, WA .................................................................................................................................................... 1.0898 1.0607 

Spokane County, WA.

23570 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

TABLE 4A.—WAGE INDEX AND CAPITAL GEOGRAPHIC ADJUSTMENT FACTOR (GAF) FOR URBAN AREAS BY CBSA—

Continued 

CBSA code Urban area (constituent counties) Wage 

index GAF 

44100 ....... Springfield, IL .................................................................................................................................................... 0.8879 0.9218 

Menard County, IL.

Sangamon County, IL.

44140 ....... Springfield, MA .................................................................................................................................................. 1.0259 1.0177 

Franklin County, MA.

Hampden County, MA.

Hampshire County, MA.

44180 ....... Springfield, MO ................................................................................................................................................. 0.8251 0.8766 

Christian County, MO.

Dallas County, MO.

Greene County, MO.

Polk County, MO.

Webster County, MO.

44220 ....... 2Springfield, OH ................................................................................................................................................ 0.8788 0.9153 

Clark County, OH.

44300 ....... State College, PA ............................................................................................................................................. 0.8368 0.8851 

Centre County, PA.

44700 ....... Stockton, CA ..................................................................................................................................................... 1.1333 1.0895 

San Joaquin County, CA.

44940 ....... 2Sumter, SC ..................................................................................................................................................... 0.8663 0.9064 

Sumter County, SC.

45060 ....... Syracuse, NY .................................................................................................................................................... 0.9595 0.9721 

Madison County, NY.

Onondaga County, NY.

Oswego County, NY.

45104 ....... Tacoma, WA ..................................................................................................................................................... 1.0794 1.0537 

Pierce County, WA.

45220 ....... Tallahassee, FL ................................................................................................................................................ 0.8712 0.9099 

Gadsden County, FL.

Jefferson County, FL.

Leon County, FL.

Wakulla County, FL.

45300 ....... 1Tampa-St. Petersburg-Clearwater, FL ............................................................................................................ 0.9292 0.9510 

Hernando County, FL.

Hillsborough County, FL.

Pasco County, FL.

Pinellas County, FL.

45460 ....... 2Terre Haute, IN ............................................................................................................................................... 0.8632 0.9042 

Clay County, IN.

Sullivan County, IN.

Vermillion County, IN.

Vigo County, IN.

45500 ....... Texarkana, TX-Texarkana, AR ......................................................................................................................... 0.8293 0.8797 

Miller County, AR.

Bowie County, TX.

45780 ....... Toledo, OH ........................................................................................................................................................ 0.9573 0.9706 

Fulton County, OH.

Lucas County, OH.

Ottawa County, OH.

Wood County, OH.

45820 ....... Topeka, KS ....................................................................................................................................................... 0.8921 0.9248 

Jackson County, KS.

Jefferson County, KS.

Osage County, KS.

Shawnee County, KS.

Wabaunsee County, KS.

45940 ....... Trenton-Ewing, NJ ............................................................................................................................................ 1.0837 1.0566 

Mercer County, NJ.

46060 ....... Tucson, AZ ........................................................................................................................................................ 0.9007 0.9309 

Pima County, AZ.

46140 ....... Tulsa, OK .......................................................................................................................................................... 0.8313 0.8812 

Creek County, OK.

Okmulgee County, OK.

Osage County, OK.

Pawnee County, OK.

Rogers County, OK.

Tulsa County, OK.

Wagoner County, OK.

46220 ....... Tuscaloosa, AL ................................................................................................................................................. 0.8724 0.9108 

Greene County, AL.

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23571 

TABLE 4A.—WAGE INDEX AND CAPITAL GEOGRAPHIC ADJUSTMENT FACTOR (GAF) FOR URBAN AREAS BY CBSA—

Continued 

CBSA code Urban area (constituent counties) Wage 

index GAF 

Hale County, AL.

Tuscaloosa County, AL.

46340 ....... Tyler, TX ........................................................................................................................................................... 0.9322 0.9531 

Smith County, TX.

46540 ....... Utica-Rome, NY ................................................................................................................................................ 0.8313 0.8812 

Herkimer County, NY.

Oneida County, NY.

46660 ....... Valdosta, GA ..................................................................................................................................................... 0.8873 0.9214 

Brooks County, GA.

Echols County, GA.

Lanier County, GA.

Lowndes County, GA.

46700 ....... Vallejo-Fairfield, CA .......................................................................................................................................... 1.4888 1.3133 

Solano County, CA.

46940 ....... Vero Beach, FL ................................................................................................................................................. 0.9458 0.9626 

Indian River County, FL.

47020 ....... Victoria, TX ....................................................................................................................................................... 0.8148 0.8691 

Calhoun County, TX.

Goliad County, TX.

Victoria County, TX.

47220 ....... 2Vineland-Millville-Bridgeton, NJ ...................................................................................................................... 1.0607 1.0412 

Cumberland County, NJ.

47260 ....... 1Virginia Beach-Norfolk-Newport News, VA-NC .............................................................................................. 0.8841 0.9191 

Currituck County, NC.

Gloucester County, VA.

Isle of Wight County, VA.

James City County, VA.

Mathews County, VA.

Surry County, VA.

York County, VA.

Chesapeake City, VA.

Hampton City, VA.

Newport News City, VA.

Norfolk City, VA.

Poquoson City, VA.

Portsmouth City, VA.

Suffolk City, VA.

Virginia Beach City, VA.

Williamsburg City, VA.

47300 ....... 2Visalia-Porterville, CA ..................................................................................................................................... 1.0848 1.0573 

Tulare County, CA.

47380 ....... Waco, TX .......................................................................................................................................................... 0.8532 0.8970 

McLennan County, TX.

47580 ....... Warner Robins, GA ........................................................................................................................................... 0.8662 0.9063 

Houston County, GA.

47644 ....... 1Warren-Farmington Hills-Troy, MI .................................................................................................................. 0.9858 0.9903 

Lapeer County, MI.

Livingston County, MI.

Macomb County, MI.

Oakland County, MI.

St. Clair County, MI.

47894 ....... 1Washington-Arlington-Alexandria, DC-VA-MD-WV ........................................................................................ 1.0935 1.0631 

District of Columbia, DC.

Calvert County, MD.

Charles County, MD.

Prince George’s County, MD.

Arlington County, VA.

Clarke County, VA.

Fairfax County, VA.

Fauquier County, VA.

Loudoun County, VA.

Prince William County, VA.

Spotsylvania County, VA.

Stafford County, VA.

Warren County, VA.

Alexandria City, VA.

Fairfax City, VA.

Falls Church City, VA.

Fredericksburg City, VA.

Manassas City, VA.

23572 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

TABLE 4A.—WAGE INDEX AND CAPITAL GEOGRAPHIC ADJUSTMENT FACTOR (GAF) FOR URBAN AREAS BY CBSA—

Continued 

CBSA code Urban area (constituent counties) Wage 

index GAF 

Manassas Park City, VA.

Jefferson County, WV.

47940 ....... Waterloo-Cedar Falls, IA ................................................................................................................................... 0.8564 0.8993 

Black Hawk County, IA.

Bremer County, IA.

Grundy County, IA.

48140 ....... Wausau, WI ...................................................................................................................................................... 0.9964 0.9975 

Marathon County, WI.

48260 ....... Weirton-Steubenville, WV-OH (WV Hospitals) ................................................................................................. 0.7821 0.8451 

Jefferson County, OH.

Brooke County, WV.

Hancock County, WV.

48260 ....... 2Weirton-Steubenville, WV-OH (OH Hospitals) ............................................................................................... 0.8788 0.9153 

Jefferson County, OH.

Brooke County, WV.

Hancock County, WV.

48300 ....... 2Wenatchee, WA .............................................................................................................................................. 1.0459 1.0312 

Chelan County, WA.

Douglas County, WA.

48424 ....... 1West Palm Beach-Boca Raton-Boynton Beach, FL ....................................................................................... 1.0061 1.0042 

Palm Beach County, FL.

48540 ....... 2Wheeling, WV-OH (WV Hospitals) ................................................................................................................. 0.7742 0.8392 

Belmont County, OH.

Marshall County, WV.

Ohio County, WV.

48540 ....... 2Wheeling, WV-OH (OH Hospitals) .................................................................................................................. 0.8788 0.9153 

Belmont County, OH.

Marshall County, WV.

Ohio County, WV.

48620 ....... Wichita, KS ....................................................................................................................................................... 0.9156 0.9414 

Butler County, KS.

Harvey County, KS.

Sedgwick County, KS.

Sumner County, KS.

48660 ....... Wichita Falls, TX ............................................................................................................................................... 0.8327 0.8822 

Archer County, TX.

Clay County, TX.

Wichita County, TX.

48700 ....... Williamsport, PA ................................................................................................................................................ 0.8368 0.8851 

Lycoming County, PA.

48864 ....... Wilmington, DE-MD-NJ ..................................................................................................................................... 1.0652 1.0442 

New Castle County, DE.

Cecil County, MD.

Salem County, NJ.

48900 ....... Wilmington, NC ................................................................................................................................................. 0.9580 0.9710 

Brunswick County, NC.

New Hanover County, NC.

Pender County, NC.

49020 ....... Winchester, VA-WV .......................................................................................................................................... 1.0214 1.0146 

Frederick County, VA.

Winchester City, VA.

Hampshire County, WV.

49180 ....... Winston-Salem, NC ........................................................................................................................................... 0.9020 0.9318 

Davie County, NC.

Forsyth County, NC.

Stokes County, NC.

Yadkin County, NC.

49340 ....... Worcester, MA .................................................................................................................................................. 1.1044 1.0704 

Worcester County, MA.

49420 ....... 2Yakima, WA .................................................................................................................................................... 1.0459 1.0312 

Yakima County, WA.

49500 ....... Yauco, PR ......................................................................................................................................................... 0.4413 0.5711 

Gua ́nica Municipio, PR.

Guayanilla Municipio, PR.

Pen ̃uelas Municipio, PR.

Yauco Municipio, PR.

49620 ....... York-Hanover, PA ............................................................................................................................................. 0.9422 0.9600 

York County, PA.

49660 ....... 2Youngstown-Warren-Boardman, OH-PA (OH Hospitals) ............................................................................... 0.8788 0.9153 

Mahoning County, OH.

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23573 

TABLE 4A.—WAGE INDEX AND CAPITAL GEOGRAPHIC ADJUSTMENT FACTOR (GAF) FOR URBAN AREAS BY CBSA—

Continued 

CBSA code Urban area (constituent counties) Wage 

index GAF 

Trumbull County, OH.

Mercer County, PA.

49660 ....... Youngstown-Warren-Boardman, OH-PA (PA Hospitals) .................................................................................. 0.8609 0.9025 

Mahoning County, OH.

Trumbull County, OH.

Mercer County, PA.

49700 ....... Yuba City, CA ................................................................................................................................................... 1.0951 1.0642 

Sutter County, CA.

Yuba County, CA.

49740 ....... Yuma, AZ .......................................................................................................................................................... 0.9188 0.9437 

Yuma County, AZ.

1 Large urban area. 

2 Hospitals geographically located in the area are assigned the statewide rural wage index for FY 2006. 

TABLE 4B.—WAGE INDEX AND CAPITAL GEOGRAPHIC ADJUSTMENT FACTOR (GAF) FOR RURAL AREAS BY CBSA 

CBSA 

code Nonurban area Wage index GAF 

01 ............. Alabama ............................................................................................................................................................ 0.7495 0.8208 

02 ............. Alaska ............................................................................................................................................................... 1.1977 1.1315 

03 ............. Arizona .............................................................................................................................................................. 0.8991 0.9298 

04 ............. Arkansas ........................................................................................................................................................... 0.7478 0.8195 

05 ............. California ........................................................................................................................................................... 1.0848 1.0573 

06 ............. Colorado ............................................................................................................................................................ 0.9379 0.9570 

07 ............. Connecticut ....................................................................................................................................................... 1.1790 1.1194 

08 ............. Delaware ........................................................................................................................................................... 0.9606 0.9728 

10 ............. Florida ............................................................................................................................................................... 0.8613 0.9028 

11 ............. Georgia ............................................................................................................................................................. 0.7684 0.8349 

12 ............. Hawaii ............................................................................................................................................................... 1.0598 1.0406 

13 ............. Idaho ................................................................................................................................................................. 0.8810 0.9169 

14 ............. Illinois ................................................................................................................................................................ 0.8285 0.8791 

15 ............. Indiana .............................................................................................................................................................. 0.8632 0.9042 

16 ............. Iowa ................................................................................................................................................................... 0.8563 0.8992 

17 ............. Kansas .............................................................................................................................................................. 0.8032 0.8606 

18 ............. Kentucky ........................................................................................................................................................... 0.7788 0.8427 

19 ............. Louisiana ........................................................................................................................................................... 0.7445 0.8171 

20 ............. Maine ................................................................................................................................................................ 0.8840 0.9190 

21 ............. Maryland ........................................................................................................................................................... 0.9099 0.9374 

22 ............. Massachusetts 1 ................................................................................................................................................ 1.0066 1.0045 

23 ............. Michigan ............................................................................................................................................................ 0.8923 0.9249 

24 ............. Minnesota .......................................................................................................................................................... 0.9183 0.9433 

25 ............. Mississippi ......................................................................................................................................................... 0.7685 0.8350 

26 ............. Missouri ............................................................................................................................................................. 0.7927 0.8529 

27 ............. Montana ............................................................................................................................................................ 0.8822 0.9177 

28 ............. Nebraska ........................................................................................................................................................... 0.8666 0.9066 

29 ............. Nevada .............................................................................................................................................................. 0.9079 0.9360 

30 ............. New Hampshire ................................................................................................................................................ 1.0668 1.0453 

31 ............. New Jersey 1 ..................................................................................................................................................... 1.0607 1.0412 

32 ............. New Mexico ...................................................................................................................................................... 0.8649 0.9054 

33 ............. New York .......................................................................................................................................................... 0.8220 0.8744 

34 ............. North Carolina ................................................................................................................................................... 0.8570 0.8997 

35 ............. North Dakota ..................................................................................................................................................... 0.7278 0.8045 

36 ............. Ohio ................................................................................................................................................................... 0.8788 0.9153 

37 ............. Oklahoma .......................................................................................................................................................... 0.7615 0.8298 

38 ............. Oregon .............................................................................................................................................................. 1.0284 1.0194 

39 ............. Pennsylvania ..................................................................................................................................................... 0.8300 0.8802 

40 ............. Puerto Rico 1 ..................................................................................................................................................... ................ ................

41 ............. Rhode Island 1 ................................................................................................................................................... 0.8807 0.9167 

42 ............. South Carolina .................................................................................................................................................. 0.8663 0.9064 

43 ............. South Dakota .................................................................................................................................................... 0.8475 0.8929 

44 ............. Tennessee ........................................................................................................................................................ 0.7915 0.8520 

45 ............. Texas ................................................................................................................................................................ 0.8038 0.8611 

46 ............. Utah ................................................................................................................................................................... 0.8134 0.8681 

47 ............. Vermont ............................................................................................................................................................. 1.0199 1.0136 

49 ............. Virginia .............................................................................................................................................................. 0.8024 0.8601 

50 ............. Washington ....................................................................................................................................................... 1.0459 1.0312 

51 ............. West Virginia ..................................................................................................................................................... 0.7742 0.8392 

52 ............. Wisconsin .......................................................................................................................................................... 0.9478 0.9640 

23574 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

TABLE 4B.—WAGE INDEX AND CAPITAL GEOGRAPHIC ADJUSTMENT FACTOR (GAF) FOR RURAL AREAS BY CBSA—

Continued 

CBSA 

code Nonurban area Wage index GAF 

53 ............. Wyoming ........................................................................................................................................................... 0.9207 0.9450 

1All counties within the State are classified as urban, with the exception of Massachusetts. Massachusetts has area(s) designated as rural, 

however, no short-term, acute care hospitals are located in the area(s) for FY 2006. 

Massachusetts, New Jersey, and Rhode Island rural floors are imputed as discussed in section III. H. of the preamble of this proposed rule. 

TABLE 4C.—WAGE INDEX AND CAPITAL GEOGRAPHIC ADJUSTMENT FACTOR (GAF) FOR HOSPITALS THAT ARE

RECLASSIFIED BY CBSA 

CBSA 

code Area Wage index GAF 

10180 ....... Abilene, TX ....................................................................................................................................................... 0.8038 0.8611 

10420 ....... Akron, OH ......................................................................................................................................................... 0.8979 0.9289 

10580 ....... Albany-Schenectady-Troy, NY .......................................................................................................................... 0.8565 0.8994 

10740 ....... Albuquerque, NM .............................................................................................................................................. 0.9558 0.9695 

10780 ....... Alexandria, LA ................................................................................................................................................... 0.8048 0.8618 

10900 ....... Allentown-Bethlehem-Easton, PA-NJ ............................................................................................................... 0.9844 0.9893 

11020 ....... Altoona, PA ....................................................................................................................................................... 0.8942 0.9263 

11100 ....... Amarillo, TX ...................................................................................................................................................... 0.9165 0.9420 

11180 ....... Ames, IA ........................................................................................................................................................... 0.9231 0.9467 

11460 ....... Ann Arbor, MI .................................................................................................................................................... 1.0628 1.0426 

11500 ....... Anniston-Oxford, AL .......................................................................................................................................... 0.7702 0.8363 

11700 ....... Asheville, NC .................................................................................................................................................... 0.9312 0.9524 

12020 ....... Athens-Clarke County, GA ................................................................................................................................ 0.9684 0.9783 

12060 ....... Atlanta-Sandy Springs-Marietta, GA ................................................................................................................. 0.9637 0.9750 

12420 ....... Austin-Round Rock, TX .................................................................................................................................... 0.9451 0.9621 

12620 ....... Bangor, ME ....................................................................................................................................................... 0.9985 0.9990 

12700 ....... Barnstable Town, MA ........................................................................................................................................ 1.2254 1.1494 

12940 ....... Baton Rouge, LA .............................................................................................................................................. 0.8470 0.8925 

13020 ....... Bay City, MI ...................................................................................................................................................... 0.9535 0.9679 

13780 ....... Binghamton, NY ................................................................................................................................................ 0.8471 0.8926 

13820 ....... Birmingham-Hoover, AL .................................................................................................................................... 0.8872 0.9213 

14260 ....... Boise City-Nampa, ID ....................................................................................................................................... 0.9048 0.9338 

14484 ....... Boston-Quincy, MA ........................................................................................................................................... 1.1233 1.0829 

14540 ....... Bowling Green, KY ........................................................................................................................................... 0.8222 0.8745 

15380 ....... Buffalo-Niagara Falls, NY ................................................................................................................................. 0.8888 0.9224 

15540 ....... Burlington-South Burlington, VT ....................................................................................................................... 0.9306 0.9519 

15764 ....... Cambridge-Newton-Framingham, MA .............................................................................................................. 1.0903 1.0610 

16180 ....... Carson City, NV ................................................................................................................................................ 0.9786 0.9853 

16220 ....... Casper, WY ....................................................................................................................................................... 0.9207 0.9450 

16580 ....... Champaign-Urbana, IL ...................................................................................................................................... 0.9335 0.9540 

16620 ....... Charleston, WV (WV Hospitals) ........................................................................................................................ 0.8274 0.8783 

16620 ....... Charleston, WV(OH Hospitals) ......................................................................................................................... 0.8788 0.9153 

16700 ....... Charleston-North Charleston, SC ..................................................................................................................... 0.9317 0.9527 

16740 ....... Charlotte-Gastonia-Concord, NC-SC ................................................................................................................ 0.9585 0.9714 

16820 ....... Charlottesville, VA ............................................................................................................................................. 0.9806 0.9867 

16860 ....... Chattanooga, TN-GA ........................................................................................................................................ 0.9099 0.9374 

16974 ....... Chicago-Naperville-Joliet, IL ............................................................................................................................. 1.0698 1.0473 

17140 ....... Cincinnati-Middletown, OH-KY-IN ..................................................................................................................... 0.9604 0.9727 

17300 ....... Clarksville, TN-KY ............................................................................................................................................. 0.8092 0.8650 

17460 ....... Cleveland-Elyria-Mentor, OH ............................................................................................................................ 0.9197 0.9443 

17780 ....... College Station-Bryan, TX ................................................................................................................................ 0.8911 0.9241 

17860 ....... Columbia, MO ................................................................................................................................................... 0.8346 0.8835 

17900 ....... Columbia, SC .................................................................................................................................................... 0.9057 0.9344 

17980 ....... Columbus, GA-AL ............................................................................................................................................. 0.8402 0.8876 

18140 ....... Columbus, OH .................................................................................................................................................. 0.9848 0.9896 

18700 ....... Corvallis, OR ..................................................................................................................................................... 1.0328 1.0223 

19124 ....... Dallas-Plano-Irving, TX ..................................................................................................................................... 0.9955 0.9969 

19380 ....... Dayton, OH ....................................................................................................................................................... 0.9069 0.9353 

19460 ....... Decatur, AL ....................................................................................................................................................... 0.8517 0.8959 

19740 ....... Denver-Aurora, CO ........................................................................................................................................... 1.0517 1.0351 

19780 ....... Des Moines, IA ................................................................................................................................................. 0.9413 0.9594 

19804 ....... Detroit-Livonia-Dearborn, MI ............................................................................................................................. 1.0453 1.0308 

20260 ....... Duluth, MN-WI .................................................................................................................................................. 1.0224 1.0153 

20500 ....... Durham, NC ...................................................................................................................................................... 0.9993 0.9995 

20764 ....... Edison, NJ ......................................................................................................................................................... 1.1301 1.0874 

20940 ....... El Centro, CA .................................................................................................................................................... 0.9102 0.9376 

21060 ....... Elizabethtown, KY ............................................................................................................................................. 0.8286 0.8792 

21500 ....... Erie, PA ............................................................................................................................................................. 0.8424 0.8892 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23575 

TABLE 4C.—WAGE INDEX AND CAPITAL GEOGRAPHIC ADJUSTMENT FACTOR (GAF) FOR HOSPITALS THAT ARE

RECLASSIFIED BY CBSA—Continued 

CBSA 

code Area Wage index GAF 

21604 ....... Essex County, MA ............................................................................................................................................ 1.0668 1.0453 

21660 ....... Eugene-Springfield, OR .................................................................................................................................... 1.0492 1.0334 

21780 ....... Evansville, IN-KY .............................................................................................................................................. 0.8508 0.8953 

22020 ....... Fargo, ND-MN (ND, SD Hospitals) ................................................................................................................... 0.8778 0.9146 

22020 ....... Fargo, ND-MN (MN Hospitals) .......................................................................................................................... 0.9183 0.9433 

22180 ....... Fayetteville, NC ................................................................................................................................................. 0.9193 0.9440 

22220 ....... Fayetteville-Springdale-Rogers, AR-MO ........................................................................................................... 0.8615 0.9029 

22380 ....... Flagstaff, AZ ...................................................................................................................................................... 1.1713 1.1144 

22420 ....... Flint, MI ............................................................................................................................................................. 1.0654 1.0443 

22540 ....... Fond du Lac, WI ............................................................................................................................................... 0.9478 0.9640 

22660 ....... Fort Collins-Loveland, CO ................................................................................................................................. 1.0146 1.0100 

22744 ....... Ft Lauderdale-Pompano Beach-Deerfield Beach, FL ....................................................................................... 1.0508 1.0345 

22900 ....... Fort Smith, AR-OK ............................................................................................................................................ 0.7986 0.8573 

23020 ....... Fort Walton Beach-Crestview-Destin, FL ......................................................................................................... 0.8672 0.9070 

23060 ....... Fort Wayne, IN .................................................................................................................................................. 0.9797 0.9861 

23104 ....... Fort Worth-Arlington, TX ................................................................................................................................... 0.9514 0.9665 

23540 ....... Gainesville, FL .................................................................................................................................................. 0.9461 0.9628 

23844 ....... Gary, IN ............................................................................................................................................................. 0.9366 0.9561 

24340 ....... Grand Rapids-Wyoming, MI .............................................................................................................................. 0.9398 0.9584 

24500 ....... Great Falls, MT ................................................................................................................................................. 0.9074 0.9356 

24540 ....... Greeley, CO ...................................................................................................................................................... 0.9597 0.9722 

24580 ....... Green Bay, WI (MI Hospitals) ........................................................................................................................... 0.9439 0.9612 

24580 ....... Green Bay, WI (WI Hospitals) .......................................................................................................................... 0.9478 0.9640 

24780 ....... Greenville, NC ................................................................................................................................................... 0.9414 0.9595 

24860 ....... Greenville, SC ................................................................................................................................................... 0.9807 0.9867 

25060 ....... Gulfport-Biloxi, MS ............................................................................................................................................ 0.8612 0.9027 

25420 ....... Harrisburg-Carlisle, PA ..................................................................................................................................... 0.9145 0.9406 

25500 ....... Harrisonburg, VA .............................................................................................................................................. 0.8998 0.9302 

25540 ....... Hartford-West Hartford-East Hartford, CT (MA Hospitals) ............................................................................... 1.1085 1.0731 

25540 ....... Hartford-West Hartford-East Hartford, CT (CT Hospitals) ................................................................................ 1.1790 1.1194 

25860 ....... Hickory-Lenoir-Morganton, NC ......................................................................................................................... 0.8931 0.9255 

26100 ....... Holland-Grand Haven, MI ................................................................................................................................. 0.9133 0.9398 

26180 ....... Honolulu, HI ...................................................................................................................................................... 1.1206 1.0811 

26420 ....... Houston-Baytown-Sugar Land, TX ................................................................................................................... 1.0008 1.0005 

26580 ....... Huntington-Ashland, WV-KY-OH ...................................................................................................................... 0.9119 0.9388 

26620 ....... Huntsville, AL .................................................................................................................................................... 0.9124 0.9391 

26900 ....... Indianapolis, IN ................................................................................................................................................. 0.9776 0.9846 

26980 ....... Iowa City, IA ...................................................................................................................................................... 0.9574 0.9706 

27060 ....... Ithaca, NY ......................................................................................................................................................... 0.9204 0.9448 

27140 ....... Jackson, MS ..................................................................................................................................................... 0.8182 0.8716 

27180 ....... Jackson, TN ...................................................................................................................................................... 0.8799 0.9161 

27260 ....... Jacksonville, FL ................................................................................................................................................ 0.9303 0.9517 

27860 ....... Jonesboro, AR .................................................................................................................................................. 0.7793 0.8430 

27900 ....... Joplin, MO ......................................................................................................................................................... 0.8458 0.8916 

28020 ....... Kalamazoo-Portage, MI .................................................................................................................................... 1.0403 1.0274 

28100 ....... Kankakee-Bradley, IL ........................................................................................................................................ 1.0991 1.0668 

28140 ....... Kansas City, MO-KS ......................................................................................................................................... 0.9454 0.9623 

28420 ....... Kennewick-Richland-Pasco, WA ....................................................................................................................... 1.0459 1.0312 

28700 ....... Kingsport-Bristol-Bristol, TN-VA ........................................................................................................................ 0.8095 0.8653 

28740 ....... Kingston, NY ..................................................................................................................................................... 0.8904 0.9236 

28940 ....... Knoxville, TN ..................................................................................................................................................... 0.8470 0.8925 

29180 ....... Lafayette, LA ..................................................................................................................................................... 0.8429 0.8896 

29404 ....... Lake County-Kenosha County, IL-WI ............................................................................................................... 1.0444 1.0302 

29460 ....... Lakeland, FL ..................................................................................................................................................... 0.8934 0.9257 

29620 ....... Lansing-East Lansing, MI ................................................................................................................................. 0.9786 0.9853 

29740 ....... Las Cruces, NM ................................................................................................................................................ 0.8649 0.9054 

29820 ....... Las Vegas-Paradise, NV ................................................................................................................................... 1.1249 1.0839 

30020 ....... Lawton, OK ....................................................................................................................................................... 0.7673 0.8341 

30460 ....... Lexington-Fayette, KY ...................................................................................................................................... 0.8830 0.9183 

30620 ....... Lima, OH ........................................................................................................................................................... 0.9263 0.9489 

30700 ....... Lincoln, NE ........................................................................................................................................................ 0.9666 0.9770 

30780 ....... Little Rock-North Little Rock, AR ...................................................................................................................... 0.8552 0.8984 

30980 ....... Longview, TX .................................................................................................................................................... 0.8621 0.9034 

31084 ....... Los Angeles-Long Beach-Santa Ana, CA ........................................................................................................ 1.1660 1.1109 

31140 ....... Louisville, KY-IN ................................................................................................................................................ 0.9264 0.9490 

31180 ....... Lubbock, TX ...................................................................................................................................................... 0.8790 0.9155 

31340 ....... Lynchburg, VA .................................................................................................................................................. 0.8596 0.9016 

31420 ....... Macon, GA ........................................................................................................................................................ 0.9087 0.9365 

31540 ....... Madison, WI ...................................................................................................................................................... 1.0416 1.0283 

31700 ....... Manchester-Nashua, NH ................................................................................................................................... 1.0668 1.0453 

23576 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

TABLE 4C.—WAGE INDEX AND CAPITAL GEOGRAPHIC ADJUSTMENT FACTOR (GAF) FOR HOSPITALS THAT ARE

RECLASSIFIED BY CBSA—Continued 

CBSA 

code Area Wage index GAF 

32780 ....... Medford, OR ..................................................................................................................................................... 1.0284 1.0194 

32820 ....... Memphis, TN-MS-AR ........................................................................................................................................ 0.9108 0.9380 

33124 ....... Miami-Miami Beach-Kendall, FL ....................................................................................................................... 0.9757 0.9833 

33260 ....... Midland, TX ....................................................................................................................................................... 0.9317 0.9527 

33340 ....... Milwaukee-Waukesha-West Allis, WI ............................................................................................................... 0.9957 0.9971 

33460 ....... Minneapolis-St. Paul-Bloomington, MN-WI ....................................................................................................... 1.0905 1.0611 

33540 ....... Missoula, MT ..................................................................................................................................................... 0.9535 0.9679 

33660 ....... Mobile, AL ......................................................................................................................................................... 0.7902 0.8511 

33700 ....... Modesto, CA ..................................................................................................................................................... 1.1885 1.1255 

33860 ....... Montgomery, AL ................................................................................................................................................ 0.8276 0.8785 

34060 ....... Morgantown, WV .............................................................................................................................................. 0.8332 0.8825 

34980 ....... Nashville-Davidson—Murfreesboro, TN ............................................................................................................ 0.9492 0.9649 

35084 ....... Newark-Union, NJ-PA ....................................................................................................................................... 1.2192 1.1454 

35380 ....... New Orleans-Metairie-Kenner, LA .................................................................................................................... 0.9003 0.9306 

35644 ....... New York-Wayne-White Plains, NY-NJ ............................................................................................................ 1.3191 1.2088 

36084 ....... Oakland-Fremont-Hayward, CA ........................................................................................................................ 1.5474 1.3485 

36100 ....... Ocala, FL .......................................................................................................................................................... 0.8955 0.9272 

36140 ....... Ocean City, NJ .................................................................................................................................................. 1.0289 1.0197 

36220 ....... Odessa, TX ....................................................................................................................................................... 0.9593 0.9719 

36260 ....... Ogden-Clearfield, UT ........................................................................................................................................ 0.9048 0.9338 

36420 ....... Oklahoma City, OK ........................................................................................................................................... 0.9043 0.9334 

36500 ....... Olympia, WA ..................................................................................................................................................... 1.0970 1.0655 

36540 ....... Omaha-Council Bluffs, NE-IA ........................................................................................................................... 0.9555 0.9693 

36740 ....... Orlando, FL ....................................................................................................................................................... 0.9446 0.9617 

37860 ....... Pensacola-Ferry Pass-Brent, FL ....................................................................................................................... 0.8089 0.8648 

37900 ....... Peoria, IL ........................................................................................................................................................... 0.8844 0.9193 

37964 ....... Philadelphia, PA ................................................................................................................................................ 1.1030 1.0694 

38220 ....... Pine Bluff, AR ................................................................................................................................................... 0.8099 0.8656 

38300 ....... Pittsburgh, PA ................................................................................................................................................... 0.8840 0.9190 

38340 ....... Pittsfield, MA ..................................................................................................................................................... 1.0199 1.0136 

38860 ....... Portland-South Portland-Biddeford, ME ............................................................................................................ 0.9884 0.9920 

38900 ....... Portland-Vancouver-Beaverton, OR-WA .......................................................................................................... 1.1229 1.0826 

38940 ....... Port St. Lucie-Fort Pierce, FL ........................................................................................................................... 1.0162 1.0111 

39100 ....... Poughkeepsie-Newburgh-Middletown, NY ....................................................................................................... 1.0576 1.0391 

39340 ....... Provo-Orem, UT ................................................................................................................................................ 0.9578 0.9709 

39580 ....... Raleigh-Cary, NC .............................................................................................................................................. 0.9476 0.9638 

39740 ....... Reading, PA ...................................................................................................................................................... 0.9500 0.9655 

39820 ....... Redding, CA ...................................................................................................................................................... 1.1909 1.1271 

39900 ....... Reno-Sparks, NV (NV Hospitals) ...................................................................................................................... 1.0805 1.0545 

39900 ....... Reno-Sparks, NV (CA Hospitals) ...................................................................................................................... 1.0848 1.0573 

40060 ....... Richmond, VA ................................................................................................................................................... 0.9319 0.9528 

40220 ....... Roanoke, VA ..................................................................................................................................................... 0.8450 0.8911 

40340 ....... Rochester, MN .................................................................................................................................................. 1.1128 1.0759 

40380 ....... Rochester, NY ................................................................................................................................................... 0.9117 0.9387 

40420 ....... Rockford, IL ....................................................................................................................................................... 0.9667 0.9771 

40484 ....... Rockingham County, NH .................................................................................................................................. 1.0503 1.0342 

40660 ....... Rome, GA ......................................................................................................................................................... 0.9414 0.9595 

40900 ....... Sacramento—Arden-Arcade—Roseville, CA .................................................................................................... 1.2953 1.1939 

40980 ....... Saginaw-Saginaw Township North, MI ............................................................................................................. 0.9090 0.9368 

41060 ....... St. Cloud, MN ................................................................................................................................................... 0.9785 0.9852 

41100 ....... St. George, UT .................................................................................................................................................. 0.9416 0.9596 

41180 ....... St. Louis, MO-IL ................................................................................................................................................ 0.8953 0.9271 

41620 ....... Salt Lake City, UT ............................................................................................................................................. 0.9436 0.9610 

41700 ....... San Antonio, TX ................................................................................................................................................ 0.8987 0.9295 

41884 ....... San Francisco-San Mateo-Redwood City,CA ................................................................................................... 1.4739 1.3043 

41980 ....... San Juan-Caguas-Guaynabo, PR .................................................................................................................... 0.4686 0.5951 

42044 ....... Santa Ana-Anaheim-Irvine, CA ......................................................................................................................... 1.1297 1.0871 

42140 ....... Santa Fe, NM .................................................................................................................................................... 1.0163 1.0111 

42220 ....... Santa Rosa-Petaluma, CA ................................................................................................................................ 1.3480 1.2269 

42260 ....... Sarasota-Bradenton-Venice, FL ........................................................................................................................ 0.9554 0.9692 

42340 ....... Savannah, GA ................................................................................................................................................... 0.9316 0.9526 

42644 ....... Seattle-Bellevue-Everett, WA ............................................................................................................................ 1.1573 1.1052 

43300 ....... Sherman-Denison, TX ....................................................................................................................................... 0.8971 0.9283 

43340 ....... Shreveport-Bossier City, LA .............................................................................................................................. 0.8767 0.9138 

43620 ....... Sioux Falls, SD ................................................................................................................................................. 0.9616 0.9735 

43780 ....... South Bend-Mishawaka, IN-MI ......................................................................................................................... 0.9785 0.9852 

43900 ....... Spartanburg, SC ............................................................................................................................................... 0.9183 0.9433 

44060 ....... Spokane, WA .................................................................................................................................................... 1.0722 1.0489 

44180 ....... Springfield, MO ................................................................................................................................................. 0.8251 0.8766 

44300 ....... State College, PA ............................................................................................................................................. 0.8300 0.8802 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23577 

TABLE 4C.—WAGE INDEX AND CAPITAL GEOGRAPHIC ADJUSTMENT FACTOR (GAF) FOR HOSPITALS THAT ARE

RECLASSIFIED BY CBSA—Continued 

CBSA 

code Area Wage index GAF 

44940 ....... Sumter, SC ....................................................................................................................................................... 0.8663 0.9064 

45060 ....... Syracuse, NY .................................................................................................................................................... 0.9315 0.9526 

45104 ....... Tacoma, WA ..................................................................................................................................................... 1.0794 1.0537 

45220 ....... Tallahassee, FL ................................................................................................................................................ 0.8420 0.8889 

45300 ....... Tampa-St. Petersburg-Clearwater, FL .............................................................................................................. 0.9292 0.9510 

45500 ....... Texarkana, TX-Texarkana, AR ......................................................................................................................... 0.8293 0.8797 

45820 ....... Topeka, KS ....................................................................................................................................................... 0.8785 0.9151 

46140 ....... Tulsa, OK .......................................................................................................................................................... 0.8313 0.8812 

46220 ....... Tuscaloosa, AL ................................................................................................................................................. 0.8614 0.9029 

46340 ....... Tyler, TX ........................................................................................................................................................... 0.9164 0.9420 

46660 ....... Valdosta, GA ..................................................................................................................................................... 0.8710 0.9098 

46700 ....... Vallejo-Fairfield, CA .......................................................................................................................................... 1.3955 1.2564 

47260 ....... Virginia Beach-Norfolk-Newport News, VA ....................................................................................................... 0.8841 0.9191 

47380 ....... Waco, TX .......................................................................................................................................................... 0.8532 0.8970 

47894 ....... Washington-Arlington-Alexandria DC-VA ......................................................................................................... 1.0813 1.0550 

48140 ....... Wausau, WI ...................................................................................................................................................... 0.9964 0.9975 

48620 ....... Wichita, KS ....................................................................................................................................................... 0.8946 0.9266 

48700 ....... Williamsport, PA ................................................................................................................................................ 0.8300 0.8802 

48864 ....... Wilmington, DE-MD-NJ ..................................................................................................................................... 1.0652 1.0442 

48900 ....... Wilmington, NC ................................................................................................................................................. 0.9394 0.9581 

49020 ....... Winchester, VA-WV .......................................................................................................................................... 1.0214 1.0146 

49180 ....... Winston-Salem, NC ........................................................................................................................................... 0.9020 0.9318 

49660 ....... Youngstown-Warren-Boardman, OH-PA (PA Hospitals) .................................................................................. 0.8446 0.8908 

49660 ....... Youngstown-Warren-Boardman, OH-PA (OH Hospitals) ................................................................................. 0.8788 0.9153 

03 ............. Rural Arizona .................................................................................................................................................... 0.8991 0.9298 

04 ............. Rural Arkansas ................................................................................................................................................. 0.7478 0.8195 

05 ............. Rural California ................................................................................................................................................. 1.0848 1.0573 

07 ............. Rural Connecticut ............................................................................................................................................. 1.0448 1.0305 

10 ............. Rural Florida ..................................................................................................................................................... 0.8613 0.9028 

13 ............. Rural Idaho ....................................................................................................................................................... 0.8810 0.9169 

14 ............. Rural Illinois ...................................................................................................................................................... 0.8285 0.8791 

15 ............. Rural Indiana ..................................................................................................................................................... 0.8632 0.9042 

16 ............. Rural Iowa ......................................................................................................................................................... 0.8563 0.8992 

17 ............. Rural Kansas .................................................................................................................................................... 0.8032 0.8606 

19 ............. Rural Louisiana ................................................................................................................................................. 0.7445 0.8171 

23 ............. Rural Michigan .................................................................................................................................................. 0.8923 0.9249 

24 ............. Rural Minnesota ................................................................................................................................................ 0.9183 0.9433 

26 ............. Rural Missouri ................................................................................................................................................... 0.7927 0.8529 

30 ............. Rural New Hampshire ....................................................................................................................................... 1.0668 1.0453 

37 ............. Rural Oklahoma ................................................................................................................................................ 0.7615 0.8298 

38 ............. Rural Oregon .................................................................................................................................................... 1.0284 1.0194 

45 ............. Rural Texas ....................................................................................................................................................... 0.8038 0.8611 

50 ............. Rural Washington (ID Hospitals) ...................................................................................................................... 1.0061 1.0042 

50 ............. Rural Washington (WA Hospitals) .................................................................................................................... 1.0459 1.0312 

53 ............. Rural Wyoming ................................................................................................................................................. 0.9207 0.9450 

TABLE 4F.—PUERTO RICO WAGE INDEX AND CAPITAL GEOGRAPHIC ADJUSTMENT FACTOR (GAF) BY CBSA 

CBSA Code Area Wage Index GAF 

Wage Index 

-Reclassified Hospitals 

GAF -Reclassified 

Hospitals 

10380 .......... Aguadilla-Isabela-San Sebastia ́n, PR .................................................... 1.0196 1.0134 .................... ....................

21940 .......... Fajardo, PR ............................................................................................ 0.8956 0.9273 .................... ....................

25020 .......... Guayama, PR ......................................................................................... 0.6858 0.7724 .................... ....................

32420 .......... Mayagu ̈ez, PR ........................................................................................ 0.8647 0.9052 .................... ....................

38660 .......... Ponce, PR .............................................................................................. 1.1147 1.0772 .................... ....................

41900 .......... San Germa ́n-Cabo Rojo, PR ................................................................. 1.0002 1.0001 .................... ....................

41980 .......... San Juan-Caguas-Guaynabo, PR ......................................................... 1.0087 1.0059 1.0087 1.0059

49500 .......... Yauco, PR .............................................................................................. 0.9500 0.9655 .................... ....................

The following list represents all 

hospitals that are eligible to have their 

wage index increased by the outmigration adjustment listed in this table. 

Hospitals cannot receive the outmigration adjustment if they are 

reclassified under section 1886(d)(10) of 

the Act or redesignated under section 

1886(d)(8)(B) of the Act. Hospitals that 

have already been reclassified under 

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

redesignated under section 

23578 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

1886(d)(8)(B) of the Act are designated 

with an asterisk. Hospitals have the 

opportunity to use the new additional 

30-day period to review their individual 

situation to determine whether to 

submit a request to withdraw their 

reclassification/redesignation and 

receive the out-migration adjustment 

instead. We will automatically assume 

that hospitals that have already been 

reclassified under section 1886(d)(10) of 

the Act or redesignated under section 

1886(d)(8)(B) of the Act wish to retain 

their reclassification/redesignation 

status and waive the application of the 

out-migration adjustment. Hospitals are 

not required to provide CMS with any 

type of formal notification that they 

wish to remain reclassified/ 

redesignated. 

TABLE 4J.—OUT-MIGRATION

ADJUSTMENT—FY 2006 

Provider 

number 

Out-migration 

adjustment 

Qualifying county 

name 

010005* ... 0.0259 MARSHALL 

010008* ... 0.0212 CRENSHAW 

010009 ..... 0.0092 MORGAN 

010010 ..... 0.0259 MARSHALL 

010012* ... 0.0205 DE KALB 

010022* ... 0.0714 CHEROKEE 

010025* ... 0.0225 CHAMBERS 

010029* ... 0.0107 LEE 

010035* ... 0.0375 CULLMAN 

010038 ..... 0.0062 CALHOUN 

010045* ... 0.0160 FAYETTE 

010047 ..... 0.0155 BUTLER 

010054 ..... 0.0092 MORGAN 

010061 ..... 0.0506 JACKSON 

010072* ... 0.0310 TALLADEGA 

010078 ..... 0.0062 CALHOUN 

010083* ... 0.0121 BALDWIN 

010085 ..... 0.0092 MORGAN 

010100* ... 0.0121 BALDWIN 

010101* ... 0.0310 TALLADEGA 

010109 ..... 0.0464 PICKENS 

010115 ..... 0.0093 FRANKLIN 

010129 ..... 0.0121 BALDWIN 

010143* ... 0.0375 CULLMAN 

010146 ..... 0.0062 CALHOUN 

010150 ..... 0.0155 BUTLER 

010158* ... 0.0093 FRANKLIN 

040014* ... 0.0159 WHITE 

040019* ... 0.0697 ST. FRANCIS 

040047* ... 0.0090 RANDOLPH 

040066 ..... 0.0382 CLARK 

040069* ... 0.0140 MISSISSIPPI 

040070 ..... 0.0140 MISSISSIPPI 

040071* ... 0.0026 JEFFERSON 

040076* ... 0.1075 HOT SPRING 

040100* ... 0.0159 WHITE 

040143 ..... 0.0026 JEFFERSON 

050008 ..... 0.0028 SAN FRANCISCO 

050009* ... 0.0478 NAPA 

050013* ... 0.0478 NAPA 

050014* ... 0.0131 AMADOR 

050016 ..... 0.0087 SAN LUIS 

OBISPO 

050042* ... 0.0219 TEHAMA 

050046* ... 0.0156 VENTURA 

TABLE 4J.—OUT-MIGRATION

ADJUSTMENT—FY 2006—Continued 

Provider 

number 

Out-migration 

adjustment 

Qualifying county 

name 

050047 ..... 0.0028 SAN FRANCISCO 

050055 ..... 0.0028 SAN FRANCISCO 

050065* ... 0.0029 ORANGE 

050069* ... 0.0029 ORANGE 

050073* ... 0.0269 SOLANO 

050076* ... 0.0028 SAN FRANCISCO 

050082* ... 0.0156 VENTURA 

050084 ..... 0.0555 SAN JOAQUIN 

050088 ..... 0.0087 SAN LUIS 

OBISPO 

050089* ... 0.0152 SAN 

BERNARDINO 

050090* ... 0.0308 SONOMA 

050099* ... 0.0152 SAN 

BERNARDINO 

050101 ..... 0.0269 SOLANO 

050117 ..... 0.0463 MERCED 

050118* ... 0.0555 SAN JOAQUIN 

050122 ..... 0.0555 SAN JOAQUIN 

050129* ... 0.0152 SAN 

BERNARDINO 

050133 ..... 0.017 YUBA 

050136* ... 0.0308 SONOMA 

050140* ... 0.0152 SAN 

BERNARDINO 

050150* ... 0.0316 NEVADA 

050152 ..... 0.0028 SAN FRANCISCO 

050159* ... 0.0156 VENTURA 

050167 ..... 0.0555 SAN JOAQUIN 

050168* ... 0.0029 ORANGE 

050173* ... 0.0029 ORANGE 

050174* ... 0.0308 SONOMA 

050177* ... 0.0156 VENTURA 

050193* ... 0.0029 ORANGE 

050224* ... 0.0029 ORANGE 

050226* ... 0.0029 ORANGE 

050228* ... 0.0028 SAN FRANCISCO 

050230* ... 0.0029 ORANGE 

050232 ..... 0.0087 SAN LUIS 

OBISPO 

050236* ... 0.0156 VENTURA 

050245* ... 0.0152 SAN 

BERNARDINO 

050253 ..... 0.0029 ORANGE 

050272* ... 0.0152 SAN 

BERNARDINO 

050279* ... 0.0152 SAN 

BERNARDINO 

050291* ... 0.0308 SONOMA 

050298* ... 0.0152 SAN 

BERNARDINO 

050300* ... 0.0152 SAN 

BERNARDINO 

050313 ..... 0.0555 SAN JOAQUIN 

050325 ..... 0.0176 TUOLUMNE 

050327* ... 0.0152 SAN 

BERNARDINO 

050331* ... 0.0308 SONOMA 

050335 ..... 0.0176 TUOLUMNE 

050336 ..... 0.0555 SAN JOAQUIN 

050348* ... 0.0029 ORANGE 

050366 ..... 0.0096 CALAVERAS 

050367 ..... 0.0269 SOLANO 

050385* ... 0.0308 SONOMA 

TABLE 4J.—OUT-MIGRATION

ADJUSTMENT—FY 2006—Continued 

Provider 

number 

Out-migration 

adjustment 

Qualifying county 

name 

050394* ... 0.0156 VENTURA 

050407 ..... 0.0028 SAN FRANCISCO 

050426* ... 0.0029 ORANGE 

050444 ..... 0.0463 MERCED 

050454 ..... 0.0028 SAN FRANCISCO 

050457 ..... 0.0028 SAN FRANCISCO 

050469* ... 0.0152 SAN 

BERNARDINO 

050476 ..... 0.0257 LAKE 

050491 ..... 0.0029 ORANGE 

050494 ..... 0.0316 NEVADA 

050506 ..... 0.0087 SAN LUIS 

OBISPO 

050517* ... 0.0152 SAN 

BERNARDINO 

050526* ... 0.0029 ORANGE 

050528* ... 0.0463 MERCED 

050535* ... 0.0029 ORANGE 

050539 ..... 0.0257 LAKE 

050543* ... 0.0029 ORANGE 

050547* ... 0.0308 SONOMA 

050548* ... 0.0029 ORANGE 

050549 ..... 0.0156 VENTURA 

050550* ... 0.0029 ORANGE 

050551* ... 0.0029 ORANGE 

050567* ... 0.0029 ORANGE 

050568 ..... 0.0062 MADERA 

050570* ... 0.0029 ORANGE 

050580* ... 0.0029 ORANGE 

050584* ... 0.0152 SAN 

BERNARDINO 

050585* ... 0.0029 ORANGE 

050586* ... 0.0152 SAN 

BERNARDINO 

050589* ... 0.0029 ORANGE 

050592* ... 0.0029 ORANGE 

050594* ... 0.0029 ORANGE 

050603* ... 0.0029 ORANGE 

050609* ... 0.0029 ORANGE 

050616* ... 0.0156 VENTURA 

050618* ... 0.0152 SAN 

BERNARDINO 

050633 ..... 0.0087 SAN LUIS 

OBISPO 

050667* ... 0.0478 NAPA 

050668* ... 0.0028 SAN FRANCISCO 

050678* ... 0.0029 ORANGE 

050680 ..... 0.0269 SOLANO 

050690* ... 0.0308 SONOMA 

050693 ..... 0.0029 ORANGE 

050695 ..... 0.0555 SAN JOAQUIN 

050720* ... 0.0029 ORANGE 

050728* ... 0.0308 SONOMA 

060001* ... 0.0294 WELD 

060003* ... 0.0203 BOULDER 

060027* ... 0.0203 BOULDER 

060103* ... 0.0203 BOULDER 

070003* ... 0.0009 WINDHAM 

070006 ..... 0.0047 FAIRFIELD 

070010 ..... 0.0047 FAIRFIELD 

070018 ..... 0.0047 FAIRFIELD 

070020 ..... 0.0073 MIDDLESEX 

070021* ... 0.0009 WINDHAM 

070028 ..... 0.0047 FAIRFIELD 

070033* ... 0.0047 FAIRFIELD 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23579 

TABLE 4J.—OUT-MIGRATION

ADJUSTMENT—FY 2006—Continued 

Provider 

number 

Out-migration 

adjustment 

Qualifying county 

name 

070034 ..... 0.0047 FAIRFIELD 

080001 ..... 0.0059 NEW CASTLE 

080003 ..... 0.0059 NEW CASTLE 

100014 ..... 0.0118 VOLUSIA 

100017 ..... 0.0118 VOLUSIA 

100023* ... 0.0069 CITRUS 

100045* ... 0.0118 VOLUSIA 

100047 ..... 0.0021 CHARLOTTE 

100062 ..... 0.0060 MARION 

100068 ..... 0.0118 VOLUSIA 

100072 ..... 0.0118 VOLUSIA 

100077 ..... 0.0021 CHARLOTTE 

100102 ..... 0.0133 COLUMBIA 

100118* ... 0.0398 FLAGLER 

100156 ..... 0.0133 COLUMBIA 

100175 ..... 0.0231 DE SOTO 

100212 ..... 0.0060 MARION 

100232* ... 0.0347 PUTNAM 

100236 ..... 0.0021 CHARLOTTE 

100249* ... 0.0069 CITRUS 

100252* ... 0.0233 OKEECHOBEE 

110023* ... 0.0500 GORDON 

110026 ..... 0.0220 ELBERT 

110027 ..... 0.0387 FRANKLIN 

110029* ... 0.0063 HALL 

110041* ... 0.0777 HABERSHAM 

110063 ..... 0.0290 LIBERTY 

110069* ... 0.0474 HOUSTON 

110120 ..... 0.0873 POLK 

110124 ..... 0.0428 WAYNE 

110136 ..... 0.0261 BALDWIN 

110146 ..... 0.0642 CAMDEN 

110150* ... 0.0261 BALDWIN 

110153* ... 0.0474 HOUSTON 

110187* ... 0.1172 LUMPKIN 

110189* ... 0.0031 FANNIN 

110190 ..... 0.0182 MACON 

110205* ... 0.0779 GILMER 

130003* ... 0.0095 NEZ PERCE 

130011 ..... 0.0218 LATAH 

130024 ..... 0.0275 BONNER 

130049* ... 0.0349 KOOTENAI 

140001 ..... 0.0199 FULTON 

140012* ... 0.022 LEE 

140026 ..... 0.0346 LA SALLE 

140033 ..... 0.0147 LAKE 

140043* ... 0.0046 WHITESIDE 

140058* ... 0.0081 MORGAN 

140084 ..... 0.0147 LAKE 

140100 ..... 0.0147 LAKE 

140110* ... 0.0346 LA SALLE 

140129 ..... 0.0096 WABASH 

140130 ..... 0.0147 LAKE 

140155 ..... 0.0027 KANKAKEE 

140160* ... 0.0286 STEPHENSON 

140161* ... 0.0138 LIVINGSTON 

140167* ... 0.0937 IROQUOIS 

140173 ..... 0.0046 WHITESIDE 

140186 ..... 0.0027 KANKAKEE 

140199 ..... 0.0109 MONTGOMERY 

140202 ..... 0.0147 LAKE 

140205 ..... 0.0163 BOONE 

140234* ... 0.0346 LA SALLE 

140291* ... 0.0147 LAKE 

150002* ... 0.0241 LAKE 

150004* ... 0.0241 LAKE 

150008* ... 0.0241 LAKE 

150022 ..... 0.0249 MONTGOMERY 

150030* ... 0.0201 HENRY 

TABLE 4J.—OUT-MIGRATION

ADJUSTMENT—FY 2006—Continued 

Provider 

number 

Out-migration 

adjustment 

Qualifying county 

name 

150034 ..... 0.0241 LAKE 

150035 ..... 0.0083 PORTER 

150045 ..... 0.0416 DE KALB 

150060 ..... 0.0052 VERMILLION 

150062 ..... 0.0153 DECATUR 

150065* ... 0.0139 JACKSON 

150076* ... 0.0189 MARSHALL 

150088* ... 0.0196 MADISON 

150090* ... 0.0241 LAKE 

150091 ..... 0.0573 HUNTINGTON 

150102* ... 0.0160 STARKE 

150113* ... 0.0196 MADISON 

150122 ..... 0.0199 RIPLEY 

150125* ... 0.0241 LAKE 

150126* ... 0.0241 LAKE 

150132* ... 0.0241 LAKE 

150147* ... 0.0241 LAKE 

150156 ..... 0.0241 LAKE 

160013 ..... 0.0218 MUSCATINE 

160026* ... 0.0496 BOONE 

160030 ..... 0.0032 STORY 

160032 ..... 0.0272 JASPER 

160080* ... 0.0049 CLINTON 

160140 ..... 0.0364 PLYMOUTH 

170137* ... 0.0331 DOUGLAS 

180012* ... 0.0083 HARDIN 

180049 ..... 0.0532 MADISON 

180055 ..... 0.0532 MADISON 

180066* ... 0.0567 LOGAN 

180127* ... 0.0352 FRANKLIN 

180128 ..... 0.0282 LAWRENCE 

190001* ... 0.0645 WASHINGTON 

190003* ... 0.0107 IBERIA 

190010 ..... 0.0401 TANGIPAHOA 

190015* ... 0.0401 TANGIPAHOA 

190017 ..... 0.0235 ST. LANDRY 

190049 ..... 0.0645 WASHINGTON 

190054 ..... 0.0107 IBERIA 

190078 ..... 0.0235 ST. LANDRY 

190086* ... 0.0129 LINCOLN 

190088 ..... 0.0705 WEBSTER 

190099* ... 0.039 AVOYELLES 

190106* ... 0.0238 ALLEN 

190116 ..... 0.0179 MOREHOUSE 

190133 ..... 0.0238 ALLEN 

190144 ..... 0.0705 WEBSTER 

190147 ..... 0.0401 TANGIPAHOA 

190148 ..... 0.039 AVOYELLES 

190191* ... 0.0235 ST. LANDRY 

200002* ... 0.0129 LINCOLN 

200013 ..... 0.0186 WALDO 

200019 ..... 0.0067 YORK 

200020* ... 0.0067 YORK 

200024* ... 0.0071 ANDROSCOGGIN 

200032 ..... 0.046 OXFORD 

200034* ... 0.0071 ANDROSCOGGIN 

200040 ..... 0.0067 YORK 

200050* ... 0.0140 HANCOCK 

210001 ..... 0.0129 WASHINGTON 

210004 ..... 0.0040 MONTGOMERY 

210016 ..... 0.0040 MONTGOMERY 

210018 ..... 0.0040 MONTGOMERY 

210022 ..... 0.0040 MONTGOMERY 

210023 ..... 0.0209 ANNE ARUNDEL 

210028 ..... 0.0512 ST. MARYS 

210043 ..... 0.0209 ANNE ARUNDEL 

210048 ..... 0.0287 HOWARD 

TABLE 4J.—OUT-MIGRATION

ADJUSTMENT—FY 2006—Continued 

Provider 

number 

Out-migration 

adjustment 

Qualifying county 

name 

210057 ..... 0.0040 MONTGOMERY 

220001* ... 0.0056 WORCESTER 

220002* ... 0.0249 MIDDLESEX 

220003* ... 0.0056 WORCESTER 

220006 ..... 0.0306 ESSEX 

220010* ... 0.0306 ESSEX 

220011* ... 0.0249 MIDDLESEX 

220019* ... 0.0056 WORCESTER 

220025* ... 0.0056 WORCESTER 

220028* ... 0.0056 WORCESTER 

220029* ... 0.0306 ESSEX 

220033* ... 0.0306 ESSEX 

220035* ... 0.0306 ESSEX 

220049* ... 0.0249 MIDDLESEX 

220058* ... 0.0056 WORCESTER 

220062* ... 0.0056 WORCESTER 

220063* ... 0.0249 MIDDLESEX 

220070* ... 0.0249 MIDDLESEX 

220076 ..... 0.0249 MIDDLESEX 

220080* ... 0.0306 ESSEX 

220082* ... 0.0249 MIDDLESEX 

220084* ... 0.0249 MIDDLESEX 

220089* ... 0.0249 MIDDLESEX 

220090* ... 0.0056 WORCESTER 

220095* ... 0.0056 WORCESTER 

220098* ... 0.0249 MIDDLESEX 

220101* ... 0.0249 MIDDLESEX 

220105* ... 0.0249 MIDDLESEX 

220163* ... 0.0056 WORCESTER 

220171* ... 0.0249 MIDDLESEX 

220174* ... 0.0306 ESSEX 

230003 ..... 0.0035 OTTAWA 

230005 ..... 0.0598 LENAWEE 

230013 ..... 0.0091 OAKLAND 

230015 ..... 0.0359 ST. JOSEPH 

230019 ..... 0.0091 OAKLAND 

230021 ..... 0.0136 BERRIEN 

230022* ... 0.0113 BRANCH 

230029 ..... 0.0091 OAKLAND 

230037* ... 0.0178 HILLSDALE 

230041 ..... 0.0099 BAY 

230042* ... 0.0685 ALLEGAN 

230047* ... 0.0082 MACOMB 

230069* ... 0.0487 LIVINGSTON 

230071 ..... 0.0091 OAKLAND 

230072 ..... 0.0035 OTTAWA 

230075 ..... 0.0145 CALHOUN 

230078* ... 0.0136 BERRIEN 

230092 ..... 0.0389 JACKSON 

230093* ... 0.0079 MECOSTA 

230096* ... 0.0359 ST. JOSEPH 

230099* ... 0.0339 MONROE 

230106 ..... 0.0030 NEWAYGO 

230120 ..... 0.0598 LENAWEE 

230121* ... 0.0691 SHIAWASSEE 

230130 ..... 0.0091 OAKLAND 

230151 ..... 0.0091 OAKLAND 

230174 ..... 0.0035 OTTAWA 

230184 ..... 0.0389 JACKSON 

230195* ... 0.0082 MACOMB 

230204* ... 0.0082 MACOMB 

230207 ..... 0.0091 OAKLAND 

230217* ... 0.0145 CALHOUN 

230222 ..... 0.0228 MIDLAND 

230223 ..... 0.0091 OAKLAND 

230227* ... 0.0082 MACOMB 

230254 ..... 0.0091 OAKLAND 

230257* ... 0.0082 MACOMB 

230264* ... 0.0082 MACOMB 

23580 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

TABLE 4J.—OUT-MIGRATION

ADJUSTMENT—FY 2006—Continued 

Provider 

number 

Out-migration 

adjustment 

Qualifying county 

name 

230269 ..... 0.0091 OAKLAND 

230277 ..... 0.0091 OAKLAND 

230279* ... 0.0487 LIVINGSTON 

230295* ... 0.0685 ALLEGAN 

240011 ..... 0.0506 MC LEOD 

240013* ... 0.0226 MORRISON 

240014 ..... 0.0454 RICE 

240018* ... 0.1196 GOODHUE 

240021 ..... 0.0897 LE SUEUR 

240044 ..... 0.0868 WINONA 

240064* ... 0.0138 ITASCA 

240069* ... 0.0419 STEELE 

240071* ... 0.0454 RICE 

240089 ..... 0.1196 GOODHUE 

240133 ..... 0.0319 MEEKER 

240152* ... 0.0735 KANABEC 

240154 ..... 0.0138 ITASCA 

240187* ... 0.0506 MC LEOD 

240205 ..... 0.0138 ITASCA 

240211* ... 0.0705 PINE 

250030 ..... 0.0318 LEAKE 

250040* ... 0.0294 JACKSON 

250045 ..... 0.0042 HANCOCK 

250088 ..... 0.0122 WILKINSON 

250154 ..... 0.0318 LEAKE 

260011* ... 0.0007 COLE 

260025* ... 0.0078 MARION 

260047* ... 0.0007 COLE 

260073 ..... 0.0197 BARTON 

260074* ... 0.0158 RANDOLPH 

260097 ..... 0.0425 JOHNSON 

260127 ..... 0.0158 PIKE 

280054 ..... 0.0137 GAGE 

280077* ... 0.0089 DODGE 

280123 ..... 0.0137 GAGE 

290019* ... 0.0026 CARSON CITY 

290020 ..... 0.1013 NYE 

300007* ... 0.0080 HILLSBOROUGH 

300011* ... 0.0080 HILLSBOROUGH 

300012* ... 0.0080 HILLSBOROUGH 

300017* ... 0.0361 ROCKINGHAM 

300020* ... 0.0080 HILLSBOROUGH 

300023* ... 0.0361 ROCKINGHAM 

300029* ... 0.0361 ROCKINGHAM 

300034* ... 0.0080 HILLSBOROUGH 

310002* ... 0.0351 ESSEX 

310009* ... 0.0351 ESSEX 

310010 ..... 0.0180 MERCER 

310011 ..... 0.0181 CAPE MAY 

310013* ... 0.0351 ESSEX 

310014 ..... 0.0156 CAMDEN 

310018* ... 0.0351 ESSEX 

310021 ..... 0.0180 MERCER 

310022 ..... 0.0156 CAMDEN 

310029 ..... 0.0156 CAMDEN 

310031* ... 0.0137 BURLINGTON 

310032* ... 0.0065 CUMBERLAND 

310038* ... 0.0350 MIDDLESEX 

310039 ..... 0.0350 MIDDLESEX 

310044 ..... 0.0180 MERCER 

310054* ... 0.0351 ESSEX 

310057 ..... 0.0137 BURLINGTON 

310061 ..... 0.0137 BURLINGTON 

310070* ... 0.0350 MIDDLESEX 

310076* ... 0.0351 ESSEX 

310078* ... 0.0351 ESSEX 

310083* ... 0.0351 ESSEX 

310086 ..... 0.0156 CAMDEN 

310092 ..... 0.0180 MERCER 

TABLE 4J.—OUT-MIGRATION

ADJUSTMENT—FY 2006—Continued 

Provider 

number 

Out-migration 

adjustment 

Qualifying county 

name 

310093* ... 0.0351 ESSEX 

310096* ... 0.0351 ESSEX 

310108 ..... 0.0350 MIDDLESEX 

310110 ..... 0.0180 MERCER 

310119* ... 0.0351 ESSEX 

320003 ..... 0.0630 SAN MIGUEL 

320011 ..... 0.0442 RIO ARRIBA 

320018 ..... 0.0063 DONA ANA 

320085 ..... 0.0063 DONA ANA 

330001* ... 0.0560 ORANGE 

330004* ... 0.0959 ULSTER 

330008* ... 0.0470 WYOMING 

330027* ... 0.0137 NASSAU 

330094* ... 0.0778 COLUMBIA 

330106 ..... 0.0137 NASSAU 

330126 ..... 0.0560 ORANGE 

330135 ..... 0.0560 ORANGE 

330167 ..... 0.0137 NASSAU 

330175 ..... 0.0268 CORTLAND 

330181* ... 0.0137 NASSAU 

330182* ... 0.0137 NASSAU 

330191* ... 0.0026 WARREN 

330198 ..... 0.0137 NASSAU 

330205 ..... 0.0560 ORANGE 

330209 ..... 0.0560 ORANGE 

330222 ..... 0.0003 SARATOGA 

330224 ..... 0.0959 ULSTER 

330225 ..... 0.0137 NASSAU 

330235* ... 0.0270 CAYUGA 

330259 ..... 0.0137 NASSAU 

330264 ..... 0.0560 ORANGE 

330276 ..... 0.0063 FULTON 

330331 ..... 0.0137 NASSAU 

330332 ..... 0.0137 NASSAU 

330333 ..... 0.0137 NASSAU 

330372 ..... 0.0137 NASSAU 

330386* ... 0.1139 SULLIVAN 

330402 ..... 0.0959 ULSTER 

340003 ..... 0.0116 SURRY 

340015 ..... 0.0267 ROWAN 

340016 ..... 0.1312 JACKSON 

340020 ..... 0.0207 LEE 

340021* ... 0.0216 CLEVELAND 

340027* ... 0.0126 LENOIR 

340037 ..... 0.0216 CLEVELAND 

340039* ... 0.0144 IREDELL 

340069* ... 0.0053 WAKE 

340070 ..... 0.0448 ALAMANCE 

340073* ... 0.0053 WAKE 

340085 ..... 0.0377 DAVIDSON 

340088 ..... 0.0115 TRANSYLVANIA 

340096 ..... 0.0377 DAVIDSON 

340097 ..... 0.0116 SURRY 

340104 ..... 0.0216 CLEVELAND 

340114* ... 0.0053 WAKE 

340126 ..... 0.0161 WILSON 

340127* ... 0.0961 GRANVILLE 

340129* ... 0.0144 IREDELL 

340133 ..... 0.0302 MARTIN 

340138* ... 0.0053 WAKE 

340144* ... 0.0144 IREDELL 

340145* ... 0.0563 LINCOLN 

340173* ... 0.0053 WAKE 

360013* ... 0.0166 SHELBY 

360025* ... 0.0087 ERIE 

360034 ..... 0.0263 WAYNE 

360036* ... 0.0263 WAYNE 

360040 ..... 0.0327 KNOX 

360065* ... 0.0141 HURON 

TABLE 4J.—OUT-MIGRATION

ADJUSTMENT—FY 2006—Continued 

Provider 

number 

Out-migration 

adjustment 

Qualifying county 

name 

360070 ..... 0.0028 STARK 

360078* ... 0.0159 PORTAGE 

360084 ..... 0.0028 STARK 

360086* ... 0.0168 CLARK 

360093 ..... 0.0120 DEFIANCE 

360095 ..... 0.0087 HANCOCK 

360096* ... 0.0031 COLUMBIANA 

360099 ..... 0.0087 HANCOCK 

360100 ..... 0.0028 STARK 

360107* ... 0.0213 SANDUSKY 

360131 ..... 0.0028 STARK 

360151 ..... 0.0028 STARK 

360156 ..... 0.0213 SANDUSKY 

360175* ... 0.0159 CLINTON 

360177 ..... 0.0212 FAYETTE 

360185* ... 0.0031 COLUMBIANA 

360187* ... 0.0168 CLARK 

360197* ... 0.0092 LOGAN 

370004* ... 0.0193 OTTAWA 

370014* ... 0.0831 BRYAN 

370015* ... 0.0463 MAYES 

370023 ..... 0.0084 STEPHENS 

370043 ..... 0.0294 MARSHALL 

370065 ..... 0.0121 CRAIG 

370113* ... 0.0205 DELAWARE 

370138 ..... 0.0073 TEXAS 

370149 ..... 0.0356 POTTAWATOMIE 

370179* ... 0.0314 OKFUSKEE 

380002 ..... 0.0130 JOSEPHINE 

380008* ... 0.0201 LINN 

380022* ... 0.0201 LINN 

380029 ..... 0.0073 MARION 

380051 ..... 0.0073 MARION 

380056 ..... 0.0073 MARION 

390011 ..... 0.0012 CAMBRIA 

390030* ... 0.0274 SCHUYLKILL 

390031* ... 0.0274 SCHUYLKILL 

390044 ..... 0.0200 BERKS 

390046 ..... 0.0098 YORK 

390052* ... 0.0036 CLEARFIELD 

390056 ..... 0.0042 HUNTINGDON 

390065* ... 0.0501 ADAMS 

390066* ... 0.0259 LEBANON 

390086* ... 0.0036 CLEARFIELD 

390096 ..... 0.0200 BERKS 

390101 ..... 0.0098 YORK 

390110* ... 0.0012 CAMBRIA 

390130 ..... 0.0012 CAMBRIA 

390138* ... 0.0325 FRANKLIN 

390146 ..... 0.0053 WARREN 

390150* ... 0.0206 GREENE 

390151* ... 0.0325 FRANKLIN 

390162 ..... 0.0149 NORTHAMPTON 

390173 ..... 0.0074 INDIANA 

390181* ... 0.0274 SCHUYLKILL 

390183* ... 0.0274 SCHUYLKILL 

390201* ... 0.1127 MONROE 

390233 ..... 0.0098 YORK 

420007 ..... 0.0001 SPARTANBURG 

420009* ... 0.0162 OCONEE 

420020* ... 0.0035 GEORGETOWN 

420027 ..... 0.0210 ANDERSON 

420030* ... 0.0103 COLLETON 

420039* ... 0.0156 UNION 

420043 ..... 0.0177 CHEROKEE 

420062 ..... 0.0247 CHESTERFIELD 

420068* ... 0.0097 ORANGEBURG 

420070* ... 0.0101 SUMTER 

420083 ..... 0.0001 SPARTANBURG 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23581 

