Medicare Program; Inpatient Rehabilitation Facility Prospective Payment System for Federal Fiscal Year 2009, 46370-46414 [E8-17797]
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46370
Federal Register / Vol. 73, No. 154 / Friday, August 8, 2008 / Rules and Regulations
DEPARTMENT OF HEALTH AND
HUMAN SERVICES
Centers for Medicare & Medicaid
Services
42 CFR Part 412
[CMS–1554–F]
RIN 0938–AP19
Medicare Program; Inpatient
Rehabilitation Facility Prospective
Payment System for Federal Fiscal
Year 2009
Centers for Medicare &
Medicaid Services (CMS), HHS.
ACTION: Final rule.
AGENCY:
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SUMMARY: This final rule updates the
prospective payment rates for inpatient
rehabilitation facilities (IRFs) for
Federal fiscal year (FY) 2009 (for
discharges occurring on or after October
1, 2008 and on or before September 30,
2009) as required under section
1886(j)(3)(C) of the Social Security Act
(the Act). Section 1886(j)(5) of the Act
requires the Secretary to publish in the
Federal Register on or before the August
1 that precedes the start of each fiscal
year, the classification and weighting
factors for the IRF prospective payment
system’s (PPS) case-mix groups and a
description of the methodology and data
used in computing the prospective
payment rates for that fiscal year.
We are revising existing policies
regarding the PPS within the authority
granted under section 1886(j) of the Act.
DATES: These regulations are effective
October 1, 2008. The updated IRF
prospective payment rates are
applicable for discharges on or after
October 1, 2008 and on or before
September 30, 2009 (FY 2009).
FOR FURTHER INFORMATION CONTACT:
Susanne Seagrave, (410) 786–0044, for
information regarding the payment
policies.
Jeanette Kranacs, (410) 786–9385, for
information regarding the wage index.
SUPPLEMENTARY INFORMATION:
Table of Contents
I. Background
A. Historical Overview of the Inpatient
Rehabilitation Facility Prospective
Payment System (IRF PPS)
B. Operational Overview of the Current IRF
PPS
II. Provisions of the Proposed Rule
III. Analysis of and Responses to Public
Comments
IV. Update to the Case-Mix Group (CMG)
Relative Weights and Average Length of
Stay Values for FY 2009
V. FY 2009 IRF PPS Federal Prospective
Payment Rates
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A. Increase Factor and Labor-Related Share
for FY 2009
B. Area Wage Adjustment
C. Description of the IRF Standard
Payment Conversion Factor and Payment
Rates for FY 2009
D. Example of the Methodology for
Adjusting the Federal Prospective
Payment Rates
VI. Update to Payments for High-Cost
Outliers Under the IRF PPS
A. Update to the Outlier Threshold
Amount for FY 2009
B. Update to the IRF Cost-to-Charge Ratio
Ceilings
VII. Revisions to the Regulation Text in
Response to the Medicare, Medicaid, and
SCHIP Extension Act of 2007
VIII. Post Acute Care Payment Reform
IX. Miscellaneous Comments
X. Provisions of the Final Rule
XI. Collection of Information Requirements
XII. Regulatory Impact Statement
Regulation Text
Addendum
MMA Medicare Prescription Drug,
Improvement, and Modernization Act of
2003, Public Law 108–173
MMSEA Medicare, Medicaid, and SCHIP
Extension Act of 2007, Public Law 110–173
MSA Metropolitan Statistical Area
NAICS North American Industrial
Classification System
OMB Office of Management and Budget
PAI Patient Assessment Instrument
PPS Prospective Payment System
RAND RAND Corporation
RFA Regulatory Flexibility Act, Public Law
96–354
RIA Regulatory Impact Analysis
RIC Rehabilitation Impairment Category
RPL Rehabilitation, Psychiatric, and LongTerm Care Hospital Market Basket
SCHIP State Children’s Health Insurance
Program
SIC Standard Industrial Code
TEFRA Tax Equity and Fiscal
Responsibility Act of 1982, Public Law 97–
248
Acronyms
A. Historical Overview of the Inpatient
Rehabilitation Facility Prospective
Payment System (IRF PPS)
Section 4421 of the Balanced Budget
Act of 1997 (BBA), Public Law 105–33,
as amended by section 125 of the
Medicare, Medicaid, and SCHIP (State
Children’s Health Insurance Program)
Balanced Budget Refinement Act of
1999 (BBRA), Public Law 106–113, and
by section 305 of the Medicare,
Medicaid, and SCHIP Benefits
Improvement and Protection Act of
2000 (BIPA), Public Law 106–554,
provides for the implementation of a per
discharge prospective payment system
(PPS) under section 1886(j) of the Social
Security Act (the Act) for inpatient
rehabilitation hospitals and inpatient
rehabilitation units of a hospital
(hereinafter referred to as IRFs).
Payments under the IRF PPS
encompass inpatient operating and
capital costs of furnishing covered
rehabilitation services (that is, routine,
ancillary, and capital costs) but not
direct graduate medical education costs,
costs of approved nursing and allied
health education activities, bad debts,
and other services or items outside the
scope of the IRF PPS. Although a
complete discussion of the IRF PPS
provisions appears in the original FY
2002 IRF PPS final rule (66 FR 41316)
and the FY 2006 IRF PPS final rule (70
FR 47880), we are providing below a
general description of the IRF PPS for
fiscal years (FYs) 2002 through 2008.
Under the IRF PPS from FY 2002
through FY 2005, as described in the FY
2002 IRF PPS final rule (66 FR 41316),
the Federal prospective payment rates
were computed across 100 distinct casemix groups (CMGs). We constructed 95
CMGs using rehabilitation impairment
Because of the many terms to which
we refer by acronym in this final rule,
we are listing the acronyms used and
their corresponding terms in
alphabetical order below.
ASCA Administrative Simplification
Compliance Act, Public Law 107–105
BBA Balanced Budget Act of 1997, Public
Law 105–33
BBRA Medicare, Medicaid, and SCHIP
[State Children’s Health Insurance
Program] Balanced Budget Refinement Act
of 1999, Public Law 106–113
BIPA Medicare, Medicaid, and SCHIP [State
Children’s Health Insurance Program]
Benefits Improvement and Protection Act
of 2000, Public Law 106–554
CBSA Core-Based Statistical Area
CCR Cost-to-Charge Ratio
CFR Code of Federal Regulations
CMG Case-Mix Group
DRA Deficit Reduction Act of 2005, Public
Law 109–171
DSH Disproportionate Share Hospital
ECI Employment Cost Index
FI Fiscal Intermediary
FR Federal Register
FY Federal Fiscal Year
GDP Gross Domestic Product
HHH Hubert H. Humphrey Building
HIPAA Health Insurance Portability and
Accountability Act, Public Law 104–191
IFMC Iowa Foundation for Medical Care
IPF Inpatient Psychiatric Facility
IPPS Inpatient Prospective Payment System
IRF Inpatient Rehabilitation Facility
IRF–PAI Inpatient Rehabilitation FacilityPatient Assessment Instrument
IRF PPS Inpatient Rehabilitation Facility
Prospective Payment System
IRVEN Inpatient Rehabilitation Validation
and Entry
LIP Low-Income Percentage
LTCH Long-Term Care Hospital
MAC Medicare Administrative Contractor
MEDPAR Medicare Provider Analysis and
Review
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I. Background
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categories (RICs), functional status (both
motor and cognitive), and age (in some
cases, cognitive status and age may not
be a factor in defining a CMG). In
addition, we constructed five special
CMGs to account for very short stays
and for patients who expire in the IRF.
For each of the CMGs, we developed
relative weighting factors to account for
a patient’s clinical characteristics and
expected resource needs. Thus, the
weighting factors accounted for the
relative difference in resource use across
all CMGs. Within each CMG, we created
tiers based on the estimated effects that
certain comorbidities would have on
resource use.
We established the Federal PPS rates
using a standardized payment
conversion factor (formerly referred to
as the budget neutral conversion factor).
For a detailed discussion of the budget
neutral conversion factor, please refer to
our FY 2004 IRF PPS final rule (68 FR
45684 through 45685). In the FY 2006
IRF PPS final rule (70 FR 47880), we
discussed in detail the methodology for
determining the standard payment
conversion factor.
We applied the relative weighting
factors to the standard payment
conversion factor to compute the
unadjusted Federal prospective
payment rates under the IRF PPS from
FYs 2002 through 2005. Within the
structure of the payment system, we
then made adjustments to account for
interrupted stays, transfers, short stays,
and deaths. Finally, we applied the
applicable adjustments to account for
geographic variations in wages (wage
index), the percentage of low-income
patients, location in a rural area (if
applicable), and outlier payments (if
applicable) to the IRF’s unadjusted
Federal prospective payment rates.
For cost reporting periods that began
on or after January 1, 2002 and before
October 1, 2002, we determined the
final prospective payment amounts
using the transition methodology
prescribed in section 1886(j)(1) of the
Act. Under this provision, IRFs
transitioning into the PPS were paid a
blend of the Federal IRF PPS rate and
the payment that the IRF would have
received had the IRF PPS not been
implemented. This provision also
allowed IRFs to elect to bypass this
blended payment and immediately be
paid 100 percent of the Federal IRF PPS
rate. The transition methodology
expired as of cost reporting periods
beginning on or after October 1, 2002
(FY 2003), and payments for all IRFs
now consist of 100 percent of the
Federal IRF PPS rate.
We established a CMS Web site as a
primary information resource for the
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IRF PPS. The Web site URL is https://
www.cms.hhs.gov/
InpatientRehabFacPPS/ and may be
accessed to download or view
publications, software, data
specifications, educational materials,
and other information pertinent to the
IRF PPS.
Section 1886(j) of the Act confers
broad statutory authority upon the
Secretary to propose refinements to the
IRF PPS. In the FY 2006 IRF PPS final
rule (70 FR 47880) and in correcting
amendments to the FY 2006 IRF PPS
final rule (70 FR 57166) that we
published on September 30, 2005, we
finalized a number of refinements to the
IRF PPS case-mix classification system
(the CMGs and the corresponding
relative weights) and the case-level and
facility-level adjustments. These
refinements included the adoption of
OMB’s Core-Based Statistical Area
(CBSA) market definitions,
modifications to the CMGs, tier
comorbidities, and CMG relative
weights, implementation of a new
teaching status adjustment for IRFs,
revision and rebasing of the IRF market
basket, and updates to the rural, lowincome percentage (LIP), and high-cost
outlier adjustments. Any reference to
the FY 2006 IRF PPS final rule in this
final rule also includes the provisions
effective in the correcting amendments.
For a detailed discussion of the final key
policy changes for FY 2006, please refer
to the FY 2006 IRF PPS final rule (70 FR
47880 and 70 FR 57166).
In the FY 2007 IRF PPS final rule (71
FR 48354), we further refined the IRF
PPS case-mix classification system (the
CMG relative weights) and the caselevel adjustments, to ensure that IRF
PPS payments continue to reflect as
accurately as possible the costs of care.
For a detailed discussion of the FY 2007
policy revisions, please refer to the FY
2007 IRF PPS final rule (71 FR 48354).
In the FY 2008 IRF PPS final rule (72
FR 44284), we updated the Federal
prospective payment rates and the
outlier threshold, revised the IRF wage
index policy, and clarified how we
determine high-cost outlier payments
for transfer cases. For more information
on the policy changes implemented for
FY 2008, please refer to the FY 2008 IRF
PPS final rule (72 FR 44284), in which
we published the final FY 2008 IRF
Federal prospective payment rates.
After publication of the FY 2008 IRF
PPS final rule (72 FR 44284), section
115 of the Medicare, Medicaid, and
SCHIP Extension Act of 2007, Public
Law 110–173 (MMSEA), amended
section 1886(j)(3)(C) of the Act to apply
a zero percent increase factor for FYs
2008 and 2009, effective for IRF
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discharges occurring on or after April 1,
2008. Section 1886(j)(3)(C) of the Act
requires the Secretary to develop an
increase factor to update the IRF Federal
prospective payment rates for each FY.
Based on the legislative change to the
increase factor, we revised the FY 2008
Federal prospective payment rates for
IRF discharges occurring on or after
April 1, 2008. Thus, the final FY 2008
IRF Federal prospective payment rates
that were published in the FY 2008 IRF
PPS final rule (72 FR 44284) were
effective for discharges occurring on or
after October 1, 2007 and on or before
March 31, 2008; and the revised FY
2008 IRF Federal prospective payment
rates are effective for discharges
occurring on or after April 1, 2008 and
on or before September 30, 2008. The
revised FY 2008 Federal prospective
payment rates are available on the CMS
Web site at https://www.cms.hhs.gov/
InpatientRehabFacPPS/
07_DataFiles.asp#TopOfPage.
B. Operational Overview of the Current
IRF PPS
As described in the FY 2002 IRF PPS
final rule, upon the admission and
discharge of a Medicare Part A fee-forservice patient, the IRF is required to
complete the appropriate sections of a
patient assessment instrument, the
Inpatient Rehabilitation Facility-Patient
Assessment Instrument (IRF–PAI). All
required data must be electronically
encoded into the IRF–PAI software
product. Generally, the software product
includes patient classification
programming called the GROUPER
software. The GROUPER software uses
specific IRF-PAI data elements to
classify (or group) patients into distinct
CMGs and account for the existence of
any relevant comorbidities.
The GROUPER software produces a
five-digit CMG number. The first digit is
an alpha-character that indicates the
comorbidity tier. The last four digits
represent the distinct CMG number.
Free downloads of the Inpatient
Rehabilitation Validation and Entry
(IRVEN) software product, including the
GROUPER software, are available on the
CMS Web site at https://
www.cms.hhs.gov/
InpatientRehabFacPPS/
06_Software.asp.
Once a patient is discharged, the IRF
submits a Medicare claim as a Health
Insurance Portability and
Accountability Act (HIPAA), Public Law
104–191, compliant electronic claim or,
if the Administrative Compliance Act
(ASCA), Public Law 107–105, permits, a
paper claim, a UB–04 or a CMS–1450,
(as appropriate) using the five-digit
CMG number and sends it to the
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appropriate Medicare fiscal
intermediary (FI) or Medicare
Administrative Contractor (MAC).
Claims submitted to Medicare must
comply with both ASCA and HIPAA.
Section 3 of the ASCA amends section
1862(a) of the Act by adding paragraph
(22) which requires the Medicare
program, subject to section 1862(h) of
the Act, to deny payment under Part A
or Part B for any expenses for items or
services ‘‘for which a claim is submitted
other than in an electronic form
specified by the Secretary.’’ Section
1862(h) of the Act, in turn, provides that
the Secretary shall waive such denial in
situations in which there is no method
available for the submission of claims in
an electronic form or the entity
submitting the claim is a small provider.
In addition, the Secretary also has the
authority to waive such denial ‘‘in such
unusual cases as the Secretary finds
appropriate.’’ We refer the reader to the
final rule, ‘‘Medicare Program;
Electronic Submission of Medicare
Claims’’ (70 FR 71008, November 25,
2005). Section 3 of the ASCA operates
in the context of the administrative
simplification provisions of HIPAA,
which include, among others, the
requirements for transaction standards
and code sets codified in 45 CFR, parts
160 and 162, subparts A and I through
R (generally known as the Transactions
Rule). The Transactions Rule requires
covered entities, including covered
healthcare providers, to conduct
covered electronic transactions
according to the applicable transaction
standards. (See the program claim
memoranda issued and published by
CMS at: https://www.cms.hhs.gov/
ElectronicBillingEDITrans/ and listed in
the addenda to the Medicare
Intermediary Manual, Part 3, section
3600. CMS instructions for the limited
number of Medicare claims submitted
on paper are available at: https://
www.cms.hhs.gov/manuals/downloads/
clm104c25.pdf.)
The Medicare FI or MAC processes
the claim through its software system.
This software system includes pricing
programming called the ‘‘PRICER’’
software. The PRICER software uses the
CMG number, along with other specific
claim data elements and providerspecific data, to adjust the IRF’s
prospective payment for interrupted
stays, transfers, short stays, and deaths,
and then applies the applicable
adjustments to account for the IRF’s
wage index, percentage of low-income
patients, rural location, and outlier
payments. For discharges occurring on
or after October 1, 2005, the IRF PPS
payment also reflects the new teaching
status adjustment that became effective
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as of FY 2006, as discussed in the FY
2006 IRF PPS final rule (70 FR 47880).
II. Provisions of the Proposed Rule
As discussed in the FY 2009 IRF PPS
proposed rule (73 FR 22674), we
proposed to make revisions to the
regulation text in response to section
115 of the MMSEA. Specifically, we
proposed to revise 42 CFR part 412. We
discuss these proposed revisions and
others in detail below.
A. Section 412.23 Excluded Hospitals:
Classifications
We proposed to revise the regulation
text in paragraph (b)(2)(i) and remove
paragraph (b)(2)(ii) in response to
section 115 of the MMSEA. To
summarize, for cost reporting periods—
(1) Beginning on or after July 1, 2005,
the hospital has served an inpatient
population of whom at least 60 percent
require intensive rehabilitation services
for treatment of one or more of the
conditions specified at paragraph
(b)(2)(ii) of this section (as amended by
removing former (b)(2)(ii) and
redesignating former (b)(2)(iii) as the
new (b)(2)(ii)).
(2) A comorbidity that meets the
criteria as specified in § 412.23(b)(2)(i)
may continue to be used to determine
the compliance threshold.
B. Additional Proposed Changes
• Update the FY 2009 IRF PPS
relative weights and average length of
stay values using the most current and
complete Medicare claims and cost
report data, as discussed in section II of
the FY 2009 IRF PPS proposed rule (73
FR 22674, 22676 through 22680).
• Update the FY 2009 IRF PPS
payment rates by the proposed wage
index and labor related share in a
budget neutral manner, as discussed in
sections III.A and B of the FY 2009 IRF
PPS proposed rule (73 FR 22674, 22680
through 22686).
• Update the outlier threshold
amount for FY 2009, as discussed in
section IV.A of the FY 2009 IRF PPS
proposed rule (73 FR 22674, 22686
through 22687).
• Update the cost-to-charge ratio
ceiling and the national average urban
and rural cost-to-charge ratios for
purposes of determining outlier
payments under the IRF PPS, as
discussed in section IV.B of the FY 2009
IRF PPS proposed rule (73 FR 22674 at
22687).
III. Analysis of and Responses to Public
Comments
We received approximately 17 timely
items of correspondence containing
multiple comments on the FY 2009 IRF
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PPS proposed rule (73 FR 22674) from
the public. We received comments from
various trade associations, inpatient
rehabilitation facilities, health care
industry organizations, and health care
consulting firms. The following
discussion, arranged by subject area,
includes a summary of the public
comments that we received, and our
responses to the comments appear
under the appropriate subject heading.
IV. Update to the CMG Relative
Weights and Average Length of Stay
Values for FY 2009
As specified in 42 CFR 412.620(b)(1),
we calculate a relative weight for each
CMG that is proportional to the
resources needed by an average
inpatient rehabilitation case in that
CMG. For example, cases in a CMG with
a relative weight of 2, on average, will
cost twice as much as cases in a CMG
with a relative weight of 1. Relative
weights account for the variance in cost
per discharge due to the variance in
resource utilization among the payment
groups, and their use helps to ensure
that IRF PPS payments support
beneficiary access to care as well as
provider efficiency.
In the FY 2009 IRF PPS proposed rule
(73 FR 22674, 22676 through 22680), we
proposed updates to the CMG relative
weights and average length of stay
values using the most recent available
data (FY 2006 IRF claims, FY 2006 IRFPAI, and FY 2006 IRF cost report data)
to ensure that IRF PPS payments
continue to reflect as accurately as
possible the costs of care in IRFs. We
proposed to do this using the same
methodology, with one change, that was
described in the original, FY 2002 IRF
PPS final rule (66 FR 41316) and the FY
2006 IRF PPS final rule (70 FR 47880,
47887 through 47888). The proposed
change to the methodology involves
using new, more detailed cost-to-charge
ratio (CCR) data from the cost reports of
IRF subprovider units of primary acute
care hospitals, instead of CCR data from
the associated primary acute care
hospitals, to calculate IRFs’ average
costs per case. In general, we proposed
to make this change in the methodology
because the more detailed CCR data
from the IRF subprovider cost reports
are now available in sufficient detail,
and the relationship between costs and
charge in the primary acute care
hospital could differ from the
relationship between costs and charges
in the IRF subprovider units, making the
data from the IRF subprovider units
potentially more accurate for estimating
the average costs per case in these units.
For freestanding IRFs, we proposed to
continue using CCR data from the
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freestanding IRF’s cost report. We also
noted that in future years we would
continue to estimate the CMG relative
weights using both the primary acute
care hospital CCRs and the IRF
subprovider unit CCRs to ensure that we
continue to use the most appropriate
data in updating the CMG relative
weights.
In addition, we proposed to make
changes to the CMG relative weights for
FY 2009 in such a way that total
estimated aggregate payments to IRFs
for FY 2009 would be the same with or
without the proposed changes (that is,
in a budget neutral manner) by applying
a budget neutrality factor to the
standard payment amount, as described
in section II of the FY 2009 IRF PPS
proposed rule (73 FR 22674 at 22677).
To compute the budget neutrality factor
used to update the CMG relative
weights, we proposed to use the
following steps:
Step 1. Calculate the estimated total
amount of IRF PPS payments for FY
2009 (with no proposed changes to the
CMG relative weights).
Step 2. Apply the proposed changes
to the CMG relative weights (as
discussed above) to calculate the
estimated total amount of IRF PPS
payments for FY 2009.
Step 3. Divide the amount calculated
in step 1 by the amount calculated in
step 2 to determine the budget
neutrality factor that would maintain
the same total estimated aggregate
payments in FY 2009 with and without
the proposed changes to the CMG
relative weights.
Step 4. Apply the proposed budget
neutrality factor to the FY 2008 IRF PPS
standard payment amount after the
application of the budget-neutral wage
adjustment factor.
Note that the budget neutrality factor
that we use to update the CMG relative
weights for FY 2009 changed from
0.9969 in the proposed rule to 0.9939 in
this final rule due to the use of updated
FY 2007 IRF claims data in this final
rule.
We received five comments on the
proposed updates to the CMG relative
weights and average length of stay
values, which are summarized below.
Comment: Several commenters
supported the proposed update to the
CMG relative weights for FY 2009, with
one commenter referring to the
proposed update as a ‘‘step in the right
direction.’’ However, several
commenters specifically suggested that
we analyze the FY 2007 IRF claims and
cost report data in computing the CMG
relative weights for FY 2009, as these
data would reflect more of the impact of
recent changes in the 75 percent rule
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and the IRF medical necessity reviews
than the FY 2006 IRF claims and cost
report data. Further, one commenter
recommended that we seek additional
cost information to use to compute the
CMG relative weights, including nursing
staff time data, ancillary cost data, and
other alternatives to the IRF claims and
cost report data that we currently use to
compute the CMG relative weights.
Finally, a couple of commenters
recommended that we recalibrate the
CMG relative weights more frequently,
with one commenter specifically asking
that we recalibrate the CMG relative
weights again next year (for FY 2010)
using the most recent available data.
Response: We agree with the
commenters that we should analyze the
most recent available IRF data to
compute the CMG relative weights for
FY 2009 in order to ensure that IRF PPS
payments continue to reflect as
accurately as possible the costs of care
in IRFs. For the proposed rule, we used
data from FY 2006 IRF claims, FY 2006
IRF-PAI, and FY 2006 IRF cost reports
because that was the best available data
at the time. For this final rule, we have
updated the IRF claims data used in our
analysis of the CMG relative weights
and average length of stay values from
FY 2006 to FY 2007.
We note that we used FY 2006 IRFPAI data for analyzing the CMG relative
weights in the proposed rule because we
implemented some minor adjustments
to the classification system for FY 2007
in the FY 2007 IRF PPS final rule (71
FR 48354, 48360 through 48370).
Accordingly, some of the CMGs that
appeared on the FY 2006 IRF claims
data would not be the same CMGs that
would be assigned under the current,
post-FY 2007 IRF classification system.
We therefore used the FY 2006 IRF–PAI
data for the proposed rule to ensure that
the appropriate current CMG was
assigned for all of the FY 2006 claims.
However, use of the IRF–PAI data was
no longer necessary when we used the
FY 2007 IRF claims data for this final
rule because the CMG information on
the FY 2007 IRF claims data
incorporated all of the changes to the
IRF classification system that were
implemented in the FY 2007 IRF PPS
final rule (71 FR 48354, 48360 through
48370). We did not implement any
changes to the IRF classification system
in the FY 2008 IRF PPS final rule (72
FR 44284). The results of our analysis of
the FY 2007 IRF claims data are
reflected in the CMG relative weights
and average length of stay values
presented in Table 1 in this final rule.
We further note that we have not
updated the IRF cost report data used in
this final rule. Although we agree with
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46373
the commenter that it is important to
analyze the most recent available cost
report data to reflect as fully as possible
the changes in IRF patient populations
that may have occurred as a result of
changes in the 75 percent rule and the
IRF medical necessity reviews, only a
small portion of the FY 2007 IRF cost
reports are available for analysis at this
time. Accordingly, we have continued
to use the FY 2006 cost report data for
analyzing IRFs’ costs per case in this
final rule because these are the most
complete IRF cost report data available
at this time. However, we will continue
to evaluate the need for further updates
and refinements to the CMG relative
weights and average length of stay
values in future years and would update
the cost report data, as appropriate,
when the data become available.
We appreciate the commenter’s
suggestions regarding alternative data to
use in analyzing the costs of caring for
IRF patients, and we will carefully
consider the commenter’s suggestions
for future refinements to the
methodology for computing the CMG
relative weights.
Finally, we agree with the
commenters that we may need to update
the CMG relative weight and average
length of stay analysis frequently to
ensure that IRF payments continue to
reflect the costs of caring for IRF
patients, especially in light of recent
changes resulting from changes to the 75
percent rule and the IRF medical
necessity reviews. We intend to
continue analyzing the most recent
available data, and will propose future
refinements to the IRF classification and
weighting system based on that analysis,
as appropriate.
Comment: One commenter stated a
concern that the methodology used to
revise the IRF classification system in
the FY 2006 IRF PPS final rule (70 FR
47880) may have reduced the overall
IRF case mix weights. This commenter
asked CMS to re-examine this issue.
Response: As discussed in the FY
2006 IRF PPS final rule (70 FR 47880,
47886 through 47904), the FY 2007 IRF
PPS final rule (71 FR 48354, 48373
through 48374), and the FY 2008 IRF
PPS final rule (72 FR 44284 at 44293),
we have analyzed the data and it
continues to show that the FY 2006
refinements to the IRF classification
system did not cause a reduction in the
overall IRF case mix weights or in
aggregate IRF payments. We have met
with industry representatives several
times in order to understand their
concerns. We have also discussed the
results of our analysis with them, which
continues to show that we implemented
the FY 2006 refinements to the IRF
E:\FR\FM\08AUR2.SGM
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46374
Federal Register / Vol. 73, No. 154 / Friday, August 8, 2008 / Rules and Regulations
classification system in a budget neutral
manner, so that estimated aggregate
payments to providers would not
increase or decrease as a result of these
refinements.
Comment: One commenter questioned
why only 141 (40 percent) of the
proposed FY 2009 CMG relative weight
values increased compared with the FY
2008 CMG relative weight values, while
212 (60 percent) of the proposed FY
2009 CMG relative weight values
decreased compared with the FY 2008
CMG relative weight values. This
commenter generally expressed surprise
at the proposed FY 2009 CMG relative
weights values, but indicated that
certain changes appeared to be correct,
particularly the increases in the CMG
relative weights for some of the
orthopedic conditions. However, the
commenter questioned why the CMG
relative weight values for other types of
cases decreased.
