```

[Federal Register Volume 89, Number 249 (Monday, December 30, 2024)]
[Notices]
[Pages 106525-106526]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2024-31240]

-----------------------------------------------------------------------

DEPARTMENT OF HEALTH AND HUMAN SERVICES

Health Resources and Services Administration

Children's Hospitals Graduate Medical Education Payment Program: 
Updated Methodology To Determine Full-Time Equivalent Resident Count

AGENCY: Health Resources and Services Administration (HRSA), Department 
of Health and Human Services.

ACTION: Request for public comment.

-----------------------------------------------------------------------

SUMMARY: This notice seeks public comment on updating the Children's 
Hospitals Graduate Medical Education (CHGME) Payment Program's method 
of determining an eligible children's hospital (as defined within the 
Public Health Service Act) weighted allopathic and osteopathic full-
time equivalent (FTE) resident count when a children's hospital's 
weighted allopathic and osteopathic FTE resident count exceeds its 
direct graduate medical education (GME) FTE resident cap in order to be 
consistent with the methodology used by the Centers for Medicare & 
Medicaid Services (CMS) beginning in the fiscal year (FY) 2026 
application cycle.

DATES: Comments on this notice should be received no later than January 
29, 2025.

ADDRESSES: Written comments should be submitted to Robyn Duarte, Public 
Health Analyst, by email [email protected].

FOR FURTHER INFORMATION CONTACT: Robyn Duarte, Public Health Analyst, 
Bureau of Health Workforce, Division of Medicine and Dentistry, HRSA, 
5600 Fishers Lane, Rockville, MD 20857, 301-443-3254.

SUPPLEMENTARY INFORMATION: The CHGME Payment Program is authorized by 
section 340E of the Public Health Service Act. For direct GME payments, 
section 340E(c)(1)(B) requires that the average number of FTE residents 
in the hospital's approved residency programs be determined according 
to section 1886(h)(4) of the Social Security Act. As noticed in the 
March 1, 2001, Federal Register (66 FR 12940), section 1886(h)(4) has 
been implemented by regulations at 42 CFR 413.78 through 413.83 
(formerly 42 CFR 413.86(f)-(i)), which HRSA has used to determine the 
total and weighted numbers of FTE residents. In the CMS FY 2023 
inpatient prospective payment systems (IPPS) and long-term care 
hospital prospective payment system (LTCH PPS) final rule published in 
the Federal Register on August 10, 2022 (87 FR 48780, 49065-49072) 
(referred to as the ``FY 2023 IPPS/LTCH PPS final rule''), CMS modified 
the Medicare direct GME payment methodology and amended section 413.79 
by revising paragraphs (c)(2)(iii) and (d)(3). Through this notice, 
HRSA is seeking comment on its intent to adopt the same direct GME 
payment methodology as CMS when HRSA calculates FTE residents for the 
CHGME Payment Program beginning in the FY 2026 application cycle.

Background

    To the extent feasible, HRSA has historically sought consistency 
with CMS regulations to minimize burden for children's teaching 
hospitals participating in the CHGME Payment Program that must also 
comply with CMS regulations. Consistency reduces the potential 
challenges in reporting FTE resident counts to Medicare and CHGME.
    Currently, the CHGME Payment Program methodology for determining 
the weighted allopathic and osteopathic FTE resident count applies the 
direct GME FTE resident cap when a hospital's weighted allopathic and 
osteopathic FTE resident count is greater than its direct GME FTE 
resident cap. The current CHGME direct GME methodology reduces a 
hospital's weighted direct GME resident count by a proportion equal to 
the ratio of its GME FTE resident cap to its unweighted direct GME 
resident count. The direct GME FTE resident cap is applied to reduce 
the weighting factor of residents who are beyond their initial 
residency

[[Page 106526]]

period to an amount less than 0.5. See 66 FR 12940.

CMS GME Final Regulation Change

    In August 2022, CMS finalized a new methodology for applying the 
direct GME FTE resident cap when a hospital's weighted allopathic and 
osteopathic FTE resident count is greater than its direct GME FTE 
resident cap, in a way that does not reduce the weighting factor of 
residents that are beyond their initial residency period to an amount 
less than 0.5. Under the new method, if a hospital's unweighted 
allopathic and osteopathic FTE resident count exceeds its direct GME 
FTE resident cap, then the weighted allopathic and osteopathic FTE 
resident count is equal to the hospital's direct GME FTE resident cap 
or its actual weighted allopathic and osteopathic FTE resident count, 
whichever is lesser. The direct GME FTE resident cap reflects the 
maximum number of allopathic and osteopathic residents that a hospital 
may count for purposes of direct GME payment in a cost reporting 
period.