TABLE 4J.—OUT-MIGRATION

ADJUSTMENT—FY 2006—Continued 

Provider 

number 

Out-migration 

adjustment 

Qualifying county 

name 

420093 ..... 0.0001 SPARTANBURG 

420098 ..... 0.0035 GEORGETOWN 

430008 ..... 0.0504 BROOKINGS 

430048 ..... 0.0088 LAWRENCE 

430094* ... 0.0088 LAWRENCE 

440008* ... 0.0663 HENDERSON 

440016 ..... 0.0224 CARROLL 

440024 ..... 0.0387 BRADLEY 

440025 ..... 0.0037 GREENE 

440033 ..... 0.0159 CAMPBELL 

440035* ... 0.0441 MONTGOMERY 

440047 ..... 0.0499 GIBSON 

440050* ... 0.0037 GREENE 

440051 ..... 0.0110 MC NAIRY 

440056 ..... 0.0321 JEFFERSON 

440060* ... 0.0499 GIBSON 

440063 ..... 0.0011 WASHINGTON 

440073* ... 0.0513 MAURY 

440105 ..... 0.0011 WASHINGTON 

440114 ..... 0.0523 LAUDERDALE 

440115 ..... 0.0499 GIBSON 

440143 ..... 0.0448 MARSHALL 

440148* ... 0.0568 DE KALB 

440153 ..... 0.0145 COCKE 

440174 ..... 0.0372 HAYWOOD 

440180* ... 0.0159 CAMPBELL 

440181 ..... 0.0407 HARDEMAN 

440182 ..... 0.0224 CARROLL 

440184 ..... 0.0011 WASHINGTON 

440185* ... 0.0387 BRADLEY 

450032* ... 0.0416 HARRISON 

450039* ... 0.0097 TARRANT 

450050 ..... 0.0750 WARD 

450059* ... 0.0073 COMAL 

450064* ... 0.0097 TARRANT 

450087* ... 0.0097 TARRANT 

450099* ... 0.0180 GRAY 

450113 ..... 0.0195 ANDERSON 

450121* ... 0.0097 TARRANT 

450135* ... 0.0097 TARRANT 

450137* ... 0.0097 TARRANT 

TABLE 4J.—OUT-MIGRATION

ADJUSTMENT—FY 2006—Continued 

Provider 

number 

Out-migration 

adjustment 

Qualifying county 

name 

450144* ... 0.0573 ANDREWS 

450151 ..... 0.0210 FAYETTE 

450163 ..... 0.0134 KLEBERG 

450187* ... 0.0264 WASHINGTON 

450194* ... 0.0328 CHEROKEE 

450214* ... 0.0368 WHARTON 

450224* ... 0.0411 WOOD 

450347* ... 0.0427 WALKER 

450362 ..... 0.0486 BURNET 

450370 ..... 0.0258 COLORADO 

450389* ... 0.0881 HENDERSON 

450395 ..... 0.0484 POLK 

450419* ... 0.0097 TARRANT 

450438* ... 0.0258 COLORADO 

450447* ... 0.0358 NAVARRO 

450451* ... 0.0551 SOMERVELL 

450465 ..... 0.0435 MATAGORDA 

450547* ... 0.0411 WOOD 

450563* ... 0.0097 TARRANT 

450565 ..... 0.0492 PALO PINTO 

450596 ..... 10.0808 HOOD 

450597 ..... 0.0077 DE WITT 

450623* ... 0.0492 FANNIN 

450626 ..... 0.0294 JACKSON 

450639* ... 0.0097 TARRANT 

450672* ... 0.0097 TARRANT 

450675* ... 0.0097 TARRANT 

450677* ... 0.0097 TARRANT 

450694* ... 0.0368 WHARTON 

450747* ... 0.0195 ANDERSON 

450755* ... 0.0484 HOCKLEY 

450763 ..... 0.0236 HUTCHINSON 

450779* ... 0.0097 TARRANT 

450813 ..... 0.0195 ANDERSON 

450858* ... 0.0097 TARRANT 

460017 ..... 0.0392 BOX ELDER 

460036* ... 0.0700 WASATCH 

460039* ... 0.0392 BOX ELDER 

470018 ..... 0.0287 WINDSOR 

470023 ..... 0.0118 CALEDONIA 

490019 ..... 0.1240 CULPEPER 

TABLE 4J.—OUT-MIGRATION

ADJUSTMENT—FY 2006—Continued 

Provider 

number 

Out-migration 

adjustment 

Qualifying county 

name 

490038 ..... 0.0022 SMYTH 

490047* ... 0.0198 PAGE 

490084 ..... 0.0167 ESSEX 

490105* ... 0.0022 SMYTH 

490110 ..... 0.0082 MONTGOMERY 

500003* ... 0.0208 SKAGIT 

500007 ..... 0.0208 SKAGIT 

500019 ..... 0.0213 LEWIS 

500021 ..... 0.0055 PIERCE 

500024* ... 0.0023 THURSTON 

500039* ... 0.0174 KITSAP 

500041* ... 0.0118 COWLITZ 

500079 ..... 0.0055 PIERCE 

500108 ..... 0.0055 PIERCE 

500118 ..... 0.0548 MASON 

500122* ... 0.0459 ISLAND 

500129 ..... 0.0055 PIERCE 

500139* ... 0.0023 THURSTON 

500143* ... 0.0023 THURSTON 

510018* ... 0.0209 JACKSON 

510028* ... 0.0141 FAYETTE 

510039 ..... 0.0112 OHIO 

510047* ... 0.0275 MARION 

510050 ..... 0.0112 OHIO 

510077* ... 0.0021 MINGO 

510088 ..... 0.0141 FAYETTE 

520028* ... 0.0157 GREEN 

520035 ..... 0.0077 SHEBOYGAN 

520042 ..... 0.0118 SAUK 

520044 ..... 0.0077 SHEBOYGAN 

520057 ..... 0.0118 SAUK 

520059* ... 0.0200 RACINE 

520071* ... 0.0239 JEFFERSON 

520076* ... 0.0181 DODGE 

520094* ... 0.0200 RACINE 

520095* ... 0.0118 SAUK 

520096* ... 0.0200 RACINE 

520102* ... 0.0298 WALWORTH 

520116* ... 0.0239 JEFFERSON 

520132 ..... 0.0077 SHEBOYGAN 

TABLE 5.—LIST OF DIAGNOSIS-RELATED GROUPS (DRGS, RELATIVE WEIGHTING FACTORS, AND GEOMETRIC AND

ARITHMETIC MEAN LENGTH OF STAY (LOS) 

DRG MDC TYPE DRG Title Weights Mean 

LOS 

Mean 

LOS 

1 ............... 01 SURG ...... CRANIOTOMY AGE >17 W CC .......................................................... 3.4276 7.6 10.1 

2 ............... 01 SURG ...... CRANIOTOMY AGE >17 W/O CC ...................................................... 1.9544 3.5 4.6 

3 ............... 01 SURG * .... CRANIOTOMY AGE 0–17 ................................................................... 1.9830 12.7 12.7 

4 ............... 01 SURG ...... NO LONGER VALID ............................................................................ .0000 .0 .0 

5 ............... 01 SURG ...... NO LONGER VALID ............................................................................ .0000 .0 0 

6 ............... 01 SURG ...... CARPAL TUNNEL RELEASE ............................................................. .7868 2.2 3.1 

7 ............... 01 SURG ...... PERIPH & CRANIAL NERVE & OTHER NERV SYST PROC W CC 2.6679 6.6 9.5 

8 ............... 01 SURG ...... PERIPH & CRANIAL NERVE & OTHER NERV SYST PROC W/O 

CC.

1.5008 2.0 2.9 

9 ............... 01 MED ......... SPINAL DISORDERS & INJURIES ..................................................... 1.3993 4.5 6.3 

10 ............. 01 MED ......... NERVOUS SYSTEM NEOPLASMS W CC ......................................... 1.2219 4.6 6.2 

11 ............. 01 MED ......... NERVOUS SYSTEM NEOPLASMS W/O CC ..................................... .8704 2.9 3.8 

12 ............. 01 MED ......... DEGENERATIVE NERVOUS SYSTEM DISORDERS ....................... .8972 4.3 5.5 

13 ............. 01 MED ......... MULTIPLE SCLEROSIS & CEREBELLAR ATAXIA ........................... .8520 4.0 5.0 

14 ............. 01 MED ......... INTRACRANIAL HEMORRHAGE OR STROKE WITH INFARCT ...... 1.2533 4.5 5.8 

15 ............. 01 MED ......... NONSPECIFIC CVA & PRECEREBRAL OCCLUSION W/O INFARCT..9402 3.7 4.6 

16 ............. 01 MED ......... NONSPECIFIC CEREBROVASCULAR DISORDERS W CC ............. 1.3315 5.0 6.5 

17 ............. 01 MED ......... NONSPECIFIC CEREBROVASCULAR DISORDERS W/O CC ......... .7191 2.5 3.2 

18 ............. 01 MED ......... CRANIAL & PERIPHERAL NERVE DISORDERS W CC ................... .9891 4.1 5.3 

19 ............. 01 MED ......... CRANIAL & PERIPHERAL NERVE DISORDERS W/O CC ............... .7058 2.7 3.4 

23582 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

TABLE 5.—LIST OF DIAGNOSIS-RELATED GROUPS (DRGS, RELATIVE WEIGHTING FACTORS, AND GEOMETRIC AND

ARITHMETIC MEAN LENGTH OF STAY (LOS)—Continued 

DRG MDC TYPE DRG Title Weights Mean 

LOS 

Mean 

LOS 

20 ............. 01 MED ......... NERVOUS SYSTEM INFECTION EXCEPT VIRAL MENINGITIS ..... 2.7787 8.0 10.4 

21 ............. 01 MED ......... VIRAL MENINGITIS ............................................................................. 1.4424 4.9 6.4 

22 ............. 01 MED ......... HYPERTENSIVE ENCEPHALOPATHY .............................................. 1.1269 4.0 5.2 

23 ............. 01 MED ......... NONTRAUMATIC STUPOR & COMA ................................................ .7695 3.0 3.9 

24 ............. 01 MED ......... SEIZURE & HEADACHE AGE >17 W CC .......................................... .9954 3.6 4.8 

25 ............. 01 MED ......... SEIZURE & HEADACHE AGE >17 W/O CC ...................................... .6165 2.5 3.1 

26 ............. 01 MED ......... SEIZURE & HEADACHE AGE 0–17 ................................................... 1.8098 3.4 6.3 

27 ............. 01 MED ......... TRAUMATIC STUPOR & COMA, COMA >1 HR ................................ 1.3455 3.2 5.1 

28 ............. 01 MED ......... TRAUMATIC STUPOR & COMA, COMA <1 HR AGE >17 W CC ..... 1.3324 4.4 5.9 

29 ............. 01 MED ......... TRAUMATIC STUPOR & COMA, COMA <1 HR AGE >17 W/O CC .7210 2.6 3.4 

30 ............. 01 MED * ...... TRAUMATIC STUPOR & COMA, COMA <1 HR AGE 0–17 .............. .3354 2.0 2.0 

31 ............. 01 MED ......... CONCUSSION AGE >17 W CC .......................................................... .9529 3.0 4.0 

32 ............. 01 MED ......... CONCUSSION AGE >17 W/O CC ...................................................... .6185 1.9 2.4 

33 ............. 01 MED * ...... CONCUSSION AGE 0–17 ................................................................... .2106 1.6 1.6 

34 ............. 01 MED ......... OTHER DISORDERS OF NERVOUS SYSTEM W CC ...................... 1.0047 3.7 4.8 

35 ............. 01 MED ......... OTHER DISORDERS OF NERVOUS SYSTEM W/O CC .................. .6253 2.4 3.0 

36 ............. 02 SURG ...... RETINAL PROCEDURES ................................................................... .7238 1.3 1.6 

37 ............. 02 SURG ...... ORBITAL PROCEDURES ................................................................... 1.1761 2.7 4.1

38 ............. 02 SURG ...... PRIMARY IRIS PROCEDURES .......................................................... .6963 2.5 3.5 

39 ............. 02 SURG ...... LENS PROCEDURES WITH OR WITHOUT VITRECTOMY ............. .7109 1.7 2.4 

40 ............. 02 SURG ...... EXTRAOCULAR PROCEDURES EXCEPT ORBIT AGE >17 ............ .9624 3.0 4.1 

41 ............. 02 SURG * .... EXTRAOCULAR PROCEDURES EXCEPT ORBIT AGE 0–17 .......... .3414 1.6 1.6 

42 ............. 02 SURG ...... INTRAOCULAR PROCEDURES EXCEPT RETINA, IRIS & LENS ... .7865 2.0 2.8 

43 ............. 02 MED ......... HYPHEMA ........................................................................................... .6146 2.4 3.1 

44 ............. 02 MED ......... ACUTE MAJOR EYE INFECTIONS .................................................... .6811 3.9 4.8 

45 ............. 02 MED ......... NEUROLOGICAL EYE DISORDERS .................................................. .7462 2.5 3.1 

46 ............. 02 MED ......... OTHER DISORDERS OF THE EYE AGE >17 W CC ........................ .7471 3.2 4.2 

47 ............. 02 MED ......... OTHER DISORDERS OF THE EYE AGE >17 W/O CC .................... .5189 2.3 2.9 

48 ............. 02 MED * ...... OTHER DISORDERS OF THE EYE AGE 0–17 ................................. .3008 2.9 2.9 

49 ............. 03 SURG ...... MAJOR HEAD & NECK PROCEDURES ............................................ 1.6375 3.2 4.4 

50 ............. 03 SURG ...... SIALOADENECTOMY ......................................................................... .8661 1.5 1.8 

51 ............. 03 SURG ...... SALIVARY GLAND PROCEDURES EXCEPT SIALOADENECTOMY .8829 1.9 2.8 

52 ............. 03 SURG ...... CLEFT LIP & PALATE REPAIR .......................................................... .8428 1.5 2.0 

53 ............. 03 SURG ...... SINUS & MASTOID PROCEDURES AGE >17 .................................. 1.3302 2.5 4.0 

54 ............. 03 SURG * .... SINUS & MASTOID PROCEDURES AGE 0–17 ................................ .4874 3.2 3.2 

55 ............. 03 SURG ...... MISCELLANEOUS EAR, NOSE, MOUTH & THROAT PROCEDURES..9577 2.1 3.1 

56 ............. 03 SURG ...... RHINOPLASTY .................................................................................... .8623 1.9 2.6 

57 ............. 03 SURG ...... T&A PROC, EXCEPT TONSILLECTOMY &/OR ADENOIDECTOMY 

ONLY, AGE >17.

1.1330 2.6 4.2 

58 ............. 03 SURG * .... T&A PROC, EXCEPT TONSILLECTOMY &/OR ADENOIDECTOMY 

ONLY, AGE 0–17.

.2768 1.5 1.5 

59 ............. 03 SURG ...... TONSILLECTOMY &/OR ADENOIDECTOMY ONLY, AGE >17 ........ .7950 1.8 2.5 

60 ............. 03 SURG * .... TONSILLECTOMY &/OR ADENOIDECTOMY ONLY, AGE 0–17 ...... .2107 1.5 1.5 

61 ............. 03 SURG ...... MYRINGOTOMY W TUBE INSERTION AGE >17 ............................. 1.2804 3.3 5.4 

62 ............. 03 SURG * .... MYRINGOTOMY W TUBE INSERTION AGE 0–17 ........................... .2984 1.3 1.3 

63 ............. 03 SURG ...... OTHER EAR, NOSE, MOUTH & THROAT O.R. PROCEDURES ..... 1.3908 3.0 4.5 

64 ............. 03 MED ......... EAR, NOSE, MOUTH & THROAT MALIGNANCY ............................. 1.1606 4.1 6.1 

65 ............. 03 MED ......... DYSEQUILIBRIUM .............................................................................. .5987 2.3 2.8 

66 ............. 03 MED ......... EPISTAXIS ........................................................................................... .5940 2.4 3.1 

67 ............. 03 MED ......... EPIGLOTTITIS ..................................................................................... .7724 2.9 3.7 

68 ............. 03 MED ......... OTITIS MEDIA & URI AGE >17 W CC ............................................... .6646 3.2 4.0 

69 ............. 03 MED ......... OTITIS MEDIA & URI AGE >17 W/O CC ........................................... .4860 2.5 3.0 

70 ............. 03 MED ......... OTITIS MEDIA & URI AGE 0–17 ........................................................ .4062 2.1 2.4 

71 ............. 03 MED ......... LARYNGOTRACHEITIS ...................................................................... .7509 3.2 4.0 

72 ............. 03 MED ......... NASAL TRAUMA & DEFORMITY ....................................................... .7479 2.6 3.5 

73 ............. 03 MED ......... OTHER EAR, NOSE, MOUTH & THROAT DIAGNOSES AGE >17 .. .8285 3.3 4.4 

74 ............. 03 MED * ...... OTHER EAR, NOSE, MOUTH & THROAT DIAGNOSES AGE 0–17 .3393 2.1 2.1 

75 ............. 04 SURG ...... MAJOR CHEST PROCEDURES ......................................................... 3.0699 7.6 9.9 

76 ............. 04 SURG ...... OTHER RESP SYSTEM O.R. PROCEDURES W CC ....................... 2.8748 8.4 11.1 

77 ............. 04 SURG ...... OTHER RESP SYSTEM O.R. PROCEDURES W/O CC .................... 1.1897 3.4 4.7 

78 ............. 04 MED ......... PULMONARY EMBOLISM .................................................................. 1.2411 5.4 6.4 

79 ............. 04 MED ......... RESPIRATORY INFECTIONS & INFLAMMATIONS AGE >17 W CC 1.6212 6.7 8.4 

80 ............. 04 MED ......... RESPIRATORY INFECTIONS & INFLAMMATIONS AGE >17 W/O 

CC.

.8872 4.4 5.5 

81 ............. 04 MED * ...... RESPIRATORY INFECTIONS & INFLAMMATIONS AGE 0–17 ........ 1.5360 6.1 6.1 

82 ............. 04 MED ......... RESPIRATORY NEOPLASMS ............................................................ 1.3925 5.1 6.8 

83 ............. 04 MED ......... MAJOR CHEST TRAUMA W CC ........................................................ .9818 4.2 5.3 

84 ............. 04 MED ......... MAJOR CHEST TRAUMA W/O CC .................................................... .5736 2.6 3.2 

85 ............. 04 MED ......... PLEURAL EFFUSION W CC .............................................................. 1.2401 4.8 6.4

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23583 

TABLE 5.—LIST OF DIAGNOSIS-RELATED GROUPS (DRGS, RELATIVE WEIGHTING FACTORS, AND GEOMETRIC AND

ARITHMETIC MEAN LENGTH OF STAY (LOS)—Continued 

DRG MDC TYPE DRG Title Weights Mean 

LOS 

Mean 

LOS 

86 ............. 04 MED ......... PLEURAL EFFUSION W/O CC ........................................................... .6943 2.8 3.6 

87 ............. 04 MED ......... PULMONARY EDEMA & RESPIRATORY FAILURE ......................... 1.3592 4.9 6.4 

88 ............. 04 MED ......... CHRONIC OBSTRUCTIVE PULMONARY DISEASE ......................... .8854 4.0 4.9 

89 ............. 04 MED ......... SIMPLE PNEUMONIA & PLEURISY AGE >17 W CC ....................... 1.0317 4.7 5.7 

90 ............. 04 MED ......... SIMPLE PNEUMONIA & PLEURISY AGE >17 W/O CC ................... .6085 3.2 3.8 

91 ............. 04 MED ......... SIMPLE PNEUMONIA & PLEURISY AGE 0–17 ................................ .8173 3.4 4.4 

92 ............. 04 MED ......... INTERSTITIAL LUNG DISEASE W CC .............................................. 1.1859 4.9 6.1 

93 ............. 04 MED ......... INTERSTITIAL LUNG DISEASE W/O CC .......................................... .7022 3.1 3.8 

94 ............. 04 MED ......... PNEUMOTHORAX W CC ................................................................... 1.1435 4.7 6.2 

95 ............. 04 MED ......... PNEUMOTHORAX W/O CC ................................................................ .6039 2.9 3.7 

96 ............. 04 MED ......... BRONCHITIS & ASTHMA AGE >17 W CC ........................................ .7356 3.6 4.4 

97 ............. 04 MED ......... BRONCHITIS & ASTHMA AGE >17 W/O CC .................................... .5340 2.8 3.4 

98 ............. 04 MED * ...... BRONCHITIS & ASTHMA AGE 0–17 ................................................. .5552 3.7 3.7 

99 ............. 04 MED ......... RESPIRATORY SIGNS & SYMPTOMS W CC ................................... .7075 2.4 3.1 

100 ........... 04 MED ......... RESPIRATORY SIGNS & SYMPTOMS W/O CC ............................... .5386 1.7 2.1 

101 ........... 04 MED ......... OTHER RESPIRATORY SYSTEM DIAGNOSES W CC .................... .8715 3.3 4.3 

102 ........... 04 MED ......... OTHER RESPIRATORY SYSTEM DIAGNOSES W/O CC ................ .5390 2.0 2.5 

103 ........... PRE SURG ...... HEART TRANSPLANT OR IMPLANT OF HEART ASSIST SYSTEM 18.3069 23.5 37.5 

104 ........... 05 SURG ...... CARDIAC VALVE & OTH MAJOR CARDIOTHORACIC PROC W 

CARD CATH.

8.2206 12.7 14.9 

105 ........... 05 SURG ...... CARDIAC VALVE & OTH MAJOR CARDIOTHORACIC PROC W/O 

CARD CATH.

6.0149 8.5 10.2 

106 ........... 05 SURG ...... CORONARY BYPASS W PTCA ......................................................... 7.0409 9.5 11.2 

107 ........... 05 SURG ...... CORONARY BYPASS W CARDIAC CATH ........................................ 5.4802 9.4 10.7 

108 ........... 05 SURG ...... OTHER CARDIOTHORACIC PROCEDURES .................................... 5.7861 8.6 10.9 

109 ........... 05 SURG ...... CORONARY BYPASS W/O PTCA OR CARDIAC CATH ................... 4.0452 6.8 7.9 

110 ........... 05 SURG ...... MAJOR CARDIOVASCULAR PROCEDURES W CC ........................ 3.8908 5.8 8.4 

111 ........... 05 SURG ...... MAJOR CARDIOVASCULAR PROCEDURES W/O CC ..................... 2.4927 2.6 3.4 

112 ........... 05 SURG ...... NO LONGER VALID ............................................................................ .0000 .0 .0 

113 ........... 05 SURG ...... AMPUTATION FOR CIRC SYSTEM DISORDERS EXCEPT UPPER 

LIMB & TOE.

3.1547 10.8 13.7 

114 ........... 05 SURG ...... UPPER LIMB & TOE AMPUTATION FOR CIRC SYSTEM DISORDERS.1.7288 6.7 8.9 

115 ........... 05 SURG ...... PRM CARD PACEM IMPL W AMI/HR/SHOCK OR AICD LEAD OR 

GNRTR.

3.5839 4.5 6.8 

116 ........... 05 SURG ...... OTHER PERMANENT CARDIAC PACEMAKER IMPLANT ............... 2.2975 3.0 4.3 

117 ........... 05 SURG ...... CARDIAC PACEMAKER REVISION EXCEPT DEVICE REPLACEMENT.1.3232 2.6 4.2 

118 ........... 05 SURG ...... CARDIAC PACEMAKER DEVICE REPLACEMENT .......................... 1.6347 2.1 3.0 

119 ........... 05 SURG ...... VEIN LIGATION & STRIPPING ........................................................... 1.3473 3.3 5.5 

120 ........... 05 SURG ...... OTHER CIRCULATORY SYSTEM O.R. PROCEDURES .................. 2.3814 5.9 9.2 

121 ........... 05 MED ......... CIRCULATORY DISORDERS W AMI & MAJOR COMP, DISCHARGED ALIVE.1.6110 5.3 6.6 

122 ........... 05 MED ......... CIRCULATORY DISORDERS W AMI W/O MAJOR COMP, DISCHARGED ALIVE..9818 2.8 3.5 

123 ........... 05 MED ......... CIRCULATORY DISORDERS W AMI, EXPIRED ............................... 1.5321 2.9 4.8 

124 ........... 05 MED ......... CIRCULATORY DISORDERS EXCEPT AMI, W CARD CATH & 

COMPLEX DIAG.

1.4417 3.3 4.4 

125 ........... 05 MED ......... CIRCULATORY DISORDERS EXCEPT AMI, W CARD CATH W/O 

COMPLEX DIAG.

1.0932 2.1 2.7 

126 ........... 05 MED ......... ACUTE & SUBACUTE ENDOCARDITIS ............................................ 2.7261 9.4 11.9 

127 ........... 05 MED ......... HEART FAILURE & SHOCK ............................................................... 1.0330 4.1 5.2

128 ........... 05 MED ......... DEEP VEIN THROMBOPHLEBITIS .................................................... .6919 4.4 5.2 

129 ........... 05 MED ......... CARDIAC ARREST, UNEXPLAINED .................................................. 1.0365 1.7 2.6 

130 ........... 05 MED ......... PERIPHERAL VASCULAR DISORDERS W CC ................................ .9412 4.4 5.5 

131 ........... 05 MED ......... PERIPHERAL VASCULAR DISORDERS W/O CC ............................ .5555 3.2 3.9 

132 ........... 05 MED ......... ATHEROSCLEROSIS W CC ............................................................... .6252 2.2 2.8 

133 ........... 05 MED ......... ATHEROSCLEROSIS W/O CC ........................................................... .5323 1.8 2.2 

134 ........... 05 MED ......... HYPERTENSION ................................................................................. .6057 2.5 3.1 

135 ........... 05 MED ......... CARDIAC CONGENITAL & VALVULAR DISORDERS AGE >17 W 

CC.

.8969 3.3 4.4 

136 ........... 05 MED ......... CARDIAC CONGENITAL & VALVULAR DISORDERS AGE >17 W/ 

O CC.

.6228 2.2 2.8 

137 ........... 05 MED * ...... CARDIAC CONGENITAL & VALVULAR DISORDERS AGE 0–17 .... .8275 3.3 3.3 

138 ........... 05 MED ......... CARDIAC ARRHYTHMIA & CONDUCTION DISORDERS W CC ..... .8313 3.1 3.9 

139 ........... 05 MED ......... CARDIAC ARRHYTHMIA & CONDUCTION DISORDERS W/O CC .5222 2.0 2.4 

140 ........... 05 MED ......... ANGINA PECTORIS ............................................................................ .5076 2.0 2.4 

141 ........... 05 MED ......... SYNCOPE & COLLAPSE W CC ......................................................... .7513 2.7 3.5 

142 ........... 05 MED ......... SYNCOPE & COLLAPSE W/O CC ..................................................... .5848 2.0 2.5 

143 ........... 05 MED ......... CHEST PAIN ....................................................................................... .5655 1.7 2.1 

23584 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

TABLE 5.—LIST OF DIAGNOSIS-RELATED GROUPS (DRGS, RELATIVE WEIGHTING FACTORS, AND GEOMETRIC AND

ARITHMETIC MEAN LENGTH OF STAY (LOS)—Continued 

DRG MDC TYPE DRG Title Weights Mean 

LOS 

Mean 

LOS 

144 ........... 05 MED ......... OTHER CIRCULATORY SYSTEM DIAGNOSES W CC .................... 1.2734 4.1 5.8 

145 ........... 05 MED ......... OTHER CIRCULATORY SYSTEM DIAGNOSES W/O CC ................ .5843 2.1 2.6 

146 ........... 06 SURG ...... RECTAL RESECTION W CC .............................................................. 2.6565 8.6 10.0 

147 ........... 06 SURG ...... RECTAL RESECTION W/O CC .......................................................... 1.4778 5.2 5.8 

148 ........... 06 SURG ...... MAJOR SMALL & LARGE BOWEL PROCEDURES W CC ............... 3.4400 10.0 12.3 

149 ........... 06 SURG ...... MAJOR SMALL & LARGE BOWEL PROCEDURES W/O CC ........... 1.4304 5.4 6.0 

150 ........... 06 SURG ...... PERITONEAL ADHESIOLYSIS W CC ................................................ 2.7986 8.9 11.0 

151 ........... 06 SURG ...... PERITONEAL ADHESIOLYSIS W/O CC ............................................ 1.2620 4.0 5.1 

152 ........... 06 SURG ...... MINOR SMALL & LARGE BOWEL PROCEDURES W CC ............... 1.8768 6.7 8.0 

153 ........... 06 SURG ...... MINOR SMALL & LARGE BOWEL PROCEDURES W/O CC ............ 1.0833 4.5 5.0 

154 ........... 06 SURG ...... STOMACH, ESOPHAGEAL & DUODENAL PROCEDURES AGE 

>17 W CC.

4.0333 9.9 13.2 

155 ........... 06 SURG ...... STOMACH, ESOPHAGEAL & DUODENAL PROCEDURES AGE 

>17 W/O CC.

1.2855 3.1 4.1 

156 ........... 06 SURG * .... STOMACH, ESOPHAGEAL & DUODENAL PROCEDURES AGE 0–

17.

.8522 6.0 6.0 

157 ........... 06 SURG ...... ANAL & STOMAL PROCEDURES W CC ........................................... 1.3317 4.1 5.8 

158 ........... 06 SURG ...... ANAL & STOMAL PROCEDURES W/O CC ....................................... .6634 2.1 2.6 

159 ........... 06 SURG ...... HERNIA PROCEDURES EXCEPT INGUINAL & FEMORAL AGE 

>17 W CC.

1.4163 3.8 5.1 

160 ........... 06 SURG ...... HERNIA PROCEDURES EXCEPT INGUINAL & FEMORAL AGE 

>17 W/O CC.

.8423 2.2 2.7 

161 ........... 06 SURG ...... INGUINAL & FEMORAL HERNIA PROCEDURES AGE >17 W CC .. 1.1998 3.1 4.4 

162 ........... 06 SURG ...... INGUINAL & FEMORAL HERNIA PROCEDURES AGE >17 W/O 

CC.

.6763 1.7 2.1 

163 ........... 06 SURG ...... HERNIA PROCEDURES AGE 0–17 ................................................... .6711 2.2 2.9 

164 ........... 06 SURG ...... APPENDECTOMY W COMPLICATED PRINCIPAL DIAG W CC ...... 2.2488 6.6 8.0 

165 ........... 06 SURG ...... APPENDECTOMY W COMPLICATED PRINCIPAL DIAG W/O CC .. 1.1833 3.6 4.2 

166 ........... 06 SURG ...... APPENDECTOMY W/O COMPLICATED PRINCIPAL DIAG W CC .. 1.4517 3.3 4.5 

167 ........... 06 SURG ...... APPENDECTOMY W/O COMPLICATED PRINCIPAL DIAG W/O CC .8918 1.9 2.2 

168 ........... 03 SURG ...... MOUTH PROCEDURES W CC .......................................................... 1.2650 3.3 4.9 

169 ........... 03 SURG ...... MOUTH PROCEDURES W/O CC ....................................................... .7251 1.8 2.3 

170 ........... 06 SURG ...... OTHER DIGESTIVE SYSTEM O.R. PROCEDURES W CC .............. 2.9522 7.8 11.0 

171 ........... 06 SURG ...... OTHER DIGESTIVE SYSTEM O.R. PROCEDURES W/O CC .......... 1.1837 3.1 4.1 

172 ........... 06 MED ......... DIGESTIVE MALIGNANCY W CC ...................................................... 1.4115 5.1 7.0 

173 ........... 06 MED ......... DIGESTIVE MALIGNANCY W/O CC .................................................. .7442 2.7 3.6 

174 ........... 06 MED ......... G.I. HEMORRHAGE W CC ................................................................. 1.0138 3.8 4.7 

175 ........... 06 MED ......... G.I. HEMORRHAGE W/O CC ............................................................. .5644 2.4 2.9 

176 ........... 06 MED ......... COMPLICATED PEPTIC ULCER ........................................................ 1.1228 4.1 5.2 

177 ........... 06 MED ......... UNCOMPLICATED PEPTIC ULCER W CC ....................................... .9158 3.6 4.4 

178 ........... 06 MED ......... UNCOMPLICATED PEPTIC ULCER W/O CC .................................... .7014 2.6 3.1 

179 ........... 06 MED ......... INFLAMMATORY BOWEL DISEASE .................................................. 1.0877 4.5 5.9 

180 ........... 06 MED ......... G.I. OBSTRUCTION W CC ................................................................. .9769 4.2 5.4 

181 ........... 06 MED ......... G.I. OBSTRUCTION W/O CC ............................................................. .5609 2.8 3.3 

182 ........... 06 MED ......... ESOPHAGITIS, GASTROENT & MISC DIGEST DISORDERS AGE 

>17 W CC.

.8463 3.4 4.5 

183 ........... 06 MED ......... ESOPHAGITIS, GASTROENT & MISC DIGEST DISORDERS AGE 

>17 W/O CC.

.5846 2.3 2.9 

184 ........... 06 MED ......... ESOPHAGITIS, GASTROENT & MISC DIGEST DISORDERS AGE 

0–17.

.5700 2.5 3.3 

185 ........... 03 MED ......... DENTAL & ORAL DIS EXCEPT EXTRACTIONS & RESTORATIONS, AGE >17..8689 3.3 4.5 

186 ........... 03 MED * ...... DENTAL & ORAL DIS EXCEPT EXTRACTIONS & RESTORATIONS, AGE 0–17..3248 2.9 2.9 

187 ........... 03 MED ......... DENTAL EXTRACTIONS & RESTORATIONS ................................... .8435 3.1 4.2 

188 ........... 06 MED ......... OTHER DIGESTIVE SYSTEM DIAGNOSES AGE >17 W CC .......... 1.1257 4.2 5.6 

189 ........... 06 MED ......... OTHER DIGESTIVE SYSTEM DIAGNOSES AGE >17 W/O CC ....... .6052 2.4 3.1 

190 ........... 06 MED ......... OTHER DIGESTIVE SYSTEM DIAGNOSES AGE 0–17 .................... .6258 3.2 4.4 

191 ........... 07 SURG ...... PANCREAS, LIVER & SHUNT PROCEDURES W CC ...................... 3.9443 9.0 12.8 

192 ........... 07 SURG ...... PANCREAS, LIVER & SHUNT PROCEDURES W/O CC .................. 1.6802 4.3 5.7 

193 ........... 07 SURG ...... BILIARY TRACT PROC EXCEPT ONLY CHOLECYST W OR W/O 

C.D.E. W CC.

3.2837 9.9 12.1 

194 ........... 07 SURG ...... BILIARY TRACT PROC EXCEPT ONLY CHOLECYST W OR W/O 

C.D.E. W/O CC.

1.5786 5.6 6.7 

195 ........... 07 SURG ...... CHOLECYSTECTOMY W C.D.E. W CC ............................................ 3.0503 8.8 10.6 

196 ........... 07 SURG ...... CHOLECYSTECTOMY W C.D.E. W/O CC ......................................... 1.6011 4.9 5.7 

197 ........... 07 SURG ...... CHOLECYSTECTOMY EXCEPT BY LAPAROSCOPE W/O C.D.E. 

W CC.

2.5397 7.5 9.2 

198 ........... 07 SURG ...... CHOLECYSTECTOMY EXCEPT BY LAPAROSCOPE W/O C.D.E. 

W/O CC.

1.1571 3.7 4.3 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23585 

TABLE 5.—LIST OF DIAGNOSIS-RELATED GROUPS (DRGS, RELATIVE WEIGHTING FACTORS, AND GEOMETRIC AND

ARITHMETIC MEAN LENGTH OF STAY (LOS)—Continued 

DRG MDC TYPE DRG Title Weights Mean 

LOS 

Mean 

LOS 

199 ........... 07 SURG ...... HEPATOBILIARY DIAGNOSTIC PROCEDURE FOR MALIGNANCY 2.4077 6.8 9.5 

200 ........... 07 SURG ...... HEPATOBILIARY DIAGNOSTIC PROCEDURE FOR NON-MALIGNANCY.2.7777 6.4 9.8 

201 ........... 07 SURG ...... OTHER HEPATOBILIARY OR PANCREAS O.R. PROCEDURES .... 3.7156 9.9 13.8 

202 ........... 07 MED ......... CIRRHOSIS & ALCOHOLIC HEPATITIS ............................................ 1.3463 4.7 6.3 

203 ........... 07 MED ......... MALIGNANCY OF HEPATOBILIARY SYSTEM OR PANCREAS ...... 1.3719 4.9 6.6 

204 ........... 07 MED ......... DISORDERS OF PANCREAS EXCEPT MALIGNANCY .................... 1.1216 4.2 5.6 

205 ........... 07 MED ......... DISORDERS OF LIVER EXCEPT MALIG, CIRR, ALC HEPA W CC 1.2026 4.4 6.0 

206 ........... 07 MED ......... DISORDERS OF LIVER EXCEPT MALIG, CIRR, ALC HEPA W/O 

CC.

.7289 3.0 3.9 

207 ........... 07 MED ......... DISORDERS OF THE BILIARY TRACT W CC .................................. 1.1730 4.1 5.3 

208 ........... 07 MED ......... DISORDERS OF THE BILIARY TRACT W/O CC .............................. .6880 2.3 2.9 

209 ........... 08 SURG ...... NO LONGER VALID ............................................................................ .0000 17.1 17.1 

210 ........... 08 SURG ...... HIP & FEMUR PROCEDURES EXCEPT MAJOR JOINT AGE >17 

W CC.

1.9035 6.1 6.9 

211 ........... 08 SURG ...... HIP & FEMUR PROCEDURES EXCEPT MAJOR JOINT AGE >17 

W/O CC.

1.2676 4.4 4.7 

212 ........... 08 SURG ...... HIP & FEMUR PROCEDURES EXCEPT MAJOR JOINT AGE 0–17 1.2786 2.4 2.9 

213 ........... 08 SURG ...... AMPUTATION FOR MUSCULOSKELETAL SYSTEM & CONN TISSUE DISORDERS.2.0393 7.2 9.7 

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.

1.9099 3.3 5.8 

217 ........... 08 SURG ...... WND DEBRID & SKN GRFT EXCEPT HAND, FOR MUSCSKELET 

& CONN TISS DIS.

3.0414 9.3 13.2 

218 ........... 08 SURG ...... LOWER EXTREM & HUMER PROC EXCEPT HIP, FOOT, FEMUR 

AGE >17 W CC.

1.6068 4.3 5.5 

219 ........... 08 SURG ...... LOWER EXTREM & HUMER PROC EXCEPT HIP, FOOT, FEMUR 

AGE >17 W/O CC.

1.0427 2.6 3.1 

220 ........... 08 SURG * .... LOWER EXTREM & HUMER PROC EXCEPT HIP, FOOT, FEMUR 

AGE 0–17.

.5904 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.1.1119 2.3 3.2 

224 ........... 08 SURG ...... SHOULDER, ELBOW OR FOREARM PROC, EXC MAJOR JOINT 

PROC, W/O CC.

.8172 1.6 1.9 

225 ........... 08 SURG ...... FOOT PROCEDURES ......................................................................... 1.2189 3.7 5.2 

226 ........... 08 SURG ...... SOFT TISSUE PROCEDURES W CC ................................................ 1.5839 4.5 6.5 

227 ........... 08 SURG ...... SOFT TISSUE PROCEDURES W/O CC ............................................ .8338 2.1 2.6 

228 ........... 08 SURG ...... MAJOR THUMB OR JOINT PROC, OR OTH HAND OR WRIST 

PROC W CC.

1.1414 2.8 4.1 

229 ........... 08 SURG ...... HAND OR WRIST PROC, EXCEPT MAJOR JOINT PROC, W/O CC .6957 1.9 2.5 

230 ........... 08 SURG ...... LOCAL EXCISION & REMOVAL OF INT FIX DEVICES OF HIP & 

FEMUR.

1.3137 3.7 5.6 

231 ........... 08 SURG ...... NO LONGER VALID ............................................................................ .0000 .0 .0 

232 ........... 08 SURG ...... ARTHROSCOPY ................................................................................. .9699 1.8 2.8 

233 ........... 08 SURG ...... OTHER MUSCULOSKELET SYS & CONN TISS O.R. PROC W CC 1.9137 4.6 6.8 

234 ........... 08 SURG ...... OTHER MUSCULOSKELET SYS & CONN TISS O.R. PROC W/O 

CC.

1.2204 2.0 2.8 

235 ........... 08 MED ......... FRACTURES OF FEMUR ................................................................... .7770 3.8 4.8

236 ........... 08 MED ......... FRACTURES OF HIP & PELVIS ........................................................ .7393 3.8 4.6 

237 ........... 08 MED ......... SPRAINS, STRAINS, & DISLOCATIONS OF HIP, PELVIS & THIGH .6084 3.0 3.7 

238 ........... 08 MED ......... OSTEOMYELITIS ................................................................................ 1.4237 6.7 8.6 

239 ........... 08 MED ......... PATHOLOGICAL FRACTURES & MUSCULOSKELETAL & CONN 

TISS MALIGNANCY.

1.0758 5.0 6.2 

240 ........... 08 MED ......... CONNECTIVE TISSUE DISORDERS W CC ...................................... 1.4024 5.0 6.7 

241 ........... 08 MED ......... CONNECTIVE TISSUE DISORDERS W/O CC .................................. .6613 3.0 3.7 

242 ........... 08 MED ......... SEPTIC ARTHRITIS ............................................................................ 1.1452 5.1 6.7 

243 ........... 08 MED ......... MEDICAL BACK PROBLEMS ............................................................. .7752 3.6 4.6 

244 ........... 08 MED ......... BONE DISEASES & SPECIFIC ARTHROPATHIES W CC ................ .7098 3.6 4.5 

245 ........... 08 MED ......... BONE DISEASES & SPECIFIC ARTHROPATHIES W/O CC ............ .4555 2.5 3.1 

246 ........... 08 MED ......... NON-SPECIFIC ARTHROPATHIES .................................................... .5910 2.8 3.6 

247 ........... 08 MED ......... SIGNS & SYMPTOMS OF MUSCULOSKELETAL SYSTEM & 

CONN TISSUE.

.5787 2.6 3.3 

248 ........... 08 MED ......... TENDONITIS, MYOSITIS & BURSITIS ............................................... .8556 3.8 4.8 

249 ........... 08 MED ......... AFTERCARE, MUSCULOSKELETAL SYSTEM & CONNECTIVE 

TISSUE.

.7025 2.7 3.8 

23586 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

TABLE 5.—LIST OF DIAGNOSIS-RELATED GROUPS (DRGS, RELATIVE WEIGHTING FACTORS, AND GEOMETRIC AND

ARITHMETIC MEAN LENGTH OF STAY (LOS)—Continued 

DRG MDC TYPE DRG Title Weights Mean 

LOS 

Mean 

LOS 

250 ........... 08 MED ......... FX, SPRN, STRN & DISL OF FOREARM, HAND, FOOT AGE >17 

W CC.

.6949 3.2 3.9 

251 ........... 08 MED ......... FX, SPRN, STRN & DISL OF FOREARM, HAND, FOOT AGE >17 

W/O CC.

.4752 2.3 2.8 

252 ........... 08 MED * ...... FX, SPRN, STRN & DISL OF FOREARM, HAND, FOOT AGE 0–17 .2563 1.8 1.8 

253 ........... 08 MED ......... FX, SPRN, STRN & DISL OF UPARM, LOWLEG EX FOOT AGE 

>17 W CC.

.7734 3.8 4.6 

254 ........... 08 MED ......... FX, SPRN, STRN & DISL OF UPARM, LOWLEG EX FOOT AGE 

>17 W/O CC.

.4588 2.6 3.1 

255 ........... 08 MED * ...... FX, SPRN, STRN & DISL OF UPARM, LOWLEG EX FOOT AGE 0–

17.

.2985 2.9 2.9 

256 ........... 08 MED ......... OTHER MUSCULOSKELETAL SYSTEM & CONNECTIVE TISSUE 

DIAGNOSES.

.8459 3.9 5.1 

257 ........... 09 SURG ...... TOTAL MASTECTOMY FOR MALIGNANCY W CC .......................... .8958 2.0 2.6 

258 ........... 09 SURG ...... TOTAL MASTECTOMY FOR MALIGNANCY W/O CC ...................... .7129 1.5 1.7 

259 ........... 09 SURG ...... SUBTOTAL MASTECTOMY FOR MALIGNANCY W CC ................... .9650 1.8 2.8 

260 ........... 09 SURG ...... SUBTOTAL MASTECTOMY FOR MALIGNANCY W/O CC ............... .7028 1.2 1.4 

261 ........... 09 SURG ...... BREAST PROC FOR NON-MALIGNANCY EXCEPT BIOPSY & 

LOCAL EXCISION.

.9710 1.6 2.2 

262 ........... 09 SURG ...... BREAST BIOPSY & LOCAL EXCISION FOR NON-MALIGNANCY .. .9783 3.4 4.8 

263 ........... 09 SURG ...... SKIN GRAFT &/OR DEBRID FOR SKN ULCER OR CELLULITIS W 

CC.

2.1033 8.5 11.4 

264 ........... 09 SURG ...... SKIN GRAFT &/OR DEBRID FOR SKN ULCER OR CELLULITIS 

W/O CC.

1.0576 5.0 6.5 

265 ........... 09 SURG ...... SKIN GRAFT &/OR DEBRID EXCEPT FOR SKIN ULCER OR 

CELLULITIS W CC.

1.6577 4.4 6.7 

266 ........... 09 SURG ...... SKIN GRAFT &/OR DEBRID EXCEPT FOR SKIN ULCER OR 

CELLULITIS W/O CC.

.8664 2.3 3.2 

267 ........... 09 SURG ...... PERIANAL & PILONIDAL PROCEDURES ......................................... .8946 2.8 4.2 

268 ........... 09 SURG ...... SKIN, SUBCUTANEOUS TISSUE & BREAST PLASTIC PROCEDURES.1.1389 2.4 3.5 

269 ........... 09 SURG ...... OTHER SKIN, SUBCUT TISS & BREAST PROC W CC ................... 1.8291 6.2 8.6 

270 ........... 09 SURG ...... OTHER SKIN, SUBCUT TISS & BREAST PROC W/O CC ............... .8270 2.7 3.8 

271 ........... 09 MED ......... SKIN ULCERS ..................................................................................... 1.0072 5.5 7.0 

272 ........... 09 MED ......... MAJOR SKIN DISORDERS W CC ..................................................... .9814 4.5 5.9 

273 ........... 09 MED ......... MAJOR SKIN DISORDERS W/O CC .................................................. .5536 2.9 3.7 

274 ........... 09 MED ......... MALIGNANT BREAST DISORDERS W CC ....................................... 1.1223 4.7 6.3 

275 ........... 09 MED ......... MALIGNANT BREAST DISORDERS W/O CC ................................... .5302 2.4 3.2 

276 ........... 09 MED ......... NON-MALIGANT BREAST DISORDERS ........................................... .6879 3.5 4.5 

277 ........... 09 MED ......... CELLULITIS AGE >17 W CC .............................................................. .8652 4.6 5.6

278 ........... 09 MED ......... CELLULITIS AGE >17 W/O CC .......................................................... .5371 3.4 4.1 

279 ........... 09 MED * ...... CELLULITIS AGE 0–17 ....................................................................... .7810 4.2 4.2 

280 ........... 09 MED ......... TRAUMA TO THE SKIN, SUBCUT TISS & BREAST AGE >17 W 

CC.

.7309 3.2 4.1 

281 ........... 09 MED ......... TRAUMA TO THE SKIN, SUBCUT TISS & BREAST AGE >17 W/O 

CC.

.4897 2.3 2.9 

282 ........... 09 MED * ...... TRAUMA TO THE SKIN, SUBCUT TISS & BREAST AGE 0–17 ...... .2596 2.2 2.2 

283 ........... 09 MED ......... MINOR SKIN DISORDERS W CC ...................................................... .7398 3.5 4.6 

284 ........... 09 MED ......... MINOR SKIN DISORDERS W/O CC .................................................. .4563 2.4 3.0 

285 ........... 10 SURG ...... AMPUTAT OF LOWER LIMB FOR ENDOCRINE, NUTRIT,& 

METABOL DISORDERS.

2.1793 8.2 10.5 

286 ........... 10 SURG ...... ADRENAL & PITUITARY PROCEDURES .......................................... 1.9353 4.0 5.5 

287 ........... 10 SURG ...... SKIN GRAFTS & WOUND DEBRID FOR ENDOC, NUTRIT & 

METAB DISORDERS.

1.9237 7.8 10.3 

288 ........... 10 SURG ...... O.R. PROCEDURES FOR OBESITY .................................................. 2.0358 3.2 4.1 

289 ........... 10 SURG ...... PARATHYROID PROCEDURES ......................................................... .9314 1.7 2.6 

290 ........... 10 SURG ...... THYROID PROCEDURES .................................................................. .8875 1.6 2.1 

291 ........... 10 SURG ...... THYROGLOSSAL PROCEDURES ..................................................... 1.1155 1.5 2.8 

292 ........... 10 SURG ...... OTHER ENDOCRINE, NUTRIT & METAB O.R. PROC W CC .......... 2.6316 7.3 10.3 

293 ........... 10 SURG ...... OTHER ENDOCRINE, NUTRIT & METAB O.R. PROC W/O CC ...... 1.3434 3.2 4.5 

294 ........... 10 MED ......... DIABETES AGE >35 ........................................................................... .7642 3.3 4.3 

295 ........... 10 MED ......... DIABETES AGE 0–35 ......................................................................... .7250 2.9 3.7 

296 ........... 10 MED ......... NUTRITIONAL & MISC METABOLIC DISORDERS AGE >17 W CC .8175 3.7 4.8 

297 ........... 10 MED ......... NUTRITIONAL & MISC METABOLIC DISORDERS AGE >17 W/O 

CC.

.4845 2.5 3.1 

298 ........... 10 MED ......... NUTRITIONAL & MISC METABOLIC DISORDERS AGE 0–17 ......... .5246 2.5 4.0 

299 ........... 10 MED ......... INBORN ERRORS OF METABOLISM ................................................ 1.0293 3.7 5.2 

300 ........... 10 MED ......... ENDOCRINE DISORDERS W CC ...................................................... 1.0918 4.6 6.0 

301 ........... 10 MED ......... ENDOCRINE DISORDERS W/O CC .................................................. .6113 2.7 3.4 

302 ........... 11 SURG ...... KIDNEY TRANSPLANT ....................................................................... 3.1542 7.0 8.2 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23587 

TABLE 5.—LIST OF DIAGNOSIS-RELATED GROUPS (DRGS, RELATIVE WEIGHTING FACTORS, AND GEOMETRIC AND

ARITHMETIC MEAN LENGTH OF STAY (LOS)—Continued 

DRG MDC TYPE DRG Title Weights Mean 

LOS 

Mean 

LOS 

303 ........... 11 SURG ...... KIDNEY, URETER & MAJOR BLADDER PROCEDURES FOR 

NEOPLASM.

2.2358 5.9 7.4 

304 ........... 11 SURG ...... KIDNEY, URETER & MAJOR BLADDER PROC FOR NON-NEOPL 

W CC.

2.3647 6.1 8.6 

305 ........... 11 SURG ...... KIDNEY, URETER & MAJOR BLADDER PROC FOR NON-NEOPL 

W/O CC.

1.1580 2.6 3.2 

306 ........... 11 SURG ...... PROSTATECTOMY W CC .................................................................. 1.2674 3.6 5.5 

307 ........... 11 SURG ...... PROSTATECTOMY W/O CC .............................................................. .6192 1.7 2.1 

308 ........... 11 SURG ...... MINOR BLADDER PROCEDURES W CC ......................................... 1.6518 4.0 6.2 

309 ........... 11 SURG ...... MINOR BLADDER PROCEDURES W/O CC ...................................... .9082 1.6 2.0 

310 ........... 11 SURG ...... TRANSURETHRAL PROCEDURES W CC ........................................ 1.1948 3.1 4.5 

311 ........... 11 SURG ...... TRANSURETHRAL PROCEDURES W/O CC .................................... .6425 1.5 1.9 

312 ........... 11 SURG ...... URETHRAL PROCEDURES, AGE >17 W CC ................................... 1.1170 3.2 4.8 

313 ........... 11 SURG ...... URETHRAL PROCEDURES, AGE >17 W/O CC ............................... .6756 1.8 2.2 

314 ........... 11 SURG * .... URETHRAL PROCEDURES, AGE 0–17 ............................................ .5004 2.3 2.3 

315 ........... 11 SURG ...... OTHER KIDNEY & URINARY TRACT O.R. PROCEDURES ............. 2.0801 3.6 6.8 

316 ........... 11 MED ......... RENAL FAILURE ................................................................................. 1.2673 4.9 6.4 

317 ........... 11 MED ......... ADMIT FOR RENAL DIALYSIS ........................................................... .7965 2.4 3.5 

318 ........... 11 MED ......... KIDNEY & URINARY TRACT NEOPLASMS W CC ........................... 1.1535 4.2 5.8 

319 ........... 11 MED ......... KIDNEY & URINARY TRACT NEOPLASMS W/O CC ....................... .6388 2.1 2.8 

320 ........... 11 MED ......... KIDNEY & URINARY TRACT INFECTIONS AGE >17 W CC ........... .8644 4.2 5.2 

321 ........... 11 MED ......... KIDNEY & URINARY TRACT INFECTIONS AGE >17 W/O CC ........ .5644 3.0 3.6 

322 ........... 11 MED ......... KIDNEY & URINARY TRACT INFECTIONS AGE 0–17 ..................... .5569 2.9 3.5 

323 ........... 11 MED ......... URINARY STONES W CC, &/OR ESW LITHOTRIPSY ..................... .8200 2.3 3.1 

324 ........... 11 MED ......... URINARY STONES W/O CC .............................................................. .5045 1.6 1.9 

325 ........... 11 MED ......... KIDNEY & URINARY TRACT SIGNS & SYMPTOMS AGE >17 W 

CC.

.6417 2.9 3.7 

326 ........... 11 MED ......... KIDNEY & URINARY TRACT SIGNS & SYMPTOMS AGE >17 W/O 

CC.

.4385 2.1 2.6 

327 ........... 11 MED * ...... KIDNEY & URINARY TRACT SIGNS & SYMPTOMS AGE 0–17 ...... .3742 3.1 3.1 

328 ........... 11 MED ......... URETHRAL STRICTURE AGE >17 W CC ......................................... .7085 2.6 3.5 

329 ........... 11 MED ......... URETHRAL STRICTURE AGE >17 W/O CC ..................................... .4712 1.5 1.8 

330 ........... 11 MED * ...... URETHRAL STRICTURE AGE 0–17 .................................................. .3222 1.6 1.6 

331 ........... 11 MED ......... OTHER KIDNEY & URINARY TRACT DIAGNOSES AGE >17 W 

CC.

1.0606 4.1 5.5 

332 ........... 11 MED ......... OTHER KIDNEY & URINARY TRACT DIAGNOSES AGE >17 W/O 

CC.

.6119 2.4 3.1 

333 ........... 11 MED ......... OTHER KIDNEY & URINARY TRACT DIAGNOSES AGE 0–17 ....... .9788 3.6 5.4 

334 ........... 12 SURG ...... MAJOR MALE PELVIC PROCEDURES W CC .................................. 1.4366 3.5 4.3 

335 ........... 12 SURG ...... MAJOR MALE PELVIC PROCEDURES W/O CC .............................. 1.0980 2.4 2.7 

336 ........... 12 SURG ...... TRANSURETHRAL PROSTATECTOMY W CC ................................. .8409 2.5 3.3 

337 ........... 12 SURG ...... TRANSURETHRAL PROSTATECTOMY W/O CC ............................. .5737 1.7 1.9 

338 ........... 12 SURG ...... TESTES PROCEDURES, FOR MALIGNANCY .................................. 1.3738 3.9 6.2 

339 ........... 12 SURG ...... TESTES PROCEDURES, NON-MALIGNANCY AGE >17 ................. 1.1809 3.2 5.1 

340 ........... 12 SURG * .... TESTES PROCEDURES, NON-MALIGNANCY AGE 0–17 ............... .2864 2.4 2.4 

341 ........... 12 SURG ...... PENIS PROCEDURES ........................................................................ 1.2585 1.9 3.2 

342 ........... 12 SURG ...... CIRCUMCISION AGE >17 .................................................................. .8721 2.5 3.4 

343 ........... 12 SURG * .... CIRCUMCISION AGE 0–17 ................................................................ .1557 1.7 1.7 

344 ........... 12 SURG ...... OTHER MALE REPRODUCTIVE SYSTEM O.R. PROCEDURES 

FOR MALIGNANCY.

1.2458 1.7 2.7 

345 ........... 12 SURG ...... OTHER MALE REPRODUCTIVE SYSTEM O.R. PROC EXCEPT 

FOR MALIGNANCY.

1.1474 3.1 4.8 

346 ........... 12 MED ......... MALIGNANCY, MALE REPRODUCTIVE SYSTEM, W CC ................ 1.0439 4.2 5.7 

347 ........... 12 MED ......... MALIGNANCY, MALE REPRODUCTIVE SYSTEM, W/O CC ............ .6080 2.2 3.0 

348 ........... 12 MED ......... BENIGN PROSTATIC HYPERTROPHY W CC .................................. .7191 3.2 4.1 

349 ........... 12 MED ......... BENIGN PROSTATIC HYPERTROPHY W/O CC .............................. .4223 1.9 2.4 

350 ........... 12 MED ......... INFLAMMATION OF THE MALE REPRODUCTIVE SYSTEM ........... .7274 3.5 4.5 

351 ........... 12 MED * ...... STERILIZATION, MALE ...................................................................... .2389 1.3 1.3 

352 ........... 12 MED ......... OTHER MALE REPRODUCTIVE SYSTEM DIAGNOSES ................. .7388 2.9 4.0 

353 ........... 13 SURG ...... PELVIC EVISCERATION, RADICAL HYSTERECTOMY & RADICAL 

VULVECTOMY.

1.8474 4.7 6.3 

354 ........... 13 SURG ...... UTERINE, ADNEXA PROC FOR NON-OVARIAN/ADNEXAL MALIG 

W CC.

1.5238 4.6 5.7 

355 ........... 13 SURG ...... UTERINE, ADNEXA PROC FOR NON-OVARIAN/ADNEXAL MALIG 

W/O CC.

.8834 2.8 3.1 

356 ........... 13 SURG ...... FEMALE REPRODUCTIVE SYSTEM RECONSTRUCTIVE PROCEDURES..7429 1.7 1.9 

357 ........... 13 SURG ...... UTERINE & ADNEXA PROC FOR OVARIAN OR ADNEXAL MALIGNANCY.2.2212 6.5 8.1 

358 ........... 13 SURG ...... UTERINE & ADNEXA PROC FOR NON-MALIGNANCY W CC ........ 1.1428 3.2 4.0 

23588 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

TABLE 5.—LIST OF DIAGNOSIS-RELATED GROUPS (DRGS, RELATIVE WEIGHTING FACTORS, AND GEOMETRIC AND

ARITHMETIC MEAN LENGTH OF STAY (LOS)—Continued 

DRG MDC TYPE DRG Title Weights Mean 

LOS 

Mean 

LOS 

359 ........... 13 SURG ...... UTERINE & ADNEXA PROC FOR NON-MALIGNANCY W/O CC .... .7936 2.2 2.4 

360 ........... 13 SURG ...... VAGINA, CERVIX & VULVA PROCEDURES ..................................... .8559 2.0 2.6 

361 ........... 13 SURG ...... LAPAROSCOPY & INCISIONAL TUBAL INTERRUPTION ................ 1.0844 2.2 3.0 

362 ........... 13 SURG * .... ENDOSCOPIC TUBAL INTERRUPTION ............................................ .3053 1.4 1.4 

363 ........... 13 SURG ...... D&C, CONIZATION & RADIO-IMPLANT, FOR MALIGNANCY ......... .9742 2.7 3.8 

364 ........... 13 SURG ...... D&C, CONIZATION EXCEPT FOR MALIGNANCY ............................ .8710 3.0 4.2 

365 ........... 13 SURG ...... OTHER FEMALE REPRODUCTIVE SYSTEM O.R. PROCEDURES 2.0317 5.3 7.7 

366 ........... 13 MED ......... MALIGNANCY, FEMALE REPRODUCTIVE SYSTEM W CC ............ 1.2296 4.8 6.5 

367 ........... 13 MED ......... MALIGNANCY, FEMALE REPRODUCTIVE SYSTEM W/O CC ........ .5734 2.3 3.0 

368 ........... 13 MED ......... INFECTIONS, FEMALE REPRODUCTIVE SYSTEM ......................... 1.1668 5.2 6.7 

369 ........... 13 MED ......... MENSTRUAL & OTHER FEMALE REPRODUCTIVE SYSTEM DISORDERS..6297 2.4 3.2 

370 ........... 14 SURG ...... CESAREAN SECTION W CC ............................................................. .8956 4.1 5.2 

371 ........... 14 SURG ...... CESAREAN SECTION W/O CC ......................................................... .6037 3.1 3.4 

372 ........... 14 MED ......... VAGINAL DELIVERY W COMPLICATING DIAGNOSES ................... .5047 2.6 3.2 

373 ........... 14 MED ......... VAGINAL DELIVERY W/O COMPLICATING DIAGNOSES ............... .3562 2.0 2.2 

374 ........... 14 SURG ...... VAGINAL DELIVERY W STERILIZATION &/OR D&C ....................... .6762 2.4 2.7 

375 ........... 14 SURG * .... VAGINAL DELIVERY W O.R. PROC EXCEPT STERIL &/OR D&C .. .5829 4.4 4.4 

376 ........... 14 MED ......... POSTPARTUM & POST ABORTION DIAGNOSES W/O O.R. PROCEDURE..5215 2.6 3.4 

377 ........... 14 SURG ...... POSTPARTUM & POST ABORTION DIAGNOSES W O.R. PROCEDURE.1.6547 2.9 4.5 

378 ........... 14 MED ......... ECTOPIC PREGNANCY ..................................................................... .7508 1.9 2.3 

379 ........... 14 MED ......... THREATENED ABORTION ................................................................. .3590 2.0 2.8 

380 ........... 14 MED ......... ABORTION W/O D&C ......................................................................... .3913 1.6 2.1 

381 ........... 14 SURG ...... ABORTION W D&C, ASPIRATION CURETTAGE OR 

HYSTEROTOMY.

.6059 1.7 2.3 

382 ........... 14 MED ......... FALSE LABOR .................................................................................... .2071 1.3 1.4 

383 ........... 14 MED ......... OTHER ANTEPARTUM DIAGNOSES W MEDICAL COMPLICATIONS..5053 2.6 3.7 

384 ........... 14 MED ......... OTHER ANTEPARTUM DIAGNOSES W/O MEDICAL COMPLICATIONS..3187 1.8 2.6 

385 ........... 15 MED * ...... NEONATES, DIED OR TRANSFERRED TO ANOTHER ACUTE 

CARE FACILITY.

1.3909 1.8 1.8 

386 ........... 15 MED * ...... EXTREME IMMATURITY OR RESPIRATORY DISTRESS SYNDROME, NEONATE.4.5865 17.9 17.9 

387 ........... 15 MED * ...... PREMATURITY W MAJOR PROBLEMS ............................................ 3.1325 13.3 13.3 

388 ........... 15 MED * ...... PREMATURITY W/O MAJOR PROBLEMS ........................................ 1.8900 8.6 8.6 

389 ........... 15 MED * ...... FULL TERM NEONATE W MAJOR PROBLEMS ............................... 3.2177 4.7 4.7 

390 ........... 15 MED * ...... NEONATE W OTHER SIGNIFICANT PROBLEMS ............................ 1.1388 3.4 3.4 

391 ........... 15 MED * ...... NORMAL NEWBORN .......................................................................... .1542 3.1 3.1 

392 ........... 16 SURG ...... SPLENECTOMY AGE >17 .................................................................. 3.0278 6.5 9.2 

393 ........... 16 SURG * .... SPLENECTOMY AGE 0–17 ................................................................ 1.3624 9.1 9.1 

394 ........... 16 SURG ...... OTHER O.R. PROCEDURES OF THE BLOOD AND BLOOD 

FORMING ORGANS.