Response: As we discussed in the
proposed rule (73 FR 22674 at 22680),
updates to the CMG relative weights
will result in some increases and some
decreases to the CMG relative weight
values. This is due to the distributional
nature of CMG relative weight changes.
However, our updated analysis of the
CMG relative weight values presented in
Table 1 of this final rule (which is based
on more recent data than that used in
the proposed rule, as explained
previously in this section) now shows
that more than half of the CMG relative
weights will increase and, further, that
more than half of beneficiaries are in
payment groups for which the CMG
relative weight will increase between
FY 2008 and FY 2009. Specifically, our
analysis shows that 57 percent of
patients are classified into one of the
177 payment groups (that is, the
combination of CMG and tier) that will
experience an increase in the CMG
relative weight value between FYs 2008
and 2009, and 43 percent of patients are
classified into one of the 176
classification groups that will
experience a decrease in the CMG
relative weight value between FYs 2008
and 2009.
Final Decision: We received only
positive comments in support of the
proposal to change the methodology for
determining IRFs’ average costs per case
by using more detailed cost-to-charge
ratio (CCR) data from the cost reports of
IRF subprovider units of primary acute
care hospitals to calculate the IRF
subprovider units’ average costs per
case. Thus, after carefully considering
all of the comments that we received on
the proposed updates to the CMG
relative weights and average length of
stay values, we are finalizing this
change to the methodology for the
reasons explained previously and as
described in more detail in the proposed
rule (73 FR 22674, 22676 through
22677). For freestanding IRFs, we will
continue to use the CCR data from the
freestanding IRFs’ cost reports.
Consistent with the methodology that
we used to compute the CMG relative
weights for FYs 2002 through 2008,
with the one change described above,
we are implementing the updates to the
CMG relative weights and average
length of stay values presented in Table
1 below. As recommended by the
commenters, we have updated the CMG
relative weights and average length of
stay values in Table 1 using FY 2007
IRF claims data for this final rule.
Further, as noted previously, we have
continued to use FY 2006 IRF cost
report data for this final rule because it
is the best available cost report data at
this time.
TABLE 1—RELATIVE WEIGHTS AND AVERAGE LENGTHS OF STAY FOR CASE-MIX GROUPS
CMG
0101 ...............
0102 ...............
0103 ...............
0104 ...............
0105 ...............
0106 ...............
0107 ...............
0108 ...............
0109 ...............
0110 ...............
0201 ...............
0202 ...............
0203 ...............
pwalker on PROD1PC71 with RULES2
0204 ...............
0205 ...............
0206 ...............
0207 ...............
VerDate Aug<31>2005
CMG
description
(M=motor,
C=cognitive,
A=age)
Relative weight
Tier 1
Stroke: M>51.05 ...................
Stroke: M>44.45 and
M<51.05 and C>18.5.
Stroke: M>44.45 and
M<51.05 and C<18.5.
Stroke: M>38.85 and
M<44.45.
Stroke: M>34.25 and
M<38.85.
Stroke: M>30.05 and
M<34.25.
Stroke: M>26.15 and
M<30.05.
Stroke: M<26.15 and A>84.5
Stroke: M>22.35 and
M<26.15 and A<84.5.
Stroke: M<22.35 and A<84.5
Traumatic brain injury:
M>53.35 and C>23.5.
Traumatic brain injury:
M>44.25 and M<53.35
and C>23.5.
Traumatic brain injury:
M>44.25 and C<23.5.
Traumatic brain injury:
M>40.65 and M<44.25.
Traumatic brain injury:
M>28.75 and M<40.65.
Traumatic brain injury:
M>22.05 and M<28.75.
Traumatic brain injury:
M<22.05.
17:29 Aug 07, 2008
Jkt 214001
Tier 2
Tier 3
Average length of stay
None
Tier 1
Tier 2
Tier 3
None
0.7712
0.9694
0.7108
0.8936
0.6381
0.8021
0.6059
0.7617
9
11
10
11
9
11
8
10
1.1478
1.0580
0.9496
0.9018
14
14
12
12
1.2192
1.1238
1.0087
0.9579
13
14
13
13
1.4320
1.3199
1.1848
1.1251
16
18
15
15
1.6632
1.5330
1.3761
1.3067
19
19
17
17
1.8970
1.7485
1.5695
1.4904
20
21
19
19
2.2795
2.1786
2.1011
2.0081
1.8860
1.8025
1.7910
1.7117
27
22
26
23
23
21
22
22
2.7217
0.7556
2.5087
0.6464
2.2518
0.5818
2.1384
0.5295
30
10
30
10
27
8
26
8
1.0305
0.8817
0.7935
0.7222
13
11
10
10
1.1487
0.9828
0.8846
0.8051
12
13
12
11
1.2934
1.1066
0.9959
0.9064
15
14
13
12
1.5739
1.3466
1.2119
1.1030
17
17
16
14
1.9530
1.6709
1.5039
1.3687
21
21
18
18
2.6307
2.2508
2.0257
1.8437
36
28
24
22
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08AUR2
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Federal Register / Vol. 73, No. 154 / Friday, August 8, 2008 / Rules and Regulations
TABLE 1—RELATIVE WEIGHTS AND AVERAGE LENGTHS OF STAY FOR CASE-MIX GROUPS—Continued
CMG
0301 ...............
0302 ...............
0303 ...............
0304 ...............
0401 ...............
0402 ...............
0403 ...............
0404 ...............
0405 ...............
0501 ...............
0502 ...............
0503 ...............
0504 ...............
0505 ...............
0506 ...............
0601 ...............
0602 ...............
0603 ...............
0604 ...............
0701 ...............
0702 ...............
0703 ...............
0704 ...............
0801 ...............
0802 ...............
0803 ...............
0804 ...............
pwalker on PROD1PC71 with RULES2
0805 ...............
0806 ...............
0901 ...............
0902 ...............
VerDate Aug<31>2005
CMG
description
(M=motor,
C=cognitive,
A=age)
Relative weight
Tier 1
Non-traumatic brain injury:
M>41.05.
Non-traumatic brain injury:
M>35.05 and M<41.05.
Non-traumatic brain injury:
M>26.15 and M<35.05.
Non-traumatic brain injury:
M<26.15.
Traumatic spinal cord injury:
M>48.45.
Traumatic spinal cord injury:
M>30.35 and M<48.45.
Traumatic spinal cord injury:
M>16.05 and M<30.35.
Traumatic spinal cord injury:
M<16.05 and A>63.5.
Traumatic spinal cord injury:
M<16.05 and A<63.5.
Non-traumatic spinal cord injury: M>51.35.
Non-traumatic spinal cord injury: M>40.15 and
M<51.35.
Non-traumatic spinal cord injury: M>31.25 and
M<40.15.
Non-traumatic spinal cord injury: M>29.25 and
M<31.25.
Non-traumatic spinal cord injury: M>23.75 and
M<29.25.
Non-traumatic spinal cord injury: M<23.75.
Neurological: M>47.75 .........
Neurological: M>37.35 and
M<47.75.
Neurological: M>25.85 and
M<37.35.
Neurological: M<25.85 .........
Fracture of lower extremity:
M>42.15.
Fracture of lower extremity:
M>34.15 and M<42.15.
Fracture of lower extremity:
M>28.15 and M<34.15.
Fracture of lower extremity:
M<28.15.
Replacement of lower extremity joint: M>49.55.
Replacement of lower extremity joint: M>37.05 and
M<49.55.
Replacement of lower extremity joint: M>28.65 and
M<37.05 and A>83.5.
Replacement of lower extremity joint: M>28.65 and
M<37.05 and A<83.5.
Replacement of lower extremity joint: M>22.05 and
M<28.65.
Replacement of lower extremity joint: M<22.05.
Other orthopedic: M>44.75 ..
Other orthopedic: M>34.35
and M<44.75.
17:29 Aug 07, 2008
Jkt 214001
Tier 2
Tier 3
Average length of stay
None
Tier 1
Tier 2
Tier 3
None
1.1084
0.9308
0.8358
0.7650
12
12
11
10
1.4120
1.1857
1.0647
0.9746
14
15
13
13
1.6938
1.4224
1.2772
1.1691
17
17
16
15
2.3130
1.9424
1.7441
1.5966
27
23
21
20
0.9255
0.7883
0.7732
0.6566
12
12
11
9
1.3933
1.1868
1.1640
0.9886
17
15
16
13
2.2823
1.9440
1.9067
1.6194
28
23
23
21
3.9766
3.3872
3.3222
2.8215
53
40
37
34
.0347
2.5850
2.5354
2.1532
42
30
29
27
0.8107
0.6397
0.5945
0.5245
9
9
8
8
1.0994
0.8675
0.8062
0.7113
13
11
11
10
1.4315
1.1296
1.0497
0.9261
16
14
13
13
1.7229
1.3596
1.2634
1.1147
21
17
16
15
2.0360
1.6066
1.4930
1.3173
23
21
19
17
2.8325
2.2351
2.0770
1.8325
32
27
25
23
0.9245
1.2366
0.7546
1.0094
0.7174
0.9596
0.6542
0.8750
11
12
9
13
10
12
9
12
1.5763
1.2866
1.2232
1.1154
16
16
15
14
2.0887
0.9187
1.7049
0.7742
1.6208
0.7300
1.4780
0.6563
24
11
21
10
20
10
18
9
1.2116
1.0209
0.9627
0.8655
14
14
12
12
1.4846
1.2510
1.1797
1.0606
16
16
15
14
1.8994
1.6005
1.5093
1.3569
20
20
19
17
0.7000
0.5704
0.5172
0.4714
8
7
8
7
0.9380
0.7643
0.6931
0.6317
10
10
9
9
1.3383
1.0905
0.9889
0.9013
14
13
13
12
1.1745
0.9571
0.8679
0.7910
13
12
11
10
1.4661
1.1947
1.0833
0.9874
16
16
13
13
1.8139
1.4780
1.3403
1.2215
18
18
17
15
0.8584
1.1473
0.7574
1.0122
0.6829
0.9127
0.6041
0.8074
10
13
10
13
9
12
9
11
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Sfmt 4700
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Federal Register / Vol. 73, No. 154 / Friday, August 8, 2008 / Rules and Regulations
TABLE 1—RELATIVE WEIGHTS AND AVERAGE LENGTHS OF STAY FOR CASE-MIX GROUPS—Continued
CMG
0903 ...............
0904 ...............
1001 ...............
1002 ...............
1003 ...............
1101 ...............
1102 ...............
1201 ...............
1202 ...............
1203 ...............
1301 ...............
1302 ...............
1303 ...............
1401 ...............
1402 ...............
1403 ...............
1404 ...............
1501 ...............
1502 ...............
1503 ...............
1504 ...............
1601 ...............
1602 ...............
1603 ...............
1701 ...............
1702 ...............
1703 ...............
1704 ...............
1801 ...............
1802 ...............
pwalker on PROD1PC71 with RULES2
1803 ...............
1901 ...............
1902 ...............
1903 ...............
2001 ...............
VerDate Aug<31>2005
CMG
description
(M=motor,
C=cognitive,
A=age)
Relative weight
Tier 1
Other orthopedic: M>24.15
and M<34.35.
Other orthopedic: M<24.15 ..
Amputation, lower extremity:
M>47.65.
Amputation, lower extremity:
M>36.25 and M<47.65.
Amputation, lower extremity:
M<36.25.
Amputation, non-lower extremity: M>36.35.
Amputation, non-lower extremity: M<36.35.
Osteoarthritis: M>37.65 ........
Osteoarthritis: M>30.75 and
M<37.65.
Osteoarthritis: M<30.75 ........
Rheumatoid, other arthritis:
M>36.35.
Rheumatoid, other arthritis:
M>26.15 and M<36.35.
Rheumatoid, other arthritis:
M<26.15.
Cardiac: M>48.85 .................
Cardiac: M>38.55 and
M<48.85.
Cardiac: M>31.15 and
M<38.55.
Cardiac: M<31.15 .................
Pulmonary: M>49.25 ............
Pulmonary: M>39.05 and
M<49.25.
Pulmonary: M>29.15 and
M<39.05.
Pulmonary: M<29.15 ............
Pain syndrome: M>37.15 .....
Pain syndrome: M>26.75
and M<37.15.
Pain syndrome: M<26.75 .....
Major multiple trauma without brain or spinal cord injury: M>39.25.
Major multiple trauma without brain or spinal cord injury: M>31.05 and
M<39.25.
Major multiple trauma without brain or spinal cord injury: M>25.55 and
M<31.05.
Major multiple trauma without brain or spinal cord injury: M<25.55.
Major multiple trauma with
brain or spinal cord injury:
M>40.85.
Major multiple trauma with
brain or spinal cord injury:
M>23.05 and M<40.85.
Major multiple trauma with
brain or spinal cord injury:
M<23.05.
Guillian Barre: M>35.95 .......
Guillian Barre: M>18.05 and
M<35.95.
Guillian Barre: M<18.05 .......
Miscellaneous: M>49.15 ......
17:29 Aug 07, 2008
Jkt 214001
Tier 2
Tier 3
Average length of stay
None
Tier 1
Tier 2
Tier 3
None
1.4840
1.3093
1.1806
1.0443
16
16
15
14
1.9620
0.9356
1.7310
0.9061
1.5608
0.7797
1.3807
0.7137
22
11
22
12
19
11
18
10
1.2522
1.2127
1.0435
0.9552
14
15
13
12
1.8193
1.7619
1.5161
1.3877
19
21
19
17
1.1846
0.9851
0.9851
0.8558
12
12
13
11
1.7288
1.4377
1.4377
1.2490
17
18
17
15
1.0319
1.3034
0.9668
1.2212
0.8483
1.0715
0.7541
0.9525
11
14
12
15
11
13
10
13
1.6379
1.0983
1.5346
0.9874
1.3465
0.8499
1.1969
0.7648
16
12
18
12
17
11
15
10
1.4790
1.3296
1.1445
1.0299
15
16
14
13
1.9140
1.7208
1.4812
1.3329
24
22
18
17
0.8003
1.1095
0.7221
1.0010
0.6388
0.8856
0.5667
0.7856
10
13
11
13
9
12
8
11
1.3578
1.2251
1.0838
0.9615
15
15
13
13
1.7628
0.9603
1.2297
1.5905
0.8386
1.0739
1.4071
0.7413
0.9494
1.2483
0.7038
0.9013
20
11
13
20
12
13
17
10
12
16
9
11
1.5640
1.3658
1.2074
1.1463
16
17
14
14
1.9525
1.1094
1.4978
1.7051
0.8968
1.2108
1.5073
0.7667
1.0351
1.4310
0.7068
0.9543
22
13
16
19
13
16
17
10
13
17
10
13
1.9287
1.0454
1.5590
0.9189
1.3328
0.8461
1.2287
0.7419
22
11
19
12
17
11
16
10
1.3777
1.2110
1.1151
0.9778
14
15
14
13
1.6566
1.4561
1.3408
1.1757
18
17
16
15
2.0776
1.8261
1.6815
1.4744
23
24
21
19
1.2189
0.9629
0.9044
0.7757
15
13
13
10
1.8398
1.4533
1.3651
1.1708
19
17
16
15
3.1442
2.4838
2.3329
2.0009
37
31
26
24
1.1582
2.3408
0.9288
1.8772
0.9288
1.8772
0.8782
1.7749
15
26
11
22
11
25
12
22
3.5944
0.8820
2.8825
0.7282
2.8825
0.6614
2.7254
0.5928
33
11
35
9
41
9
31
8
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46377
Federal Register / Vol. 73, No. 154 / Friday, August 8, 2008 / Rules and Regulations
TABLE 1—RELATIVE WEIGHTS AND AVERAGE LENGTHS OF STAY FOR CASE-MIX GROUPS—Continued
CMG
2002 ...............
2003 ...............
2004 ...............
2101 ...............
5001 ...............
5101 ...............
5102 ...............
5103 ...............
5104 ...............
CMG
description
(M=motor,
C=cognitive,
A=age)
Relative weight
Tier 1
Miscellaneous: M>38.75 and
M<49.15.
Miscellaneous: M>27.85 and
M<38.75.
Miscellaneous: M<27.85 ......
Burns: M>0 ...........................
Short-stay cases, length of
stay is 3 days or fewer.
Expired, orthopedic, length
of stay is 13 days or fewer.
Expired, orthopedic, length
of stay is 14 days or more.
Expired, not orthopedic,
length of stay is 15 days
or fewer.
Expired, not orthopedic,
length of stay is 16 days
or more.
pwalker on PROD1PC71 with RULES2
V. FY 2009 IRF PPS Federal
Prospective Payment Rates
A. Increase Factor and Labor-Related
Share for FY 2009
Section 1886(j)(3)(C) of the Act
requires the Secretary to establish an
increase factor that reflects changes over
time in the prices of an appropriate mix
of goods and services included in the
covered IRF services, which is referred
to as a market basket index. According
to section 1886(j)(3)(A)(i) of the Act, the
increase factor shall be used to update
the IRF Federal prospective payment
rates for each FY. However, section 115
of the MMSEA, amended section
1886(j)(3)(C) of the Act to apply a zero
percent increase factor for FYs 2008 and
2009, effective for IRF discharges
occurring on or after April 1, 2008.
Thus, we are applying an increase factor
of zero percent to update the IRF
Federal prospective payment rates for
FY 2009 in this final rule.
We continue to use the methodology
described in the FY 2006 IRF PPS final
rule to update the IRF labor-related
share for FY 2009 (70 FR 47880, 47908
through 47917). The IRF labor-related
share for FY 2009 is the sum of the FY
2009 relative importance of each laborrelated cost category, and reflects the
different rates of price change for these
cost categories between the base year
(FY 2002) and FY 2009. Consistent with
our proposal to update the labor-related
share with the most recent available
data, the labor-related share for this
final rule reflects Global Insight’s
second quarter 2008 forecast. (Global
Insight is a nationally recognized
economic and financial forecasting firm
VerDate Aug<31>2005
17:29 Aug 07, 2008
Jkt 214001
Tier 2
Average length of stay
Tier 3
None
Tier 1
Tier 2
Tier 3
None
1.1873
0.9803
0.8904
0.7980
12
13
11
11
1.5231
1.2575
1.1422
1.0237
16
16
14
13
2.0363
2.3666
................
1.6812
2.3666
................
1.5271
2.1481
................
1.3686
1.7454
0.1476
22
25
................
20
25
................
19
25
................
17
17
3
................
................
................
0.6783
................
................
................
8
................
................
................
1.5432
................
................
................
19
................
................
................
0.7086
................
................
................
9
................
................
................
1.9586
................
................
................
23
that contracts with CMS to forecast the
components of providers’ market
baskets.) As shown in Table 2, the total
FY 2009 Rehabilitation, Psychiatric, and
Long-Term Care Hospital Market Basket
(RPL) labor-related share in this final
rule is 75.464 percent.
TABLE 2—FY 2009 IRF RPL LABORRELATED SHARE RELATIVE IMPORTANCE
FY 2009 IRF
labor-related
share relative
importance
Cost category
Wages and salaries ..........
Employee benefits ............
Professional fees ..............
All other labor intensive
services .........................
52.552
13.982
2.890
Subtotal .....................
Labor-related share of
capital costs (.46) ..........
71.544
Total ...................
75.464
2.120
3.920
SOURCE: GLOBAL INSIGHT, INC, 2nd
QTR, 2008; @USMACRO/CONTROL0508
@CISSIM/TL0508.SIM Historical Data through
1st QTR, 2008.
We received five comments on the
increase factor and labor-related share
for FY 2009, which are summarized
below.
Comment: Two commenters
expressed concern that the zero percent
increase factor that we are applying to
the IRF Federal prospective payment
rates for FY 2009, would impose a
financial burden on IRFs. These
commenters noted that the zero percent
increase factor for FY 2009 was required
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by section 115 of the MMSEA, which
also made revisions to the 60 percent
rule. The commenters requested that
any future legislative changes to the 60
percent rule also be considered in
combination with updates to the IRF
Federal prospective payment rates.
Response: As we discussed in the FY
2009 IRF PPS proposed rule (73 FR
22674, 22680 through 22681), section
115 of the MMSEA amended section
1886(j)(3)(C) of the Act to apply a zero
percent increase factor for FYs 2008 and
2009, effective for IRF discharges
occurring on or after April 1, 2008.
While we understand that the effect of
the zero percent increase factor is to
maintain FY 2009 IRF PPS payment
rates at FY 2008 levels, the statute does
not give CMS the discretion to
implement an increase factor other than
zero percent for FY 2009. We will
respond to any future legislative
changes to the 60 percent rule
accordingly.
Comment: One commenter requested
that CMS calculate the IRF PPS market
basket estimates using more current
market basket data. This commenter
stated that the FY 2009 market basket
estimate is based on data from FY 2002,
and that the FY 2002 data underestimate
the increase in costs, especially labor
costs, that IRFs have experienced. The
commenter suggested that CMS use
Medicare cost report data to compute
the market basket estimate, rather than
data from the Bureau of Labor Statistics,
in order to make the estimate more
current.
Response: The IRF PPS market basket,
which is a fixed weight, Laspeyres-type
price index, is constructed in three
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steps. First, a base period is selected (FY
2002 in the current market basket) and
total base period expenditures are
estimated for a set of mutually exclusive
and exhaustive spending categories
based upon type of expenditure. The
proportion of total operating costs that
each category represents is called a cost
or expenditure weight.
Medicare Cost Report (MCR) data are
used to derive the primary cost weights
for the market basket. We monitor the
stability of these cost weights and have
determined that they do not tend to
fluctuate over short periods of time
(such as a period of less than 5 years).
In general, we have typically rebased
(recalculated market basket cost
weights) approximately every 5 years.
We note that we last revised and
rebased the market basket in the FY
2006 IRF PPS final rule (70 FR 47880,
47915 through 47917).
Second, the FY 2002 expenditure
weight for each cost category is matched
to an appropriate price or wage variable,
referred to as a price proxy. These price
proxies are selected to reflect the rateof-price change for each expenditure
category and are primarily obtained
from the Bureau of Labor Statistics
(BLS).
Finally, each FY 2002 cost weight 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.
The final IRF market basket update for
FY 2009 is calculated using the market
basket levels from the second quarter of
2008 (2008Q2) forecast prepared by
Global Insight, Inc. (GII). These levels
reflect the most recent price data
available (historical price data through
2008Q1 and forecasted price data for
2008Q2 and beyond).
Given the methodology described
above, the current market basket
estimate is not based solely on FY 2002
data, but rather is calculated by
applying the most recent available price
data for each quarter to the FY 2002 cost
weights. Thus, the current FY 2009
market basket estimate does in fact
reflect recent price increases
experienced by IRFs.
Comment: Several commenters
expressed concern about the
methodology for computing the laborrelated share. One commenter requested
that we begin updating the labor-related
share more frequently using the most
recent available data. The commenter
stated that the current calculation of the
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labor-related share is based on 2002
data. Another commenter said that the
methodology does not adequately reflect
the difficulty IRFs have in recruiting a
skilled labor force.
Response: The FY 2009 labor-related
share is intended to reflect those costs
that are related to, influenced by, or
vary with the local labor market.
Accordingly, the share is calculated as
the sum of the relative importance of the
appropriate categories which include
wages and salaries, fringe benefits,
professional fees, labor-intensive
services, and a portion of capital costs.
We calculate this share based on the
RPL market basket, which we believe
adequately captures the current cost
structures of Medicare-participating
IRFs.
By following a four-step process to
estimate the labor-related relative
importance for FY 2009, we are making
use of up-to-date data that reflect
current trends. As a result, the laborrelated share appropriately reflects
current labor market price pressures
experienced by IRFs. The process is as
follows: First, we compute the FY 2009
price index level for the total market
basket and each cost category of the
market basket. Second, we calculate a
ratio for each cost category by dividing
the FY 2009 price index level for that
cost category by the total market basket
price index level. Third, we determine
the FY 2009 relative importance for
each cost category by multiplying this
ratio by the base year (FY 2002) weight.
Finally, we sum the FY 2009 relative
importance for each of the labor-related
categories to produce the FY 2009 laborrelated relative importance.
The price proxies that move the
different cost categories in the market
basket do not necessarily change at the
same rate, and the relative importance
captures these potential differential
growth rates. Accordingly, the relative
importance figure more closely reflects
the cost share weights for FY 2009 when
compared to the base year weights from
the 2002-based RPL market basket. We
revised and rebased the market basket
and labor-related share in FY 2006 and
expect to conduct additional updates on
a regular basis.
Final Decision: We will continue to
apply a zero percent increase factor to
the IRF Federal prospective payment
rates for FY 2009, in accordance with
section 115 of the MMSEA. Further, we
will continue to update the IRF laborrelated share using our current
methodology, which reflects the most
recent available data. Thus, for this final
rule, the labor-related share is 75.464
percent. This is based on the GII’s
forecast for the second quarter of 2008
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(2008Q2) with historical data through
the first quarter of 2008 (2008Q1).
B. Area Wage Adjustment
Section 1886(j)(6) of the Act requires
the Secretary to adjust the proportion
(as estimated by the Secretary from time
to time) of rehabilitation facilities’ costs
attributable to wages and wage-related
costs by a factor (established by the
Secretary) reflecting the relative hospital
wage level in the geographic area of the
rehabilitation facility compared to the
national average wage level for those
facilities. The Secretary is required to
update the IRF PPS wage index on the
basis of information available to the
Secretary on the wages and wage-related
costs to furnish rehabilitation services.
Any adjustments or updates made under
section 1886(j)(6) of the Act for a FY are
made in a budget neutral manner.
In the FY 2008 IRF PPS final rule (72
FR 44284 at 44299), we maintained the
methodology described in the FY 2006
IRF PPS final rule to determine the wage
index, labor market area definitions, and
hold harmless policy consistent with
the rationale outlined in the FY 2006
IRF PPS final rule (70 FR 47880, 47917
through 47933).
For FY 2009, we proposed to and will
maintain the policies and
methodologies described in the FY 2008
IRF PPS final rule relating to the labor
market area definitions and the wage
index methodology for areas with wage
data. Therefore, this final rule continues
to use the Core-Based Statistical Area
(CBSA) labor market area definitions
and the pre-reclassification and prefloor hospital wage index data based on
2004 cost report data.
When adopting new labor market
designations made by the Office of
Management and Budget (OMB), we
identified some geographic areas where
there were no hospitals and, thus, no
hospital wage index data on which to
base the calculation of the IRF PPS wage
index. We continue to use the same
methodology discussed in the FY 2008
IRF PPS final rule (72 FR 44284 at
44299) to address those geographic areas
where there are no hospitals and, thus,
no hospital wage index data on which
to base the calculation of the FY 2009
IRF PPS wage index.
Additionally, this final rule
incorporates the CBSA changes
published in the most recent OMB
bulletin that applies to the hospital
wage data used to determine the current
IRF PPS wage index. The changes were
nomenclature and did not represent
substantive changes to the CBSA-based
designations. Specifically, OMB added
or deleted certain CBSA numbers and
revised certain titles. The OMB bulletins
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are available online at https://
www.whitehouse.gov/omb/bulletins/
index.html.
1. Clarification of New England Deemed
Counties
We are taking this opportunity to
address the change in the treatment of
‘‘New England deemed counties’’ (that
is, those counties in New England listed
in § 412.64(b)(1)(ii)(B) of the regulations
that were deemed to be parts of urban
areas under section 601(g) of the Social
Security Amendments of 1983) that was
made in the FY 2008 Inpatient
Prospective Payment System (IPPS)
final rule with comment period (72 FR
47337). These counties include the
following: Litchfield County, CT; York
County, ME; Sagadahoc County, ME;
Merrimack County, NH; and Newport
County, RI. Of these five ‘‘New England
deemed counties,’’ three (York County,
ME, Sagadahoc County, ME, and
Newport County, RI) are also included
in metropolitan statistical areas (MSAs)
defined by OMB and are considered
urban under both the current IPPS and
IRF PPS labor market area definitions in
§ 412.64(b)(1)(ii)(A). The remaining two,
Litchfield County, CT and Merrimack
County, NH, are geographically located
in areas that are considered rural under
the current IPPS (and IRF PPS) labor
market area definitions, but have been
previously deemed urban under the
IPPS in certain circumstances, as
discussed below.