Alignment of CHGME and Medicare GME Policy

    For more than two decades, HRSA has followed CMS's approach to 
calculating the FTE resident count. [See March 1, 2001, Federal 
Register  Notice (66 FRN 12940), ``The Department follows Medicare 
rules regarding the use of the initial residency period. The Medicare 
rules reduce counts for all hospitals that train residents beyond their 
initial residency period (i.e., fellows) with regard to the [direct 
medical education] DME and [indirect Medical Education] IME portions of 
the GME reimbursement.''] Therefore, HRSA proposes to adopt CMS's 
modified direct GME payment methodology with respect to determining the 
weighted number of allopathic and osteopathic FTE residents (i.e., 
fellows) for all eligible children's hospitals participating in the 
CHGME Payment Program beginning in FY 2026.
    In this notice, we refer to the FTE adjusted cap (or 2013 CHGME 
Reauthorization cap pursuant to Pub. L. 113-98) reported on Line 4.06, 
5.06, and 6.06 of the HRSA 99-1 Form as the ``direct GME FTE resident 
cap'' to correspond with CMS terminology.
    HRSA proposes to modify its methodology to adopt the CMS 
methodology described in the amended 42 CFR 413.79 in whole. HRSA 
anticipates implementing the updated methodology for determining the 
weighted allopathic and osteopathic FTE resident count starting in the 
FY 2026 application cycle (project period October 1, 2025, through 
September 30, 2026).

Direct GME Methodology in FY 2026--Proposal for Public Comment

    Starting in FY 2026, where a CHGME participating hospital's 
unweighted allopathic and osteopathic FTE resident count exceeds the 
hospital's FTE resident cap, and the weighted allopathic and 
osteopathic FTE resident count also exceeds that FTE resident cap, the 
respective weighted allopathic and osteopathic FTE resident count is 
adjusted to make the total weighted allopathic and osteopathic FTE 
resident count equal the FTE resident cap. If the weighted allopathic 
and osteopathic FTE resident count does not exceed that FTE resident 
cap, then the allowable weighted allopathic and osteopathic FTE 
resident count for direct GME payment is the actual weighted allopathic 
and osteopathic FTE resident count.
    This proposed update to the methodology for determining the 
weighted allopathic and osteopathic FTE resident count for the CHGME 
Program is intended to reconcile weighted FTE resident counts reported 
in Lines 4.13 (both Hospital Data columns), 5.13, and 6.13 of the HRSA 
Form 99-1 with Lines 9 and 22 of the CMS Form 2552-10, Worksheet E-4, 
respectively. Entries in Lines 4.13 (both Hospital Data columns), 5.13, 
and 6.13 report the weighted resident FTE count for allopathic and 
osteopathic programs following application of the direct GME FTE 
resident cap.
    This updated methodology for determining weighted allopathic and 
osteopathic FTE resident count may result in adjustments to the 
weighted FTE resident 3-year rolling average used to determine direct 
medical education (DME) payment amounts for the eligible children's 
hospitals participating in the CHGME Payment Program.
    The DME payment amounts for CHGME are impacted by many factors 
including the number of residents the hospital trained during the year, 
the hospital's wage index, as well as the overall appropriation. The 
updated methodology for determining the weighted FTE resident count 
will impact awardees that add more residents and fellows above their 
hospital's direct GME FTE resident cap. The updated methodology may 
also impact the DME payments for awardees overall as a hospital may 
receive a different relative share of the CHGME appropriation due to 
these shifts in the weighted FTE resident counts experienced by some 
hospitals.
    The CHGME Payment Program proposes to implement this updated 
methodology beginning in FY 2026 to reduce burden on hospitals 
participating in CHGME and Medicare GME and to reduce the risk of 
potential audit discrepancies that may impact payments.

Diana Espinosa,
Principal Deputy Administrator.
[FR Doc. 2024-31240 Filed 12-27-24; 8:45 am]
BILLING CODE 4165-15-P
```