1.9019 4.5 7.4 

395 ........... 16 MED ......... RED BLOOD CELL DISORDERS AGE >17 ....................................... .8303 3.2 4.3 

396 ........... 16 MED * ...... RED BLOOD CELL DISORDERS AGE 0–17 ..................................... 2.5374 4.1 4.1 

397 ........... 16 MED ......... COAGULATION DISORDERS ............................................................ 1.3113 3.8 5.2 

398 ........... 16 MED ......... RETICULOENDOTHELIAL & IMMUNITY DISORDERS W CC .......... 1.2212 4.5 5.8 

399 ........... 16 MED ......... RETICULOENDOTHELIAL & IMMUNITY DISORDERS W/O CC ...... .6665 2.7 3.3 

400 ........... 17 SURG ...... NO LONGER VALID ............................................................................ .0000 .0 .0 

401 ........... 17 SURG ...... LYMPHOMA & NON-ACUTE LEUKEMIA W OTHER O.R. PROC W 

CC.

2.9643 8.0 11.3 

402 ........... 17 SURG ...... LYMPHOMA & NON-ACUTE LEUKEMIA W OTHER O.R. PROC W/ 

O CC.

1.1793 2.8 4.1 

403 ........... 17 MED ......... LYMPHOMA & NON-ACUTE LEUKEMIA W CC ................................ 1.8406 5.8 8.1 

404 ........... 17 MED ......... LYMPHOMA & NON-ACUTE LEUKEMIA W/O CC ............................ .9244 3.0 4.2 

405 ........... 17 MED * ...... ACUTE LEUKEMIA W/O MAJOR O.R. PROCEDURE AGE 0–17 ..... 1.9316 4.9 4.9 

406 ........... 17 SURG ...... MYELOPROLIF DISORD OR POORLY DIFF NEOPL W MAJ 

O.R.PROC W CC.

2.7989 7.0 9.9 

407 ........... 17 SURG ...... MYELOPROLIF DISORD OR POORLY DIFF NEOPL W MAJ 

O.R.PROC W/O CC.

1.2325 3.0 3.8 

408 ........... 17 SURG ...... MYELOPROLIF DISORD OR POORLY DIFF NEOPL W OTHER 

O.R.PROC.

2.2303 4.8 8.2 

409 ........... 17 MED ......... RADIOTHERAPY ................................................................................. 1.2066 4.3 5.8 

410 ........... 17 MED ......... CHEMOTHERAPY W/O ACUTE LEUKEMIA AS SECONDARY DIAGNOSIS.1.1022 3.0 3.8 

411 ........... 17 MED ......... HISTORY OF MALIGNANCY W/O ENDOSCOPY ............................. .3645 2.5 3.3 

412 ........... 17 MED ......... HISTORY OF MALIGNANCY W ENDOSCOPY ................................. .8442 1.8 2.8 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23589 

TABLE 5.—LIST OF DIAGNOSIS-RELATED GROUPS (DRGS, RELATIVE WEIGHTING FACTORS, AND GEOMETRIC AND

ARITHMETIC MEAN LENGTH OF STAY (LOS)—Continued 

DRG MDC TYPE DRG Title Weights Mean 

LOS 

Mean 

LOS 

413 ........... 17 MED ......... OTHER MYELOPROLIF DIS OR POORLY DIFF NEOPL DIAG W 

CC.

1.3035 5.0 6.8 

414 ........... 17 MED ......... OTHER MYELOPROLIF DIS OR POORLY DIFF NEOPL DIAG W/O 

CC.

.7784 3.0 4.0 

415 ........... 18 SURG ...... O.R. PROCEDURE FOR INFECTIOUS & PARASITIC DISEASES ... 3.9753 11.0 14.8 

416 ........... 18 MED ......... SEPTICEMIA AGE >17 ....................................................................... 1.6705 5.6 7.5 

417 ........... 18 MED ......... SEPTICEMIA AGE 0–17 ..................................................................... 1.2962 3.6 5.3 

418 ........... 18 MED ......... POSTOPERATIVE & POST-TRAUMATIC INFECTIONS ................... 1.1035 4.9 6.4 

419 ........... 18 MED ......... FEVER OF UNKNOWN ORIGIN AGE >17 W CC .............................. .8526 3.4 4.4 

420 ........... 18 MED ......... FEVER OF UNKNOWN ORIGIN AGE >17 W/O CC .......................... .6088 2.7 3.4 

421 ........... 18 MED ......... VIRAL ILLNESS AGE >17 ................................................................... .7680 3.1 4.1 

422 ........... 18 MED ......... VIRAL ILLNESS & FEVER OF UNKNOWN ORIGIN AGE 0–17 ........ .6185 2.6 3.7 

423 ........... 18 MED ......... OTHER INFECTIOUS & PARASITIC DISEASES DIAGNOSES ........ 1.9163 6.0 8.4 

424 ........... 19 SURG ...... O.R. PROCEDURE W PRINCIPAL DIAGNOSES OF MENTAL ILLNESS.2.2400 7.3 11.7 

425 ........... 19 MED ......... ACUTE ADJUSTMENT REACTION & PSYCHOSOCIAL DYSFUNCTION..6187 2.6 3.5 

426 ........... 19 MED ......... DEPRESSIVE NEUROSES ................................................................. .4655 3.0 4.1 

427 ........... 19 MED ......... NEUROSES EXCEPT DEPRESSIVE ................................................. .5159 3.2 4.7 

428 ........... 19 MED ......... DISORDERS OF PERSONALITY & IMPULSE CONTROL ................ .6944 4.6 7.2 

429 ........... 19 MED ......... ORGANIC DISTURBANCES & MENTAL RETARDATION ................. .7893 4.3 5.6 

430 ........... 19 MED ......... PSYCHOSES ....................................................................................... .6306 5.6 7.7 

431 ........... 19 MED ......... CHILDHOOD MENTAL DISORDERS ................................................. .5194 4.0 5.9 

432 ........... 19 MED ......... OTHER MENTAL DISORDER DIAGNOSES ...................................... .6322 2.9 4.3 

433 ........... 20 MED ......... ALCOHOL/DRUG ABUSE OR DEPENDENCE, LEFT AMA .............. .2774 2.2 3.0 

434 ........... 20 MED ......... NO LONGER VALID ............................................................................ .0000 .0 .0 

435 ........... 20 MED ......... NO LONGER VALID ............................................................................ .0000 .0 .0 

436 ........... 20 MED ......... NO LONGER VALID ............................................................................ .0000 .0 .0 

437 ........... 20 MED ......... NO LONGER VALID ............................................................................ .0000 .0 .0 

438 ........... 20 .................. NO LONGER VALID ............................................................................ .0000 .0 .0 

439 ........... 21 SURG ...... SKIN GRAFTS FOR INJURIES ........................................................... 1.9204 5.4 8.8 

440 ........... 21 SURG ...... WOUND DEBRIDEMENTS FOR INJURIES ....................................... 1.9346 5.9 9.2 

441 ........... 21 SURG ...... HAND PROCEDURES FOR INJURIES .............................................. .9334 2.3 3.4 

442 ........... 21 SURG ...... OTHER O.R. PROCEDURES FOR INJURIES W CC ........................ 2.5647 6.0 8.9 

443 ........... 21 SURG ...... OTHER O.R. PROCEDURES FOR INJURIES W/O CC .................... .9911 2.6 3.4 

444 ........... 21 MED ......... TRAUMATIC INJURY AGE >17 W CC ............................................... .7540 3.2 4.1 

445 ........... 21 MED ......... TRAUMATIC INJURY AGE >17 W/O CC ........................................... .5016 2.3 2.8 

446 ........... 21 MED * ...... TRAUMATIC INJURY AGE 0–17 ........................................................ .2995 2.4 2.4 

447 ........... 21 MED ......... ALLERGIC REACTIONS AGE >17 ..................................................... .5572 1.9 2.6 

448 ........... 21 MED * ...... ALLERGIC REACTIONS AGE 0–17 ................................................... .0985 2.9 2.9 

449 ........... 21 MED ......... POISONING & TOXIC EFFECTS OF DRUGS AGE >17 W CC ........ .8509 2.6 3.7 

450 ........... 21 MED ......... POISONING & TOXIC EFFECTS OF DRUGS AGE >17 W/O CC .... .4288 1.6 2.0 

451 ........... 21 MED * ...... POISONING & TOXIC EFFECTS OF DRUGS AGE 0–17 ................. .2658 2.1 2.1 

452 ........... 21 MED ......... COMPLICATIONS OF TREATMENT W CC ....................................... 1.0388 3.5 4.9 

453 ........... 21 MED ......... COMPLICATIONS OF TREATMENT W/O CC ................................... .5278 2.2 2.8 

454 ........... 21 MED ......... OTHER INJURY, POISONING & TOXIC EFFECT DIAG W CC ........ .8128 2.9 4.1 

455 ........... 21 MED ......... OTHER INJURY, POISONING & TOXIC EFFECT DIAG W/O CC .... .4700 1.7 2.2 

456 ........... 22 .................. NO LONGER VALID ............................................................................ .0000 .0 .0 

457 ........... 22 MED ......... NO LONGER VALID ............................................................................ .0000 .0 .0 

458 ........... 22 SURG ...... NO LONGER VALID ............................................................................ .0000 .0 .0 

459 ........... 22 SURG ...... NO LONGER VALID ............................................................................ .0000 .0 .0 

460 ........... 22 MED ......... NO LONGER VALID ............................................................................ .0000 .0 .0 

461 ........... 23 SURG ...... O.R. PROC W DIAGNOSES OF OTHER CONTACT W HEALTH 

SERVICES.

1.3957 3.0 5.1 

462 ........... 23 MED ......... REHABILITATION ................................................................................ .8496 8.8 10.7 

463 ........... 23 MED ......... SIGNS & SYMPTOMS W CC .............................................................. .6946 3.1 3.9 

464 ........... 23 MED ......... SIGNS & SYMPTOMS W/O CC .......................................................... .5057 2.4 2.9 

465 ........... 23 MED ......... AFTERCARE W HISTORY OF MALIGNANCY AS SECONDARY DIAGNOSIS..6015 2.4 3.6 

466 ........... 23 MED ......... AFTERCARE W/O HISTORY OF MALIGNANCY AS SECONDARY 

DIAGNOSIS.

.6922 2.7 4.7 

467 ........... 23 MED ......... OTHER FACTORS INFLUENCING HEALTH STATUS ...................... .4789 2.0 2.7 

468 ........... .................. EXTENSIVE O.R. PROCEDURE UNRELATED TO PRINCIPAL DIAGNOSIS.3.9877 9.7 13.2 

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.

3.1328 4.5 5.1 

472 ........... 22 SURG ...... NO LONGER VALID ............................................................................ .0000 .0 .0 

473 ........... 17 MED ......... ACUTE LEUKEMIA W/O MAJOR O.R. PROCEDURE AGE >17 ...... 3.4949 7.6 12.9 

23590 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

TABLE 5.—LIST OF DIAGNOSIS-RELATED GROUPS (DRGS, RELATIVE WEIGHTING FACTORS, AND GEOMETRIC AND

ARITHMETIC MEAN LENGTH OF STAY (LOS)—Continued 

DRG MDC TYPE DRG Title Weights Mean 

LOS 

Mean 

LOS 

474 ........... 04 SURG ...... NO LONGER VALID ............................................................................ .0000 .0 .0 

475 ........... 04 MED ......... RESPIRATORY SYSTEM DIAGNOSIS WITH VENTILATOR SUPPORT.3.5930 8.1 11.3 

476 ........... SURG ...... PROSTATIC O.R. PROCEDURE UNRELATED TO PRINCIPAL DIAGNOSIS.2.1792 7.4 10.5 

477 ........... SURG ...... NON-EXTENSIVE O.R. PROCEDURE UNRELATED TO PRINCIPAL DIAGNOSIS.2.0539 5.8 8.7 

478 ........... 05 SURG ...... OTHER VASCULAR PROCEDURES W CC ...................................... 2.4118 4.7 7.2 

479 ........... 05 SURG ...... OTHER VASCULAR PROCEDURES W/O CC ................................... 1.4433 2.1 2.8 

480 ........... PRE SURG ...... LIVER TRANSPLANT AND/OR INTESTINAL TRANSPLANT ............ 8.9426 13.7 17.9 

481 ........... PRE SURG ...... BONE MARROW TRANSPLANT ........................................................ 6.2341 18.3 21.8 

482 ........... PRE SURG ...... TRACHEOSTOMY FOR FACE, MOUTH & NECK DIAGNOSES ...... 3.3281 9.7 12.1 

483 ........... PRE SURG ...... NO LONGER VALID ............................................................................ .0000 .0 .0 

484 ........... 24 SURG ...... CRANIOTOMY FOR MULTIPLE SIGNIFICANT TRAUMA ................. 5.1050 9.3 12.8 

485 ........... 24 SURG ...... LIMB REATTACHMENT, HIP AND FEMUR PROC FOR MULTIPLE 

SIGNIFICANT TRA.

3.4619 8.3 10.2 

486 ........... 24 SURG ...... OTHER O.R. PROCEDURES FOR MULTIPLE SIGNIFICANT 

TRAUMA.

4.7225 8.5 12.4 

487 ........... 24 MED ......... OTHER MULTIPLE SIGNIFICANT TRAUMA ..................................... 1.9309 5.3 7.3 

488 ........... 25 SURG ...... HIV W EXTENSIVE O.R. PROCEDURE ............................................ 4.4100 11.7 16.4 

489 ........... 25 MED ......... HIV W MAJOR RELATED CONDITION .............................................. 1.8294 6.0 8.5 

490 ........... 25 MED ......... HIV W OR W/O OTHER RELATED CONDITION ............................... 1.0638 3.9 5.4 

491 ........... 08 SURG ...... MAJOR JOINT & LIMB REATTACHMENT PROCEDURES OF 

UPPER EXTREMITY.

1.6734 2.6 3.1 

492 ........... 17 MED ......... CHEMOTHERAPY W ACUTE LEUKEMIA OR W USE OF HI DOSE 

CHEMOAGENT.

3.5856 8.8 13.6 

493 ........... 07 SURG ...... LAPAROSCOPIC CHOLECYSTECTOMY W/O C.D.E. W CC ........... 1.8413 4.6 6.1 

494 ........... 07 SURG ...... LAPAROSCOPIC CHOLECYSTECTOMY W/O C.D.E. W/O CC ....... 1.0275 2.1 2.7 

495 ........... PRE SURG ...... LUNG TRANSPLANT .......................................................................... 8.5766 13.9 17.3 

496 ........... 08 SURG ...... COMBINED ANTERIOR/POSTERIOR SPINAL FUSION ................... 6.2260 6.6 9.0 

497 ........... 08 SURG ...... SPINAL FUSION EXCEPT CERVICAL W CC .................................... 3.6385 5.0 5.9 

498 ........... 08 SURG ...... SPINAL FUSION EXCEPT CERVICAL W/O CC ................................ 2.7792 3.4 3.8 

499 ........... 08 SURG ...... BACK & NECK PROCEDURES EXCEPT SPINAL FUSION W CC ... 1.3903 3.1 4.3 

500 ........... 08 SURG ...... BACK & NECK PROCEDURES EXCEPT SPINAL FUSION W/O CC .9033 1.8 2.2 

501 ........... 08 SURG ...... KNEE PROCEDURES W PDX OF INFECTION W CC ...................... 2.6488 8.5 10.4 

502 ........... 08 SURG ...... KNEE PROCEDURES W PDX OF INFECTION W/O CC .................. 1.4419 4.9 5.8 

503 ........... 08 SURG ...... KNEE PROCEDURES W/O PDX OF INFECTION ............................. 1.2014 2.9 3.8 

504 ........... 22 SURG ...... EXTEN. BURNS OR FULL THICKNESS BURN W/MV 96+HRS W/ 

SKIN GFT.

11.6990 21.6 27.3 

505 ........... 22 MED ......... EXTEN. BURNS OR FULL THICKNESS BURN W/MV 96+HRS W/O 

SKIN GFT.

2.3035 2.4 4.7 

506 ........... 22 SURG ...... FULL THICKNESS BURN W SKIN GRAFT OR INHAL INJ W CC 

OR SIG TRAUMA.

4.1098 11.2 15.9 

507 ........... 22 SURG ...... FULL THICKNESS BURN W SKIN GRFT OR INHAL INJ W/O CC 

OR SIG TRAUMA.

1.7419 5.9 8.5 

508 ........... 22 MED ......... FULL THICKNESS BURN W/O SKIN GRFT OR INHAL INJ W CC 

OR SIG TRAUMA.

1.2672 5.1 7.3 

509 ........... 22 MED ......... FULL THICKNESS BURN W/O SKIN GRFT OR INH INJ W/O CC 

OR SIG TRAUMA.

.8233 3.6 5.2 

510 ........... 22 MED ......... NON-EXTENSIVE BURNS W CC OR SIGNIFICANT TRAUMA ........ 1.1808 4.4 6.5 

511 ........... 22 MED ......... NON-EXTENSIVE BURNS W/O CC OR SIGNIFICANT TRAUMA .... .7452 2.7 4.1 

512 ........... PRE SURG ...... SIMULTANEOUS PANCREAS/KIDNEY TRANSPLANT .................... 5.3328 10.7 12.8 

513 ........... PRE SURG ...... PANCREAS TRANSPLANT ................................................................ 5.9670 8.9 10.0 

514 ........... 05 SURG ...... NO LONGER VALID ............................................................................ .0000 .0 .0 

515 ........... 05 SURG ...... CARDIAC DEFIBRILLATOR IMPLANT W/O CARDIAC CATH .......... 5.5196 2.6 4.3 

516 ........... 05 SURG ...... NO LONGER VALID ............................................................................ .0000 .0 .0 

517 ........... 05 SURG ...... PERC CARDIO PROC W NON-DRUG ELUTING STENT W/O AMI 2.0601 1.8 2.6 

518 ........... 05 SURG ...... PERC CARDIO PROC W/O CORONARY ARTERY STENT OR AMI 1.7772 2.3 3.5 

519 ........... 08 SURG ...... CERVICAL SPINAL FUSION W CC ................................................... 2.4826 3.0 4.8 

520 ........... 08 SURG ...... CERVICAL SPINAL FUSION W/O CC ................................................ 1.6774 1.6 2.0 

521 ........... 20 MED ......... ALCOHOL/DRUG ABUSE OR DEPENDENCE W CC ....................... .6935 4.2 5.6 

522 ........... 20 MED ......... ALC/DRUG ABUSE OR DEPEND W REHABILITATION THERAPY 

W/O CC.

.4767 7.7 9.6 

523 ........... 20 MED ......... ALC/DRUG ABUSE OR DEPEND W/O REHABILITATION THERAPY W/O CC..3785 3.2 3.9 

524 ........... 01 MED ......... TRANSIENT ISCHEMIA ...................................................................... .7274 2.6 3.2 

525 ........... 05 SURG ...... OTHER HEART ASSIST SYSTEM IMPLANT .................................... 11.5451 7.3 13.9 

526 ........... 05 SURG ...... NO LONGER VALID ............................................................................ .0000 .0 .0 

527 ........... 05 SURG ...... PERCUTNEOUS CARDIOVASULAR PROC W DRUG ELUTING 

STENT W/O AMI.

2.3161 1.6 2.2 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23591 

TABLE 5.—LIST OF DIAGNOSIS-RELATED GROUPS (DRGS, RELATIVE WEIGHTING FACTORS, AND GEOMETRIC AND

ARITHMETIC MEAN LENGTH OF STAY (LOS)—Continued 

DRG MDC TYPE DRG Title Weights Mean 

LOS 

Mean 

LOS 

528 ........... 01 SURG ...... INTRACRANIAL VASCULAR PROC W PDX HEMORRHAGE .......... 7.0396 13.8 17.2 

529 ........... 01 SURG ...... VENTRICULAR SHUNT PROCEDURES W CC ................................. 2.3118 5.3 8.3 

530 ........... 01 SURG ...... VENTRICULAR SHUNT PROCEDURES W/O CC ............................. 1.2020 2.4 3.1 

531 ........... 01 SURG ...... SPINAL PROCEDURES W CC ........................................................... 3.1221 6.5 9.6 

532 ........... 01 SURG ...... SPINAL PROCEDURES W/O CC ....................................................... 1.4172 2.8 3.7 

533 ........... 01 SURG ...... EXTRACRANIAL PROCEDURES W CC ............................................ 1.5728 2.4 3.7 

534 ........... 01 SURG ...... EXTRACRANIAL PROCEDURES W/O CC ........................................ 1.0198 1.5 1.8 

535 ........... 05 SURG ...... CARDIAC DEFIB IMPLANT W CARDIAC CATH W AMI/HF/SHOCK 8.0777 8.0 10.4 

536 ........... 05 SURG ...... CARDIAC DEFIB IMPLANT W CARDIAC CATH W/O AMI/HF/ 

SHOCK.

6.9110 5.9 7.7 

537 ........... 08 SURG ...... LOCAL EXCIS & REMOV OF INT FIX DEV EXCEPT HIP & FEMUR 

W CC.

1.8333 4.8 6.9 

538 ........... 08 SURG ...... LOCAL EXCIS & REMOV OF INT FIX DEV EXCEPT HIP & FEMUR 

W/O CC.

.9815 2.1 2.8 

539 ........... 17 SURG ...... LYMPHOMA & LEUKEMIA W MAJOR OR PROCEDURE W CC ..... 3.2371 7.0 10.8 

540 ........... 17 SURG ...... LYMPHOMA & LEUKEMIA W MAJOR OR PROCEDURE W/O CC .. 1.1892 2.6 3.6 

541 ........... PRE SURG ...... ECMO OR TRACH W MV 96+HRS OR PDX EXC FACE, MTH, 

FACE&NECK DX W/MAJ OR.

19.6693 38.0 45.4 

542 ........... PRE SURG ...... TRACH W MV 96+HRS OR PDX EXC FACE, MTH, FACE&NECK 

DX W/O MJ OR.

12.7797 29.0 34.9 

543 ........... 01 SURG ...... CRANIOTOMY W/IMPLANT OF CHEMO AGENT OR ACUTE 

COMPLX CNS PDX.

4.4062 8.5 12.2 

544 ........... 08 SURG ...... MAJOR JOINT REPLACEMENT OR REATTACHMENT OF LOWER 

EXTREMITY.

1.9612 4.1 4.6 

545 ........... 08 SURG ...... REVISION OF HIP OR KNEE REPLACEMENT ................................. 2.4781 4.5 5.2 

546 ........... 08 SURG ...... SPINAL FUSION EXC CERV WITH PDX OF CURVATURE OF THE 

SPINE OR MALIG.

5.0779 7.2 9.1 

547 ........... 05 SURG ...... PERCUTANEOUS CARDIOVASCULAR PROC W AMI W CC .......... 2.8246 4.4 5.6 

548 ........... 05 SURG ...... PERCUTANEOUS CARDIOVASCULAR PROC W AMI W/O CC ...... 2.0984 2.7 3.0 

549 ........... 05 SURG ...... PERCUTANEOUS CARDIOVASCULAR PROC W DRUG ELUTING 

STENT W AMI W CC.

3.2154 4.1 5.2 

550 ........... 05 SURG ...... PERCUTANEOUS CARDIOVASCULAR PROC W DRUG ELUTING 

STENT W AMI W/O CC.

2.5116 2.5 2.9 

*Medicare data has 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 means are presented for informational purposes only. 

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 

259.5 ........ Androgen insensitivity syndrome ................................................................................................... N 10 300, 301 

276.50 ...... Volume depletion, unspecified ....................................................................................................... Y 10 

15 

2 25 

296, 297, 298 

387,1 3891 

490 

276.51 ...... Dehydration .................................................................................................................................... Y 10 

15 

2 52 

296, 297, 298 

387,1 389 1

490 

276.52 ...... Hypovolemia .................................................................................................................................. Y 10 

15 

2 52 

296, 297, 298 

387,1 389 1

490 

278.02 ...... Overweight ..................................................................................................................................... N 10 296, 297, 298 

287.30 ...... Primary thrombocytopenia, unspecified ........................................................................................ Y 16 397 

287.31 ...... Immune thrombocytopenic purpura ............................................................................................... Y 16 397 

287.32 ...... Evans’ syndrome ........................................................................................................................... Y 16 397 

287.33 ...... Congenital and hereditary thrombocytopenic purpura .................................................................. Y 16 397 

287.39 ...... Other primary thrombocytopenia ................................................................................................... Y 16 397 

291.82 ...... Alcohol induced sleep disorders .................................................................................................... N 20 521, 522, 523 

292.85 ...... Drug induced sleep disorders ........................................................................................................ N 20 521, 522, 523 

327.00 ...... Organic insomnia, unspecified ...................................................................................................... N 19 432 

327.01 ...... Insomnia due to medical condition classified elsewhere .............................................................. N 19 432 

327.02 ...... Insomnia due to mental disorder ................................................................................................... N 19 432 

327.09 ...... Other organic insomnia ................................................................................................................. N 19 432 

327.10 ...... Organic hypersomnia, unspecified ................................................................................................ N 19 432 

327.11 ...... Idiopathic hypersomnia with long sleep time ................................................................................ N 19 432 

327.12 ...... Idiopathic hypersomnia without long sleep time ........................................................................... N 19 432 

23592 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

TABLE 6A.—NEW DIAGNOSIS CODES—Continued 

Diagnosis 

code Description CC MDC DRG 

327.13 ...... Recurrent hypersomnia ................................................................................................................. N 19 432 

327.14 ...... Hypersomnia due to medical condition ......................................................................................... N 19 432 

327.15 ...... Hypersomnia due to mental disorder ............................................................................................ N 19 432 

327.19 ...... Other organic hypersomnia ........................................................................................................... N 19 432 

327.20 ...... Organic sleep apnea, unspecified ................................................................................................. N PRE 

3 

482 

73, 74 

327.21 ...... Primary central sleep apnea .......................................................................................................... N PRE 

1 

482 

34, 35 

327.22 ...... High altitude periodic breathing ..................................................................................................... N PRE 

4 

482 

99, 100 

327.23 ...... Obstructive sleep apnea (adult) (pediatric) ................................................................................... N PRE 

3 

482 

73, 74 

327.24 ...... Idiopathic sleep related non-obstructive alveolar hypoventilation ................................................. N PRE 

3 

482 

73, 74 

327.26 ...... Sleep related hypoventilation/hypoxemia in conditions classifiable elsewhere ............................ N PRE 

3 

482 

73, 74 

327.27 ...... Central sleep apnea in conditions classified elsewhere ............................................................... N PRE 

1 

482 

34, 35 

327.29 ...... Other organic sleep apnea ............................................................................................................ N PRE 

3 

482 

73, 74 

362.03 ...... Nonproliferative diabetic retinopathy NOS .................................................................................... N 2 46, 47, 48 

362.04 ...... Mild nonproliferative diabetic retinopathy ...................................................................................... N 2 46, 47, 48 

362.05 ...... Moderate nonproliferative diabetic retinopathy ............................................................................. N 2 46, 47, 48 

362.06 ...... Severe nonproliferative diabetic retinopathy ................................................................................. N 2 46, 47, 48 

362.07 ...... Diabetic macular edema ................................................................................................................ N 2 46, 47, 48 

426.82 ...... Long QT syndrome ........................................................................................................................ N 5 138, 139 

443.82 ...... Erythromelalgia .............................................................................................................................. N 5 130, 131 

525.40 ...... Complete edentulism, unspecified ................................................................................................. N PRE 

3 

482 

185, 186, 187 

525.41 ...... Complete edentulism, class I ........................................................................................................ N PRE 

3 

482 

185, 186, 187 

525.42 ...... Complete edentulism, class II ....................................................................................................... N PRE 

3 

482 

185, 186, 187 

525.43 ...... Complete edentulism, class III ...................................................................................................... N PRE 

3 

482 

185, 186, 187 

525.44 ...... Complete edentulism, class IV ...................................................................................................... N PRE 

3 

482 

185, 186, 187 

525.50 ...... Partial edentulism, unspecified ...................................................................................................... N PRE 

3 

482 

185, 186, 187 

525.51 ...... Partial edentulism, class I .............................................................................................................. N PRE 

3 

482 

185, 186, 187 

525.52 ...... Partial edentulism, class II ............................................................................................................. N PRE 

3 

482 

185, 186, 187 

525.53 ...... Partial edentulism, class III ............................................................................................................ N PRE 

3 

482 

185, 186, 187 

525.54 ...... Partial edentulism, class IV ........................................................................................................... N PRE 

3 

482 

185, 186, 187 

567.21 ...... Peritonitis (acute) generalized ....................................................................................................... Y 6 

15 

188, 189, 190 

387,1 389 1

567.22 ...... Peritoneal abscess ........................................................................................................................ Y 6 

15 

188, 189, 190 

387,1 389 1

567.23 ...... Spontaneous bacterial peritonitis .................................................................................................. Y 6 

15 

188, 189, 190 

387,1 389 1

567.29 ...... Other suppurative peritonitis .......................................................................................................... Y 6 

15 

188, 189, 190 

387,1 389 1

567.38 ...... Other retroperitoneal abscess ....................................................................................................... Y 6 

15 

188, 189, 190 

387,1 389 1

567.39 ...... Other retroperitoneal infections ..................................................................................................... Y 6 

15 

188, 189, 190 

387,1 389 1

567.81 ...... Choleperitonitis .............................................................................................................................. Y 6 

15 

188, 189, 190 

387,1 389 1

567.82 ...... Sclerosing mesenteritis .................................................................................................................. Y 6 

15 

188, 189, 190 

387,1 389 1

567.89 ...... Other specified peritonitis .............................................................................................................. Y 6 

15 

188, 189, 190 

387,1 389 1

585.1 ........ Chronic kidney disease, Stage I .................................................................................................... Y PRE 

11 

512, 513 

315, 316 

585.2 ........ Chronic kidney disease, Stage II (mild) ........................................................................................ Y PRE 

11 

512, 513 

315, 316 

585.3 ........ Chronic kidney disease, Stage III (moderate) ............................................................................... Y PRE 

11 

512, 513 

315, 316 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23593 

TABLE 6A.—NEW DIAGNOSIS CODES—Continued 

Diagnosis 

code Description CC MDC DRG 

585.4 ........ Chronic kidney disease, Stage IV (severe) ................................................................................... Y PRE 

11 

512, 513 

315, 316 

585.5 ........ Chronic kidney disease, Stage V .................................................................................................. Y PRE 

11 

512, 513 

315, 316 

585.6 ........ End stage renal disease ................................................................................................................ Y PRE 

11 

512, 513 

315, 316 

585.9 ........ Chronic kidney disease, unspecified ............................................................................................. Y PRE 

11 

512, 513 

315, 316 

599.60 ...... Urinary obstruction, unspecified .................................................................................................... Y 

11 

15 331, 332, 333 

387,1 389 1

599.69 ...... Urinary obstruction, not elsewhere classified ................................................................................ Y 11 

15 

331, 332, 333 

387,1 389 1

651.70 ...... Multiple gestation following (elective) fetal reduction, unspecified as to episode of care or not 

applicable.

N 14 469 

651.71 ...... Multiple gestation following (elective) fetal reduction, delivered, with or without mention of 

antepartum condition.

N 14 370, 371, 372, 

373, 374, 375 

651.73 ...... Multiple gestation following (elective) fetal reduction, antepartum condition or complication ...... N 14 383, 384 

760.77 ...... Anticonvulsants .............................................................................................................................. N 15 390 

760.78 ...... Antimetabolic agents ..................................................................................................................... N 15 390 

763.84 ...... Meconium passage during delivery ............................................................................................... N 15 390 

770.10 ...... Fetal and newborn aspiration, unspecified .................................................................................... N 15 387,3 389 3

770.11 ...... Meconium aspiration without respiratory symptoms ..................................................................... N 15 387,3 389 3

770.12 ...... Meconium aspiration with respiratory symptoms .......................................................................... Y 15 387,3 389 3

770.17 ...... Other fetal and newborn aspiration without respiratory symptoms ............................................... N 15 387,3 389 3

770.18 ...... Other fetal and newborn aspiration with respiratory symptoms .................................................... Y 15 387,3 389 3

779.84 ...... Meconium staining ......................................................................................................................... N 15 390 

780.95 ...... Other excessive crying .................................................................................................................. N 23 463, 464 

799.01 ...... Asphyxia ........................................................................................................................................ Y 4 101, 102 

799.02 ...... Hypoxemia ..................................................................................................................................... Y 4 101, 102 

996.40 ...... Unspecified mechanical complication of internal orthopedic device, implant, and graft .............. Y 8 249 

996.41 ...... Mechanical loosening of prosthetic joint ....................................................................................... Y 8 249 

996.42 ...... Dislocation of prosthetic joint ......................................................................................................... Y 8 249 

996.43 ...... Prosthetic joint implant failure ....................................................................................................... Y 8 249 

996.44 ...... Peri-prosthetic fracture around prosthetic joint ............................................................................. Y 8 249 

996.45 ...... Peri-prosthetic osteolysis ............................................................................................................... Y 8 249 

996.46 ...... Articular bearing surface wear of prosthetic joint .......................................................................... Y 8 249 

996.47 ...... Other mechanical complication of prosthetic joint implant ............................................................ Y 8 249 

996.49 ...... Other mechanical complication of other internal orthopedic device, implant, and graft ............... Y 8 249 

V12.42 ..... Person history, Infections of the central nervous system ............................................................. N 23 467 

V12.60 ..... Person history, Unspecified disease of respiratory system .......................................................... N 23 467 

V12.61 ..... Person history, Pneumonia (recurrent) ......................................................................................... N 23 467 

V12.69 ..... Person history, Other diseases of respiratory system .................................................................. N 23 467 

V13.02 ..... Person history, Urinary (tract) infection ......................................................................................... N 23 467 

V13.03 ..... Person history, Nephrotic syndrome ............................................................................................. N 23 467 

V15.88 ..... History of fall .................................................................................................................................. N 23 467 

V17.81 ..... Family history, Osteoporosis ......................................................................................................... N 23 467 

V17.89 ..... Family history, Other musculoskeletal diseases ........................................................................... N 23 467 

V18.9 ....... Family history, Genetic disease carrier ......................................................................................... N 23 467 

V26.31 ..... Testing for genetic disease carrier status ..................................................................................... N 23 467 

V26.32 ..... Other genetic testing ..................................................................................................................... N 23 467 

V26.33 ..... Genetic counseling ........................................................................................................................ N 23 467 

V46.13 ..... Encounter for weaning from respirator [ventilator] ........................................................................ Y 23 467 

V46.14 ..... Mechanical complication of respirator [ventilator] ......................................................................... Y 23 467 

V49.84 ..... Bed confinement status ................................................................................................................. N 23 467 

V59.70 ..... Egg (oocyte) (ovum) donor, unspecified ....................................................................................... N 23 467 

V59.71 ..... Egg (oocyte) (ovum) donor, under age 35,anonymous recipient ................................................. N 23 467

V59.72 ..... Egg (oocyte) (ovum) donor, under age 35, designated recipient ................................................. N 23 467 

V59.73 ..... Egg (oocyte) (ovum) donor, age 35 and over,anonymous recipient ............................................ N 23 467 

V59.74 ..... Egg (oocyte) (ovum) donor, age 35 and over, designated recipient ............................................ N 23 467

V62.84 ..... Suicidal ideation ............................................................................................................................. N 19 425 

V64.00 ..... Vaccination not carried out, unspecified reason ........................................................................... N 23 467 

V64.01 ..... Vaccination not carried out because of acute illness .................................................................... N 23 467 

V64.02 ..... Vaccination not carried out because of chronic illness or condition ............................................. N 23 467 

V64.03 ..... Vaccination not carried out because of immune compromised state ........................................... N 23 467 

V64.04 ..... Vaccination not carried out because of allergy to vaccine or component .................................... N 23 467 

V64.05 ..... Vaccination not carried out because of caregiver refusal ............................................................. N 23 467 

V64.06 ..... Vaccination not carried out because of patient refusal ................................................................. N 23 467 

V64.07 ..... Vaccination not carried out for religious reasons .......................................................................... N 23 467 

V64.08 ..... Vaccination not carried out because patient had disease being vaccinated against ................... N 23 467 

V64.09 ..... Vaccination not carried out for other reason ................................................................................. N 23 467 

V69.5 ....... Behavioral insomnia of childhood .................................................................................................. N 23 467 

23594 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

TABLE 6A.—NEW DIAGNOSIS CODES—Continued 

Diagnosis 

code Description CC MDC DRG 

V72.86 ..... Encounter for blood typing ............................................................................................................ N 23 467 

V85.0 ....... Body Mass Index less than 19, adult ............................................................................................ N 23 467 

V85.1 ....... Body Mass Index between 19–24, adult ....................................................................................... N 23 467 

V85.21 ..... Body Mass Index 25.0–25.9, adult ................................................................................................ N 23 467 

V85.22 ..... Body Mass Index 26.0–26.9, adult ................................................................................................ N 23 467 

V85.23 ..... Body Mass Index 27.0–27.9, adult ................................................................................................ N 23 467 

V85.24 ..... Body Mass Index 28.0–28.9, adult ................................................................................................ N 23 467 

V85.25 ..... Body Mass Index 29.0–29.9, adult ................................................................................................ N 23 467 

V85.30 ..... Body Mass Index 30.0–30.9, adult ................................................................................................ N 23 467 

V85.31 ..... Body Mass Index 31.0–31.9, adult ................................................................................................ N 23 467 

V85.32 ..... Body Mass Index 32.0–32.9, adult ................................................................................................ N 23 467 

V85.33 ..... Body Mass Index 33.0–33.9, adult ................................................................................................ N 23 467 

V85.34 ..... Body Mass Index 34.0–34.9, adult ................................................................................................ N 23 467 

V85.35 ..... Body Mass Index 35.0–35.9, adult ................................................................................................ N 23 467 

V85.36 ..... Body Mass Index 36.0–36.9, adult ................................................................................................ N 23 467 

V85.37 ..... Body Mass Index 37.0–37.9, adult ................................................................................................ N 23 467 

V85.38 ..... Body Mass Index 38.0–38.9, adult ................................................................................................ N 23 467 

V85.39 ..... Body Mass Index 39.0–39.9, adult ................................................................................................ N 23 467 

V85.4 ....... Body Mass Index 40 and over, adult ............................................................................................ N 10 296, 297, 298 

1Secondary diagnosis of major problem in DRGs 387 and 389. 

2Principal diagnosis of significant HIV-related condition. 

3Principal or secondary diagnosis of major problem. 

TABLE 6B.—NEW PROCEDURE CODES

Procedure 

code Description OR MDC DRG 

00.40 ........ Procedure on single vessel ........................................................................................................... N 

00.41 ........ Procedure on two vessels ............................................................................................................. N 

00.42 ........ Procedure on three vessels ........................................................................................................... N 

00.43 ........ Procedure on four or more vessels ............................................................................................... N 

00.45 ........ Insertion of one vascular stent ...................................................................................................... N 

00.46 ........ Insertion of two vascular stents ..................................................................................................... N 

00.47 ........ Insertion of three vascular stents .................................................................................................. N 

00.48 ........ Insertion of four or more vascular stents ...................................................................................... N 

00.70 ........ Revision of hip replacement, both acetabular and femoral components ...................................... Y 8 

10 

21 

24 

471, 545 

292, 293 

442, 443 

485 

00.71 ........ Revision of hip replacement, acetabular component .................................................................... Y 8 

10 

21 2 

4 

471, 545 

292, 293 

442, 443 

485 

00.72 ........ Revision of hip replacement, femoral component ......................................................................... Y 8 

10 

21 

24 

471, 545 

292, 293 

442, 443 

485 

00.73 ........ Revision of hip replacement, acetabular liner and/or femoral head only ..................................... Y 8 

10 

21 

24 

471, 545 

292, 293 

442, 443 

485 

00.80 ........ Revision of knee replacement, total (all components) .................................................................. Y 8 

21 

24 

471, 545 

442, 443 

486 

00.81 ........ Revision of knee replacement, tibial component .......................................................................... Y 8 

21 

24 

471, 545 

442, 443 

486 

00.82 ........ Revision of knee replacement, femoral component ...................................................................... Y 8 

21 

24 

471, 545 

442, 443 

486 

00.83 ........ Revision of knee replacement, patellar component ...................................................................... Y 8 

21 

24 

471, 545 

442, 443 

486 

00.84 ........ Revision of total knee replacement, tibial insert (liner) ................................................................. Y 8 

21 

24 

471, 545 

442, 443 

486 

37.41 ........ Implantation of prosthetic cardiac support device around the heart ............................................. Y 5 110, 111 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23595 

TABLE 6B.—NEW PROCEDURE CODES—Continued 

Procedure 

code Description OR MDC DRG 

37.49 ........ Other repair of heart and pericardium ........................................................................................... Y 5 

21 

24 

110, 111 

442, 443 

486 

84.56 ........ Insertion of (cement) spacer .......................................................................................................... N 

84.57 ........ Removal of (cement) spacer ......................................................................................................... N 

86.97 ........ Insertion or replacement of single array rechargeable neurostimulator pulse generator ............. Y 1 7, 8 

86.98 ........ Insertion or replacement of dual array rechargeable neurostimulator pulse generator ................ Y 1 7, 8 

TABLE 6C.—INVALID DIAGNOSIS CODES

Diagnosis 

code Description CC MDC DRG 

276.5 ........ Volume depletion ........................................................................................................................... Y 10 

15 

2 25 

296, 297, 298 

387,1 3891 

490 

287.3 ........ Primary thrombocytopenia ............................................................................................................. Y 16 397 

567.2 ........ Other suppurative peritonitis .......................................................................................................... Y 6 

15 

188, 189, 190 

387,1 389 1

67.8 .......... Other specified peritonitis .............................................................................................................. Y 6 

15 

188, 189, 190 

387,1 389 1

585 ........... Chronic renal failure ...................................................................................................................... Y PRE 

11 

512, 513 

315,316 

599.6 ........ Urinary obstruction, unspecified .................................................................................................... Y 11 

15 

331, 332, 333 

387,1 389 1

770.1 ........ Meconium aspiration syndrome ..................................................................................................... Y 15 387,3 389 3

799.0 ........ Asphyxia ........................................................................................................................................ N 4 101, 102 

996.4 ........ Mechanical complication of internal orthopedic device, implant, and graft .................................. Y 8 249

V12.6 ....... Diseases of the respiratory system ............................................................................................... N 23 467 

V17.8 ....... Other musculoskeletal diseases .................................................................................................... N 23 467 

V26.3 ....... Genetic counseling and testing ..................................................................................................... N 23 467 

V64.0 ....... Vaccination not carried out because of contradiction ................................................................... N 23 467 

1Secondary Diagnosis of Major Problem 

2Principal diagnosis of Significant HIV Related Condition 

3Principal or Secondary Diagnosis of Major Problem 

TABLE 6D.—INVALID PROCEDURE CODES

Procedure 

Code Description OR MDC DRG 

36.02 ........ Single vessel percutaneous transluminal coronary angioplasty [PTCA] or coronary 

atherectomy with mention of thrombolytic agent.

Y 5 106, 516, 517, 

518, 526, 527 

36.05 ........ Multiple vessel percutaneous transluminal coronary angioplasty [PTCA] or coronary 

atherectomy performed during the same operation, with or without mention of thrombolytic 

agent.

Y 5 106, 516, 517, 

518, 526, 527 

37.4 .......... Repair of heart and pericardium .................................................................................................... Y 5 

21 

24 

110, 111 

442, 443 

486 

TABLE 6E.—REVISED DIAGNOSIS CODE TITLES

Diagnosis 

Code Description CC MDC DRG 

403.00 ...... Hypertensive kidney disease, malignant, without chronic kidney disease ................................... Y 11 331, 332, 333 

403.01 ...... Hypertensive kidney disease, malignant, with chronic kidney disease ........................................ Y 11 315, 316 

403.10 ...... Hypertensive kidney disease, benign, without chronic kidney disease ........................................ N 11 331, 332, 333 

403.11 ...... Hypertensive kidney disease, benign, with chronic kidney disease ............................................. Y 11 315, 316 

403.90 ...... Hypertensive kidney disease, unspecified, without chronic kidney disease ................................. N 11 331, 332, 333 

403.91 ...... Hypertensive kidney disease, unspecified, with chronic kidney disease ...................................... Y 11 315, 316 

404.00 ...... Hypertensive heart and kidney disease, malignant, without heart failure or chronic kidney disease.Y 5 134 

404.01 ...... Hypertensive heart and kidney disease, malignant, with heart failure ......................................... Y 5 

15 

115, 121, 124, 

127, 535 

1387, 389 1

404.02 ...... Hypertensive heart and kidney disease, malignant, with chronic kidney disease ........................ Y 11 315, 316 

23596 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

TABLE 6E.—REVISED DIAGNOSIS CODE TITLES—Continued 

Diagnosis 

Code Description CC MDC DRG 

404.03 ...... Hypertensive heart and kidney disease, malignant, with heart failure and chronic kidney disease.Y 5 

15 

115, 121, 124, 

127, 535 

387, 389 1

404.10 ...... Hypertensive heart and kidney disease, benign, without heart failure or chronic kidney disease N 5 134 

404.11 ...... Hypertensive heart and kidney disease, benign, with heart failure .............................................. Y 5 

15 

115, 121, 124, 

127, 535 

387, 389 1

404.12 ...... Hypertensive heart and kidney disease, benign, with chronic kidney disease ............................. Y 11 315, 316 

404.13 ...... Hypertensive heart and kidney disease, benign, with heart failure and chronic kidney disease Y 5 

15 

115, 121, 124, 

127, 535 

387, 3891 

404.90 ...... Hypertensive heart and kidney disease, unspecified, without heart failure or chronic kidney 

disease.

N 5 34 

404.91 ...... Hypertensive heart and kidney disease, unspecified, with heart failure ....................................... Y 5 

15 

115, 121, 124, 

127, 535 

387, 389 1

404.92 ...... Hypertensive heart and kidney disease, unspecified, with chronic kidney disease ..................... Y 11 315, 316 

404.93 ...... Hypertensive heart and kidney disease, unspecified, with heart failure and chronic kidney disease.Y 5 

15 

115, 121, 124, 

127, 535 

387, 389 1

728.87 ...... Muscle weakness (generalized) .................................................................................................... N 8 247 

780.51 ...... Insomnia with sleep apnea, unspecified ....................................................................................... N PRE 

3 

482 

73, 74 

780.52 ...... Insomnia, unspecified .................................................................................................................... N 19 432 

780.53 ...... Hypersomnia with sleep apnea, unspecified ................................................................................. N PRE 

3 

482 

73, 74 

780.54 ...... Hypersomnia, unspecified ............................................................................................................. N 19 432 

780.57 ...... Unspecified sleep apnea ............................................................................................................... N PRE 

3 

482 

73, 74 

1 Major problem in DRGs 387 and 389. 

TABLE 6F.—REVISED PROCEDURE CODE TITLES

Procedure 

Code Description OR MDC DRG 

36.01 ........ Percutaneous transluminal coronary angioplasty [PTCA] or coronary atherectomy .................... Y 5 106, 516, 517, 

518, 526, 527 

37.79 ........ Revision or relocation of cardiac device pocket ............................................................................ Y 1 

5 

9 

21 

24 

7, 8 

117 

269, 270 

442, 443 

486 

81.53 ........ Revision of hip replacement, not otherwise specified ................................................................... Y 8 

10 

21 

24 

471, 545 

292, 293 

442, 443 

485 

81.55 ........ Revision of knee replacement, not otherwise specified ................................................................ Y 8 

21 

24 

471, 545 

442, 443 

486 

TABLE 6G.—ADDITIONS TO THE CC 

EXCLUSIONS LIST

[CCs that are added to the list are in Table 

6G-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.] 

*185 

59960 

59969 

*1880 

59960 

59969 

*1881 

59960 

TABLE 6G.—ADDITIONS TO THE CC 

EXCLUSIONS LIST—Continued 

[CCs that are added to the list are in Table 

6G-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.] 

59969 

*1882 

59960 

59969 

*1883 

59960 

59969 

*1884 

TABLE 6G.—ADDITIONS TO THE CC 

EXCLUSIONS LIST—Continued 

[CCs that are added to the list are in Table 

6G-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.] 

59960 

59969 

*1885 

59960 

59969 

*1886 

59960 

59969 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23597 

TABLE 6G.—ADDITIONS TO THE CC 

EXCLUSIONS LIST—Continued 

[CCs that are added to the list are in Table 

6G-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.] 

*1887 

59960 

59969 

*1888 

59960 

59969 

*1889 

59960 

59969 

*1892 

59960 

59969 

*1893 

59960 

59969 

*1894 

59960 

59969 

*1898 

59960 

59969 

*1899 

59960 

59969 

*25040 

5851 

5852 

5853 

5854 

5855 

5856 

5859 

*25041 

5851 

5852 

5853 

5854 

5855 

5856 

5859 

*25042 

5851 

5852 

5853 

5854 

5855 

5856 

5859 

*25043 

5851 

5852 

5853 

5854 

5855 

5856 

5859 

*25080 

5851 

5852 

5853 

5854 

5855 

5856 

5859 

*25081 

5851 

TABLE 6G.—ADDITIONS TO THE CC 

EXCLUSIONS LIST—Continued 

[CCs that are added to the list are in Table 

6G-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.] 

5852 

5853 

5854 

5855 

5856 

5859 

*25082 

5851 

5852 

5853 

5854 

5855 

5856 

5859 

*25083 

5851 

5852 

5853 

5854 

5855 

5856 

5859 

*25090 

5851 

5852 

5853 

5854 

5855 

5856 

5859 

*25091 

5851 

5852 

5853 

5854 

5855 

5856 

5859 

*25092 

5851 

5852 

5853 

5854 

5855 

5856 

5859 

*25093 

5851 

5852 

5853 

5854 

5855 

5856 

5859 

*2595 

24200 

24201 

24210 

24211 

24220 

24221 

24230 

24231 

24240 

24241 

24280 

TABLE 6G.—ADDITIONS TO THE CC 

EXCLUSIONS LIST—Continued 

[CCs that are added to the list are in Table 

6G-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.] 

24281 

24290 

24291 

25001 

25002 

25003 

25011 

25012 

25013 

25021 

25022 

25023 

25031 

25032 

25033 

25041 

25042 

25043 

25051 

25052 

25053 

25061 

25062 

25063 

25071 

25072 

25073 

25081 

25082 

25083 

25091 

25092 

25093 

2510 

2513 

2521 

2532 

2535 

2541 

2550 

2553 

2554 

2555 

2556 

2580 

2581 

2588 

2589 

2592 

*27410 

5851 

5852 

5853 

5854 

5855 

5856 

5859 

*27411 

59960 

59969 

*27419 

5851 

5852 

5853 

5854 

5855 

23598 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

TABLE 6G.—ADDITIONS TO THE CC 

EXCLUSIONS LIST—Continued 

[CCs that are added to the list are in Table 

6G-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.] 

5856 

5859 

*2760 

27650 

27651 

27652 

*2761 

27650 

27651 

27652 

*2762 

27650 

27651 

27652 

*2763 

27650 

27651 

27652 

*2764 

27650 

27651 

27652 

*27650 

2760 

2761 

2762 

2763 

2764 

27650 

27651 

27652 

2766 

2767 

2769 

*27651 

2760 

2761 

2762 

2763 

2764 

27650 

27651 

27652 

2766 

2767 

2769 

*27652 

2760 

2761 

2762 

2763 

2764 

27650 

27651 

27652 

2766 

2767 

2769 

*2766 

27650 

27651 

27652 

*2767 

27650 

27651 

27652 

TABLE 6G.—ADDITIONS TO THE CC 

EXCLUSIONS LIST—Continued 

[CCs that are added to the list are in Table 

6G-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.] 

*2768 

27650 

27651 

27652 

*2769 

27650 

27651 

27652 

*2860 

28730 

28731 

28732 

28733 

28739 

*2861 

28730 

28731 

28732 

28733 

28739 

*2862 

28730 

28731 

28732 

28733 

28739 

*2863 

28730 

28731 

28732 

28733 

28739 

*2864 

28730 

28731 

28732 

28733 

28739 

*2865 

28730 

28731 

28732 

28733 

28739 

*2866 

28730 

28731 

28732 

28733 

28739 

*2867 

28730 

28731 

28732 

28733 

28739 

*2869 

28730 

28731 

28732 

28733 

28739 

*2870 

28730 

28731 

28732 

TABLE 6G.—ADDITIONS TO THE CC 

EXCLUSIONS LIST—Continued 

[CCs that are added to the list are in Table 

6G-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.] 

28733 

28739 

*2871 

28730 

28731 

28732 

28733 

28739 

*2872 

28730 

28731 

28732 

28733 

28739 

*28730 

2860 

2861 

2862 

2863 

2864 

2865 

2866 

2867 

2869 

2870 

2871 

2872 

28730 

28731 

28732 

28733 

28739 

2874 

2875 

2878 

2879 

*28731 

2860 

2861 

2862 

2863 

2864 

2865 

2866 

2867 

2869 

2870 

2871 

2872 

28730 

28731 

28732 

28733 

28739 

2874 

2875 

2878 

2879 

*28732 

2860 

2861 

2862 

2863 

2864 

2865 

2866 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23599 

TABLE 6G.—ADDITIONS TO THE CC 

EXCLUSIONS LIST—Continued 

[CCs that are added to the list are in Table 

6G-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.] 

2867 

2869 

2870 

2871 

2872 

28730 

28731 

28732 

28733 

28739 

2874 

2875 

2878 

2879 

*28733 

2860 

2861 

2862 

2863 

2864 

2865 

2866 

2867 

2869 

2870 

2871 

2872 

28730 

28731 

28732 

28733 

28739 

2874 

2875 

2878 

2879 

*28739 

2860 

2861 

2862 

2863 

2864 

2865 

2866 

2867 

2869 

2870 

2871 

2872 

28730 

28731 

28732 

28733 

28739 

2874 

2875 

2878 

2879 

*2874 

28730 

28731 

28732 

28733 

28739 

*2875 

28730 

TABLE 6G.—ADDITIONS TO THE CC 

EXCLUSIONS LIST—Continued 

[CCs that are added to the list are in Table 

6G-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.] 

28731 

28732 

28733 

28739 

*2878 

28730 

28731 

28732 

28733 

28739 

*2879 

28730 

28731 

28732 

28733 

28739 

*28981 

28730 

28731 

28732 

28733 

28739 

*28982 

28730 

28731 

28732 

28733 

28739 

*28989 

28730 

28731 

28732 

28733 

28739 

*2899 

28730 

28731 

28732 

28733 

28739 

*29182 

2910 

2911 

2912 

2913 

2914 

29181 

29189 

2919 

2920 

29211 

29212 

2922 

29281 

29282 

29283 

29284 

29289 

2929 

29381 

29382 

29383 

29384 

30300 

30301 

30302 

TABLE 6G.—ADDITIONS TO THE CC 

EXCLUSIONS LIST—Continued 

[CCs that are added to the list are in Table 

6G-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.] 

30390 

30391 

30392 

30400 

30401 

30402 

30410 

30411 

30412 

30420 

30421 

30422 

30440 

30441 

30442 

30450 

30451 

30452 

30460 

30461 

30462 

30470 

30471 

30472 

30480 

30481 

30482 

30490 

30491 

30492 

30500 

30501 

30502 

30530 

30531 

30532 

30540 

30541 

30542 

30550 

30551 

30552 

30560 

30561 

30562 

30570 

30571 

30572 

30590 

30591 

30592 

*29285 

2910 

2911 

2912 

2913 

2914 

29181 

29189 

2919 

2920 

29211 

29212 

2922 

29281 

29282 

23600 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

TABLE 6G.—ADDITIONS TO THE CC 

EXCLUSIONS LIST—Continued 

[CCs that are added to the list are in Table 

6G-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.] 

29283 

29284 

29289 

2929 

29381 

29382 

29383 

29384 

30300 

30301 

30302 

30390 

30391 

30392 

30400 

30401 

30402 

30410 

30411 

30412 

30420 

30421 

30422 

30440 

30441 

30442 

30450 

30451 

30452 

30460 

30461 

30462 

30470 

30471 

30472 

30480 

30481 

30482 

30490 

30491 

30492 

30500 

30501 

30502 

30530 

30531 

30532 

30540 

30541 

30542 

30550 

30551 

30552 

30560 

30561 

30562 

30570 

30571 

30572 

30590 

30591 

30592 

7105 

*34461 

59960 

59969 

TABLE 6G.—ADDITIONS TO THE CC 

EXCLUSIONS LIST—Continued 

[CCs that are added to the list are in Table 

6G-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.] 

*42682 

4260 

42612 

42613 

42653 

42654 

4266 

4267 

42681 

42689 

4269 

4270 

4271 

4272 

42731 

42732 

42741 

42742 

*51881 

79901 

79902 

*51882 

79901 

79902 

*51883 

79901 

79902 

*51884 

79901 

79902 

*5670 

56721 

56722 

56723 

56729 

56733 

56739 

56781 

56782 

56789 

*5671 

56721 

56722 

56723 

56729 

56733 

56739 

56781 

56782 

56789 

*56721 

5670 

5671 

56721 

56722 

56723 

56729 

56733 

56739 

56781 

56782 

56789 

5679 

*56722 

5670 

5671 

TABLE 6G.—ADDITIONS TO THE CC 

EXCLUSIONS LIST—Continued 

[CCs that are added to the list are in Table 

6G-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.] 

56721 

56722 

56723 

56729 

56733 

56739 

56781 

56782 

56789 

5679 

*56723 

5670 

5671 

56721 

56722 

56723 

56729 

56733 

56739 

56781 

56782 

56789 

5679 

*56729 

5670 

5671 

56721 

56722 

56723 

56729 

56733 

56739 

56781 

56782 

56789 

5679 

*56733 

5670 

5671 

56721 

56722 

56723 

56729 

56733 

56739 

56781 

56782 

56789 

5679 

*56739 

5670 

5671 

56721 

56722 

56723 

56729 

56733 

56739 

56781 

56782 

56789 

5679 

*56781 

5670 

5671 

56721 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23601 

TABLE 6G.—ADDITIONS TO THE CC 

EXCLUSIONS LIST—Continued 

[CCs that are added to the list are in Table 

6G-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.] 

56722 

56723 

56729 

56733 

56739 

56781 

56782 

56789 

5679 

*56782 

5670 

5671 

56721 

56722 

56723 

56729 

56733 

56739 

56781 

56782 

56789 

5679 

*56789 

5670 

5671 

56721 

56722 

56723 

56729 

56733 

56739 

56781 

56782 

56789 

5679 

*5679 

56721 

56722 

56723 

56729 

56733 

56739 

56781 

56782 

56789 

*56989 

56721 

56722 

56723 

56729 

56733 

56739 

56781 

56782 

56789 

*5699 

56721 

56722 

56723 

56729 

56733 

56739 

56781 

56782 

56789 

*5800 

TABLE 6G.—ADDITIONS TO THE CC 

EXCLUSIONS LIST—Continued 

[CCs that are added to the list are in Table 

6G-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.] 

5851 

5852 

5853 

5854 

5855 

5856 

5859 

*5804 

5851 

5852 

5853 

5854 

5855 

5856 

5859 

*58081 

5851 

5852 

5853 

5854 

5855 

5856 

5859 

*58089 

5851 

5852 

5853 

5854 

5855 

5856 

5859 

*5809 

5851 

5852 

5853 

5854 

5855 

5856 

5859 

*5810 

5851 

5852 

5853 

5854 

5855 

5856 

5859 

*5811 

5851 

5852 

5853 

5854 

5855 

5856 

5859 

*5812 

5851 

5852 

5853 

5854 

5855 

5856 

5859 

*5813 

5851 

5852 

TABLE 6G.—ADDITIONS TO THE CC 

EXCLUSIONS LIST—Continued 

[CCs that are added to the list are in Table 

6G-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.] 

5853 

5854 

5855 

5856 

5859 

*58181 

5851 

5852 

5853 

5854 

5855 

5856 

5859 

*58189 

5851 

5852 

5853 

5854 

5855 

5856 

5859 

*5819 

5851 

5852 

5853 

5854 

5855 

5856 

5859 

*5820 

5851 

5852 

5853 

5854 

5855 

5856 

5859 

*5821 

5851 

5852 

5853 

5854 

5855 

5856 

5859 

*5822 

5851 

5852 

5853 

5854 

5855 

5856 

5859 

*5824 

5851 

5852 

5853 

5854 

5855 

5856 

5859 

*58281 

5851 

5852 

5853 

5854 

23602 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

TABLE 6G.—ADDITIONS TO THE CC 

EXCLUSIONS LIST—Continued 

[CCs that are added to the list are in Table 

6G-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.] 

5855 

5856 

5859 

*58289 

5851 

5852 

5853 

5854 

5855 

5856 

5859 

*5829 

5851 

5852 

5853 

5854 

5855 

5856 

5859 

*5830 

5851 

5852 

5853 

5854 

5855 

5856 

5859 

*5831 

5851 

5852 

5853 

5854 

5855 

5856 

5859 

*5832 

5851 

5852 

5853 

5854 

5855 

5856 

5859 

*5834 

5851 

5852 

5853 

5854 

5855 

5856 

5859 

*5836 

5851 

5852 

5853 

5854 

5855 

5856 

5859 

*5837 

5851 

5852 

5853 

5854 

5855 

5856 

TABLE 6G.—ADDITIONS TO THE CC 

EXCLUSIONS LIST—Continued 

[CCs that are added to the list are in Table 

6G-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.] 

5859 

*58381 

5851 

5852 

5853 

5854 

5855 

5856 

5859 

*58389 

5851 

5852 

5853 

5854 

5855 

5856 

5859 

*5839 

5851 

5852 

5853 

5854 

5855 

5856 

5859 

*5845 

5851 

5852 

5853 

5854 

5855 

5856 

5859 

*5846 

5851 

5852 

5853 

5854 

5855 

5856 

5859 

*5847 

5851 

5852 

5853 

5854 

5855 

5856 

5859 

*5848 

5851 

5852 

5853 

5854 

5855 

5856 

5859 

*5849 

5851 

5852 

5853 

5854 

5855 

5856 

5859 

*5851 

TABLE 6G.—ADDITIONS TO THE CC 

EXCLUSIONS LIST—Continued 

[CCs that are added to the list are in Table 

6G-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.] 

5800 

5804 

58081 

58089 

5809 

5810 

5811 

5812 

5813 

58181 

58189 

5819 

5834 

5845 

5846 

5847 

5848 

5849 

5851 

5852 

5853 

5854 

5855 

5856 

5859 

59010 

59011 

5902 

5903 

59080 

59081 

5909 

591 

*5852 

5800 

5804 

58081 

58089 

5809 

5810 

5811 

5812 

5813 

58181 

58189 

5819 

5834 

5845 

5846 

5847 

5848 

5849 

5851 

5852 

5853 

5854 

5855 

5856 

5859 

59010 

59011 

5902 

5903 

59080 

59081 

5909 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23603 

TABLE 6G.—ADDITIONS TO THE CC 

EXCLUSIONS LIST—Continued 

[CCs that are added to the list are in Table 

6G-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.] 

591 

*5853 

5800 

5804 

58081 

58089 

5809 

5810 

5811 

5812 

5813 

58181 

58189 

5819 

5834 

5845 

5846 

5847 

5848 

5849 

5851 

5852 

5853 

5854 

5855 

5856 

5859 

59010 

59011 

5902 

5903 

59080 

59081 

5909 

591 

*5854 

5800 

5804 

58081 

58089 

5809 

5810 

5811 

5812 

5813 

58181 

58189 

5819 

5834 

5845 

5846 

5847 

5848 

5849 

5851 

5852 

5853 

5854 

5855 

5856 

5859 

59010 

59011 

5902 

5903 

59080 

TABLE 6G.—ADDITIONS TO THE CC 

EXCLUSIONS LIST—Continued 

[CCs that are added to the list are in Table 

6G-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.] 

59081 

5909 

591 

*5855 

5800 

5804 

58081 

58089 

5809 

5810 

5811 

5812 

5813 

58181 

58189 

5819 

5834 

5845 

5846 

5847 

5848 

5849 

5851 

5852 

5853 

5854 

5855 

5856 

5859 

59010 

59011 

5902 

5903 

59080 

59081 

5909 

591 

*5856 

5800 

5804 

58081 

58089 

5809 

5810 

5811 

5812 

5813 

58181 

58189 

5819 

5834 

5845 

5846 

5847 

5848 

5849 

5851 

5852 

5853 

5854 

5855 

5856 

5859 

59010 

59011 

5902 

TABLE 6G.—ADDITIONS TO THE CC 

EXCLUSIONS LIST—Continued 

[CCs that are added to the list are in Table 

6G-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.] 

5903 

59080 

59081 

5909 

591 

*5859 

5800 

5804 

58081 

58089 

5809 

5810 

5811 

5812 

5813 

58181 

58189 

5819 

5834 

5845 

5846 

5847 

5848 

5849 

5851 

5852 

5853 

5854 

5855 

5856 

5859 

59010 

59011 

5902 

5903 

59080 

59081 

5909 

591 

*586 

5851 

5852 

5853 

5854 

5855 

5856 

5859 

*587 

5851 

5852 

5853 

5854 

5855 

5856 

5859 

*5880 

5851 

5852 

5853 

5854 

5855 

5856 

5859 

*5881 

5851 

5852 

23604 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

TABLE 6G.—ADDITIONS TO THE CC 

EXCLUSIONS LIST—Continued 

[CCs that are added to the list are in Table 

6G-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.] 

5853 

5854 

5855 

5856 

5859 

*58881 

5851 

5852 

5853 

5854 

5855 

5856 

5859 

*58889 

5851 

5852 

5853 

5854 

5855 

5856 

5859 

*5889 

5851 

5852 

5853 

5854 

5855 

5856 

5859 

*5890 

5851 

5852 

5853 

5854 

5855 

5856 

5859 

*5891 

5851 

5852 

5853 

5854 

5855 

5856 

5859 

*5899 

5851 

5852 

5853 

5854 

5855 

5856 

5859 

*59000 

5851 

5852 

5853 

5854 

5855 

5856 

5859 

*59001 

5851 

5852 

5853 

5854 

TABLE 6G.—ADDITIONS TO THE CC 

EXCLUSIONS LIST—Continued 

[CCs that are added to the list are in Table 

6G-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.] 

5855 

5856 

5859 

*59010 

5851 

5852 

5853 

5854 

5855 

5856 

5859 

*59011 

5851 

5852 

5853 

5854 

5855 

5856 

5859 

*5902 

5851 

5852 

5853 

5854 

5855 

5856 

5859 

*5903 

5851 

5852 

5853 

5854 

5855 

5856 

5859 

*59080 

5851 

5852 

5853 

5854 

5855 

5856 

5859 

*59081 

5851 

5852 

5853 

5854 

5855 

5856 

5859 

*5909 

5851 

5852 

5853 

5854 

5855 

5856 

5859 

*591 

5851 

5852 

5853 

5854 

5855 

5856 

TABLE 6G.—ADDITIONS TO THE CC 

EXCLUSIONS LIST—Continued 

[CCs that are added to the list are in Table 

6G-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.] 

5859 

*5921 

59960 

59969 

*5929 

59960 

59969 

*5930 

5851 

5852 

5853 

5854 

5855 

5856 

5859 

*5931 

5851 

5852 

5853 

5854 

5855 

5856 

5859 

*5932 

5851 

5852 

5853 

5854 

5855 

5856 

5859 

*5933 

59960 

59969 

*5934 

59960 

59969 

*5935 

59960 

59969 

*59389 

5851 

5852 

5853 

5854 

5855 

5856 

5859 

59960 

59969 

*5939 

5851 

5852 

5853 

5854 

5855 

5856 

5859 

59960 

59969 

*5940 

59960 

59969 

*5941 

59960 

59969 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23605 

TABLE 6G.—ADDITIONS TO THE CC 

EXCLUSIONS LIST—Continued 

[CCs that are added to the list are in Table 

6G-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.] 