In the FY 2008 IPPS final rule with
comment period, (72 FR 47337 through
47338), § 412.64(b)(1)(ii)(B) was revised
that the two ‘‘New England deemed
counties’’ that are still considered rural
under the OMB definitions (Litchfield
County, CT and Merrimack County,
NH), are no longer considered urban,
effective for discharges occurring on or
after October 1, 2007, and, therefore, are
considered rural in accordance with
§ 412.64(b)(1)(ii)(C). However, for
purposes of payment under the IPPS,
acute care hospitals located within
those areas are treated as being
reclassified to their deemed urban area
effective for discharges occurring on or
after October 1, 2007 (see 72 FR 47337
through 47338). We note that the IRF
PPS does not provide for geographic
reclassification. Also, in the FY 2008
IPPS final rule with comment period (72
FR 47338), we explained that we limited
this policy change for the ‘‘New England
deemed counties’’ only to IPPS
hospitals, and any change to non-IPPS
provider wage indexes would be
addressed in the respective payment
system rules.
Accordingly, as stated above, we are
taking this opportunity to clarify the
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treatment of ‘‘New England deemed
counties’’ under the IRF PPS in this
final rule.
As discussed above, the IRF PPS has
consistently used the IPPS definition of
‘‘urban’’ and ‘‘rural’’ with regard to the
wage index used in the IRF PPS. Under
existing § 412.602, an IRF’s wage index
is determined based on the location of
the IRF in an urban or rural area as
defined in §§ 412.64(b)(1)(ii)(A) through
(C).
Historical changes to the labor market
area/geographic classifications and
annual updates to the wage index values
under the IRF PPS are made effective
October 1 each year. When we
established the most recent IRF PPS
payment rate update, effective for
discharges occurring on or after October
1, 2007 through September 30, 2008, we
considered the ‘‘New England deemed
counties’’ (including Litchfield County,
CT and Merrimack County, NH) as
urban for FY 2008, as evidenced by the
inclusion of Litchfield County, CT as
one of the constituent counties of urban
CBSA 25540 (Hartford-West HartfordEast Hartford, CT), and the inclusion of
Merrimack County, NH as one of the
constituent counties of urban CBSA
31700 (Manchester-Nashua, NH).
As noted above, § 412.602 indicates
that the terms ‘‘rural’’ and ‘‘urban’’ are
defined according to the definitions of
those terms in §§ 412.64(b)(1)(ii)(A)
through (C). Applying the IPPS
definitions, Litchfield County, CT and
Merrimack County, NH are not
considered ‘‘urban’’ under
§§ 412.64(b)(1)(ii)(A) and (B) as revised
under the FY 2008 IPPS final rule and,
therefore, are considered ‘‘rural’’ under
§ 412.64(b)(1)(ii)(C). Accordingly,
reflecting our policy to use the IPPS
definitions of ‘‘urban’’ and ‘‘rural’’,
these two counties would be considered
‘‘rural’’ under the IRF PPS effective with
the next update of the IRF PPS payment
rates, October 1, 2008, and would no
longer be included in urban CBSA
25540 (Hartford-West Hartford-East
Hartford, CT) and urban CBSA 31700
(Manchester-Nashua, NH), respectively.
We note that this policy is consistent
with our policy of not taking into
account IPPS geographic
reclassifications in determining
payments under the IRF PPS. We do not
need to make any changes to our
regulations to effectuate this change.
There is one IRF (in Merrimack
County, NH) that greatly benefits from
treating these counties as rural. This IRF
would begin to receive a higher wage
index value and the 21.3 percent
adjustment that is applied to IRF PPS
payments for rural facilities. Currently,
there are no IRFs in the following areas:
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Litchfield County, CT; rural
Connecticut; or rural New Hampshire.
2. Multi-Campus Hospital Wage Index
Data
In the FY 2008 IRF PPS final rule (72
FR 44284, August 7, 2007), we
established IRF PPS wage index values
for FY 2008 calculated from the same
data (collected from cost reports
submitted by hospitals for cost reporting
periods beginning during FY 2003) used
to compute the FY 2007 acute care
hospital inpatient wage index, without
taking into account geographic
reclassification under sections
1886(d)(8) and (d)(10) of the Act. The
IRF PPS wage index values applicable
for discharges occurring on or after
October 1, 2007 through September 30,
2008 are shown in Table 1 (for urban
areas) and Table 2 (for rural areas) in the
addendum to the FY 2008 IRF PPS final
rule (72 FR 44284, 44312 through
44335).
We are continuing to use IPPS wage
data for the FY 2009 IRF PPS Wage
Index, because we believe that using the
hospital inpatient wage data is
appropriate and reasonable for the IRF
PPS. We note that the IPPS wage data
used to determine the FY 2009 IRF wage
index values reflect our policy that was
adopted under the IPPS beginning in FY
2008. The wage data for multi-campus
hospitals located in different labor
market areas (CBSAs) are apportioned to
each CBSA where the campuses are
located (see the FY 2008 IPPS final rule
with comment period (72 FR 47317
through 47320)). We computed the FY
2009 IRF PPS wage index values
presented in this final rule consistent
with our pre-reclassified IPPS wage
index policy (that is, our historical
policy of not taking into account IPPS
geographic reclassifications in
determining payments under the IRF
PPS).
For the FY 2009 IRF PPS, we
computed the wage index from IPPS
wage data (submitted by hospitals for
cost reporting periods beginning in FY
2004 and used in the FY 2008 IPPS
wage index), which allocated salaries
and hours to the campuses of two multicampus hospitals with campuses that
are located in different labor areas, one
in Massachusetts and another in Illinois.
Thus, the FY 2009 IRF PPS wage index
values for the following CBSAs are
affected by this policy: Boston-Quincy,
MA (CBSA 14484), Providence-New
Bedford-Falls River, RI-MA (CBSA
39300), Chicago-Naperville-Joliet, IL
(CBSA 16974) and Lake CountyKenosha County, IL-WI (CBSA 29404)
(please refer to Table 1 in the addendum
of this final rule).
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3. Methodology for Applying the
Revisions to the Area Wage Adjustment
for FY 2009 in a Budget-Neutral Manner
To calculate the wage-adjusted facility
payment for the payment rates set forth
in this final rule, we multiply the
unadjusted Federal prospective
payment by the FY 2009 RPL laborrelated share (75.464 percent) to
determine the labor-related portion of
the Federal prospective payments. We
then multiply this labor-related portion
by the applicable IRF wage index shown
in Table 1 for urban areas and Table 2
for rural areas in the addendum.
Adjustments or updates to the IRF
wage index made under section
1886(j)(6) of the Act must be made in a
budget neutral manner; therefore, we
calculated a budget neutral wage
adjustment factor as established in the
FY 2004 IRF PPS final rule (68 FR 45674
at 45689), codified at § 412.624(e)(1),
and described in the steps below. We
proposed to use (and have used for this
final rule) the following steps to ensure
that the FY 2009 IRF standard payment
conversion factor reflects the update to
the proposed wage indexes (based on
the FY 2004 pre-reclassified and prefloor hospital wage data) and the laborrelated share in a budget neutral
manner:
Step 1. Determine the total amount of
the estimated FY 2008 IRF PPS rates,
using the FY 2008 standard payment
conversion factor and the labor-related
share and the wage indexes from FY
2008 (as published in the FY 2008 IRF
PPS final rule (72 FR 44284 at 44301,
44298, and 44312 through 44335,
respectively)).
Step 2. Calculate the total amount of
estimated IRF PPS payments, using the
FY 2008 standard payment conversion
factor and the FY 2009 labor-related
share and CBSA urban and rural wage
indexes.
Step 3. Divide the amount calculated
in step 1 by the amount calculated in
step 2, which equals the final FY 2009
budget neutral wage adjustment factor
of 1.0003. (Note that this final budget
neutral wage adjustment factor differs
from the one we proposed in the
proposed rule (1.0004) because of the
use of updated data to calculate the
labor-related share for this final rule and
the use of updated FY 2007 IRF claims
data for this final rule.)
Step 4. Apply the FY 2009 budget
neutral wage adjustment factor from
step 3 to the FY 2008 IRF PPS standard
payment conversion factor after the
application of the estimated market
basket update to determine the FY 2009
standard payment conversion factor.
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We received 4 comments on the
proposed FY 2009 IRF PPS wage index,
which are summarized below.
Comment: Several commenters
recommended that we consider wage
index policies under the acute IPPS
because IRFs compete in a similar labor
pool as acute care hospitals. The IPPS
wage index policies would allow IRFs to
benefit from the IPPS reclassification
and/or floor policies. Several
commenters also recommended that
CMS conduct further analysis of the
wage index methodology to ensure that
fluctuations in the annual wage index
for hospitals are minimized, that all
future updates match the costs of labor
in the market, that IRF’s occupational
mix is appropriately recognized, and
that payments are ‘‘smoothed’’ across
geography and across time. Further, one
provider requested that the same wage
index policies be used for all healthcare
providers, to maintain consistency.
Response: We do not believe IPPS
wage index policies should be applied
to IRFs. We note the IRF PPS does not
account for geographic reclassification
under sections 1886(d)(8) and (d)(10) of
the Act and does not apply the ‘‘rural
floor’’ under section 4410 of Public Law
105–33(BBA). Because we do not have
an IRF specific wage index we are
unable to determine at this time the
degree, if any, to which a geographic
reclassification adjustment under the
IRF PPS is appropriate. Furthermore, we
believe the ‘‘rural floor’’ is applicable
only to the acute care hospital payment
system. The rationale for our current
wage index policies is fully described in
the FY 2006 final rule (70 FR 47880,
47926 through 47928).
In addition, we reviewed the
Medicare Payment Advisory
Commission’s (MedPAC) wage index
recommendations as discussed in
MedPAC’s June 2007 report titled,
‘‘Report to Congress: Promoting Greater
Efficiency in Medicare.’’ Although some
commenters recommended that we
adopt the IPPS wage index policies such
as reclassification and floor policies, we
note that MedPAC’s June 2007 report to
Congress recommends that Congress
‘‘repeal the existing hospital wage index
statute, including reclassification and
exceptions, and give the Secretary
authority to establish new wage index
systems.’’ We believe that adopting the
IPPS wage index policies, such as
reclassification or floor, would not be
prudent at this time because MedPAC
suggests that the reclassification and
exception policies in the IPPS wage
index alters the wage index values for
one-third of IPPS hospitals. In addition,
MedPAC found that the exceptions may
lead to anomalies in the wage index. By
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adopting the IPPS reclassification and
exceptions at this time, the IRF PPS
wage index may be vulnerable to similar
issues that MedPAC identified in their
June 2007 Report to Congress. However,
we will continue to review and consider
MedPAC’s recommendations on a
refined or an alternative wage index
methodology for the IRF PPS in future
years.
We would also like to inform the
commenter about our current research
with respect to wage index
methodology, including the issues the
commenter mentioned about ensuring
that the wage index minimizes
fluctuations, matches the costs of labor
in the market, and provides for a single
wage index policy. Section 106(b)(2) of
the MIEA–TRHCA instructed the
Secretary of Health and Human
Services, to take into account MedPAC’s
recommendations on the Medicare wage
index classification system, to include
in the FY 2009 IPPS proposed rule one
or more proposals to revise the wage
index adjustment applied under section
1886(d)(3)(E) of the Act for purposes of
the IPPS. The proposal (or proposals)
must consider each of the following:
• Problems associated with the
definition of labor markets for the wage
index adjustment.
• The modification or elimination of
geographic reclassifications and other
adjustments.
• The use of Bureau of Labor of
Statistics data or other data or
methodologies to calculate relative
wages for each geographic area.
• Minimizing variations in wage
index adjustments between and within
MSAs and statewide rural areas.
• The feasibility of applying all
components of CMS’s proposal to other
settings.
• Methods to minimize the volatility
of wage index adjustments while
maintaining the principle of budget
neutrality.
• The effect that the implementation
of the proposal would have on health
care providers on each region of the
country.
• Methods for implementing the
proposal(s) including methods to phase
in such implementations.
• Issues relating to occupational mix
such as staffing practices and any
evidence on quality of care and patient
safety including any recommendation
for alternative calculations to the
occupational mix.
To assist us in meeting the
requirements of section 106(b)(2) of
Public Law 109–432, in February 2008,
we awarded a Task Order under its
Expedited Research and Demonstration
Contract, to Acumen, LLC. A
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comparison of the current IPPS wage
index and MedPAC’s recommendations
will be presented in the FY 2009 IPPS
final rule. We plan to monitor these
efforts and the impact or influence they
may have to the IRF PPS wage index.
Comment: One commenter requested
that the IRF wage index values for FY
2009 be capped at plus or minus 2
percent of the IRF wage index values for
FY 2008 to provide for more stable, and
thus more predictable, changes in the
IRF wage index between FY 2008 and
FY 2009.
Response: We will take the
commenter’s suggestion into account for
the future. However, we do not believe
that the IRF wage index would
accurately reflect geographic variations
in the costs of labor, which is the
purpose of the IRF wage index, if we
were to constrain changes in the wage
index adjustment from year to year.
Thus, we believe it is best at this point
to continue the analysis of the wage
index methodology, as described above,
and to consider developing wage index
policies that are consistent across
settings as noted in the previous
response.
Final Decision: We will continue to
use the policies and methodologies
described in the FY 2008 IRF PPS final
rule relating to the labor market area
definitions and the wage index
methodology for areas with wage data.
Therefore, this final rule continues to
use the Core-Based Statistical Area
(CBSA) labor market area definitions
and the pre-reclassification and prefloor hospital wage index data based on
2004 cost report data. We discuss the
final standard payment conversion
factor for FY 2009 in the next section
below.
C. Description of the IRF Standard
Payment Conversion Factor and
Payment Rates for FY 2009
To calculate the standard payment
conversion factor for FY 2009, as
illustrated in Table 4 below, we begin
with the standard payment conversion
factor for FY 2008. To explain how we
determined the standard payment
conversion factor for FY 2008, we
include Table 3 below. The final FY
2008 IRF standard payment conversion
factor that we show in Tables 3 and 4
below is different than the IRF standard
payment conversion factor that we
published in the FY 2008 IRF PPS final
rule (72 FR 44284 at 44301) due to a
legislative change. We adjusted the IRF
standard payment conversion factor for
IRF discharges occurring on or after
April 1, 2008 to reflect the changes
codified in section 115 of the MMSEA
that require the Secretary to apply a zero
percent increase factor for FYs 2008 and
2009, effective for discharges occurring
on or after April 1, 2008.
In the FY 2008 IRF PPS final rule (72
FR 44284, 44300 through 44301), we
used the RPL market basket estimate
described in that final rule (3.2 percent)
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to update the IRF standard payment
conversion factor. As shown in Table 3
of the FY 2008 IRF PPS final rule (72 FR
44284 at 44301), applying this market
basket estimate to the standard payment
amount resulted in a final standard
payment conversion factor for FY 2008
of $13,451.
However, section 115 of the MMSEA
had the effect of changing the increase
factor for FY 2008 from 3.2 percent to
zero percent for discharges occurring on
or after April 1, 2008. This, in turn, had
the effect of decreasing the IRF standard
payment conversion factor for
discharges occurring on or after April 1,
2008.
As shown in Table 3 below, to
develop the FY 2008 standard payment
conversion factor for discharges
beginning on or after April 1, 2008, we
started with the FY 2007 standard
payment conversion factor that was
finalized in the FY 2007 IRF PPS final
rule (71 FR 48354 at 48378). We then
multiplied this by the zero percent
increase factor, as described above.
Then, we applied the same FY 2008
budget neutrality factor (1.0041) for the
Wage Index, Labor-Related Share, and
the Hold Harmless Provision that was
published in the FY 2008 IRF PPS Final
Rule (72 FR 44284 at 44301). This
resulted in the final FY 2008 standard
payment conversion factor, effective for
discharges occurring on or after April 1,
2008, of $13,034.
TABLE 3—CALCULATIONS TO DETERMINE THE FY 2008 IRF STANDARD PAYMENT CONVERSION FACTOR FOR
DISCHARGES BEGINNING ON OR AFTER APRIL 1, 2008
Explanation for adjustment
Calculations
× 1.0041
Standard Payment Conversion Factor for Discharges Occurring on or after April 1, 2008 ...............................................................
pwalker on PROD1PC71 with RULES2
FY 2007 Standard Payment Conversion Factor (published in the FY 2007 IRF PPS Final Rule (71 FR 48354)) ...........................
Zero Percent Increase Factor for Discharges Occurring on or after April 1, 2008 ............................................................................
Budget Neutrality Factor for the Wage Index, Labor-Related Share, and the Hold Harmless Provision that was published in the
FY 2008 IRF PPS Final Rule (72 FR 44284) ..................................................................................................................................
= $13,034
As a result, the IRF standard payment
conversion factor changed from $13,451
for discharges occurring on or after
October 1, 2007 to $13,034 for
discharges occurring on or after April 1,
2008.
Further, as required by section 115 of
the MMSEA, we apply an increase
factor of zero percent to the standard
payment conversion factor for FY 2009,
meaning that it does not change from
the current value of $13,034. Next, we
apply the combined final budget
neutrality factor for the FY 2009 wage
index and labor related share of 1.0003,
which results in a standard payment
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amount of $13,038. Finally, we apply
the final budget neutrality factor for the
revised CMG relative weights of 0.9939,
which results in the final FY 2009
standard payment conversion factor of
$12,958.
As stated previously, we note that the
budget neutrality factor for the FY 2009
wage index and labor related share
changed from 1.0004 in the proposed
rule to 1.0003 in this final rule due to
the use of updated FY 2007 IRF claims
data in this final rule and the update to
the FY 2009 labor-related share for this
final rule using the most recent
available data. Similarly, the budget
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$12,981
× 1.0000
neutrality factor used to update the
CMG relative weights and average
length of stay values changed from
0.9969 in the proposed rule to 0.9939 in
this final rule due to the use of updated
FY 2007 IRF claims data in this final
rule. Furthermore, the methodology that
we used to compute the final budget
neutrality factors for this final rule is the
same methodology (as discussed above
and in section IV of this final rule) that
we used to compute the proposed
budget neutrality factors in the
proposed rule (73 FR 22674 at 22677
and 22683).
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TABLE 4—CALCULATIONS TO DETERMINE THE FY 2009 STANDARD PAYMENT CONVERSION FACTOR
Explanation for adjustment
Calculations
Standard Payment Conversion Factor for Discharges Occurring on or after April 1, 2008 ...............................................................
Zero Percent Increase Factor for FY 2009 .........................................................................................................................................
Budget Neutrality Factor for the Wage Index and Labor-Related Share ............................................................................................
Budget Neutrality Factor for the Revisions to the CMG Relative Weights .........................................................................................
$13,034
× 1.0000
× 1.0003
× 0.9939
FY 2009 Standard Payment Conversion Factor .................................................................................................................................
= $12,958
After the application of the CMG
relative weights described in section IV
of this final rule, the resulting
unadjusted IRF prospective payment
rates for FY 2009 are shown below in
Table 5, ‘‘FY 2009 Payment Rates.’’
TABLE 5—FY 2009 PAYMENT RATES
Payment rate
tier 1
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CMG
0101
0102
0103
0104
0105
0106
0107
0108
0109
0110
0201
0202
0203
0204
0205
0206
0207
0301
0302
0303
0304
0401
0402
0403
0404
0405
0501
0502
0503
0504
0505
0506
0601
0602
0603
0604
0701
0702
0703
0704
0801
0802
0803
0804
0805
0806
0901
0902
0903
0904
1001
1002
1003
1101
1102
Payment rate
tier 2
Payment rate
tier 3
Payment rate
no comorbidity
$9,993.21
12,561.49
14,873.19
15,798.39
18,555.86
21,551.75
24,581.33
29,537.76
28,230.30
35,267.79
9,791.06
13,353.22
14,884.85
16,759.88
20,394.60
25,306.97
34,088.61
14,362.65
18,296.70
21,948.26
29,971.85
11,992.63
18,054.38
29,574.04
51,528.78
39,323.64
10,505.05
14,246.03
18,549.38
22,325.34
26,382.49
36,703.54
11,979.67
16,023.86
20,425.70
27,065.37
11,904.51
15,699.91
19,237.45
24,612.43
9,070.60
12,154.60
17,341.69
15,219.17
18,997.72
23,504.52
11,123.15
14,866.71
19,229.67
25,423.60
12,123.50
16,226.01
23,574.49
15,350.05
22,401.79
$9,210.55
11,579.27
13,709.56
14,562.20
17,103.26
19,864.61
22,657.06
27,226.05
26,020.96
32,507.73
8,376.05
11,425.07
12,735.12
14,339.32
17,449.24
21,651.52
29,165.87
12,061.31
15,364.30
18,431.46
25,169.62
10,214.79
15,378.55
25,190.35
43,891.34
33,496.43
8,289.23
11,241.07
14,637.36
17,617.70
20,818.32
28,962.43
9,778.11
13,079.81
16,671.76
22,092.09
10,032.08
13,228.82
16,210.46
20,739.28
7,391.24
9,903.80
14,130.70
12,402.10
15,480.92
19,151.92
9,814.39
13,116.09
16,965.91
22,430.30
11,741.24
15,714.17
22,830.70
12,764.93
18,629.72
$8,268.50
10,393.61
12,304.92
13,070.73
15,352.64
17,831.50
20,337.58
24,438.79
23,356.80
29,178.82
7,538.96
10,282.17
11,462.65
12,904.87
15,703.80
19,487.54
26,249.02
10,830.30
13,796.38
16,549.96
22,600.05
10,019.13
15,083.11
24,707.02
43,049.07
32,853.71
7,703.53
10,446.74
13,602.01
16,371.14
19,346.29
26,913.77
9,296.07
12,434.50
15,850.23
21,002.33
9,459.34
12,474.67
15,286.55
19,557.51
6,701.88
8,981.19
12,814.17
11,246.25
14,037.40
17,367.61
8,849.02
11,826.77
15,298.21
20,224.85
10,103.35
13,521.67
19,645.62
12,764.93
18,629.72
$7,851.25
9,870.11
11,685.52
12,412.47
14,579.05
16,932.22
19,312.60
23,207.78
22,180.21
27,709.39
6,861.26
9,358.27
10,432.49
11,745.13
14,292.67
17,735.61
23,890.66
9,912.87
12,628.87
15,149.20
20,688.74
8,508.22
12,810.28
20,984.19
36,561.00
27,901.17
6,796.47
9,217.03
12,000.40
14,444.28
17,069.57
23,745.54
8,477.12
11,338.25
14,453.35
19,151.92
8,504.34
11,215.15
13,743.25
17,582.71
6,108.40
8,185.57
11,679.05
10,249.78
12,794.73
15,828.20
7,827.93
10,462.29
13,532.04
17,891.11
9,248.12
12,377.48
17,981.82
11,089.46
16,184.54
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46383
TABLE 5—FY 2009 PAYMENT RATES—Continued
Payment rate
tier 1
CMG
pwalker on PROD1PC71 with RULES2
1201
1202
1203
1301
1302
1303
1401
1402
1403
1404
1501
1502
1503
1504
1601
1602
1603
1701
1702
1703
1704
1801
1802
1803
1901
1902
1903
2001
2002
2003
2004
2101
5001
5101
5102
5103
5104
Payment rate
tier 2
Payment rate
tier 3
Payment rate
no comorbidity
13,371.36
16,889.46
21,223.91
14,231.77
19,164.88
24,801.61
10,370.29
14,376.90
17,594.37
22,842.36
12,443.57
15,934.45
20,266.31
25,300.50
14,375.61
19,408.49
24,992.09
13,546.29
17,852.24
21,466.22
26,921.54
15,794.51
23,840.13
40,742.54
15,007.96
30,332.09
46,576.24
11,428.96
15,385.03
19,736.33
26,386.38
30,666.40
0.00
0.00
0.00
0.00
0.00
12,527.79
15,824.31
19,885.35
12,794.73
17,228.96
22,298.13
9,356.97
12,970.96
15,874.85
20,609.70
10,866.58
13,915.60
17,698.04
22,094.69
11,620.73
15,689.55
20,201.52
11,907.11
15,692.14
18,868.14
23,662.60
12,477.26
18,831.86
32,185.08
12,035.39
24,324.76
37,351.44
9,436.02
12,702.73
16,294.69
21,784.99
30,666.40
0.00
0.00
0.00
0.00
0.00
10,992.27
13,884.50
17,447.95
11,013.00
14,830.43
19,193.39
8,277.57
11,475.60
14,043.88
18,233.20
9,605.77
12,302.33
15,645.49
19,531.59
9,934.90
13,412.83
17,270.42
10,963.76
14,449.47
17,374.09
21,788.88
11,719.22
17,688.97
30,229.72
12,035.39
24,324.76
37,351.44
8,570.42
11,537.80
14,800.63
19,788.16
27,835.08
0.00
0.00
0.00
0.00
0.00
9,771.63
12,342.50
15,509.43
9,910.28
13,345.44
17,271.72
7,343.30
10,179.80
12,459.12
16,175.47
9,119.84
11,679.05
14,853.76
18,542.90
9,158.71
12,365.82
15,921.49
9,613.54
12,670.33
15,234.72
19,105.28
10,051.52
15,171.23
25,927.66
11,379.72
22,999.15
35,315.73
7,681.50
10,340.48
13,265.10
17,734.32
22,616.89
1,912.60
8,789.41
19,996.79
9,182.04
25,379.54
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We received 3 comments on the
proposed standard payment conversion
factor and the proposed unadjusted IRF
prospective payment rates for FY 2009,
which are summarized below.
Comment: One commenter
recommended that CMS use the most
recent available data in computing the
FY 2009 CMG relative weights, because
these have an impact on the FY 2009
IRF prospective payment rates and the
budget neutrality factors used in
computing the FY 2009 standard
payment conversion factor.
Response: We agree that we should
use the most recent available data in
computing the FY 2009 CMG relative
weights. We typically update the data
we use in our analysis each year
between the proposed and final rules in
order to ensure that we are using the
most current available data.
Specifically, in the proposed rule (73 FR
22674 at 22677), we proposed to update
our analysis for this final rule using
more current data. Thus, we updated
our data analysis using FY 2007 IRF
claims data for the final rule, whereas
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we had used FY 2006 IRF claims data
in conducting the analysis for the FY
2009 IRF PPS proposed rule (73 FR
22674 at 22677). As discussed in detail
in section IV of this final rule, we did
not use IRF-PAI data for this final rule
because the CMG information on the FY
2007 IRF claims data incorporated all of
the most recent changes to the IRF
classification system that were
implemented in the FY 2007 IRF PPS
final rule (71 FR 48354). Moreover, we
did not implement any changes to the
IRF classification system in the FY 2008
IRF PPS final rule (72 FR 44284).
The revised final budget neutrality
factors for FY 2009 reflect the updated
FY 2009 IRF labor-related share and the
revised CMG relative weights and
average length of stay values described
above.
Comment: Several commenters
requested that we keep the same
standard payment conversion factor of
$13,034 for FY 2009 that was used for
determining IRF PPS payments in FY
2008, for discharges occurring on or
after April 1, 2008. In effect, we believe
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that these commenters were asking us
not to apply the combined budget
neutrality factor for the wage index and
labor-related share or the budget
neutrality factor for the revisions to the
CMG relative weights to the FY 2008
standard payment conversion factor in
determining the FY 2009 standard
payment conversion factor. Another
commenter asked us to provide a more
extensive explanation of the
methodology that we use to compute the
budget neutrality factors, including any
background studies on the methodology
and calculations for the budget
neutrality factors.