*5942 

59960 

59969 

*5948 

59960 

59969 

*5949 

59960 

59969 

*5950 

59960 

59969 

*5951 

59960 

59969 

*5952 

59960 

59969 

*5953 

59960 

59969 

*5954 

59960 

59969 

*59581 

59960 

59969 

*59582 

59960 

59969 

*59589 

59960 

59969 

*5959 

59960 

59969 

*5960 

59960 

59969 

*59651 

59960 

59969 

*59652 

59960 

59969 

*59653 

59960 

59969 

*59654 

59960 

59969 

*59655 

59960 

59969 

*59659 

59960 

59969 

*5968 

59960 

59969 

*5969 

59960 

59969 

*5970 

59960 

59969 

TABLE 6G.—ADDITIONS TO THE CC 

EXCLUSIONS LIST—Continued 

[CCs that are added to the list are in Table 

6G-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.] 

*59780 

59960 

59969 

*59781 

59960 

59969 

*59789 

59960 

59969 

*59800 

59960 

59969 

*59801 

59960 

59969 

*5981 

59960 

59969 

*5982 

59960 

59969 

*5988 

59960 

59969 

*5989 

59960 

59969 

*5990 

59960 

59969 

*5991 

59960 

59969 

*5992 

59960 

59969 

*5993 

59960 

59969 

*5994 

59960 

59969 

*5995 

59960 

59969 

*59960 

5921 

5935 

5950 

5951 

5952 

5954 

59581 

59582 

59589 

5959 

5970 

5981 

5982 

5990 

5994 

59960 

59969 

78820 

78829 

*59969 

TABLE 6G.—ADDITIONS TO THE CC 

EXCLUSIONS LIST—Continued 

[CCs that are added to the list are in Table 

6G-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.] 

5921 

5935 

5950 

5951 

5952 

5954 

59581 

59582 

59589 

5959 

5970 

5981 

5982 

5990 

5994 

59960 

59969 

78820 

78829 

*5997 

5851 

5852 

5853 

5854 

5855 

5856 

5859 

59960 

59969 

*59981 

5851 

5852 

5853 

5854 

5855 

5856 

5859 

59960 

59969 

*59982 

5851 

5852 

5853 

5854 

5855 

5856 

5859 

59960 

59969 

*59983 

5851 

5852 

5853 

5854 

5855 

5856 

5859 

59960 

59969 

*59984 

5851 

5852 

5853 

5854 

5855 

5856 

23606 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

TABLE 6G.—ADDITIONS TO THE CC 

EXCLUSIONS LIST—Continued 

[CCs that are added to the list are in Table 

6G-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.] 

5859 

59960 

59969 

*59989 

5851 

5852 

5853 

5854 

5855 

5856 

5859 

59960 

59969 

*5999 

5851 

5852 

5853 

5854 

5855 

5856 

5859 

59960 

59969 

*60000 

59960 

59969 

*60001 

59960 

59969 

*60010 

59960 

59969 

*60011 

59960 

59969 

*60020 

59960 

59969 

*60021 

59960 

59969 

*6003 

59960 

59969 

*60090 

59960 

59969 

*60091 

59960 

59969 

*6010 

59960 

59969 

*6011 

59960 

59969 

*6012 

59960 

59969 

*6013 

59960 

59969 

*6014 

59960 

59969 

*6018 

TABLE 6G.—ADDITIONS TO THE CC 

EXCLUSIONS LIST—Continued 

[CCs that are added to the list are in Table 

6G-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.] 

59960 

59969 

*6019 

59960 

59969 

*6020 

59960 

59969 

*6021 

59960 

59969 

*6022 

59960 

59969 

*6023 

59960 

59969 

*6028 

59960 

59969 

*6029 

59960 

59969 

*7530 

5851 

5852 

5853 

5854 

5855 

5856 

5859 

59960 

59969 

*75310 

5851 

5852 

5853 

5854 

5855 

5856 

5859 

59960 

59969 

*75311 

5851 

5852 

5853 

5854 

5855 

5856 

5859 

59960 

59969 

*75312 

5851 

5852 

5853 

5854 

5855 

5856 

5859 

59960 

59969 

*75313 

5851 

5852 

TABLE 6G.—ADDITIONS TO THE CC 

EXCLUSIONS LIST—Continued 

[CCs that are added to the list are in Table 

6G-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.] 

5853 

5854 

5855 

5856 

5859 

59960 

59969 

*75314 

5851 

5852 

5853 

5854 

5855 

5856 

5859 

59960 

59969 

*75315 

5851 

5852 

5853 

5854 

5855 

5856 

5859 

59960 

59969 

*75316 

5851 

5852 

5853 

5854 

5855 

5856 

5859 

59960 

59969 

*75317 

5851 

5852 

5853 

5854 

5855 

5856 

5859 

59960 

59969 

*75319 

5851 

5852 

5853 

5854 

5855 

5856 

5859 

59960 

59969 

*75320 

5851 

5852 

5853 

5854 

5855 

5856 

5859 

59960 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23607 

TABLE 6G.—ADDITIONS TO THE CC 

EXCLUSIONS LIST—Continued 

[CCs that are added to the list are in Table 

6G-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.] 

59969 

*75321 

5851 

5852 

5853 

5854 

5855 

5856 

5859 

59960 

59969 

*75322 

5851 

5852 

5853 

5854 

5855 

5856 

5859 

59960 

59969 

*75323 

5851 

5852 

5853 

5854 

5855 

5856 

5859 

59960 

59969 

*75329 

5851 

5852 

5853 

5854 

5855 

5856 

5859 

59960 

59969 

*7533 

5851 

5852 

5853 

5854 

5855 

5856 

5859 

59960 

59969 

*7534 

59960 

59969 

*7535 

59960 

59969 

*7536 

59960 

59969 

*7537 

59960 

59969 

*7538 

59960 

59969 

TABLE 6G.—ADDITIONS TO THE CC 

EXCLUSIONS LIST—Continued 

[CCs that are added to the list are in Table 

6G-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.] 

*7539 

5851 

5852 

5853 

5854 

5855 

5856 

5859 

59960 

59969 

*7685 

77012 

77018 

*7686 

77012 

77018 

*7689 

77012 

77018 

*769 

77012 

77018 

*7700 

77012 

77018 

*77010 

7685 

769 

7700 

77012 

77018 

7702 

7703 

7704 

7705 

7707 

77084 

*77011 

7685 

769 

7700 

77012 

77018 

7702 

7703 

7704 

7705 

7707 

77084 

*77012 

7685 

769 

7700 

77012 

77018 

7702 

7703 

7704 

7705 

7707 

77084 

*77017 

7685 

769 

7700 

77012 

TABLE 6G.—ADDITIONS TO THE CC 

EXCLUSIONS LIST—Continued 

[CCs that are added to the list are in Table 

6G-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.] 

77018 

7702 

7703 

7704 

7705 

7707 

77084 

*77018 

7685 

769 

7700 

77012 

77018 

7702 

7703 

7704 

7705 

7707 

77084 

*7702 

77012 

77018 

*7703 

77012 

77018 

*7704 

77012 

77018 

*7705 

77012 

77018 

*7706 

77012 

77018 

*7707 

77012 

77018 

*77081 

77012 

77018 

*77082 

77012 

77018 

*77083 

77012 

77018 

*77084 

77012 

77018 

*77089 

77012 

77018 

*7709 

77012 

77018 

*77981 

77012 

77018 

*77982 

77012 

77018 

*77983 

77012 

77018 

*77984 

76501 

23608 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

TABLE 6G.—ADDITIONS TO THE CC 

EXCLUSIONS LIST—Continued 

[CCs that are added to the list are in Table 

6G-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.] 

76502 

76503 

76504 

76505 

76506 

76507 

76508 

7670 

76711 

7685 

769 

7700 

77012 

77018 

7702 

7703 

7704 

7705 

7707 

77084 

7710 

7711 

7713 

77181 

77183 

77210 

77211 

77212 

77213 

77214 

7722 

7724 

7725 

7730 

7731 

7732 

7733 

7734 

7740 

7741 

7742 

77430 

77431 

77439 

7744 

7745 

7747 

7751 

7752 

7753 

7754 

7755 

7756 

7757 

7760 

7761 

7762 

7763 

7771 

7772 

7775 

7776 

7780 

7790 

7791 

7797 

TABLE 6G.—ADDITIONS TO THE CC 

EXCLUSIONS LIST—Continued 

[CCs that are added to the list are in Table 

6G-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.] 

*77989 

77012 

77018 

*78091 

79901 

79902 

*78092 

79901 

79902 

*78093 

79901 

79902 

*78094 

79901 

79902 

*78095 

04082 

44024 

78001 

78003 

7801 

78031 

78039 

7817 

7854 

78550 

78551 

78552 

78559 

7863 

78820 

78829 

7895 

7907 

7911 

7913 

79901 

79902 

7991 

7994 

*78099 

79901 

79902 

*7881 

59960 

59969 

*7980 

79901 

79902 

*79901 

79901 

79902 

7991 

*79902 

79901 

79902 

7991 

*7991 

79901 

79902 

*79981 

79901 

79902 

*79989 

79901 

79902 

TABLE 6G.—ADDITIONS TO THE CC 

EXCLUSIONS LIST—Continued 

[CCs that are added to the list are in Table 

6G-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.] 

*99640 

99640 

99641 

99642 

99643 

99644 

99645 

99646 

99647 

99649 

99657 

99660 

99666 

99667 

99669 

99670 

99677 

99678 

99679 

*99641 

99640 

99641 

99642 

99643 

99644 

99645 

99646 

99647 

99649 

99657 

99660 

99666 

99667 

99669 

99670 

99677 

99678 

99679 

*99642 

99640 

99641 

99642 

99643 

99644 

99645 

99646 

99647 

99649 

99657 

99660 

99666 

99667 

99669 

99670 

99677 

99678 

99679 

*99643 

99640 

99641 

99642 

99643 

99644 

99645 

99646 

99647 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23609 

TABLE 6G.—ADDITIONS TO THE CC 

EXCLUSIONS LIST—Continued 

[CCs that are added to the list are in Table 

6G-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.] 

99649 

99657 

99660 

99666 

99667 

99669 

99670 

99677 

99678 

99679 

*99644 

99640 

99641 

99642 

99643 

99644 

99645 

99646 

99647 

99649 

99657 

99660 

99666 

99667 

99669 

99670 

99677 

99678 

99679 

*99645 

99640 

99641 

99642 

99643 

99644 

99645 

99646 

99647 

99649 

99657 

99660 

99666 

99667 

99669 

99670 

99677 

99678 

99679 

*99646 

99640 

99641 

99642 

99643 

99644 

99645 

99646 

99647 

99649 

99657 

99660 

99666 

99667 

99669 

99670 

99677 

99678 

TABLE 6G.—ADDITIONS TO THE CC 

EXCLUSIONS LIST—Continued 

[CCs that are added to the list are in Table 

6G-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.] 

99679 

*99647 

99640 

99641 

99642 

99643 

99644 

99645 

99646 

99647 

99649 

99657 

99660 

99666 

99667 

99669 

99670 

99677 

99678 

99679 

*99649 

99640 

99641 

99642 

99643 

99644 

99645 

99646 

99647 

99649 

99657 

99660 

99666 

99667 

99669 

99670 

99677 

99678 

99679 

*99666 

99640 

99641 

99642 

99643 

99644 

99645 

99646 

99647 

99649 

*99667 

99640 

99641 

99642 

99643 

99644 

99645 

99646 

99647 

99649 

*99677 

99640 

99641 

99642 

99643 

99644 

99645 

TABLE 6G.—ADDITIONS TO THE CC 

EXCLUSIONS LIST—Continued 

[CCs that are added to the list are in Table 

6G-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.] 

99646 

99647 

99649 

*99678 

99640 

99641 

99642 

99643 

99644 

99645 

99646 

99647 

99649 

*99791 

99640 

99641 

99642 

99643 

99644 

99645 

99646 

99647 

99649 

*99799 

99640 

99641 

99642 

99643 

99644 

99645 

99646 

99647 

99649 

*99881 

99640 

99641 

99642 

99643 

99644 

99645 

99646 

99647 

99649 

*99883 

99640 

99641 

99642 

99643 

99644 

99645 

99646 

99647 

99649 

*99889 

99640 

99641 

99642 

99643 

99644 

99645 

99646 

99647 

99649 

*9989 

99640 

99641 

23610 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

TABLE 6G.—ADDITIONS TO THE CC 

EXCLUSIONS LIST—Continued 

[CCs that are added to the list are in Table 

6G-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.] 

99642 

99643 

99644 

99645 

99646 

99647 

99649 

*V460 

V4613 

V4614 

*V4611 

V4613 

V4614 

*V4612 

V4613 

V4614 

*V4613 

V4611 

V4612 

V4613 

V4614 

*V4614 

V4611 

V4612 

V4613 

V4614 

*V462 

V4613 

V4614 

*V468 

V4613 

V4614 

*V469 

V4613 

V4614 

TABLE 6H.—DELETIONS TO THE CC 

EXCLUSIONS LIST

[CCs that are deleted from the list are in Table 

6H-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. 

*185 

5996 

*1880 

5996 

*1881 

5996 

*1882 

5996 

*1883 

5996 

*1884 

5996 

*1885 

5996 

*1886 

5996 

*1887 

5996 

*1888 

5996 

TABLE 6H.—DELETIONS TO THE CC 

EXCLUSIONS LIST—Continued 

[CCs that are deleted from the list are in Table 

6H-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. 

*1889 

5996 

*1892 

5996 

*1893 

5996 

*1894 

5996 

*1898 

5996 

*1899 

5996 

*25040 

585 

*25041 

585 

*25042 

585 

*25043 

585 

*25080 

585 

*25081 

585 

*25082 

585 

*25083 

585 

*25090 

585 

*25091 

585 

*25092 

585 

*25093 

585 

*27410 

585 

*27411 

5996 

*27419 

585 

*2760 

2765 

*2761 

2765 

*2762 

2765 

*2763 

2765 

*2764 

2765 

*2765 

2760 

2761 

2762 

2763 

2764 

2765 

2766 

2767 

2769 

*2766 

2765 

*2767 

2765 

TABLE 6H.—DELETIONS TO THE CC 

EXCLUSIONS LIST—Continued 

[CCs that are deleted from the list are in Table 

6H-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. 

*2768 

2765 

*2769 

2765 

*2860 

2873 

*2861 

2873 

*2862 

2873 

*2863 

2873 

*2864 

2873 

*2865 

2873 

*2866 

2873 

*2867 

2873 

*2869 

2873 

*2870 

2873 

*2871 

2873 

*2872 

2873 

*2873 

2860 

2861 

2862 

2863 

2864 

2865 

2866 

2867 

2869 

2870 

2871 

2872 

2873 

2874 

2875 

2878 

2879 

*2874 

2873 

*2875 

2873 

*2878 

2873 

*2879 

2873 

*28981 

2873 

*28982 

2873 

*28989 

2873 

*2899 

2873 

*34461 

5996 

*5670 

5672 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23611 

TABLE 6H.—DELETIONS TO THE CC 

EXCLUSIONS LIST—Continued 

[CCs that are deleted from the list are in Table 

6H-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. 

5678 

*5671 

5672 

5678 

*5672 

5670 

5671 

5672 

5678 

5679 

*5678 

5670 

5671 

5672 

5678 

5679 

*5679 

5672 

5678 

*56989 

5672 

5678 

*5699 

5672 

5678 

*5800 

585 

*5804 

585 

*58081 

585 

*58089 

585 

*5809 

585 

*5810 

585 

*5811 

585 

*5812 

585 

*5813 

585 

*58181 

585 

*58189 

585 

*5819 

585 

*5820 

585 

*5821 

585 

*5822 

585 

*5824 

585 

*58281 

585 

*58289 

585 

*5829 

585 

*5830 

585 

*5831 

TABLE 6H.—DELETIONS TO THE CC 

EXCLUSIONS LIST—Continued 

[CCs that are deleted from the list are in Table 

6H-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. 

585 

*5832 

585 

*5834 

585 

*5836 

585 

*5837 

585 

*58381 

585 

*58389 

585 

*5839 

585 

*5845 

585 

*5846 

585 

*5847 

585 

*5848 

585 

*5849 

585 

*585 

5800 

5804 

58081 

58089 

5809 

5810 

5811 

5812 

5813 

58181 

58189 

5819 

5834 

5845 

5846 

5847 

5848 

5849 

585 

59010 

59011 

5902 

5903 

59080 

59081 

5909 

591 

*586 

585 

*587 

585 

*5880 

585 

*5881 

585 

*58881 

585 

*58889 

585 

*5889 

TABLE 6H.—DELETIONS TO THE CC 

EXCLUSIONS LIST—Continued 

[CCs that are deleted from the list are in Table 

6H-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. 

585 

*5890 

585 

*5891 

585 

*5899 

585 

*59000 

585 

*59001 

585 

*59010 

585 

*59011 

585 

*5902 

585 

*5903 

585 

*59080 

585 

*59081 

585 

*5909 

585 

*591 

585 

*5921 

5996 

*5929 

5996 

*5930 

585 

*5931 

585 

*5932 

585 

*5933 

5996 

*5934 

5996 

*5935 

5996 

*59389 

585 

5996 

*5939 

585 

5996 

*5940 

5996 

*5941 

5996 

*5942 

5996 

*5948 

5996 

*5949 

5996 

*5950 

5996 

*5951 

5996 

*5952 

5996 

*5953 

23612 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

TABLE 6H.—DELETIONS TO THE CC 

EXCLUSIONS LIST—Continued 

[CCs that are deleted from the list are in Table 

6H-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. 

5996 

*5954 

5996 

*59581 

5996 

*59582 

5996 

*59589 

5996 

*5959 

5996 

*5960 

5996 

*59651 

5996 

*59652 

5996 

*59653 

5996 

*59654 

5996 

*59655 

5996 

*59659 

5996 

*5968 

5996 

*5969 

5996 

*5970 

5996 

*59780 

5996 

*59781 

5996 

*59789 

5996 

*59800 

5996 

*59801 

5996 

*5981 

5996 

*5982 

5996 

*5988 

5996 

*5989 

5996 

*5990 

5996 

*5991 

5996 

*5992 

5996 

*5993 

5996 

*5994 

5996 

*5995 

5996 

*5996 

5921 

5935 

5950 

5951 

TABLE 6H.—DELETIONS TO THE CC 

EXCLUSIONS LIST—Continued 

[CCs that are deleted from the list are in Table 

6H-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. 

5952 

5954 

59581 

59582 

59589 

5959 

5970 

5981 

5982 

5990 

5994 

5996 

78820 

78829 

*5997 

585 

5996 

*59981 

585 

5996 

*59982 

585 

5996 

*59983 

585 

5996 

*59984 

585 

5996 

*59989 

585 

5996 

*5999 

585 

5996 

*60000 

5996 

*60001 

5996 

*60010 

5996 

*60011 

5996 

*60020 

5996 

*60021 

5996 

*6003 

5996 

*60090 

5996 

*60091 

5996 

*6010 

5996 

*6011 

5996 

*6012 

5996 

*6013 

5996 

*6014 

5996 

*6018 

5996 

*6019 

TABLE 6H.—DELETIONS TO THE CC 

EXCLUSIONS LIST—Continued 

[CCs that are deleted from the list are in Table 

6H-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. 

5996 

*6020 

5996 

*6021 

5996 

*6022 

5996 

*6023 

5996 

*6028 

5996 

*6029 

5996 

*7530 

585 

5996 

*75310 

585 

5996 

*75311 

585 

5996 

*75312 

585 

5996 

*75313 

585 

5996 

*75314 

585 

5996 

*75315 

585 

5996 

*75316 

585 

5996 

*75317 

585 

5996 

*75319 

585 

5996 

*75320 

585 

5996 

*75321 

585 

5996 

*75322 

585 

5996 

*75323 

585 

5996 

*75329 

585 

5996 

*7533 

585 

5996 

*7534 

5996 

*7535 

5996 

*7536 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23613 

TABLE 6H.—DELETIONS TO THE CC 

EXCLUSIONS LIST—Continued 

[CCs that are deleted from the list are in Table 

6H-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. 

5996 

*7537 

5996 

*7538 

5996 

*7539 

585 

5996 

*7685 

7701 

*7686 

7701 

*7689 

7701 

*769 

7701 

*7700 

7701 

*7701 

7685 

769 

7700 

7701 

7702 

7703 

7704 

7705 

7707 

77084 

*7702 

7701 

*7703 

TABLE 6H.—DELETIONS TO THE CC 

EXCLUSIONS LIST—Continued 

[CCs that are deleted from the list are in Table 

6H-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. 

7701 

*7704 

7701 

*7705 

7701 

*7706 

7701 

*7707 

7701 

*77081 

7701 

*77082 

7701 

*77083 

7701 

*77084 

7701 

*77089 

7701 

*7709 

7701 

*77981 

7701 

*77982 

7701 

*77983 

7701 

*77989 

7701 

*7881 

5996 

*7990 

TABLE 6H.—DELETIONS TO THE CC 

EXCLUSIONS LIST—Continued 

[CCs that are deleted from the list are in Table 

6H-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. 

7991 

*9964 

9964 

99657 

99660 

99666 

99667 

99669 

99670 

99677 

99678 

99679 

*99666 

9964 

*99667 

9964 

*99677 

9964 

*99678 

9964 

*99791 

9964 

*99799 

9964 

*99881 

9964 

*99883 

9964 

*99889 

9964 

*9989 

9964 

TABLE 7A.—MEDICARE PROSPECTIVE PAYMENT SYSTEM SELECTED PERCENTILE LENGTHS OF STAY

[FY 2004 MedPAR Update December 2004 GROUPER V22.0] 

DRG Number of 

discharges 

Arithmetic 

means LOS 

10th 

percentile 

25th 

percentile 

50th 

percentile 

75 

percentile 

90th 

percentile 

1 ............................................................... 23,272 9.8371 3 5 8 13 19 

2 ............................................................... 10,351 4.5604 1 2 4 6 9 

3 ............................................................... 4 9.5000 1 1 8 14 15 

6 ............................................................... 410 3.0512 1 1 2 4 7 

7 ............................................................... 15,592 9.2952 2 4 7 12 19 

8 ............................................................... 3,701 2.8652 1 1 2 4 7 

9 ............................................................... 1,945 6.1594 1 3 5 7 12 

10 ............................................................. 19,511 6.0234 2 3 5 8 12 

11 ............................................................. 3,279 3.7600 1 2 3 5 7 

12 ............................................................. 54,431 5.3747 2 3 4 6 10 

13 ............................................................. 7,337 4.9162 2 3 4 6 8 

14 ............................................................. 236,958 5.6626 2 3 4 7 11 

15 ............................................................. 76,129 4.5225 1 2 4 6 8 

16 ............................................................. 16,264 6.3451 2 3 5 8 12 

17 ............................................................. 3,008 3.2114 1 2 2 4 6 

18 ............................................................. 33,082 5.2590 2 3 4 7 10 

19 ............................................................. 8,568 3.4383 1 2 3 4 6 

20 ............................................................. 6,532 9.8403 3 5 8 12 19 

21 ............................................................. 2,197 6.3245 2 3 5 8 13 

22 ............................................................. 3,316 5.2223 2 2 4 7 10 

23 ............................................................. 10,732 3.8906 1 2 3 5 7 

24 ............................................................. 63,863 4.7303 1 2 4 6 9 

25 ............................................................. 28,153 3.1246 1 2 3 4 6 

26 ............................................................. 18 6.2778 1 2 3 4 8 

27 ............................................................. 5,387 5.1142 1 1 3 6 11 

28 ............................................................. 17,558 5.7440 1 3 4 7 12 

29 ............................................................. 6,274 3.3202 1 1 3 4 6 

23614 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

TABLE 7A.—MEDICARE PROSPECTIVE PAYMENT SYSTEM SELECTED PERCENTILE LENGTHS OF STAY—Continued 

[FY 2004 MedPAR Update December 2004 GROUPER V22.0] 

DRG Number of 

discharges 

Arithmetic 

means LOS 

10th 

percentile 

25th 

percentile 

50th 

percentile 

75 

percentile 

90th 

percentile 

30 ............................................................. 1 19.0000 19 19 19 19 19 

31 ............................................................. 5,090 3.9800 1 2 3 5 8 

32 ............................................................. 1,982 2.4001 1 1 2 3 5 

34 ............................................................. 27,872 4.7722 1 2 4 6 9 

35 ............................................................. 7,895 3.0011 1 1 3 4 6 

36 ............................................................. 1,472 1.6019 1 1 1 1 3 

37 ............................................................. 1,241 4.1281 1 1 3 5 9 

38 ............................................................. 56 3.5179 1 1 2 4 6 

39 ............................................................. 448 2.3772 1 1 1 2 5 

40 ............................................................. 1,383 4.1063 1 1 4 5 8 

42 ............................................................. 1,145 2.7721 1 1 2 4 6 

43 ............................................................. 125 3.1440 1 1 2 4 6 

44 ............................................................. 1,160 4.7836 2 3 4 6 8 

45 ............................................................. 2,803 3.0756 1 2 2 4 6 

46 ............................................................. 3,819 4.1712 1 2 3 5 8 

47 ............................................................. 1,335 2.8854 1 1 2 4 5 

49 ............................................................. 2,478 4.3906 1 2 3 5 8 

50 ............................................................. 2,170 1.8143 1 1 1 2 3 

51 ............................................................. 190 2.7632 1 1 1 3 6 

52 ............................................................. 165 1.9818 1 1 1 2 4 

53 ............................................................. 2,225 3.9542 1 1 2 5 9 

54 ............................................................. 1 7.0000 7 7 7 7 7 

55 ............................................................. 1,354 3.1300 1 1 2 4 7 

56 ............................................................. 435 2.5724 1 1 1 3 6 

57 ............................................................. 698 4.1547 1 1 2 5 9 

59 ............................................................. 102 2.5392 1 1 1 2 6 

60 ............................................................. 8 3.2500 1 1 2 4 4 

61 ............................................................. 219 5.4064 1 1 3 7 12 

63 ............................................................. 2,842 4.4838 1 2 3 5 9 

64 ............................................................. 3,343 6.0464 1 2 4 8 13 

65 ............................................................. 41,424 2.7728 1 1 2 3 5 

66 ............................................................. 8,007 3.1309 1 1 2 4 6 

67 ............................................................. 419 3.6826 1 2 3 4 7 

68 ............................................................. 17,328 3.9720 1 2 3 5 7 

69 ............................................................. 4,816 3.0328 1 2 3 4 5 

70 ............................................................. 25 2.3600 1 1 2 3 4 

71 ............................................................. 68 4.0000 1 2 3 5 7 

72 ............................................................. 1,066 3.4531 1 2 3 4 7 

73 ............................................................. 7,935 4.3806 1 2 3 6 9 

74 ............................................................. 4 2.5000 2 2 2 3 3 

75 ............................................................. 45,034 9.8129 3 5 7 12 20 

76 ............................................................. 47,341 10.8198 3 5 8 13 21 

77 ............................................................. 2,153 4.6716 1 2 4 6 9 

78 ............................................................. 45,631 6.2559 2 4 6 8 10 

79 ............................................................. 170,684 8.1939 3 4 7 10 15 

80 ............................................................. 7,724 5.3718 2 3 4 7 10 

81 ............................................................. 4 11.5000 8 8 11 13 14 

82 ............................................................. 65,161 6.6908 2 3 5 9 13 

83 ............................................................. 6,950 5.2373 2 3 4 7 10 

84 ............................................................. 1,472 3.1454 1 2 3 4 6 

85 ............................................................. 21,878 6.2321 2 3 5 8 12 

86 ............................................................. 1,861 3.6239 1 2 3 5 7 

87 ............................................................. 82,727 6.4131 2 3 5 8 12 

88 ............................................................. 413,844 4.9009 2 3 4 6 9 

89 ............................................................. 550,707 5.6477 2 3 5 7 10 

90 ............................................................. 45,868 3.8123 2 2 3 5 7 

91 ............................................................. 45 4.3556 1 2 3 5 9 

92 ............................................................. 16,495 5.9978 2 3 5 8 11 

93 ............................................................. 1,598 3.8273 1 2 3 5 7 

94 ............................................................. 13,338 6.1223 2 3 5 8 12 

95 ............................................................. 1,612 3.6340 1 2 3 5 7 

96 ............................................................. 59,134 4.3754 2 2 4 5 8 

97 ............................................................. 27,017 3.3864 1 2 3 4 6 

98 ............................................................. 8 2.5000 1 2 2 3 3 

99 ............................................................. 21,547 3.1101 1 1 2 4 6 

100 ........................................................... 6,953 2.1151 1 1 2 3 4 

101 ........................................................... 23,105 4.2502 1 2 3 5 8 

102 ........................................................... 5,237 2.4921 1 1 2 3 5 

103 ........................................................... 724 37.3798 8 12 23 48 79 

104 ........................................................... 20,953 14.4988 6 8 12 18 25 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23615 

TABLE 7A.—MEDICARE PROSPECTIVE PAYMENT SYSTEM SELECTED PERCENTILE LENGTHS OF STAY—Continued 

[FY 2004 MedPAR Update December 2004 GROUPER V22.0] 

DRG Number of 

discharges 

Arithmetic 

means LOS 

10th 

percentile 

25th 

percentile 

50th 

percentile 

75 

percentile 

90th 

percentile 

105 ........................................................... 31,568 9.9544 4 6 8 12 18 

106 ........................................................... 3,499 11.2138 5 7 9 13 19 

107 ........................................................... 70,111 10.5005 5 7 9 12 17 

108 ........................................................... 8,878 9.8314 1 5 8 12 19 

109 ........................................................... 50,742 7.7661 4 5 6 9 13 

110 ........................................................... 57,167 8.3880 1 3 7 11 17 

111 ........................................................... 10,077 3.4273 1 1 3 5 7 

113 ........................................................... 37,263 12.5945 4 6 10 16 24 

114 ........................................................... 8,514 8.4514 2 4 7 11 16 

115 ........................................................... 22,137 6.8327 1 2 5 9 14 

116 ........................................................... 118,685 4.2655 1 1 3 6 9 

117 ........................................................... 5,151 4.2386 1 1 2 5 10 

118 ........................................................... 7,605 3.0473 1 1 2 4 7 

119 ........................................................... 993 5.4945 1 1 3 7 13 

120 ........................................................... 36,309 9.0439 1 3 6 12 20 

121 ........................................................... 159,575 6.2485 2 3 5 8 12 

122 ........................................................... 61,768 3.3855 1 2 3 4 6 

123 ........................................................... 33,656 4.7990 1 1 3 6 11 

124 ........................................................... 130,770 4.3991 1 2 3 6 9 

125 ........................................................... 95,808 2.7249 1 1 2 3 5 

126 ........................................................... 5,823 11.2705 3 6 9 14 21 

127 ........................................................... 695,800 5.1260 2 3 4 6 10 

128 ........................................................... 5,181 5.1662 2 3 5 6 9 

129 ........................................................... 3,762 2.5944 1 1 1 3 6 

130 ........................................................... 89,126 5.4275 1 3 5 7 10 

131 ........................................................... 23,839 3.8048 1 2 4 5 7 

132 ........................................................... 117,297 2.8049 1 1 2 3 5 

133 ........................................................... 7,287 2.1806 1 1 2 3 4 

134 ........................................................... 42,414 3.1069 1 2 2 4 6 

135 ........................................................... 7,439 4.2879 1 2 3 5 8 

136 ........................................................... 1,133 2.7643 1 1 2 3 5 

138 ........................................................... 207,068 3.9126 1 2 3 5 7 

139 ........................................................... 78,609 2.4367 1 1 2 3 5 

140 ........................................................... 38,178 2.4370 1 1 2 3 5 

141 ........................................................... 121,892 3.4612 1 2 3 4 6 

142 ........................................................... 52,279 2.4785 1 1 2 3 5 

143 ........................................................... 249,312 2.0936 1 1 2 3 4 

144 ........................................................... 99,715 5.6964 1 2 4 7 12 

145 ........................................................... 6,187 2.6198 1 1 2 3 5 

146 ........................................................... 10,769 9.8862 5 6 8 12 17 

147 ........................................................... 2,634 5.8193 3 4 6 7 9 

148 ........................................................... 135,681 12.0864 5 7 9 15 22 

149 ........................................................... 19,915 5.9490 3 4 6 7 9 

150 ........................................................... 22,708 10.8769 4 6 9 14 20 

151 ........................................................... 5,353 5.1362 1 2 5 7 10 

152 ........................................................... 5,007 8.0429 3 5 7 9 14 

153 ........................................................... 2,092 4.9809 2 3 5 6 8 

154 ........................................................... 28,497 13.0520 3 6 10 16 25 

155 ........................................................... 6,161 4.1344 1 2 3 6 8 

156 ........................................................... 6 24.1667 1 5 9 27 27 

157 ........................................................... 8,260 5.7196 1 2 4 7 12 

158 ........................................................... 4,106 2.6086 1 1 2 3 5 

159 ........................................................... 19,174 5.1209 1 2 4 7 10 

160 ........................................................... 11,988 2.6625 1 1 2 3 5 

161 ........................................................... 10,428 4.3945 1 2 3 6 9 

162 ........................................................... 5,497 2.0806 1 1 1 3 4 

163 ........................................................... 10 2.9000 1 1 2 3 6 

164 ........................................................... 5,945 7.9862 3 5 7 10 14 

165 ........................................................... 2,523 4.2089 2 3 4 5 7 

166 ........................................................... 4,933 4.5046 1 2 3 5 9 

167 ........................................................... 4,634 2.2169 1 1 2 3 4 

168 ........................................................... 1,544 4.9087 1 2 3 6 10 

169 ........................................................... 756 2.2844 1 1 2 3 5 

170 ........................................................... 17,471 10.7718 2 5 8 14 22 

171 ........................................................... 1,484 4.0964 1 2 3 5 8 

172 ........................................................... 32,879 6.8401 2 3 5 9 14 

173 ........................................................... 2,392 3.5920 1 1 3 5 7 

174 ........................................................... 267,905 4.7020 2 3 4 6 9 

175 ........................................................... 32,657 2.8910 1 2 2 4 5 

176 ........................................................... 14,560 5.1422 2 3 4 6 10 

23616 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

TABLE 7A.—MEDICARE PROSPECTIVE PAYMENT SYSTEM SELECTED PERCENTILE LENGTHS OF STAY—Continued 

[FY 2004 MedPAR Update December 2004 GROUPER V22.0] 

DRG Number of 

discharges 

Arithmetic 

means LOS 

10th 

percentile 

25th 

percentile 

50th 

percentile 

75 

percentile 

90th 

percentile 

177 ........................................................... 8,554 4.4329 2 2 4 5 8 

178 ........................................................... 2,909 3.1158 1 2 3 4 5 

179 ........................................................... 14,429 5.8559 2 3 5 7 11 

180 ........................................................... 92,193 5.3215 2 3 4 7 10 

181 ........................................................... 25,897 3.3265 1 2 3 4 6 

182 ........................................................... 292,198 4.4293 1 2 3 5 8 

183 ........................................................... 86,576 2.8664 1 1 2 4 5 

184 ........................................................... 78 3.2821 1 2 2 4 6 

185 ........................................................... 5,680 4.4905 1 2 3 5 9 

186 ........................................................... 4 2.0000 1 1 1 3 3 

187 ........................................................... 621 4.1723 1 2 3 5 8 

188 ........................................................... 90,968 5.5332 1 2 4 7 11 

189 ........................................................... 13,182 3.0882 1 1 2 4 6 

190 ........................................................... 69 4.3768 1 2 3 5 8 

191 ........................................................... 10,411 12.6933 3 6 9 16 26 

192 ........................................................... 1,322 5.6899 1 3 5 7 10 

193 ........................................................... 4,514 12.0549 5 7 10 15 22 

194 ........................................................... 521 6.6756 3 4 6 8 11 

195 ........................................................... 3,249 10.6190 4 6 9 13 19 

196 ........................................................... 701 5.7275 2 4 5 7 9 

197 ........................................................... 17,317 9.0988 3 5 7 11 17 

198 ........................................................... 4,645 4.3208 2 3 4 6 7 

199 ........................................................... 1,425 9.5298 2 4 7 13 19 

200 ........................................................... 936 9.6976 1 4 7 12 20 

201 ........................................................... 2,665 13.7471 3 6 10 18 28 

202 ........................................................... 27,281 6.1787 2 3 5 8 12 

203 ........................................................... 31,656 6.4850 2 3 5 8 13 

204 ........................................................... 72,845 5.5246 2 3 4 7 11 

205 ........................................................... 31,474 5.8950 2 3 4 7 12 

206 ........................................................... 2,081 3.8847 1 2 3 5 8 

207 ........................................................... 35,754 5.2393 1 2 4 7 10 

208 ........................................................... 9,758 2.9364 1 1 2 4 6 

209 ........................................................... 461,222 4.5677 3 3 4 5 7 

210 ........................................................... 128,455 6.6967 3 4 6 8 11 

211 ........................................................... 26,708 4.6708 3 3 4 5 7 

212 ........................................................... 10 2.9000 1 1 3 4 4 

213 ........................................................... 10,257 9.1059 2 4 7 12 18 

216 ........................................................... 17,656 5.7608 1 1 3 8 14 

217 ........................................................... 17,622 12.4479 3 5 9 15 26 

218 ........................................................... 28,708 5.4480 2 3 4 7 10 

219 ........................................................... 21,361 3.1063 1 2 3 4 5 

220 ........................................................... 4 2.7500 2 2 3 3 3 

223 ........................................................... 13,425 3.2055 1 1 2 4 6 

224 ........................................................... 10,889 1.8875 1 1 1 2 3 

225 ........................................................... 6,514 5.1650 1 2 4 7 11 

226 ........................................................... 6,660 6.3380 1 2 4 8 13 

227 ........................................................... 5,074 2.6139 1 1 2 3 5 

228 ........................................................... 2,640 4.1258 1 1 3 5 9 

229 ........................................................... 1,201 2.5129 1 1 2 3 5 

230 ........................................................... 2,565 5.5922 1 2 4 7 12 

232 ........................................................... 729 2.8230 1 1 1 3 6 

233 ........................................................... 15,118 6.6726 1 2 5 9 14 

234 ........................................................... 7,676 2.7952 1 1 2 4 6 

235 ........................................................... 4,970 4.6463 1 2 4 6 9 

236 ........................................................... 42,408 4.4748 1 3 4 5 8 

237 ........................................................... 2,022 3.6682 1 2 3 4 7 

238 ........................................................... 9,869 8.2633 3 4 6 10 15 

239 ........................................................... 42,943 6.0632 2 3 5 7 11 

240 ........................................................... 12,653 6.6177 2 3 5 8 13 

241 ........................................................... 2,696 3.7066 1 2 3 5 7 

242 ........................................................... 2,742 6.5864 2 3 5 8 12 

243 ........................................................... 101,477 4.5166 1 2 4 6 8 

244 ........................................................... 15,792 4.4924 1 2 4 6 8 

245 ........................................................... 5,840 3.1334 1 1 3 4 6 

246 ........................................................... 1,430 3.5664 1 2 3 4 7 

247 ........................................................... 21,671 3.3172 1 2 3 4 6 

248 ........................................................... 15,118 4.8397 1 3 4 6 9 

249 ........................................................... 14,026 3.8285 1 1 3 5 8 

250 ........................................................... 4,155 3.8876 1 2 3 5 7 

251 ........................................................... 2,148 2.7514 1 1 3 3 5 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23617 

TABLE 7A.—MEDICARE PROSPECTIVE PAYMENT SYSTEM SELECTED PERCENTILE LENGTHS OF STAY—Continued 

[FY 2004 MedPAR Update December 2004 GROUPER V22.0] 

DRG Number of 

discharges 

Arithmetic 

means LOS 

10th 

percentile 

25th 

percentile 

50th 

percentile 

75 

percentile 

90th 

percentile 

252 ........................................................... 1 1.0000 1 1 1 1 1 

253 ........................................................... 24,857 4.5324 2 3 4 5 8 

254 ........................................................... 10,420 3.0461 1 2 3 4 5 

255 ........................................................... 1 7.0000 7 7 7 7 7 

256 ........................................................... 7,152 5.0301 1 2 4 6 10 

257 ........................................................... 13,512 2.6104 1 1 2 3 5 

258 ........................................................... 12,042 1.7498 1 1 1 2 3 

259 ........................................................... 2,903 2.7689 1 1 1 3 7 

260 ........................................................... 2,991 1.4055 1 1 1 1 2 

261 ........................................................... 1,603 2.2052 1 1 1 2 4 

262 ........................................................... 636 4.8428 1 2 4 7 10 

263 ........................................................... 23,809 10.7403 3 5 8 13 21 

264 ........................................................... 3,922 6.2358 2 3 5 8 12 

265 ........................................................... 4,307 6.5677 1 2 4 8 14 

266 ........................................................... 2,304 3.1788 1 1 2 4 7 

267 ........................................................... 272 4.1838 1 1 3 5 10 

268 ........................................................... 1,004 3.5508 1 1 2 4 7 

269 ........................................................... 10,686 8.3273 2 4 6 11 16 

270 ........................................................... 2,639 3.8151 1 1 3 5 8 

271 ........................................................... 21,054 6.7875 2 3 5 8 12 

272 ........................................................... 5,942 5.8009 2 3 4 7 11 

273 ........................................................... 1,349 3.6449 1 2 3 5 7 

274 ........................................................... 2,288 6.2592 2 3 5 8 12 

275 ........................................................... 228 3.2456 1 1 2 4 7 

276 ........................................................... 1,447 4.4630 1 2 4 6 8 

277 ........................................................... 112,318 5.5013 2 3 5 7 10 

278 ........................................................... 33,865 4.0567 2 2 3 5 7 

279 ........................................................... 6 4.6667 1 3 5 6 6 

280 ........................................................... 19,272 4.0080 1 2 3 5 7 

281 ........................................................... 7,093 2.8429 1 1 2 4 5 

283 ........................................................... 6,274 4.5695 1 2 3 6 9 

284 ........................................................... 1,833 3.0295 1 1 2 4 6 

285 ........................................................... 7,623 10.0454 3 5 8 12 19 

286 ........................................................... 2,703 5.4802 2 2 4 6 10 

287 ........................................................... 6,114 9.8368 3 5 7 12 19 

288 ........................................................... 10,450 4.1090 2 2 3 4 7 

289 ........................................................... 6,894 2.5582 1 1 1 2 5 

290 ........................................................... 10,859 2.1325 1 1 1 2 4 

291 ........................................................... 64 2.7969 1 1 1 2 5 

292 ........................................................... 7,331 10.0308 2 4 8 13 20 

293 ........................................................... 368 4.4674 1 2 3 6 9 

294 ........................................................... 98,963 4.2920 1 2 3 5 8 

295 ........................................................... 4,102 3.6675 1 2 3 4 7 

296 ........................................................... 254,706 4.7202 1 2 4 6 9 

297 ........................................................... 45,347 3.0710 1 2 3 4 6 

298 ........................................................... 81 3.9383 1 1 2 4 7 

299 ........................................................... 1,478 5.1604 1 2 4 6 10 

300 ........................................................... 21,343 5.8673 2 3 5 7 11 

301 ........................................................... 3,901 3.4107 1 2 3 4 6 

302 ........................................................... 9,649 8.1898 4 5 6 9 14 

303 ........................................................... 23,760 7.3943 3 4 6 9 14 

304 ........................................................... 13,826 8.4735 2 3 6 11 18 

305 ........................................................... 3,087 3.2096 1 2 3 4 6 

306 ........................................................... 6,350 5.4737 1 2 3 8 12 

307 ........................................................... 2,066 2.0736 1 1 2 2 3 

308 ........................................................... 7,093 6.1095 1 2 4 8 14 

309 ........................................................... 3,559 2.0014 1 1 1 2 4 

310 ........................................................... 26,035 4.5265 1 2 3 6 10 

311 ........................................................... 6,480 1.8782 1 1 1 2 3 

312 ........................................................... 1,456 4.8365 1 1 3 6 11 

313 ........................................................... 508 2.2165 1 1 2 3 4 

314 ........................................................... 1 2.0000 2 2 2 2 2 

315 ........................................................... 36,565 6.7584 1 1 4 9 16 

316 ........................................................... 180,999 6.2874 2 3 5 8 12 

317 ........................................................... 2,766 3.4678 1 1 2 4 7 

318 ........................................................... 5,927 5.7441 1 2 4 7 11 

319 ........................................................... 383 2.7546 1 1 2 3 6 

320 ........................................................... 218,684 5.0953 2 3 4 6 9 

321 ........................................................... 31,401 3.5963 1 2 3 4 6 

322 ........................................................... 61 3.4918 2 2 3 4 6 

23618 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

TABLE 7A.—MEDICARE PROSPECTIVE PAYMENT SYSTEM SELECTED PERCENTILE LENGTHS OF STAY—Continued 

[FY 2004 MedPAR Update December 2004 GROUPER V22.0] 

DRG Number of 

discharges 

Arithmetic 

means LOS 

10th 

percentile 

25th 

percentile 

50th 

percentile 

75 

percentile 

90th 

percentile 

323 ........................................................... 20,482 3.0937 1 1 2 4 6 

324 ........................................................... 5,421 1.8843 1 1 1 2 3 

325 ........................................................... 9,615 3.6813 1 2 3 5 7 

326 ........................................................... 2,584 2.6207 1 1 2 3 5 

327 ........................................................... 5 2.6000 1 1 2 3 5 

328 ........................................................... 606 3.4719 1 1 3 5 7 

329 ........................................................... 72 1.8333 1 1 1 2 3 

331 ........................................................... 54,798 5.4332 1 2 4 7 11 

332 ........................................................... 4,389 3.1246 1 1 2 4 6 

333 ........................................................... 252 5.4921 1 2 3 7 13 

334 ........................................................... 9,810 4.3009 2 2 3 5 7 

335 ........................................................... 11,931 2.6866 1 2 3 3 4 

336 ........................................................... 31,264 3.2999 1 2 2 4 7 

337 ........................................................... 25,156 1.9182 1 1 2 2 3 

338 ........................................................... 652 6.1748 1 2 3 9 14 

339 ........................................................... 1,253 5.1173 1 1 3 7 11 

340 ........................................................... 2 5.0000 4 4 6 6 6 

341 ........................................................... 3,185 3.1586 1 1 2 3 7 

342 ........................................................... 565 3.4248 1 2 2 4 8 

344 ........................................................... 2,693 2.7037 1 1 1 2 6 

345 ........................................................... 1,461 4.8077 1 1 3 6 11 

346 ........................................................... 3,966 5.7307 1 3 4 7 11 

347 ........................................................... 247 3.0202 1 1 2 4 7 

348 ........................................................... 4,171 4.0897 1 2 3 5 8 

349 ........................................................... 575 2.3583 1 1 2 3 4 

350 ........................................................... 7,137 4.4541 2 2 4 5 8 

352 ........................................................... 975 4.0133 1 2 3 5 8 

353 ........................................................... 2,735 6.3192 2 3 4 7 12 

354 ........................................................... 7,612 5.6967 2 3 4 6 10 

355 ........................................................... 4,937 3.0614 2 2 3 4 4 

356 ........................................................... 23,993 1.9281 1 1 2 2 3 

357 ........................................................... 5,570 8.1269 3 4 6 10 15 

358 ........................................................... 20,798 3.9629 2 2 3 4 7 

359 ........................................................... 28,741 2.4058 1 2 2 3 4 

360 ........................................................... 14,764 2.5880 1 1 2 3 4 

361 ........................................................... 272 3.0184 1 1 2 3 7 

362 ........................................................... 2 1.0000 1 1 1 1 1 

363 ........................................................... 2,128 3.7810 1 2 2 4 8 

364 ........................................................... 1,451 4.1909 1 2 3 5 9 

365 ........................................................... 1,622 7.7404 2 3 5 9 17 

366 ........................................................... 4,789 6.4792 2 3 5 8 13 

367 ........................................................... 456 2.9934 1 1 2 4 6 

368 ........................................................... 3,924 6.6351 2 3 5 8 13 

369 ........................................................... 3,613 3.2419 1 1 2 4 6 

370 ........................................................... 1,843 5.1557 2 3 4 5 8 

371 ........................................................... 2,244 3.3944 2 3 3 4 5 

372 ........................................................... 1,164 3.1847 2 2 2 3 5 

373 ........................................................... 4,871 2.2373 1 2 2 3 3 

374 ........................................................... 156 2.7436 2 2 2 3 4 

375 ........................................................... 6 4.0000 1 2 2 6 6 

376 ........................................................... 388 3.3711 1 2 2 4 6 

377 ........................................................... 77 4.4805 1 1 3 4 8 

378 ........................................................... 196 2.3163 1 1 2 3 4 

379 ........................................................... 508 2.8130 1 1 2 3 6 

380 ........................................................... 91 2.1099 1 1 1 2 4 

381 ........................................................... 212 2.2642 1 1 1 2 4 

382 ........................................................... 43 1.4419 1 1 1 2 2 

383 ........................................................... 2,473 3.6526 1 1 2 4 7 

384 ........................................................... 132 2.5606 1 1 1 3 5 

385 ........................................................... 1 1.0000 1 1 1 1 1 

389 ........................................................... 1 21.0000 21 21 21 21 21 

390 ........................................................... 1 1.0000 1 1 1 1 1 

392 ........................................................... 2,203 9.1770 2 4 6 11 19 

393 ........................................................... 1 4.0000 4 4 4 4 4 

394 ........................................................... 2,820 7.3553 1 2 5 9 16 

395 ........................................................... 116,129 4.2575 1 2 3 5 8 

396 ........................................................... 9 4.4444 1 1 2 3 6 

397 ........................................................... 18,482 5.1407 1 2 4 6 10 

398 ........................................................... 18,288 5.7016 2 3 4 7 11 

399 ........................................................... 1,640 3.3250 1 2 3 4 6 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23619 

TABLE 7A.—MEDICARE PROSPECTIVE PAYMENT SYSTEM SELECTED PERCENTILE LENGTHS OF STAY—Continued 

[FY 2004 MedPAR Update December 2004 GROUPER V22.0] 

DRG Number of 

discharges 

Arithmetic 

means LOS 

10th 

percentile 

25th 

percentile 

50th 

percentile 

75 

percentile 

90th 

percentile 

401 ........................................................... 6,328 11.0390 2 5 9 14 22 

402 ........................................................... 1,401 4.0293 1 1 3 5 9 

403 ........................................................... 31,865 7.9367 2 3 6 10 16 

404 ........................................................... 3,802 4.1528 1 2 3 5 8 

406 ........................................................... 2,224 9.9150 2 4 7 12 21 

407 ........................................................... 584 3.8253 1 2 3 5 7 

408 ........................................................... 2,170 8.1949 1 2 5 10 19 

409 ........................................................... 1,808 5.7954 1 3 4 6 12 

410 ........................................................... 28,417 3.8214 1 2 3 5 6 

411 ........................................................... 12 3.2500 1 2 2 4 4 

412 ........................................................... 12 2.7500 1 1 1 3 4 

413 ........................................................... 5,198 6.7563 2 3 5 9 13 

414 ........................................................... 573 4.0244 1 2 3 5 8 

415 ........................................................... 50,827 14.0035 4 6 11 18 28 

416 ........................................................... 239,006 7.3769 2 3 6 9 14 

417 ........................................................... 23 5.2174 1 2 3 5 10 

418 ........................................................... 28,508 6.1657 2 3 5 8 12 

419 ........................................................... 16,282 4.3857 1 2 3 5 8 

420 ........................................................... 2,941 3.3747 1 2 3 4 6 

421 ........................................................... 11,882 4.0613 1 2 3 5 7 

422 ........................................................... 52 3.7115 1 1 2 4 7 

423 ........................................................... 8,637 8.2173 2 3 6 10 17 

424 ........................................................... 1,071 11.7274 2 4 8 14 22 

425 ........................................................... 14,779 3.4569 1 1 3 4 7 

426 ........................................................... 4,313 4.1203 1 2 3 5 8 

427 ........................................................... 1,505 4.7375 1 2 3 5 9 

428 ........................................................... 773 7.2549 1 2 5 8 15 

429 ........................................................... 25,479 5.4228 2 3 4 6 10 

430 ........................................................... 71,439 7.6737 2 3 6 9 15 

431 ........................................................... 304 5.8947 1 2 4 7 12 

432 ........................................................... 420 4.2548 1 2 3 5 8 

433 ........................................................... 5,191 2.9626 1 1 2 3 6 

439 ........................................................... 1,739 8.7993 1 3 5 10 19 

440 ........................................................... 5,613 8.7825 2 3 6 10 18 

441 ........................................................... 779 3.3813 1 1 2 4 7 

442 ........................................................... 18,017 8.6810 2 3 6 11 18 

443 ........................................................... 3,385 3.4003 1 1 3 4 7 

444 ........................................................... 5,892 4.0324 1 2 3 5 8 

445 ........................................................... 2,346 2.8372 1 1 2 4 5 

447 ........................................................... 6,264 2.5686 1 1 2 3 5 

448 ........................................................... 1 2.0000 2 2 2 2 2 

449 ........................................................... 38,802 3.6742 1 1 3 4 7 

450 ........................................................... 7,805 1.9867 1 1 1 2 4 

451 ........................................................... 3 1.6667 1 1 1 3 3 

452 ........................................................... 27,634 4.8762 1 2 3 6 10 

453 ........................................................... 5,437 2.7993 1 1 2 3 5 

454 ........................................................... 3,837 4.1058 1 2 3 5 8 

455 ........................................................... 846 2.2222 1 1 2 3 4 

461 ........................................................... 2,722 5.1267 1 1 3 6 12 

462 ........................................................... 7,761 10.1584 4 6 8 13 18 

463 ........................................................... 31,045 3.8939 1 2 3 5 7 

464 ........................................................... 7,661 2.9141 1 1 2 4 5 

465 ........................................................... 219 3.6347 1 1 2 4 7 

466 ........................................................... 1,377 4.7117 1 1 2 5 9 

467 ........................................................... 1,015 2.6788 1 1 2 3 5 

468 ........................................................... 50,481 12.8082 3 6 10 16 25 

471 ........................................................... 15,614 5.0496 3 3 4 5 8 

473 ........................................................... 8,778 12.4026 2 3 7 18 32 

475 ........................................................... 116,534 11.0157 2 5 9 14 21 

476 ........................................................... 3,025 10.4998 2 4 9 14 21 

477 ........................................................... 29,407 8.5221 1 3 6 11 18 

478 ........................................................... 113,660 7.1046 1 2 5 9 15 

479 ........................................................... 24,603 2.7884 1 1 2 4 6 

480 ........................................................... 802 17.9102 7 9 13 22 36 

481 ........................................................... 1,066 21.8208 10 16 20 25 35 

482 ........................................................... 5,076 11.4967 4 6 9 14 21 

484 ........................................................... 449 12.7506 2 6 10 17 25 

485 ........................................................... 3,420 9.6038 4 5 7 11 18 

486 ........................................................... 2,562 12.3478 2 6 10 16 25 

487 ........................................................... 4,644 7.0540 1 3 5 9 14 

23620 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

TABLE 7A.—MEDICARE PROSPECTIVE PAYMENT SYSTEM SELECTED PERCENTILE LENGTHS OF STAY—Continued 

[FY 2004 MedPAR Update December 2004 GROUPER V22.0] 

DRG Number of 

discharges 

Arithmetic 

means LOS 

10th 

percentile 

25th 

percentile 

50th 

percentile 

75 

percentile 

90th 

percentile 

488 ........................................................... 786 16.3422 4 7 13 22 35 

489 ........................................................... 13,461 8.3538 2 3 6 10 17 

490 ........................................................... 5,204 5.3918 1 2 4 7 11 

491 ........................................................... 19,789 3.1423 1 2 3 3 5 

492 ........................................................... 4,012 13.6269 3 5 6 23 31 

493 ........................................................... 61,628 6.0515 1 3 5 8 12 

494 ........................................................... 25,626 2.6772 1 1 2 4 5 

495 ........................................................... 307 17.4072 8 9 13 19 31 

496 ........................................................... 3,261 8.9877 3 4 6 11 18 

497 ........................................................... 29,453 6.0617 3 4 5 7 10 

498 ........................................................... 19,400 3.7954 2 3 3 5 6 

499 ........................................................... 35,676 4.3236 1 2 3 5 9 

500 ........................................................... 48,323 2.2420 1 1 2 3 4 

501 ........................................................... 3,122 9.9308 4 5 8 13 18 

502 ........................................................... 717 5.6987 2 3 5 7 9 

503 ........................................................... 5,909 3.8284 1 2 3 5 7 

504 ........................................................... 187 27.1818 8 16 23 36 49 

505 ........................................................... 179 4.6704 1 1 1 6 11 

506 ........................................................... 1,004 15.9273 3 7 13 21 33 

507 ........................................................... 307 8.4919 1 3 7 11 18 

508 ........................................................... 641 7.2044 1 3 5 9 15 

509 ........................................................... 168 5.1607 1 2 3 6 11 

510 ........................................................... 1,755 6.4160 1 2 4 8 14 

511 ........................................................... 635 4.0787 1 1 2 5 8 

512 ........................................................... 513 12.7719 7 8 10 14 23 

513 ........................................................... 227 9.9824 5 7 8 12 16 

515 ........................................................... 27,312 4.2899 1 1 2 6 11 

516 ........................................................... 38,732 4.7893 2 2 4 6 9 

517 ........................................................... 66,287 2.5801 1 1 1 3 6 

518 ........................................................... 41,113 3.4800 1 1 2 4 8 

519 ........................................................... 11,506 4.8233 1 1 3 6 11 

520 ........................................................... 15,266 2.0074 1 1 1 2 4 

521 ........................................................... 32,148 5.4742 2 3 4 7 11 

522 ........................................................... 5,646 9.3666 3 4 7 12 19 

523 ........................................................... 15,866 3.8769 1 2 3 5 7 

524 ........................................................... 118,949 3.1907 1 2 3 4 6 

525 ........................................................... 315 13.4222 1 3 8 16 32 

526 ........................................................... 55,877 4.3572 1 2 3 5 8 

527 ........................................................... 192,230 2.2326 1 1 1 2 5 

528 ........................................................... 1,770 17.1090 6 10 15 22 30 

529 ........................................................... 4,032 7.9923 1 2 5 10 18 

530 ........................................................... 2,363 3.1240 1 1 2 4 6 

531 ........................................................... 4,799 9.4049 2 4 7 12 20 

532 ........................................................... 2,622 3.7227 1 1 3 5 8 

533 ........................................................... 47,609 3.7364 1 1 2 4 9 

534 ........................................................... 45,285 1.7909 1 1 1 2 3 

535 ........................................................... 13,002 8.2678 1 3 7 11 17 

536 ........................................................... 19,606 5.4113 1 2 4 7 12 

537 ........................................................... 8,641 6.7775 1 3 5 8 14 

538 ........................................................... 5,604 2.8164 1 1 2 4 6 

539 ........................................................... 5,020 10.7639 2 4 7 14 23 

540 ........................................................... 1,510 3.5808 1 1 3 4 7 

541 ........................................................... 22,369 42.8902 17 25 35 52 76 

542 ........................................................... 24,376 32.5434 12 18 27 40 58 

543 ........................................................... 5,415 11.9830 2 5 10 16 24 

12,140,152 

TABLE 7B.—MEDICARE PROSPECTIVE PAYMENT SYSTEM SELECTED PERCENTILE LENGTHS OF STAY

[FY 2004 MedPAR Update December 2004 GROUPER V23.0] 

DRG Number of 

discharges 

Arithmetic 

mean LOS 

10th 

percentile 

25th 

percentile 

50th 

percentile 

75th 

percentile 

90th 

percentile 

1 ............................................................... 23,271 9.8373 3 5 8 13 19 

2 ............................................................... 10,351 4.5604 1 2 4 6 9 

3 ............................................................... 4 9.5000 1 1 8 14 15 

6 ............................................................... 410 3.0512 1 1 2 4 7 

7 ............................................................... 15,592 9.2952 2 4 7 12 19 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23621 

TABLE 7B.—MEDICARE PROSPECTIVE PAYMENT SYSTEM SELECTED PERCENTILE LENGTHS OF STAY—Continued 

[FY 2004 MedPAR Update December 2004 GROUPER V23.0] 

DRG Number of 

discharges 

Arithmetic 

mean LOS 

10th 

percentile 

25th 

percentile 

50th 

percentile 

75th 

percentile 

90th 

percentile 

8 ............................................................... 3,701 2.8652 1 1 2 4 7 

9 ............................................................... 1,945 6.1594 1 3 5 7 12 

10 ............................................................. 19,511 6.0234 2 3 5 8 12 

11 ............................................................. 3,279 3.7600 1 2 3 5 7 

12 ............................................................. 54,431 5.3747 2 3 4 6 10 

13 ............................................................. 7,337 4.9162 2 3 4 6 8 

14 ............................................................. 236,958 5.6626 2 3 4 7 11 

15 ............................................................. 76,129 4.5225 1 2 4 6 8 

16 ............................................................. 16,264 6.3451 2 3 5 8 12 

17 ............................................................. 3,008 3.2114 1 2 2 4 6 

18 ............................................................. 33,082 5.2590 2 3 4 7 10 

19 ............................................................. 8,568 3.4383 1 2 3 4 6 

20 ............................................................. 6,532 9.8403 3 5 8 12 19 

21 ............................................................. 2,197 6.3245 2 3 5 8 13 

22 ............................................................. 3,316 5.2223 2 2 4 7 10 

23 ............................................................. 10,732 3.8906 1 2 3 5 7 

24 ............................................................. 63,863 4.7303 1 2 4 6 9 

25 ............................................................. 28,153 3.1246 1 2 3 4 6 

26 ............................................................. 18 6.2778 1 2 3 4 8 

27 ............................................................. 5,387 5.1142 1 1 3 6 11 

28 ............................................................. 17,558 5.7440 1 3 4 7 12 

29 ............................................................. 6,274 3.3202 1 1 3 4 6 

30 ............................................................. 1 19.0000 19 19 19 19 19 

31 ............................................................. 5,090 3.9800 1 2 3 5 8 

32 ............................................................. 1,982 2.4001 1 1 2 3 5 

34 ............................................................. 27,872 4.7722 1 2 4 6 9 

35 ............................................................. 17,895 3.0011 1 1 3 4 6 

36 ............................................................. 1,472 1.6019 1 1 1 1 3 

37 ............................................................. 1,241 4.1281 1 1 3 5 9 

38 ............................................................. 56 3.5179 1 1 2 4 6 

39 ............................................................. 448 2.3772 1 1 1 2 5 

40 ............................................................. 1,383 4.1063 1 1 4 5 8 

42 ............................................................. 1,145 2.7721 1 1 2 4 6 

43 ............................................................. 125 3.1440 1 1 2 4 6 

44 ............................................................. 1,160 4.7836 2 3 4 6 8 

45 ............................................................. 2,803 3.0756 1 2 2 4 6 

46 ............................................................. 3,819 4.1712 1 2 3 5 8 

47 ............................................................. 1,335 2.8854 1 1 2 4 5 

49 ............................................................. 2,478 4.3906 1 2 3 5 8 

50 ............................................................. 2,170 1.8143 1 1 1 2 3 

51 ............................................................. 190 2.7632 1 1 1 3 6 

52 ............................................................. 165 1.9818 1 1 1 2 4 

53 ............................................................. 2,225 3.9542 1 1 2 5 9 

54 ............................................................. 1 7.0000 7 7 7 7 7 

55 ............................................................. 1,354 3.1300 1 1 2 4 7 

56 ............................................................. 435 2.5724 1 1 1 3 6 

57 ............................................................. 698 4.1547 1 1 2 5 9 

59 ............................................................. 102 2.5392 1 1 1 2 6 

60 ............................................................. 8 3.2500 1 1 2 4 4 

61 ............................................................. 219 5.4064 1 1 3 7 12 

63 ............................................................. 2,842 4.4838 1 2 3 5 9 

64 ............................................................. 3,343 6.0464 1 2 4 8 13 

65 ............................................................. 41,424 2.7728 1 1 2 3 5 

66 ............................................................. 8,007 3.1309 1 1 2 4 6 

67 ............................................................. 419 3.6826 1 2 3 4 7 

68 ............................................................. 17,328 3.9720 1 2 3 5 7 

69 ............................................................. 4,816 3.0328 1 2 3 4 5 

70 ............................................................. 25 2.3600 1 1 2 3 4 

71 ............................................................. 68 4.0000 1 2 3 5 7 

72 ............................................................. 1,066 3.4531 1 2 3 4 7 

73 ............................................................. 7,935 4.3806 1 2 3 6 9 

74 ............................................................. 4 2.5000 2 2 2 3 3 

75 ............................................................. 45,031 9.8127 3 5 7 12 20 

76 ............................................................. 47,341 10.8198 3 5 8 13 21 

77 ............................................................. 2,153 4.6716 1 2 4 6 9 

78 ............................................................. 45,631 6.2559 2 4 6 8 10 

79 ............................................................. 170,684 8.1939 3 4 7 10 15 

80 ............................................................. 7,724 5.3718 2 3 4 7 10 

81 ............................................................. 4 11.5000 8 8 11 13 14 

82 ............................................................. 65,161 6.6908 2 3 5 9 13 

23622 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

TABLE 7B.—MEDICARE PROSPECTIVE PAYMENT SYSTEM SELECTED PERCENTILE LENGTHS OF STAY—Continued 

[FY 2004 MedPAR Update December 2004 GROUPER V23.0] 

DRG Number of 

discharges 

Arithmetic 

mean LOS 

10th 

percentile 

25th 

percentile 

50th 

percentile 

75th 

percentile 

90th 

percentile 

83 ............................................................. 6,950 5.2373 2 3 4 7 10 

84 ............................................................. 1,472 3.1454 1 2 3 4 6 

85 ............................................................. 21,878 6.2321 2 3 5 8 12 

86 ............................................................. 1,861 3.6239 1 2 3 5 7 

87 ............................................................. 82,727 6.4131 2 3 5 8 12 

88 ............................................................. 413,844 4.9009 2 3 4 6 9 

89 ............................................................. 550,707 5.6477 2 3 5 7 10 

90 ............................................................. 45,868 3.8123 2 2 3 5 7 

91 ............................................................. 45 4.3556 1 2 3 5 9 

92 ............................................................. 16,495 5.9978 2 3 5 8 11 

93 ............................................................. 1,598 3.8273 1 2 3 5 7 

94 ............................................................. 13,338 6.1223 2 3 5 8 12 

95 ............................................................. 1,612 3.6340 1 2 3 5 7 

96 ............................................................. 59,134 4.3754 2 2 4 5 8 

97 ............................................................. 27,017 3.3864 1 2 3 4 6 

98 ............................................................. 8 2.5000 1 2 2 3 3 

99 ............................................................. 21,547 3.1101 1 1 2 4 6 

100 ........................................................... 6,953 2.1151 1 1 2 3 4 

101 ........................................................... 23,105 4.2502 1 2 3 5 8 

102 ........................................................... 5,237 2.4921 1 1 2 3 5 

103 ........................................................... 724 37.3798 8 12 23 48 79 

104 ........................................................... 20,929 14.5053 6 8 12 18 25 

105 ........................................................... 31,544 9.9561 4 6 8 12 18 

106 ........................................................... 3,499 11.2138 5 7 9 13 19 

107 ........................................................... 70,111 10.5005 5 7 9 12 17 