Response: Section 1886(j)(6) of the
Act requires CMS to make any
adjustments or updates to the IRF wage
index in a budget neutral manner. To do
this, we ensure that estimated aggregate
payments to IRFs in the FY are not
greater or less than estimated aggregate
payments would have been without
such adjustments or updates to the wage
index. Thus, in accordance with the
statute and using the same general
methodology that was described and
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finalized in the FY 2004 IRF PPS final
rule (68 FR 45674 at 45689), we are
required to adjust the FY 2008 standard
payment conversion factor of $13,034 by
the combined final budget neutrality
factor for the FY 2009 wage index and
labor related share of 1.0003, which
results in a standard payment amount of
$13,038.
Further, in accordance with the
regulations at § 412.624(d)(4), as
discussed in the FY 2006 IRF PPS final
rule (70 FR 47880 at 47937), we apply
an additional budget neutrality factor to
make the updates to the CMG relative
weights and average length of stay
values budget neutral. The final budget
neutrality factor used to update the
CMG relative weights and average
length of stay values for this final rule
is 0.9939, which results in a standard
payment amount of $12,958. As
discussed above, the budget neutrality
factor used to update the CMG relative
weights and average length of stay
values changed from 0.9969 in the
proposed rule to 0.9939 in this final rule
due to the use of updated FY 2007 IRF
claims data in this final rule. Although
the standard payment conversion factor
for FY 2009 of $12,958 is lower than the
standard payment conversion factor
applicable for discharges occurring on
or after April 1, 2008, of $13,034,
estimated aggregate IRF payments for
FY 2009, excluding outlier payments,
are the same. This is because we
estimate that aggregate IRF payments
would have increased by about $37
million, due to the update to the CMG
relative weights for FY 2009, if we had
not applied the budget-neutrality factor
used to update the CMG relative weights
and average length of stay values.
We have consistently implemented
any revisions to the IRF classification
and weighting factors in a budgetneutral manner, such that estimated
aggregate payments to IRFs remain the
same with and without the revisions.
The methodology for computing the
budget neutrality factor is the same
general methodology that we have
consistently used to ensure that the
changes to the classification and
weighting factors that we implemented
in the FY 2006 IRF PPS final rule (70
FR 47880) and in the FY 2007 IRF PPS
final rule (71 FR 48354) were done in
a budget-neutral manner. (Note that we
did not implement any changes to the
IRF classification or weighting factors in
the FY 2008 IRF PPS final rule (72 FR
44284)). The methodology that we are
using in this final rule to compute the
budget neutrality factor for the updates
to the CMG relative weights is the same
general methodology that we have used
to ensure that updates to the IRF wage
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Jkt 214001
index are implemented in a budgetneutral manner, as discussed above and
as finalized in the FY 2004 IRF PPS
final rule (68 FR 45674 at 45689). The
methodology, as proposed in the FY
2009 IRF PPS proposed rule (73 FR
22674 at 22677) and finalized in this
final rule, applied to the update to the
CMG relative weights for FY 2009
involves the following steps:
Step 1. Calculate the estimated total
amount of IRF PPS payments for FY
2009 (with no changes to the CMG
relative weights).
Step 2. Apply the changes to the CMG
relative weights (as discussed in section
IV of this final rule) to calculate the
estimated total amount of IRF PPS
payments for FY 2009 (with the
changes).
Step 3. Divide the amount calculated
in step 1 ($6,003,947,007) by the
amount calculated in step 2
($6,040,824,839) to determine the factor
(0.9939) that maintains the same total
estimated aggregate payments in FY
2009 with and without the changes to
the CMG relative weights.
Step 4. Apply the final budget
neutrality factor (0.9939) to the FY 2008
IRF PPS standard payment amount after
the application of the budget-neutral
wage adjustment factor.
The FY 2004 IRF PPS final rule (68 FR
45674 at 45689) contains additional
information on the methodology for
computing the budget neutrality factor
for the IRF wage index and labor-related
share, and the FY 2006 IRF PPS final
rule (70 FR 47880, 47937 through
47938) contains additional information
on the methodology for computing the
budget neutrality factor for the updates
to the CMG relative weights and average
length of stay values.
Final Decision: After reviewing the
comments that we received on the
proposed methodology for calculating
the budget neutrality factors for the
wage index and labor-related share and
for the CMG relative weights and
average length of stay values, we are
finalizing the proposed methodology.
We are also finalizing the FY 2009
standard payment conversion factor at
$12,958. This differs from the standard
payment conversion factor of $12,999
that we had proposed in the proposed
rule because of the use of updated FY
2007 IRF claims data for analyzing the
final CMG relative weights and average
length of stay values for this final rule,
as discussed in section IV of this final
rule.
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D. Example of the Methodology for
Adjusting the Federal Prospective
Payment Rates
Table 6 illustrates the methodology
for adjusting the Federal prospective
payments (as described in sections III.A
through III.C of the FY 2009 proposed
rule (73 FR 22674, 22680 through
22685)). The examples below are based
on two hypothetical Medicare
beneficiaries, both classified into CMG
0110 (without comorbidities). The
unadjusted Federal prospective
payment rate for CMG 0110 (without
comorbidities) appears in Table 5 above.
One beneficiary is in Facility A, an
IRF located in rural Spencer County,
Indiana, and another beneficiary is in
Facility B, an IRF located in urban
Harrison County, Indiana. Facility A, a
non-teaching hospital, has a
disproportionate share hospital (DSH)
percentage of 5 percent (which results
in a low-income percentage (LIP)
adjustment of 1.0309), a wage index of
0.8576, and an applicable rural
adjustment of 21.3 percent. Facility B, a
teaching hospital, has a DSH percentage
of 15 percent (which results in a LIP
adjustment of 1.0910), a wage index of
0.9065, and an applicable teaching
status adjustment of 0.109.
To calculate each IRF’s labor and nonlabor portion of the Federal prospective
payment, we begin by taking the
unadjusted Federal prospective
payment rate for CMG 0110 (without
comorbidities) from Table 5 above.
Then, we multiply the estimated laborrelated share (75.464) described in
section V.A of this final rule by the
unadjusted Federal prospective
payment rate. To determine the nonlabor portion of the Federal prospective
payment rate, we subtract the labor
portion of the Federal payment from the
unadjusted Federal prospective
payment.
To compute the wage-adjusted
Federal prospective payment, we
multiply the result of the labor portion
of the Federal payment by the
appropriate wage index found in the
addendum in Tables 1 and 2, which
would result in the wage-adjusted
amount. Next, we compute the wageadjusted Federal payment by adding the
wage-adjusted amount to the non-labor
portion.
Adjusting the Federal prospective
payment by the facility-level
adjustments involves several steps.
First, we take the wage-adjusted Federal
prospective payment and multiply it by
the appropriate rural and LIP
adjustments (if applicable). Second, to
determine the appropriate amount of
additional payment for the teaching
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status adjustment (if applicable), we
multiply the teaching status adjustment
(0.109, in this example) by the wageadjusted and rural-adjusted amount (if
applicable). Finally, we add the
additional teaching status payments (if
applicable) to the wage, rural, and LIPadjusted Federal prospective payment
46385
rates. Table 6 illustrates the components
of the adjusted payment calculation.
TABLE 6—EXAMPLE OF COMPUTING AN IRF FY 2009 FEDERAL PROSPECTIVE PAYMENT
Rural facility A
(Spencer Co.,
IN)
Urban Facility
B (Harrison
Co., IN)
1. Unadjusted Federal Prospective Payment ..........................................................................................................
2. Labor Share .........................................................................................................................................................
$27,709.39
× 0.75464
$27,709.39
× 0.75464
3. Labor Portion of Federal Payment ......................................................................................................................
4. CBSA Based Wage Index (shown in the Addendum, Tables 1 and 2) ..............................................................
= $20,910.61
× 0.8576
= $20,910.61
× 0.9065
5. Wage-Adjusted Amount .......................................................................................................................................
6. Non-labor Amount ...............................................................................................................................................
= $17,932.94
+ $6,798.78
= $18,955.47
+ $6,798.78
7. Wage-Adjusted Federal Payment .......................................................................................................................
8. Rural Adjustment .................................................................................................................................................
= $24,731.72
× 1.213
= $25,754.25
× 1.000
9. Wage- and Rural-Adjusted Federal Payment .....................................................................................................
10. LIP Adjustment ..................................................................................................................................................
= $29,999.57
× 1.0309
= $25,754.25
× 1.0910
11. FY 2009 Wage-, Rural- and LIP-Adjusted Federal Prospective Payment Rate ...............................................
12. FY 2009 Wage- and Rural-Adjusted Federal Prospective Payment ................................................................
13. Teaching Status Adjustment .............................................................................................................................
= $30,926.56
$29,999.57
× 0.000
= $28,097.88
$25,754.25
× 0.109
14. Teaching Status Adjustment Amount ................................................................................................................
15. FY 2009 Wage-, Rural-, and LIP-Adjusted Federal Prospective Payment Rate ..............................................
= $0.00
+ $30,926.56
= $2,807.21
+ $28,097.88
16. Total FY 2009 Adjusted Federal Prospective Payment ....................................................................................
= $30,926.56
= $30,905.10
Steps
Thus, the adjusted payment for
Facility A would be $30,926.56 and the
adjusted payment for Facility B would
be $30,905.10.
VI. Update to Payments for High-Cost
Outliers Under the IRF PPS
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A. Update to the Outlier Threshold
Amount for FY 2009
Section 1886(j)(4) of the Act provides
the Secretary with the authority to make
payments in addition to the basic IRF
prospective payments for cases
incurring extraordinarily high costs. A
case qualifies for an outlier payment if
the estimated cost of the case exceeds
the adjusted outlier threshold. We
calculate the adjusted outlier threshold
by adding the IRF PPS payment for the
case (that is, the CMG payment adjusted
by all of the relevant facility-level
adjustments) and the adjusted threshold
amount (also adjusted by all of the
relevant facility-level adjustments).
Then, we calculate the estimated cost of
a case by multiplying the IRF’s overall
CCR by the Medicare allowable covered
charge. If the estimated cost of the case
is higher than the adjusted outlier
threshold, we make an outlier payment
for the case equal to 80 percent of the
difference between the estimated cost of
the case and the outlier threshold.
In the FY 2002 IRF PPS final rule (66
FR 41316, 41362 through 41363), we
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discussed our rationale for setting the
outlier threshold amount for the IRF
PPS so that estimated outlier payments
would equal 3 percent of total estimated
payments. Subsequently, we updated
the IRF outlier threshold amount in the
FYs 2006, 2007, and 2008 IRF PPS final
rules (70 FR 47880, 70 FR 57166, 71 FR
48354, and 72 FR 44284, respectively) to
maintain estimated outlier payments at
3 percent of total estimated payments.
We also stated that we would continue
to analyze the estimated outlier
payments for subsequent years and
adjust the outlier threshold amount as
appropriate to maintain the 3 percent
target.
As was proposed, for this final rule,
we used updated data for calculating the
high-cost outlier threshold amount.
Specifically, we performed an updated
analysis using FY 2007 claims data
using the same methodology that we
used to set the initial outlier threshold
amount in the FY 2002 IRF PPS final
rule (66 FR 41316, 41362 through
41363), which is also the same
methodology that we used to update the
outlier threshold amounts for FYs 2006,
2007, and 2008. (Note: the methodology
that we use to calculate the appropriate
outlier threshold amount for each FY
requires us to simulate Medicare
payments for that FY, using the most
recent available IRF claims data from a
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previous FY. If the previous FY’s data
that we are using for the analysis does
not contain exactly the same CMGs as
the future FY for which we are
calculating the update to the outlier
threshold, then we cannot rely on the
CMGs from the previous FY’s IRF
claims data and must instead use IRF–
PAI data to assign the appropriate CMG
for each IRF claim.) The CMGs and tiers
in effect for FY 2009 would be slightly
different than those that were in effect
for FY 2006, due to revisions that were
implemented in the FY 2007 IRF PPS
final rule (71 FR 48354, 48360 through
48370). Use of the IRF–PAI data was no
longer necessary when we used the
updated FY 2007 IRF claims data for
this final rule because the CMG
information on the FY 2007 IRF claims
data incorporated all of the changes to
the IRF classification system that were
implemented in the FY 2007 IRF PPS
final rule (71 FR 48354, 48360 through
48370). We did not implement any
changes to the IRF classification system
in the FY 2008 IRF PPS final rule (72
FR 44284).
For FY 2009, based on an analysis of
updated FY 2007 claims data, we
estimate that IRF outlier payments as a
percentage of total estimated payments
would be 4.2 percent without the
change to the outlier threshold amount.
The need to revise the high-cost outlier
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threshold is discussed in detail in
section IV.A of the FY 2009 proposed
rule (73 FR 22674, 22686 through
22687). Generally, we note that the zero
percent IRF increase factor for FYs 2008
and 2009, for discharges occurring on or
after April 1, 2008, implemented by
section 115 of the MMSEA resulted in
lower IRF PPS payments for FYs 2008
and 2009 than would otherwise have
been implemented. In addition, IRF
charges found in the FY 2007 IRF claims
data were higher than those in the FY
2006 IRF claims data, resulting in higher
estimated outlier payments for FY 2009.
Based on the updated analysis of FY
2007 claims data (for the reasons
discussed previously, IRF–PAI data was
not needed in this analysis), we are
updating the outlier threshold amount
to $10,250 to maintain estimated outlier
payments at 3 percent of total estimated
aggregate IRF payments for FY 2009.
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B. Update to the IRF Cost-to-Charge
Ratio Ceilings
In accordance with the methodology
stated in the FY 2004 IRF PPS final rule
(68 FR 45674, 45692 through 45694), we
apply a ceiling to IRFs’ CCRs. Using the
methodology described in that final
rule, as discussed in more detail in
section IV.B of the FY 2009 proposed
rule (73 FR 22674 at 22687), we are
updating the national urban and rural
CCRs for IRFs. As was proposed, the
national average rural and urban CCRs
and our estimate of the national CCR
ceiling are changing in this final rule
based on the analysis of updated data.
We apply the national urban and rural
CCRs in the following situations:
• New IRFs that have not yet
submitted their first Medicare cost
report.
• IRFs whose overall CCR is in excess
of the national CCR ceiling for FY 2009,
as discussed below.
• Other IRFs for which accurate data
to calculate an overall CCR are not
available.
Specifically, for FY 2009, we estimate
a national average CCR of 0.619 for rural
IRFs and 0.490 for urban IRFs based on
the most recent available IRF cost report
data. For this final rule, we have used
FY 2006 IRF cost report data, updated
through March 31, 2008. If, for any IRF,
the FY 2006 cost report was missing or
had an ‘‘as submitted’’ status, we use
data from a previous fiscal year’s report
for that IRF. However, we do not use
cost report data from before FY 2003 for
any IRF. For new IRFs, we use these
national CCRs until the facility’s actual
CCR can be computed using the first
settled cost report (either tentative or
final, whichever is earlier).
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In addition, we estimate the national
CCR ceiling at 1.60 for FY 2009. This
means that, if an individual IRF’s CCR
exceeds this ceiling of 1.60 for FY 2009,
we would replace the IRF’s CCR with
the appropriate national average CCR
(either rural or urban, depending on the
geographic location of the IRF). For a
complete description of the
methodology used to calculate the
national CCR ceiling for this final rule,
see section IV.B of the FY 2009
proposed rule (73 FR 22674 at 22687).
We received seven comments on the
proposed high-cost outlier updates
under the IRF PPS, which are
summarized below.
Comment: Most commenters
supported our proposal to increase the
outlier threshold amount to maintain
estimated outlier payments at 3 percent
of total estimated payments. However,
several other commenters expressed
concerns that the change would mean
that fewer cases would qualify for
outlier payments and that it would
affect IRFs’ ability to provide care to
Medicare beneficiaries. Several
commenters asked that we further
explain the reasons behind the increase
in the IRF outlier threshold amount and
provide proof that we would be paying
more than 3 percent in outliers without
the change. Finally, one commenter said
that the increases in the outlier
threshold amount in recent years appear
excessive and recommended that CMS
look more closely to determine if there
are anomalies in the IRF outlier data or
institutional practices that may be
causing the changes.
Response: Based on our analysis of FY
2007 IRF claims and FY 2006 IRF cost
report data (as previously discussed, we
did not need to use IRF–PAI data in
conjunction with the FY 2007 IRF
claims data), we need to increase the
IRF outlier threshold amount to
maintain estimated outlier payments at
3 percent of total estimated payments
for FY 2009 for the following reasons.
First, as discussed in detail in the FY
2009 IRF PPS proposed rule (73 FR
22674, 22686 through 22687), section
115 of the MMSEA, which amended
section 1886(j)(3)(C) of the Social
Security Act, required the Secretary to
apply a zero percent increase factor for
FYs 2008 and 2009, effective for
discharges occurring on or after April 1,
2008. The effect of this change was to
decrease projected IRF PPS payments.
As a direct result of a zero percent
update, we would exceed our projected
3 percent target for the proportion of
estimated IRF outlier payment to
estimated IRF total payments.
Second, because the average charges
per case in the FY 2007 data are
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significantly higher than the average
charges per case in the FY 2006 data, we
believe that our increase to the outlier
threshold amount for FY 2009 is
warranted. Specifically, higher charges
directly result in more cases being
estimated to qualify for outlier
payments and higher estimated outlier
payments, which in turn lead to higher
estimates of outlier payments as a
percentage of total estimated payments.
In this case, higher charges result in
estimated outlier payments as a
percentage of total estimated payments
in FY 2009 of 4.2 percent, well above
the 3 percent target. To decrease
estimated outlier payments as a
percentage of total estimated payments
from 4.2 percent to 3 percent, we must
increase the outlier threshold.
The higher charges in the FY 2007
may be due to several factors, including
the ‘‘75 percent’’ rule and the IRF
medical review activities, which have
led to declines in the number of IRF
discharges and may have led to
increases in the complexity of IRF cases.
Thus, based on our analysis of updated
data (that is, FY 2007 IRF claims data),
we now project that estimated IRF
outlier payments as a percentage of total
estimated payments for FY 2008
increased from 3.0 percent to 3.7
percent.
Thus, given the recent changes in IRF
aggregate payments resulting from
section 115 of the MMSEA and recent
increases in IRFs’ charges that are being
reflected in the IRF claims data for FY
2007, we believe that it is necessary to
adjust the outlier threshold amount for
FY 2009 to maintain estimated IRF
outlier payments equal to 3 percent of
estimated total payments.
As several of the commenters
suggested, increasing the outlier
threshold amount for FY 2009 would
mean that fewer cases would qualify for
IRF outlier payments. As discussed
above, this is necessary to maintain
estimated IRF outlier payments at 3
percent of estimated total payments.
However, we do not believe that this
will affect IRFs’ ability to provide care
to Medicare beneficiaries because the
IRF outlier policy is designed to reduce
the financial risk to IRFs, which could
be substantial for many smaller IRFs, of
admitting unusually high-cost cases.
The additional IRF outlier payments
reduce the financial losses caused by
treating these patients and, therefore,
reduce the incentives to underserve
these patients. As discussed at length in
the FY 2002 IRF PPS final rule (66 FR
41316 at 41362), we considered various
options for setting the target percentage
of estimated outlier payments as a
percentage of total payments. In that
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final rule, we finalized our proposal to
set an outlier policy of 3 percent of total
estimated payments because we
believed (and continue to believe) that
this option optimizes the extent to
which we protect vulnerable IRFs for
treating unusually high-cost cases,
while still providing adequate payment
for all other IRF cases. If we were to
increase the percentage of total
estimated IRF payments that we paid in
IRF outlier payments, then we would
have to reduce IRF PPS payments for all
other IRF cases in order to implement
this change in a budget neutral manner.
This could negatively affect the
adequacy of IRF PPS payments for
other, non-outlier IRF cases. Thus, we
continue to believe that the 3 percent
outlier policy ensures that all IRF cases,
outlier and non-outlier, continue to be
reimbursed appropriately.
As one of the commenters suggested,
we will continue to analyze IRF outliers
to determine if there are any anomalies
in the IRF outlier data or any
institutional practices which may be
affecting our analysis of IRF outliers. To
the extent that we find any such
anomalies, we would propose to
implement future refinements to the IRF
outlier policies to ensure that IRF
outlier payments continue to fulfill their
intended purpose of reducing the risks
to IRFs of treating unusually high-cost
cases and ensuring access to care for all
patients who require and can benefit
from an IRF level of care.
Comment: One commenter
recommended that we continue to refine
our methodology for calculating the
outlier threshold amount, and that we
use the most accurate CCR data
available.
Response: The CCR data that we use
in our analyses comes directly from the
Medicare cost reports submitted to
Medicare by IRFs and is continually
updated each time a more recent cost
report is tentatively settled. Therefore,
we believe that it is the most accurate
and most recent CCR data available.
However, we agree with the commenter
about the need to continually examine
our methodology and the CCR data to
ensure that we are setting the IRF outlier
threshold at the appropriate level to
maintain estimated outlier payments at
3 percent of total estimated payments.
Comment: One commenter requested
that we conduct an analysis of IRF
outlier payments to ensure that we are
not rewarding IRFs with outlier
payments for the ‘‘wrong’’ reasons, such
as the cost effects of declines in patient
volume. This commenter suggested that
we should either ‘‘hold back’’ outlier
payments from facilities if we find that
the outlier payments were paid for the
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‘‘wrong’’ reasons, or that we should
reduce the outlier pool from 3 percent
to 1.5 percent.
Response: We are continuing to
analyze IRF outlier payments to ensure
that they continue to compensate IRFs
for treating unusually high-cost patients
and promote access to care for patients
who are likely to require unusually
high-cost care. At this time, we do not
have indications to suggest that any IRF
outlier payments are being paid for the
‘‘wrong’’ reasons. Further, we do not
have indications to suggest that the
outlier pool would be better set at 1.5
percent than at 3 percent. However, we
will carefully consider this commenter’s
suggestions, and will consider
proposing additional refinements to the
IRF outlier policies in the future if we
find that such refinements are
necessary.
Comment: Several commenters
requested that CMS provide additional
data and information to the public to
allow the IRF industry and external
researchers to conduct a more thorough
review of CMS’s proposed updates to
the outlier threshold amount and to
verify our estimates of outlier payments
as a percentage of total payments for FY
2009. Specifically, one commenter
asked that we provide information on
actual charge increases and CCR
declines that have been utilized in the
outlier threshold calculation, a
discussion of the data sources and time
periods used in computing the outlier
threshold, an IRF Medpar file (including
total payments, outlier payments, and
actual, estimated, and proposed CMGs),
historical information on IRF facilitylevel payment factors (specifically
CCRs), and actual levels and
percentages of outlier payments. The
commenter also asked that we provide
data on actual outlier payments and the
percentage of outlier payments by FY.
Response: We will carefully consider
all of the commenter’s suggestions in
updating the IRF rate setting files that
we post on the IRF PPS Web site in
conjunction with each IRF PPS
proposed and final rule. These files are
available for download from the IRF
PPS Web site at https://
www.cms.hhs.gov/
InpatientRehabFacPPS/
07_DataFiles.asp#TopOfPage. These
files already contain much of the
facility-level payment data requested by
the commenter, including the CCRs
used to compute the IRF outlier
threshold amount. For this final rule, we
used FY 2007 IRF claims data to
conduct patient-level payment
simulations to estimate the outlier
threshold amount for FY 2009. This data
file contains information that can be
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46387
used to identify individual Medicare
beneficiaries and is therefore not
publicly available. We obtained the
provider-level CCR data used in this
analysis from the Provider-Specific
Files, which contain historical CCR data
and are available for download from the
CMS Web site at https://
www.cms.hhs.gov/
ProspMedicareFeeSvcPmtGen/
03_psf.asp.
The modified Medpar data files that
CMS provides to IPPS hospitals already
contain IRF stay data. However, we have
recently discovered that these files do
not include the CMGs, and we recognize
that there may be other limitations to
the usefulness of these files for
analyzing IRF payments. Based on the
commenters’ requests, we will carefully
consider the usefulness and feasibility
of including additional variables, such
as actual IRF outlier payments and the
percentage of outlier payments, on the
Medpar file in the future to facilitate IRF
analyses.
Comment: One commenter suggested
that CMS utilize the same concepts that
the IPPS uses for modeling charge
increases and cost-to-charge ratio (CCR)
changes in estimating the outlier
threshold amount, as noted in the
methodology implemented for IPPS
hospitals in the FY 2007 IPPS final rule
(71 FR 47870, 48150 through 48151).
Response: We considered proposing
the same methodology described in the
FY 2007 IPPS final rule (71 FR 47870,
48150 through 48151) for projecting cost
and charge growth in estimating the FY
2008 and FY 2009 IRF outlier threshold
amount. However, we discovered that
the accuracy of the projections depends
on the case mix of patients in the
facilities remaining similar from year to
year, as it does in IPPS hospitals. With
the recent phase in of the enforcement
of the 75 percent rule criteria and
increases in IRF medical review
activities, we find evidence of relatively
large changes in the case mix of patients
in IRFs, especially in recent years (FYs
2004 through 2007). In performing our
analysis, we noted that, if we based
future projections of cost and charge
growth on data from years in which
IRFs were experiencing abnormal
fluctuations in case mix, the results
appeared dramatically skewed. Rather
than implementing an outlier threshold
amount for FY 2009 based on such
skewed results, we thought a better
approach would be to wait until we
could further analyze the interactions
between case mix changes and IRF cost
and charge growth.
We are encouraged that IRF case mix
may stabilize in the near future now that
the IRF compliance percentage is set at
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60 percent for FY 2009. However, as
recently as FY 2007, we are still
observing large shifts in IRFs’ patient
populations, and we believe it is
prudent at this time to defer adopting a
methodology for projecting cost and
charge growth in IRFs until the patient
populations have stabilized.
Final Decision: Based on careful
consideration of the comments that we
received on the proposed update to the
outlier threshold amount for FY 2009
and based on updated analysis of the FY
2007 data explained previously in this
section and for the reasons explained in
the proposed rule (73 FR 22674, 22686
through 22687), we are finalizing our
decision to update the outlier threshold
amount for FY 2009. Based on our
proposed policy, the outlier threshold
amount for FY 2009 is $10,250. In
addition, we did not receive any
comments on the IRF cost-to-charge
ratio ceiling. Based on our proposed
policy and the reasons set forth in the
proposed rule (73 FR 22674 at 22687),
we are finalizing the national average
urban CCR at 0.490 and the national
average rural CCR at 0.619. We are also
finalizing our estimate of the IRF
national CCR ceiling at 1.60 for FY
2009.
VII. Revisions to the Regulation Text in
Response to the Medicare, Medicaid,
and SCHIP Extension Act of 2007
Section 115 of the MMSEA amended
section 5005 of the Deficit Reduction
Act of 2005 (DRA, Pub. L. 109–171) to
revise the following elements of the 75
percent rule that are used to classify
IRFs:
• The compliance rate that IRFs must
meet to be excluded from the IPPS and
to be paid under the IRF PPS shall be
no greater than the 60 percent
compliance rate that became effective
for cost reporting periods beginning on
or after July 1, 2006.
• Patient comorbidities that satisfy
the criteria specified in 42 CFR
412.23(b)(2)(i) shall be included in the
calculations used to determine whether
an IRF meets the 60 percent compliance
percentage for cost reporting periods
beginning on or after July 1, 2007.
Although section 115 of the MMSEA
grants the Secretary broad discretion to
implement compliance criteria up to 60
percent, we are setting the compliance
rate at 60 percent, the highest level
possible within current statutory
authority, for the reasons discussed in
detail in the proposed rule (73 FR
22674, 22687 through 22688). Generally,
we are setting the compliance rate at 60
percent because we believe that it
implements the provisions of the statute
with minimal disruption to IRF
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operations, thus allowing us to more
effectively analyze changes in IRF
operations and admissions patterns over
time as well as helping us to ensure that
IRFs predominantly treat patients who
benefit most from this level of care.
Specifically, we proposed the
following revisions to the regulation text
in § 412.23(b). We proposed to remove
the following phrases from the first
sentence of § 412.23(b)(2)(i):
• ‘‘and before July 1, 2007;’’ and
• ‘‘and for cost reporting periods
beginning on or after July 1, 2007 and
before July 1, 2008, the hospital has
served an inpatient population of whom
at least 65 percent,’’
We also proposed to remove
§ 412.23(b)(2)(ii) in its entirety,
redesignate the existing
§ 412.23(b)(2)(iii) to § 412.23(b)(2)(ii),
and revise all references to the
previously numbered § 412.23(b)(2)(iii)
accordingly.
We received 3 comments on the
proposed revisions to the regulation text
in response to section 115 of the
MMSEA, which are summarized below.
Comment: Although several
commenters supported the revisions to
the regulation text in response to section
115 of the MMSEA, one commenter was
concerned that CMS was confusing the
75 percent rule policies, hereinafter
referred to as the 60 percent rule
policies, and the IRF medical necessity
policies.
Response: We agree with the
commenter that the IRF 60 percent rule
policies and the IRF medical necessity
policies are different.
While both policies relate to ensuring
that patients who need the intensive
rehabilitation services provided in IRFs
have access to this level of care, the two
policies serve different functions and
are applied differently.
The Medicare statute excludes
payment for services that ‘‘* * * are not
reasonable and necessary’’ (see section
1862(a) of the Social Security Act). This
applies to all Medicare settings of care,
including IRFs, and it applies to all
Medicare beneficiaries receiving
treatment in those settings. Thus, all IRF
discharges for which providers seek
payment from Medicare must meet the
criteria for establishing the medical
necessity of the treatment, regardless of
whether the patient’s condition is one of
the conditions listed in
§ 412.23(b)(2)(iii), herein redesignated
as § 412.23(b)(2)(ii), or not. CMS has
specifically instructed its contractors to
make medical review determinations
based on reviews of individual medical
records by qualified clinicians, not on
the basis of diagnosis alone. In addition,
we do not believe that the 60 percent
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rule should be used to make individual
medical review claim determinations.
Conversely, the IRF 60 percent rule is
intended to distinguish IRFs from other
inpatient hospital settings of care,
including acute care hospitals and
traditional post-acute care settings (such
as skilled nursing facilities). The 60
percent rule specifies that an IRF’s
patient population must consist of at
least 60 percent of the patients who
need intensive rehabilitation services
for one or more of 13 specified
conditions. The remaining 40 percent of
patients in an IRF may be admitted for
treatment of conditions not included on
the list of qualifying conditions. We
recognize that the list of 13 conditions
does not identify all possible conditions
for which it would generally be
considered reasonable and necessary for
a patient to be treated in an IRF, and
thus we believe that it is appropriate to
allow some percentage of an IRF’s
patient population to be made up of
patients with other conditions.
However, every patient must meet the
medical necessity criteria.
We believe that it is particularly
important to ensure that all patients
being treated in IRFs meet the medical
necessity criteria, so that the data on
which we base IRF PPS payments is as
accurate as possible.
Comment: One commenter expressed
a number of concerns about Medicare’s
policies concerning IRF medical
necessity. This commenter indicated
that IRFs are confused about the
interpretation of the medical necessity
policies. The commenter also expressed
concerns that the data that CMS uses to
analyze and update IRF PPS payment
rates may not be as accurate as it could
be because it may include patients who
do not meet medical necessity
requirements for receiving care in IRFs.
The commenter suggested that this
could lead to inaccuracies in CMS’s rate
setting for IRFs.
Response: We note that we did not
propose anything regarding the IRF
medical necessity policies in the
proposed rule. However, we will
carefully consider the commenter’s
concerns and suggestions and will
consider refinements to the IRF medical
necessity criteria in the future.
Comment: Several commenters
requested that CMS implement changes
to the operational policies used in
determining IRFs’ compliance with the
60 percent rule, to correspond with the
statutory changes to the compliance
percentage and the continued use of
comorbidites. For example, several
commenters asked CMS to revise its
policies to include Medicare Advantage
patients in determining whether at least
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50 percent of an IRF’s patient
population is made up of Medicare
patients. In addition, one commenter
asked that CMS revise its policies to
allow individual IRFs to view the same
IRF–PAI database information that the
fiscal intermediaries use in determining
the IRFs’ compliance using the
presumptive methodology.
Response: We appreciate the
suggestions provided by the
commenters and are considering making
future changes to some of the
operational policies for determining
compliance with the 60 percent rule,
including changes to some of the
policies mentioned by the commenters.
We are currently evaluating whether we
could include Medicare Advantage
patients in determining whether 50
percent of an IRF’s patient population is
made up of Medicare patients, including
our statutory authority for doing so. We
are also currently evaluating whether
modifications to the current system for
collecting and compiling IRF–PAI data
could be made to allow individual IRFs
to view copies of the reports that the
Medicare contractors use in determining
the individual IRF’s compliance using
the presumptive methodology. Our goal
is to continue to ensure that the 60
percent rule compliance determinations
are as transparent and equitable as
possible both for providers and for
Medicare contractors. We are continuing
to work toward this end.
Comment: One commenter suggested
that we remove the phrase ‘‘(b)(2)(ii)’’
from the end of the paragraph in the
regulations at § 412.23(b)(2), as the
original § 412.23(b)(2)(ii) to which the
paragraph referred will no longer exist.
Response: We agree with the
commenter’s suggestion and will make
the suggested revision.
Final Decision: As all of the
commenters supported the proposed
revisions to the regulation text, we are
finalizing our revisions to the regulation
text at § 412.23(b) by removing the
following phrases from the first
sentence of § 412.23(b)(2)(i):
• ‘‘and before July 1, 2007;’’ and
• ‘‘and for cost reporting periods
beginning on or after July 1, 2007 and
before July 1, 2008, the hospital has
served an inpatient population of whom
at least 65 percent,’’
We are also removing
§ 412.23(b)(2)(ii) in its entirety,
redesignating the existing
§ 412.23(b)(2)(iii) to § 412.23(b)(2)(ii),
and revising all references to the
previously numbered § 412.23(b)(2)(iii)
accordingly. In response to a comment,
we are also deleting the phrase ‘‘or
(b)(2)(ii)’’ from the end of the paragraph
in section § 412.23(b)(2).
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VIII. Post Acute Care Payment Reform
In the proposed rule, we discussed
our ongoing examination of possible
steps toward achieving a more seamless
system for the delivery and payment of
post-acute care (PAC) services in
various care settings. These include the
PAC Payment Reform Demonstration
(PAC–PRD) and its standardized patient
assessment tool, the Continuity
Assessment Record and Evaluation
(CARE) tool. In the related area of valuebased purchasing (VBP) initiatives, we
described the IPPS preventable hospitalacquired conditions (HAC) payment
provision, which is designed to ensure
that the occurrence of selected,
preventable conditions during
hospitalization does not have the
unintended effect of generating higher
Medicare payments under the IPPS. We
then discussed the potential application
of this same underlying principle to
other care settings in addition to IPPS
hospitals. For a full and complete
discussion of this issue as it pertains to
the IRF setting, please refer to the FY
2009 IRF PPS proposed rule (73 FR
22674, 22688 through 22689).
We received 12 responses to our
request for comments on the post acute
care payment reform.
Comment: We received several
comments concerning the use of the
CARE tool. While most of these
comments acknowledged that the CARE
tool holds long-term promise in terms of
potentially facilitating the efficient flow
of secure electronic patient information,
they also cautioned that it would be far
too premature at this point in time to
draw any definitive conclusions about
its use, given the very early stage of the
research currently being conducted in
this area.
Response: We agree with the
commenters’ observations about the
CARE tool, both in terms of its
significant future potential and the need
to await the results of ongoing research
before reaching any specific conclusions
about its use. We will continue to
evaluate the CARE tool closely during
the remainder of the current
demonstration, and we plan to keep the
commenters’ concerns in mind as we
proceed with our research in this area.
Comment: A number of commenters
stressed the need for external research
in the area of PAC payment reform, as
well as the importance of obtaining
input from the stakeholder community.
Response: We agree with the
commenters regarding the value of
obtaining stakeholder input, and believe
that this is, in fact, crucial to the success
of our PAC payment reform efforts. We
also recognize the importance of
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obtaining the benefit of findings from
research that is currently underway. We
note that our own activities in this
regard primarily involve applied
research through our demonstration
projects and internal analysis of changes
in program policy. However, while our
limited resources in this area preclude
us from sponsoring any external
research projects on PAC payment
reform, we strongly favor such activity
and encourage interested parties to
engage in it.
Comment: We received a number of
comments regarding the HAC payment
provision under the IPPS, and the
possible adoption of a similar approach
in care settings other than IPPS
hospitals. The commenters urged us to
conduct a thorough evaluation of the
HAC policy’s implementation under the
IPPS to determine its actual impact and
efficacy prior to considering whether to
adopt this type of approach in other care
settings. Some also questioned the legal
authority under existing Medicare law
to expand the HAC payment provision
beyond the IPPS hospital setting. Others
raised concerns about the specific
implications of applying this type of
policy to the IRF setting. They cited
‘‘falls’’ as an example of something that
might be less appropriately
characterized as ‘‘never events’’ in the
IRF setting than in the acute care
hospital setting. They also argued that it
would be unfair to penalize an IRF
financially for a condition that actually
developed during the preceding hospital
stay but was not detected until after
transfer to the IRF. In addition, they
indicated that it might be difficult to
differentiate a preventable healthcareacquired complication from a normal,
unavoidable aspect of a terminal illness.
Response: We appreciate the
commenters’ thoughtful input about
application of the principal embodied in
the IPPS HAC payment provision to the
IRF setting. While we acknowledge that
‘‘falls’’ are among the selected HACs in
the IPPS acute care setting that
potentially have significant implications
for the IRF setting, we agree that these
and other conditions may have different
implications in the IRF setting. We agree
with the commenters that it would be
unfair to penalize an IRF financially for
a condition that developed in another
care setting. We note that the IPPS HAC
payment provision uses Present on
Admission (POA) indicator data to
exclude from payment consequences
conditions that develop outside of the
IPPS acute care stay, and a similar
mechanism would be needed to apply
this type of payment provision to the
IRF setting. Regarding the commenters’
concerns about the difficulty in
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differentiating a preventable healthcareacquired complication from a normal,
unavoidable aspect of a terminal illness,
we would expect to work closely with
stakeholders to determine which
conditions could reasonably be
prevented through the application of
evidence-based guidelines. Finally, with
regard to the comments that questioned
the existing legal authority for
expanding the HAC payment provision
beyond the IPPS hospital setting, we
note that in this final rule, we are not
establishing any new Medicare policies
in this area. However, we will keep the
commenters’ concerns in mind as our
implementation of value-based
purchasing for all Medicare payment
systems proceeds, and we look forward
to working with stakeholders in
continuing to explore possible ways to
reduce the occurrence of these
preventable conditions in various care
settings.
IX. Miscellaneous Comments
Comment: One commenter
recommended that CMS update the IRF
facility-level adjustments, including the
rural adjustment, the low-income
percentage adjustment, and the teaching
status adjustment, as these adjustments
were last updated in FY 2006 based on
analysis of FY 2003 data. This
commenter also suggested a number of
methodological changes to the way that
CMS computes the facility-level
adjustments, including standardizing
cost-per-case by outlier payments and
computing three-year moving averages
of the adjustments to promote added
stability and predictability in the
payment system.
Response: We note that we did not
propose any refinements to the IRF
facility-level adjustment for FY 2009.
However, we are in the process of
analyzing the data to determine whether
future updates to the IRF facility-level
adjustments are needed. At the same
time, we are also analyzing the
commenter’s suggested revisions to the
methodology for computing these
adjustments to determine whether these
revisions would improve the precision
of our estimates of the appropriate
facility-level adjustment parameters. We
will consider proposing to update the
IRF facility-level adjustments in future
rules if our analysis indicates that such
updates are necessary to ensure that IRF
PPS payments continue to reflect the
costs of caring for IRF patients
appropriately.
Comment: One commenter
recommended that CMS re-examine the
weights used to compute the weighted
motor score for classifying IRF patients.
The weights that are currently being
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used to compute patients’ motor scores
were finalized in the FY 2006 IRF PPS
final rule (70 FR 47880 at 47900) and
were based on FY 2003 data. The
commenter expressed concerns that the
appropriate weights may change over
time and may need to be updated using
more recent data.
Response: We did not propose any
changes to the weighted motor score in
the proposed rule. However, we will
consider the commenter’s suggestions
for future updates to the weighted motor
score methodology.
Comment: Several commenters
expressed interest in assisting CMS in
the development of the IRF Report to
Congress that was mandated in section
115 of the MMSEA.
Response: We appreciate the
commenters’ interest in this important
project and, as required by statute, we
will consult with interested parties and
stakeholders in developing this report.
Comment: Several commenters noted
that we reported IRF spending estimates
of $6.4 billion for FY 2008 in the
proposed rule (73 FR 22674 at 22686)
and IRF spending projections of $5.6
billion for FY 2009 in the press release
that was issued in conjunction with the
proposed rule. We believe that these
commenters mistakenly interpreted
these spending estimates to mean that a
12.5 percent decrease in IRF PPS
payments is estimated to occur between
FY 2008 and FY 2009.
Response: The IRF spending estimate
of $6.4 billion for FY 2008 that was
reported in the proposed rule (73 FR
22674 at 22686) did not account for any
changes in IRF utilization that might
occur between FYs 2006 and 2008. It
was based on an analysis of simulated
IRF payments using IRF claims data
from FY 2006 (that is, the number and
types of patients that were being treated
in IRFs in FY 2006) and the policies that
were being proposed for FY 2009 with
IRF utilization held constant. The $6.4
billion spending estimate should not be
compared with the $5.6 billion IRF
spending projection developed by the
Office of the Actuary for FY 2008,
which accounts for expected changes in
IRF utilization between FYs 2006 and
2008. The Office of the Actuary projects
that total IRF spending for both FY 2008
and FY 2009 will be $5.6 billion under
both the FY 2009 IRF PPS proposed and
final rules. Thus, for this final rule, we
estimate only a $40 million decrease in
IRF PPS spending between FY 2008 and
FY 2009, which is equal to only 0.7
percent of total estimated IRF PPS
payments. We note that this is different
than the $20 million decrease in IRF
PPS spending that we had estimated for
the proposed rule due to the use of
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updated data (that is, FY 2007 IRF
claims data). The estimated $40 million
decrease for this final rule is entirely
due to the adjustment to the outlier
threshold amount for FY 2009 to set
estimated IRF outlier payments at 3
percent of total estimated payments, as
discussed in detail in section XII of this
final rule.
X. Provisions of the Final Rule
In this final rule, we are adopting the
provisions as set forth in the FY 2009
IRF PPS proposed rule (73 FR 22674),
except as noted elsewhere in the
preamble. Specifically:
• We will update the pre-reclassified
and pre-floor wage indexes based on the
CBSA changes published in the most
recent OMB bulletins that apply to the
hospital wage data used to determine
the current IRF PPS wage index, as
discussed in section V.B of this final
rule.
• We will update the FY 2009 IRF
PPS relative weights and average length
of stay values using the most current
and complete Medicare claims and cost
report data, as discussed in section IV
of this final rule.
• We will update the FY 2009 IRF
PPS payment rates by the wage index
and labor related share in a budget
neutral manner, as discussed in section
V.A and B of this final rule.
• We will update the outlier
threshold amount for FY 2009, as
discussed in section VI.A of this final
rule.
• We will update the cost-to-charge
ratio ceiling and the national average
urban and rural cost-to-charge ratios for
purposes of determining outlier
payments under the IRF PPS, as
discussed in section VI.B of this final
rule.
• With respect to § 412.23, we will
revise the regulation text in paragraph
(b)(2) and (b)(2)(i) and remove
paragraph (b)(2)(ii) to reflect section 115
of the MMSEA, as discussed in section
VII of this final rule.
XI. Collection of Information
Requirements
This document does not impose
information collection and
recordkeeping requirements.
Consequently, it need not be reviewed
by the Office of Management and
Budget under the authority of the
Paperwork Reduction Act of 1995.
XII. Regulatory Impact Statement
We have examined the impact of this
final rule as required by Executive
Order 12866 (September 1993,
Regulatory Planning and Review), the
Regulatory Flexibility Act (RFA,
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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), Executive
Order 13132 on Federalism, and the
Congressional Review Act (5 U.S.C.
804(2)).
Executive Order 12866, as amended,
directs agencies to assess all costs and
benefits of available regulatory
alternatives and, if regulation is
necessary, to select regulatory
approaches that maximize net benefits
(including potential economic,
environmental, public health and safety
effects, distributive impacts, and
equity). A regulatory impact analysis
(RIA) must be prepared for major rules
with economically significant effects
($100 million or more in any one year).
This final rule does not reach the $100
million economic threshold and thus is
not considered a major rule. We
estimate that the total impact of the
changes in this final rule would be a
decrease of approximately $40 million
or 0.7 percent of total IRF PPS payments
(this reflects a $40 million decrease due
to the update to the outlier threshold
amount to decrease estimated outlier
payments from approximately 3.7
percent in FY 2008 to 3 percent in FY
2009).
The RFA requires agencies to analyze
options for regulatory relief of small
entities. For purposes of the RFA, small
entities include small businesses,
nonprofit organizations, and small
governmental jurisdictions. Most IRFs
and most other providers and suppliers
are small entities, either by nonprofit
status or by having revenues of $6.5
million to $31.5 million in any one year.
(For details, see the Small Business
Administration’s final rule that set forth
size standards for health care industries,
at 65 FR 69432, November 17, 2000.)
Because we lack data on individual
hospital receipts, we cannot determine
the number of small proprietary IRFs or
the proportion of IRFs’ revenue that is
derived from Medicare payments.
Therefore, we assume that all IRFs (an
approximate total of 1,200 IRFs, of
which approximately 60 percent are
nonprofit facilities) are considered small
entities and that Medicare payment
constitutes the majority of their
revenues. The Department of Health and
Human Services generally uses a
revenue impact of 3 to 5 percent as a
significance threshold under the RFA.
Medicare fiscal intermediaries and
carriers are not considered to be small
entities. Individuals and States are not
included in the definition of a small
entity. The Secretary has determined
that this final rule (which we estimate
will result in a decrease in total
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estimated payments to IRFs of 0.7
percent) would not have a significant
economic impact on a substantial
number of small entities and therefore
an analysis as outlined by the RFA was
not prepared.
In addition, section 1102(b) of the Act
requires us to prepare a regulatory
impact analysis if a rule may have a
significant impact on the operations of
a substantial number of small rural
hospitals. This analysis must conform to
the provisions of section 604 of the
RFA. For purposes of section 1102(b) of
the Act, we define a small rural hospital
as a hospital that is located outside of
a Metropolitan Statistical Area and has
fewer than 100 beds. The Secretary has
determined that this final rule would
not have a significant impact on the
operations of a substantial number of
small rural hospitals and therefore an
analysis for section 1102(b) of the Act
was not prepared.
Section 202 of the Unfunded
Mandates Reform Act of 1995 (UMRA)
also requires that agencies assess
anticipated costs and benefits before
issuing any rule whose mandates
require spending in any one year of
$100 million in 1995 dollars, updated
annually for inflation. That threshold
level is currently approximately $130
million. This final rule would not
mandate any cost requirements on State,
local, or tribal governments in the
aggregate, or by the private sector, of
$130 million.
Executive Order 13132 establishes
certain requirements that an agency
must meet when it promulgates a
proposed rule (and subsequent final
rule) that imposes substantial direct
requirement costs on State and local
governments, preempts State law, or
otherwise has Federalism implications.
As stated above, this final rule would
not have a substantial effect on State
and local governments.
We received one comment on the
regulatory impact statement included in
the proposed rule, which is summarized
below.
Comment: One commenter expressed
concern that the regulatory impact
information provided in the proposed
rule was not sufficient to calculate the
projected impact to individual
providers, and that data on FY 2007
actual payments, FY 2008 estimated
payments, and FY 2009 proposed
payments would be required to fully
estimate the effects on individual IRFs.
The commenter requested that CMS
make information available to allow
interested parties to recreate CMS’s
impact table and to make projections on
a facility-specific basis.
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46391
Response: As discussed above, we did
not prepare a regulatory impact analysis
for this final rule (or for the proposed
rule) because this final rule does not
reach the $100 million economic
threshold and thus is not considered a
major rule. However, we provided an
IRF rate setting file in conjunction with
the proposed rule to allow interested
parties to calculate the payment effects
of the proposed policies for individual
IRFs. In addition, we will carefully
consider all of the commenter’s
suggestions in updating the final FY
2009 IRF rate setting file that will be
posted on the IRF PPS Web site in
conjunction with this final rule. This
file will be available for download from
the IRF PPS Web site soon after
publication of this final rule at https://
www.cms.hhs.gov/
InpatientRehabFacPPS/
07_DataFiles.asp#TopOfPage. The IRF
rate setting files posted in conjunction
with each proposed and final rule
already contain much of the facilitylevel payment data needed to allow
interested parties to recreate CMS’s
analysis and to make projections on a
facility-specific basis.
In accordance with the provisions of
Executive Order 12866, this regulation
was reviewed by the Office of
Management and Budget.
List of Subjects in 42 CFR Part 412
Administrative practice and
procedure, Health facilities, Medicare,
Puerto Rico, Reporting and
recordkeeping requirements.
I For the reasons set forth in the
preamble, the Centers for Medicare &
Medicaid Services amends 42 CFR
chapter IV as follows:
PART 412—PROSPECTIVE PAYMENT
SYSTEMS FOR INPATIENT HOSPITAL
SERVICES
1. The authority citation for part 412
continues to read as follows:
I
Authority: Sections 1102 and 1871 of the
Social Security Act (42 U.S.C. 1302 and
1395hh).
Subpart B—Hospital Services Subject
to and Excluded From the Prospective
Payment Systems for Inpatient
Operating Costs and Inpatient
Capital—Related Costs
2. Section 412.23 is amended by—
A. Revising introductory text of
paragraph (b)(2).
I B. Revising introductory text of
paragraph (b)(2)(i).
I C. Revising paragraphs (b)(2)(i)(A) and
(B).
I D. Removing paragraph (b)(2)(ii).
I
I
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E. Redesignating paragraph (b)(2)(iii)
as (b)(2)(ii).
The revision reads as follows:
I
§ 412.23 Excluded hospitals:
Classifications.
*
*
*
*
*
(b) * * *
(2) Except in the case of a newly
participating hospital seeking
classification under this paragraph as a
rehabilitation hospital for its first 12month cost reporting period, as
described in paragraph (b)(8) of this
section, a hospital must show that
during its most recent, consecutive, and
appropriate 12-month time period (as
defined by CMS or the fiscal
intermediary), it served an inpatient
population that meets the criteria under
paragraph (b)(2)(i) of this section.
(i) For cost reporting periods
beginning on or after July 1, 2004 and
before July 1, 2005, the hospital has
served an inpatient population of whom
at least 50 percent, and for cost
reporting periods beginning on or after
July 1, 2005, the hospital has served an
inpatient population of whom at least
60 percent required intensive
rehabilitation services for treatment of
one or more of the conditions specified
at paragraph (b)(2)(ii) of this section. A
patient with a comorbidity, as defined at
§ 412.602, may be included in the
inpatient population that counts toward
the required applicable percentage if—
(A) The patient is admitted for
inpatient rehabilitation for a condition
that is not one of the conditions
specified in paragraph (b)(2)(ii) of this
section;
(B) The patient has a comorbidity that
falls in one of the conditions specified
in paragraph (b)(2)(ii) of this section;
and
*
*
*
*
*
(Catalog of Federal Domestic Assistance
Program No. 93.773, Medicare—Hospital
Insurance; and Program No. 93.774,
Medicare—Supplemental Medical Insurance
Program).
Dated: July 18, 2008.
Kerry Weems,
Acting Administrator, Centers for Medicare
& Medicaid Services.
Approved: July 25, 2008.
Michael O. Leavitt,
Secretary.
The following addendum will not
appear in the Code of Federal
Regulations.
Addendum
This addendum contains the tables referred
to throughout the preamble of this final rule.
The tables presented below are as follows:
Table 1.—Inpatient Rehabilitation Facility
Wage Index for Urban Areas for Discharges
Occurring from October 1, 2008 through
September 30, 2009
Table 2.—Inpatient Rehabilitation Facility
Wage Index for Rural Areas for Discharges
Occurring from October 1, 2008 through
September 30, 2009
TABLE 1—INPATIENT REHABILITATION FACILITY WAGE INDEX FOR URBAN AREAS FOR DISCHARGES OCCURRING FROM
OCTOBER 1, 2008 THROUGH SEPTEMBER 30, 2009
CBSA code
Urban area (constituent counties)
10180 .......
Abilene, TX ........................................................................................................................................................................
Callahan County, TX
Jones County, TX
Taylor County, TX
´
Aguadilla-Isabela-San Sebastian, PR ...............................................................................................................................
Aguada Municipio, PR
Aguadilla Municipio, PR
˜
Anasco Municipio, PR
Isabela Municipio, PR
Lares Municipio, PR
Moca Municipio, PR
´
Rincon Municipio, PR
´
San Sebastian Municipio, PR
Akron, OH .........................................................................................................................................................................
Portage County, OH
Summit County, OH
Albany, GA ........................................................................................................................................................................
Baker County, GA
Dougherty County, GA
Lee County, GA
Terrell County, GA
Worth County, GA
Albany-Schenectady-Troy, NY ..........................................................................................................................................
Albany County, NY
Rensselaer County, NY
Saratoga County, NY
Schenectady County, NY
Schoharie County, NY
Albuquerque, NM ..............................................................................................................................................................
Bernalillo County, NM
Sandoval County, NM
Torrance County, NM
Valencia County, NM
Alexandria, LA ...................................................................................................................................................................
Grant Parish, LA
Rapides Parish, LA
Allentown-Bethlehem-Easton, PA-NJ ...............................................................................................................................
Warren County, NJ
Carbon County, PA
Lehigh County, PA
Northampton County, PA
Altoona, PA .......................................................................................................................................................................
10380 .......
10420 .......
10500 .......
10580 .......
10740 .......
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10780 .......
10900 .......
11020 .......
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Wage index
08AUR2
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0.3448
0.8794
0.8514
0.8588
0.9554
0.7979
0.9865
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TABLE 1—INPATIENT REHABILITATION FACILITY WAGE INDEX FOR URBAN AREAS FOR DISCHARGES OCCURRING FROM
OCTOBER 1, 2008 THROUGH SEPTEMBER 30, 2009—Continued
CBSA code
11100 .......
11180 .......
11260 .......
11300 .......
11340 .......
11460 .......
11500 .......
11540 .......
11700 .......
12020 .......
12060 .......
12100 .......
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12220 .......
12260 .......
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Urban area (constituent counties)
Wage index
Blair County, PA
Amarillo, TX .......................................................................................................................................................................
Armstrong County, TX
Carson County, TX
Potter County, TX
Randall County, TX
Ames, IA ............................................................................................................................................................................
Story County, IA
Anchorage, AK ..................................................................................................................................................................
Anchorage Municipality, AK
Matanuska-Susitna Borough, AK
Anderson, IN .....................................................................................................................................................................