108 ........................................................... 7,947 10.6922 4 6 9 13 19 

109 ........................................................... 50,742 7.7661 4 5 6 9 13 

110 ........................................................... 57,167 8.3880 1 3 7 11 17 

111 ........................................................... 10,077 3.4273 1 1 3 5 7 

113 ........................................................... 37,263 12.5945 4 6 10 16 24 

114 ........................................................... 8,514 8.4514 2 4 7 11 16 

115 ........................................................... 22,137 6.8327 1 2 5 9 14 

116 ........................................................... 118,685 4.2655 1 1 3 6 9 

117 ........................................................... 5,151 4.2386 1 1 2 5 10 

118 ........................................................... 7,605 3.0473 1 1 2 4 7 

119 ........................................................... 993 5.4945 1 1 3 7 13 

120 ........................................................... 36,309 9.0439 1 3 6 12 20 

121 ........................................................... 159,575 6.2485 2 3 5 8 12 

122 ........................................................... 61,768 3.3855 1 2 3 4 6 

123 ........................................................... 33,656 4.7990 1 1 3 6 11 

124 ........................................................... 130,770 4.3991 1 2 3 6 9 

125 ........................................................... 95,808 2.7249 1 1 2 3 5 

126 ........................................................... 5,823 11.2705 3 6 9 14 21 

127 ........................................................... 695,800 5.1260 2 3 4 6 10 

128 ........................................................... 5,181 5.1662 2 3 5 6 9 

129 ........................................................... 3,762 2.5944 1 1 1 3 6 

130 ........................................................... 89,126 5.4275 1 3 5 7 10 

131 ........................................................... 23,839 3.8048 1 2 4 5 7 

132 ........................................................... 117,297 2.8049 1 1 2 3 5 

133 ........................................................... 7,287 2.1806 1 1 2 3 4 

134 ........................................................... 42,414 3.1069 1 2 2 4 6 

135 ........................................................... 7,439 4.2879 1 2 3 5 8 

136 ........................................................... 1,133 2.7643 1 1 2 3 5 

138 ........................................................... 207,068 3.9126 1 2 3 5 7 

139 ........................................................... 78,609 2.4367 1 1 2 3 5 

140 ........................................................... 38,178 2.4370 1 1 2 3 5 

141 ........................................................... 121,892 3.4612 1 2 3 4 6 

142 ........................................................... 52,279 2.4785 1 1 2 3 5 

143 ........................................................... 249,312 2.0936 1 1 2 3 4 

144 ........................................................... 99,715 5.6964 1 2 4 7 12 

145 ........................................................... 6,187 2.6198 1 1 2 3 5 

146 ........................................................... 10,769 9.8862 5 6 8 12 17 

147 ........................................................... 2,634 5.8193 3 4 6 7 9 

148 ........................................................... 135,681 12.0864 5 7 9 15 22 

149 ........................................................... 19,915 5.9490 3 4 6 7 9 

150 ........................................................... 22,708 10.8769 4 6 9 14 20 

151 ........................................................... 5,353 5.1362 1 2 5 7 10 

152 ........................................................... 5,007 8.0429 3 5 7 9 14 

153 ........................................................... 2,092 4.9809 2 3 5 6 8 

154 ........................................................... 28,496 13.0519 3 6 10 16 25 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23623 

TABLE 7B.—MEDICARE PROSPECTIVE PAYMENT SYSTEM SELECTED PERCENTILE LENGTHS OF STAY—Continued 

[FY 2004 MedPAR Update December 2004 GROUPER V23.0] 

DRG Number of 

discharges 

Arithmetic 

mean LOS 

10th 

percentile 

25th 

percentile 

50th 

percentile 

75th 

percentile 

90th 

percentile 

155 ........................................................... 6,161 4.1344 1 2 3 6 8 

156 ........................................................... 6 24.1667 1 5 9 27 27 

157 ........................................................... 8,260 5.7196 1 2 4 7 12 

158 ........................................................... 4,106 2.6086 1 1 2 3 5 

159 ........................................................... 19,174 5.1209 1 2 4 7 10 

160 ........................................................... 11,988 2.6625 1 1 2 3 5 

161 ........................................................... 10,428 4.3945 1 2 3 6 9 

162 ........................................................... 5,497 2.0806 1 1 1 3 4 

163 ........................................................... 10 2.9000 1 1 2 3 6 

164 ........................................................... 5,945 7.9862 3 5 7 10 14 

165 ........................................................... 2,523 4.2089 2 3 4 5 7 

166 ........................................................... 4,933 4.5046 1 2 3 5 9 

167 ........................................................... 4,634 2.2169 1 1 2 3 4 

168 ........................................................... 1,544 4.9087 1 2 3 6 10 

169 ........................................................... 756 2.2844 1 1 2 3 5 

170 ........................................................... 17,471 10.7718 2 5 8 14 22 

171 ........................................................... 1,484 4.0964 1 2 3 5 8 

172 ........................................................... 32,879 6.8401 2 3 5 9 14 

173 ........................................................... 2,392 3.5920 1 1 3 5 7 

174 ........................................................... 267,905 4.7020 2 3 4 6 9 

175 ........................................................... 32,657 2.8910 1 2 2 4 5 

176 ........................................................... 14,560 5.1422 2 3 4 6 10 

177 ........................................................... 8,554 4.4329 2 2 4 5 8 

178 ........................................................... 2,909 3.1158 1 2 3 4 5 

179 ........................................................... 14,429 5.8559 2 3 5 7 11 

180 ........................................................... 92,193 5.3215 2 3 4 7 10 

181 ........................................................... 25,897 3.3265 1 2 3 4 6 

182 ........................................................... 292,198 4.4293 1 2 3 5 8 

183 ........................................................... 86,576 2.8664 1 1 2 4 5 

184 ........................................................... 78 3.2821 1 2 2 4 6 

185 ........................................................... 5,680 4.4905 1 2 3 5 9 

186 ........................................................... 4 2.0000 1 1 1 3 3 

187 ........................................................... 621 4.1723 1 2 3 5 8 

188 ........................................................... 90,968 5.5332 1 2 4 7 11 

189 ........................................................... 13,182 3.0882 1 1 2 4 6 

190 ........................................................... 69 4.3768 1 2 3 5 8 

191 ........................................................... 10,411 12.6933 3 6 9 16 26 

192 ........................................................... 1,322 5.6899 1 3 5 7 10 

193 ........................................................... 4,514 12.0549 5 7 10 15 22 

194 ........................................................... 521 6.6756 3 4 6 8 11 

195 ........................................................... 3,249 10.6190 4 6 9 13 19 

196 ........................................................... 701 5.7275 2 4 5 7 9 

197 ........................................................... 17,316 9.0988 3 5 7 11 17 

198 ........................................................... 4,645 4.3208 2 3 4 6 7 

199 ........................................................... 1,425 9.5298 2 4 7 13 19 

200 ........................................................... 936 9.6976 1 4 7 12 20 

201 ........................................................... 2,665 13.7471 3 6 10 18 28 

202 ........................................................... 27,281 6.1787 2 3 5 8 12 

203 ........................................................... 31,656 6.4850 2 3 5 8 13 

204 ........................................................... 72,845 5.5246 2 3 4 7 11 

205 ........................................................... 31,474 5.8950 2 3 4 7 12 

206 ........................................................... 2,081 3.8847 1 2 3 5 8 

207 ........................................................... 35,754 5.2393 1 2 4 7 10 

208 ........................................................... 9,758 2.9364 1 1 2 4 6 

210 ........................................................... 128,455 6.6967 3 4 6 8 11 

211 ........................................................... 26,708 4.6708 3 3 4 5 7 

212 ........................................................... 10 2.9000 1 1 3 4 4 

213 ........................................................... 10,257 9.1059 2 4 7 12 18 

216 ........................................................... 17,656 5.7608 1 1 3 8 14 

217 ........................................................... 17,622 12.4479 3 5 9 15 26 

218 ........................................................... 28,708 5.4480 2 3 4 7 10 

219 ........................................................... 21,361 3.1063 1 2 3 4 5 

220 ........................................................... 4 2.7500 2 2 3 3 3 

223 ........................................................... 13,425 3.2055 1 1 2 4 6 

224 ........................................................... 10,889 1.8875 1 1 1 2 3 

225 ........................................................... 6,514 5.1650 1 2 4 7 11 

226 ........................................................... 6,660 6.3380 1 2 4 8 13 

227 ........................................................... 5,074 2.6139 1 1 2 3 5 

228 ........................................................... 2,640 4.1258 1 1 3 5 9 

229 ........................................................... 1,201 2.5129 1 1 2 3 5 

23624 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

TABLE 7B.—MEDICARE PROSPECTIVE PAYMENT SYSTEM SELECTED PERCENTILE LENGTHS OF STAY—Continued 

[FY 2004 MedPAR Update December 2004 GROUPER V23.0] 

DRG Number of 

discharges 

Arithmetic 

mean LOS 

10th 

percentile 

25th 

percentile 

50th 

percentile 

75th 

percentile 

90th 

percentile 

230 ........................................................... 2,565 5.5922 1 2 4 7 12 

232 ........................................................... 729 2.8230 1 1 1 3 6 

233 ........................................................... 15,118 6.6726 1 2 5 9 14 

234 ........................................................... 7,676 2.7952 1 1 2 4 6 

235 ........................................................... 4,970 4.6463 1 2 4 6 9 

236 ........................................................... 42,408 4.4748 1 3 4 5 8 

237 ........................................................... 2,022 3.6682 1 2 3 4 7 

238 ........................................................... 9,869 8.2633 3 4 6 10 15 

239 ........................................................... 42,943 6.0632 2 3 5 7 11 

240 ........................................................... 12,653 6.6177 2 3 5 8 13 

241 ........................................................... 2,696 3.7066 1 2 3 5 7 

242 ........................................................... 2,742 6.5864 2 3 5 8 12 

243 ........................................................... 101,477 4.5166 1 2 4 6 8 

244 ........................................................... 15,792 4.4924 1 2 4 6 8 

245 ........................................................... 5,840 3.1334 1 1 3 4 6 

246 ........................................................... 1,430 3.5664 1 2 3 4 7 

247 ........................................................... 21,671 3.3172 1 2 3 4 6 

248 ........................................................... 15,118 4.8397 1 3 4 6 9 

249 ........................................................... 14,026 3.8285 1 1 3 5 8 

250 ........................................................... 4,155 3.8876 1 2 3 5 7 

251 ........................................................... 2,148 2.7514 1 1 3 3 5 

252 ........................................................... 1 1.0000 1 1 1 1 1 

253 ........................................................... 24,857 4.5324 2 3 4 5 8 

254 ........................................................... 10,420 3.0461 1 2 3 4 5 

255 ........................................................... 1 7.0000 7 7 7 7 7 

256 ........................................................... 7,152 5.0301 1 2 4 6 10 

257 ........................................................... 13,512 2.6104 1 1 2 3 5 

258 ........................................................... 12,042 1.7498 1 1 1 2 3 

259 ........................................................... 2,903 2.7689 1 1 1 3 7 

260 ........................................................... 2,991 1.4055 1 1 1 1 2 

261 ........................................................... 1,603 2.2052 1 1 1 2 4 

262 ........................................................... 636 4.8428 1 2 4 7 10 

263 ........................................................... 23,809 10.7403 3 5 8 13 21 

264 ........................................................... 3,922 6.2358 2 3 5 8 12 

265 ........................................................... 4,307 6.5677 1 2 4 8 14 

266 ........................................................... 2,304 3.1788 1 1 2 4 7 

267 ........................................................... 272 4.1838 1 1 3 5 10 

268 ........................................................... 1,004 3.5508 1 1 2 4 7 

269 ........................................................... 10,686 8.3273 2 4 6 11 16 

270 ........................................................... 2,639 3.8151 1 1 3 5 8 

271 ........................................................... 21,054 6.7875 2 3 5 8 12 

272 ........................................................... 5,942 5.8009 2 3 4 7 11 

273 ........................................................... 1,349 3.6449 1 2 3 5 7 

274 ........................................................... 2,288 6.2592 2 3 5 8 12 

275 ........................................................... 228 3.2456 1 1 2 4 7 

276 ........................................................... 1,447 4.4630 1 2 4 6 8 

277 ........................................................... 112,318 5.5013 2 3 5 7 10 

278 ........................................................... 33,865 4.0567 2 2 3 5 7 

279 ........................................................... 6 4.6667 1 3 5 6 6 

280 ........................................................... 19,272 4.0080 1 2 3 5 7 

281 ........................................................... 7,093 2.8429 1 1 2 4 5 

283 ........................................................... 6,274 4.5695 1 2 3 6 9 

284 ........................................................... 1,833 3.0295 1 1 2 4 6 

285 ........................................................... 7,623 10.0454 3 5 8 12 19 

286 ........................................................... 2,703 5.4802 2 2 4 6 10 

287 ........................................................... 6,114 9.8368 3 5 7 12 19 

288 ........................................................... 10,450 4.1090 2 2 3 4 7 

289 ........................................................... 6,894 2.5582 1 1 1 2 5 

290 ........................................................... 10,859 2.1325 1 1 1 2 4 

291 ........................................................... 64 2.7969 1 1 1 2 5 

292 ........................................................... 7,331 10.0308 2 4 8 13 20 

293 ........................................................... 368 4.4674 1 2 3 6 9 

294 ........................................................... 98,963 4.2920 1 2 3 5 8 

295 ........................................................... 4,102 3.6675 1 2 3 4 7 

296 ........................................................... 254,706 4.7202 1 2 4 6 9 

297 ........................................................... 45,347 3.0710 1 2 3 4 6 

298 ........................................................... 81 3.9383 1 1 2 4 7 

299 ........................................................... 1,478 5.1604 1 2 4 6 10 

300 ........................................................... 21,343 5.8673 2 3 5 7 11 

301 ........................................................... 3,901 3.4107 1 2 3 4 6 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23625 

TABLE 7B.—MEDICARE PROSPECTIVE PAYMENT SYSTEM SELECTED PERCENTILE LENGTHS OF STAY—Continued 

[FY 2004 MedPAR Update December 2004 GROUPER V23.0] 

DRG Number of 

discharges 

Arithmetic 

mean LOS 

10th 

percentile 

25th 

percentile 

50th 

percentile 

75th 

percentile 

90th 

percentile 

302 ........................................................... 9,649 8.1898 4 5 6 9 14 

303 ........................................................... 23,760 7.3943 3 4 6 9 14 

304 ........................................................... 13,826 8.4735 2 3 6 11 18 

305 ........................................................... 3,087 3.2096 1 2 3 4 6 

306 ........................................................... 6,350 5.4737 1 2 3 8 12 

307 ........................................................... 2,066 2.0736 1 1 2 2 3 

308 ........................................................... 7,093 6.1095 1 2 4 8 14 

309 ........................................................... 3,559 2.0014 1 1 1 2 4 

310 ........................................................... 26,035 4.5265 1 2 3 6 10 

311 ........................................................... 6,480 1.8782 1 1 1 2 3 

312 ........................................................... 1,456 4.8365 1 1 3 6 11 

313 ........................................................... 508 2.2165 1 1 2 3 4 

314 ........................................................... 1 2.0000 2 2 2 2 2 

315 ........................................................... 36,565 6.7584 1 1 4 9 16 

316 ........................................................... 180,999 6.2874 2 3 5 8 12 

317 ........................................................... 2,766 3.4678 1 1 2 4 7 

318 ........................................................... 5,927 5.7441 1 2 4 7 11 

319 ........................................................... 383 2.7546 1 1 2 3 6 

320 ........................................................... 218,684 5.0953 2 3 4 6 9 

321 ........................................................... 31,401 3.5963 1 2 3 4 6 

322 ........................................................... 61 3.4918 2 2 3 4 6 

323 ........................................................... 20,482 3.0937 1 1 2 4 6 

324 ........................................................... 5,421 1.8843 1 1 1 2 3 

325 ........................................................... 9,615 3.6813 1 2 3 5 7 

326 ........................................................... 2,584 2.6207 1 1 2 3 5 

327 ........................................................... 5 2.6000 1 1 2 3 5 

328 ........................................................... 606 3.4719 1 1 3 5 7 

329 ........................................................... 72 1.8333 1 1 1 2 3 

331 ........................................................... 54,798 5.4332 1 2 4 7 11 

332 ........................................................... 4,389 3.1246 1 1 2 4 6 

333 ........................................................... 252 5.4921 1 2 3 7 13 

334 ........................................................... 9,810 4.3009 2 2 3 5 7 

335 ........................................................... 11,931 2.6866 1 2 3 3 4 

336 ........................................................... 31,264 3.2999 1 2 2 4 7 

337 ........................................................... 25,156 1.9182 1 1 2 2 3 

338 ........................................................... 652 6.1748 1 2 3 9 14 

339 ........................................................... 1,253 5.1173 1 1 3 7 11 

340 ........................................................... 2 5.0000 4 4 6 6 6 

341 ........................................................... 3,185 3.1586 1 1 2 3 7 

342 ........................................................... 565 3.4248 1 2 2 4 8 

344 ........................................................... 2,693 2.7037 1 1 1 2 6 

345 ........................................................... 1,461 4.8077 1 1 3 6 11 

346 ........................................................... 3,966 5.7307 1 3 4 7 11 

347 ........................................................... 247 3.0202 1 1 2 4 7 

348 ........................................................... 4,171 4.0897 1 2 3 5 8 

349 ........................................................... 575 2.3583 1 1 2 3 4 

350 ........................................................... 7,137 4.4541 2 2 4 5 8 

352 ........................................................... 975 4.0133 1 2 3 5 8 

353 ........................................................... 2,735 6.3192 2 3 4 7 12 

354 ........................................................... 7,612 5.6967 2 3 4 6 10 

355 ........................................................... 4,937 3.0614 2 2 3 4 4 

356 ........................................................... 23,993 1.9281 1 1 2 2 3 

357 ........................................................... 5,570 8.1269 3 4 6 10 15 

358 ........................................................... 20,798 3.9629 2 2 3 4 7 

359 ........................................................... 28,741 2.4058 1 2 2 3 4 

360 ........................................................... 14,764 2.5880 1 1 2 3 4 

361 ........................................................... 272 3.0184 1 1 2 3 7 

362 ........................................................... 2 1.0000 1 1 1 1 1 

363 ........................................................... 2,128 3.7810 1 2 2 4 8 

364 ........................................................... 1,451 4.1909 1 2 3 5 9 

365 ........................................................... 1,622 7.7404 2 3 5 9 17 

366 ........................................................... 4,789 6.4792 2 3 5 8 13 

367 ........................................................... 456 2.9934 1 1 2 4 6 

368 ........................................................... 3,924 6.6351 2 3 5 8 13 

369 ........................................................... 3,613 3.2419 1 1 2 4 6 

370 ........................................................... 1,843 5.1557 2 3 4 5 8 

371 ........................................................... 2,244 3.3944 2 3 3 4 5 

372 ........................................................... 1,164 3.1847 2 2 2 3 5 

373 ........................................................... 4,871 2.2373 1 2 2 3 3 

374 ........................................................... 156 2.7436 2 2 2 3 4 

23626 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

TABLE 7B.—MEDICARE PROSPECTIVE PAYMENT SYSTEM SELECTED PERCENTILE LENGTHS OF STAY—Continued 

[FY 2004 MedPAR Update December 2004 GROUPER V23.0] 

DRG Number of 

discharges 

Arithmetic 

mean LOS 

10th 

percentile 

25th 

percentile 

50th 

percentile 

75th 

percentile 

90th 

percentile 

375 ........................................................... 6 4.0000 1 2 2 6 6 

376 ........................................................... 388 3.3711 1 2 2 4 6 

377 ........................................................... 77 4.4805 1 1 3 4 8 

378 ........................................................... 196 2.3163 1 1 2 3 4 

379 ........................................................... 508 2.8130 1 1 2 3 6 

380 ........................................................... 91 2.1099 1 1 1 2 4 

381 ........................................................... 212 2.2642 1 1 1 2 4 

382 ........................................................... 43 1.4419 1 1 1 2 2 

383 ........................................................... 2,473 3.6526 1 1 2 4 7 

384 ........................................................... 132 2.5606 1 1 1 3 5 

385 ........................................................... 1 1.0000 1 1 1 1 1 

389 ........................................................... 1 21.0000 21 21 21 21 21 

390 ........................................................... 1 1.0000 1 1 1 1 1 

392 ........................................................... 2,203 9.1770 2 4 6 11 19 

393 ........................................................... 1 4.0000 4 4 4 4 4 

394 ........................................................... 2,820 7.3553 1 2 5 9 16 

395 ........................................................... 116,129 4.2575 1 2 3 5 8 

396 ........................................................... 9 4.4444 1 1 2 3 6 

397 ........................................................... 18,482 5.1407 1 2 4 6 10 

398 ........................................................... 18,288 5.7016 2 3 4 7 11 

399 ........................................................... 1,640 3.3250 1 2 3 4 6 

401 ........................................................... 6,328 11.0390 2 5 9 14 22 

402 ........................................................... 1,401 4.0293 1 1 3 5 9 

403 ........................................................... 31,865 7.9367 2 3 6 10 16 

404 ........................................................... 3,802 4.1528 1 2 3 5 8 

406 ........................................................... 2,224 9.9150 2 4 7 12 21 

407 ........................................................... 584 3.8253 1 2 3 5 7 

408 ........................................................... 2,170 8.1949 1 2 5 10 19 

409 ........................................................... 1,808 5.7954 1 3 4 6 12 

410 ........................................................... 28,417 3.8214 1 2 3 5 6 

411 ........................................................... 12 3.2500 1 2 2 4 4 

412 ........................................................... 12 2.7500 1 1 1 3 4 

413 ........................................................... 5,198 6.7563 2 3 5 9 13 

414 ........................................................... 573 4.0244 1 2 3 5 8 

415 ........................................................... 50,826 14.0037 4 6 11 18 28 

416 ........................................................... 239,006 7.3769 2 3 6 9 14 

417 ........................................................... 23 5.2174 1 2 3 5 10 

418 ........................................................... 28,508 6.1657 2 3 5 8 12 

419 ........................................................... 16,282 4.3857 1 2 3 5 8 

420 ........................................................... 2,941 3.3747 1 2 3 4 6 

421 ........................................................... 11,882 4.0613 1 2 3 5 7 

422 ........................................................... 52 3.7115 1 1 2 4 7 

423 ........................................................... 8,637 8.2173 2 3 6 10 17 

424 ........................................................... 1,071 11.7274 2 4 8 14 22 

425 ........................................................... 14,779 3.4569 1 1 3 4 7 

426 ........................................................... 4,313 4.1203 1 2 3 5 8 

427 ........................................................... 1,505 4.7375 1 2 3 5 9 

428 ........................................................... 773 7.2549 1 2 5 8 15 

429 ........................................................... 25,479 5.4228 2 3 4 6 10 

430 ........................................................... 71,439 7.6737 2 3 6 9 15 

431 ........................................................... 304 5.8947 1 2 4 7 12 

432 ........................................................... 420 4.2548 1 2 3 5 8 

433 ........................................................... 5,191 2.9626 1 1 2 3 6 

439 ........................................................... 1,739 8.7993 1 3 5 10 19 

440 ........................................................... 5,613 8.7825 2 3 6 10 18 

441 ........................................................... 779 3.3813 1 1 2 4 7 

442 ........................................................... 18,017 8.6810 2 3 6 11 18 

443 ........................................................... 3,384 3.3992 1 1 3 4 7 

444 ........................................................... 5,892 4.0324 1 2 3 5 8 

445 ........................................................... 2,346 2.8372 1 1 2 4 5 

447 ........................................................... 6,264 2.5686 1 1 2 3 5 

448 ........................................................... 1 2.0000 2 2 2 2 2 

449 ........................................................... 38,802 3.6742 1 1 3 4 7 

450 ........................................................... 7,805 1.9867 1 1 1 2 4 

451 ........................................................... 3 1.6667 1 1 1 3 3 

452 ........................................................... 27,634 4.8762 1 2 3 6 10 

453 ........................................................... 5,437 2.7993 1 1 2 3 5 

454 ........................................................... 3,837 4.1058 1 2 3 5 8 

455 ........................................................... 846 2.2222 1 1 2 3 4 

461 ........................................................... 2,722 5.1267 1 1 3 6 12 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23627 

TABLE 7B.—MEDICARE PROSPECTIVE PAYMENT SYSTEM SELECTED PERCENTILE LENGTHS OF STAY—Continued 

[FY 2004 MedPAR Update December 2004 GROUPER V23.0] 

DRG Number of 

discharges 

Arithmetic 

mean LOS 

10th 

percentile 

25th 

percentile 

50th 

percentile 

75th 

percentile 

90th 

percentile 

462 ........................................................... 7,761 10.1584 4 6 8 13 18 

463 ........................................................... 31,045 3.8939 1 2 3 5 7 

464 ........................................................... 7,661 2.9141 1 1 2 4 5 

465 ........................................................... 219 3.6347 1 1 2 4 7 

466 ........................................................... 1,377 4.7117 1 1 2 5 9 

467 ........................................................... 1,015 2.6788 1 1 2 3 5 

468 ........................................................... 50,458 12.8082 3 6 10 16 25 

471 ........................................................... 15,614 5.0496 3 3 4 5 8 

473 ........................................................... 8,778 12.4026 2 3 7 18 32 

475 ........................................................... 116,534 11.0157 2 5 9 14 21 

476 ........................................................... 3,025 10.4998 2 4 9 14 21 

477 ........................................................... 29,425 8.5246 1 3 6 11 18 

478 ........................................................... 113,660 7.1046 1 2 5 9 15 

479 ........................................................... 24,603 2.7884 1 1 2 4 6 

480 ........................................................... 802 17.9102 7 9 13 22 36 

481 ........................................................... 1,066 21.8208 10 16 20 25 35 

482 ........................................................... 5,076 11.4967 4 6 9 14 21 

484 ........................................................... 449 12.7506 2 6 10 17 25 

485 ........................................................... 3,420 9.6038 4 5 7 11 18 

486 ........................................................... 2,562 12.3478 2 6 10 16 25 

487 ........................................................... 4,644 7.0540 1 3 5 9 14 

488 ........................................................... 786 16.3422 4 7 13 22 35 

489 ........................................................... 13,461 8.3538 2 3 6 10 17 

490 ........................................................... 5,204 5.3918 1 2 4 7 11 

491 ........................................................... 19,789 3.1423 1 2 3 3 5 

492 ........................................................... 4,012 13.6269 3 5 6 23 31 

493 ........................................................... 61,628 6.0515 1 3 5 8 12 

494 ........................................................... 25,626 2.6772 1 1 2 4 5 

495 ........................................................... 304 17.3092 8 9 13 19 31 

496 ........................................................... 3,261 8.9877 3 4 6 11 18 

497 ........................................................... 27,838 5.8368 3 3 5 7 10 

498 ........................................................... 19,057 3.7703 2 3 3 5 6 

499 ........................................................... 35,676 4.3236 1 2 3 5 9 

500 ........................................................... 48,323 2.2420 1 1 2 3 4 

501 ........................................................... 3,122 9.9308 4 5 8 13 18 

502 ........................................................... 717 5.6987 2 3 5 7 9 

503 ........................................................... 5,909 3.8284 1 2 3 5 7 

504 ........................................................... 187 27.1818 8 16 23 36 49 

505 ........................................................... 179 4.6704 1 1 1 6 11 

506 ........................................................... 1,004 15.9273 3 7 13 21 33 

507 ........................................................... 307 8.4919 1 3 7 11 18 

508 ........................................................... 641 7.2044 1 3 5 9 15 

509 ........................................................... 168 5.1607 1 2 3 6 11 

510 ........................................................... 1,755 6.4160 1 2 4 8 14 

511 ........................................................... 635 4.0787 1 1 2 5 8 

512 ........................................................... 513 12.7719 7 8 10 14 23 

513 ........................................................... 227 9.9824 5 7 8 12 16 

515 ........................................................... 44,478 4.3401 1 1 2 6 10 

517 ........................................................... 66,287 2.5801 1 1 1 3 6 

518 ........................................................... 42,044 3.4580 1 1 2 4 8 

519 ........................................................... 11,506 4.8233 1 1 3 6 11 

520 ........................................................... 15,266 2.0074 1 1 1 2 4 

521 ........................................................... 32,148 5.4742 2 3 4 7 11 

522 ........................................................... 5,646 9.3666 3 4 7 12 19 

523 ........................................................... 15,866 3.8769 1 2 3 5 7 

524 ........................................................... 118,949 3.1907 1 2 3 4 6 

525 ........................................................... 313 13.4952 1 3 8 16 32 

527 ........................................................... 192,230 2.2326 1 1 1 2 5 

528 ........................................................... 1,770 17.1090 6 10 15 22 30 

529 ........................................................... 4,032 7.9923 1 2 5 10 18 

530 ........................................................... 2,363 3.1240 1 1 2 4 6 

531 ........................................................... 4,799 9.4049 2 4 7 12 20 

532 ........................................................... 2,622 3.7227 1 1 3 5 8 

533 ........................................................... 47,609 3.7364 1 1 2 4 9 

534 ........................................................... 45,285 1.7909 1 1 1 2 3 

535 ........................................................... 7,387 10.3013 3 5 8 13 20 

536 ........................................................... 8,055 7.6500 2 4 6 9 14 

537 ........................................................... 8,641 6.7775 1 3 5 8 14 

538 ........................................................... 5,604 2.8164 1 1 2 4 6 

539 ........................................................... 5,020 10.7639 2 4 7 14 23 

23628 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

TABLE 7B.—MEDICARE PROSPECTIVE PAYMENT SYSTEM SELECTED PERCENTILE LENGTHS OF STAY—Continued 

[FY 2004 MedPAR Update December 2004 GROUPER V23.0] 

DRG Number of 

discharges 

Arithmetic 

mean LOS 

10th 

percentile 

25th 

percentile 

50th 

percentile 

75th 

percentile 

90th 

percentile 

540 ........................................................... 1,510 3.5808 1 1 3 4 7 

541 ........................................................... 22,435 42.7921 17 24 35 52 76 

542 ........................................................... 24,376 32.5434 12 18 27 40 58 

543 ........................................................... 5,415 11.9830 2 5 10 16 24 

544 ........................................................... 418,885 4.5100 3 3 4 5 7 

545 ........................................................... 42,337 5.1387 3 3 4 6 8 

546 ........................................................... 1,958 9.1062 3 5 7 11 18 

547 ........................................................... 26,797 5.5682 2 3 4 7 10 

548 ........................................................... 11,935 3.0404 1 2 3 4 5 

549 ........................................................... 35,690 5.2044 2 3 4 6 10 

550 ........................................................... 20,187 2.8595 1 2 3 4 5 

12,140,152 

TABLE 8A.—STATEWIDE AVERAGE OPERATING COST-TO-CHARGE RATIOS—MARCH 2005 

State Urban Rural 

Alabama .................... 0.279 0.348 

Alaska ....................... 0.454 0.784 

Arizona ...................... 0.295 0.392 

Arkansas ................... 0.359 0.383 

California ................... 0.251 0.354 

Colorado ................... 0.328 0.483 

Connecticut ............... 0.458 0.522 

Delaware ................... 0.546 0.548 

District of Columbia .. 0.386 ................

Florida ....................... 0.257 0.304 

Georgia ..................... 0.373 0.426 

Hawaii ....................... 0.404 0.479 

Idaho ......................... 0.487 0.577 

Illinois ........................ 0.337 0.442 

Indiana ...................... 0.439 0.47 

Iowa .......................... 0.407 0.505 

Kansas ...................... 0.313 0.471 

Kentucky ................... 0.401 0.404 

Louisiana .................. 0.306 0.369 

Maine ........................ 0.504 0.489 

Maryland ................... 0.762 0.827 

Massachusetts .......... 0.485 ................

Michigan ................... 0.396 0.496 

Minnesota ................. 0.404 0.531 

Mississippi ................ 0.354 0.391 

Missouri .................... 0.346 0.408 

Montana .................... 0.437 0.481 

Nebraska .................. 0.371 0.503 

Nevada ..................... 0.245 0.558 

New Hampshire ........ 0.467 0.508 

New Jersey ............... 0.196 ................

New Mexico .............. 0.428 0.414 

New York .................. 0.372 0.526 

North Carolina .......... 0.454 0.439 

North Dakota ............ 0.418 0.467 

Ohio .......................... 0.389 0.543 

Oklahoma ................. 0.332 0.423 

Oregon ...................... 0.499 0.481 

TABLE 8A.—STATEWIDE AVERAGE OPERATING COST-TO-CHARGE RATIOS—MARCH 2005—Continued 

State Urban Rural 

Pennsylvania ............ 0.299 0.472 

Puerto Rico ............... 0.443 ................

Rhode Island ............ 0.439 ................

South Carolina .......... 0.313 0.34 

South Dakota ............ 0.385 0.498 

Tennessee ................ 0.337 0.402 

Texas ........................ 0.309 0.38 

Utah .......................... 0.428 0.598 

Vermont .................... 0.577 0.635 

Virginia ...................... 0.386 0.398 

Washington ............... 0.454 0.497 

West Virginia ............ 0.492 0.472 

Wisconsin ................. 0.458 0.497 

Wyoming ................... 0.442 0.614 

TABLE 8B.—STATEWIDE AVERAGE

CAPITAL COST-TO-CHARGE RATIOS—MARCH 2005 

State Ratio 

Alabama ........................................ 0.027 

Alaska ........................................... 0.044 

Arizona .......................................... 0.029 

Arkansas ....................................... 0.03 

California ....................................... 0.019 

Colorado ....................................... 0.03 

Connecticut ................................... 0.035 

Delaware ....................................... 0.047 

District of Columbia ...................... 0.029 

Florida ........................................... 0.026 

Georgia ......................................... 0.035 

Hawaii ........................................... 0.034 

Idaho ............................................. 0.041 

Illinois ............................................ 0.03 

Indiana .......................................... 0.041 

Iowa .............................................. 0.033 

TABLE 8B.—STATEWIDE AVERAGE

CAPITAL COST-TO-CHARGE RATIOS—MARCH 2005—Continued 

State Ratio 

Kansas .......................................... 0.033 

Kentucky ....................................... 0.033 

Louisiana ...................................... 0.032 

Maine ............................................ 0.036 

Maryland ....................................... 0.016 

Massachusetts .............................. 0.036 

Michigan ....................................... 0.037 

Minnesota ..................................... 0.034 

Mississippi .................................... 0.032 

Missouri ........................................ 0.029 

Montana ........................................ 0.039 

Nebraska ...................................... 0.039 

Nevada ......................................... 0.019 

New Hampshire ............................ 0.037 

New Jersey ................................... 0.015 

New Mexico .................................. 0.036 

New York ...................................... 0.033 

North Carolina .............................. 0.039 

North Dakota ................................ 0.041 

Ohio .............................................. 0.032 

Oklahoma ..................................... 0.031 

Oregon .......................................... 0.038 

Pennsylvania ................................ 0.026 

Puerto Rico ................................... 0.033 

Rhode Island ................................ 0.022 

South Carolina .............................. 0.03 

South Dakota ................................ 0.04 

Tennessee .................................... 0.034 

Texas ............................................ 0.03 

Utah .............................................. 0.039 

Vermont ........................................ 0.045 

Virginia .......................................... 0.039 

Washington ................................... 0.037 

West Virginia ................................ 0.033 

Wisconsin ..................................... 0.038 

Wyoming ....................................... 0.046 

TABLE 9A.—HOSPITALS RECLASSIFICATIONS AND REDESIGNATIONS BY INDIVIDUAL HOSPITALS AND CBSA—FY 2006 

Provider number Geographic 

CBSA 

Reclassified 

CBSA Lugar 

010005 .................................................................................................................................................... 01 13820 

010008 .................................................................................................................................................... 01 33860 

010012 .................................................................................................................................................... 01 16860 

010022 .................................................................................................................................................... 01 40660 LUGAR 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23629 

TABLE 9A.—HOSPITALS RECLASSIFICATIONS AND REDESIGNATIONS BY INDIVIDUAL HOSPITALS AND CBSA—FY 2006—

Continued 

Provider number Geographic 

CBSA 

Reclassified 

CBSA Lugar 

010025 .................................................................................................................................................... 01 17980 

010029 .................................................................................................................................................... 12220 17980 

010035 .................................................................................................................................................... 01 13820 

010044 .................................................................................................................................................... 01 13820 

010045 .................................................................................................................................................... 01 13820 

010065 .................................................................................................................................................... 01 33860 

010072 .................................................................................................................................................... 01 11500 LUGAR 

010083 .................................................................................................................................................... 01 37860 

010100 .................................................................................................................................................... 01 37860 

010101 .................................................................................................................................................... 01 11500 LUGAR 

010118 .................................................................................................................................................... 01 33860 

010120 .................................................................................................................................................... 01 33660 

010126 .................................................................................................................................................... 01 33860 

010143 .................................................................................................................................................... 01 13820 

010158 .................................................................................................................................................... 01 19460 

030013 .................................................................................................................................................... 49740 20940 

030033 .................................................................................................................................................... 03 22380 

040014 .................................................................................................................................................... 04 30780 

040017 .................................................................................................................................................... 04 44180 

040019 .................................................................................................................................................... 04 32820 

040020 .................................................................................................................................................... 27860 32820 

040027 .................................................................................................................................................... 04 44180 

040039 .................................................................................................................................................... 04 27860 

040041 .................................................................................................................................................... 04 30780 

040047 .................................................................................................................................................... 04 27860 

040069 .................................................................................................................................................... 04 32820 

040071 .................................................................................................................................................... 38220 30780 

040072 .................................................................................................................................................... 04 30780 

040076 .................................................................................................................................................... 04 30780 

040078 .................................................................................................................................................... 26300 30780 

040080 .................................................................................................................................................... 04 27860 

040088 .................................................................................................................................................... 04 43340 

040091 .................................................................................................................................................... 04 45500 

040100 .................................................................................................................................................... 04 30780 

040119 .................................................................................................................................................... 04 30780 

050006 .................................................................................................................................................... 05 39820 

050009 .................................................................................................................................................... 34900 46700 

050013 .................................................................................................................................................... 34900 46700 

050014 .................................................................................................................................................... 05 40900 

050022 .................................................................................................................................................... 40140 42044 

050042 .................................................................................................................................................... 05 39820 

050046 .................................................................................................................................................... 37100 31084 

050054 .................................................................................................................................................... 40140 42044 

050065 .................................................................................................................................................... 42044 31084 

050069 .................................................................................................................................................... 42044 31084 

050071 .................................................................................................................................................... 41940 36084 

050073 .................................................................................................................................................... 46700 36084 

050076 .................................................................................................................................................... 41884 36084 

050082 .................................................................................................................................................... 37100 31084 

050089 .................................................................................................................................................... 40140 31084 

050090 .................................................................................................................................................... 42220 41884 

050099 .................................................................................................................................................... 40140 31084 

050102 .................................................................................................................................................... 40140 42044 

050118 .................................................................................................................................................... 44700 33700 

050129 .................................................................................................................................................... 40140 31084 

050136 .................................................................................................................................................... 42220 41884 

050140 .................................................................................................................................................... 40140 31084 

050150 .................................................................................................................................................... 05 40900 

050159 .................................................................................................................................................... 37100 31084 

050168 .................................................................................................................................................... 42044 31084 

050173 .................................................................................................................................................... 42044 31084 

050174 .................................................................................................................................................... 42220 41884 

050177 .................................................................................................................................................... 37100 31084 

050193 .................................................................................................................................................... 42044 31084 

050224 .................................................................................................................................................... 42044 31084 

050226 .................................................................................................................................................... 42044 31084 

050228 .................................................................................................................................................... 41884 36084 

050230 .................................................................................................................................................... 42044 31084 

050236 .................................................................................................................................................... 37100 31084 

050243 .................................................................................................................................................... 40140 42044 

23630 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

TABLE 9A.—HOSPITALS RECLASSIFICATIONS AND REDESIGNATIONS BY INDIVIDUAL HOSPITALS AND CBSA—FY 2006—

Continued 

Provider number Geographic 

CBSA 

Reclassified 

CBSA Lugar 

050245 .................................................................................................................................................... 40140 31084 

050251 .................................................................................................................................................... 05 39900 

050272 .................................................................................................................................................... 40140 31084 

050279 .................................................................................................................................................... 40140 31084 

050291 .................................................................................................................................................... 42220 41884 

050292 .................................................................................................................................................... 40140 42044 

050298 .................................................................................................................................................... 40140 31084 

050300 .................................................................................................................................................... 40140 31084 

050327 .................................................................................................................................................... 40140 31084 

050329 .................................................................................................................................................... 40140 42044 

050331 .................................................................................................................................................... 42220 41884 

050348 .................................................................................................................................................... 42044 31084 

050385 .................................................................................................................................................... 42220 41884 

050390 .................................................................................................................................................... 40140 42044 

050394 .................................................................................................................................................... 37100 31084 

050419 .................................................................................................................................................... 05 39820 

050423 .................................................................................................................................................... 40140 42044 

050426 .................................................................................................................................................... 42044 31084 

050430 .................................................................................................................................................... 05 39900 

050510 .................................................................................................................................................... 41884 36084 

050517 .................................................................................................................................................... 40140 31084 

050526 .................................................................................................................................................... 42044 31084 

050534 .................................................................................................................................................... 40140 42044 

050535 .................................................................................................................................................... 42044 31084 

050541 .................................................................................................................................................... 41884 36084 

050543 .................................................................................................................................................... 42044 31084 

050547 .................................................................................................................................................... 42220 41884 

050548 .................................................................................................................................................... 42044 31084 

050550 .................................................................................................................................................... 42044 31084 

050551 .................................................................................................................................................... 42044 31084 

050567 .................................................................................................................................................... 42044 31084 

050569 .................................................................................................................................................... 05 42220 

050570 .................................................................................................................................................... 42044 31084 

050573 .................................................................................................................................................... 40140 42044 

050580 .................................................................................................................................................... 42044 31084 

050584 .................................................................................................................................................... 40140 31084 

050585 .................................................................................................................................................... 42044 31084 

050586 .................................................................................................................................................... 40140 31084 

050589 .................................................................................................................................................... 42044 31084 

050592 .................................................................................................................................................... 42044 31084 

050594 .................................................................................................................................................... 42044 31084 

050603 .................................................................................................................................................... 42044 31084 

050609 .................................................................................................................................................... 42044 31084 

050616 .................................................................................................................................................... 37100 31084 

050667 .................................................................................................................................................... 34900 46700 

050668 .................................................................................................................................................... 41884 36084 

050678 .................................................................................................................................................... 42044 31084 

050684 .................................................................................................................................................... 40140 42044 

050686 .................................................................................................................................................... 40140 42044 

050690 .................................................................................................................................................... 42220 41884 

050693 .................................................................................................................................................... 42044 31084 

050694 .................................................................................................................................................... 40140 42044 

050701 .................................................................................................................................................... 40140 42044 

050709 .................................................................................................................................................... 40140 31084 

050718 .................................................................................................................................................... 40140 42044 

050720 .................................................................................................................................................... 42044 31084 

050728 .................................................................................................................................................... 42220 41884 

060001 .................................................................................................................................................... 24540 19740 

060003 .................................................................................................................................................... 14500 19740 

060023 .................................................................................................................................................... 24300 39340 

060027 .................................................................................................................................................... 14500 19740 

060044 .................................................................................................................................................... 06 19740 

060049 .................................................................................................................................................... 06 22660 

060096 .................................................................................................................................................... 06 19740 

060103 .................................................................................................................................................... 14500 19740 

070003 .................................................................................................................................................... 07 25540 LUGAR 

070021 .................................................................................................................................................... 07 25540 LUGAR 

070033 .................................................................................................................................................... 14860 35644 

080004 .................................................................................................................................................... 20100 48864 

080007 .................................................................................................................................................... 08 36140 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23631 

TABLE 9A.—HOSPITALS RECLASSIFICATIONS AND REDESIGNATIONS BY INDIVIDUAL HOSPITALS AND CBSA—FY 2006—

Continued 

Provider number Geographic 

CBSA 

Reclassified 

CBSA Lugar 

100022 .................................................................................................................................................... 33124 22744 

100023 .................................................................................................................................................... 10 36740 

100024 .................................................................................................................................................... 10 33124 

100045 .................................................................................................................................................... 19660 36740 

100049 .................................................................................................................................................... 10 29460 

100081 .................................................................................................................................................... 10 23020 LUGAR 

100109 .................................................................................................................................................... 10 36740 

100118 .................................................................................................................................................... 10 27260 

100139 .................................................................................................................................................... 10 23540 LUGAR 

100150 .................................................................................................................................................... 10 33124 

100157 .................................................................................................................................................... 29460 45300 

100176 .................................................................................................................................................... 48424 38940 

100217 .................................................................................................................................................... 46940 38940 

100232 .................................................................................................................................................... 10 27260 

100239 .................................................................................................................................................... 45300 42260 

100249 .................................................................................................................................................... 10 36100 

100252 .................................................................................................................................................... 10 38940 

100292 .................................................................................................................................................... 10 23020 LUGAR 

110001 .................................................................................................................................................... 19140 12060 

110002 .................................................................................................................................................... 11 12060 

110003 .................................................................................................................................................... 11 27260 

110023 .................................................................................................................................................... 11 12060 

110025 .................................................................................................................................................... 15260 27260 

110029 .................................................................................................................................................... 23580 12060 

110038 .................................................................................................................................................... 11 45220 

110040 .................................................................................................................................................... 11 12060 LUGAR 

110041 .................................................................................................................................................... 11 12020 

110052 .................................................................................................................................................... 11 16860 LUGAR 

110054 .................................................................................................................................................... 40660 12060 

110069 .................................................................................................................................................... 47580 31420 

110075 .................................................................................................................................................... 11 42340 

110088 .................................................................................................................................................... 11 12060 LUGAR 

110095 .................................................................................................................................................... 11 46660 

110117 .................................................................................................................................................... 11 12060 LUGAR 

110122 .................................................................................................................................................... 46660 45220 

110125 .................................................................................................................................................... 11 31420 

110128 .................................................................................................................................................... 11 42340 

110150 .................................................................................................................................................... 11 31420 

110153 .................................................................................................................................................... 47580 31420 

110168 .................................................................................................................................................... 40660 12060 

110187 .................................................................................................................................................... 11 12060 LUGAR 

110189 .................................................................................................................................................... 11 12060 

110205 .................................................................................................................................................... 11 12060 

120028 .................................................................................................................................................... 12 26180 

130002 .................................................................................................................................................... 13 14260 

130003 .................................................................................................................................................... 30300 50 

130049 .................................................................................................................................................... 17660 44060 

140012 .................................................................................................................................................... 14 16974 

140015 .................................................................................................................................................... 14 41180 

140032 .................................................................................................................................................... 14 41180 

140034 .................................................................................................................................................... 14 41180 

140040 .................................................................................................................................................... 14 37900 

140043 .................................................................................................................................................... 14 40420 

140046 .................................................................................................................................................... 14 41180 

140058 .................................................................................................................................................... 14 41180 

140061 .................................................................................................................................................... 14 41180 

140064 .................................................................................................................................................... 14 37900 

140110 .................................................................................................................................................... 14 16974 

140143 .................................................................................................................................................... 14 37900 

140160 .................................................................................................................................................... 14 40420 

140161 .................................................................................................................................................... 14 16974 

140164 .................................................................................................................................................... 14 41180 

140189 .................................................................................................................................................... 14 16580 

140233 .................................................................................................................................................... 40420 16974 

140234 .................................................................................................................................................... 14 37900 

140236 .................................................................................................................................................... 14 28100 LUGAR 

140291 .................................................................................................................................................... 29404 16974 

150002 .................................................................................................................................................... 23844 16974 

150004 .................................................................................................................................................... 23844 16974 

150006 .................................................................................................................................................... 33140 43780 

23632 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

TABLE 9A.—HOSPITALS RECLASSIFICATIONS AND REDESIGNATIONS BY INDIVIDUAL HOSPITALS AND CBSA—FY 2006—

Continued 

Provider number Geographic 

CBSA 

Reclassified 

CBSA Lugar 

150008 .................................................................................................................................................... 23844 16974 

150011 .................................................................................................................................................... 15 26900 

150015 .................................................................................................................................................... 33140 16974 

150030 .................................................................................................................................................... 15 26900 LUGAR 

150048 .................................................................................................................................................... 15 17140 

150065 .................................................................................................................................................... 15 26900 

150069 .................................................................................................................................................... 15 17140 

150076 .................................................................................................................................................... 15 43780 

150088 .................................................................................................................................................... 11300 26900 

150090 .................................................................................................................................................... 23844 16974 

150102 .................................................................................................................................................... 15 23844 LUGAR 

150112 .................................................................................................................................................... 18020 26900 

150113 .................................................................................................................................................... 11300 26900 

150125 .................................................................................................................................................... 23844 16974 

150126 .................................................................................................................................................... 23844 16974 

150132 .................................................................................................................................................... 23844 16974 

150133 .................................................................................................................................................... 15 23060 

150146 .................................................................................................................................................... 15 23060 

150147 .................................................................................................................................................... 23844 16974 

160001 .................................................................................................................................................... 16 11180 

160016 .................................................................................................................................................... 16 19780 

160026 .................................................................................................................................................... 16 11180 LUGAR 

160057 .................................................................................................................................................... 16 26980 

160080 .................................................................................................................................................... 16 40420 

160089 .................................................................................................................................................... 16 19780 

160147 .................................................................................................................................................... 16 11180 

170006 .................................................................................................................................................... 17 27900 

170010 .................................................................................................................................................... 17 46140 

170012 .................................................................................................................................................... 17 48620 

170013 .................................................................................................................................................... 17 48620 

170020 .................................................................................................................................................... 17 48620 

170022 .................................................................................................................................................... 17 28140 

170023 .................................................................................................................................................... 17 48620 

170033 .................................................................................................................................................... 17 48620 

170058 .................................................................................................................................................... 17 28140 

170068 .................................................................................................................................................... 17 11100 

170120 .................................................................................................................................................... 17 27900 

170142 .................................................................................................................................................... 17 45820 

170175 .................................................................................................................................................... 17 48620 

180005 .................................................................................................................................................... 18 26580 

180011 .................................................................................................................................................... 18 30460 

180012 .................................................................................................................................................... 21060 31140 

180013 .................................................................................................................................................... 14540 34980 

180017 .................................................................................................................................................... 18 21060 

180018 .................................................................................................................................................... 18 30460 

180019 .................................................................................................................................................... 18 17140 

180024 .................................................................................................................................................... 18 31140 

180027 .................................................................................................................................................... 18 17300 

180028 .................................................................................................................................................... 18 26580 

180029 .................................................................................................................................................... 18 28700 

180044 .................................................................................................................................................... 18 26580 

180048 .................................................................................................................................................... 18 31140 

180066 .................................................................................................................................................... 18 34980 

180069 .................................................................................................................................................... 18 26580 

180075 .................................................................................................................................................... 18 14540 LUGAR 

180078 .................................................................................................................................................... 18 26580 

180080 .................................................................................................................................................... 18 28940 

180093 .................................................................................................................................................... 18 21780 

180102 .................................................................................................................................................... 18 17300 

180104 .................................................................................................................................................... 18 17300 

180116 .................................................................................................................................................... 18 14 

180124 .................................................................................................................................................... 14540 34980 

180127 .................................................................................................................................................... 18 31140 

180132 .................................................................................................................................................... 18 30460 

180139 .................................................................................................................................................... 18 30460 

190001 .................................................................................................................................................... 19 35380 

190003 .................................................................................................................................................... 19 29180 

190015 .................................................................................................................................................... 19 35380 

190086 .................................................................................................................................................... 19 43340 

190099 .................................................................................................................................................... 19 12940 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23633 

TABLE 9A.—HOSPITALS RECLASSIFICATIONS AND REDESIGNATIONS BY INDIVIDUAL HOSPITALS AND CBSA—FY 2006—

Continued 

Provider number Geographic 

CBSA 

Reclassified 

CBSA Lugar 

190106 .................................................................................................................................................... 19 10780 

190131 .................................................................................................................................................... 12940 35380 

190155 .................................................................................................................................................... 19 12940 LUGAR 

190164 .................................................................................................................................................... 19 10780 

190191 .................................................................................................................................................... 19 12940 

190223 .................................................................................................................................................... 19 12940 LUGAR 

200002 .................................................................................................................................................... 20 38860 

200020 .................................................................................................................................................... 38860 40484 

200024 .................................................................................................................................................... 30340 38860 

200034 .................................................................................................................................................... 30340 38860 

200039 .................................................................................................................................................... 20 38860 

200050 .................................................................................................................................................... 20 12620 

200063 .................................................................................................................................................... 20 38860 

220001 .................................................................................................................................................... 49340 14484 

220002 .................................................................................................................................................... 15764 14484 

220003 .................................................................................................................................................... 49340 14484 

220010 .................................................................................................................................................... 21604 14484 

220011 .................................................................................................................................................... 15764 14484 

220019 .................................................................................................................................................... 49340 14484 

220025 .................................................................................................................................................... 49340 14484 

220028 .................................................................................................................................................... 49340 14484 

220029 .................................................................................................................................................... 21604 14484 

220033 .................................................................................................................................................... 21604 14484 

220035 .................................................................................................................................................... 21604 14484 

220049 .................................................................................................................................................... 15764 14484 

220058 .................................................................................................................................................... 49340 14484 

220060 .................................................................................................................................................... 14484 12700 

220062 .................................................................................................................................................... 49340 14484 

220063 .................................................................................................................................................... 15764 14484 

220070 .................................................................................................................................................... 15764 14484 

220077 .................................................................................................................................................... 44140 25540 

220080 .................................................................................................................................................... 21604 14484 

220082 .................................................................................................................................................... 15764 14484 

220084 .................................................................................................................................................... 15764 14484 

220089 .................................................................................................................................................... 15764 14484 

220090 .................................................................................................................................................... 49340 14484 

220095 .................................................................................................................................................... 49340 14484 

220098 .................................................................................................................................................... 15764 14484 

220101 .................................................................................................................................................... 15764 14484 

220105 .................................................................................................................................................... 15764 14484 

220133 .................................................................................................................................................... 15764 14484 

220163 .................................................................................................................................................... 49340 14484 

220171 .................................................................................................................................................... 15764 14484 

220174 .................................................................................................................................................... 21604 14484 

230022 .................................................................................................................................................... 23 11460 

230030 .................................................................................................................................................... 23 40980 

230035 .................................................................................................................................................... 23 24340 LUGAR 

230037 .................................................................................................................................................... 23 11460 

230042 .................................................................................................................................................... 23 26100 LUGAR 

230047 .................................................................................................................................................... 47644 19804 

230054 .................................................................................................................................................... 23 24580 

230069 .................................................................................................................................................... 47644 22420 

230077 .................................................................................................................................................... 40980 22420 

230080 .................................................................................................................................................... 23 40980 

230093 .................................................................................................................................................... 23 24340 

230096 .................................................................................................................................................... 23 28020 

230099 .................................................................................................................................................... 33780 11460 

230105 .................................................................................................................................................... 23 13020 

230121 .................................................................................................................................................... 23 29620 LUGAR 

230134 .................................................................................................................................................... 23 26100 LUGAR 

230195 .................................................................................................................................................... 47644 19804 

230204 .................................................................................................................................................... 47644 19804 

230208 .................................................................................................................................................... 23 24340 LUGAR 

230217 .................................................................................................................................................... 12980 29620 

230227 .................................................................................................................................................... 47644 19804 

230235 .................................................................................................................................................... 23 40980 LUGAR 

230257 .................................................................................................................................................... 47644 19804 

230264 .................................................................................................................................................... 47644 19804 

230279 .................................................................................................................................................... 47644 22420 

230295 .................................................................................................................................................... 23 26100 LUGAR 

23634 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

TABLE 9A.—HOSPITALS RECLASSIFICATIONS AND REDESIGNATIONS BY INDIVIDUAL HOSPITALS AND CBSA—FY 2006—

Continued 

Provider number Geographic 

CBSA 

Reclassified 

CBSA Lugar 

240013 .................................................................................................................................................... 24 33460 

240018 .................................................................................................................................................... 24 33460 

240030 .................................................................................................................................................... 24 41060 

240031 .................................................................................................................................................... 41060 33460 

240036 .................................................................................................................................................... 41060 33460 

240052 .................................................................................................................................................... 24 22020 

240064 .................................................................................................................................................... 24 20260 

240069 .................................................................................................................................................... 24 40340 

240071 .................................................................................................................................................... 24 40340 

240075 .................................................................................................................................................... 24 41060 

240088 .................................................................................................................................................... 24 41060 

240093 .................................................................................................................................................... 24 33460 

240105 .................................................................................................................................................... 24 40340 LUGAR 

240150 .................................................................................................................................................... 24 40340 LUGAR 

240152 .................................................................................................................................................... 24 33460 

240187 .................................................................................................................................................... 24 33460 

240211 .................................................................................................................................................... 24 33460 

250004 .................................................................................................................................................... 25 32820 

250006 .................................................................................................................................................... 25 32820 

250009 .................................................................................................................................................... 25 27180 

250023 .................................................................................................................................................... 25 25060 LUGAR 

250031 .................................................................................................................................................... 25 27140 

250034 .................................................................................................................................................... 25 32820 

250040 .................................................................................................................................................... 37700 25060 

250042 .................................................................................................................................................... 25 32820 

250069 .................................................................................................................................................... 25 46220 

250079 .................................................................................................................................................... 25 27140 

250081 .................................................................................................................................................... 25 27140 

250082 .................................................................................................................................................... 25 38220 

250094 .................................................................................................................................................... 25620 25060 

250097 .................................................................................................................................................... 25 12940 

250099 .................................................................................................................................................... 25 27140 

250100 .................................................................................................................................................... 25 46220 

250104 .................................................................................................................................................... 25 27140 

250117 .................................................................................................................................................... 25 25060 LUGAR 

260009 .................................................................................................................................................... 26 28140 

260011 .................................................................................................................................................... 27620 17860 

260017 .................................................................................................................................................... 26 41180 

260022 .................................................................................................................................................... 26 16 

260025 .................................................................................................................................................... 26 41180 

260047 .................................................................................................................................................... 27620 17860 

260049 .................................................................................................................................................... 26 44180 LUGAR 

260064 .................................................................................................................................................... 26 17860 

260074 .................................................................................................................................................... 126 17860 

260094 .................................................................................................................................................... 26 44180 

260110 .................................................................................................................................................... 26 41180 

260113 .................................................................................................................................................... 26 14 

260116 .................................................................................................................................................... 26 14 

260183 .................................................................................................................................................... 26 41180 

260186 .................................................................................................................................................... 26 17860 

270003 .................................................................................................................................................... 27 24500 

270011 .................................................................................................................................................... 27 24500 

270017 .................................................................................................................................................... 27 33540 

270051 .................................................................................................................................................... 27 33540 

280009 .................................................................................................................................................... 28 30700 

280023 .................................................................................................................................................... 28 30700 

280032 .................................................................................................................................................... 28 30700 

280057 .................................................................................................................................................... 28 30700 

280061 .................................................................................................................................................... 28 53 

280065 .................................................................................................................................................... 28 24540 

280077 .................................................................................................................................................... 28 36540 

290002 .................................................................................................................................................... 29 16180 LUGAR 

290006 .................................................................................................................................................... 29 39900 

290008 .................................................................................................................................................... 29 29820 

290019 .................................................................................................................................................... 16180 39900 

300003 .................................................................................................................................................... 30 31700 

300005 .................................................................................................................................................... 30 31700 

300007 .................................................................................................................................................... 31700 15764 

300011 .................................................................................................................................................... 31700 15764 

300012 .................................................................................................................................................... 31700 15764 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23635 

TABLE 9A.—HOSPITALS RECLASSIFICATIONS AND REDESIGNATIONS BY INDIVIDUAL HOSPITALS AND CBSA—FY 2006—

Continued 

Provider number Geographic 

CBSA 

Reclassified 

CBSA Lugar 

300014 .................................................................................................................................................... 40484 31700 

300017 .................................................................................................................................................... 40484 21604 

300018 .................................................................................................................................................... 40484 31700 

300019 .................................................................................................................................................... 30 15764 

300020 .................................................................................................................................................... 31700 15764 

300023 .................................................................................................................................................... 40484 21604 

300029 .................................................................................................................................................... 40484 21604 

300034 .................................................................................................................................................... 31700 15764 

310002 .................................................................................................................................................... 35084 35644 

310009 .................................................................................................................................................... 35084 35644 

310013 .................................................................................................................................................... 35084 35644 

310015 .................................................................................................................................................... 35084 35644 

310018 .................................................................................................................................................... 35084 35644 

310031 .................................................................................................................................................... 15804 20764 

310032 .................................................................................................................................................... 47220 48864 

310038 .................................................................................................................................................... 20764 35644 

310048 .................................................................................................................................................... 20764 35084 

310054 .................................................................................................................................................... 35084 35644 

310070 .................................................................................................................................................... 20764 35644 

310076 .................................................................................................................................................... 35084 35644 

310078 .................................................................................................................................................... 35084 35644 

310083 .................................................................................................................................................... 35084 35644 

310093 .................................................................................................................................................... 35084 35644 

310096 .................................................................................................................................................... 35084 35644 

310119 .................................................................................................................................................... 35084 35644 

320005 .................................................................................................................................................... 22140 10740 

320006 .................................................................................................................................................... 32 42140 

320013 .................................................................................................................................................... 32 42140 

320014 .................................................................................................................................................... 32 29740 

320033 .................................................................................................................................................... 32 42140 LUGAR 

320063 .................................................................................................................................................... 32 36220 

320065 .................................................................................................................................................... 32 36220 

330001 .................................................................................................................................................... 39100 35644 

330004 .................................................................................................................................................... 28740 39100 

330008 .................................................................................................................................................... 33 15380 LUGAR 

330027 .................................................................................................................................................... 35004 35644 

330038 .................................................................................................................................................... 33 40380 LUGAR 

330062 .................................................................................................................................................... 33 27060 LUGAR 

330073 .................................................................................................................................................... 33 40380 LUGAR 

330085 .................................................................................................................................................... 33 45060 

330094 .................................................................................................................................................... 33 28740 

330136 .................................................................................................................................................... 33 45060 

330157 .................................................................................................................................................... 33 45060 

330181 .................................................................................................................................................... 35004 35644 

330182 .................................................................................................................................................... 35004 35644 

330191 .................................................................................................................................................... 24020 10580 

330229 .................................................................................................................................................... 27460 21500 

330235 .................................................................................................................................................... 33 45060 LUGAR 

330239 .................................................................................................................................................... 27460 21500 

330250 .................................................................................................................................................... 33 15540 

330277 .................................................................................................................................................... 33 27060 

330359 .................................................................................................................................................... 33 39100 LUGAR 

330386 .................................................................................................................................................... 33 39100 LUGAR 

340004 .................................................................................................................................................... 24660 49180 

340008 .................................................................................................................................................... 34 16740 

340010 .................................................................................................................................................... 24140 39580 

340013 .................................................................................................................................................... 34 16740 

340018 .................................................................................................................................................... 34 43900 LUGAR 

340021 .................................................................................................................................................... 34 16740 

340023 .................................................................................................................................................... 11700 24860 

340027 .................................................................................................................................................... 34 24780 

340039 .................................................................................................................................................... 34 16740 

340050 .................................................................................................................................................... 34 22180 

340051 .................................................................................................................................................... 34 25860 

340068 .................................................................................................................................................... 34 48900 

340069 .................................................................................................................................................... 39580 20500 

340071 .................................................................................................................................................... 34 39580 LUGAR 

340073 .................................................................................................................................................... 39580 20500 

340091 .................................................................................................................................................... 24660 49180 

340109 .................................................................................................................................................... 34 47260 

23636 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

TABLE 9A.—HOSPITALS RECLASSIFICATIONS AND REDESIGNATIONS BY INDIVIDUAL HOSPITALS AND CBSA—FY 2006—

Continued 

Provider number Geographic 

CBSA 

Reclassified 

CBSA Lugar 

340114 .................................................................................................................................................... 39580 20500 

340115 .................................................................................................................................................... 34 20500 

340124 .................................................................................................................................................... 34 39580 LUGAR 

340127 .................................................................................................................................................... 34 20500 LUGAR 

340129 .................................................................................................................................................... 34 16740 

340131 .................................................................................................................................................... 34 24780 

340136 .................................................................................................................................................... 34 20500 LUGAR 

340138 .................................................................................................................................................... 39580 20500 

340144 .................................................................................................................................................... 34 16740 

340145 .................................................................................................................................................... 34 16740 LUGAR 

340147 .................................................................................................................................................... 40580 39580 

340173 .................................................................................................................................................... 39580 20500 

350009 .................................................................................................................................................... 35 22020 

360008 .................................................................................................................................................... 36 26580 

360010 .................................................................................................................................................... 36 10420 

360011 .................................................................................................................................................... 36 18140 

360013 .................................................................................................................................................... 36 30620 

360014 .................................................................................................................................................... 36 18140 

360019 .................................................................................................................................................... 10420 17460 

360020 .................................................................................................................................................... 10420 17460 

360025 .................................................................................................................................................... 41780 17460 

360027 .................................................................................................................................................... 10420 17460 

360036 .................................................................................................................................................... 36 17460 

360039 .................................................................................................................................................... 36 18140 

360054 .................................................................................................................................................... 36 16620 

360065 .................................................................................................................................................... 36 17460 

360078 .................................................................................................................................................... 10420 17460 

360079 .................................................................................................................................................... 19380 17140 

360086 .................................................................................................................................................... 44220 19380 

360096 .................................................................................................................................................... 36 49660 LUGAR 

360107 .................................................................................................................................................... 36 17460 

360112 .................................................................................................................................................... 45780 11460 

360125 .................................................................................................................................................... 36 17460 LUGAR 

360150 .................................................................................................................................................... 10420 17460 

360159 .................................................................................................................................................... 36 18140 

360175 .................................................................................................................................................... 36 18140 

360185 .................................................................................................................................................... 36 49660 LUGAR 

360187 .................................................................................................................................................... 44220 19380 

360197 .................................................................................................................................................... 36 18140 

360211 .................................................................................................................................................... 48260 38300 

360238 .................................................................................................................................................... 36 49660 LUGAR 

360241 .................................................................................................................................................... 10420 17460 

360245 .................................................................................................................................................... 36 17460 LUGAR 

370004 .................................................................................................................................................... 37 27900 

370014 .................................................................................................................................................... 37 43300 

370015 .................................................................................................................................................... 37 46140 

370018 .................................................................................................................................................... 37 46140 

370022 .................................................................................................................................................... 37 30020 

370025 .................................................................................................................................................... 37 46140 

370034 .................................................................................................................................................... 37 22900 

370047 .................................................................................................................................................... 37 43300 

370049 .................................................................................................................................................... 37 36420 

370099 .................................................................................................................................................... 37 46140 

370103 .................................................................................................................................................... 37 45 

370113 .................................................................................................................................................... 37 22220 

370179 .................................................................................................................................................... 37 46140 

380001 .................................................................................................................................................... 38 38900 

380008 .................................................................................................................................................... 38 18700 LUGAR 

380022 .................................................................................................................................................... 38 18700 LUGAR 

380027 .................................................................................................................................................... 38 21660 

380047 .................................................................................................................................................... 13460 21660 

380050 .................................................................................................................................................... 38 32780 

380070 .................................................................................................................................................... 38 38900 

390006 .................................................................................................................................................... 39 25420 

390013 .................................................................................................................................................... 39 25420 

390016 .................................................................................................................................................... 39 49660 

390030 .................................................................................................................................................... 39 10900 

390031 .................................................................................................................................................... 39 39740 LUGAR 

390048 .................................................................................................................................................... 39 25420 

390052 .................................................................................................................................................... 39 11020 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23637 

TABLE 9A.—HOSPITALS RECLASSIFICATIONS AND REDESIGNATIONS BY INDIVIDUAL HOSPITALS AND CBSA—FY 2006—

Continued 

Provider number Geographic 

CBSA 

Reclassified 

CBSA Lugar 

390065 .................................................................................................................................................... 39 47894 

390066 .................................................................................................................................................... 30140 25420 

390071 .................................................................................................................................................... 39 48700 LUGAR 

390079 .................................................................................................................................................... 39 13780 

390081 .................................................................................................................................................... 37964 48864 

390086 .................................................................................................................................................... 39 44300 

390091 .................................................................................................................................................... 39 49660 

390093 .................................................................................................................................................... 39 49660 

390110 .................................................................................................................................................... 27780 38300 

390113 .................................................................................................................................................... 39 49660 

390133 .................................................................................................................................................... 10900 37964 

390138 .................................................................................................................................................... 39 47894 

390150 .................................................................................................................................................... 39 38300 LUGAR 

390151 .................................................................................................................................................... 39 47894 

390156 .................................................................................................................................................... 37964 48864 

390180 .................................................................................................................................................... 37964 48864 

390222 .................................................................................................................................................... 37964 48864 

390224 .................................................................................................................................................... 39 13780 LUGAR 

390244 .................................................................................................................................................... 39 48700 LUGAR 

390246 .................................................................................................................................................... 39 48700 

390249 .................................................................................................................................................... 39 13780 LUGAR 

400048 .................................................................................................................................................... 25020 41980 

410001 .................................................................................................................................................... 39300 14484 

410004 .................................................................................................................................................... 39300 14484 

410005 .................................................................................................................................................... 39300 14484 

410006 .................................................................................................................................................... 39300 14484 

410007 .................................................................................................................................................... 39300 14484 

410008 .................................................................................................................................................... 39300 14484 

410009 .................................................................................................................................................... 39300 14484 

410011 .................................................................................................................................................... 39300 14484 

410012 .................................................................................................................................................... 39300 14484 

410013 .................................................................................................................................................... 39300 14484 

420009 .................................................................................................................................................... 42 24860 LUGAR 

420020 .................................................................................................................................................... 42 16700 

420028 .................................................................................................................................................... 42 44940 LUGAR 

420030 .................................................................................................................................................... 42 16700 

420036 .................................................................................................................................................... 42 16740 

420039 .................................................................................................................................................... 42 43900 LUGAR 

420067 .................................................................................................................................................... 42 42340 

420068 .................................................................................................................................................... 42 16700 

420069 .................................................................................................................................................... 42 44940 LUGAR 

420070 .................................................................................................................................................... 44940 17900 

420071 .................................................................................................................................................... 42 24860 

420080 .................................................................................................................................................... 42 42340 

420085 .................................................................................................................................................... 34820 48900 

430012 .................................................................................................................................................... 43 43620 

430014 .................................................................................................................................................... 43 22020 

430094 .................................................................................................................................................... 43 53 

440008 .................................................................................................................................................... 44 21780 

440020 .................................................................................................................................................... 44 26620 

440035 .................................................................................................................................................... 17300 34980 

440050 .................................................................................................................................................... 44 11700 

440058 .................................................................................................................................................... 44 16860 

440059 .................................................................................................................................................... 44 34980 

440060 .................................................................................................................................................... 44 27180 

440067 .................................................................................................................................................... 34100 28940 

440068 .................................................................................................................................................... 44 16860 

440072 .................................................................................................................................................... 44 32820 

440073 .................................................................................................................................................... 44 34980 

440148 .................................................................................................................................................... 44 34980 

440151 .................................................................................................................................................... 44 34980 

440175 .................................................................................................................................................... 44 34980 

440180 .................................................................................................................................................... 44 28940 

440185 .................................................................................................................................................... 17420 16860 

440192 .................................................................................................................................................... 44 34980 

450007 .................................................................................................................................................... 45 41700 

450032 .................................................................................................................................................... 45 43340 

450039 .................................................................................................................................................... 23104 19124 

450059 .................................................................................................................................................... 41700 12420 

450064 .................................................................................................................................................... 23104 19124 

23638 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

TABLE 9A.—HOSPITALS RECLASSIFICATIONS AND REDESIGNATIONS BY INDIVIDUAL HOSPITALS AND CBSA—FY 2006—

Continued 

Provider number Geographic 

CBSA 

Reclassified 

CBSA Lugar 

450073 .................................................................................................................................................... 45 10180 

450080 .................................................................................................................................................... 45 30980 

450087 .................................................................................................................................................... 23104 19124 

450098 .................................................................................................................................................... 45 30980 

450099 .................................................................................................................................................... 45 11100 

450121 .................................................................................................................................................... 23104 19124 

450135 .................................................................................................................................................... 23104 19124 

450137 .................................................................................................................................................... 23104 19124 

450144 .................................................................................................................................................... 45 36220 

450148 .................................................................................................................................................... 23104 19124 

450187 .................................................................................................................................................... 45 26420 

450192 .................................................................................................................................................... 45 19124 

450194 .................................................................................................................................................... 45 19124 

450196 .................................................................................................................................................... 45 19124 

450211 .................................................................................................................................................... 45 26420 

450214 .................................................................................................................................................... 45 26420 

450224 .................................................................................................................................................... 45 46340 

450283 .................................................................................................................................................... 45 19124 LUGAR 

450286 .................................................................................................................................................... 45 17780 LUGAR 

450347 .................................................................................................................................................... 45 26420 

450351 .................................................................................................................................................... 45 23104 

450389 .................................................................................................................................................... 45 19124 LUGAR 

450400 .................................................................................................................................................... 45 47380 

450419 .................................................................................................................................................... 23104 19124 

450438 .................................................................................................................................................... 45 26420 

450447 .................................................................................................................................................... 45 19124 

450451 .................................................................................................................................................... 45 23104 

450484 .................................................................................................................................................... 45 26420 

450508 .................................................................................................................................................... 45 46340 

450547 .................................................................................................................................................... 45 19124 

450563 .................................................................................................................................................... 23104 19124 

450623 .................................................................................................................................................... 45 19124 LUGAR 

450639 .................................................................................................................................................... 23104 19124 

450653 .................................................................................................................................................... 45 33260 

450656 .................................................................................................................................................... 45 46340 

450672 .................................................................................................................................................... 23104 19124 

450675 .................................................................................................................................................... 23104 19124 

450677 .................................................................................................................................................... 23104 19124 

450694 .................................................................................................................................................... 45 26420 

450747 .................................................................................................................................................... 45 19124 

450755 .................................................................................................................................................... 45 31180 

450770 .................................................................................................................................................... 45 12420 LUGAR 

450779 .................................................................................................................................................... 23104 19124 

450830 .................................................................................................................................................... 45 36220 

450839 .................................................................................................................................................... 45 43340 

450858 .................................................................................................................................................... 23104 19124 

450872 .................................................................................................................................................... 23104 19124 

450880 .................................................................................................................................................... 23104 19124 

460004 .................................................................................................................................................... 36260 41620 

460005 .................................................................................................................................................... 36260 41620 

460007 .................................................................................................................................................... 46 41100 

460011 .................................................................................................................................................... 46 39340 

460021 .................................................................................................................................................... 41100 29820 

460036 .................................................................................................................................................... 46 39340 

460039 .................................................................................................................................................... 46 36260 

460041 .................................................................................................................................................... 36260 41620 

460042 .................................................................................................................................................... 36260 41620 

470001 .................................................................................................................................................... 47 30 

470011 .................................................................................................................................................... 47 15764 

470012 .................................................................................................................................................... 47 38340 

490004 .................................................................................................................................................... 25500 16820 

490005 .................................................................................................................................................... 49020 47894 

490006 .................................................................................................................................................... 49 49020 LUGAR 

490013 .................................................................................................................................................... 49 31340 

490018 .................................................................................................................................................... 49 16820 

490047 .................................................................................................................................................... 49 25500 LUGAR 

490079 .................................................................................................................................................... 49 49180 

490092 .................................................................................................................................................... 49 40060 

490105 .................................................................................................................................................... 49 28700 

490106 .................................................................................................................................................... 49 16820 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23639 

TABLE 9A.—HOSPITALS RECLASSIFICATIONS AND REDESIGNATIONS BY INDIVIDUAL HOSPITALS AND CBSA—FY 2006—

Continued 

Provider number Geographic 

CBSA 

Reclassified 

CBSA Lugar 

490109 .................................................................................................................................................... 47260 40060 

500002 .................................................................................................................................................... 50 28420 

500003 .................................................................................................................................................... 34580 42644 

500016 .................................................................................................................................................... 48300 42644 

500024 .................................................................................................................................................... 36500 45104 

500031 .................................................................................................................................................... 50 36500 

500039 .................................................................................................................................................... 14740 42644 

500041 .................................................................................................................................................... 31020 38900 

500072 .................................................................................................................................................... 50 42644 

500139 .................................................................................................................................................... 36500 45104 

500143 .................................................................................................................................................... 36500 45104 

510001 .................................................................................................................................................... 34060 38300 

510002 .................................................................................................................................................... 51 40220 

510006 .................................................................................................................................................... 51 38300 

510018 .................................................................................................................................................... 51 16620 LUGAR 

510024 .................................................................................................................................................... 34060 38300 

510028 .................................................................................................................................................... 51 16620 

510030 .................................................................................................................................................... 51 34060 

510046 .................................................................................................................................................... 51 16620 

510047 .................................................................................................................................................... 51 38300 

510070 .................................................................................................................................................... 51 16620 

510071 .................................................................................................................................................... 51 16620 

510077 .................................................................................................................................................... 51 26580 

520002 .................................................................................................................................................... 52 48140 

520021 .................................................................................................................................................... 29404 16974 

520028 .................................................................................................................................................... 52 31540 LUGAR 

520037 .................................................................................................................................................... 52 48140 

520059 .................................................................................................................................................... 39540 29404 

520060 .................................................................................................................................................... 52 22540 LUGAR 

520066 .................................................................................................................................................... 27500 31540 

520071 .................................................................................................................................................... 52 33340 LUGAR 

520076 .................................................................................................................................................... 52 31540 

520088 .................................................................................................................................................... 22540 33340 

520094 .................................................................................................................................................... 39540 33340 

520095 .................................................................................................................................................... 52 31540 

520096 .................................................................................................................................................... 39540 33340 

520102 .................................................................................................................................................... 52 33340 LUGAR 

520107 .................................................................................................................................................... 52 24580 

520113 .................................................................................................................................................... 52 24580 

520116 .................................................................................................................................................... 52 33340 LUGAR 

520152 .................................................................................................................................................... 52 24580 

520173 .................................................................................................................................................... 52 20260 

520189 .................................................................................................................................................... 29404 16974 

530002 .................................................................................................................................................... 53 16220 

530025 .................................................................................................................................................... 53 22660 

TABLE 9B.—HOSPITAL RECLASSIFICATIONS AND REDESIGNATIONS BY INDIVIDUAL HOSPITAL UNDER SECTION 508 OF PUB. 

L. 108–173 

Provider number Geographic 

CBSA 

Wage index 

CBSA 508 

reclassification 

Own wage 

index 

010150 ......................................................................................................................................... 01 17980 ........................

020008 ......................................................................................................................................... 02 ........................ 1.2841 

050494 ......................................................................................................................................... 05 42220 ........................

050549 ......................................................................................................................................... 37100 42220 ........................

060057 ......................................................................................................................................... 06 19740 ........................

060075 ......................................................................................................................................... 06 ........................ 1.1709 

070001 ......................................................................................................................................... 35300 35004 ........................

070005 ......................................................................................................................................... 35300 35004 ........................

070010 ......................................................................................................................................... 14860 35644 ........................

070016 ......................................................................................................................................... 35300 35004 ........................

070017 ......................................................................................................................................... 35300 35004 ........................

070019 ......................................................................................................................................... 35300 35004 ........................

070022 ......................................................................................................................................... 35300 35004 ........................

070028 ......................................................................................................................................... 14860 35644 ........................

070031 ......................................................................................................................................... 35300 35004 ........................

070036 ......................................................................................................................................... 25540 ........................ 1.2926 

23640 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

TABLE 9B.—HOSPITAL RECLASSIFICATIONS AND REDESIGNATIONS BY INDIVIDUAL HOSPITAL UNDER SECTION 508 OF PUB. 

L. 108–173—Continued 

Provider number Geographic 

CBSA 

Wage index 

CBSA 508 

reclassification 

Own wage 

index 

070039 ......................................................................................................................................... 35300 35004 ........................

120025 ......................................................................................................................................... 12 26180 ........................

150034 ......................................................................................................................................... 23844 16974 ........................

160040 ......................................................................................................................................... 47940 16300 ........................

160064 ......................................................................................................................................... 16 ........................ 1.0228 

160067 ......................................................................................................................................... 47940 16300 ........................

160110 ......................................................................................................................................... 47940 16300 ........................

190218 ......................................................................................................................................... 19 43340 ........................

220046 ......................................................................................................................................... 38340 14484 ........................

230003 ......................................................................................................................................... 26100 28020 ........................

230004 ......................................................................................................................................... 34740 28020 ........................

230013 ......................................................................................................................................... 47644 22420 ........................

230019 ......................................................................................................................................... 47644 22420 ........................

230020 ......................................................................................................................................... 19804 11460 ........................

230024 ......................................................................................................................................... 19804 11460 ........................

230029 ......................................................................................................................................... 47644 22420 ........................

230036 ......................................................................................................................................... 23 22420 ........................

230038 ......................................................................................................................................... 24340 28020 ........................

230053 ......................................................................................................................................... 19804 11460 ........................

230059 ......................................................................................................................................... 24340 28020 ........................

230066 ......................................................................................................................................... 34740 28020 ........................

230071 ......................................................................................................................................... 47644 22420 ........................

230072 ......................................................................................................................................... 26100 28020 ........................

230089 ......................................................................................................................................... 19804 11460 ........................

230092 ......................................................................................................................................... 27100 24340 ........................

230097 ......................................................................................................................................... 23 28020 ........................

230104 ......................................................................................................................................... 19804 11460 ........................

230106 ......................................................................................................................................... 24340 28020 ........................

230119 ......................................................................................................................................... 19804 11460 ........................

230130 ......................................................................................................................................... 47644 22420 ........................

230135 ......................................................................................................................................... 19804 11460 ........................

230146 ......................................................................................................................................... 19804 11460 ........................

230151 ......................................................................................................................................... 47644 22420 ........................

230165 ......................................................................................................................................... 19804 11460 ........................

230174 ......................................................................................................................................... 26100 28020 ........................

230176 ......................................................................................................................................... 19804 11460 ........................

230207 ......................................................................................................................................... 47644 22420 ........................

230223 ......................................................................................................................................... 47644 22420 ........................

230236 ......................................................................................................................................... 24340 28020 ........................

230254 ......................................................................................................................................... 47644 22420 ........................

230269 ......................................................................................................................................... 47644 22420 ........................

230270 ......................................................................................................................................... 19804 11460 ........................

230273 ......................................................................................................................................... 19804 11460 ........................

230277 ......................................................................................................................................... 47644 22420 ........................

250002 ......................................................................................................................................... 25 25060 ........................

250122 ......................................................................................................................................... 25 25060 ........................

270021 ......................................................................................................................................... 27 13740 ........................

270023 ......................................................................................................................................... 33540 13740 ........................

270032 ......................................................................................................................................... 27 13740 ........................

270050 ......................................................................................................................................... 27 13740 ........................

270057 ......................................................................................................................................... 27 13740 ........................

310021 ......................................................................................................................................... 45940 35644 ........................

310028 ......................................................................................................................................... 35084 35644 ........................

310050 ......................................................................................................................................... 35084 35644 ........................

310051 ......................................................................................................................................... 35084 35644 ........................

310060 ......................................................................................................................................... 10900 35644 ........................

310115 ......................................................................................................................................... 10900 35644 ........................

310120 ......................................................................................................................................... 35084 35644 ........................

330049 ......................................................................................................................................... 39100 35644 ........................

330067 ......................................................................................................................................... 39100 35300 ........................

330106 ......................................................................................................................................... 35004 ........................ 1.4734 

330126 ......................................................................................................................................... 39100 35644 ........................

330135 ......................................................................................................................................... 39100 35644 ........................

330205 ......................................................................................................................................... 39100 35644 ........................

330264 ......................................................................................................................................... 39100 35004 ........................

340002 ......................................................................................................................................... 11700 16740 ........................

350002 ......................................................................................................................................... 13900 22020 ........................

350003 ......................................................................................................................................... 35 22020 ........................

350006 ......................................................................................................................................... 35 22020 ........................

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23641 

TABLE 9B.—HOSPITAL RECLASSIFICATIONS AND REDESIGNATIONS BY INDIVIDUAL HOSPITAL UNDER SECTION 508 OF PUB. 

L. 108–173—Continued 

Provider number Geographic 

CBSA 

Wage index 

CBSA 508 

reclassification 

Own wage 

index 

350010 ......................................................................................................................................... 35 22020 ........................

350014 ......................................................................................................................................... 35 22020 ........................

350015 ......................................................................................................................................... 13900 22020 ........................

350017 ......................................................................................................................................... 35 22020 ........................

350030 ......................................................................................................................................... 35 22020 ........................

350061 ......................................................................................................................................... 35 22020 ........................

380090 ......................................................................................................................................... 38 ........................ 1.2316 

390001 ......................................................................................................................................... 42540 10900 ........................

390003 ......................................................................................................................................... 39 10900 ........................

390054 ......................................................................................................................................... 42540 29540 ........................

390072 ......................................................................................................................................... 39 10900 ........................

390095 ......................................................................................................................................... 42540 10900 ........................

390109 ......................................................................................................................................... 42540 10900 ........................

390119 ......................................................................................................................................... 42540 10900 ........................

390137 ......................................................................................................................................... 42540 10900 ........................

390169 ......................................................................................................................................... 42540 10900 ........................

390185 ......................................................................................................................................... 42540 29540 ........................

390192 ......................................................................................................................................... 42540 10900 ........................

390237 ......................................................................................................................................... 42540 10900 ........................

390270 ......................................................................................................................................... 42540 29540 ........................

410010 ......................................................................................................................................... 39300 ........................ 1.1746 

430005 ......................................................................................................................................... 43 39660 ........................

430015 ......................................................................................................................................... 43 43620 ........................

430048 ......................................................................................................................................... 43 43620 ........................

430060 ......................................................................................................................................... 43 43620 ........................

430064 ......................................................................................................................................... 43 43620 ........................

430077 ......................................................................................................................................... 39660 43620 ........................

430091 ......................................................................................................................................... 39660 43620 ........................

450010 ......................................................................................................................................... 48660 32580 ........................

450072 ......................................................................................................................................... 26420 26420 ........................

450591 ......................................................................................................................................... 26420 26420 ........................

470003 ......................................................................................................................................... 15540 14484 ........................

490001 ......................................................................................................................................... 49 31340 ........................

490024 ......................................................................................................................................... 40220 19260 ........................

530015 ......................................................................................................................................... 53 ........................ 0.9897 

070006* ........................................................................................................................................ 14860 35644 ........................

070018* ........................................................................................................................................ 14860 35644 ........................

070034* ........................................................................................................................................ 14860 35644 ........................

140155* ........................................................................................................................................ 28100 16974 ........................

140186* ........................................................................................................................................ 28100 16974 ........................

250078* ........................................................................................................................................ 25620 25060 ........................

270002* ........................................................................................................................................ 27 33540 ........................

270012* ........................................................................................................................................ 24500 33540 ........................

270084* ........................................................................................................................................ 27 33540 ........................

330023* ........................................................................................................................................ 39100 35644 ........................

330067* ........................................................................................................................................ 39100 35644 ........................

350019* ........................................................................................................................................ 24220 22020 ........................

430008* ........................................................................................................................................ 43 43620 ........................

430013* ........................................................................................................................................ 43 43620 ........................

430031* ........................................................................................................................................ 43 43620 ........................

530008* ........................................................................................................................................ 53 16220 ........................

530010* ........................................................................................................................................ 53 16220 

TABLE 9C.—HOSPITALS REDESIGNATED AS RURAL UNDER SECTION 1886(D)(8)(E) OF THE ACT

Provider number Geographic 

CBSA 

Redesignated 

rural area 

030007 ..................................................................................................................................................................... 39140 03 

040075 ..................................................................................................................................................................... 22220 04 

050192 ..................................................................................................................................................................... 23420 05 

050469 ..................................................................................................................................................................... 40140 05 

050528 ..................................................................................................................................................................... 32900 05 

050618 ..................................................................................................................................................................... 40140 05 

070004 ..................................................................................................................................................................... 25540 07 

100048 ..................................................................................................................................................................... 37860 10 

100134 ..................................................................................................................................................................... 27260 10 

130018 ..................................................................................................................................................................... 26820 13 

23642 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

TABLE 9C.—HOSPITALS REDESIGNATED AS RURAL UNDER SECTION 1886(D)(8)(E) OF THE ACT—Continued 

Provider number Geographic 

CBSA 

Redesignated 

rural area 

140167 ..................................................................................................................................................................... 14 14 

150051 ..................................................................................................................................................................... 14020 15 

150078 ..................................................................................................................................................................... 23844 15 

170137 ..................................................................................................................................................................... 29940 17 

190048 ..................................................................................................................................................................... 26380 19 

230078 ..................................................................................................................................................................... 35660 23 

240037 ..................................................................................................................................................................... 33460 24 

260006 ..................................................................................................................................................................... 41140 26 

300009 ..................................................................................................................................................................... 31700 30 

370054 ..................................................................................................................................................................... 36420 37 

380040 ..................................................................................................................................................................... 13460 38 

380084 ..................................................................................................................................................................... 41420 38 

390181 ..................................................................................................................................................................... 39 39 

390183 ..................................................................................................................................................................... 39 39 

390201 ..................................................................................................................................................................... 39 39 

450052 ..................................................................................................................................................................... 45 45 

450078 ..................................................................................................................................................................... 10180 45 

450243 ..................................................................................................................................................................... 10180 45 

450276 ..................................................................................................................................................................... 48660 45 

450348 ..................................................................................................................................................................... 45 45 

500023 ..................................................................................................................................................................... 28420 50 

500037 ..................................................................................................................................................................... 49420 50 

500122 ..................................................................................................................................................................... 50 50 

500147 ..................................................................................................................................................................... 42644 50 

500148 ..................................................................................................................................................................... 48300 50 

TABLE 10.—GEOMETRIC MEAN PLUS

THE LESSER OF .75 OF THE NATIONAL ADJUSTED OPERATING

STANDARDIZED PAYMENT AMOUNT

(INCREASED TO REFLECT THE DIFFERENCE BETWEEN COSTS AND

CHARGES) OR .75 OF ONE STANDARD DEVIATION OF MEAN CHARGES

BY DIAGNOSIS-RELATED GROUP

(DRG)—MARCH 2005 1

DRG Cases Threshold 

1 ........................ 23,252 $53,083 

2 ........................ 10,344 $37,759 

3 ........................ 4 $48,426 

6 ........................ 410 $15,918 

7 ........................ 15,583 $41,465 

8 ........................ 3,699 $30,770 

9 ........................ 1,942 $26,987 

10 ...................... 19,496 $24,514 

11 ...................... 3,278 $17,942 

12 ...................... 54,365 $17,418 

13 ...................... 7,327 $16,737 

14 ...................... 236,739 $24,767 

15 ...................... 76,007 $18,842 

16 ...................... 16,254 $26,229 

17 ...................... 3,005 $14,673 

18 ...................... 33,048 $19,757 

19 ...................... 8,553 $14,440 

20 ...................... 6,528 $41,346 

21 ...................... 2,195 $28,454 

22 ...................... 3,315 $23,057 

23 ...................... 10,714 $15,561 

24 ...................... 63,800 $19,706 

25 ...................... 28,130 $12,635 

26 ...................... 18 $25,170 

27 ...................... 5,385 $26,078 

28 ...................... 17,543 $26,266 

29 ...................... 6,262 $14,651 

31 ...................... 5,087 $19,123 

32 ...................... 1,981 $12,778 

TABLE 10.—GEOMETRIC MEAN PLUS

THE LESSER OF .75 OF THE NATIONAL ADJUSTED OPERATING

STANDARDIZED PAYMENT AMOUNT

(INCREASED TO REFLECT THE DIFFERENCE BETWEEN COSTS AND

CHARGES) OR .75 OF ONE STANDARD DEVIATION OF MEAN CHARGES

BY DIAGNOSIS-RELATED GROUP

(DRG)—MARCH 2005 1—Continued 

DRG Cases Threshold 

34 ...................... 27,853 $19,761 

35 ...................... 7,887 $12,867 

36 ...................... 1,469 $14,560 

37 ...................... 1,237 $23,489 

38 ...................... 56 $14,212 

39 ...................... 447 $14,248 

40 ...................... 1,382 $19,777 

42 ...................... 1,144 $16,384 

43 ...................... 125 $11,950 

44 ...................... 1,159 $13,657 

45 ...................... 2,798 $15,147 

46 ...................... 3,816 $15,156 

47 ...................... 1,334 $10,768 

49 ...................... 2,474 $32,109 

50 ...................... 2,161 $17,332 

51 ...................... 190 $18,236 

52 ...................... 165 $17,220 

53 ...................... 2,223 $26,424 

55 ...................... 1,353 $18,794 

56 ...................... 435 $17,620 

57 ...................... 697 $22,175 

59 ...................... 102 $15,452 

60 ...................... 8 $16,595 

61 ...................... 219 $25,804 

63 ...................... 2,841 $27,928 

64 ...................... 3,339 $23,367 

65 ...................... 41,395 $12,285 

66 ...................... 8,002 $11,762 

67 ...................... 418 $15,509 

TABLE 10.—GEOMETRIC MEAN PLUS

THE LESSER OF .75 OF THE NATIONAL ADJUSTED OPERATING

STANDARDIZED PAYMENT AMOUNT

(INCREASED TO REFLECT THE DIFFERENCE BETWEEN COSTS AND

CHARGES) OR .75 OF ONE STANDARD DEVIATION OF MEAN CHARGES

BY DIAGNOSIS-RELATED GROUP

(DRG)—MARCH 2005 1—Continued 

DRG Cases Threshold 

68 ...................... 17,310 $13,327 

69 ...................... 4,810 $9,913 

70 ...................... 25 $8,304 

71 ...................... 68 $15,084 

72 ...................... 1,065 $15,307 

73 ...................... 7,925 $16,547 

74 ...................... 4 $7,279 

75 ...................... 45,004 $47,996 

76 ...................... 47,304 $43,717 

77 ...................... 2,153 $24,202 

78 ...................... 45,589 $24,850 

79 ...................... 170,543 $30,457 

80 ...................... 7,717 $17,767 

81 ...................... 4 $37,091 

82 ...................... 65,088 $27,672 

83 ...................... 6,944 $19,629 

84 ...................... 1,470 $11,706 

85 ...................... 21,855 $24,898 

86 ...................... 1,859 $14,235 

87 ...................... 82,642 $27,783 

88 ...................... 413,274 $17,776 

89 ...................... 550,119 $20,636 

90 ...................... 45,801 $12,316 

91 ...................... 45 $16,785 

92 ...................... 16,483 $23,911 

93 ...................... 1,596 $14,444 

94 ...................... 13,330 $23,013 

95 ...................... 1,609 $12,307 

96 ...................... 59,079 $14,840 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23643 

TABLE 10.—GEOMETRIC MEAN PLUS

THE LESSER OF .75 OF THE NATIONAL ADJUSTED OPERATING

STANDARDIZED PAYMENT AMOUNT

(INCREASED TO REFLECT THE DIFFERENCE BETWEEN COSTS AND

CHARGES) OR .75 OF ONE STANDARD DEVIATION OF MEAN CHARGES

BY DIAGNOSIS-RELATED GROUP

(DRG)—MARCH 2005 1—Continued 

DRG Cases Threshold 

97 ...................... 26,996 $10,870 

98 ...................... 8 $8,495 

99 ...................... 21,531 $14,399 

100 .................... 6,934 $11,081 

101 .................... 23,083 $17,487 

102 .................... 5,236 $11,147 

103 .................... 724 $214,160 

104 .................... 20,904 $117,844 

105 .................... 31,499 $89,729 

106 .................... 3,492 $108,656 

107 .................... 69,982 $85,171 

108 .................... 7,942 $85,326 

109 .................... 50,600 $65,918 

110 .................... 57,121 $59,055 

111 .................... 10,070 $44,900 

113 .................... 37,225 $44,754 

114 .................... 8,509 $31,122 

115 .................... 22,119 $58,803 

116 .................... 118,448 $43,379 

117 .................... 5,146 $26,461 

118 .................... 7,591 $33,464 

119 .................... 993 $26,580 

120 .................... 36,272 $36,812 

121 .................... 159,450 $30,813 

122 .................... 61,715 $19,625 

123 .................... 33,617 $27,218 

124 .................... 130,598 $28,749 

125 .................... 95,641 $22,067 

126 .................... 5,822 $42,108 

127 .................... 695,047 $20,505 

128 .................... 5,170 $13,906 

129 .................... 3,751 $20,637 

130 .................... 89,029 $18,640 

131 .................... 23,806 $11,216 

132 .................... 117,219 $12,597 

133 .................... 7,276 $10,986 

134 .................... 42,382 $12,400 

135 .................... 7,433 $17,747 

136 .................... 1,133 $12,797 

138 .................... 206,854 $16,622 

139 .................... 78,506 $10,671 

140 .................... 38,098 $10,335 

141 .................... 121,790 $15,337 

142 .................... 52,218 $12,040 

143 .................... 249,138 $11,604 

144 .................... 99,593 $25,098 

145 .................... 6,178 $11,899 

146 .................... 10,762 $44,908 

147 .................... 2,627 $29,912 

148 .................... 135,543 $51,340 

149 .................... 19,884 $28,508 

150 .................... 22,692 $45,073 

151 .................... 5,351 $25,703 

152 .................... 5,006 $34,651 

153 .................... 2,089 $21,823 

154 .................... 28,473 $55,952 

155 .................... 6,159 $25,835 

156 .................... 6 $52,265 

157 .................... 8,254 $26,362 

158 .................... 4,104 $13,493 

159 .................... 19,160 $28,111 

TABLE 10.—GEOMETRIC MEAN PLUS

THE LESSER OF .75 OF THE NATIONAL ADJUSTED OPERATING

STANDARDIZED PAYMENT AMOUNT

(INCREASED TO REFLECT THE DIFFERENCE BETWEEN COSTS AND

CHARGES) OR .75 OF ONE STANDARD DEVIATION OF MEAN CHARGES

BY DIAGNOSIS-RELATED GROUP

(DRG)—MARCH 2005 1—Continued 

DRG Cases Threshold 

160 .................... 11,968 $17,182 

161 .................... 10,417 $23,781 

162 .................... 5,486 $13,865 

163 .................... 10 $14,004 

164 .................... 5,941 $39,874 

165 .................... 2,518 $23,716 

166 .................... 4,928 $28,877 

167 .................... 4,623 $17,916 

168 .................... 1,544 $25,383 

169 .................... 754 $14,788 

170 .................... 17,464 $44,402 

171 .................... 1,483 $24,371 

172 .................... 32,853 $27,512 

173 .................... 2,388 $15,475 

174 .................... 267,618 $20,328 

175 .................... 32,616 $11,567 

176 .................... 14,542 $22,357 

177 .................... 8,545 $18,625 

178 .................... 2,903 $14,386 

179 .................... 14,417 $21,872 

180 .................... 92,094 $19,340 

181 .................... 25,878 $11,462 

182 .................... 291,824 $16,956 

183 .................... 86,469 $12,060 

184 .................... 78 $10,539 

185 .................... 5,678 $17,264 

186 .................... 4 $6,213 

187 .................... 621 $17,068 

188 .................... 90,890 $22,183 

189 .................... 13,170 $12,414 

190 .................... 69 $12,679 

191 .................... 10,395 $54,119 

192 .................... 1,322 $33,415 

193 .................... 4,505 $50,334 

194 .................... 520 $32,038 

195 .................... 3,247 $49,676 

196 .................... 699 $32,386 

197 .................... 17,294 $41,808 

198 .................... 4,629 $24,029 

199 .................... 1,422 $38,851 

200 .................... 936 $39,812 

201 .................... 2,664 $51,676 

202 .................... 27,245 $26,568 

203 .................... 31,633 $27,380 

204 .................... 72,764 $22,089 

205 .................... 31,436 $23,369 

206 .................... 2,075 $14,944 

207 .................... 35,719 $23,543 

208 .................... 9,747 $14,208 

210 .................... 128,257 $35,917 

211 .................... 26,620 $24,559 

212 .................... 10 $26,686 

213 .................... 10,256 $34,143 

216 .................... 17,645 $36,166 

217 .................... 17,611 $42,611 

218 .................... 28,683 $32,278 

219 .................... 21,323 $20,929 

220 .................... 4 $31,838 

223 .................... 13,414 $22,467 

224 .................... 10,864 $16,561 

225 .................... 6,508 $24,064 

TABLE 10.—GEOMETRIC MEAN PLUS

THE LESSER OF .75 OF THE NATIONAL ADJUSTED OPERATING

STANDARDIZED PAYMENT AMOUNT

(INCREASED TO REFLECT THE DIFFERENCE BETWEEN COSTS AND

CHARGES) OR .75 OF ONE STANDARD DEVIATION OF MEAN CHARGES

BY DIAGNOSIS-RELATED GROUP

(DRG)—MARCH 2005 1—Continued 

DRG Cases Threshold 

226 .................... 6,656 $29,923 

227 .................... 5,068 $16,786 

228 .................... 2,639 $23,112 

229 .................... 1,198 $14,205 

230 .................... 2,564 $26,523 

232 .................... 721 $19,464 

233 .................... 15,107 $35,245 

234 .................... 7,659 $25,357 

235 .................... 4,964 $14,917 

236 .................... 42,358 $14,238 

237 .................... 2,019 $12,305 

238 .................... 9,863 $27,442 

239 .................... 42,910 $21,095 

240 .................... 12,638 $25,924 

241 .................... 2,693 $13,360 

242 .................... 2,742 $22,347 

243 .................... 101,378 $15,581 

244 .................... 15,777 $14,369 

245 .................... 5,832 $9,431 

246 .................... 1,429 $12,106 

247 .................... 21,645 $11,781 

248 .................... 15,098 $17,268 

249 .................... 14,017 $13,881 

250 .................... 4,149 $13,866 

251 .................... 2,146 $9,765 

253 .................... 24,829 $15,141 

254 .................... 10,404 $9,271 

256 .................... 7,144 $16,671 

257 .................... 13,494 $17,881 

258 .................... 12,014 $14,270 

259 .................... 2,898 $19,381 

260 .................... 2,981 $14,202 

261 .................... 1,603 $19,576 

262 .................... 636 $19,862 

263 .................... 23,791 $33,555 

264 .................... 3,921 $20,803 

265 .................... 4,304 $29,777 

266 .................... 2,303 $17,605 

267 .................... 272 $18,035 

268 .................... 1,003 $23,142 

269 .................... 10,670 $31,752 

270 .................... 2,635 $16,856 

271 .................... 21,019 $19,407 

272 .................... 5,931 $19,148 

273 .................... 1,348 $11,532 

274 .................... 2,287 $23,181 

275 .................... 228 $11,152 

276 .................... 1,445 $13,974 

277 .................... 112,171 $17,127 

278 .................... 33,823 $10,861 

279 .................... 6 $17,172 

280 .................... 19,255 $14,562 

281 .................... 7,092 $9,993 

283 .................... 6,268 $14,563 

284 .................... 1,829 $9,200 

285 .................... 7,615 $35,872 

286 .................... 2,702 $35,486 

287 .................... 6,107 $32,104 

288 .................... 10,432 $37,872 

289 .................... 6,881 $18,298 

290 .................... 10,827 $17,619 

23644 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

TABLE 10.—GEOMETRIC MEAN PLUS

THE LESSER OF .75 OF THE NATIONAL ADJUSTED OPERATING

STANDARDIZED PAYMENT AMOUNT

(INCREASED TO REFLECT THE DIFFERENCE BETWEEN COSTS AND

CHARGES) OR .75 OF ONE STANDARD DEVIATION OF MEAN CHARGES

BY DIAGNOSIS-RELATED GROUP

(DRG)—MARCH 2005 1—Continued 

DRG Cases Threshold 

291 .................... 64 $18,543 

292 .................... 7,321 $41,142 

293 .................... 367 $27,840 

294 .................... 98,864 $15,044 

295 .................... 4,096 $14,601 

296 .................... 254,455 $16,168 

297 .................... 45,318 $9,887 

298 .................... 81 $9,998 

299 .................... 1,478 $20,010 

300 .................... 21,321 $21,770 

301 .................... 3,896 $12,544 

302 .................... 9,646 $52,723 

303 .................... 23,740 $39,286 

304 .................... 13,816 $38,375 

305 .................... 3,084 $23,623 

306 .................... 6,341 $25,247 

307 .................... 2,061 $12,398 

308 .................... 7,089 $30,158 

309 .................... 3,555 $18,659 

310 .................... 26,019 $23,711 

311 .................... 6,468 $13,013 

312 .................... 1,454 $22,529 

313 .................... 507 $14,119 

315 .................... 36,526 $35,138 

316 .................... 180,759 $25,061 

317 .................... 2,756 $16,124 

318 .................... 5,923 $23,425 

319 .................... 382 $13,277 

320 .................... 218,425 $17,103 

321 .................... 31,366 $11,424 

322 .................... 61 $11,164 

323 .................... 20,454 $16,793 

324 .................... 5,414 $10,413 

325 .................... 9,600 $13,014 

326 .................... 2,574 $9,069 

327 .................... 5 $5,743 

328 .................... 606 $14,673 

329 .................... 71 $10,155 

331 .................... 54,748 $20,954 

332 .................... 4,387 $12,467 

333 .................... 251 $18,573 

334 .................... 9,802 $28,443 

335 .................... 11,919 $21,877 

336 .................... 31,235 $16,658 

337 .................... 25,130 $11,427 

338 .................... 652 $27,712 

339 .................... 1,253 $23,286 

340 .................... 2 $18,734 

341 .................... 3,183 $25,976 

342 .................... 563 $17,354 

344 .................... 2,691 $25,572 

345 .................... 1,461 $22,328 

346 .................... 3,962 $21,235 

347 .................... 247 $12,515 

348 .................... 4,171 $14,696 

349 .................... 575 $8,797 

350 .................... 7,134 $14,636 

352 .................... 973 $14,967 

353 .................... 2,725 $32,476 

354 .................... 7,603 $29,914 

355 .................... 4,922 $17,549 

TABLE 10.—GEOMETRIC MEAN PLUS

THE LESSER OF .75 OF THE NATIONAL ADJUSTED OPERATING

STANDARDIZED PAYMENT AMOUNT

(INCREASED TO REFLECT THE DIFFERENCE BETWEEN COSTS AND

CHARGES) OR .75 OF ONE STANDARD DEVIATION OF MEAN CHARGES

BY DIAGNOSIS-RELATED GROUP

(DRG)—MARCH 2005 1—Continued 

DRG Cases Threshold 

356 .................... 23,932 $14,960 

357 .................... 5,563 $38,097 

358 .................... 20,763 $22,658 

359 .................... 28,654 $15,907 

360 .................... 14,748 $17,209 

361 .................... 272 $22,454 

362 .................... 2 $11,608 

363 .................... 2,127 $19,999 

364 .................... 1,449 $17,758 

365 .................... 1,620 $32,955 

366 .................... 4,786 $24,830 

367 .................... 455 $12,018 

368 .................... 3,920 $23,343 

369 .................... 3,610 $12,832 

370 .................... 1,838 $17,389 

371 .................... 2,236 $11,866 

372 .................... 1,162 $9,834 

373 .................... 4,860 $7,061 

374 .................... 156 $13,290 

375 .................... 6 $33,543 

376 .................... 388 $10,147 

377 .................... 77 $25,958 

378 .................... 195 $15,828 

379 .................... 507 $7,202 

380 .................... 91 $7,834 

381 .................... 212 $12,620 

382 .................... 43 $4,126 

383 .................... 2,472 $9,812 

384 .................... 132 $6,300 

392 .................... 2,202 $45,471 

394 .................... 2,818 $31,480 

395 .................... 115,973 $16,480 

396 .................... 9 $15,832 

397 .................... 18,425 $24,257 

398 .................... 18,256 $24,100 

399 .................... 1,634 $13,682 

401 .................... 6,325 $43,589 

402 .................... 1,401 $24,076 

403 .................... 31,827 $30,787 

404 .................... 3,799 $18,943 

406 .................... 2,222 $42,772 

407 .................... 583 $24,742 

408 .................... 2,170 $33,802 

409 .................... 1,807 $24,850 

410 .................... 28,395 $22,712 

411 .................... 12 $7,141 

412 .................... 12 $16,545 

413 .................... 5,193 $26,451 

414 .................... 572 $16,081 

415 .................... 50,799 $51,864 

416 .................... 238,848 $29,646 

417 .................... 23 $20,595 

418 .................... 28,478 $21,320 

419 .................... 16,269 $17,124 

420 .................... 2,939 $12,324 

421 .................... 11,866 $14,876 

422 .................... 52 $10,935 

423 .................... 8,631 $29,978 

424 .................... 1,071 $36,011 

425 .................... 14,758 $12,572 

426 .................... 4,309 $9,562 

TABLE 10.—GEOMETRIC MEAN PLUS

THE LESSER OF .75 OF THE NATIONAL ADJUSTED OPERATING

STANDARDIZED PAYMENT AMOUNT

(INCREASED TO REFLECT THE DIFFERENCE BETWEEN COSTS AND

CHARGES) OR .75 OF ONE STANDARD DEVIATION OF MEAN CHARGES

BY DIAGNOSIS-RELATED GROUP

(DRG)—MARCH 2005 1—Continued 

DRG Cases Threshold 

427 .................... 1,504 $10,543 

428 .................... 769 $13,558 

429 .................... 25,454 $15,545 

430 .................... 71,402 $12,774 

431 .................... 304 $10,532 

432 .................... 420 $12,850 

433 .................... 5,189 $5,613 

439 .................... 1,738 $30,816 

440 .................... 5,606 $30,736 

441 .................... 779 $18,744 

442 .................... 18,000 $37,969 

443 .................... 3,382 $20,255 

444 .................... 5,891 $14,879 

445 .................... 2,345 $10,336 

447 .................... 6,258 $10,696 

449 .................... 38,766 $16,579 

450 .................... 7,787 $8,697 

451 .................... 3 $5,847 

452 .................... 27,610 $20,394 

453 .................... 5,431 $10,730 

454 .................... 3,835 $15,920 

455 .................... 846 $9,717 

461 .................... 2,722 $27,440 

462 .................... 7,751 $16,591 

463 .................... 31,026 $13,855 

464 .................... 7,651 $10,292 

465 .................... 219 $12,019 

466 .................... 1,377 $12,550 

467 .................... 1,013 $9,726 

468 .................... 50,411 $55,817 

470 .................... 32 $13,204 

471 .................... 15,474 $55,297 

473 .................... 8,761 $39,707 

475 .................... 116,437 $51,182 

476 .................... 3,018 $36,994 

477 .................... 29,401 $33,866 

478 .................... 113,571 $40,296 

479 .................... 24,583 $29,518 

480 .................... 800 $120,367 

481 .................... 1,065 $86,015 

482 .................... 5,070 $49,484 

484 .................... 449 $74,694 

485 .................... 3,412 $50,963 

486 .................... 2,562 $66,540 

487 .................... 4,640 $32,711 

488 .................... 786 $58,001 

489 .................... 13,453 $29,620 

490 .................... 5,203 $21,034 

491 .................... 19,730 $32,883 

492 .................... 4,005 $44,873 

493 .................... 61,564 $35,020 

494 .................... 25,546 $20,780 

495 .................... 303 $109,115 

496 .................... 3,255 $92,679 

497 .................... 27,777 $59,046 

498 .................... 19,008 $49,170 

499 .................... 35,640 $27,782 

500 .................... 48,213 $18,126 

501 .................... 3,120 $43,064 

502 .................... 717 $28,008 

503 .................... 5,905 $24,316 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23645 

TABLE 10.—GEOMETRIC MEAN PLUS

THE LESSER OF .75 OF THE NATIONAL ADJUSTED OPERATING

STANDARDIZED PAYMENT AMOUNT

(INCREASED TO REFLECT THE DIFFERENCE BETWEEN COSTS AND

CHARGES) OR .75 OF ONE STANDARD DEVIATION OF MEAN CHARGES

BY DIAGNOSIS-RELATED GROUP

(DRG)—MARCH 2005 1—Continued 

DRG Cases Threshold 

504 .................... 187 $136,123 

505 .................... 179 $27,684 

506 .................... 1,004 $51,873 

507 .................... 307 $32,100 

508 .................... 641 $24,619 

509 .................... 168 $14,897 

510 .................... 1,755 $21,890 

511 .................... 633 $12,748 

512 .................... 513 $81,413 

513 .................... 227 $97,844 

515 .................... 44,389 $88,758 

517 .................... 66,155 $40,225 

518 .................... 42,015 $35,092 

519 .................... 11,497 $43,638 

520 .................... 15,218 $33,659 

521 .................... 32,138 $13,596 

TABLE 10.—GEOMETRIC MEAN PLUS

THE LESSER OF .75 OF THE NATIONAL ADJUSTED OPERATING

STANDARDIZED PAYMENT AMOUNT

(INCREASED TO REFLECT THE DIFFERENCE BETWEEN COSTS AND

CHARGES) OR .75 OF ONE STANDARD DEVIATION OF MEAN CHARGES

BY DIAGNOSIS-RELATED GROUP

(DRG)—MARCH 2005 1—Continued 

DRG Cases Threshold 

522 .................... 5,642 $9,515 

523 .................... 15,863 $7,639 

524 .................... 118,842 $14,823 

525 .................... 313 $139,715 

527 .................... 191,680 $44,147 

528 .................... 1,767 $102,318 

529 .................... 4,030 $37,957 

530 .................... 2,362 $24,232 

531 .................... 4,796 $45,158 

532 .................... 2,622 $29,368 

533 .................... 47,549 $31,277 

534 .................... 45,166 $20,426 

535 .................... 7,384 $123,742 

536 .................... 8,047 $108,821 

537 .................... 8,640 $33,393 

538 .................... 5,598 $20,028 

TABLE 10.—GEOMETRIC MEAN PLUS

THE LESSER OF .75 OF THE NATIONAL ADJUSTED OPERATING

STANDARDIZED PAYMENT AMOUNT

(INCREASED TO REFLECT THE DIFFERENCE BETWEEN COSTS AND

CHARGES) OR .75 OF ONE STANDARD DEVIATION OF MEAN CHARGES

BY DIAGNOSIS-RELATED GROUP

(DRG)—MARCH 2005 1—Continued 

DRG Cases Threshold 

539 .................... 5,014 $44,863 

540 .................... 1,509 $23,964 

541 .................... 22,410 $242,891 

542 .................... 24,343 $155,852 

543 .................... 5,403 $62,826 

544 .................... 417,780 $37,604 

545 .................... 42,280 $44,313 

546 .................... 1,954 $77,955 

547 .................... 26,756 $49,899 

548 .................... 11,898 $41,613 

549 .................... 35,640 $55,680 

550 .................... 20,130 $47,573 

1 Cases are taken from the FY 2004 

MedPAR file; DRGs are from GROUPER 

Version 23.0. 

TABLE 11.—PROPOSED FY 2006 LTC–DRGS, RELATIVE WEIGHTS, GEOMETRIC AVERAGE LENGTH OF STAY, AND 5/6THS

OF THE GEOMETRIC AVERAGE LENGTH OF STAY

LTC–DRG Description Relative 

weight 

Geometric 

average 

length of 

stay 

5/6ths of the 

geometric 

average 

length of 

stay 

1 ............... 5 CRANIOTOMY AGE >17 W CC ..................................................................................... 1.6862 38.0 31.7 

2 ............... 7 CRANIOTOMY AGE >17 W/O CC ................................................................................. 1.6862 38.0 31.7 

3 ............... 7 CRANIOTOMY AGE 0–17 .............................................................................................. 1.6862 38.0 31.7 

6 ............... 7 CARPAL TUNNEL RELEASE ......................................................................................... 0.4502 18.8 15.7 

7 ............... PERIPH & CRANIAL NERVE & OTHER NERV SYST PROC W CC .............................. 1.3854 37.5 31.3 

8 ............... 3PERIPH & CRANIAL NERVE & OTHER NERV SYST PROC W/O CC ........................ 0.7586 24.5 20.4 

9 ............... SPINAL DISORDERS & INJURIES .................................................................................. 0.9617 33.2 27.7 

10 ............. NERVOUS SYSTEM NEOPLASMS W CC ...................................................................... 0.7441 24.2 20.2 

11 ............. 2 NERVOUS SYSTEM NEOPLASMS W/O CC ................................................................ 0.5834 21.0 17.5 

12 ............. DEGENERATIVE NERVOUS SYSTEM DISORDERS ..................................................... 0.6903 25.5 21.3 

13 ............. MULTIPLE SCLEROSIS & CEREBELLAR ATAXIA ......................................................... 0.6625 23.0 19.2 

14 ............. INTERCRANIAL HEMORRHAGE OR STROKE WITH INFARCT ................................... 0.7758 25.9 21.6 

15 ............. NONSPECIFIC CVA & PRECEREBRAL OCCULUSION WITHOUT INFARCT .............. 0.7398 27.0 22.5 

16 ............. NONSPECIFIC CEREBROVASCULAR DISORDERS W CC .......................................... 0.7507 23.5 19.6 

17 ............. 1 NONSPECIFIC CEREBROVASCULAR DISORDERS W/O CC .................................... 0.4502 18.8 15.7 

18 ............. CRANIAL & PERIPHERAL NERVE DISORDERS W CC ................................................ 0.7242 23.6 19.7 

19 ............. CRANIAL & PERIPHERAL NERVE DISORDERS W/O CC ............................................. 0.4809 21.2 17.7 

20 ............. NERVOUS SYSTEM INFECTION EXCEPT VIRAL MENINGITIS ................................... 1.0284 27.1 22.6 

21 ............. 3VIRAL MENINGITIS ........................................................................................................ 0.7586 24.5 20.4 

22 ............. 4 HYPERTENSIVE ENCEPHALOPATHY ......................................................................... 1.1679 29.6 24.7 

23 ............. NONTRAUMATIC STUPOR & COMA .............................................................................. 0.8101 25.4 21.2 

24 ............. SEIZURE & HEADACHE AGE >17 W CC ....................................................................... 0.6262 22.4 18.7 

25 ............. 1SEIZURE & HEADACHE AGE >17 W/O CC ................................................................. 0.4502 18.8 15.7 

26 ............. 7SEIZURE & HEADACHE AGE 0–17 .............................................................................. 0.4502 18.8 15.7 

27 ............. TRAUMATIC STUPOR & COMA, COMA >1 HR ............................................................. 0.9658 27.7 23.1

28 ............. TRAUMATIC STUPOR & COMA, COMA <1 HR AGE >17 W CC .................................. 0.9042 30.2 25.2 

29 ............. 1TRAUMATIC STUPOR & COMA, COMA <1 HR AGE >17 W/O CC ............................ 0.4502 18.8 15.7 

30 ............. 7TRAUMATIC STUPOR & COMA, COMA <1 HR AGE 0–17 ......................................... 0.4502 18.8 15.7 

31 ............. 3 CONCUSSION AGE >17 W CC ..................................................................................... 0.7586 24.5 20.4 

32 ............. 7 CONCUSSION AGE >17 W/O CC ................................................................................. 0.4502 18.8 15.7 

33 ............. 7 CONCUSSION AGE 0–17 .............................................................................................. 0.4502 18.8 15.7 

34 ............. OTHER DISORDERS OF NERVOUS SYSTEM W CC ................................................... 0.8056 25.2 21 

35 ............. OTHER DISORDERS OF NERVOUS SYSTEM W/O CC ................................................ 0.5758 24.0 20 

36 ............. 7 RETINAL PROCEDURES ............................................................................................... 1.1679 29.6 24.7 

37 ............. 7ORBITAL PROCEDURES ............................................................................................... 1.1679 29.6 24.7 

23646 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

TABLE 11.—PROPOSED FY 2006 LTC–DRGS, RELATIVE WEIGHTS, GEOMETRIC AVERAGE LENGTH OF STAY, AND 5/6THS

OF THE GEOMETRIC AVERAGE LENGTH OF STAY—Continued 

LTC–DRG Description Relative 

weight 

Geometric 

average 

length of 

stay 

5/6ths of the 

geometric 

average 

length of 

stay 

38 ............. 7PRIMARY IRIS PROCEDURES ..................................................................................... 1.1679 29.6 24.7 

39 ............. 7 LENS PROCEDURES WITH OR WITHOUT VITRECTOMY ......................................... 1.1679 29.6 24.7 

40 ............. 4EXTRAOCULAR PROCEDURES EXCEPT ORBIT AGE >17 ....................................... 1.1679 29.6 24.7 

41 ............. 7EXTRAOCULAR PROCEDURES EXCEPT ORBIT AGE 0–17 ..................................... 1.1679 29.6 24.7 

42 ............. 7 INTRAOCULAR PROCEDURES EXCEPT RETINA, IRIS & LENS ............................... 1.1679 29.6 24.7 

43 ............. 7 HYPHEMA ....................................................................................................................... 1.1679 29.6 24.7 

44 ............. 2ACUTE MAJOR EYE INFECTIONS ............................................................................... 0.5834 21.0 17.5 

45 ............. 7 NEUROLOGICAL EYE DISORDERS ............................................................................. 1.1679 29.6 24.7 

46 ............. 2OTHER DISORDERS OF THE EYE AGE >17 W CC ................................................... 0.5834 21.0 17.5 

47 ............. 7OTHER DISORDERS OF THE EYE AGE >17 W/O CC ................................................ 1.1679 29.6 24.7 

48 ............. 7OTHER DISORDERS OF THE EYE AGE 0–17 ............................................................ 1.1679 29.6 24.7 

49 ............. 7 MAJOR HEAD & NECK PROCEDURES ....................................................................... 1.1679 29.6 24.7 

50 ............. 7SIALOADENECTOMY ..................................................................................................... 1.1679 29.6 24.7 

51 ............. 7SALIVARY GLAND PROCEDURES EXCEPT SIALOADENECTOMY .......................... 1.1679 29.6 24.7 

52 ............. 7 CLEFT LIP & PALATE REPAIR ..................................................................................... 1.1679 29.6 24.7 

53 ............. 7SINUS & MASTOID PROCEDURES AGE >17 .............................................................. 1.1679 29.6 24.7 

54 ............. 7SINUS & MASTOID PROCEDURES AGE 0–17 ............................................................ 1.1679 29.6 24.7 

55 ............. 7 MISCELLANEOUS EAR, NOSE, MOUTH & THROAT PROCEDURES ........................ 1.1679 29.6 24.7 

56 ............. 7 RHINOPLASTY ............................................................................................................... 1.1679 29.6 24.7 

57 ............. 7T&A PROC, EXCEPT TONSILLECTOMY &/OR ADENOIDECTOMY ONLY, AGE >17 0.4502 18.8 15.7 

58 ............. 7T&A PROC, EXCEPT TONSILLECTOMY &/OR ADENOIDECTOMY ONLY, AGE 0–

17.

0.4502 18.8 15.7 

59 ............. 7TONSILLECTOMY &/OR ADENOIDECTOMY ONLY, AGE >17 ................................... 0.4502 18.8 15.7 

60 ............. 7TONSILLECTOMY &/OR ADENOIDECTOMY ONLY, AGE 0–17 ................................. 0.4502 18.8 15.7 

61 ............. 3 MYRINGOTOMY W TUBE INSERTION AGE >17 ......................................................... 0.7586 24.5 20.4 

62 ............. 7 MYRINGOTOMY W TUBE INSERTION AGE 0–17 ....................................................... 0.4502 18.8 15.7 

63 ............. 4OTHER EAR, NOSE, MOUTH & THROAT O.R. PROCEDURES ................................. 1.1679 29.6 24.7 

64 ............. EAR, NOSE, MOUTH & THROAT MALIGNANCY ........................................................... 1.1477 26.2 21.8 

65 ............. 1 DYSEQUILIBRIUM .......................................................................................................... 0.4502 18.8 15.7 

66 ............. 7EPISTAXIS ...................................................................................................................... 0.4502 18.8 15.7 

67 ............. 3EPIGLOTTITIS ................................................................................................................ 0.7586 24.5 20.4 

68 ............. OTITIS MEDIA & URI AGE >17 W CC ........................................................................ 0.5134 18.0 15 

69 ............. 1OTITIS MEDIA & URI AGE >17 W/O CC .................................................................. 0.4502 18.8 15.7 

70 ............. 7OTITIS MEDIA & URI AGE 0–17 ................................................................................... 0.4502 18.8 15.7 

71 ............. 7 LARYNGOTRACHEITIS .................................................................................................. 0.5834 21.0 17.5 

72 ............. 7 NASAL TRAUMA & DEFORMITY .................................................................................. 0.5834 21.0 17.5 

73 ............. OTHER EAR, NOSE, MOUTH & THROAT DIAGNOSES AGE >17 ................................ 0.6360 20.4 17 

74 ............. 7OTHER EAR, NOSE, MOUTH & THROAT DIAGNOSES AGE 0–17 ............................ 0.4502 18.8 15.7 

75 ............. 5 MAJOR CHEST PROCEDURES .................................................................................... 1.6862 38.0 31.7 

76 ............. OTHER RESP SYSTEM O.R. PROCEDURES W CC ..................................................... 2.5324 43.6 36.3 

77 ............. 5OTHER RESP SYSTEM O.R. PROCEDURES W/O CC ............................................... 1.6862 38.0 31.7 

78 ............. PULMONARY EMBOLISM ................................................................................................ 0.6955 21.9 18.3 

79 ............. RESPIRATORY INFECTIONS & INFLAMMATIONS AGE >17 W CC ............................. 0.8252 22.8 19 

80 ............. RESPIRATORY INFECTIONS & INFLAMMATIONS AGE >17 W/O CC ......................... 0.5993 21.5 17.9 

81 ............. 7 RESPIRATORY INFECTIONS & INFLAMMATIONS AGE 0–17 .................................... 0.4502 18.8 15.7 

82 ............. RESPIRATORY NEOPLASMS ......................................................................................... 0.7138 20.1 16.8 

83 ............. 2 MAJOR CHEST TRAUMA W CC ................................................................................... 0.5834 21.0 17.5 

84 ............. 7 MAJOR CHEST TRAUMA W/O CC ............................................................................... 0.5834 21.0 17.5 

85 ............. PLEURAL EFFUSION W CC ............................................................................................ 0.7308 21.2 17.7 

86 ............. 2PLEURAL EFFUSION W/O CC ...................................................................................... 0.5834 21.0 17.5 

87 ............. PULMONARY EDEMA & RESPIRATORY FAILURE ....................................................... 1.0797 25.3 21.1 

88 ............. CHRONIC OBSTRUCTIVE PULMONARY DISEASE ...................................................... 0.6620 19.6 16.3 

89 ............. SIMPLE PNEUMONIA & PLEURISY AGE >17 W CC ..................................................... 0.7027 20.8 17.3 

90 ............. SIMPLE PNEUMONIA & PLEURISY AGE >17 W/O CC ................................................. 0.5004 17.8 14.8 

91 ............. 7SIMPLE PNEUMONIA & PLEURISY AGE 0–17 ............................................................ 0.4502 18.8 15.7 

92 ............. INTERSTITIAL LUNG DISEASE W CC ............................................................................ 0.6764 20.2 16.8 

93 ............. 2 INTERSTITIAL LUNG DISEASE W/O CC ...................................................................... 0.5834 21.0 17.5 

94 ............. PNEUMOTHORAX W CC ................................................................................................. 0.5913 17.0 14.2 

95 ............. 1PNEUMOTHORAX W/O CC ........................................................................................... 0.4502 18.8 15.7 

96 ............. BRONCHITIS & ASTHMA AGE >17 W CC ...................................................................... 0.6436 19.4 16.2 

97 ............. 2BRONCHITIS & ASTHMA AGE >17 W/O CC ................................................................ 0.5834 21.0 17.5 

98 ............. 7BRONCHITIS & ASTHMA AGE 0–17 ............................................................................. 0.5834 21.0 17.5 

99 ............. RESPIRATORY SIGNS & SYMPTOMS W CC ................................................................ 0.9262 23.3 19.4 

100 ........... 3 RESPIRATORY SIGNS & SYMPTOMS W/O CC .......................................................... 0.7586 24.5 20.4 

101 ........... OTHER RESPIRATORY SYSTEM DIAGNOSES W CC .................................................. 0.8143 21.1 17.6 

102 ........... 1OTHER RESPIRATORY SYSTEM DIAGNOSES W/O CC ............................................ 0.4502 18.8 15.7 

103 ........... 6 HEART TRANSPLANT OR IMPLANT OF HEART ASSIST SYSTEM ........................... 0.0000 1.0 0.8 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23647 

TABLE 11.—PROPOSED FY 2006 LTC–DRGS, RELATIVE WEIGHTS, GEOMETRIC AVERAGE LENGTH OF STAY, AND 5/6THS

OF THE GEOMETRIC AVERAGE LENGTH OF STAY—Continued 

LTC–DRG Description Relative 

weight 

Geometric 

average 

length of 

stay 

5/6ths of the 

geometric 

average 

length of 

stay 

104 ........... 7 CARDIAC VALVE & OTH MAJOR CARDIOTHORACIC PROC W CARD CATH ......... 1.1679 29.6 24.7 

105 ........... 7 CARDIAC VALVE & OTH MAJOR CARDIOTHORACIC PROC W/O CARD CATH ..... 1.1679 29.6 24.7 

106 ........... 7 CORONARY BYPASS W PTCA ..................................................................................... 1.1679 29.6 24.7 

107 ........... 7 CORONARY BYPASS W CARDIAC CATH ................................................................... 1.1679 29.6 24.7 

108 ........... 7OTHER CARDIOTHORACIC PROCEDURES ................................................................ 1.1679 29.6 24.7 

109 ........... 7 CORONARY BYPASS W/O PTCA OR CARDIAC CATH .............................................. 1.1679 29.6 24.7 

110 ........... 4 MAJOR CARDIOVASCULAR PROCEDURES W CC .................................................... 1.1679 29.6 24.7 

111 ........... 7 MAJOR CARDIOVASCULAR PROCEDURES W/O CC ................................................ 1.1679 29.6 24.7 

113 ........... AMPUTATION FOR CIRC SYSTEM DISORDERS EXCEPT UPPER LIMB & TOE ....... 1.4877 39.2 32.7 

114 ........... UPPER LIMB & TOE AMPUTATION FOR CIRC SYSTEM DISORDERS ...................... 1.2453 33.2 27.7 

115 ........... 5PRM CARD PACEM IMPL W AMI,HRT FAIL OR SHK,OR AICD LEAD OR GNRTR 

P.

1.6862 38.0 31.7 

116 ........... 4OTH PERM CARD PACEMAK IMPL OR PTCA W CORONARY ARTERY STENT 

IMPLNT.