Madison County, IN
Anderson, SC ....................................................................................................................................................................
Anderson County, SC
Ann Arbor, MI ....................................................................................................................................................................
Washtenaw County, MI
Anniston-Oxford, AL ..........................................................................................................................................................
Calhoun County, AL
Appleton, WI ......................................................................................................................................................................
Calumet County, WI
Outagamie County, WI
Asheville, NC .....................................................................................................................................................................
Buncombe County, NC
Haywood County, NC
Henderson County, NC
Madison County, NC
Athens-Clarke County, GA ................................................................................................................................................
Clarke County, GA
Madison County, GA
Oconee County, GA
Oglethorpe County, GA
Atlanta-Sandy Springs-Marietta, GA .................................................................................................................................
Barrow County, GA
Bartow County, GA
Butts County, GA
Carroll County, GA
Cherokee County, GA
Clayton County, GA
Cobb County, GA
Coweta County, GA
Dawson County, GA
DeKalb County, GA
Douglas County, GA
Fayette County, GA
Forsyth County, GA
Fulton County, GA
Gwinnett County, GA
Haralson County, GA
Heard County, GA
Henry County, GA
Jasper County, GA
Lamar County, GA
Meriwether County, GA
Newton County, GA
Paulding County, GA
Pickens County, GA
Pike County, GA
Rockdale County, GA
Spalding County, GA
Walton County, GA
Atlantic City, NJ .................................................................................................................................................................
Atlantic County, NJ
Auburn-Opelika, AL ...........................................................................................................................................................
Lee County, AL
Augusta-Richmond County, GA-SC ..................................................................................................................................
Burke County, GA
Columbia County, GA
McDuffie County, GA
Richmond County, GA
Aiken County, SC
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0.7926
0.9598
0.9185
1.0517
0.9828
1.2198
0.8090
0.9645
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TABLE 1—INPATIENT REHABILITATION FACILITY WAGE INDEX FOR URBAN AREAS FOR DISCHARGES OCCURRING FROM
OCTOBER 1, 2008 THROUGH SEPTEMBER 30, 2009—Continued
CBSA code
12420 .......
12540 .......
12580 .......
12620 .......
12700 .......
12940 .......
12980 .......
13020 .......
13140 .......
13380 .......
13460 .......
13644 .......
13740 .......
13780 .......
13820 .......
13900 .......
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14020 .......
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Wage index
Edgefield County, SC
Austin-Round Rock, TX ....................................................................................................................................................
Bastrop County, TX
Caldwell County, TX
Hays County, TX
Travis County, TX
Williamson County, TX
Bakersfield, CA .................................................................................................................................................................
Kern County, CA
Baltimore-Towson, MD ......................................................................................................................................................
Anne Arundel County, MD
Baltimore County, MD
Carroll County, MD
Harford County, MD
Howard County, MD
Queen Anne’s County, MD
Baltimore City, MD
Bangor, ME .......................................................................................................................................................................
Penobscot County, ME
Barnstable Town, MA ........................................................................................................................................................
Barnstable County, MA
Baton Rouge, LA ...............................................................................................................................................................
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
Battle Creek, MI ................................................................................................................................................................
Calhoun County, MI
Bay City, MI .......................................................................................................................................................................
Bay County, MI
Beaumont-Port Arthur, TX ................................................................................................................................................
Hardin County, TX
Jefferson County, TX
Orange County, TX
Bellingham, WA .................................................................................................................................................................
Whatcom County, WA
Bend, OR ..........................................................................................................................................................................
Deschutes County, OR
Bethesda-Gaithersburg-Frederick, MD .............................................................................................................................
Frederick County, MD
Montgomery County, MD
Billings, MT ........................................................................................................................................................................
Carbon County, MT
Yellowstone County, MT
Binghamton, NY ................................................................................................................................................................
Broome County, NY
Tioga County, NY
Birmingham-Hoover, AL ....................................................................................................................................................
Bibb County, AL
Blount County, AL
Chilton County, AL
Jefferson County, AL
St. Clair County, AL
Shelby County, AL
Walker County, AL
Bismarck, ND ....................................................................................................................................................................
Burleigh County, ND
Morton County, ND
Blacksburg-Christiansburg-Radford, VA ...........................................................................................................................
Giles County, VA
Montgomery County, VA
Pulaski County, VA
Radford City, VA
Bloomington, IN .................................................................................................................................................................
Greene County, IN
Monroe County, IN
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1.0179
0.8897
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0.8949
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0.7225
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TABLE 1—INPATIENT REHABILITATION FACILITY WAGE INDEX FOR URBAN AREAS FOR DISCHARGES OCCURRING FROM
OCTOBER 1, 2008 THROUGH SEPTEMBER 30, 2009—Continued
CBSA code
14060 .......
14260 .......
14484 .......
14500 .......
14540 .......
14740 .......
14860 .......
15180 .......
15260 .......
15380 .......
15500 .......
15540 .......
15764 .......
15804 .......
15940 .......
15980 .......
16180 .......
16220 .......
16300 .......
16580 .......
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16700 .......
16740 .......
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Wage index
Owen County, IN
Bloomington-Normal, IL ....................................................................................................................................................
McLean County, IL
Boise City-Nampa, ID .......................................................................................................................................................
Ada County, ID
Boise County, ID
Canyon County, ID
Gem County, ID
Owyhee County, ID
Boston-Quincy, MA ...........................................................................................................................................................
Norfolk County, MA
Plymouth County, MA
Suffolk County, MA
Boulder, CO ......................................................................................................................................................................
Boulder County, CO
Bowling Green, KY ............................................................................................................................................................
Edmonson County, KY
Warren County, KY
Bremerton-Silverdale, WA .................................................................................................................................................
Kitsap County, WA
Bridgeport-Stamford-Norwalk, CT .....................................................................................................................................
Fairfield County, CT
Brownsville-Harlingen, TX .................................................................................................................................................
Cameron County, TX
Brunswick, GA ...................................................................................................................................................................
Brantley County, GA
Glynn County, GA
McIntosh County, GA
Buffalo-Niagara Falls, NY .................................................................................................................................................
Erie County, NY
Niagara County, NY
Burlington, NC ...................................................................................................................................................................
Alamance County, NC
Burlington-South Burlington, VT .......................................................................................................................................
Chittenden County, VT
Franklin County, VT
Grand Isle County, VT
Cambridge-Newton-Framingham, MA ...............................................................................................................................
Middlesex County, MA
Camden, NJ ......................................................................................................................................................................
Burlington County, NJ
Camden County, NJ
Gloucester County, NJ
Canton-Massillon, OH .......................................................................................................................................................
Carroll County, OH
Stark County, OH
Cape Coral-Fort Myers, FL ...............................................................................................................................................
Lee County, FL
Carson City, NV ................................................................................................................................................................
Carson City, NV
Casper, WY .......................................................................................................................................................................
Natrona County, WY
Cedar Rapids, IA ...............................................................................................................................................................
Benton County, IA
Jones County, IA
Linn County, IA
Champaign-Urbana, IL ......................................................................................................................................................
Champaign County, IL
Ford County, IL
Piatt County, IL
Charleston, WV .................................................................................................................................................................
Boone County, WV
Clay County, WV
Kanawha County, WV
Lincoln County, WV
Putnam County, WV
Charleston-North Charleston, SC .....................................................................................................................................
Berkeley County, SC
Charleston County, SC
Dorchester County, SC
Charlotte-Gastonia-Concord, NC-SC ................................................................................................................................
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1.0904
1.2735
0.8914
0.9475
0.9568
0.8747
0.9660
1.1215
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0.9396
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0.9385
0.8852
0.9392
0.8289
0.9124
0.9520
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TABLE 1—INPATIENT REHABILITATION FACILITY WAGE INDEX FOR URBAN AREAS FOR DISCHARGES OCCURRING FROM
OCTOBER 1, 2008 THROUGH SEPTEMBER 30, 2009—Continued
CBSA code
16820 .......
16860 .......
16940 .......
16974 .......
17020 .......
17140 .......
17300 .......
17420 .......
17460 .......
17660 .......
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17820 .......
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Urban area (constituent counties)
Wage index
Anson County, NC
Cabarrus County, NC
Gaston County, NC
Mecklenburg County, NC
Union County, NC
York County, SC
Charlottesville, VA .............................................................................................................................................................
Albemarle County, VA
Fluvanna County, VA
Greene County, VA
Nelson County, VA
Charlottesville City, VA
Chattanooga, TN-GA ........................................................................................................................................................
Catoosa County, GA
Dade County, GA
Walker County, GA
Hamilton County, TN
Marion County, TN
Sequatchie County, TN
Cheyenne, WY ..................................................................................................................................................................
Laramie County, WY
Chicago-Naperville-Joliet, IL .............................................................................................................................................
Cook County, IL
DeKalb County, IL
DuPage County, IL
Grundy County, IL
Kane County, IL
Kendall County, IL
McHenry County, IL
Will County, IL
Chico, CA ..........................................................................................................................................................................
Butte County, CA
Cincinnati-Middletown, OH-KY-IN .....................................................................................................................................
Dearborn County, IN
Franklin County, IN
Ohio County, IN
Boone County, KY
Bracken County, KY
Campbell County, KY
Gallatin County, KY
Grant County, KY
Kenton County, KY
Pendleton County, KY
Brown County, OH
Butler County, OH
Clermont County, OH
Hamilton County, OH
Warren County, OH
Clarksville, TN-KY .............................................................................................................................................................
Christian County, KY
Trigg County, KY
Montgomery County, TN
Stewart County, TN
Cleveland, TN ...................................................................................................................................................................
Bradley County, TN
Polk County, TN
Cleveland-Elyria-Mentor, OH ............................................................................................................................................
Cuyahoga County, OH
Geauga County, OH
Lake County, OH
Lorain County, OH
Medina County, OH
Coeur d’Alene, ID ..............................................................................................................................................................
Kootenai County, ID
College Station-Bryan, TX ................................................................................................................................................
Brazos County, TX
Burleson County, TX
Robertson County, TX
Colorado Springs, CO .......................................................................................................................................................
El Paso County, CO
Teller County, CO
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TABLE 1—INPATIENT REHABILITATION FACILITY WAGE INDEX FOR URBAN AREAS FOR DISCHARGES OCCURRING FROM
OCTOBER 1, 2008 THROUGH SEPTEMBER 30, 2009—Continued
CBSA code
Urban area (constituent counties)
17860 .......
Columbia, MO ...................................................................................................................................................................
Boone County, MO
Howard County, MO
Columbia, SC ....................................................................................................................................................................
Calhoun County, SC
Fairfield County, SC
Kershaw County, SC
Lexington County, SC
Richland County, SC
Saluda County, SC
Columbus, GA-AL .............................................................................................................................................................
Russell County, AL
Chattahoochee County, GA
Harris County, GA
Marion County, GA
Muscogee County, GA
Columbus, IN ....................................................................................................................................................................
Bartholomew County, IN
Columbus, OH ...................................................................................................................................................................
Delaware County, OH
Fairfield County, OH
Franklin County, OH
Licking County, OH
Madison County, OH
Morrow County, OH
Pickaway County, OH
Union County, OH
Corpus Christi, TX .............................................................................................................................................................
Aransas County, TX
Nueces County, TX
San Patricio County, TX
Corvallis, OR .....................................................................................................................................................................
Benton County, OR
Cumberland, MD-WV ........................................................................................................................................................
Allegany County, MD
Mineral County, WV
Dallas-Plano-Irving, TX .....................................................................................................................................................
Collin County, TX
Dallas County, TX
Delta County, TX
Denton County, TX
Ellis County, TX
Hunt County, TX
Kaufman County, TX
Rockwall County, TX
Dalton, GA .........................................................................................................................................................................
Murray County, GA
Whitfield County, GA
Danville, IL ........................................................................................................................................................................
Vermilion County, IL
Danville, VA .......................................................................................................................................................................
Pittsylvania County, VA
Danville City, VA
Davenport-Moline-Rock Island, IA-IL ................................................................................................................................
Henry County, IL
Mercer County, IL
Rock Island County, IL
Scott County, IA
Dayton, OH .......................................................................................................................................................................
Greene County, OH
Miami County, OH
Montgomery County, OH
Preble County, OH
Decatur, AL .......................................................................................................................................................................
Lawrence County, AL
Morgan County, AL
Decatur, IL .........................................................................................................................................................................
Macon County, IL
Deltona-Daytona Beach-Ormond Beach, FL ....................................................................................................................
Volusia County, FL
Denver-Aurora, CO ...........................................................................................................................................................
17900 .......
17980 .......
18020 .......
18140 .......
18580 .......
18700 .......
19060 .......
19124 .......
19140 .......
19180 .......
19260 .......
19340 .......
19380 .......
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19460 .......
19500 .......
19660 .......
19740 .......
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08AUR2
0.8658
0.8800
0.8729
0.9537
1.0085
0.8588
1.0959
0.8294
0.9915
0.8760
0.8957
0.8240
0.8830
0.9190
0.7885
0.8074
0.9031
1.0718
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TABLE 1—INPATIENT REHABILITATION FACILITY WAGE INDEX FOR URBAN AREAS FOR DISCHARGES OCCURRING FROM
OCTOBER 1, 2008 THROUGH SEPTEMBER 30, 2009—Continued
CBSA code
19780 .......
19804 .......
20020 .......
20100 .......
20220 .......
20260 .......
20500 .......
20740 .......
20764 .......
20940 .......
21060 .......
21140 .......
21300 .......
21340 .......
21500 .......
21660 .......
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21820 .......
21940 .......
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Urban area (constituent counties)
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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
Des Moines-West Des Moines, IA ....................................................................................................................................
Dallas County, IA
Guthrie County, IA
Madison County, IA
Polk County, IA
Warren County, IA
Detroit-Livonia-Dearborn, MI .............................................................................................................................................
Wayne County, MI
Dothan, AL ........................................................................................................................................................................
Geneva County, AL
Henry County, AL
Houston County, AL
Dover, DE ..........................................................................................................................................................................
Kent County, DE
Dubuque, IA ......................................................................................................................................................................
Dubuque County, IA
Duluth, MN-WI ...................................................................................................................................................................
Carlton County, MN
St. Louis County, MN
Douglas County, WI
Durham, NC ......................................................................................................................................................................
Chatham County, NC
Durham County, NC
Orange County, NC
Person County, NC
Eau Claire, WI ...................................................................................................................................................................
Chippewa County, WI
Eau Claire County, WI
Edison, NJ .........................................................................................................................................................................
Middlesex County, NJ
Monmouth County, NJ
Ocean County, NJ
Somerset County, NJ
El Centro, CA ....................................................................................................................................................................
Imperial County, CA
Elizabethtown, KY .............................................................................................................................................................
Hardin County, KY
Larue County, KY
Elkhart-Goshen, IN ............................................................................................................................................................
Elkhart County, IN
Elmira, NY .........................................................................................................................................................................
Chemung County, NY
El Paso, TX .......................................................................................................................................................................
El Paso County, TX
Erie, PA .............................................................................................................................................................................
Erie County, PA
Eugene-Springfield, OR ....................................................................................................................................................
Lane County, OR
Evansville, IN-KY ..............................................................................................................................................................
Gibson County, IN
Posey County, IN
Vanderburgh County, IN
Warrick County, IN
Henderson County, KY
Webster County, KY
Fairbanks, AK ....................................................................................................................................................................
Fairbanks North Star Borough, AK
Fajardo, PR .......................................................................................................................................................................
Ceiba Municipio, PR
Fajardo Municipio, PR
Luquillo Municipio, PR
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0.9058
0.9975
0.9816
0.9475
1.1181
0.8914
0.8711
0.9611
0.8264
0.8989
0.8495
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0.8662
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Federal Register / Vol. 73, No. 154 / Friday, August 8, 2008 / Rules and Regulations
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TABLE 1—INPATIENT REHABILITATION FACILITY WAGE INDEX FOR URBAN AREAS FOR DISCHARGES OCCURRING FROM
OCTOBER 1, 2008 THROUGH SEPTEMBER 30, 2009—Continued
CBSA code
Urban area (constituent counties)
22020 .......
Fargo, ND-MN ...................................................................................................................................................................
Cass County, ND
Clay County, MN
Farmington, NM ................................................................................................................................................................
San Juan County, NM
Fayetteville, NC .................................................................................................................................................................
Cumberland County, NC
Hoke County, NC
Fayetteville-Springdale-Rogers, AR-MO ...........................................................................................................................
Benton County, AR
Madison County, AR
Washington County, AR
McDonald County, MO
Flagstaff, AZ ......................................................................................................................................................................
Coconino County, AZ
Flint, MI .............................................................................................................................................................................
Genesee County, MI
Florence, SC .....................................................................................................................................................................
Darlington County, SC
Florence County, SC
Florence-Muscle Shoals, AL .............................................................................................................................................
Colbert County, AL
Lauderdale County, AL
Fond du Lac, WI ...............................................................................................................................................................
Fond du Lac County, WI
Fort Collins-Loveland, CO .................................................................................................................................................
Larimer County, CO
Fort Lauderdale-Pompano Beach-Deerfield Beach, FL ....................................................................................................
Broward County, FL
Fort Smith, AR-OK ............................................................................................................................................................
Crawford County, AR
Franklin County, AR
Sebastian County, AR
Le Flore County, OK
Sequoyah County, OK
Fort Walton Beach-Crestview-Destin, FL ..........................................................................................................................
Okaloosa County, FL
Fort Wayne, IN ..................................................................................................................................................................
Allen County, IN
Wells County, IN
Whitley County, IN
Fort Worth-Arlington, TX ...................................................................................................................................................
Johnson County, TX
Parker County, TX
Tarrant County, TX
Wise County, TX
Fresno, CA ........................................................................................................................................................................
Fresno County, CA
Gadsden, AL .....................................................................................................................................................................
Etowah County, AL
Gainesville, FL ..................................................................................................................................................................
Alachua County, FL
Gilchrist County, FL
Gainesville, GA .................................................................................................................................................................
Hall County, GA
Gary, IN .............................................................................................................................................................................
Jasper County, IN
Lake County, IN
Newton County, IN
Porter County, IN
Glens Falls, NY .................................................................................................................................................................
Warren County, NY
Washington County, NY
Goldsboro, NC ..................................................................................................................................................................
Wayne County, NC
Grand Forks, ND-MN ........................................................................................................................................................
Polk County, MN
Grand Forks County, ND
Grand Junction, CO ..........................................................................................................................................................
Mesa County, CO
Grand Rapids-Wyoming, MI ..............................................................................................................................................
22140 .......
22180 .......
22220 .......
22380 .......
22420 .......
22500 .......
22520 .......
22540 .......
22660 .......
22744 .......
22900 .......
23020 .......
23060 .......
23104 .......
23420 .......
23460 .......
23540 .......
23580 .......
23844 .......
24020 .......
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24220 .......
24300 .......
24340 .......
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0.8042
0.9587
0.9368
0.8742
1.1687
1.1220
0.8249
0.7680
0.9667
0.9897
1.0229
0.7933
0.8743
0.9284
0.9693
1.0993
0.8159
0.9196
0.9216
0.9224
0.8256
0.9288
0.7881
0.9864
0.9315
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TABLE 1—INPATIENT REHABILITATION FACILITY WAGE INDEX FOR URBAN AREAS FOR DISCHARGES OCCURRING FROM
OCTOBER 1, 2008 THROUGH SEPTEMBER 30, 2009—Continued
CBSA code
24500 .......
24540 .......
24580 .......
24660 .......
24780 .......
24860 .......
25020 .......
25060 .......
25180 .......
25260 .......
25420 .......
25500 .......
25540 .......
25620 .......
25860 .......
25980 .......
26100 .......
26180 .......
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26300 .......
26380 .......
26420 .......
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Barry County, MI
Ionia County, MI
Kent County, MI
Newaygo County, MI
Great Falls, MT .................................................................................................................................................................
Cascade County, MT
Greeley, CO ......................................................................................................................................................................
Weld County, CO
Green Bay, WI ..................................................................................................................................................................
Brown County, WI
Kewaunee County, WI
Oconto County, WI
Greensboro-High Point, NC ..............................................................................................................................................
Guilford County, NC
Randolph County, NC
Rockingham County, NC
Greenville, NC ...................................................................................................................................................................
Greene County, NC
Pitt County, NC
Greenville-Mauldin-Easley, SC .........................................................................................................................................
Greenville County, SC
Laurens County, SC
Pickens County, SC
Guayama, PR ....................................................................................................................................................................
Arroyo Municipio, PR
Guayama Municipio, PR
Patillas Municipio, PR
Gulfport-Biloxi, MS ............................................................................................................................................................
Hancock County, MS
Harrison County, MS
Stone County, MS
Hagerstown-Martinsburg, MD-WV ....................................................................................................................................
Washington County, MD
Berkeley County, WV
Morgan County, WV
Hanford-Corcoran, CA ......................................................................................................................................................
Kings County, CA
Harrisburg-Carlisle, PA .....................................................................................................................................................
Cumberland County, PA
Dauphin County, PA
Perry County, PA
Harrisonburg, VA ...............................................................................................................................................................
Rockingham County, VA
Harrisonburg City, VA
Hartford-West Hartford-East Hartford, CT ........................................................................................................................
Hartford County, CT
Middlesex County, CT
Tolland County, CT
Hattiesburg, MS ................................................................................................................................................................
Forrest County, MS
Lamar County, MS
Perry County, MS
Hickory-Lenoir-Morganton, NC .........................................................................................................................................
Alexander County, NC
Burke County, NC
Caldwell County, NC
Catawba County, NC
Hinesville-Fort Stewart, GA 1 .............................................................................................................................................
Liberty County, GA
Long County, GA
Holland-Grand Haven, MI .................................................................................................................................................
Ottawa County, MI
Honolulu, HI ......................................................................................................................................................................
Honolulu County, HI
Hot Springs, AR ................................................................................................................................................................
Garland County, AR
Houma-Bayou Cane-Thibodaux, LA .................................................................................................................................
Lafourche Parish, LA
Terrebonne Parish, LA
Houston-Sugar Land-Baytown, TX ...................................................................................................................................
Austin County, TX
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0.9010
0.9402
0.9860
0.3064
0.8773
0.9013
1.0499
0.9280
0.8867
1.0959
0.7366
0.9028
0.9187
0.9006
1.1556
0.9109
0.7892
0.9939
Federal Register / Vol. 73, No. 154 / Friday, August 8, 2008 / Rules and Regulations
46401
TABLE 1—INPATIENT REHABILITATION FACILITY WAGE INDEX FOR URBAN AREAS FOR DISCHARGES OCCURRING FROM
OCTOBER 1, 2008 THROUGH SEPTEMBER 30, 2009—Continued
CBSA code
26580 .......
26620 .......
26820 .......
26900 .......
26980 .......
27060 .......
27100 .......
27140 .......
27180 .......
27260 .......
27340 .......
27500 .......
27620 .......
pwalker on PROD1PC71 with RULES2
27740 .......
27780 .......
27860 .......
VerDate Aug<31>2005
Urban area (constituent counties)
Wage index
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
Huntington-Ashland, WV-KY-OH ......................................................................................................................................
Boyd County, KY
Greenup County, KY
Lawrence County, OH
Cabell County, WV
Wayne County, WV
Huntsville, AL ....................................................................................................................................................................
Limestone County, AL
Madison County, AL
Idaho Falls, ID ...................................................................................................................................................................
Bonneville County, ID
Jefferson County, ID
Indianapolis-Carmel, IN .....................................................................................................................................................
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
Iowa City, IA ......................................................................................................................................................................
Johnson County, IA
Washington County, IA
Ithaca, NY .........................................................................................................................................................................
Tompkins County, NY
Jackson, MI .......................................................................................................................................................................
Jackson County, MI
Jackson, MS ......................................................................................................................................................................
Copiah County, MS
Hinds County, MS
Madison County, MS
Rankin County, MS
Simpson County, MS
Jackson, TN ......................................................................................................................................................................
Chester County, TN
Madison County, TN
Jacksonville, FL .................................................................................................................................................................
Baker County, FL
Clay County, FL
Duval County, FL
Nassau County, FL
St. Johns County, FL
Jacksonville, NC ................................................................................................................................................................
Onslow County, NC
Janesville, WI ....................................................................................................................................................................
Rock County, WI
Jefferson City, MO ............................................................................................................................................................
Callaway County, MO
Cole County, MO
Moniteau County, MO
Osage County, MO
Johnson City, TN ..............................................................................................................................................................
Carter County, TN
Unicoi County, TN
Washington County, TN
Johnstown, PA ..................................................................................................................................................................
Cambria County, PA
Jonesboro, AR ..................................................................................................................................................................
Craighead County, AR
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0.9146
0.9264
0.9844
0.9568
0.9630
0.9329
0.8011
0.8676
0.9021
0.8079
0.9702
0.8478
0.7677
0.7543
0.7790
46402
Federal Register / Vol. 73, No. 154 / Friday, August 8, 2008 / Rules and Regulations
TABLE 1—INPATIENT REHABILITATION FACILITY WAGE INDEX FOR URBAN AREAS FOR DISCHARGES OCCURRING FROM
OCTOBER 1, 2008 THROUGH SEPTEMBER 30, 2009—Continued
CBSA code
27900 .......
28020 .......
28100 .......
28140 .......
28420 .......
28660 .......
28700 .......
28740 .......
28940 .......
29020 .......
29100 .......
29140 .......
29180 .......
29340 .......
pwalker on PROD1PC71 with RULES2
29404 .......
29420 .......
29460 .......
29540 .......
VerDate Aug<31>2005
Urban area (constituent counties)
Wage index
Poinsett County, AR
Joplin, MO .........................................................................................................................................................................
Jasper County, MO
Newton County, MO
Kalamazoo-Portage, MI ....................................................................................................................................................
Kalamazoo County, MI
Van Buren County, MI
Kankakee-Bradley, IL ........................................................................................................................................................
Kankakee County, IL
Kansas City, MO-KS .........................................................................................................................................................
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
Kennewick-Richland-Pasco, WA .......................................................................................................................................
Benton County, WA
Franklin County, WA
Killeen-Temple-Fort Hood, TX ..........................................................................................................................................
Bell County, TX
Coryell County, TX
Lampasas County, TX
Kingsport-Bristol-Bristol, TN-VA ........................................................................................................................................
Hawkins County, TN
Sullivan County, TN
Bristol City, VA
Scott County, VA
Washington County, VA
Kingston, NY .....................................................................................................................................................................
Ulster County, NY
Knoxville, TN .....................................................................................................................................................................
Anderson County, TN
Blount County, TN
Knox County, TN
Loudon County, TN
Union County, TN
Kokomo, IN .......................................................................................................................................................................
Howard County, IN
Tipton County, IN
La Crosse, WI-MN ............................................................................................................................................................
Houston County, MN
La Crosse County, WI
Lafayette, IN ......................................................................................................................................................................
Benton County, IN
Carroll County, IN
Tippecanoe County, IN
Lafayette, LA .....................................................................................................................................................................
Lafayette Parish, LA
St. Martin Parish, LA
Lake Charles, LA ..............................................................................................................................................................
Calcasieu Parish, LA
Cameron Parish, LA
Lake County-Kenosha County, IL-WI ...............................................................................................................................
Lake County, IL
Kenosha County, WI
Lake Havasu City-Kingman, AZ ........................................................................................................................................
Mohave County, AZ
Lakeland, FL .....................................................................................................................................................................
Polk County, FL
Lancaster, PA ....................................................................................................................................................................