1.1679 29.6 24.7 

117 ........... 5CARDIAC PACEMAKER REVISION EXCEPT DEVICE REPLACEMENT .................... 1.6862 38.0 31.7 

118 ........... 4 CARDIAC PACEMAKER DEVICE REPLACEMENT ...................................................... 1.1679 29.6 24.7 

119 ........... 3VEIN LIGATION & STRIPPING ...................................................................................... 0.7586 24.5 20.4

120 ........... OTHER CIRCULATORY SYSTEM O.R. PROCEDURES ................................................ 1.1050 31.8 26.5 

121 ........... CIRCULATORY DISORDERS W AMI & MAJOR COMP, DISCHARGED ALIVE ........... 0.8200 22.6 18.8 

122 ........... 2 CIRCULATORY DISORDERS W AMI W/O MAJOR COMP, DISCHARGED ALIVE .... 0.5834 21.0 17.5 

123 ........... CIRCULATORY DISORDERS W AMI, EXPIRED ............................................................ 0.8678 18.7 15.6 

124 ........... 4 CIRCULATORY DISORDERS EXCEPT AMI, W CARD CATH & COMPLEX DIAG ..... 1.1679 29.6 24.7 

125 ........... 3 CIRCULATORY DISORDERS EXCEPT AMI, W CARD CATH W/O COMPLEX DIAG 0.7586 24.5 20.4 

126 ........... ACUTE & SUBACUTE ENDOCARDITIS .......................................................................... 0.8467 25.3 21.1 

127 ........... HEART FAILURE & SHOCK ............................................................................................. 0.6890 21.1 17.6 

128 ........... 2 DEEP VEIN THROMBOPHLEBITIS ............................................................................... 0.5834 21.0 17.5 

129 ........... 7 CARDIAC ARREST, UNEXPLAINED ............................................................................. 1.1679 29.6 24.7 

130 ........... PERIPHERAL VASCULAR DISORDERS W CC .............................................................. 0.6755 23.1 19.3 

131 ........... PERIPHERAL VASCULAR DISORDERS W/O CC .......................................................... 0.4698 20.4 17 

132 ........... ATHEROSCLEROSIS W CC ............................................................................................ 0.6639 21.8 18.2 

133 ........... 1ATHEROSCLEROSIS W/O CC ...................................................................................... 0.4502 18.8 15.7 

134 ........... HYPERTENSION .............................................................................................................. 0.6388 24.7 20.6 

135 ........... CARDIAC CONGENITAL & VALVULAR DISORDERS AGE >17 W CC ......................... 0.7272 23.7 19.8 

136 ........... 2 CARDIAC CONGENITAL & VALVULAR DISORDERS AGE >17 W/O CC ................... 0.5834 21.0 17.5 

137 ........... 7 CARDIAC CONGENITAL & VALVULAR DISORDERS AGE 0–17 ................................ 0.5834 21.0 17.5 

138 ........... CARDIAC ARRHYTHMIA & CONDUCTION DISORDERS W CC ................................... 0.6183 20.4 17 

139 ........... 2 CARDIAC ARRHYTHMIA & CONDUCTION DISORDERS W/O CC ............................. 0.5834 21.0 17.5 

140 ........... 1ANGINA PECTORIS ....................................................................................................... 0.4502 18.8 15.7 

141 ........... SYNCOPE & COLLAPSE W CC ...................................................................................... 0.4356 18.3 15.3 

142 ........... 1SYNCOPE & COLLAPSE W/O CC ................................................................................ 0.4502 18.8 15.7 

143 ........... 2 CHEST PAIN ................................................................................................................... 0.5834 21.0 17.5 

144 ........... OTHER CIRCULATORY SYSTEM DIAGNOSES W CC .................................................. 0.7364 21.6 18 

145 ........... OTHER CIRCULATORY SYSTEM DIAGNOSES W/O CC .............................................. 0.4544 18.0 15 

146 ........... 7 RECTAL RESECTION W CC ......................................................................................... 1.6862 38.0 31.7 

147 ........... 7 RECTAL RESECTION W/O CC ..................................................................................... 1.6862 38.0 31.7 

148 ........... MAJOR SMALL & LARGE BOWEL PROCEDURES W CC ............................................ 1.8800 40.8 34 

149 ........... 7 MAJOR SMALL & LARGE BOWEL PROCEDURES W/O CC ....................................... 0.7586 24.5 20.4 

150 ........... 4PERITONEAL ADHESIOLYSIS W CC ........................................................................... 1.1679 29.6 24.7 

151 ........... 2PERITONEAL ADHESIOLYSIS W/O CC ....................................................................... 0.5834 21.0 17.5 

152 ........... 3 MINOR SMALL & LARGE BOWEL PROCEDURES W CC ........................................... 0.7586 24.5 20.4 

153 ........... 7 MINOR SMALL & LARGE BOWEL PROCEDURES W/O CC ....................................... 0.7586 24.5 20.4 

154 ........... 5STOMACH, ESOPHAGEAL & DUODENAL PROCEDURES AGE >17 W CC ............. 1.6862 38.0 31.7 

155 ........... 7STOMACH, ESOPHAGEAL & DUODENAL PROCEDURES AGE >17 W/O CC .......... 1.6862 38.0 31.7 

156 ........... 7STOMACH, ESOPHAGEAL & DUODENAL PROCEDURES AGE 0–17 ....................... 1.6862 38.0 31.7 

157 ........... 4ANAL & STOMAL PROCEDURES W CC ...................................................................... 1.1679 29.6 24.7 

158 ........... 7ANAL & STOMAL PROCEDURES W/O CC .................................................................. 1.1679 29.6 24.7 

159 ........... 7 HERNIA PROCEDURES EXCEPT INGUINAL & FEMORAL AGE >17 W CC ............. 0.7586 24.5 20.4 

160 ........... 7 HERNIA PROCEDURES EXCEPT INGUINAL & FEMORAL AGE >17 W/O CC .......... 0.7586 24.5 20.4 

161 ........... 5 INGUINAL & FEMORAL HERNIA PROCEDURES AGE >17 W CC ............................. 1.6862 38.0 31.7 

162 ........... 7 INGUINAL & FEMORAL HERNIA PROCEDURES AGE >17 W/O CC ......................... 0.7586 24.5 20.4 

163 ........... 7 HERNIA PROCEDURES AGE 0–17 .............................................................................. 0.7586 24.5 20.4 

164 ........... 7APPENDECTOMY W COMPLICATED PRINCIPAL DIAG W CC .................................. 1.6862 38.0 31.7 

165 ........... 7APPENDECTOMY W COMPLICATED PRINCIPAL DIAG W/O CC .............................. 1.6862 38.0 31.7 

166 ........... 7APPENDECTOMY W/O COMPLICATED PRINCIPAL DIAG W CC .............................. 1.6862 38.0 31.7 

167 ........... 7APPENDECTOMY W/O COMPLICATED PRINCIPAL DIAG W/O CC .......................... 1.6862 38.0 31.7 

168 ........... 4 MOUTH PROCEDURES W CC ...................................................................................... 1.1679 29.6 24.7 

169 ........... 7 MOUTH PROCEDURES W/O CC .................................................................................. 0.7586 24.5 20.4 

23648 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

TABLE 11.—PROPOSED FY 2006 LTC–DRGS, RELATIVE WEIGHTS, GEOMETRIC AVERAGE LENGTH OF STAY, AND 5/6THS

OF THE GEOMETRIC AVERAGE LENGTH OF STAY—Continued 

LTC–DRG Description Relative 

weight 

Geometric 

average 

length of 

stay 

5/6ths of the 

geometric 

average 

length of 

stay 

170 ........... OTHER DIGESTIVE SYSTEM O.R. PROCEDURES W CC ............................................ 1.6319 35.9 29.9 

171 ........... 1OTHER DIGESTIVE SYSTEM O.R. PROCEDURES W/O CC ...................................... 0.4502 18.8 15.7 

172 ........... DIGESTIVE MALIGNANCY W CC .................................................................................... 0.8568 21.8 18.2 

173 ........... 2 DIGESTIVE MALIGNANCY W/O CC .............................................................................. 0.5834 21.0 17.5 

174 ........... G.I. HEMORRHAGE W CC ............................................................................................... 0.6984 22.0 18.3 

175 ........... 1G.I. HEMORRHAGE W/O CC ......................................................................................... 0.4502 18.8 15.7

176 ........... COMPLICATED PEPTIC ULCER ..................................................................................... 0.8510 21.5 17.9 

177 ........... 3 UNCOMPLICATED PEPTIC ULCER W CC ................................................................... 0.7586 24.5 20.4 

178 ........... 3 UNCOMPLICATED PEPTIC ULCER W/O CC ............................................................... 0.7586 24.5 20.4 

179 ........... INFLAMMATORY BOWEL DISEASE ............................................................................... 0.9834 24.1 20.1 

180 ........... G.I. OBSTRUCTION W CC ............................................................................................... 0.9417 23.5 19.6 

181 ........... 3G.I. OBSTRUCTION W/O CC ......................................................................................... 0.7586 24.5 20.4 

182 ........... ESOPHAGITIS, GASTROENT & MISC DIGEST DISORDERS AGE >17 W CC ............ 0.7753 22.6 18.8 

183 ........... ESOPHAGITIS, GASTROENT & MISC DIGEST DISORDERS AGE >17 W/O CC ........ 0.3959 17.2 14.3 

184 ........... 7ESOPHAGITIS, GASTROENT & MISC DIGEST DISORDERS AGE 0–17 ................... 0.4502 18.8 15.7 

185 ........... 3 DENTAL & ORAL DIS EXCEPT EXTRACTIONS & RESTORATIONS, AGE >17 ........ 0.7586 24.5 20.4 

186 ........... 7 DENTAL & ORAL DIS EXCEPT EXTRACTIONS & RESTORATIONS, AGE 0–17 ...... 0.7586 24.5 20.4 

187 ........... 7 DENTAL EXTRACTIONS & RESTORATIONS .............................................................. 0.7586 24.5 20.4 

188 ........... OTHER DIGESTIVE SYSTEM DIAGNOSES AGE >17 W CC ........................................ 1.0009 24.0 20 

189 ........... OTHER DIGESTIVE SYSTEM DIAGNOSES AGE >17 W/O CC .................................... 0.4730 18.2 15.2 

190 ........... 7OTHER DIGESTIVE SYSTEM DIAGNOSES AGE 0–17 ............................................... 0.4502 18.8 15.7 

191 ........... 4PANCREAS, LIVER & SHUNT PROCEDURES W CC .................................................. 1.1679 29.6 24.7 

192 ........... 7PANCREAS, LIVER & SHUNT PROCEDURES W/O CC .............................................. 1.1679 29.6 24.7 

193 ........... 3BILIARY TRACT PROC EXCEPT ONLY CHOLECYST W OR W/O C.D.E. W CC ...... 0.7586 24.5 20.4 

194 ........... 7BILIARY TRACT PROC EXCEPT ONLY CHOLECYST W OR W/O C.D.E. W/O CC .. 0.7586 24.5 20.4 

195 ........... 4 CHOLECYSTECTOMY W C.D.E. W CC ........................................................................ 1.1679 29.6 24.7 

196 ........... 7 CHOLECYSTECTOMY W C.D.E. W/O CC .................................................................... 0.7586 24.5 20.4 

197 ........... 3 CHOLECYSTECTOMY EXCEPT BY LAPAROSCOPE W/O C.D.E. W CC .................. 0.7586 24.5 20.4 

198 ........... 7 CHOLECYSTECTOMY EXCEPT BY LAPAROSCOPE W/O C.D.E. W/O CC .............. 0.7586 24.5 20.4 

199 ........... 7 HEPATOBILIARY DIAGNOSTIC PROCEDURE FOR MALIGNANCY ........................... 1.6862 38.0 31.7 

200 ........... 5 HEPATOBILIARY DIAGNOSTIC PROCEDURE FOR NON-MALIGNANCY ................. 1.6862 38.0 31.7 

201 ........... OTHER HEPATOBILIARY OR PANCREAS O.R. PROCEDURES .................................. 2.0391 36.1 30.1 

202 ........... CIRRHOSIS & ALCOHOLIC HEPATITIS ......................................................................... 0.6636 20.5 17.1 

203 ........... MALIGNANCY OF HEPATOBILIARY SYSTEM OR PANCREAS ................................... 0.7939 19.5 16.3 

204 ........... DISORDERS OF PANCREAS EXCEPT MALIGNANCY .................................................. 0.9564 22.9 19.1 

205 ........... DISORDERS OF LIVER EXCEPT MALIG,CIRR,ALC HEPA W CC ................................ 0.6709 20.6 17.2 

206 ........... 2 DISORDERS OF LIVER EXCEPT MALIG,CIRR,ALC HEPA W/O CC .......................... 0.5834 21.0 17.5 

207 ........... DISORDERS OF THE BILIARY TRACT W CC ................................................................ 0.7600 21.5 17.9 

208 ........... 2 DISORDERS OF THE BILIARY TRACT W/O CC .......................................................... 0.5834 21.0 17.5 

210 ........... 5 HIP & FEMUR PROCEDURES EXCEPT MAJOR JOINT AGE >17 W CC .................. 1.6862 38.0 31.7 

211 ........... 4 HIP & FEMUR PROCEDURES EXCEPT MAJOR JOINT AGE >17 W/O CC ............... 1.1679 29.6 24.7 

212 ........... 7 HIP & FEMUR PROCEDURES EXCEPT MAJOR JOINT AGE 0–17 ............................ 1.6862 38.0 31.7 

213 ........... AMPUTATION FOR MUSCULOSKELETAL SYSTEM & CONN TISSUE DISORDERS 1.2016 33.9 28.3 

216 ........... 4BIOPSIES OF MUSCULOSKELETAL SYSTEM & CONNECTIVE TISSUE .................. 1.1679 29.6 24.7 

217 ........... WND DEBRID & SKN GRFT EXCEPT HAND,FOR MUSCSKELET & CONN TISS DIS 1.2917 38.0 31.7 

218 ........... 5 LOWER EXTREM & HUMER PROC EXCEPT HIP,FOOT,FEMUR AGE >17 W CC ... 1.6862 38.0 31.7 

219 ........... 1 LOWER EXTREM & HUMER PROC EXCEPT HIP,FOOT,FEMUR AGE >17 W/O CC 0.4502 18.8 15.7 

220 ........... 7 LOWER EXTREM & HUMER PROC EXCEPT HIP,FOOT,FEMUR AGE 0–17 ............ 1.6862 38.0 31.7 

223 ........... 3 MAJOR SHOULDER/ELBOW PROC, OR OTHER UPPER EXTREMITY PROC W 

CC.

0.7586 24.5 20.4 

224 ........... 7SHOULDER,ELBOW OR FOREARM PROC,EXC MAJOR JOINT PROC, W/O CC .... 0.7586 24.5 20.4 

225 ........... FOOT PROCEDURES ...................................................................................................... 0.9996 28.9 24.1 

226 ........... SOFT TISSUE PROCEDURES W CC ............................................................................. 0.9487 30.0 25 

227 ........... 3SOFT TISSUE PROCEDURES W/O CC ....................................................................... 0.7586 24.5 20.4 

228 ........... 4 MAJOR THUMB OR JOINT PROC,OR OTH HAND OR WRIST PROC W CC ............ 1.1679 29.6 24.7 

229 ........... 7 HAND OR WRIST PROC, EXCEPT MAJOR JOINT PROC, W/O CC .......................... 0.4502 18.8 15.7 

230 ........... 5 LOCAL EXCISION & REMOVAL OF INT FIX DEVICES OF HIP & FEMUR ................ 1.6862 38.0 31.7 

232 ........... 7ARTHROSCOPY ............................................................................................................. 0.4502 18.8 15.7 

233 ........... OTHER MUSCULOSKELET SYS & CONN TISS O.R. PROC W CC ............................. 1.2832 33.9 28.3 

234 ........... 7OTHER MUSCULOSKELET SYS & CONN TISS O.R. PROC W/O CC ....................... 0.4502 18.8 15.7 

235 ........... 3FRACTURES OF FEMUR .............................................................................................. 0.7586 24.5 20.4 

236 ........... FRACTURES OF HIP & PELVIS ...................................................................................... 0.6553 25.2 21 

237 ........... 1SPRAINS, STRAINS, & DISLOCATIONS OF HIP, PELVIS & THIGH .......................... 0.4502 18.8 15.7 

238 ........... OSTEOMYELITIS .............................................................................................................. 0.8271 28.2 23.5 

239 ........... PATHOLOGICAL FRACTURES & MUSCULOSKELETAL & CONN TISS MALIGNANCY.0.6923 23.6 19.7 

240 ........... CONNECTIVE TISSUE DISORDERS W CC ................................................................... 0.7320 24.5 20.4 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23649 

TABLE 11.—PROPOSED FY 2006 LTC–DRGS, RELATIVE WEIGHTS, GEOMETRIC AVERAGE LENGTH OF STAY, AND 5/6THS

OF THE GEOMETRIC AVERAGE LENGTH OF STAY—Continued 

LTC–DRG Description Relative 

weight 

Geometric 

average 

length of 

stay 

5/6ths of the 

geometric 

average 

length of 

stay 

241 ........... 1 CONNECTIVE TISSUE DISORDERS W/O CC .............................................................. 0.4502 18.8 15.7 

242 ........... SEPTIC ARTHRITIS .......................................................................................................... 0.7931 26.6 22.2 

243 ........... MEDICAL BACK PROBLEMS ........................................................................................... 0.6107 23.4 19.5 

244 ........... BONE DISEASES & SPECIFIC ARTHROPATHIES W CC ............................................. 0.5280 22.2 18.5 

245 ........... BONE DISEASES & SPECIFIC ARTHROPATHIES W/O CC ......................................... 0.4651 20.4 17 

246 ........... 1 NON-SPECIFIC ARTHROPATHIES ............................................................................... 0.4502 18.8 15.7 

247 ........... SIGNS & SYMPTOMS OF MUSCULOSKELETAL SYSTEM & CONN TISSUE ............. 0.5269 21.4 17.8 

248 ........... TENDONITIS, MYOSITIS & BURSITIS ............................................................................ 0.6627 22.6 18.8 

249 ........... AFTERCARE, MUSCULOSKELETAL SYSTEM & CONNECTIVE TISSUE .................... 0.6614 24.7 20.6 

250 ........... 2FX, SPRN, STRN & DISL OF FOREARM, HAND, FOOT AGE >17 W CC .................. 0.5834 21.0 17.5 

251 ........... 1FX, SPRN, STRN & DISL OF FOREARM, HAND, FOOT AGE >17 W/O CC .............. 0.4502 18.8 15.7 

252 ........... 7FX, SPRN, STRN & DISL OF FOREARM, HAND, FOOT AGE 0–17 ........................... 0.7586 24.5 20.4 

253 ........... FX, SPRN, STRN & DISL OF UPARM,LOWLEG EX FOOT AGE >17 W CC ................ 0.6838 26.3 21.9 

254 ........... 1FX, SPRN, STRN & DISL OF UPARM,LOWLEG EX FOOT AGE >17 W/O CC .......... 0.4502 18.8 15.7 

255 ........... 7FX, SPRN, STRN & DISL OF UPARM,LOWLEG EX FOOT AGE 0–17 ....................... 0.7586 24.5 20.4 

256 ........... OTHER MUSCULOSKELETAL SYSTEM & CONNECTIVE TISSUE DIAGNOSES ........ 0.7953 25.3 21.1 

257 ........... 7TOTAL MASTECTOMY FOR MALIGNANCY W CC ...................................................... 0.7586 24.5 20.4 

258 ........... 7TOTAL MASTECTOMY FOR MALIGNANCY W/O CC .................................................. 0.7586 24.5 20.4 

259 ........... 2SUBTOTAL MASTECTOMY FOR MALIGNANCY W CC .............................................. 0.5834 21.0 17.5 

260 ........... 7SUBTOTAL MASTECTOMY FOR MALIGNANCY W/O CC ........................................... 0.7586 24.5 20.4 

261 ........... 7BREAST PROC FOR NON-MALIGNANCY EXCEPT BIOPSY & LOCAL EXCISION ... 0.7586 24.5 20.4 

262 ........... 1BREAST BIOPSY & LOCAL EXCISION FOR NON-MALIGNANCY .............................. 0.4502 18.8 15.7 

263 ........... SKIN GRAFT &/OR DEBRID FOR SKN ULCER OR CELLULITIS W CC ...................... 1.3245 39.4 32.8 

264 ........... SKIN GRAFT &/OR DEBRID FOR SKN ULCER OR CELLULITIS W/O CC ................... 0.9555 31.9 26.6 

265 ........... SKIN GRAFT &/OR DEBRID EXCEPT FOR SKIN ULCER OR CELLULITIS W CC ...... 1.0426 33.1 27.6 

266 ........... 3SKIN GRAFT &/OR DEBRID EXCEPT FOR SKIN ULCER OR CELLULITIS W/O CC 0.7586 24.5 20.4 

267 ........... 7PERIANAL & PILONIDAL PROCEDURES ..................................................................... 0.7586 24.5 20.4 

268 ........... 5SKIN, SUBCUTANEOUS TISSUE & BREAST PLASTIC PROCEDURES .................... 1.6862 38.0 31.7 

269 ........... OTHER SKIN, SUBCUT TISS & BREAST PROC W CC ................................................. 1.2945 35.9 29.9 

270 ........... 3OTHER SKIN, SUBCUT TISS & BREAST PROC W/O CC ........................................... 0.7586 24.5 20.4 

271 ........... SKIN ULCERS ................................................................................................................... 0.8707 27.6 23 

272 ........... MAJOR SKIN DISORDERS W CC ................................................................................... 0.7490 22.5 18.8 

273 ........... 1 MAJOR SKIN DISORDERS W/O CC ............................................................................. 0.4502 18.8 15.7 

274 ........... 3 MALIGNANT BREAST DISORDERS W CC .................................................................. 0.7586 24.5 20.4 

275 ........... 7 MALIGNANT BREAST DISORDERS W/O CC ............................................................... 0.7586 24.5 20.4 

276 ........... 2 NON-MALIGANT BREAST DISORDERS ....................................................................... 0.5834 21.0 17.5 

277 ........... CELLULITIS AGE >17 W CC ............................................................................................ 0.6281 20.9 17.4 

278 ........... CELLULITIS AGE >17 W/O CC ........................................................................................ 0.4440 17.8 14.8 

279 ........... 7 CELLULITIS AGE 0–17 .................................................................................................. 0.4502 18.8 15.7 

280 ........... TRAUMA TO THE SKIN, SUBCUT TISS & BREAST AGE >17 W CC ........................... 0.6728 24.3 20.3 

281 ........... 1TRAUMA TO THE SKIN, SUBCUT TISS & BREAST AGE >17 W/O CC ..................... 0.4502 18.8 15.7 

282 ........... 7TRAUMA TO THE SKIN, SUBCUT TISS & BREAST AGE 0–17 .................................. 0.4502 18.8 15.7 

283 ........... MINOR SKIN DISORDERS W CC .................................................................................... 0.6968 23.9 19.9 

284 ........... 1 MINOR SKIN DISORDERS W/O CC .............................................................................. 0.4502 18.8 15.7 

285 ........... AMPUTAT OF LOWER LIMB FOR ENDOCRINE,NUTRIT,& METABOL DISORDERS 1.3552 35.6 29.7 

286 ........... 7ADRENAL & PITUITARY PROCEDURES ..................................................................... 1.6862 38.0 31.7 

287 ........... SKIN GRAFTS & WOUND DEBRID FOR ENDOC, NUTRIT & METAB DISORDERS ... 1.1270 33.6 28 

288 ........... 4O.R. PROCEDURES FOR OBESITY ............................................................................. 1.1679 29.6 24.7 

289 ........... 7PARATHYROID PROCEDURES .................................................................................... 1.1679 29.6 24.7 

290 ........... 5THYROID PROCEDURES .............................................................................................. 1.6862 38.0 31.7 

291 ........... 7THYROGLOSSAL PROCEDURES ................................................................................. 1.1679 29.6 24.7 

292 ........... OTHER ENDOCRINE, NUTRIT & METAB O.R. PROC W CC ........................................ 1.3437 31.7 26.4 

293 ........... 2OTHER ENDOCRINE, NUTRIT & METAB O.R. PROC W/O CC .................................. 0.5834 21.0 17.5 

294 ........... DIABETES AGE >35 ......................................................................................................... 0.7330 24.8 20.7 

295 ........... 3 DIABETES AGE 0–35 ..................................................................................................... 0.7586 24.5 20.4 

296 ........... NUTRITIONAL & MISC METABOLIC DISORDERS AGE >17 W CC ............................. 0.7232 23.1 19.3 

297 ........... NUTRITIONAL & MISC METABOLIC DISORDERS AGE >17 W/O CC .......................... 0.5262 18.4 15.3 

298 ........... 7 NUTRITIONAL & MISC METABOLIC DISORDERS AGE 0–17 .................................... 0.5834 21.0 17.5 

299 ........... 4 INBORN ERRORS OF METABOLISM ........................................................................... 1.1679 29.6 24.7 

300 ........... ENDOCRINE DISORDERS W CC .................................................................................... 0.6413 21.2 17.7 

301 ........... 1ENDOCRINE DISORDERS W/O CC .............................................................................. 0.4502 18.8 15.7 

302 ........... 6KIDNEY TRANSPLANT .................................................................................................. 0.0000 1.0 0.8 

303 ........... 4KIDNEY,URETER & MAJOR BLADDER PROCEDURES FOR NEOPLASM ............... 1.1679 29.6 24.7 

304 ........... 5KIDNEY,URETER & MAJOR BLADDER PROC FOR NON-NEOPL W CC .................. 1.6862 38.0 31.7 

305 ........... 1KIDNEY,URETER & MAJOR BLADDER PROC FOR NON-NEOPL W/O CC .............. 0.4502 18.8 15.7 

306 ........... 2PROSTATECTOMY W CC ............................................................................................. 0.5834 21.0 17.5

307 ........... 7PROSTATECTOMY W/O CC ......................................................................................... 0.5834 21.0 17.5 

23650 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

TABLE 11.—PROPOSED FY 2006 LTC–DRGS, RELATIVE WEIGHTS, GEOMETRIC AVERAGE LENGTH OF STAY, AND 5/6THS

OF THE GEOMETRIC AVERAGE LENGTH OF STAY—Continued 

LTC–DRG Description Relative 

weight 

Geometric 

average 

length of 

stay 

5/6ths of the 

geometric 

average 

length of 

stay 

308 ........... 4 MINOR BLADDER PROCEDURES W CC ..................................................................... 1.1679 29.6 24.7 

309 ........... 7 MINOR BLADDER PROCEDURES W/O CC ................................................................. 1.1679 29.6 24.7 

310 ........... 4TRANSURETHRAL PROCEDURES W CC .................................................................... 1.1679 29.6 24.7 

311 ........... 7TRANSURETHRAL PROCEDURES W/O CC ................................................................ 1.1679 29.6 24.7 

312 ........... 1 URETHRAL PROCEDURES, AGE >17 W CC ............................................................... 0.4502 18.8 15.7 

313 ........... 7 URETHRAL PROCEDURES, AGE >17 W/O CC ........................................................... 0.4502 18.8 15.7 

314 ........... 7 URETHRAL PROCEDURES, AGE 0–17 ........................................................................ 0.4502 18.8 15.7 

315 ........... OTHER KIDNEY & URINARY TRACT O.R. PROCEDURES .......................................... 1.4005 31.5 26.3 

316 ........... RENAL FAILURE .............................................................................................................. 0.8208 22.6 18.8 

317 ........... ADMIT FOR RENAL DIALYSIS ........................................................................................ 1.0001 25.5 21.3 

318 ........... KIDNEY & URINARY TRACT NEOPLASMS W CC ......................................................... 0.7648 20.2 16.8 

319 ........... 1KIDNEY & URINARY TRACT NEOPLASMS W/O CC ................................................... 0.4502 18.8 15.7 

320 ........... KIDNEY & URINARY TRACT INFECTIONS AGE >17 W CC ......................................... 0.6185 22.1 18.4 

321 ........... KIDNEY & URINARY TRACT INFECTIONS AGE >17 W/O CC ..................................... 0.4813 19.0 15.8 

322 ........... 7KIDNEY & URINARY TRACT INFECTIONS AGE 0–17 ................................................ 0.4502 18.8 15.7 

323 ........... 4 URINARY STONES W CC, &/OR ESW LITHOTRIPSY ................................................ 1.1679 29.6 24.7 

324 ........... 7 URINARY STONES W/O CC .......................................................................................... 0.4502 18.8 15.7

325 ........... 2KIDNEY & URINARY TRACT SIGNS & SYMPTOMS AGE >17 W CC ........................ 0.5834 21.0 17.5 

326 ........... 1KIDNEY & URINARY TRACT SIGNS & SYMPTOMS AGE >17 W/O CC .................... 0.4502 18.8 15.7 

327 ........... 7KIDNEY & URINARY TRACT SIGNS & SYMPTOMS AGE 0–17 ................................. 0.4502 18.8 15.7 

328 ........... 1 URETHRAL STRICTURE AGE >17 W CC .................................................................... 0.4502 18.8 15.7 

329 ........... 7 URETHRAL STRICTURE AGE >17 W/O CC ................................................................. 0.4502 18.8 15.7 

330 ........... 7 URETHRAL STRICTURE AGE 0–17 ............................................................................. 0.4502 18.8 15.7 

331 ........... OTHER KIDNEY & URINARY TRACT DIAGNOSES AGE >17 W CC ............................ 0.8033 23.0 19.2 

332 ........... 3OTHER KIDNEY & URINARY TRACT DIAGNOSES AGE >17 W/O CC ...................... 0.7586 24.5 20.4 

333 ........... 7OTHER KIDNEY & URINARY TRACT DIAGNOSES AGE 0–17 ................................... 0.7586 24.5 20.4 

334 ........... 2 MAJOR MALE PELVIC PROCEDURES W CC .............................................................. 0.5834 21.0 17.5 

335 ........... 7 MAJOR MALE PELVIC PROCEDURES W/O CC .......................................................... 1.6862 38.0 31.7 

336 ........... 2TRANSURETHRAL PROSTATECTOMY W CC ............................................................. 0.5834 21.0 17.5 

337 ........... 7TRANSURETHRAL PROSTATECTOMY W/O CC ......................................................... 0.5834 21.0 17.5 

338 ........... 7TESTES PROCEDURES, FOR MALIGNANCY ............................................................. 0.5834 21.0 17.5 

339 ........... 4TESTES PROCEDURES, NON-MALIGNANCY AGE >17 ............................................. 1.1679 29.6 24.7 

340 ........... 7TESTES PROCEDURES, NON-MALIGNANCY AGE 0–17 ........................................... 1.1679 29.6 24.7 

341 ........... 4PENIS PROCEDURES ................................................................................................... 1.1679 29.6 24.7 

342 ........... 7 CIRCUMCISION AGE >17 .............................................................................................. 1.1679 29.6 24.7 

343 ........... 7 CIRCUMCISION AGE 0–17 ............................................................................................ 1.1679 29.6 24.7 

344 ........... 1OTHER MALE REPRODUCTIVE SYSTEM O.R. PROCEDURES FOR MALIGNANCY 0.4502 18.8 15.7 

345 ........... 5OTHER MALE REPRODUCTIVE SYSTEM O.R. PROC EXCEPT FOR MALIGNANCY.1.6862 38.0 31.7 

346 ........... MALIGNANCY, MALE REPRODUCTIVE SYSTEM, W CC ............................................. 0.6105 20.6 17.2 

347 ........... 2 MALIGNANCY, MALE REPRODUCTIVE SYSTEM, W/O CC ....................................... 0.5834 21.0 17.5 

348 ........... 2BENIGN PROSTATIC HYPERTROPHY W CC .............................................................. 0.5834 21.0 17.5 

349 ........... 7BENIGN PROSTATIC HYPERTROPHY W/O CC .......................................................... 1.1679 29.6 24.7 

350 ........... INFLAMMATION OF THE MALE REPRODUCTIVE SYSTEM ........................................ 0.6562 21.6 18 

351 ........... 7STERILIZATION, MALE .................................................................................................. 1.1679 29.6 24.7 

352 ........... OTHER MALE REPRODUCTIVE SYSTEM DIAGNOSES ............................................... 0.6360 23.4 19.5 

353 ........... 7PELVIC EVISCERATION, RADICAL HYSTERECTOMY & RADICAL VULVECTOMY 1.1679 29.6 24.7 

354 ........... 7 UTERINE,ADNEXA PROC FOR NON-OVARIAN/ADNEXAL MALIG W CC ................. 1.1679 29.6 24.7 

355 ........... 7 UTERINE,ADNEXA PROC FOR NON-OVARIAN/ADNEXAL MALIG W/O CC ............. 1.1679 29.6 24.7 

356 ........... 7FEMALE REPRODUCTIVE SYSTEM RECONSTRUCTIVE PROCEDURES ............... 1.1679 29.6 24.7 

357 ........... 7 UTERINE & ADNEXA PROC FOR OVARIAN OR ADNEXAL MALIGNANCY .............. 1.1679 29.6 24.7 

358 ........... 7 UTERINE & ADNEXA PROC FOR NON-MALIGNANCY W CC .................................... 1.1679 29.6 24.7 

359 ........... 7 UTERINE & ADNEXA PROC FOR NON-MALIGNANCY W/O CC ................................ 1.1679 29.6 24.7 

360 ........... 4VAGINA, CERVIX & VULVA PROCEDURES ................................................................ 1.1679 29.6 24.7 

361 ........... 7 LAPAROSCOPY & INCISIONAL TUBAL INTERRUPTION ........................................... 1.1679 29.6 24.7 

362 ........... 7ENDOSCOPIC TUBAL INTERRUPTION ....................................................................... 1.1679 29.6 24.7 

363 ........... 7 D&C, CONIZATION & RADIO-IMPLANT, FOR MALIGNANCY ..................................... 1.1679 29.6 24.7 

364 ........... 5 D&C, CONIZATION EXCEPT FOR MALIGNANCY ....................................................... 1.6862 38.0 31.7 

365 ........... 5OTHER FEMALE REPRODUCTIVE SYSTEM O.R. PROCEDURES ............................ 1.6862 38.0 31.7 

366 ........... MALIGNANCY, FEMALE REPRODUCTIVE SYSTEM W CC .......................................... 0.7126 20.3 16.9 

367 ........... 7 MALIGNANCY, FEMALE REPRODUCTIVE SYSTEM W/O CC .................................... 1.1679 29.6 24.7 

368 ........... INFECTIONS, FEMALE REPRODUCTIVE SYSTEM ....................................................... 0.6455 20.7 17.3 

369 ........... 3 MENSTRUAL & OTHER FEMALE REPRODUCTIVE SYSTEM DISORDERS ............. 0.7586 24.5 20.4 

370 ........... 7 CESAREAN SECTION W CC ......................................................................................... 0.7586 24.5 20.4 

371 ........... 7 CESAREAN SECTION W/O CC ..................................................................................... 0.5834 21.0 17.5 

372 ........... 7VAGINAL DELIVERY W COMPLICATING DIAGNOSES .............................................. 1.1679 29.6 24.7 

373 ........... 7VAGINAL DELIVERY W/O COMPLICATING DIAGNOSES ........................................... 1.1679 29.6 24.7 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23651 

TABLE 11.—PROPOSED FY 2006 LTC–DRGS, RELATIVE WEIGHTS, GEOMETRIC AVERAGE LENGTH OF STAY, AND 5/6THS

OF THE GEOMETRIC AVERAGE LENGTH OF STAY—Continued 

LTC–DRG Description Relative 

weight 

Geometric 

average 

length of 

stay 

5/6ths of the 

geometric 

average 

length of 

stay 

374 ........... 7VAGINAL DELIVERY W STERILIZATION &/OR D&C ................................................... 1.1679 29.6 24.7 

375 ........... 7VAGINAL DELIVERY W O.R. PROC EXCEPT STERIL &/OR D&C ............................. 1.1679 29.6 24.7 

376 ........... 7POSTPARTUM & POST ABORTION DIAGNOSES W/O O.R. PROCEDURE ............. 1.1679 29.6 24.7 

377 ........... 7POSTPARTUM & POST ABORTION DIAGNOSES W O.R. PROCEDURE ................. 1.1679 29.6 24.7 

378 ........... 7ECTOPIC PREGNANCY ................................................................................................. 0.7586 24.5 20.4 

379 ........... 7THREATENED ABORTION ............................................................................................ 1.1679 29.6 24.7

380 ........... 7ABORTION W/O D&C ..................................................................................................... 1.1679 29.6 24.7 

381 ........... 7ABORTION W D&C, ASPIRATION CURETTAGE OR HYSTEROTOMY ...................... 1.1679 29.6 24.7 

382 ........... 7FALSE LABOR ................................................................................................................ 1.1679 29.6 24.7 

383 ........... 7OTHER ANTEPARTUM DIAGNOSES W MEDICAL COMPLICATIONS ....................... 1.1679 29.6 24.7 

384 ........... 7OTHER ANTEPARTUM DIAGNOSES W/O MEDICAL COMPLICATIONS ................... 1.1679 29.6 24.7 

385 ........... 7 NEONATES, DIED OR TRANSFERRED TO ANOTHER ACUTE CARE FACILITY ..... 1.1679 29.6 24.7 

386 ........... 7EXTREME IMMATURITY OR RESPIRATORY DISTRESS SYNDROME, NEONATE 1.1679 29.6 24.7 

387 ........... 7PREMATURITY W MAJOR PROBLEMS ....................................................................... 1.1679 29.6 24.7 

388 ........... 7PREMATURITY W/O MAJOR PROBLEMS ................................................................... 1.1679 29.6 24.7 

389 ........... 7FULL TERM NEONATE W MAJOR PROBLEMS .......................................................... 1.1679 29.6 24.7 

390 ........... 7 NEONATE W OTHER SIGNIFICANT PROBLEMS ........................................................ 1.1679 29.6 24.7 

391 ........... 7 NORMAL NEWBORN ..................................................................................................... 1.1679 29.6 24.7 

392 ........... 7SPLENECTOMY AGE >17 ............................................................................................. 0.7586 24.5 20.4 

393 ........... 7SPLENECTOMY AGE 0–17 ........................................................................................... 0.7586 24.5 20.4 

394 ........... 5OTHER O.R. PROCEDURES OF THE BLOOD AND BLOOD FORMING ORGANS ... 1.6862 38.0 31.7 

395 ........... RED BLOOD CELL DISORDERS AGE >17 ..................................................................... 0.6611 21.8 18.2 

396 ........... 7 RED BLOOD CELL DISORDERS AGE 0–17 ................................................................ 0.5834 21.0 17.5 

397 ........... COAGULATION DISORDERS .......................................................................................... 0.8665 22.5 18.8 

398 ........... RETICULOENDOTHELIAL & IMMUNITY DISORDERS W CC ....................................... 0.8193 23.5 19.6 

399 ........... 2 RETICULOENDOTHELIAL & IMMUNITY DISORDERS W/O CC .................................. 0.5834 21.0 17.5 

401 ........... 5 LYMPHOMA & NON-ACUTE LEUKEMIA W OTHER O.R. PROC W CC ..................... 1.6862 38.0 31.7 

402 ........... 7 LYMPHOMA & NON-ACUTE LEUKEMIA W OTHER O.R. PROC W/O CC ................. 0.5834 21.0 17.5 

403 ........... LYMPHOMA & NON-ACUTE LEUKEMIA W CC .............................................................. 0.8844 21.3 17.8 

404 ........... 2 LYMPHOMA & NON-ACUTE LEUKEMIA W/O CC ........................................................ 0.5834 21.0 17.5 

405 ........... 7ACUTE LEUKEMIA W/O MAJOR O.R. PROCEDURE AGE 0–17 ................................ 0.5834 21.0 17.5 

406 ........... 4 MYELOPROLIF DISORD OR POORLY DIFF NEOPL W MAJ O.R.PROC W CC ........ 1.1679 29.6 24.7 

407 ........... 7 MYELOPROLIF DISORD OR POORLY DIFF NEOPL W MAJ O.R.PROC W/O CC .... 1.1679 29.6 24.7 

408 ........... 4 MYELOPROLIF DISORD OR POORLY DIFF NEOPL W OTHER O.R.PROC ............. 1.1679 29.6 24.7 

409 ........... RADIOTHERAPY .............................................................................................................. 0.8567 23.4 19.5 

410 ........... CHEMOTHERAPY W/O ACUTE LEUKEMIA AS SECONDARY DIAGNOSIS ................ 1.1719 26.4 22 

411 ........... 7 HISTORY OF MALIGNANCY W/O ENDOSCOPY ......................................................... 1.1679 29.6 24.7 

412 ........... 7 HISTORY OF MALIGNANCY W ENDOSCOPY ............................................................. 1.1679 29.6 24.7 

413 ........... OTHER MYELOPROLIF DIS OR POORLY DIFF NEOPL DIAG W CC .......................... 0.8990 20.5 17.1 

414 ........... 7OTHER MYELOPROLIF DIS OR POORLY DIFF NEOPL DIAG W/O CC .................... 0.5834 21.0 17.5 

415 ........... O.R. PROCEDURE FOR INFECTIOUS & PARASITIC DISEASES ................................ 1.4237 35.5 29.6 

416 ........... SEPTICEMIA AGE >17 ..................................................................................................... 0.8255 23.4 19.5 

417 ........... 7SEPTICEMIA AGE 0–17 ................................................................................................. 0.7586 24.5 20.4 

418 ........... POSTOPERATIVE & POST-TRAUMATIC INFECTIONS ................................................. 0.8296 24.7 20.6 

419 ........... 3FEVER OF UNKNOWN ORIGIN AGE >17 W CC ......................................................... 0.7586 24.5 20.4 

420 ........... 7FEVER OF UNKNOWN ORIGIN AGE >17 W/O CC ..................................................... 0.7586 24.5 20.4 

421 ........... VIRAL ILLNESS AGE >17 ................................................................................................ 0.9474 27.3 22.8 

422 ........... 7VIRAL ILLNESS & FEVER OF UNKNOWN ORIGIN AGE 0–17 ................................... 0.4502 18.8 15.7 

423 ........... OTHER INFECTIOUS & PARASITIC DISEASES DIAGNOSES ...................................... 0.9403 21.7 18.1 

424 ........... 3O.R. PROCEDURE W PRINCIPAL DIAGNOSES OF MENTAL ILLNESS .................... 0.7586 24.5 20.4 

425 ........... 2ACUTE ADJUSTMENT REACTION & PSYCHOLOGICAL DYSFUNCTION ................. 0.5834 21.0 17.5 

426 ........... DEPRESSIVE NEUROSES .............................................................................................. 0.4131 20.7 17.3 

427 ........... NEUROSES EXCEPT DEPRESSIVE ............................................................................... 0.4713 23.8 19.8 

428 ........... 1 DISORDERS OF PERSONALITY & IMPULSE CONTROL ........................................... 0.4502 18.8 15.7 

429 ........... ORGANIC DISTURBANCES & MENTAL RETARDATION .............................................. 0.5831 26.5 22.1 

430 ........... PSYCHOSES .................................................................................................................... 0.4350 24.1 20.1 

431 ........... 1 CHILDHOOD MENTAL DISORDERS ............................................................................. 0.4502 18.8 15.7 

432 ........... 2OTHER MENTAL DISORDER DIAGNOSES .................................................................. 0.5834 21.0 17.5 

433 ........... 2ALCOHOL/DRUG ABUSE OR DEPENDENCE, LEFT AMA .......................................... 0.5834 21.0 17.5 

439 ........... SKIN GRAFTS FOR INJURIES ........................................................................................ 1.3758 35.6 29.7 

440 ........... WOUND DEBRIDEMENTS FOR INJURIES ..................................................................... 1.3261 35.9 29.9 

441 ........... 1 HAND PROCEDURES FOR INJURIES ......................................................................... 0.4502 18.8 15.7 

442 ........... OTHER O.R. PROCEDURES FOR INJURIES W CC ...................................................... 1.4028 33.4 27.8 

443 ........... 3OTHER O.R. PROCEDURES FOR INJURIES W/O CC ................................................ 0.7586 24.5 20.4 

444 ........... TRAUMATIC INJURY AGE >17 W CC ............................................................................. 0.7551 25.9 21.6 

445 ........... 1TRAUMATIC INJURY AGE >17 W/O CC ....................................................................... 0.4502 18.8 15.7 

446 ........... 7TRAUMATIC INJURY AGE 0–17 ................................................................................... 0.4502 18.8 15.7 

23652 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

TABLE 11.—PROPOSED FY 2006 LTC–DRGS, RELATIVE WEIGHTS, GEOMETRIC AVERAGE LENGTH OF STAY, AND 5/6THS

OF THE GEOMETRIC AVERAGE LENGTH OF STAY—Continued 

LTC–DRG Description Relative 

weight 

Geometric 

average 

length of 

stay 

5/6ths of the 

geometric 

average 

length of 

stay 

447 ........... 2ALLERGIC REACTIONS AGE >17 ................................................................................. 0.5834 21.0 17.5 

448 ........... 7ALLERGIC REACTIONS AGE 0–17 ............................................................................... 0.5834 21.0 17.5 

449 ........... 3POISONING & TOXIC EFFECTS OF DRUGS AGE >17 W CC ................................... 0.7586 24.5 20.4 

450 ........... 7POISONING & TOXIC EFFECTS OF DRUGS AGE >17 W/O CC ................................ 0.7586 24.5 20.4 

451 ........... 7POISONING & TOXIC EFFECTS OF DRUGS AGE 0–17 ............................................. 0.7586 24.5 20.4 

452 ........... COMPLICATIONS OF TREATMENT W CC ..................................................................... 0.9139 25.2 21 

453 ........... COMPLICATIONS OF TREATMENT W/O CC ................................................................. 0.5449 23.2 19.3 

454 ........... 3OTHER INJURY, POISONING & TOXIC EFFECT DIAG W CC ................................... 0.7586 24.5 20.4 

455 ........... 7OTHER INJURY, POISONING & TOXIC EFFECT DIAG W/O CC ................................ 0.7586 24.5 20.4 

461 ........... O.R. PROC W DIAGNOSES OF OTHER CONTACT W HEALTH SERVICES ............... 1.2315 34.0 28.3 

462 ........... REHABILITATION ............................................................................................................. 0.5815 22.4 18.7 

463 ........... SIGNS & SYMPTOMS W CC ........................................................................................... 0.6234 23.7 19.8 

464 ........... SIGNS & SYMPTOMS W/O CC ....................................................................................... 0.5565 24.1 20.1 

465 ........... AFTERCARE W HISTORY OF MALIGNANCY AS SECONDARY DIAGNOSIS ............. 0.6959 21.8 18.2 

466 ........... AFTERCARE W/O HISTORY OF MALIGNANCY AS SECONDARY DIAGNOSIS ......... 0.6713 21.9 18.3 

467 ........... 3OTHER FACTORS INFLUENCING HEALTH STATUS ................................................. 0.7586 24.5 20.4 

468 ........... EXTENSIVE O.R. PROCEDURE UNRELATED TO PRINCIPAL DIAGNOSIS ............... 2.1439 40.0 33.3 

469 ........... 6PRINCIPAL DIAGNOSIS INVALID AS DISCHARGE DIAGNOSIS ................................ 0.0000 1.0 0.8 

470 ........... 6 UNGROUPABLE ............................................................................................................. 0.0000 1.0 0.8 

471 ........... 5BILATERAL OR MULTIPLE MAJOR JOINT PROCS OF LOWER EXTREMITY .......... 1.6862 38.0 31.7 

473 ........... ACUTE LEUKEMIA W/O MAJOR O.R. PROCEDURE AGE >17 .................................... 0.8580 20.0 16.7 

475 ........... RESPIRATORY SYSTEM DIAGNOSIS WITH VENTILATOR SUPPORT ....................... 2.0848 34.5 28.8 

476 ........... 4PROSTATIC O.R. PROCEDURE UNRELATED TO PRINCIPAL DIAGNOSIS ............. 1.1679 29.6 24.7 

477 ........... NON-EXTENSIVE O.R. PROCEDURE UNRELATED TO PRINCIPAL DIAGNOSIS ...... 1.5867 35.2 29.3 

478 ........... OTHER VASCULAR PROCEDURES W CC .................................................................... 1.3338 30.7 25.6 

479 ........... 7OTHER VASCULAR PROCEDURES W/O CC .............................................................. 1.1679 29.6 24.7 

480 ........... 6 LIVER TRANSPLANT ..................................................................................................... 0.0000 1.0 0.8 

481 ........... 7BONE MARROW TRANSPLANT ................................................................................... 1.6862 38.0 31.7 

482 ........... 3TRACHEOSTOMY FOR FACE, MOUTH & NECK DIAGNOSES .................................. 0.7586 24.5 20.4 

484 ........... 2 CRANIOTOMY FOR MULTIPLE SIGNIFICANT TRAUMA ............................................ 0.5834 21.0 17.5 

485 ........... 7 LIMB REATTACHMENT, HIP AND FEMUR PROC FOR MULTIPLE SIGNIFICANT 

TR.

0.7586 24.5 20.4 

486 ........... 5OTHER O.R. PROCEDURES FOR MULTIPLE SIGNIFICANT TRAUMA ..................... 1.6862 38.0 31.7 

487 ........... OTHER MULTIPLE SIGNIFICANT TRAUMA ................................................................... 0.9046 26.0 21.7 

488 ........... 5 HIV W EXTENSIVE O.R. PROCEDURE ........................................................................ 1.6862 38.0 31.7 

489 ........... HIV W MAJOR RELATED CONDITION ........................................................................... 0.8348 21.1 17.6 

490 ........... HIV W OR W/O OTHER RELATED CONDITION ............................................................ 0.5012 16.4 13.7 

491 ........... 5 MAJOR JOINT & LIMB REATTACHMENT PROCEDURES OF UPPER EXTREMITY 1.6862 38.0 31.7 

492 ........... 7 CHEMOTHERAPY W ACUTE LEUKEMIA OR W USE OF HI DOSE CHEMOAGENT 1.6862 38.0 31.7 

493 ........... 4 LAPAROSCOPIC CHOLECYSTECTOMY W/O C.D.E. W CC ....................................... 1.1679 29.6 24.7 

494 ........... 7 LAPAROSCOPIC CHOLECYSTECTOMY W/O C.D.E. W/O CC ................................... 1.1679 29.6 24.7 

495 ........... 6 LUNG TRANSPLANT ...................................................................................................... 0.0000 1.0 0.8 

496 ........... 7 COMBINED ANTERIOR/POSTERIOR SPINAL FUSION ............................................... 1.1679 29.6 24.7 

497 ........... 4SPINAL FUSION W CC .................................................................................................. 1.1679 29.6 24.7 

498 ........... 7SPINAL FUSION EXCEPT CERVICAL W/O CC ............................................................ 1.1679 29.6 24.7 

499 ........... 5BACK & NECK PROCEDURES EXCEPT SPINAL FUSION W CC .............................. 1.6862 38.0 31.7 

500 ........... 4BACK & NECK PROCEDURES EXCEPT SPINAL FUSION W/O CC .......................... 1.1679 29.6 24.7 

501 ........... 5KNEE PROCEDURES W PDX OF INFECTION W CC ................................................. 1.6862 38.0 31.7 

502 ........... 4KNEE PROCEDURES W PDX OF INFECTION W/O CC .............................................. 1.1679 29.6 24.7 

503 ........... 2KNEE PROCEDURES W/O PDX OF INFECTION ......................................................... 0.5834 21.0 17.5 

504 ........... 7EXTENSIVE BURNS OF FULL THICKNESS BURNS WITH MECH VENT 96+HRS 

WITH SKIN GRAFT.

1.6862 38.0 31.7 

505 ........... 4EXTENSIVE BURN OR FULL THICKNESS BURNS WITH MECH VENT 96+ HOURS 

WITHOUT SKIN GRAFT.

1.1679 29.6 24.7 

506 ........... 4FULL THICKNESS BURN W SKIN GRAFT OR INHAL INJ W CC OR SIG TRAUMA 1.1679 29.6 24.7 

507 ........... 3FULL THICKNESS BURN W SKIN GRFT OR INHAL INJ W/O CC OR SIG TRAUMA 0.7586 24.5 20.4 

508 ........... FULL THICKNESS BURN W/O SKIN GRFT OR INHAL INJ W CC OR SIG TRAUMA .. 0.8403 29.4 24.5 

509 ........... 1FULL THICKNESS BURN W/O SKIN GRFT OR INH INJ W/O CC OR SIG TRAUMA 0.4502 18.8 15.7 

510 ........... NON-EXTENSIVE BURNS W CC OR SIGNIFICANT TRAUMA ...................................... 0.7737 24.6 20.5 

511 ........... 1 NON-EXTENSIVE BURNS W/O CC OR SIGNIFICANT TRAUMA ................................ 0.4502 18.8 15.7 

512 ........... 6SIMULTANEOUS PANCREAS/KIDNEY TRANSPLANT ................................................ 0.0000 1.0 0.8 

513 ........... 6PANCREAS TRANSPLANT ............................................................................................ 0.0000 1.0 0.8 

515 ........... 5 CARDIAC DEFIBRILATOR IMPLANT W/O CARDIAC CATH ........................................ 1.6862 38.0 31.7 

517 ........... 5PERCUTANEOUS CARDIVASCULAR PROC W NON-DRUG ELUTING STENT W/O 

AMI.

1.6862 38.0 31.7 

518 ........... 3PERCUTANEOUS CARDIVASCULAR PROC W/O CORONARY ARTERY STENT 

OR AMI.

0.7586 24.5 20.4 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23653 

TABLE 11.—PROPOSED FY 2006 LTC–DRGS, RELATIVE WEIGHTS, GEOMETRIC AVERAGE LENGTH OF STAY, AND 5/6THS

OF THE GEOMETRIC AVERAGE LENGTH OF STAY—Continued 

LTC–DRG Description Relative 

weight 

Geometric 

average 

length of 

stay 

5/6ths of the 

geometric 

average 

length of 

stay 

519 ........... 5 CERVICAL SPINAL FUSION W CC ............................................................................... 1.6862 38.0 31.7 

520 ........... 7 CERVICAL SPINAL FUSION W/O CC ........................................................................... 1.1679 29.6 24.7 

521 ........... ALCOHOL/DRUG ABUSE OR DEPENDENCE W CC ..................................................... 0.4533 19.8 16.5 

522 ........... 7ALCOHOL/DRUG ABUSE OR DEPENDENCE W REHABILITATION THERAPY W/O 

CC.

0.4502 18.8 15.7 

523 ........... 7ALCOHOL/DRUG ABUSE OR DEPENDENCE W/O REHABILITATION THERAPY W/ 

O CC.

0.4502 18.8 15.7 

524 ........... TRANSIENT ISCHEMIA .................................................................................................... 0.5069 21.1 17.6 

525 ........... 7OTHER HEART ASSIST SYSTEM IMPLANT ................................................................ 1.6862 38.0 31.7 

527 ........... 5PERCUTANEOUS CARVIOVASCULAR PROC W DRUG-ELUTING STENT W/O AMI 1.6862 38.0 31.7 

528 ........... 7 INTRACRANIAL VASCULAR PROC W PDX HEMORRHAGE ...................................... 1.6862 38.0 31.7 

529 ........... 5VENTRICULAR SHUNT PROCEDURES W CC ............................................................ 1.6862 38.0 31.7 

530 ........... 7VENTRICULAR SHUNT PROCEDURES W/O CC ........................................................ 1.6862 38.0 31.7 

531 ........... 3SPINAL PROCEDURES WITH CC ................................................................................ 0.7586 24.5 20.4 

532 ........... 8SPINAL PROCEDURES WITHOUT CC ......................................................................... 0.7586 24.5 20.4 

533 ........... 5EXTRACRANIAL VASCULAR PROCEDURES WITH CC ............................................. 1.6862 38.0 31.7 

534 ........... 7EXTRACRANIAL PROCEDURES W/O CC .................................................................... 1.1679 29.6 24.7 

535 ........... 7 CARDIAC DEFIB IMPLANT W CARDIAC CATH W AMI/HF/SHOCK ........................... 1.6862 38.0 31.7 

536 ........... 7 CARDIAC DEFIB IMPLANT W CARDIAC CATH W/O AMI/HF/SHOCK ....................... 1.6862 38.0 31.7 

537 ........... LOCAL EXCISION AND REMOVAL OF INTERNAL FIXATION DEVICES EXCEPT HIP 

AND FEMUR WITH CC.

1.1670 34.6 28.8 

538 ........... 7 LOCAL EXCISION AND REMOVAL OF INTERNAL FIXATION DEVICES EXCEPT 

HIP AND FEMUR WITHOUT CC.

1.1679 29.6 24.7 

539 ........... 4 LYMPHOMA AND LEUKEMIA WITH MAJOR O.R. PROCEDURE WITH CC .............. 1.1679 29.6 24.7 

540 ........... 7 LYMPHOMA & LEUKEMIA W MAJOR OR PROCEDURE W/O CC ............................. 0.5834 21.0 17.5 

541 ........... ECMO OR TRACH W MECH VENT 96+ HRS OR PDX EXCEPT FACE, MOUTH & 

NECK DIAG WITH MAJOR OR.

4.2566 65.6 54.7 

542 ........... TRACH W MECH VENT 96+ HRS OR PDX EXCEPT FACE, MOUTH & NECK DIAG 

WITHOUT MAJOR OR.

3.1821 47.9 39.9 

543 ........... 5 CRANIOTOMY W IMPLANT OF CHEMO AGENT OR ACUTE COMPLEX CNS PDX 1.6862 38.0 31.7 

544 ........... 5 MAJOR JOINT REPLACEMENT OR REATTACHMENT OF LOWER EXTREMITY ..... 1.6862 38.0 31.7 

545 ........... 5 REVISION OF HIP OR KNEE REPLACEMENT ............................................................ 1.6862 38.0 31.7 

546 ........... 7SPINAL FUSION EXCEPT CERVICAL WITH PRINCIPAL DIAGNOSIS OF CURVATURE OF SPINE OR MALIGNANCY.1.6862 38.0 31.7 

547 ........... 7PERCUTANEOUS CARDIOVASCULAR PROCEDURE WITH AMI WITH CC ............. 1.6862 38.0 31.7 

548 ........... 7PERCUTANEOUS CARDIOVASCULAR PROCEDURE WITH AMI WITHOUT CC ...... 1.6862 38.0 31.7 

549 ........... 7PERCUTANEOUS CARDIOVASCULAR PROCEDURE WITH DRUG-ELUTING 

STENT WITH AMI WITH CC.

1.6862 38.0 31.7 

550 ........... 7PERCUTANEOUS CARDIOVASCULAR PROCEDURE WITH DRUG-ELUTING 

STENT WITH AMI WITHOUT CC.

1.6862 38.0 31.7 

1Proposed relative weights for these proposed LTC–DRGs were determined by assigning these cases to proposed low-volume quintile 1. 2Proposed relative weights for these proposed LTC–DRGs were determined by assigning these cases to proposed low-volume quintile 2. 3Proposed relative weights for these proposed LTC–DRGs were determined by assigning these cases to proposed low-volume quintile quintile 

3. 4Proposed relative weights for these proposed LTC–DRGs were determined by assigning these cases to proposed low-volume quintile 4. 5Proposed relative weights for these proposed LTC–DRGs were determined by assigning these cases to proposed low-volume quintile quintile 

5. 6Proposed relative weights for these proposed LTC–DRGs were assigned a value of 0.0000. 7Proposed relative weights for these proposed LTC–DRGs were determined by assigning these cases to the appropriate proposed low volume 

quintile because there are no LTCH cases in the FY 2004 MedPAR file. 8Proposed relative weights for these proposed LTC–DRGs were determined after adjusting to account for nonmonotonicity (see step 5 above). 

Appendix A—Regulatory Analysis of 

Impacts 

(If you choose to comment on issues in this 

section, please include the caption ‘‘Impact 

Analyses’’ at the beginning of your 

comment.) 

I. Background and Summary 

We have examined the impacts of this 

proposed rule as required by Executive Order 

12866 (September 1993, Regulatory Planning 

and Review) and the Regulatory Flexibility 

Act (RFA) (September 19, 1980, Pub. L. 96–

354), section 1102(b) of the Social Security 

Act, the Unfunded Mandates Reform Act of 

1995 (Pub. L. 104–4), and Executive Order 

13132. 

Executive Order 12866 directs agencies to 

assess all costs and benefits of available 

regulatory alternatives and, if regulation is 

necessary, to select regulatory approaches 

that maximize net benefits (including 

potential economic, environmental, public 

health and safety effects, distributive 

impacts, and equity). A regulatory impact 

analysis (RIA) must be prepared for major 

rules with economically significant effects 

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

We have determined that this proposed 

rule is a major rule as defined in 5 U.S.C. 

804(2). We estimate that the total impact of 

these proposed changes for FY 2006 

payments compared to FY 2005 payments to 

be approximately a $2.40 billion increase. 

This amount does not reflect changes in 

hospital admissions or case-mix intensity, 

which would also affect overall payment 

changes. 

The RFA requires agencies to analyze 

options for regulatory relief of small 

23654 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

businesses. For purposes of the RFA, small 

entities include small businesses, nonprofit 

organizations, and government agencies. 

Most hospitals and most other providers and 

suppliers are small entities, either by 

nonprofit status or by having revenues of $5 

million to $25 million in any 1 year. For 

purposes of the RFA, all hospitals and other 

providers and suppliers are considered to be 

small entities. Individuals and States are not 

included in the definition of a small entity. 

In addition, section 1102(b) of the Act 

requires us to prepare a regulatory impact 

analysis for any proposed rule that may have 

a significant impact on the operations of a 

substantial number of small rural hospitals. 

This analysis must conform to the provisions 

of section 603 of the RFA. With the exception 

of hospitals located in certain New England 

counties, for purposes of section 1102(b) of 

the Act, we previously defined 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). 

However, under the new labor market 

definitions, we no longer employ NECMAs to 

define urban areas in New England. 

Therefore, we now define a small rural 

hospital as a hospital with fewer than 100 

beds that is located outside of a Metropolitan 

Statistical Area (MSA). 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 IPPS, we 

continue to classify these hospitals as urban 

hospitals. 

Section 202 of the Unfunded Mandates 

Reform Act of 1995 (Pub. L. 104–4) also 

requires that agencies assess anticipated costs 

and benefits before issuing any proposed rule 

(or a final rule that has been preceded by a 

proposed rule) that may result in an 

expenditure in any one year by State, local, 

or tribal governments, in the aggregate, or by 

the private sector, of $110 million. This 

proposed rule will not mandate any 

requirements for State, local, or tribal 

governments. 

Executive Order 13132 establishes certain 

requirements that an agency must meet when 

it promulgates a proposed rule (and 

subsequent final rule) that imposes 

substantial direct requirement costs on State 

and local governments, preempts State law, 

or otherwise has Federalism implications. 

We have reviewed this proposed rule in light 

of Executive Order 13132 and have 

determined that it would not have any 

negative impact on the rights, roles, and 

responsibilities of State, local, or tribal 

governments. 

In accordance with the provisions of 

Executive Order 12866, this proposed rule 

was reviewed by the Office of Management 

and Budget. 

The following analysis, in conjunction 

with the remainder of this document, 

demonstrates that this proposed rule is 

consistent with the regulatory philosophy 

and principles identified in Executive Order 

12866, the RFA, and section 1102(b) of the 

Act. The proposed rule will affect payments 

to a substantial number of small rural 

hospitals, as well as other classes of 

hospitals, and the effects on some hospitals 

may be significant. 

II. Objectives 

The primary objective of the IPPS is to 

create incentives for hospitals to operate 

efficiently and minimize unnecessary costs 

while at the same time ensuring that 

payments are sufficient to adequately 

compensate hospitals for their legitimate 

costs. In addition, we share national goals of 

preserving the Medicare Trust Fund. 

We believe the proposed changes in this 

proposed rule will further each of these goals 

while maintaining the financial viability of 

the hospital industry and ensuring access to 

high quality health care for Medicare 

beneficiaries. We expect that these proposed 

changes will ensure that the outcomes of this 

payment system are reasonable and equitable 

while avoiding or minimizing unintended 

adverse consequences. 

III. Limitations of Our Analysis 

The following quantitative analysis 

presents the projected effects of our proposed 

policy changes, as well as statutory changes 

effective for FY 2006, 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. As we have done in the previous 

proposed rules, we are soliciting comments 

and information about the anticipated effects 

of these proposed changes on hospitals and 

our methodology for estimating them. Any 

comments that we receive in response to this 

proposed rule will be addressed in the final 

rule. 

IV. Hospitals Included In and Excluded 

From the IPPS 

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 35 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 46 such hospitals in 

Maryland remain excluded from the IPPS 

under the waiver at section 1814(b)(3) of the 

Act. 

As of March 2005, there are 3,693 IPPS 

hospitals to be included in our analysis. This 

represents about 63 percent of all Medicareparticipating hospitals. The majority of this 

impact analysis focuses on this set of 

hospitals. There are also approximately 974 

critical access hospitals (CAHs). These small, 

limited service hospitals are paid on the basis 

of reasonable costs rather than under the 

IPPS. There are also 1,138 specialty hospitals 

and units that are excluded from the IPPS. 

These specialty hospitals include psychiatric 

hospitals and units, rehabilitation hospitals 

and units, long-term care hospitals, 

children’s hospitals, and cancer hospitals. 

The impacts of our proposed policy changes 

on these hospitals are discussed below. 

V. Impact on Excluded Hospitals and 

Hospital Units 

As of March 2005, there were 1,138 

specialty hospitals excluded from the IPPS. 

Of these 1,138 specialty hospitals, 467 

psychiatric hospitals, 80 children’s, 11 

cancer hospitals, and 21 LTCHs that are paid 

under the LTCH PPS blend methodology are 

being paid, in whole or in part, on a 

reasonable cost basis subject to the rate-ofincrease ceiling under § 413.40. The 

remaining providers—218 IRFs and 361 

LTCHs are paid 100 percent of the Federal 

prospective rate under the IRF PPS and the 

LTCH PPS, respectively. In addition, there 

were 1,342 psychiatric units (paid on a blend 

of the IPF PPS per diem payment and the 

TEFRA reasonable cost-based payment) and 

1,006 rehabilitation units (paid under the IRF 

PPS) in hospitals otherwise subject to the 

IPPS. Under § 413.40(a)(2)(i)(A), the rate-ofincrease ceiling is not applicable to the 46 

specialty hospitals and units in Maryland 

that are paid in accordance with the waiver 

at section 1814(b)(3) of the Act. 

In the past, hospitals and units excluded 

from the IPPS have been paid based on their 

reasonable costs subject to limits as 

established by the Tax Equity and Fiscal 

Responsibility Act of 1982 (TEFRA). 

Hospitals that continue to be paid based on 

their reasonable costs are subject to TEFRA 

limits for FY 2006. For these hospitals, the 

proposed update is the percentage increase in 

the excluded hospital market basket, 

currently estimated at 3.4 percent. 

Inpatient rehabilitation facilities (IRFs) are 

paid under a prospective payment system 

(IRF PPS) for cost reporting periods 

beginning on or after January 1, 2002. For 

cost reporting periods beginning during FY 

2005, the IRF PPS is based on 100 percent 

of the adjusted Federal IRF prospective 

payment amount, updated annually. 

Therefore, these hospitals are not impacted 

by this proposed rule. 

Effective for cost reporting periods 

beginning on or after October 1, 2002, LTCHs 

are paid under a LTCH PPS, based on a 

Federal prospective payment amount that is 

updated annually. LTCHs will receive a 

blended payment that consists of the Federal 

prospective payment rate and a reasonable 

cost-based payment rate over a 5-year 

transition period. However, under the LTCH 

PPS, a LTCH may also elect to be paid at 100 

percent of the Federal prospective rate at the 

beginning of any of its cost reporting periods 

during the 5-year transition period. For 

purposes of the update factor, the portion of 

the LTCH PPS transition blend payment 

based on reasonable costs for inpatient 

operating services would be determined by 

updating the LTCH’s TEFRA limit by the 

estimate of the excluded hospital market 

basket (or 3.4 percent). 

Section 124 of the Medicare, Medicaid, and 

SCHIP Balanced Budget Refinement Act of 

1999 (BBRA) required the development of a 

per diem prospective payment system (PPS) 

for payment of inpatient hospital services 

furnished in psychiatric hospitals and 

psychiatric units of acute care hospitals and 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23655 

CAHs (inpatient psychiatric facilities (IPFs)). 

We published a final rule to implement the 

IPF PPS on November 15, 2004 (69 FR 

66922). The final rule established a 3-year 

transition to the IPF PPS during which some 

providers will receive a blend of the IPF PPS 

per diem payment and the TEFRA reasonable 

cost-based payment. For purposes of 

determining what the TEFRA payment to the 

IPF would be, we are proposing that the IPF’s 

TEFRA limit will be updated by the estimate 

of the excluded hospital market basket (or 3.4 

percent). 

The impact on excluded hospitals and 

hospital 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 below the rate-of-increase limits since 

their base period, the major effect is on the 

level of incentive payments these hospitals 

and hospital units receive. Conversely, for 

excluded hospitals and hospital units with 

per-case cost increases above the cumulative 

update in their rate-of-increase limits, the 

major effect is the amount of excess costs that 

will not be reimbursed. 

We note that, under § 413.40(d)(3), an 

excluded hospital or unit whose costs exceed 

110 percent of its rate-of-increase limit 

receives its rate-of-increase limit plus 50 

percent of the difference between its 

reasonable costs and 110 percent of the limit, 

not to exceed 110 percent of its limit. In 

addition, under the various provisions set 

forth in § 413.40, certain excluded hospitals 

and hospital units can obtain payment 

adjustments for justifiable increases in 

operating costs that exceed the limit. 

However, at the same time, by generally 

limiting payment increases, we continue to 

provide an incentive for excluded hospitals 

and hospital units to restrain the growth in 

their spending for patient services. 

VI. Quantitative Impact Analysis of the 

Policy Changes Under the IPPS for 

Operating Costs 

A. Basis and Methodology of Estimates 

In this proposed rule, we are announcing 

policy changes and payment rate updates for 

the IPPS for operating costs. Changes to the 

capital payments are discussed in section 

VIII. of this Appendix. Based on the overall 

percentage change in payments per case 

estimated using our payment simulation 

model (a 2.5 percent increase), we estimate 

the total impact of these proposed changes 

for FY 2006 operating payments compared to 

FY 2005 operating payments to be 

approximately a $2.41 billion increase. This 

amount does not reflect changes in hospital 

admissions or case-mix intensity, which 

would also affect overall payment changes. 

We have prepared separate impact analyses 

of the proposed changes to each system. This 

section deals with proposed changes to the 

operating prospective payment system. Our 

payment simulation model relies on the most 

recent available data to enable us to estimate 

the impacts on payments per case of certain 

changes we are proposing in this rule. 

However, there are other changes we are 

proposing for which we do not have data 

available that would allow us to estimate the 

payment impacts using this model. For those 

proposed changes, we have attempted to 

predict the payment impacts of those 

proposed changes based upon our experience 

and other more limited data. 

The data used in developing the 

quantitative analyses of changes in payments 

per case presented below are taken from the 

FY 2004 MedPAR file and the most current 

Provider-Specific File that is used for 

payment purposes. Although the analyses of 

the changes to the operating PPS do not 

incorporate cost data, data from the most 

recently available hospital cost report were 

used to categorize hospitals. Our analysis has 

several qualifications. First, we do not make 

adjustments for behavioral changes that 

hospitals may adopt in response to the 

proposed policy changes, and we do not 

adjust for future changes in such variables as 

admissions, lengths of stay, or case-mix. 

Second, due to the interdependent nature of 

the IPPS payment components, it is very 

difficult to precisely quantify the impact 

associated with each proposed 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. However, for 

individual hospitals, some 

miscategorizations are possible. 