Lancaster County, PA
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0.8249
0.7658
0.9556
0.8036
0.9591
0.9685
0.8869
0.8247
0.7777
1.0603
0.9333
0.8661
0.9252
Federal Register / Vol. 73, No. 154 / Friday, August 8, 2008 / Rules and Regulations
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TABLE 1—INPATIENT REHABILITATION FACILITY WAGE INDEX FOR URBAN AREAS FOR DISCHARGES OCCURRING FROM
OCTOBER 1, 2008 THROUGH SEPTEMBER 30, 2009—Continued
CBSA code
Urban area (constituent counties)
29620 .......
Lansing-East Lansing, MI .................................................................................................................................................
Clinton County, MI
Eaton County, MI
Ingham County, MI
Laredo, TX ........................................................................................................................................................................
Webb County, TX
Las Cruces, NM ................................................................................................................................................................
Dona Ana County, NM
Las Vegas-Paradise, NV ...................................................................................................................................................
Clark County, NV
Lawrence, KS ....................................................................................................................................................................
Douglas County, KS
Lawton, OK .......................................................................................................................................................................
Comanche County, OK
Lebanon, PA .....................................................................................................................................................................
Lebanon County, PA
Lewiston, ID-WA ...............................................................................................................................................................
Nez Perce County, ID
Asotin County, WA
Lewiston-Auburn, ME ........................................................................................................................................................
Androscoggin County, ME
Lexington-Fayette, KY .......................................................................................................................................................
Bourbon County, KY
Clark County, KY
Fayette County, KY
Jessamine County, KY
Scott County, KY
Woodford County, KY
Lima, OH ...........................................................................................................................................................................
Allen County, OH
Lincoln, NE ........................................................................................................................................................................
Lancaster County, NE
Seward County, NE
Little Rock-North Little Rock-Conway, AR ........................................................................................................................
Faulkner County, AR
Grant County, AR
Lonoke County, AR
Perry County, AR
Pulaski County, AR
Saline County, AR
Logan, UT-ID .....................................................................................................................................................................
Franklin County, ID
Cache County, UT
Longview, TX ....................................................................................................................................................................
Gregg County, TX
Rusk County, TX
Upshur County, TX
Longview, WA ...................................................................................................................................................................
Cowlitz County, WA
Los Angeles-Long Beach-Santa Ana, CA ........................................................................................................................
Los Angeles County, CA
Louisville-Jefferson County, KY-IN ...................................................................................................................................
Clark County, IN
Floyd County, IN
Harrison County, IN
Washington County, IN
Bullitt County, KY
Henry County, KY
Meade County, KY
Nelson County, KY
Oldham County, KY
Shelby County, KY
Spencer County, KY
Trimble County, KY
Lubbock, TX ......................................................................................................................................................................
Crosby County, TX
Lubbock County, TX
Lynchburg, VA ...................................................................................................................................................................
Amherst County, VA
Appomattox County, VA
Bedford County, VA
29700 .......
29740 .......
29820 .......
29940 .......
30020 .......
30140 .......
30300 .......
30340 .......
30460 .......
30620 .......
30700 .......
30780 .......
30860 .......
30980 .......
31020 .......
31084 .......
31140 .......
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31180 .......
31340 .......
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08AUR2
1.0119
0.8093
0.8676
1.1799
0.8227
0.8025
0.8192
0.9454
0.9193
0.9191
0.9424
1.0051
0.8863
0.9183
0.8717
1.0827
1.1771
0.9065
0.8680
0.8732
46404
Federal Register / Vol. 73, No. 154 / Friday, August 8, 2008 / Rules and Regulations
TABLE 1—INPATIENT REHABILITATION FACILITY WAGE INDEX FOR URBAN AREAS FOR DISCHARGES OCCURRING FROM
OCTOBER 1, 2008 THROUGH SEPTEMBER 30, 2009—Continued
CBSA code
31420 .......
31460 .......
31540 .......
31700 .......
31900 .......
32420 .......
32580 .......
32780 .......
32820 .......
32900 .......
33124 .......
33140 .......
33260 .......
33340 .......
33460 .......
33540 .......
pwalker on PROD1PC71 with RULES2
33660 .......
33700 .......
33740 .......
VerDate Aug<31>2005
Urban area (constituent counties)
Wage index
Campbell County, VA
Bedford City, VA
Lynchburg City, VA
Macon, GA ........................................................................................................................................................................
Bibb County, GA
Crawford County, GA
Jones County, GA
Monroe County, GA
Twiggs County, GA
Madera, CA .......................................................................................................................................................................
Madera County, CA
Madison, WI ......................................................................................................................................................................
Columbia County, WI
Dane County, WI
Iowa County, WI
Manchester-Nashua, NH ...................................................................................................................................................
Hillsborough County, NH
Mansfield, OH 1 .................................................................................................................................................................
Richland County, OH
¨
Mayaguez, PR ...................................................................................................................................................................
Hormigueros Municipio, PR
¨
Mayaguez Municipio, PR
McAllen-Edinburg-Mission, TX ..........................................................................................................................................
Hidalgo County, TX
Medford, OR ......................................................................................................................................................................
Jackson County, OR
Memphis, TN-MS-AR ........................................................................................................................................................
Crittenden County, AR
DeSoto County, MS
Marshall County, MS
Tate County, MS
Tunica County, MS
Fayette County, TN
Shelby County, TN
Tipton County, TN
Merced, CA .......................................................................................................................................................................
Merced County, CA
Miami-Miami Beach-Kendall, FL .......................................................................................................................................
Miami-Dade County, FL
Michigan City-La Porte, IN ................................................................................................................................................
LaPorte County, IN
Midland, TX .......................................................................................................................................................................
Midland County, TX
Milwaukee-Waukesha-West Allis, WI ................................................................................................................................
Milwaukee County, WI
Ozaukee County, WI
Washington County, WI
Waukesha County, WI
Minneapolis-St. Paul—Bloomington, MN-WI ....................................................................................................................
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
Missoula, MT .....................................................................................................................................................................
Missoula County, MT
Mobile, AL .........................................................................................................................................................................
Mobile County, AL
Modesto, CA .....................................................................................................................................................................
Stanislaus County, CA
Monroe, LA ........................................................................................................................................................................
Ouachita Parish, LA
Union Parish, LA
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1.0935
1.0273
0.9271
0.3711
0.9123
1.0318
0.9250
1.2120
1.0002
0.8914
1.0017
1.0214
1.1093
0.8953
0.8033
1.1962
0.7832
Federal Register / Vol. 73, No. 154 / Friday, August 8, 2008 / Rules and Regulations
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TABLE 1—INPATIENT REHABILITATION FACILITY WAGE INDEX FOR URBAN AREAS FOR DISCHARGES OCCURRING FROM
OCTOBER 1, 2008 THROUGH SEPTEMBER 30, 2009—Continued
CBSA code
Urban area (constituent counties)
33780 .......
Monroe, MI ........................................................................................................................................................................
Monroe County, MI
Montgomery, AL ................................................................................................................................................................
Autauga County, AL
Elmore County, AL
Lowndes County, AL
Montgomery County, AL
Morgantown, WV ...............................................................................................................................................................
Monongalia County, WV
Preston County, WV
Morristown, TN ..................................................................................................................................................................
Grainger County, TN
Hamblen County, TN
Jefferson County, TN
Mount Vernon-Anacortes, WA ..........................................................................................................................................
Skagit County, WA
Muncie, IN .........................................................................................................................................................................
Delaware County, IN
Muskegon-Norton Shores, MI ...........................................................................................................................................
Muskegon County, MI
Myrtle Beach-Conway-North Myrtle Beach, SC ................................................................................................................
Horry County, SC
Napa, CA ...........................................................................................................................................................................
Napa County, CA
Naples-Marco Island, FL ...................................................................................................................................................
Collier County, FL
Nashville-Davidson-Murfreesboro-Franklin, TN ................................................................................................................
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
Nassau-Suffolk, NY ...........................................................................................................................................................
Nassau County, NY
Suffolk County, NY
Newark-Union, NJ-PA .......................................................................................................................................................
Essex County, NJ
Hunterdon County, NJ
Morris County, NJ
Sussex County, NJ
Union County, NJ
Pike County, PA
New Haven-Milford, CT .....................................................................................................................................................
New Haven County, CT
New Orleans-Metairie-Kenner, LA ....................................................................................................................................
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
New York-White Plains-Wayne, NY-NJ ............................................................................................................................
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
33860 .......
34060 .......
34100 .......
34580 .......
34620 .......
34740 .......
34820 .......
34900 .......
34940 .......
34980 .......
35004 .......
35084 .......
35300 .......
35380 .......
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35644 .......
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08AUR2
0.9414
0.8088
0.8321
0.7388
1.0529
0.8214
0.9836
0.8634
1.4476
0.9487
0.9689
1.2640
1.1862
1.1871
0.8897
1.3115
46406
Federal Register / Vol. 73, No. 154 / Friday, August 8, 2008 / Rules and Regulations
TABLE 1—INPATIENT REHABILITATION FACILITY WAGE INDEX FOR URBAN AREAS FOR DISCHARGES OCCURRING FROM
OCTOBER 1, 2008 THROUGH SEPTEMBER 30, 2009—Continued
CBSA code
35660 .......
35980 .......
36084 .......
36100 .......
36140 .......
36220 .......
36260 .......
36420 .......
36500 .......
36540 .......
36740 .......
36780 .......
36980 .......
37100 .......
37340 .......
37380 .......
37460 .......
37620 .......
37700 .......
pwalker on PROD1PC71 with RULES2
37764 .......
37860 .......
37900 .......
VerDate Aug<31>2005
Urban area (constituent counties)
Wage index
Westchester County, NY
Niles-Benton Harbor, MI ...................................................................................................................................................
Berrien County, MI
Norwich-New London, CT .................................................................................................................................................
New London County, CT
Oakland-Fremont-Hayward, CA ........................................................................................................................................
Alameda County, CA
Contra Costa County, CA
Ocala, FL ...........................................................................................................................................................................
Marion County, FL
Ocean City, NJ ..................................................................................................................................................................
Cape May County, NJ
Odessa, TX .......................................................................................................................................................................
Ector County, TX
Ogden-Clearfield, UT ........................................................................................................................................................
Davis County, UT
Morgan County, UT
Weber County, UT
Oklahoma City, OK ...........................................................................................................................................................
Canadian County, OK
Cleveland County, OK
Grady County, OK
Lincoln County, OK
Logan County, OK
McClain County, OK
Oklahoma County, OK
Olympia, WA .....................................................................................................................................................................
Thurston County, WA
Omaha-Council Bluffs, NE-IA ...........................................................................................................................................
Harrison County, IA
Mills County, IA
Pottawattamie County, IA
Cass County, NE
Douglas County, NE
Sarpy County, NE
Saunders County, NE
Washington County, NE
Orlando-Kissimmee, FL ....................................................................................................................................................
Lake County, FL
Orange County, FL
Osceola County, FL
Seminole County, FL
Oshkosh-Neenah, WI ........................................................................................................................................................
Winnebago County, WI
Owensboro, KY .................................................................................................................................................................
Daviess County, KY
Hancock County, KY
McLean County, KY
Oxnard-Thousand Oaks-Ventura, CA ...............................................................................................................................
Ventura County, CA
Palm Bay-Melbourne-Titusville, FL ...................................................................................................................................
Brevard County, FL
Palm Coast, FL .................................................................................................................................................................
Flagler County, FL
Panama City-Lynn Haven, FL ...........................................................................................................................................
Bay County, FL
Parkersburg-Marietta-Vienna, WV-OH ..............................................................................................................................
Washington County, OH
Pleasants County, WV
Wirt County, WV
Wood County, WV
Pascagoula, MS ................................................................................................................................................................
George County, MS
Jackson County, MS
Peabody, MA .....................................................................................................................................................................
Essex County, MA
Pensacola-Ferry Pass-Brent, FL .......................................................................................................................................
Escambia County, FL
Santa Rosa County, FL
Peoria, IL ...........................................................................................................................................................................
Marshall County, IL
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1.5685
0.8627
1.0988
1.0042
0.9000
0.8815
1.1512
0.9561
0.9226
0.9551
0.8652
1.1852
0.9325
0.8945
0.8313
0.8105
0.8647
1.0650
0.8281
0.9299
Federal Register / Vol. 73, No. 154 / Friday, August 8, 2008 / Rules and Regulations
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TABLE 1—INPATIENT REHABILITATION FACILITY WAGE INDEX FOR URBAN AREAS FOR DISCHARGES OCCURRING FROM
OCTOBER 1, 2008 THROUGH SEPTEMBER 30, 2009—Continued
CBSA code
37964 .......
38060 .......
38220 .......
38300 .......
38340 .......
38540 .......
38660 .......
38860 .......
38900 .......
38940 .......
39100 .......
39140 .......
39300 .......
39340 .......
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39380 .......
39460 .......
39540 .......
39580 .......
VerDate Aug<31>2005
Urban area (constituent counties)
Wage index
Peoria County, IL
Stark County, IL
Tazewell County, IL
Woodford County, IL
Philadelphia, PA ................................................................................................................................................................
Bucks County, PA
Chester County, PA
Delaware County, PA
Montgomery County, PA
Philadelphia County, PA
Phoenix-Mesa-Scottsdale, AZ ...........................................................................................................................................
Maricopa County, AZ
Pinal County, AZ
Pine Bluff, AR ....................................................................................................................................................................
Cleveland County, AR
Jefferson County, AR
Lincoln County, AR
Pittsburgh, PA ...................................................................................................................................................................
Allegheny County, PA
Armstrong County, PA
Beaver County, PA
Butler County, PA
Fayette County, PA
Washington County, PA
Westmoreland County, PA
Pittsfield, MA .....................................................................................................................................................................
Berkshire County, MA
Pocatello, ID ......................................................................................................................................................................
Bannock County, ID
Power County, ID
Ponce, PR .........................................................................................................................................................................
´
Juana Dıaz Municipio, PR
Ponce Municipio, PR
Villalba Municipio, PR
Portland-South Portland-Biddeford, ME ............................................................................................................................
Cumberland County, ME
Sagadahoc County, ME
York County, ME
Portland-Vancouver-Beaverton, OR-WA ..........................................................................................................................
Clackamas County, OR
Columbia County, OR
Multnomah County, OR
Washington County, OR
Yamhill County, OR
Clark County, WA
Skamania County, WA
Port St. Lucie, FL ..............................................................................................................................................................
Martin County, FL
St. Lucie County, FL
Poughkeepsie-Newburgh-Middletown, NY ........................................................................................................................
Dutchess County, NY
Orange County, NY
Prescott, AZ ......................................................................................................................................................................
Yavapai County, AZ
Providence-New Bedford-Fall River, RI-MA .....................................................................................................................
Bristol County, MA
Bristol County, RI
Kent County, RI
Newport County, RI
Providence County, RI
Washington County, RI
Provo-Orem, UT ................................................................................................................................................................
Juab County, UT
Utah County, UT
Pueblo, CO ........................................................................................................................................................................
Pueblo County, CO
Punta Gorda, FL ...............................................................................................................................................................
Charlotte County, FL
Racine, WI .........................................................................................................................................................................
Racine County, WI
Raleigh-Cary, NC ..............................................................................................................................................................
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1.0925
1.0264
0.7839
0.8525
1.0091
0.9465
0.4450
1.0042
1.1498
1.0016
1.0982
1.0020
1.0574
0.9557
0.8851
0.9254
0.9498
0.9839
46408
Federal Register / Vol. 73, No. 154 / Friday, August 8, 2008 / Rules and Regulations
TABLE 1—INPATIENT REHABILITATION FACILITY WAGE INDEX FOR URBAN AREAS FOR DISCHARGES OCCURRING FROM
OCTOBER 1, 2008 THROUGH SEPTEMBER 30, 2009—Continued
CBSA code
39660 .......
39740 .......
39820 .......
39900 .......
40060 .......
40140 .......
40220 .......
40340 .......
40380 .......
40420 .......
40484 .......
40580 .......
pwalker on PROD1PC71 with RULES2
40660 .......
40900 .......
40980 .......
VerDate Aug<31>2005
Urban area (constituent counties)
Wage index
Franklin County, NC
Johnston County, NC
Wake County, NC
Rapid City, SD ..................................................................................................................................................................
Meade County, SD
Pennington County, SD
Reading, PA ......................................................................................................................................................................
Berks County, PA
Redding, CA ......................................................................................................................................................................
Shasta County, CA
Reno-Sparks, NV ..............................................................................................................................................................
Storey County, NV
Washoe County, NV
Richmond, VA ...................................................................................................................................................................
Amelia County, VA
Caroline County, VA
Charles City County, VA
Chesterfield County, VA
Cumberland County, VA
Dinwiddie County, VA
Goochland County, VA
Hanover County, VA
Henrico County, VA
King and Queen County, VA
King William County, VA
Louisa County, VA
New Kent County, VA
Powhatan County, VA
Prince George County, VA
Sussex County, VA
Colonial Heights City, VA
Hopewell City, VA
Petersburg City, VA
Richmond City, VA
Riverside-San Bernardino-Ontario, CA .............................................................................................................................
Riverside County, CA
San Bernardino County, CA
Roanoke, VA .....................................................................................................................................................................
Botetourt County, VA
Craig County, VA
Franklin County, VA
Roanoke County, VA
Roanoke City, VA
Salem City, VA
Rochester, MN ..................................................................................................................................................................
Dodge County, MN
Olmsted County, MN
Wabasha County, MN
Rochester, NY ...................................................................................................................................................................
Livingston County, NY
Monroe County, NY
Ontario County, NY
Orleans County, NY
Wayne County, NY
Rockford, IL .......................................................................................................................................................................
Boone County, IL
Winnebago County, IL
Rockingham County, NH ..................................................................................................................................................
Rockingham County, NH
Strafford County, NH
Rocky Mount, NC ..............................................................................................................................................................
Edgecombe County, NC
Nash County, NC
Rome, GA .........................................................................................................................................................................
Floyd County, GA
Sacramento—Arden-Arcade—Roseville, CA ....................................................................................................................
El Dorado County, CA
Placer County, CA
Sacramento County, CA
Yolo County, CA
Saginaw-Saginaw Township North, MI .............................................................................................................................
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0.9356
1.3541
1.0715
0.9425
1.1100
0.8691
1.0755
0.8858
0.9814
1.0111
0.9001
0.9042
1.3505
0.8812
Federal Register / Vol. 73, No. 154 / Friday, August 8, 2008 / Rules and Regulations
46409
TABLE 1—INPATIENT REHABILITATION FACILITY WAGE INDEX FOR URBAN AREAS FOR DISCHARGES OCCURRING FROM
OCTOBER 1, 2008 THROUGH SEPTEMBER 30, 2009—Continued
CBSA code
41060 .......
41100 .......
41140 .......
41180 .......
41420 .......
41500 .......
41540 .......
41620 .......
41660 .......
41700 .......
41740 .......
41780 .......
41884 .......
pwalker on PROD1PC71 with RULES2
41900 .......
41940 .......
41980 .......
VerDate Aug<31>2005
Urban area (constituent counties)
Wage index
Saginaw County, MI
St. Cloud, MN ....................................................................................................................................................................
Benton County, MN
Stearns County, MN
St. George, UT ..................................................................................................................................................................
Washington County, UT
St. Joseph, MO-KS ...........................................................................................................................................................
Doniphan County, KS
Andrew County, MO
Buchanan County, MO
DeKalb County, MO
St. Louis, MO-IL ................................................................................................................................................................
Bond County, IL
Calhoun County, IL
Clinton County, IL
Jersey County, IL
Macoupin County, IL
Madison County, IL
Monroe County, IL
St. Clair County, IL
Crawford County, MO
Franklin County, MO
Jefferson County, MO
Lincoln County, MO
St. Charles County, MO
St. Louis County, MO
Warren County, MO
Washington County, MO
St. Louis City, MO
Salem, OR .........................................................................................................................................................................
Marion County, OR
Polk County, OR
Salinas, CA .......................................................................................................................................................................
Monterey County, CA
Salisbury, MD ....................................................................................................................................................................
Somerset County, MD
Wicomico County, MD
Salt Lake City, UT .............................................................................................................................................................
Salt Lake County, UT
Summit County, UT
Tooele County, UT
San Angelo, TX .................................................................................................................................................................
Irion County, TX
Tom Green County, TX
San Antonio, TX ................................................................................................................................................................
Atascosa County, TX
Bandera County, TX
Bexar County, TX
Comal County, TX
Guadalupe County, TX
Kendall County, TX
Medina County, TX
Wilson County, TX
San Diego-Carlsbad-San Marcos, CA ..............................................................................................................................
San Diego County, CA
Sandusky, OH ...................................................................................................................................................................
Erie County, OH
San Francisco-San Mateo-Redwood City, CA ..................................................................................................................
Marin County, CA
San Francisco County, CA
San Mateo County, CA
´
San German-Cabo Rojo, PR ............................................................................................................................................
Cabo Rojo Municipio, PR
Lajas Municipio, PR
Sabana Grande Municipio, PR
´
San German Municipio, PR
San Jose-Sunnyvale-Santa Clara, CA ..............................................................................................................................
San Benito County, CA
Santa Clara County, CA
San Juan-Caguas-Guaynabo, PR ....................................................................................................................................
Aguas Buenas Municipio, PR
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0.9358
0.8762
0.9024
1.0572
1.4775
0.8994
0.9399
0.8579
0.8834
1.1492
0.8822
1.5195
0.4729
1.5735
0.4528
46410
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TABLE 1—INPATIENT REHABILITATION FACILITY WAGE INDEX FOR URBAN AREAS FOR DISCHARGES OCCURRING FROM
OCTOBER 1, 2008 THROUGH SEPTEMBER 30, 2009—Continued
CBSA code
42020 .......
42044 .......
42060 .......
42100 .......
42140 .......
42220 .......
42260 .......
42340 .......
42540 .......
pwalker on PROD1PC71 with RULES2
42644 .......
42680 .......
43100 .......
43300 .......
VerDate Aug<31>2005
Urban area (constituent counties)
Wage index
Aibonito Municipio, PR
Arecibo Municipio, PR
Barceloneta Municipio, PR
Barranquitas Municipio, PR
´
Bayamon Municipio, PR
Caguas Municipio, PR
Camuy Municipio, PR
´
Canovanas Municipio, PR
Carolina Municipio, PR
˜
Catano Municipio, PR
Cayey Municipio, PR
Ciales Municipio, PR
Cidra Municipio, PR
´
Comerıo Municipio, PR
Corozal Municipio, PR
Dorado Municipio, PR
Florida Municipio, PR
Guaynabo Municipio, PR
Gurabo Municipio, PR
Hatillo Municipio, PR
Humacao Municipio, PR
Juncos Municipio, PR
Las Piedras Municipio, PR
´
Loıza Municipio, PR
´
Manatı Municipio, PR
Maunabo Municipio, PR
Morovis Municipio, PR
Naguabo Municipio, PR
Naranjito Municipio, PR
Orocovis Municipio, PR
Quebradillas Municipio, PR
´
Rıo 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
San Luis Obispo-Paso Robles, CA ...................................................................................................................................
San Luis Obispo County, CA
Santa Ana-Anaheim-Irvine, CA .........................................................................................................................................
Orange County, CA
Santa Barbara-Santa Maria-Goleta, CA ...........................................................................................................................
Santa Barbara County, CA
Santa Cruz-Watsonville, CA .............................................................................................................................................
Santa Cruz County, CA
Santa Fe, NM ....................................................................................................................................................................
Santa Fe County, NM
Santa Rosa-Petaluma, CA ................................................................................................................................................
Sonoma County, CA
Sarasota-Bradenton-Venice, FL ........................................................................................................................................
Manatee County, FL
Sarasota County, FL
Savannah, GA ...................................................................................................................................................................
Bryan County, GA
Chatham County, GA
Effingham County, GA
Scranton—Wilkes-Barre, PA .............................................................................................................................................
Lackawanna County, PA
Luzerne County, PA
Wyoming County, PA
Seattle-Bellevue-Everett, WA ............................................................................................................................................
King County, WA
Snohomish County, WA
Sebastian-Vero Beach, FL ................................................................................................................................................
Indian River County, FL
Sheboygan, WI ..................................................................................................................................................................
Sheboygan County, WI
Sherman-Denison, TX .......................................................................................................................................................
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1.2488
1.1766
1.1714
1.6122
1.0734
1.4696
0.9933
0.9131
0.8457
1.1572
0.9412
0.8975
0.8320
Federal Register / Vol. 73, No. 154 / Friday, August 8, 2008 / Rules and Regulations
46411
TABLE 1—INPATIENT REHABILITATION FACILITY WAGE INDEX FOR URBAN AREAS FOR DISCHARGES OCCURRING FROM
OCTOBER 1, 2008 THROUGH SEPTEMBER 30, 2009—Continued
CBSA code
43340 .......
43580 .......
43620 .......
43780 .......
43900 .......
44060 .......
44100 .......
44140 .......
44180 .......
44220 .......
44300 .......
44700 .......
44940 .......
45060 .......
45104 .......
45220 .......
45300 .......
45460 .......
pwalker on PROD1PC71 with RULES2
45500 .......
45780 .......
VerDate Aug<31>2005
Urban area (constituent counties)
Wage index
Grayson County, TX
Shreveport-Bossier City, LA ..............................................................................................................................................
Bossier Parish, LA
Caddo Parish, LA
De Soto Parish, LA
Sioux City, IA-NE-SD ........................................................................................................................................................
Woodbury County, IA
Dakota County, NE
Dixon County, NE
Union County, SD
Sioux Falls, SD .................................................................................................................................................................
Lincoln County, SD
McCook County, SD
Minnehaha County, SD
Turner County, SD
South Bend-Mishawaka, IN-MI .........................................................................................................................................
St. Joseph County, IN
Cass County, MI
Spartanburg, SC ...............................................................................................................................................................
Spartanburg County, SC
Spokane, WA ....................................................................................................................................................................
Spokane County, WA
Springfield, IL ....................................................................................................................................................................
Menard County, IL
Sangamon County, IL
Springfield, MA ..................................................................................................................................................................
Franklin County, MA
Hampden County, MA
Hampshire County, MA
Springfield, MO .................................................................................................................................................................
Christian County, MO
Dallas County, MO
Greene County, MO
Polk County, MO
Webster County, MO
Springfield, OH ..................................................................................................................................................................
Clark County, OH
State College, PA ..............................................................................................................................................................
Centre County, PA
Stockton, CA .....................................................................................................................................................................
San Joaquin County, CA
Sumter, SC ........................................................................................................................................................................
Sumter County, SC
Syracuse, NY ....................................................................................................................................................................
Madison County, NY
Onondaga County, NY
Oswego County, NY
Tacoma, WA .....................................................................................................................................................................
Pierce County, WA
Tallahassee, FL .................................................................................................................................................................
Gadsden County, FL
Jefferson County, FL
Leon County, FL
Wakulla County, FL
Tampa-St. Petersburg-Clearwater, FL ..............................................................................................................................
Hernando County, FL
Hillsborough County, FL
Pasco County, FL
Pinellas County, FL
Terre Haute, IN .................................................................................................................................................................
Clay County, IN
Sullivan County, IN
Vermillion County, IN
Vigo County, IN
Texarkana, TX-Texarkana, AR .........................................................................................................................................
Miller County, AR
Bowie County, TX
Toledo, OH ........................................................................................................................................................................
Fulton County, OH
Lucas County, OH
Ottawa County, OH
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0.8476
0.9251
0.9563
0.9617
0.9422
1.0455
0.8944
1.0366
0.8695
0.8694
0.8768
1.1855
0.8599
0.9910
1.1055
0.9025
0.9020
0.8805
0.7770
0.9431
46412
Federal Register / Vol. 73, No. 154 / Friday, August 8, 2008 / Rules and Regulations
TABLE 1—INPATIENT REHABILITATION FACILITY WAGE INDEX FOR URBAN AREAS FOR DISCHARGES OCCURRING FROM
OCTOBER 1, 2008 THROUGH SEPTEMBER 30, 2009—Continued
CBSA code
45820 .......