Using cases in the FY 2004 MedPAR file, 

we simulated payments under the operating 

IPPS given various combinations of payment 

parameters. Any short-term, acute care 

hospitals not paid under the IPPS (Indian 

Health Service hospitals and hospitals in 

Maryland) were excluded from the 

simulations. The impact of payments under 

the capital IPPS, or the impact of payments 

for costs other than inpatient operating costs, 

are not analyzed in this section. Estimated 

payment impacts of proposed FY 2006 

changes to the capital IPPS are discussed in 

section VIII of this Appendix. 

The proposed changes discussed separately 

below are the following: 

• 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 the proposed changes in 

hospitals’ wage index values reflecting wage 

data from hospitals’ cost reporting periods 

beginning during FY 2002, compared to the 

FY 2001 wage data. 

• The effect of the proposed change in the 

way we use the wage data for hospitals that 

reclassify as rural under section 401 of the 

BBRA to compute wage indexes. 

• The effect of the proposed wage and 

recalibration budget neutrality factors. 

• The effect of the remaining labor market 

area transition for those hospitals that were 

urban under the old labor market area 

designations and are now considered rural 

hospitals. 

• The effects of geographic 

reclassifications by the MGCRB that will be 

effective in FY 2006. 

• The effects of section 505 of Pub. L. 108–

173, which provides for an increase in a 

hospital’s wage index if the hospital qualifies 

by meeting a threshold percentage of 

residents of the county where the hospital is 

located who commute to work at hospitals in 

counties with higher wage indexes. 

• The total change in payments based on 

proposed FY 2006 policies and MMAimposed changes relative to payments based 

on FY 2005 policies. 

To illustrate the impacts of the proposed 

FY 2006 changes, our analysis begins with a 

FY 2006 baseline simulation model using: 

the proposed update of 3.2 percent; the FY 

2005 DRG GROUPER (version 22.0); the 

CBSA designations for hospitals based on 

OMB’s June 2003 MSA definitions; the FY 

2005 wage index; and no MGCRB 

reclassifications. Outlier payments are set at 

5.1 percent of total operating DRG and outlier 

payments. 

Section 1886(b)(3)(B)(vii) of the Act, as 

added by section 501(b) of Pub. L. 108–173, 

provides that, for FYs 2005 through 2007, the 

update factors will be reduced by 0.4 

percentage points for any hospital that does 

not submit quality data. For purposes of the 

FY 2006 simulations in this proposed impact 

analysis, we are assuming all hospitals will 

qualify for the full update. 

Each proposed and statutory policy change 

is then added incrementally to this baseline 

model, finally arriving at an FY 2006 model 

incorporating all of the proposed changes. 

This allows us to isolate the effects of each 

proposed change. 

Our final comparison illustrates the 

percent change in payments per case from FY 

2005 to FY 2006. Three factors not discussed 

separately have significant impacts here. The 

first is the update to the standardized 

amount. In accordance with section 

1886(b)(3)(B)(i) of the Act, we have updated 

standardized amounts for FY 2006 using the 

most recently forecasted hospital market 

basket increase for FY 2006 of 3.2 percent. 

(Hospitals that fail to comply with the quality 

data submission requirement to receive the 

full update will receive an update reduced by 

0.4 percentage points to 2.8 percent.) Under 

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

updates to the hospital-specific amounts for 

sole community hospitals (SCHs) and for 

Medicare-dependent small rural hospitals 

(MDHs) are also equal to the market basket 

increase, or 3.2 percent. 

A second significant factor that impacts 

changes in hospitals’ payments per case from 

FY 2005 to FY 2006 is the change in MGCRB 

status from one year to the next. That is, 

hospitals reclassified in FY 2005 that are no 

longer reclassified in FY 2006 may have a 

negative payment impact going from FY 2005 

to FY 2006; conversely, hospitals not 

reclassified in FY 2005 that are reclassified 

in FY 2006 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 change 

in payments for the category may be below 

the national mean. However, this effect is 

alleviated by section 1886(d)(10)(D)(v) of the 

Act, which provides that reclassifications for 

purposes of the wage index are for a 3-year 

period. 

A third significant factor is that we 

currently estimate that actual outlier 

23656 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

payments during FY 2005 will be 4.4 percent 

of total DRG payments. When the FY 2005 

final rule was published, we projected FY 

2005 outlier payments would be 5.1 percent 

of total DRG plus outlier payments; the 

average standardized amounts were offset 

correspondingly. The effects of the lower 

than expected outlier payments during FY 

2005 (as discussed in the Addendum to this 

proposed rule) are reflected in the analyses 

below comparing our current estimates of FY 

2005 payments per case to estimated FY 2006 

payments per case (with outlier payments 

projected to equal 5.1 percent of total DRG 

payments). 

B. Analysis of Table I 

Table I displays the results of our analysis 

of proposed changes for FY 2006. 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 impact on the 3,693 

hospitals included in the analysis. This 

number is 204 fewer hospitals than were 

included in the impact analysis in the FY 

2005 final rule (69 FR 49758 ). 

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; and rural. There are 2,537 hospitals 

located in urban areas included in our 

analysis. Among these, there are 1,399 

hospitals located in large urban areas 

(populations over 1 million), and 1,138 

hospitals in other urban areas (populations of 

1 million or fewer). In addition, there are 

1,156 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 2006 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 that 

the number of hospitals paid based on these 

categorizations after consideration of 

geographic reclassifications are 2,575, 1,410, 

1,165, and 1,118, respectively. 

The next three groupings examine the 

impacts of the proposed changes on hospitals 

grouped by whether or not they have GME 

residency programs (teaching hospitals that 

receive an IME adjustment) or receive DSH 

payments, or some combination of these two 

adjustments. There are 2,615 nonteaching 

hospitals in our analysis, 841 teaching 

hospitals with fewer than 100 residents, and 

237 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 for DSH purposes. 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 five rows examine the impacts of 

the proposed changes on rural hospitals by 

special payment groups (SCHs, rural referral 

centers (RRCs), and Medicare dependant 

hospitals (MDHs)), as well as rural hospitals 

not receiving a special payment designation. 

There were 134 RRCs, 405 SCHs, 158 MDHs, 

and 73 hospitals that are both SCH and RRC. 

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 2002 Medicare cost report files, 

if available (otherwise FY 2001 data are 

used). 

The next series of groupings concern the 

geographic reclassification status of 

hospitals. The first grouping displays all 

hospitals that were reclassified by the 

MGCRB for FY 2006. The next two groupings 

separate the hospitals in the first group by 

urban and rural status. The final two rows in 

Table I contain hospitals located in rural 

counties but deemed to be urban under 

section 1886(d)(8)(B) of the Act and hospitals 

located in urban counties, but deemed to be 

rural under section 1886(d)(8)(E) of the Act. 

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C. Impact of the Proposed Changes to the 

Postacute Care Transfer Policy (Column 2) 

In Column 2 of Table I, we present the 

effects of Option 2 for the proposed 

expansion of the postacute care transfer 

policy, as discussed in section V.A. of the 

preamble to this proposed rule. We compared 

aggregate payments using the FY 2005 DRG 

relative weights (GROUPER version 22.0) and 

Option 2 for the proposed expansion of the 

postacute care transfer policy to aggregate 

payments using the FY 2005 DRG relative 

weights (GROUPER version 22.0) and the FY 

2005 postacute care transfer policy. The 

changes we are proposing are estimated to 

result in a 1.1 percent decrease in payments 

to hospitals overall. We estimate the total 

savings at approximately $880 million. 

To simulate the impact of this proposed 

policy, we calculated two sets of transferadjusted discharges and case-mix index 

values for hospitals. The first set was based 

on the FY 2005 transfer policy rules and the 

second was based on Option 2 for the 

proposed expanded transfer policy discussed 

in the preamble to this proposed rule. 

Estimated payments were computed for both 

sets of data and were then compared. The 

transfer-adjusted discharge fraction is 

calculated in one of two ways, depending on 

the transfer payment methodology. Under the 

transfer payment methodology in place in FY 

2005, for all but the three DRGs receiving 

special payment consideration (DRGs 209, 

210, and 211), this adjustment is made by 

adding 1 to the length of stay and dividing 

that amount by the geometric mean length of 

stay for the DRG (with the resulting fraction 

not to exceed 1.0). For example, a transfer 

after 3 days from a DRG with a geometric 

mean length of stay of 6 days would have a 

transfer-adjusted discharge fraction of 0.667 

((3+1)/6). 

For transfers from any one of the three 

DRGs receiving the alternative payment 

methodology, the transfer-adjusted discharge 

fraction is 0.5 (to reflect that these cases 

receive half the full DRG amount the first 

day), plus one half of the result of dividing 

1 plus the length of stay prior to transfer by 

the geometric mean length of stay for the 

DRG. There are 88 DRGs (including 210, 211) 

that would qualify to receive the special 

payment consideration. DRG 209 which 

formerly received the special payment has 

been split into two new DRGs 544 and 545. 

Both DRG 544 and DRG 545 are included in 

the 88 special payment DRGs as they 

continue to qualify to receive the alternative 

payment methodology. As with the above 

adjustment, the result is equal to the lesser 

of the transfer adjusted discharge fraction or 

1. 

The transfer-adjusted case-mix index 

values are calculated by summing the 

transfer-adjusted DRG weights and dividing 

by the transfer-adjusted discharges. The 

transfer-adjusted DRG weights are calculated 

by multiplying the DRG weight by the lesser 

of 1 or the transfer-adjusted discharge 

fraction for the case, divided by the 

geometric mean length of stay for the DRG. 

In this way, simulated payments per case can 

be compared before and after the proposed 

change to the transfer policy. 

This proposed expansion of the policy, 

which represents a significant change from 

our prior policy, has a negative 1.1 percent 

payment impact overall among both urban 

and rural hospitals. There is only small 

variation among all of the hospital categories 

from this negative 1.1 percent impact. The 

areas that are most dramatically impacted are 

urban areas, with urban New England 

experiencing a 1.9 percent decline in 

payments and the Middle Atlantic 

experiencing a 1.2 percent decline. Although 

rural New England hospitals are losing 1.1 

percent, most of the other rural regions lose 

less than 1 percent from this policy change. 

Urban areas tend to have a greater 

concentration of postacute care facilities to 

which to discharge patients than do rural 

areas and are, therefore, more likely to be 

impacted by this policy proposal. 

D. Impact of the Proposed Changes to the 

DRG Reclassifications and Recalibration of 

Relative Weights (Column 3) 

In Column 3 of Table I, we present the 

combined effects of the DRG reclassifications 

and recalibration, as discussed in section II. 

of the preamble to this proposed rule. Section 

1886(d)(4)(C)(i) of the Act requires us 

annually 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 2005 DRG relative weights (GROUPER 

version 22.0) to aggregate payments using the 

proposed FY 2006 DRG relative weights 

(GROUPER version 23.0). We note that, 

consistent with section 1886(d)(4)(C)(iii) of 

the Act, we have applied a budget neutrality 

factor to ensure that the overall payment 

impact of the DRG changes (combined with 

the wage index changes) is budget neutral. 

This proposed budget neutrality factor of 

1.002494 is applied to payments in Column 

6. Because this is a combined DRG 

reclassification and recalibration and wage 

index budget neutrality factor, it is not 

applied to payments in Column 3. 

The major DRG classification changes we 

are proposing include: reassigning procedure 

code 35.52 (Repair of atrial septal defect with 

prosthesis, closed technique) from DRG 108 

to DRG 518 (Percutaneous Cardiovascular 

Procedure Without Coronary Artery Stent or 

AMI); reassigning procedure code 37.26 

(Cardiac electrophysiologic stimulation and 

recording studies) from DRGs 535 and 536 to 

DRGs 515 (Cardiac Defibrillator Implant 

Without Cardiac Catheterization); splitting 

DRG 209 into two new DRGs based on the 

presence or absence of the procedure codes 

for major joint replacement or reattachment 

of lower extremity and revision of hip or 

knee replacement, DRG 545 (Revision of Hip 

or Knee Replacement) and DRG 544 (Major 

Joint Replacement or Reattachment of Lower 

Extremity); reassigning procedure code 26.12 

(Open biopsy of salivary gland or duct) from 

DRG 468 to DRG 477 (Non-Extensive O.R. 

Procedure Unrelated To Principal Diagnosis); 

reassigning the principal diagnosis codes for 

curvature of the spine or malignancy from 

DRGs 497 and 498 to new DRG 546 (Spinal 

Fusion Except Cervical with PDX of 

Curvature of the Spine or Malignancy); 

splitting DRGs 516 and 526 into four new 

DRGs based on the presence or absence of a 

CC, DRG 547 (Percutaneous Cardiovascular 

Procedure With AMI With CC), DRG 548 

(Percutaneous Cardiovascular Procedure 

With AMI Without CC), DRG 549 

(Percutaneous Cardiovascular Procedure 

With Drug-Eluting Stent With AMI With CC), 

DRG 550 (Percutaneous Cardiovascular 

Procedure With Drug-Eluting Stent With AMI 

Without CC); reassigning procedure code 

39.65 (Extracorporeal membrane oxygenation 

[ECMO]) from DRGs 104 and 105 to DRG 541 

(ECMO or Tracheostomy with Mechanical 

Ventilation 96+ Hours or Principal Diagnosis 

Except Face, Mouth and Neck Diagnoses 

With Major Operating Room Procedure). 

In the aggregate, these proposed changes 

would result in a 0.1 percent increase in 

overall payments to hospitals. On average, 

the impacts of these changes on any 

particular hospital group are very small, with 

urban hospitals experiencing a 0.2 percent 

increase and rural hospitals experiencing a 

0.1 percent decrease. The largest impact is a 

0.4 percent increase among urban hospitals 

in New England. This is in part due to the 

residual effects of the proposed change to the 

postacute care transfer policy on the relative 

weights. Including a DRG in the postacute 

care transfer group reduces the number of 

cases in the DRG (cases that qualify as 

transfers are only counted as a fraction of a 

case) which in turn increases the average 

charge for the DRG and the weight. 

E. Impact of Proposed Wage Index Changes 

(Column 4) 

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 proposed wage index for FY 

2006 is based on data submitted for hospital 

cost reporting periods beginning on or after 

October 1, 2001 and before October 1, 2002. 

The impact of the new data on hospital 

payments is isolated in Column 4 by holding 

the other payment parameters constant in 

this simulation. That is, Column 4 shows the 

percentage changes in payments when going 

from a model using the FY 2005 wage index, 

based on FY 2001 wage data, to a model 

using the FY 2006 pre-reclassification wage 

index, based on FY 2002 wage data. The FY 

2005 wage index baseline incorporated a 

blended wage index of 50 percent of the MSA 

wage index and 50 percent of the CBSA wage 

index in areas where the CBSA wage index 

was lower than the MSA wage index to 

reflect the transition policy that was in effect 

in FY 2005. The wage data collected on the 

FY 2002 cost report is the same as the FY 

2001 wage data that were used to calculate 

the FY 2005 wage index. 

Column 4 shows the impacts of updating 

the wage data using FY 2002 cost reports. 

Overall, the new wage data will lead to a 0.4 

percent decrease for all hospitals and for 

hospitals in urban areas. This decrease is due 

to both fluctuations in the wage data itself 

and the fact that the transition blended wage 

index, which benefited areas that were 

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transition is no longer in effect for FY 2006. 

Among regions, the largest increase is in the 

rural New England which is experiencing a 

1.0 percent increase. The largest decline from 

updating the wage data is seen in the urban 

New England region (a 1.1 percent decrease). 

In looking at the wage data itself, the 

national average hourly wage increased 6.1 

percent compared to FY 2005. Therefore, the 

only manner in which to maintain or exceed 

the previous year’s wage index was to match 

the national 6.1 increase in average hourly 

wage. Of the 3,617 hospitals with wage index 

values in both FYs 2005 and 2006, 1,642, or 

45.4 percent, also experienced an average 

hourly wage increase of 6.1 percent or more. 

The following chart compares the shifts in 

wage index values for hospitals for FY 2006 

relative to FY 2005. Among urban hospitals, 

58 will experience an increase of between 5 

percent and 10 percent and 24 will 

experience an increase of more than 10 

percent. A total of 14 rural hospitals would 

experience increases greater than 5 percent, 

but none will experience increases of greater 

than 10 percent. On the negative side, 56 

urban hospitals will experience decreases in 

their wage index values of at least 5 percent, 

but less than 10 percent. Fourteen urban 

hospitals will experience decreases in their 

wage index values greater than 10 percent. 

The following chart shows the projected 

impact for urban and rural hospitals. 

F. Impact of Proposed Change in Treatment 

of Section 1886(d)(8)(E) Wage Data (Column 

5) 

For the FY 2006 wage index, we are 

proposing to leave the wage data for a 

hospital redesignated as rural under section 

1886(d)(8)(E) of the Act in the urban area in 

which the hospital is geographically located 

for purposes of calculating the wage index of 

those areas. We are proposing to move the 

wage data for these hospitals into the rural 

wage index only if it increases the wage 

index in the rural area. In this way, the rural 

floor is only affected by the wage data for 

these redesignated hospitals if it would 

increase the rural wage index and thus reset 

the rural floor at a higher value. Previously, 

the wage data for these redesignated 

hospitals was moved into the rural area wage 

index calculations regardless of whether it 

increased or decreased the rural wage index, 

and this caused the rural floor for several 

States to be lower than it would have been 

had the redesignated providers’ data not been 

included. 

Column 5 shows the impact of adopting 

this policy. In aggregate, this policy proposal 

has no effect on payments to providers. 

Hospitals in the urban New England region 

experience an increase in payments of 0.2 

percent, which indicates that CBSAs in that 

region that receive the rural floor are now 

receiving a higher wage index. Hospitals in 

West North Central are shown to experience 

a 0.2 decline. However, when the 

redesignated data are added to the rural wage 

index, their rural floor increases and they do 

not actually experience a loss from this 

policy. Hospitals reclassified as rural under 

section 1886(d)(8)(E) of the Act will 

experience a 0.2 percent increase. 

G. Combined Impact of Proposed DRG and 

Wage Index Changes, Including Budget 

Neutrality Adjustment (Column 6) 

The impact of the 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. As noted in the 

Addendum to this proposed rule compared 

simulated aggregate payments using the FY 

2005 DRG relative weights and wage index to 

simulated aggregate payments using the 

proposed FY 2006 DRG relative weights and 

blended wage index. 

We computed a proposed wage and 

recalibration budget neutrality factor of 

1.002494. The 0.0 percent impact for all 

hospitals demonstrates that these changes, in 

combination with the budget neutrality 

factor, are budget neutral. 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 6. The changes in this 

column are the sum of the proposed changes 

in Columns 3, 4, and 5, combined with the 

budget neutrality factor and the wage index 

floor for urban areas required by section 4410 

of Pub. L. 105–33 to be budget neutral. There 

also may be some variation of plus or minus 

0.1 percentage point due to rounding. 

Among urban regions, the largest impacts 

are in the West North Central region and 

Puerto Rico, with 0.3 and 0.4 percent 

declines, respectively. The Pacific region 

experiences the largest increase of 1.1 

percent. Among rural regions, the New 

England region benefits the most with a 1.3 

percent increase, while the Mountain region 

experiences the largest decline (1.2 percent). 

H. Impact of Allowing Urban Hospitals That 

Were Converted to Rural as a Result of the 

CBSA Designations To Maintain the Wage 

Index of the MSA Where They Are Located 

(Column 7) 

To help alleviate the decreased payments 

for urban hospitals that became rural under 

the new labor market area definitions, for 

purposes of the wage index, we adopted a 

policy in FY 2005 to allow them to maintain 

the wage index assignment of the MSA where 

they were located for the 3-year period FY 

2005, FY 2006, and FY 2007. Column 7 

shows the impact of the remaining labor 

market area transition, for those hospitals 

that were urban under the old labor market 

area designations and are now considered 

rural hospitals. Section 1886(d)(3)(E) of the 

Act specifies that any updates or adjustments 

to the wage index are to be budget neutral. 

Therefore, we applied an adjustment of 

0.999529 to ensure that the effects of 

reclassification are budget neutral as 

indicated by the zero effect on payments to 

hospitals overall. The rural hospital row 

shows a 0.3 percent benefit from this 

provision as these hold harmless hospitals 

are now considered geographically rural. 

I. Impact of MGCRB Reclassifications 

(Column 8) 

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 8 reflect the per case payment 

impact of moving from this baseline to a 

simulation incorporating the MGCRB 

decisions for FY 2006. These decisions affect 

hospitals’ standardized amount and wage 

index area assignments. 


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By February 28 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 another area’s wage 

index value. The proposed FY 2006 wage 

index values incorporate all of the MGCRB’s 

reclassification decisions for FY 2006. The 

wage index values also reflect any decisions 

made by the CMS Administrator through the 

appeals and review process through February 

28, 2005. Additional changes that result from 

the Administrator’s review of MGCRB 

decisions or a request by a hospital to 

withdraw its application will be reflected in 

the final rule for FY 2006. 

The overall effect of geographic 

reclassification is required by section 

1886(d)(8)(D) of the Act to be budget neutral. 

Therefore, we applied an adjustment of 

0.992905 to ensure that the effects of 

reclassification are budget neutral. (See 

section II.A.4.b. of the Addendum to this 

proposed rule.) 

As a group, rural hospitals benefit from 

geographic reclassification. We estimate that 

their payments will rise 2.0 percent in 

Column 8. Payments to urban hospitals will 

decline by 0.3 percent. Hospitals in other 

urban areas will experience an overall 

decrease in payments of 0.2 percent, while 

large urban hospitals will lose 0.4 percent. 

Among urban hospital groups (that is, bed 

size, census division, and special payment 

status), payments generally would decline. 

A positive impact is evident among all of 

the rural hospital groups. The smallest 

increase among the rural census divisions is 

0.5 for the Mountain and New England 

regions. The largest increases are in the rural 

East South Central region, with an increase 

of 3.0 percent and in the West South Central 

region, which would experience an increase 

of 2.5 percent. 

Urban hospitals reclassified for FY 2006 

are expected to receive an increase of 2.3 

percent, while rural reclassified hospitals are 

expected to benefit from the MGCRB changes 

with a 3.7 percent increase in payments. 

Payments to urban and rural hospitals that 

did not reclassify are expected to decrease 

slightly due to the MGCRB changes, 

decreasing by 0.6 percent for urban hospitals 

and 0.3 percent for rural hospitals. 

J. Impacts of the Proposed Wage Index 

Adjustment for Out-Migration (Column 9) 

Section 1886(d)(13) of the Act, as added by 

section 505 of Pub. L. 108–173, provides for 

an increase in the wage index for hospitals 

located in certain counties that have a 

relatively high percentage of hospital 

employees who reside in the county, but 

work in a different area with a higher wage 

index. Hospitals located in counties that 

qualify for the payment adjustment are to 

receive an increase in the wage index that is 

equal to a weighted average of the difference 

between the wage index of the resident 

county and the higher wage index work 

area(s), weighted by the overall percentage of 

workers who are employed in an area with 

a higher wage index. Using our established 

criteria, 345 counties and 688 hospitals 

qualify to receive a commuting adjustment in 

FY 2006. 

Due to the statutory formula to calculate 

the adjustment and the small number of 

counties that qualify, the impact on hospitals 

is minimal, with an overall impact on all 

hospitals of 0.1 percent. 

K. All Changes (Column 10) 

Column 10 compares our estimate of 

payments per case, incorporating all changes 

reflected in this proposed rule for FY 2006 

(including statutory changes), to our estimate 

of payments per case in FY 2005. This 

column includes all of the proposed policy 

changes. Because the reclassifications shown 

in Column 8 do not reflect FY 2005 

reclassifications, the impacts of FY 2006 

reclassifications only affect the impacts from 

FY 2005 to FY 2006 if the reclassification 

impacts for any group of hospitals are 

different in FY 2006 compared to FY 2005. 

• Column 10 reflects all FY 2006 changes 

relative to FY 2005, shown in Columns 2 

through 9 and those not applied until the 

final rates are calculated. The average 

increase for all hospitals is approximately 2.5 

percent. This increase includes the effects of 

the proposed 3.2 percent market basket 

update. It also reflects the 0.7 percentage 

point difference between the projected 

outlier payments in FY 2005 (5.1 percent of 

total DRG payments) and the current estimate 

of the percentage of actual outlier payments 

in FY 2005 (4.4 percent), as described in the 

introduction to this Appendix and the 

Addendum to this proposed rule. As a result, 

payments are projected to be 0.7 percentage 

point lower in FY 2005 than originally 

estimated, resulting in a 0.7 percentage point 

greater increase for FY 2006 than would 

otherwise occur. In addition, the impact of 

section 505 adjustments accounted for a 0.1 

percent increase. Payment decreases of 1.5 

percent are primarily attributable to the 

impact of expanding the postacute care 

transfer policy (¥1.1 percent). Indirect 

medical education formula changes for 

teaching hospitals under section 502 of Pub. 

L. 108–173, changes in payments due to the 

difference between the FY 2005 and FY 2006 

wage index values assigned to providers 

reclassified under section 508 of Pub. L. 108–

173, and changes in the incremental increase 

in payments from section 505 of Pub. L. 108–

173 out migration adjustments account for 

the remaining ¥0.4 percent. 

Section 213 of Pub. L. 106–554 provides 

that all SCHs may receive payment on the 

basis of their costs per case during their cost 

reporting period that began during 1996. For 

FY 2006, eligible SCHs receive 100 percent 

of their 1996 hospital-specific rate. In 

addition, in this proposed rule we are 

proposing to revise the budget neutrality 

adjustment applied to the hospital-specific 

rates to reflect only the payment changes 

resulting from DRG recalibration. Previously, 

we had also adjusted the hospital-specific 

rates to reflect payment changes based on 

area wage levels. The impact of this 

provision is modeled in Column 10 as well. 

In addition, section 402 of Pub. L. 108–173 

increases the DSH adjustment for hospitals 

that serve a disproportionate share of lowincome Medicare and Medicaid patients, 

which include rural hospitals and urban 

hospitals with fewer than 100 beds, SCHs, 

rural referral centers, and rural hospitals with 

less than 500 beds. The increase in DSH 

payments became effective for discharges 

occurring on or after April 1, 2004. As 

provided in the new Medicare law, the cap 

on DSH payment adjustments increased from 

5.25 percent to 12 percent for urban hospitals 

with fewer than 100 beds, SCHs, and rural 

hospitals with less than 500 beds. There is 

no cap on rural referral centers, large urban 

hospitals over 100 beds, or rural hospitals 

over 500 beds. 

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 10 may not equal the sum of the 

changes described above. 

The overall change in payments per case 

for hospitals in FY 2006 would increase by 

2.5 percent. Hospitals in urban areas would 

experience a 2.5 percent increase in 

payments per case compared to FY 2005. 

Hospitals in rural areas, meanwhile, would 

experience a 2.6 percent payment increase. 

Hospitals in large urban areas would 

experience a 2.4 percent increase in 

payments and hospitals in other urban areas 

would experience a 2.7 percent increase in 

payments. 

Among urban census divisions, the largest 

payment increase would be 4.0 percent in the 

Pacific region. Hospitals in the urban East 

South Central and West South Central 

regions would experience the next largest 

overall increases of 3.0 percent and 3.1 

percent, respectively. The smallest urban 

increase would occur in the New England 

region, with an increase of 1.0 percent. 

Among rural regions in Column 10, no 

hospital category will experience overall 

payment decreases. The Pacific and Middle 

Atlantic regions will benefit the most, with 

3.3 and 3.2 percent increases, respectively. 

The smallest increase will occur in the West 

South Central region, with 2.2 percent 

increases in payments. 

Among special categories of rural hospitals 

in Column 10, those hospitals receiving 

payment under the hospital-specific 

methodology (SCHs, MDHs, and SCH/RRCs) 

would experience payment increases of 2.8 

percent, 2.4 percent, and 2.7 percent, 

respectively. This outcome is primarily 

related to the fact that, for hospitals receiving 

payments under the hospital-specific 

methodology, there were several increases to 

payments made in relation to 

implementation of the Pub. L. 108–173. 

Urban hospitals reclassified for FY 2006 

are anticipated to receive an increase of 3.0 

percent, while rural reclassified hospitals are 

expected to benefit from reclassification with 

a 2.8 percent increase in payments. Those 

hospitals located in rural counties, but 

deemed to be urban under section 

1886(d)(8)(B) of the Act, are expected to 

receive an increase in payments of 1.4 

percent. 

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Table II presents the projected impact of 

the proposed changes for FY 2006 for urban 

and rural hospitals and for the different 

categories of hospitals shown in Table I. It 

compares the estimated payments per case 

for FY 2005 with the average estimated per 

case payments for FY 2006, 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 10 of Table I. 

VII. Impact of Other Proposed Policy 

Changes 

In addition to those proposed changes 

discussed above that we are able to model 

using our IPPS payment simulation model, 

we are proposing various other changes in 

this proposed rule. Generally, we have 

limited or no specific data available with 

which to estimate the impacts of these 

changes. Our estimates of the likely impacts 

associated with these other proposed changes 

are discussed below. 

A. Impact of Proposed LTC-DRG 

Reclassifications and Relative Weights for 

LTCHs 

In section II.D. of the preamble of this 

proposed rule, we discuss the proposed 

changes in the LTC-DRG relative weights for 

FY 2006 based on the proposed version 23.0 

of the CMS GROUPER (including the 


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proposed changes in the classifications, 

relative weights and geometric mean length 

of stay for each LTC-DRG). Based on LTCH 

cases in the FY 2004 MedPAR file, we 

estimate that the proposed changes would 

result in an aggregate decrease in LTCH 

payments of approximately 4.7 percent. 

When we compared the version 22 (FY 2005) 

LTC-DRG relative weights to the proposed 

version 23 (FY 2006) LTC-DRG relative 

weights, we found that approximately 72 

percent of the LTC-DRGs had higher relative 

weights under version 22 in comparison to 

the proposed version 23. We also found that 

the version 22 LTC-DRG relative weights 

were, on average, approximately 16 percent 

higher than the proposed version 23 LTCDRG relative weights. 

In addition, based on an analysis of the 

most recent available LTCH claims data from 

the FY 2004 MedPAR file, we continue to 

observe that the proposed average LTC-DRG 

relative weight decreases due to an increase 

of relatively lower charge cases being 

assigned to LTC-DRGs with higher relative 

weights in the prior year. Contributing to this 

increase in these relatively lower charge 

cases being assigned to LTC-DRGs with 

higher relative weights in the prior year are 

improvements in coding practices, which are 

typically found when moving from a 

reasonable cost-based payment system to a 

PPS. The impact of including cases with 

relatively lower charges into LTC-DRGs that 

had a relatively higher relative weight in the 

version 22.0 (FY 2005) GROUPER is a 

decrease in the average relative weight for 

those LTC-DRGs in the proposed GROUPER 

version 23.0. We also found that there is over 

a 15 percent increase in the average LTCH 

charge across all LTC-DRGs from FY 2003 to 

FY 2004. For some LTC-DRGs in which the 

average charge within the LTC-DRG increase 

is less than 15 percent, the relative weights 

for those LTC-DRGs will decrease because 

the average charge for each of those LTCDRGs is being divided by a larger number 

(that is, the average charge across all LTCDRGs). For the reasons discussed above, we 

believe that the proposed changes in the 

LTC-DRG relative weights, which include a 

number of proposed LTC-DRGs with lower 

proposed relative weights, would result in 

approximately a 4.6 percent decrease in 

aggregate LTCH PPS payments. 

B. Impact of Proposed New Technology AddOn Payments 

We are no longer required to ensure that 

any add-on payments for new technology 

under section 1886(d)(5)(K) of the Act are 

budget neutral (see section II.E. of the 

preamble to this proposed rule). However, we 

are still providing an estimate of the payment 

increases here, as they will have a significant 

impact on total payments made in FY 2006. 

New technology add-on payments are limited 

to the lesser of 50 percent of the costs of the 

technology, or 50 percent of the costs in 

excess of the DRG payment for the case. 

Because it is difficult to predict the actual 

new technology add-on payment for each 

case, we are estimating the increase in 

payment for FY 2006 as if every claim with 

these add-on payments will receive the 

maximum add-on payment. As discussed in 

section II.E. of the preamble of this proposed 

rule, we are not proposing to approve any of 

the new technology applications that were 

filed for FY 2006. However, we are proposing 

to continue to make add-on payments in FY 

2006 for an FY 2005 new technology: 

KinetraTM implants. We estimate this 

approval would increase overall payments by 

$12.8 million. The increase in payments for 

this new technology is not reflected in the 

tables. 

C. Impact of Requirements for Hospital 

Reporting of Quality Data for Annual 

Hospital Payment Update 

In section V.B. of the preamble to this 

proposed rule, we discuss our 

implementation of section 1886(b)(3)(B)(vii) 

of the Act, as added by section 501(b) of Pub. 

L. 108–173, which revised the mechanism 

used to update the standardized amount of 

payment for inpatient hospital operating 

costs. Specifically, section 1886(b)(3)(B)(vii) 

of the Act provides for a reduction of 0.4 

percentage points to the update percentage 

increase (also known as the market basket 

update) for each of FYs 2005 through 2007 

for any subsection (d) hospital that does not 

submit data on a set of 10 quality indicators 

established by the Secretary as of November 

1, 2003. The statute also provides that any 

reduction will apply only to the year 

involved, and will not be taken into account 

in computing the applicable percentage 

increase for a subsequent fiscal year. We are 

unable to precisely estimate the effect of this 

provision because, while receiving the full 

update for those years is conditional upon 

the submission of quality data by a hospital, 

the submitted data must also be validated, as 

described in section V.B. above. The final 

date for submission of quality data for 

purposes of receiving the full adjustment in 

FY 2006 is May 15, 2005. Preliminary results 

indicate that over 98 percent of IPPS 

hospitals have submitted quality data. The 

QIOs are still in the process of validating that 

data and certifying those hospitals eligible to 

receive the full update for FY 2006. We have 

continued our efforts to ensure that QIOs 

provide assistance to all hospitals that wish 

to submit data. In the preamble to this 

proposed rule, we are proposing additional 

validation criteria to ensure that the quality 

data being sent to CMS are accurate. Our 

validation process requires participating 

hospitals to submit five charts per quarter. 

We reimburse each hospital for the cost of 

sending charts to the Clinical Data 

Abstraction Center at the rate of 12 cents per 

page for copying and approximately $4.00 

per chart for postage. Based on our 

experience, the average size of a chart is 140 

pages. Therefore, we estimate our 

expenditures for chart collection at $380,000 

per quarter. Because we provide 

reimbursement to hospitals for the costs of 

chart submission, we believe that this 

requirement represents a minimal burden to 

participating hospitals. Based on test 

applications of these validation criteria to 

quality data that have been submitted thus 

far, we currently estimate that approximately 

5 percent of hospitals will fail the edits and 

receive the reduced market basket update to 

the standardized amount. Based on this 

reduced payment to some hospitals, we 

estimate savings to the Medicare program of 

approximately $20 million for FY 2006. 

D. Impact of Proposed Policy on Payment 

Adjustments for Low-Volume Hospitals 

In section V.E. of the preamble to this 

proposed rule, we discussed our proposed 

FY 2006 implementation of section 

1886(d)(12) of the Act, as added by section 

406 of Pub. L. 108–173, which provides for 

a payment adjustment to account for the 

higher costs per discharge of low-volume 

hospitals under the IPPS. For FY 2006, we 

are proposing to continue to apply the lowvolume adjustment criteria that we specified 

in the FY 2005 IPPS final rule (69 FR 49099). 

Currently, our fiscal intermediaries have 

identified 10 providers that are eligible for 

the low-volume adjustment. We estimate that 

the impact of these providers receiving the 

additional 25 percent payment increase to be 

approximately $1.5 million. 

E. Impact of Proposed Policies on Payment 

for Indirect Costs of Graduate Medical 

Education 

1. IME Adjustment for TEFRA Hospitals 

Converting to IPPS Hospitals 

In section V.F.2. of the preamble of this 

proposed rule, we discuss our proposal to 

incorporate into regulations our existing 

policy regarding the IME adjustment for 

TEFRA hospitals converting to IPPS 

hospitals. We establish an FTE resident cap 

for TEFRA hospitals converting to an IPPS 

hospital for IME payment purposes as if the 

hospital had been an IPPS hospital during 

the base year used to compute the hospital’s 

direct GME FTE resident cap. We are only 

aware of four hospitals where this issue has 

arisen. The proposed addition to the 

regulations clarifies the established policy for 

computing an IME FTE resident cap for these 

hospitals. Because this is a proposal to clarify 

existing policy and codify it in regulations, 

there is no financial impact for FY 2006. 

2. Section 1886(d)(8)(E) Teaching Hospitals 

That Withdraw Rural Reclasssification 

In section V.F.3. of the preamble to this 

proposed rule, we present our proposal to 

adjust the IME FTE resident caps of hospitals 

that rescind their section 1886(d)(8)(E) rural 

reclassifications so that they do not continue 

to receive the increase in the FTE resident 

cap that is applied for rural teaching hositals. 

The purpose of this policy is to prevent 

urban hospitals from reclassifying to rural 

areas under section 1886(d)(8)(E) of the Act 

for a short period of time, solely as a means 

of receiving a permanent increase to their 

IME FTE caps. The impact of this policy is 

that section 1886(d)(8)(E) hospitals may 

receive decreased IME payments if they 

return to urban status. This impact cannot be 

quantified because we are unable to 

determine the number of hospitals that 

would otherwise game the system in the 

absence of this proposal and we are not 

aware of any teaching hospitals that became 

rural under the provision of section 

1886(d)(8)(E) of the Act that have 

subsequently reverted to urban status. 

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F. Impact of Proposed Policy Relating to 

Geographic Reclassifications of Multicampus 

Hospitals 

In section V.H. of the preamble of this 

proposed rule, we discuss the impact of our 

implementation of the new labor market 

areas on multicampus hospital systems. 

Under our current policy, a multicampus 

hospital with campuses located in the same 

labor market area receives a single wage 

index. However, if the campuses are located 

in more than one labor market area, payment 

for each discharge is determined using the 

wage index value for the labor market area 

in which the campus of the hospital is 

located. In addition, current provisions 

provide that, in the case of a merger of 

hospitals, if the merged facilities operate as 

a single institution, the institution must 

submit a single cost report, which 

necessitates a single provider identification 

number. This provision also does not 

differentiate between merged facilities in a 

single wage index area or in multiple wage 

index areas. As a result, the wage index data 

for the merged facility is reported for the 

entire entity on a single cost report. 

The current criteria for a hospital being 

reclassified to another wage area by the 

MGCRB do not address the circumstances 

under which a single campus of a 

multicampus hospital may seek 

reclassification. 

Specifically, we are proposing that for 

reclassification applications submitted for FY 

2006 (that is, applications received by 

September 1, 2004), we would allow a 

campus or campuses of a multicampus 

hospital system to seek geographic 

reclassification on the basis of the average 

hourly wage data submitted for the entire 

hospital system. For reclassification 

applications that would take effect for FY 

2007 (that is, applications received by 

September 1, 2005) and thereafter, a campus 

of a multihospital system could not use the 

wage data of the entire hospital system, but 

rather, would have the opportunity to 

separate out campus-specific wage data for 

purposes of seeking reclassification for such 

campus. We estimate that this proposal will 

apply to fewer than 12 multicampus hospital 

systems nationwide and, therefore, will not 

lead to additional program expenditures 

because hospital geographic reclassifications 

are budget neutral under section 

1886(d)(8)(D) of the Act. 

G. Impact of Proposed Policy on Payment for 

Direct Costs of Graduate Medical Education 

1. GME Initial Residency—Match for Second 

Year 

In section V.I.2. of the preamble to this 

proposed rule, we discuss our proposed 

changes related to the initial residency 

period for residents that match into an 

advanced residency program, but fail to 

match into a clinical base year of training. 

We are proposing that, in instances where a 

hospital can document that, prior to 

commencement of any residency training, a 

resident matched into an advanced program 

that begins in the second residency year, that 

resident’s initial residency period will be 

determined based on the period of board 

eligibility for the advanced program, without 

regard to the fact that the resident had not 

matched for a clinical base year training 

program. For purposes of this proposed rule, 

we have estimated the impact of this 

proposed rule change for FY 2006, using 

assumptions about the national average per 

resident amount, the number of affected 

residents, and the national average Medicare 

utilization rate. We estimate that this 

provision will affect approximately 600 

residents. Using a national average per 

resident amount of $92,000, and an average 

Medicare utilization rate of 35 percent, we 

estimate that, for FY 2006, the impact of 

treating those residents as a full FTE rather 

than .50 FTE, Medicare payments for direct 

GME will increase by approximately $9.7 

million. 

2. New Teaching Hospitals’ Participation in 

Medicare GME Affiliated Groups 

In section V.I.3. of the preamble to this 

proposed rule, we discuss our proposed 

changes related to new teaching hospitals’

participation in Medicare GME affiliated 

groups. Under current regulations, a new 

teaching hospital located in an urban area 

that establishes an FTE resident cap under 

§ 413.79(e) may not participate in a Medicare 

GME affiliated group. We are proposing to 

revise the regulations to allow a new teaching 

hospital located in an urban area to 

participate in a Medicare GME affiliated 

group, but only if any adjustments made by 

the Medicare GME affiliation agreement 

result in an increase to the new teaching 

hospital’s adjusted resident FTE resident 

caps for purposes of IME and direct GME 

payment. There is no estimated increase in 

program payments related to this proposed 

change because any additional residents that 

would be counted at the new teaching 

hospitals as a result of this change could 

have been counted prior to the affiliation for 

Medicare GME payment purposes at the 

hospital that is losing slots under the 

affiliation agreement. 

H. Impact of Policy on Rural Community 

Hospital Demonstration Program 

In section V.K. of the preamble to this 

proposed rule, we discuss our 

implementation of section 410A of Pub.L. 

108–173 that required the Secretary to 

establish a demonstration that will modify 

reimbursement for inpatient services for up 

to 15 small rural hospitals. Section 

410A(c)(2) requires that ‘‘in conducting the 

demonstration program under this section, 

the Secretary shall ensure that the aggregate 

payments made by the Secretary do not 

exceed the amount which the Secretary 

would have paid if the demonstration 

program under this section was not 

implemented.’’ As discussed in section V.K. 

of the preamble to this proposed rule, we are 

satisfying this requirement by adjusting 

national IPPS rates by a factor that is 

sufficient to account for the added costs of 

this demonstration. We estimate that the 

average additional annual payment for FY 

2006 that will be made to each participating 

hospital under the demonstration will be 

approximately $977,410. We based this 

estimate on the recent historical experience 

of the difference between inpatient cost and 

payment for hospitals that have applied for 

the demonstration. For 13 participating 

hospitals, the total annual impact of the 

demonstration program is estimated to be 

$12,706,334. We describe the budget 

neutrality adjustment required for this 

purpose in the Addendum to this proposed 

rule. 

I. Impact of Proposed Policy on CAH 

Relocation Provisions 

In section VII.B.3. of the preamble to this 

proposed rule, we discuss the proposed 

change to the necessary provider provision as 

it applies to CAHs. As required by statute, no 

additional CAHs will be certified as a 

necessary provider on or after January 1, 

2006. We are proposing to revise the 

regulations to allow some flexibility for those 

CAHs previously designated as necessary 

providers that embarked on a replacement 

facility project before the sunset provision 

was enacted on December 8, 2003, but find 

that they cannot be operational in the 

replacement facility by January 1, 2006. We 

are proposing that, when a CAH is 

determined to have relocated, it may 

continue to operate under its existing 

necessary provider designation that exempts 

CAHs from the distance from another 

provider requirement only if certain 

conditions are met. The proposed 

clarification to the sunset of the necessary 

provider provision is intended to allow CAHs 

to complete construction projects that were 

initiated prior to the enactment of Pub. L. 

108–173. The Health Resources Services 

Administration (HRSA) estimates that this 

proposal will apply to fewer than six CAHs 

nationwide. The average cost of construction 

of a new 25 bed CAH is approximately $25 

million. Given a depreciation schedule based 

on a 25 useful life and Medicare utilization 

of approximately 50 percent, the additional 

capital costs for six CAHs would be $3 

million. However, the actual cost to the 

program would be further reduced since 

those 6 CAH are currently being reimbursed 

for their existing capital costs and also the 

increased operating costs that are associated 

with operating an aged facility. Accordingly, 

the budgetary impact for the proposed 

change on the affected CAHs is estimated at 

between $1 million and $2 million. 

Expressed on a per-facility basis, the 

budgetary impact of this proposed change is 

estimated at between $167,000 and $333,000 

per CAH. 

VIII. Impact of Proposed Changes in the 

Capital PPS 

A. General Considerations 

Fiscal year (FY) 2001 was the last year of 

the 10-year transition period established to 

phase in the PPS for hospital capital-related 

costs. During the transition period, hospitals 

were paid under one of two payment 

methodologies: fully prospective or hold 

harmless. Under the fully prospective 

methodology, hospitals were paid a blend of 

the capital Federal rate and their hospitalspecific rate (see § 412.340). Under the holdharmless methodology, unless a hospital 

elected payment based on 100 percent of the 

capital Federal rate, hospitals were paid 85 

percent of reasonable costs for old capital 

costs (100 percent for SCHs) plus an amount 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23669 

for new capital costs based on a proportion 

of the capital Federal rate (see § 412.344). As 

we state in section VI. of the preamble of this 

proposed rule, with the 10-year transition 

period ending with hospital cost reporting 

periods beginning on or after October 1, 2001 

(FY 2002), beginning in FY 2002 capital 

prospective payment system payments for 

most hospitals are based solely on the capital 

Federal rate. Therefore, we no longer include 

information on obligated capital costs or 

projections of old capital costs and new 

capital costs, which were factors needed to 

calculate payments during the transition 

period, for our impact analysis. 

In accordance with § 412.312, the basic 

methodology for determining a capital PPS 

payment is: 

(Standard Federal Rate) × (DRG weight) × 

(Geographic Adjustment Factor (GAF)) × 

(Large Urban Add-on, if applicable) × (COLA 

adjustment for hospitals located in Alaska 

and Hawaii) × (1 +3 Disproportionate Share 

(DSH) Adjustment Factor + Indirect Medical 

Education (IME) Adjustment Factor, if 

applicable). 

In addition, hospitals may also receive 

outlier payments for those cases that qualify 

under the threshold established for each 

fiscal year. 

The data used in developing the impact 

analysis presented below are taken from the 

December 2004 update of the FY 2004 

MedPAR file and the December 2004 update 

of the Provider Specific File that is used for 

payment purposes. Although the analyses of 

the changes to the capital prospective 

payment system do not incorporate cost data, 

we used the December 2004 update of the 

most recently available hospital cost report 

data (FY 2003) to categorize hospitals. Our 

analysis has several qualifications. First, we 

do not make adjustments for behavioral 

changes that hospitals may adopt in response 

to policy changes. Second, due to the 

interdependent nature of the IPPS, 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 (for instance, 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 sources overall. However, for 

individual hospitals, some 

miscategorizations are possible. 

Using cases from the December 2004 

update of the FY 2004 MedPAR file, we 

simulated payments under the capital PPS 

for FY 2005 and FY 2006 for a comparison 

of total payments per case. Any short-term, 

acute care hospitals not paid under the 

general IPPS (Indian Health Service hospitals 

and hospitals in Maryland) are excluded 

from the simulations. 

As we explain in section III.A.4. of the 

Addendum of this proposed rule, payments 

are no longer made under the regular 

exceptions provision under §§ 412.348(b) 

through (e). Therefore, we no longer use the 

actuarial capital cost model (described in 

Appendix B of the August 1, 2001 proposed 

rule (66 FR 40099)). We modeled payments 

for each hospital by multiplying the capital 

Federal rate by the GAF and the hospital’s 

case-mix. We then added estimated payments 

for indirect medical education, 

disproportionate share, large urban add-on, 

and outliers, if applicable. For purposes of 

this impact analysis, the model includes the 

following assumptions: 

• We estimate that the Medicare case-mix 

index would increase by 1.0 percent in both 

FYs 2005 and 2006. 

• We estimate that the Medicare 

discharges will be 13.5 million in FY 2005 

and 13.3 million in FY 2006 for a 1.5 percent 

decrease from FY 2005 to FY 2006. 

• The capital Federal rate was updated 

beginning in FY 1996 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 

proposed FY 2006 update is 0.7 percent (see 

section III.A.1.a. of the Addendum to this 

proposed rule). 

• In addition to the proposed FY 2006 

update factor, the proposed FY 2006 capital 

Federal rate was calculated based on a 

proposed GAF/DRG budget neutrality factor 

of 1.0019, a proposed outlier adjustment 

factor of 0.9497, and a proposed (special) 

exceptions adjustment factor of 0.9997. 

2. Results 

In the past, in this impact section we 

presented the redistributive effects that were 

expected to occur between ‘‘hold-harmless’’

hospitals and ‘‘fully prospective’’ hospitals 

and a cross-sectional summary of hospital 

groupings by the capital PPS transition 

period payment methodology. We are no 

longer including this information because all 

hospitals (except new hospitals under 

§ 412.324(b) and under § 412.304(c)(2)) will 

be paid 100 percent of the capital Federal 

rate in FY 2006. 

We used the actuarial model described 

above to estimate the potential impact of our 

changes for FY 2006 on total capital 

payments per case, using a universe of 3,693 

hospitals. As described above, the individual 

hospital payment parameters are taken from 

the best available data, including the 

December 2004 update of the FY 2004 

MedPAR file, the December 2004 update to 

the Provider-Specific File, and the most 

recent cost report data from the December 

2004 update of HCRIS. In Table III, we 

present a comparison of total payments per 

case for FY 2005 compared to FY 2006 based 

on the proposed FY 2006 payment policies. 

Column 2 shows estimates of payments per 

case under our model for FY 2005. Column 

3 shows estimates of payments per case 

under our model for FY 2006. Column 4 

shows the total percentage change in 

payments from FY 2005 to FY 2006. The 

change represented in Column 4 includes the 

0.7 percent update to the capital Federal rate, 

a 1.0 percent increase in case-mix, changes 

in the adjustments to the capital Federal rate 

(for example, the effect of the new hospital 

wage index on the GAF), and 

reclassifications by the MGCRB, as well as 

changes in special exception payments. 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 increase 1.7 percent in FY 2006. 

In addition to the 0.7 percent increase due to 

the capital market basket update, this 

projected increase in capital payments per 

case is largely attributable to an estimated 

increase in outlier payments in FY 2006. Our 

comparison by geographic location shows 

that urban hospitals are expected to 

experience a 1.8 percent increase in IPPS 

capital payments per case, while rural 

hospitals are only expected to experience a 

1.2 percent increase in capital payments per 

case. This difference is mostly due to a 

projection that urban hospitals would 

experience a larger increase in estimated 

outlier payments from FY 2005 to FY 2006 

compared to rural hospitals. 

All regions are estimated to receive an 

increase in total capital payments per case 

from FY 2005 to FY 2006. Changes by region 

vary from a minimum increase of 0.1 percent 

(Middle Atlantic rural region) to a maximum 

increase of 3.3 percent (Pacific urban region). 

The relatively small increase in projected 

capital payments per discharge for hospitals 

located in the Middle Atlantic rural region is 

largely attributable to the proposed changes 

in the GAF values (that is, the proposed 

GAFs for most of these hospitals for FY 2006 

are lower than the weighted average of the 

GAFs for FY 2005) . The relatively large 

increase in capital payments per discharge 

for hospitals located in the Pacific urban 

region is largely due to the proposed changes 

in the GAF values (that is, the proposed 

GAFs for most of these hospitals for FY 2006 

are higher than the average of the GAFs for 

FY 2005) and a larger than average increase 

in estimated outlier payments for FY 2006. 

Hospitals located in Puerto Rico are 

expected to experience an increase in total 

capital payments per case of 1.0 percent. This 

slightly lower than average increase in 

payment per case for hospitals located in 

Puerto Rico is largely due to the proposed 

changes in the proposed GAF values (that is, 

the proposed GAFs for most of these 

hospitals for FY 2006 are higher than the 

average of the GAFs for FY 2005). 

By type of ownership, government 

hospitals are projected to have the largest rate 

of increase of total payment changes (2.0 

percent). Similarly, payments to voluntary 

and proprietary hospitals are expected to 

increase 1.6 percent and 1.8 percent, 

respectively. As noted above, this slightly 

larger projected increase in capital payments 

per case for government hospitals is mostly 

due to the larger than average increase in 

projected outlier payments for FY 2006 and 

a smaller than average decrease in the 

proposed GAF values. 

Section 1886(d)(10) of the Act established 

the MGCRB. Previously, hospitals could 

apply for reclassification for purposes of the 

standardized amount, wage index, or both. 

Section 401(c) of Pub. L. 108–173 equalized 

the standardized amounts under the 

operating IPPS. Therefore, beginning in FY 

2005, there is no longer reclassification for 

the purposes of the standardized amounts; 

hospitals may apply for reclassification for 

purposes of the wage index in FY 2006. 

Reclassification for wage index purposes also 

23670 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 

affects the GAF because that factor is 

constructed from the hospital wage index. 

To present the effects of the hospitals being 

reclassified for FY 2006 compared to the 

effects of reclassification for FY 2005, we 

show the average payment percentage 

increase for hospitals reclassified in each 

fiscal year and in total. The reclassified 

groups are compared to all other 

nonreclassified hospitals. These categories 

are further identified by urban and rural 

designation. 

Hospitals reclassified for FY 2006 as a 

whole are projected to experience a 2.0 

percent increase in payments. Payments to 

nonreclassified hospitals in FY 2006 are 

expected to increase 1.7 percent. Hospitals 

reclassified during both FY 2005 and FY 

2006 are projected to experience an increase 

in payments of 1.3 percent. Hospitals 

reclassified during FY 2006 only are 

projected to receive an increase in payments 

of 3.2 percent. This relatively large increase 

is primarily due to the proposed changes in 

the GAF values (that is, the proposed GAFs 

for most of these hospitals for FY 2006 are 

higher than the average of the GAFs for FY 

2005). 

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Appendix B: Recommendation of 

Update Factors for Operating Cost 

Rates of Payment for Inpatient Hospital 

Services 

(If you choose to comment on issues in this 

section, please include the caption ‘‘Update 

Factors’’ at the beginning of your comment.) 

I. Background 

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

that the Secretary, taking into consideration 

the recommendations of the Medicare 

Payment Advisory Commission (MedPAC), 

recommend update factors for inpatient 

hospital services 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. Under section 1886(e)(5) of the Act, 

we are required to publish update factors 

recommended by the Secretary in the 

proposed and final rule. Accordingly, this 

Appendix provides the recommendations of 

appropriate update factors for the IPPS 

standardized amount, the hospital-specific 

rates for SCHs and MDHs, and the rate-ofincrease limits and Federal prospective 

payment amounts for hospitals and hospitals 

units excluded from the IPPS. We also 

discuss our update framework and respond 

to MedPAC’s recommendations concerning 

the update factors. 

II. Secretary’s Recommendations 

Section 1886(b)(3)(B)(i)(XIX) of the Act sets 

the FY 2006 percentage increase in the 

operating cost standardized amount equal to 

the rate-of-increase in the hospital market 

basket for IPPS hospitals in all areas subject 

to the hospital submitting quality 

information under rules established by the 

Secretary under section 1886(b)(3)(B)(vii) of 

the Act. For hospitals that do not provide 

these data, the update is equal to the market 


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basket percentage increase less 0.4 

percentage points. Based on the Office of the 

Actuary’s fourth quarter 2004 forecast of the 

FY 2006 market basket increase, we are 

proposing an update to the standardized 

amount of 3.2 percent (that is, the market 

basket rate-of-increase) for hospitals in all 

areas, provided the hospital submits quality 

data in accordance with our rules. 

Section 1886(b)(3)(B)(iv) of the Act sets the 

FY 2006 percentage increase in the hospitalspecific rates applicable to SCHs and MDHs 

equal to the rate set forth in section 

1886(b)(3)(B)(i) of the Act (that is, the same 

update factor as for all other hospitals subject 

to the IPPS, or the rate-of-increase in the 

market basket). Therefore, the proposed 

update to the hospital-specific rate applicable 

to SCHs and MDHs is also 3.2 percent. 

Section 1886(b)(3)(B)(ii) of the Act sets the 

FY 2006 percentage increase in the rate-ofincrease limits for various hospitals and 

hospital units excluded from the IPPS, that 

is, certain psychiatric hospitals and units 

(now referred to as inpatient psychiatric 

facilities (IPFs)), certain LTCHs, cancer 

hospitals, and children’s hospitals, equal to 

the market basket percentage increase. In the 

past, hospitals and hospital units excluded 

from the IPPS have been paid based on their 

reasonable costs subject to TEFRA limits. 

However, some of these categories of 

excluded hospitals and units are currently, or 

soon will be, paid under their own 

prospective payment systems. Currently, 

children’s and cancer hospitals and RNHCIs 

are the remaining three types of hospitals 

still reimbursed fully under reasonable costs. 

Those psychiatric hospitals and units of 

hospitals not yet paid under a PPS are still 

reimbursed fully on a reasonable cost basis 

subject to TEFRA limits. In addition, those 

LTCHs and IPFs paid under a blend 

methodology have the TEFRA portion of that 

payment subject to the TEFRA limits. 

Hospitals and units that receive any 

reasonable cost-based payments will have 

those payments determined subject to the 

TEFRA limits for FY 2006. 

As we discuss in section IV. of the 

preamble and in section IV. of the 

Addendum to this proposed rule, we are 

proposing to use the estimated FY 2006 IPPS 

operating market basket percentage increase 

(3.2 percent) to update the target limits for 

children’s hospitals, cancer hospitals, and 

religious nonmedical institutions. 

As described in greater detail below, under 

their respective PPSs, LTCHs and IPFs are in 

a transition period during which some 

LTCHs and IPFs are paid a blend of 

reasonable cost-based payments (subject to 

the TEFRA limits) and a Federal prospective 

payment amount. Under the respective 

transition period methodologies for the LTCH 

PPS and IPF PPS, which are described below, 

payment is based, in part, on a decreasing 

percentage of the reasonable cost-based 

payment amount. As we discuss in section 

IV. of the preamble of this proposed rule, we 

are proposing to rebase the market basket 

used to determine the reasonable cost-based 

payment amount for LTCHs and IPFs. We are 

proposing that the portion of payments to 

LTCHs and IPFs that are reasonable costbased will be determined using the FY 2002- 

based excluded hospital market basket 

(currently estimated at 3.4 percent). 

Effective for cost reporting periods 

beginning FY 2003, LTCHs are paid under 

the LTCH PPS, which was implemented with 

a 5-year transition period. (Refer to the 

August 30, 2002 final rule (67 FR 55954).) A 

LTCH may elect to be paid on 100 percent 

of the Federal prospective rate at the start of 

any of its cost reporting periods during the 

5-year transition period. For purposes of the 

update factor for inpatient operating services 

for FY 2006, the portion of the LTCH PPS 

transition blend payment that is based on 

reasonable costs would be determined by 

updating the LTCH’s TEFRA limit by the 

current estimate of the FY 2002-based 

excluded hospital market basket (or 3.4 

percent). 

Effective for cost reporting periods 

beginning on or after January 1, 2005, IPFs 

are paid under the IPF PPS under which they 

receive payment based on a Federal per diem 

rate that is based on the sum of the average 

routine operating, ancillary, and capital costs 

for each patient day of psychiatric care in an 

IPF, adjusted for budget neutrality. During a 

transition period between January 1, 2005 

and January 1, 2008, some IPFs are paid 

based on a blend of the reasonable cost-based 

payments, subject to the TEFRA limit, and 

the Federal per diem base rate. For cost 

reporting periods beginning on or after 

January 1, 2008, IPFs will be paid based on 

100 percent of the Federal per diem rate. For 

purposes of the update factor for FY 2006, 

the portion of the IPF PPS transitional blend 

payment based on reasonable costs would be 

determined by updating the IPF’s TEFRA 

limit by the current estimate of the FY 2002- 

based excluded hospital market basket (or 3.4 

percent). 

IRFs are paid under the IRF PPS for cost 

reporting periods beginning on or after 

January 1, 2002. For cost reporting periods 

beginning during FY 2004, and thereafter, the 

Federal prospective payments to IRFs are 

based on 100 percent of the adjusted Federal 

IRF prospective payment amount, updated 

annually. (Refer to the July 30, 2004 final rule 

(69 FR 45721).) 

III. Update Framework 

Consistent with the current law, for FY 

2006, for IPPS hospitals, we are 

recommending an update of 3.2 percent, 

which reflects the CMS Office of the 

Actuary’s most recent (fourth quarter) 2004 

forecast of the FY 2006 market basket 

increase. In previous years, in making a 

recommendation, we included an update 

framework that analyzed hospital 

productivity, scientific and technological 

advances, practice pattern changes, changes 

in case mix, the effects of reclassification on 

recalibration and forecast error correction. 

Although we have used this framework in 

past years, we are no longer including this 

analysis in our recommendation for the 

update. We are not discussing the framework 

because the productivity measure cannot be 

adequately computed for FY 2006 because of 

the anticipated effects on admissions due to 

the expected increases in enrollment in 

Medicare Advantage plans. The increased 

enrollment in Medicare Advantage plans has 

the effect of causing admissions to decline. 

However, we do not have information on 

how hospital employment will be affected for 

our methodology. Thus, in the absence of 

data to predict the effect of a decline in 

hospital admissions on hospital employment, 

we cannot appropriately reflect productivity 

in our framework. As a result, based on the 

discussion above, we believe it is appropriate 

to recommend an update of 3.2 percent, 

based on the Office of the Actuary’s fourth 

quarter 2004 forecast of the FY 2006 market 

basket percentage increase. 

We note that, although we are not using the 

framework for our recommendation to update 

the operating standardized amounts due to 

the reasons above, we continue to use the 

framework to calculate the capital 

standardized amounts as discussed in section 

III.A.1.a. of the Addendum to this proposed 

rule. This is due to the fact that the 

framework for the capital standardized 

amounts is calculated without a productivity 

factor and, therefore, the reasons discussed 

above do not apply to the update framework 

of the capital standardized amounts. 

We also note that section 1886(e)(3) of the 

Act directs the Secretary to report to 

Congress an initial estimate of the 

recommendation of an appropriate payment 

inflation update for inpatient hospital 

services for the upcoming fiscal year. Earlier 

this year, the Secretary reported to Congress 

that the initial estimate of the 

recommendation of an update factor was 3.3 

percent, which was the market basket update 

for the IPPS standardized amount in the 

President’s FY 2006 budget. The difference 

between the Secretary’s initial estimate and 

the update we are recommending in this 

proposed rule (3.2 percent) is due to the 

availability and use of more recent data for 

the market basket than were available at the 

time the Secretary’s initial estimate was 

developed. In addition, the Secretary’s initial 

estimate was based on the FY 1997-based 

hospital market basket, while the proposed 

update in this proposed rule (the current 

update recommendation) is based on the 

proposed FY 2002-based hospital market 

basket. 

Aside from making a recommendation for 

IPPS hospitals, in accordance with section 

1886(e)(4)(A) of the Act, it is necessary to 

make a recommendation of the update factor 

for all other types of hospitals. Consistent 

with current law, for FY 2006, for SCHs and 

MDHs, we are recommending an update of 

3.2 percent, which reflects the CMS Office of 

the Actuary’s most recent (fourth quarter) 

2004 forecast of the FY 2006 market basket 

percentage increase. 

Consistent with our proposal in section IV. 

of the preamble of this proposed rule, for FY 

2006, for cancer hospitals, religious 

nonmedical health care institutions, and 

children’s hospitals, we are recommending 

an update of 3.2 percent to the target limits. 

Consistent with our proposal in the February 

3, 2005 LTCH PPS proposed rule (70 FR 

5735), we are recommending an update factor 

of 3.1 percent for rate year (RY) 2006. For 

LTCHs that currently may be paid during a 

transition period a blend of reasonable costbased payments (subject to the TEFRA limits) 

and Federal prospective payment amounts, 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Proposed Rules 23673 

we are recommending an update factor of 3.4 

percent for the portion of the payment that 

is based on reasonable costs, subject to the 

TEFRA limits, consistent with our proposal 

in section IV. of the preamble of this 

proposed rule. For the Federal portion of this 

same blended payment amount, we are 

recommending an update of 3.1 percent. 

Because the IPF PPS was effective for cost 

reporting periods beginning on or after 

January 1, 2005, and the base rates are 

effective until July 1, 2006, we are 

recommending an update of zero for IPFs (69 

FR 66922). Finally, for the IRF PPS, we have 

not published a proposed rule proposing an 

update for FY 2006. As a result, we are 

recommending an update of 3.1 percent to 

IRF PPS for FY 2006, the same update used 

for FY 2005. 

IV. MedPAC Recommendation for Assessing 

Payment Adequacy and Updating Payments 

in Traditional Medicare 

In the past, MedPAC has suggested specific 

adjustments to its update recommendation 

for each of the factors discussed under 

section III. of this Appendix. In its March 

2005 Report to Congress, MedPAC assessed 

the adequacy of current payments and costs 

and the relationship between payments and 

an appropriate cost base, utilizing an 

established methodology used by the 

Commission in the past several years. 

MedPAC stressed that the issue at hand was 

whether payments were too high or too low, 

and not how they became either too high or 

too low. 

In the first portion of MedPAC’s analysis 

on the assessment of payment adequacy, the 

Commission reviewed the relationship 

between costs and payments. MedPAC’s 

indicator of the relationship between 

payments and costs is the overall Medicare 

margin. The overall Medicare margin is 

calculated as the difference between 

payments and costs divided by payments. 

Based on the latest cost report data available, 

MedPAC estimated an inpatient hospital 

Medicare operating margin for FY 2003 of 1.3 

percent (down from 5.9 percent and 9.8 

percent for FY 2002 and FY 2001, 

respectively). 

MedPAC also projected margins for FY 

2005, making certain assumptions about 

changes in payments and costs. On the 

payment side, MedPAC applied the annual 

payment updates (as specified by law for FYs 

2001 through 2005), and then modeled the 

effects of other policy changes that have 

affected the level of payments. On the cost 

side, MedPAC estimated the increases in cost 

per unit of output over the same time period 

at the rate of inflation as measured by the 

applicable market basket index generated by 

CMS. 

In addition to considering the relationship 

between estimated payments and costs, 

MedPAC also considered the following three 

factors to assess whether current payments 

are adequate: 

• Changes in access to or quality of care; 

• Changes in the volume of services or 

number of providers; and 

• Change in providers’ access to capital. 

MedPAC’s recommendation was to 

increase payments under the IPPS by the 

projected increase in the hospital market 

basket index, less 0.4 percent, for FY 2006. 

MedPAC noted that the indicators of 

payment adequacy present a mixed picture. 

MedPAC was concerned about the trend of 

falling hospital margins, which may result in 

hospitals having a limited financial cushion 

for dealing with pressures that may arise in 

the coming year. On the other hand, MedPAC 

stated that the current cost trend was 

unsustainable and may have been driven by 

a lack of cost containment. Therefore, 

MedPAC concluded that an update of the 

hospital market basket index minus 0.4 

percent is appropriate. 

Response: As described above, we are 

recommending a full market basket update 

for FY 2006 consistent with current law. We 

believe this will appropriately balance 

incentives for hospitals to operate efficiently 

with the need to provide sufficient payments 

to maintain access to quality care for 

Medicare beneficiaries. 

In addition, because the operating and 

capital prospective payment systems remain 

separate, we are proposing to continue to use 

separate updates for operating and capital 

payments. The proposed update to the 

capital payment rate is discussed in section 

III. of the Addendum to this proposed rule. 

[FR Doc. 05–8507 Filed 4–25–05; 4:12 pm] 

BILLING CODE 4120–01–P