45940 .......
46060 .......
46140 .......
46220 .......
46340 .......
46540 .......
46660 .......
46700 .......
47020 .......
47220 .......
47260 .......
47300 .......
47380 .......
47580 .......
pwalker on PROD1PC71 with RULES2
47644 .......
47894 .......
VerDate Aug<31>2005
Urban area (constituent counties)
Wage index
Wood County, OH
Topeka, KS .......................................................................................................................................................................
Jackson County, KS
Jefferson County, KS
Osage County, KS
Shawnee County, KS
Wabaunsee County, KS
Trenton-Ewing, NJ ............................................................................................................................................................
Mercer County, NJ
Tucson, AZ ........................................................................................................................................................................
Pima County, AZ
Tulsa, OK ..........................................................................................................................................................................
Creek County, OK
Okmulgee County, OK
Osage County, OK
Pawnee County, OK
Rogers County, OK
Tulsa County, OK
Wagoner County, OK
Tuscaloosa, AL .................................................................................................................................................................
Greene County, AL
Hale County, AL
Tuscaloosa County, AL
Tyler, TX ............................................................................................................................................................................
Smith County, TX
Utica-Rome, NY ................................................................................................................................................................
Herkimer County, NY
Oneida County, NY
Valdosta, GA .....................................................................................................................................................................
Brooks County, GA
Echols County, GA
Lanier County, GA
Lowndes County, GA
Vallejo-Fairfield, CA ..........................................................................................................................................................
Solano County, CA
Victoria, TX ........................................................................................................................................................................
Calhoun County, TX
Goliad County, TX
Victoria County, TX
Vineland-Millville-Bridgeton, NJ ........................................................................................................................................
Cumberland County, NJ
Virginia Beach-Norfolk-Newport News, VA-NC ................................................................................................................
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
Visalia-Porterville, CA .......................................................................................................................................................
Tulare County, CA
Waco, TX ..........................................................................................................................................................................
McLennan County, TX
Warner Robins, GA ...........................................................................................................................................................
Houston County, GA
Warren-Troy-Farmington Hills, MI .....................................................................................................................................
Lapeer County, MI
Livingston County, MI
Macomb County, MI
Oakland County, MI
St. Clair County, MI
Washington-Arlington-Alexandria, DC-VA-MD-WV ...........................................................................................................
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0.8538
1.0699
0.9245
0.8340
0.8303
0.9114
0.8486
0.8098
1.4666
0.8302
1.0133
0.8818
1.0091
0.8518
0.9128
1.0001
1.0855
Federal Register / Vol. 73, No. 154 / Friday, August 8, 2008 / Rules and Regulations
46413
TABLE 1—INPATIENT REHABILITATION FACILITY WAGE INDEX FOR URBAN AREAS FOR DISCHARGES OCCURRING FROM
OCTOBER 1, 2008 THROUGH SEPTEMBER 30, 2009—Continued
CBSA code
47940 .......
48140 .......
48260 .......
48300 .......
48424 .......
48540 .......
48620 .......
48660 .......
48700 .......
48864 .......
48900 .......
49020 .......
pwalker on PROD1PC71 with RULES2
49180 .......
49340 .......
49420 .......
VerDate Aug<31>2005
Urban area (constituent counties)
Wage index
District of Columbia, DC
Calvert County, MD
Charles County, MD
Prince George’s County, MD
Arlington County, VA
Clarke County, VA
Fairfax County, VA
Fauquier County, VA
Loudoun County, VA
Prince William County, VA
Spotsylvania County, VA
Stafford County, VA
Warren County, VA
Alexandria City, VA
Fairfax City, VA
Falls Church City, VA
Fredericksburg City, VA
Manassas City, VA
Manassas Park City, VA
Jefferson County, WV
Waterloo-Cedar Falls, IA ...................................................................................................................................................
Black Hawk County, IA
Bremer County, IA
Grundy County, IA
Wausau, WI .......................................................................................................................................................................
Marathon County, WI
Weirton-Steubenville, WV-OH ...........................................................................................................................................
Jefferson County, OH
Brooke County, WV
Hancock County, WV
Wenatchee, WA ................................................................................................................................................................
Chelan County, WA
Douglas County, WA
West Palm Beach-Boca Raton-Boynton Beach, FL .........................................................................................................
Palm Beach County, FL
Wheeling, WV-OH .............................................................................................................................................................
Belmont County, OH
Marshall County, WV
Ohio County, WV
Wichita, KS ........................................................................................................................................................................
Butler County, KS
Harvey County, KS
Sedgwick County, KS
Sumner County, KS
Wichita Falls, TX ...............................................................................................................................................................
Archer County, TX
Clay County, TX
Wichita County, TX
Williamsport, PA ................................................................................................................................................................
Lycoming County, PA
Wilmington, DE-MD-NJ .....................................................................................................................................................
New Castle County, DE
Cecil County, MD
Salem County, NJ
Wilmington, NC .................................................................................................................................................................
Brunswick County, NC
New Hanover County, NC
Pender County, NC
Winchester, VA-WV ..........................................................................................................................................................
Frederick County, VA
Winchester City, VA
Hampshire County, WV
Winston-Salem, NC ...........................................................................................................................................................
Davie County, NC
Forsyth County, NC
Stokes County, NC
Yadkin County, NC
Worcester, MA ..................................................................................................................................................................
Worcester County, MA
Yakima, WA ......................................................................................................................................................................
Yakima County, WA
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0.8519
0.9679
0.7924
1.1469
0.9728
0.6961
0.9062
0.7920
0.8043
1.0824
0.9410
0.9913
0.9118
1.1287
1.0267
46414
Federal Register / Vol. 73, No. 154 / Friday, August 8, 2008 / Rules and Regulations
TABLE 1—INPATIENT REHABILITATION FACILITY WAGE INDEX FOR URBAN AREAS FOR DISCHARGES OCCURRING FROM
OCTOBER 1, 2008 THROUGH SEPTEMBER 30, 2009—Continued
CBSA code
Urban area (constituent counties)
49500 .......
Yauco, PR .........................................................................................................................................................................
´
Guanica Municipio, PR
Guayanilla Municipio, PR
˜
Penuelas Municipio, PR
Yauco Municipio, PR
York-Hanover, PA .............................................................................................................................................................
York County, PA
Youngstown-Warren-Boardman, OH-PA ..........................................................................................................................
Mahoning County, OH
Trumbull County, OH
Mercer County, PA
Yuba City, CA ...................................................................................................................................................................
Sutter County, CA
Yuba County, CA
Yuma, AZ ..........................................................................................................................................................................
Yuma County, AZ
49620 .......
49660 .......
49700 .......
49740 .......
1 At
0.3284
0.9359
0.9002
1.0756
0.9488
this time, there are no hospitals located in this urban area on which to base a wage index.
TABLE 2—INPATIENT REHABILITATION
FACILITY WAGE INDEX FOR RURAL
AREAS FOR DISCHARGES OCCURRING FROM OCTOBER 1, 2008
THROUGH SEPTEMBER 30, 2009
CBSA code
Nonurban area
1 ................
2 ................
3 ................
4 ................
5 ................
6 ................
7 ................
8 ................
10 ..............
11 ..............
12 ..............
13 ..............
14 ..............
15 ..............
16 ..............
17 ..............
18 ..............
19 ..............
20 ..............
21 ..............
22 ..............
23 ..............
24 ..............
pwalker on PROD1PC71 with RULES2
Wage index
Alabama ............
Alaska ................
Arizona ..............
Arkansas ............
California ...........
Colorado ............
Connecticut ........
Delaware ...........
Florida ................
Georgia ..............
Hawaii ................
Idaho ..................
Illinois .................
Indiana ...............
Iowa ...................
Kansas ...............
Kentucky ............
Louisiana ...........
Maine .................
Maryland ............
Massachusetts 1
Michigan ............
Minnesota ..........
VerDate Aug<31>2005
17:29 Aug 07, 2008
Wage index
0.7533
1.2109
0.8479
0.7371
1.2023
0.9704
1.1119
0.9727
0.8465
0.7659
1.0612
0.7920
0.8335
0.8576
0.8566
0.7981
0.7793
0.7373
0.8476
0.9034
1.1589
0.8953
0.9079
Jkt 214001
TABLE 2—INPATIENT REHABILITATION
FACILITY WAGE INDEX FOR RURAL
AREAS FOR DISCHARGES OCCURRING FROM OCTOBER 1, 2008
THROUGH SEPTEMBER 30, 2009—
Continued
CBSA code
25
26
27
28
29
30
31
32
33
34
35
36
37
38
39
40
41
42
43
44
45
PO 00000
..............
..............
..............
..............
..............
..............
..............
..............
..............
..............
..............
..............
..............
..............
..............
..............
..............
..............
..............
..............
..............
Frm 00046
Nonurban area
Mississippi .........
Missouri .............
Montana .............
Nebraska ...........
Nevada ..............
New Hampshire
New Jersey 1 .....
New Mexico .......
New York ...........
North Carolina ...
North Dakota .....
Ohio ...................
Oklahoma ..........
Oregon ...............
Pennsylvania .....
Puerto Rico 1 .....
Rhode Island 1 ...
South Carolina ...
South Dakota .....
Tennessee .........
Texas .................
Fmt 4701
Sfmt 4700
Wage index
0.7700
0.7930
0.8379
0.8849
0.9272
0.0470
—
0.8940
0.8268
0.8603
0.7182
0.8714
0.7492
0.9906
0.8385
0.4047
—
0.8656
0.8549
0.7723
0.7968
TABLE 2—INPATIENT REHABILITATION
FACILITY WAGE INDEX FOR RURAL
AREAS FOR DISCHARGES OCCURRING FROM OCTOBER 1, 2008
THROUGH SEPTEMBER 30, 2009—
Continued
CBSA code
46
47
48
49
50
51
52
53
65
..............
..............
..............
..............
..............
..............
..............
..............
..............
Nonurban area
Utah ...................
Vermont .............
Virgin Islands .....
Virginia ...............
Washington ........
West Virginia .....
Wisconsin ..........
Wyoming ............
Guam .................
Wage index
0.8116
0.9919
0.6830
0.7896
1.0259
0.7454
0.9667
0.9287
0.9611
1 All counties within the State are classified
as urban, with the exception of Massachusetts
and Puerto Rico. Massachusetts and Puerto
Rico have areas designated as rural; however,
no short-term, acute care hospitals are located
in the area(s) for FY 2009. The rural Massachusetts wage index is calculated as the average of all contiguous CBSAs. The Puerto Rico
wage index is the same as FY 2008.
[FR Doc. E8–17797 Filed 7–31–08; 4:15 pm]
BILLING CODE 4120–01–P
E:\FR\FM\08AUR2.SGM
08AUR2
Agencies
[Federal Register Volume 73, Number 154 (Friday, August 8, 2008)]
[Rules and Regulations]
[Pages 46370-46414]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E8-17797]
[[Page 46369]]
-----------------------------------------------------------------------
Part II
Department of Health and Human Services
-----------------------------------------------------------------------
Centers for Medicare & Medicaid Services
-----------------------------------------------------------------------
42 CFR Part 412
Medicare Program; Inpatient Rehabilitation Facility Prospective
Payment System for Federal Fiscal Year 2009; Final Rule
Federal Register / Vol. 73, No. 154 / Friday, August 8, 2008 / Rules
and Regulations
[[Page 46370]]
-----------------------------------------------------------------------
DEPARTMENT OF HEALTH AND HUMAN SERVICES
Centers for Medicare & Medicaid Services
42 CFR Part 412
[CMS-1554-F]
RIN 0938-AP19
Medicare Program; Inpatient Rehabilitation Facility Prospective
Payment System for Federal Fiscal Year 2009
AGENCY: Centers for Medicare & Medicaid Services (CMS), HHS.
ACTION: Final rule.
-----------------------------------------------------------------------
SUMMARY: This final rule updates the prospective payment rates for
inpatient rehabilitation facilities (IRFs) for Federal fiscal year (FY)
2009 (for discharges occurring on or after October 1, 2008 and on or
before September 30, 2009) as required under section 1886(j)(3)(C) of
the Social Security Act (the Act). Section 1886(j)(5) of the Act
requires the Secretary to publish in the Federal Register on or before
the August 1 that precedes the start of each fiscal year, the
classification and weighting factors for the IRF prospective payment
system's (PPS) case-mix groups and a description of the methodology and
data used in computing the prospective payment rates for that fiscal
year.
We are revising existing policies regarding the PPS within the
authority granted under section 1886(j) of the Act.
DATES: These regulations are effective October 1, 2008. The updated IRF
prospective payment rates are applicable for discharges on or after
October 1, 2008 and on or before September 30, 2009 (FY 2009).
FOR FURTHER INFORMATION CONTACT: Susanne Seagrave, (410) 786-0044, for
information regarding the payment policies.
Jeanette Kranacs, (410) 786-9385, for information regarding the
wage index.
SUPPLEMENTARY INFORMATION:
Table of Contents
I. Background
A. Historical Overview of the Inpatient Rehabilitation Facility
Prospective Payment System (IRF PPS)
B. Operational Overview of the Current IRF PPS
II. Provisions of the Proposed Rule
III. Analysis of and Responses to Public Comments
IV. Update to the Case-Mix Group (CMG) Relative Weights and Average
Length of Stay Values for FY 2009
V. FY 2009 IRF PPS Federal Prospective Payment Rates
A. Increase Factor and Labor-Related Share for FY 2009
B. Area Wage Adjustment
C. Description of the IRF Standard Payment Conversion Factor and
Payment Rates for FY 2009
D. Example of the Methodology for Adjusting the Federal
Prospective Payment Rates
VI. Update to Payments for High-Cost Outliers Under the IRF PPS
A. Update to the Outlier Threshold Amount for FY 2009
B. Update to the IRF Cost-to-Charge Ratio Ceilings
VII. Revisions to the Regulation Text in Response to the Medicare,
Medicaid, and SCHIP Extension Act of 2007
VIII. Post Acute Care Payment Reform
IX. Miscellaneous Comments
X. Provisions of the Final Rule
XI. Collection of Information Requirements
XII. Regulatory Impact Statement
Regulation Text
Addendum
Acronyms
Because of the many terms to which we refer by acronym in this
final rule, we are listing the acronyms used and their corresponding
terms in alphabetical order below.
ASCA Administrative Simplification Compliance Act, Public Law 107-
105
BBA Balanced Budget Act of 1997, Public Law 105-33
BBRA Medicare, Medicaid, and SCHIP [State Children's Health
Insurance Program] Balanced Budget Refinement Act of 1999, Public
Law 106-113
BIPA Medicare, Medicaid, and SCHIP [State Children's Health
Insurance Program] Benefits Improvement and Protection Act of 2000,
Public Law 106-554
CBSA Core-Based Statistical Area
CCR Cost-to-Charge Ratio
CFR Code of Federal Regulations
CMG Case-Mix Group
DRA Deficit Reduction Act of 2005, Public Law 109-171
DSH Disproportionate Share Hospital
ECI Employment Cost Index
FI Fiscal Intermediary
FR Federal Register
FY Federal Fiscal Year
GDP Gross Domestic Product
HHH Hubert H. Humphrey Building
HIPAA Health Insurance Portability and Accountability Act, Public
Law 104-191
IFMC Iowa Foundation for Medical Care
IPF Inpatient Psychiatric Facility
IPPS Inpatient Prospective Payment System
IRF Inpatient Rehabilitation Facility
IRF-PAI Inpatient Rehabilitation Facility-Patient Assessment
Instrument
IRF PPS Inpatient Rehabilitation Facility Prospective Payment System
IRVEN Inpatient Rehabilitation Validation and Entry
LIP Low-Income Percentage
LTCH Long-Term Care Hospital
MAC Medicare Administrative Contractor
MEDPAR Medicare Provider Analysis and Review
MMA Medicare Prescription Drug, Improvement, and Modernization Act
of 2003, Public Law 108-173
MMSEA Medicare, Medicaid, and SCHIP Extension Act of 2007, Public
Law 110-173
MSA Metropolitan Statistical Area
NAICS North American Industrial Classification System
OMB Office of Management and Budget
PAI Patient Assessment Instrument
PPS Prospective Payment System
RAND RAND Corporation
RFA Regulatory Flexibility Act, Public Law 96-354
RIA Regulatory Impact Analysis
RIC Rehabilitation Impairment Category
RPL Rehabilitation, Psychiatric, and Long-Term Care Hospital Market
Basket
SCHIP State Children's Health Insurance Program
SIC Standard Industrial Code
TEFRA Tax Equity and Fiscal Responsibility Act of 1982, Public Law
97-248
I. Background
A. Historical Overview of the Inpatient Rehabilitation Facility
Prospective Payment System (IRF PPS)
Section 4421 of the Balanced Budget Act of 1997 (BBA), Public Law
105-33, as amended by section 125 of the Medicare, Medicaid, and SCHIP
(State Children's Health Insurance Program) Balanced Budget Refinement
Act of 1999 (BBRA), Public Law 106-113, and by section 305 of the
Medicare, Medicaid, and SCHIP Benefits Improvement and Protection Act
of 2000 (BIPA), Public Law 106-554, provides for the implementation of
a per discharge prospective payment system (PPS) under section 1886(j)
of the Social Security Act (the Act) for inpatient rehabilitation
hospitals and inpatient rehabilitation units of a hospital (hereinafter
referred to as IRFs).
Payments under the IRF PPS encompass inpatient operating and
capital costs of furnishing covered rehabilitation services (that is,
routine, ancillary, and capital costs) but not direct graduate medical
education costs, costs of approved nursing and allied health education
activities, bad debts, and other services or items outside the scope of
the IRF PPS. Although a complete discussion of the IRF PPS provisions
appears in the original FY 2002 IRF PPS final rule (66 FR 41316) and
the FY 2006 IRF PPS final rule (70 FR 47880), we are providing below a
general description of the IRF PPS for fiscal years (FYs) 2002 through
2008.
Under the IRF PPS from FY 2002 through FY 2005, as described in the
FY 2002 IRF PPS final rule (66 FR 41316), the Federal prospective
payment rates were computed across 100 distinct case-mix groups (CMGs).
We constructed 95 CMGs using rehabilitation impairment
[[Page 46371]]
categories (RICs), functional status (both motor and cognitive), and
age (in some cases, cognitive status and age may not be a factor in
defining a CMG). In addition, we constructed five special CMGs to
account for very short stays and for patients who expire in the IRF.
For each of the CMGs, we developed relative weighting factors to
account for a patient's clinical characteristics and expected resource
needs. Thus, the weighting factors accounted for the relative
difference in resource use across all CMGs. Within each CMG, we created
tiers based on the estimated effects that certain comorbidities would
have on resource use.
We established the Federal PPS rates using a standardized payment
conversion factor (formerly referred to as the budget neutral
conversion factor). For a detailed discussion of the budget neutral
conversion factor, please refer to our FY 2004 IRF PPS final rule (68
FR 45684 through 45685). In the FY 2006 IRF PPS final rule (70 FR
47880), we discussed in detail the methodology for determining the
standard payment conversion factor.
We applied the relative weighting factors to the standard payment
conversion factor to compute the unadjusted Federal prospective payment
rates under the IRF PPS from FYs 2002 through 2005. Within the
structure of the payment system, we then made adjustments to account
for interrupted stays, transfers, short stays, and deaths. Finally, we
applied the applicable adjustments to account for geographic variations
in wages (wage index), the percentage of low-income patients, location
in a rural area (if applicable), and outlier payments (if applicable)
to the IRF's unadjusted Federal prospective payment rates.
For cost reporting periods that began on or after January 1, 2002
and before October 1, 2002, we determined the final prospective payment
amounts using the transition methodology prescribed in section
1886(j)(1) of the Act. Under this provision, IRFs transitioning into
the PPS were paid a blend of the Federal IRF PPS rate and the payment
that the IRF would have received had the IRF PPS not been implemented.
This provision also allowed IRFs to elect to bypass this blended
payment and immediately be paid 100 percent of the Federal IRF PPS
rate. The transition methodology expired as of cost reporting periods
beginning on or after October 1, 2002 (FY 2003), and payments for all
IRFs now consist of 100 percent of the Federal IRF PPS rate.
We established a CMS Web site as a primary information resource for
the IRF PPS. The Web site URL is https://www.cms.hhs.gov/
InpatientRehabFacPPS/ and may be accessed to download or view
publications, software, data specifications, educational materials, and
other information pertinent to the IRF PPS.
Section 1886(j) of the Act confers broad statutory authority upon
the Secretary to propose refinements to the IRF PPS. In the FY 2006 IRF
PPS final rule (70 FR 47880) and in correcting amendments to the FY
2006 IRF PPS final rule (70 FR 57166) that we published on September
30, 2005, we finalized a number of refinements to the IRF PPS case-mix
classification system (the CMGs and the corresponding relative weights)
and the case-level and facility-level adjustments. These refinements
included the adoption of OMB's Core-Based Statistical Area (CBSA)
market definitions, modifications to the CMGs, tier comorbidities, and
CMG relative weights, implementation of a new teaching status
adjustment for IRFs, revision and rebasing of the IRF market basket,
and updates to the rural, low-income percentage (LIP), and high-cost
outlier adjustments. Any reference to the FY 2006 IRF PPS final rule in
this final rule also includes the provisions effective in the
correcting amendments. For a detailed discussion of the final key
policy changes for FY 2006, please refer to the FY 2006 IRF PPS final
rule (70 FR 47880 and 70 FR 57166).
In the FY 2007 IRF PPS final rule (71 FR 48354), we further refined
the IRF PPS case-mix classification system (the CMG relative weights)
and the case-level adjustments, to ensure that IRF PPS payments
continue to reflect as accurately as possible the costs of care. For a
detailed discussion of the FY 2007 policy revisions, please refer to
the FY 2007 IRF PPS final rule (71 FR 48354).
In the FY 2008 IRF PPS final rule (72 FR 44284), we updated the
Federal prospective payment rates and the outlier threshold, revised
the IRF wage index policy, and clarified how we determine high-cost
outlier payments for transfer cases. For more information on the policy
changes implemented for FY 2008, please refer to the FY 2008 IRF PPS
final rule (72 FR 44284), in which we published the final FY 2008 IRF
Federal prospective payment rates.
After publication of the FY 2008 IRF PPS final rule (72 FR 44284),
section 115 of the Medicare, Medicaid, and SCHIP Extension Act of 2007,
Public Law 110-173 (MMSEA), amended section 1886(j)(3)(C) of the Act to
apply a zero percent increase factor for FYs 2008 and 2009, effective
for IRF discharges occurring on or after April 1, 2008. Section
1886(j)(3)(C) of the Act requires the Secretary to develop an increase
factor to update the IRF Federal prospective payment rates for each FY.
Based on the legislative change to the increase factor, we revised the
FY 2008 Federal prospective payment rates for IRF discharges occurring
on or after April 1, 2008. Thus, the final FY 2008 IRF Federal
prospective payment rates that were published in the FY 2008 IRF PPS
final rule (72 FR 44284) were effective for discharges occurring on or
after October 1, 2007 and on or before March 31, 2008; and the revised
FY 2008 IRF Federal prospective payment rates are effective for
discharges occurring on or after April 1, 2008 and on or before
September 30, 2008. The revised FY 2008 Federal prospective payment
rates are available on the CMS Web site at https://www.cms.hhs.gov/
InpatientRehabFacPPS/07_DataFiles.asp#TopOfPage.
B. Operational Overview of the Current IRF PPS
As described in the FY 2002 IRF PPS final rule, upon the admission
and discharge of a Medicare Part A fee-for-service patient, the IRF is
required to complete the appropriate sections of a patient assessment
instrument, the Inpatient Rehabilitation Facility-Patient Assessment
Instrument (IRF-PAI). All required data must be electronically encoded
into the IRF-PAI software product. Generally, the software product
includes patient classification programming called the GROUPER
software. The GROUPER software uses specific IRF-PAI data elements to
classify (or group) patients into distinct CMGs and account for the
existence of any relevant comorbidities.
The GROUPER software produces a five-digit CMG number. The first
digit is an alpha-character that indicates the comorbidity tier. The
last four digits represent the distinct CMG number. Free downloads of
the Inpatient Rehabilitation Validation and Entry (IRVEN) software
product, including the GROUPER software, are available on the CMS Web
site at https://www.cms.hhs.gov/InpatientRehabFacPPS/06_Software.asp.
Once a patient is discharged, the IRF submits a Medicare claim as a
Health Insurance Portability and Accountability Act (HIPAA), Public Law
104-191, compliant electronic claim or, if the Administrative
Compliance Act (ASCA), Public Law 107-105, permits, a paper claim, a
UB-04 or a CMS-1450, (as appropriate) using the five-digit CMG number
and sends it to the
[[Page 46372]]
appropriate Medicare fiscal intermediary (FI) or Medicare
Administrative Contractor (MAC). Claims submitted to Medicare must
comply with both ASCA and HIPAA. Section 3 of the ASCA amends section
1862(a) of the Act by adding paragraph (22) which requires the Medicare
program, subject to section 1862(h) of the Act, to deny payment under
Part A or Part B for any expenses for items or services ``for which a
claim is submitted other than in an electronic form specified by the
Secretary.'' Section 1862(h) of the Act, in turn, provides that the
Secretary shall waive such denial in situations in which there is no
method available for the submission of claims in an electronic form or
the entity submitting the claim is a small provider.
In addition, the Secretary also has the authority to waive such
denial ``in such unusual cases as the Secretary finds appropriate.'' We
refer the reader to the final rule, ``Medicare Program; Electronic
Submission of Medicare Claims'' (70 FR 71008, November 25, 2005).
Section 3 of the ASCA operates in the context of the administrative
simplification provisions of HIPAA, which include, among others, the
requirements for transaction standards and code sets codified in 45
CFR, parts 160 and 162, subparts A and I through R (generally known as
the Transactions Rule). The Transactions Rule requires covered
entities, including covered healthcare providers, to conduct covered
electronic transactions according to the applicable transaction
standards. (See the program claim memoranda issued and published by CMS
at: https://www.cms.hhs.gov/ElectronicBillingEDITrans/ and listed in the
addenda to the Medicare Intermediary Manual, Part 3, section 3600. CMS
instructions for the limited number of Medicare claims submitted on
paper are available at: https://www.cms.hhs.gov/manuals/downloads/
clm104c25.pdf.)
The Medicare FI or MAC processes the claim through its software
system. This software system includes pricing programming called the
``PRICER'' software. The PRICER software uses the CMG number, along
with other specific claim data elements and provider-specific data, to
adjust the IRF's prospective payment for interrupted stays, transfers,
short stays, and deaths, and then applies the applicable adjustments to
account for the IRF's wage index, percentage of low-income patients,
rural location, and outlier payments. For discharges occurring on or
after October 1, 2005, the IRF PPS payment also reflects the new
teaching status adjustment that became effective as of FY 2006, as
discussed in the FY 2006 IRF PPS final rule (70 FR 47880).
II. Provisions of the Proposed Rule
As discussed in the FY 2009 IRF PPS proposed rule (73 FR 22674), we
proposed to make revisions to the regulation text in response to
section 115 of the MMSEA. Specifically, we proposed to revise 42 CFR
part 412. We discuss these proposed revisions and others in detail
below.
A. Section 412.23 Excluded Hospitals: Classifications
We proposed to revise the regulation text in paragraph (b)(2)(i)
and remove paragraph (b)(2)(ii) in response to section 115 of the
MMSEA. To summarize, for cost reporting periods--
(1) Beginning on or after July 1, 2005, the hospital has served an
inpatient population of whom at least 60 percent require intensive
rehabilitation services for treatment of one or more of the conditions
specified at paragraph (b)(2)(ii) of this section (as amended by
removing former (b)(2)(ii) and redesignating former (b)(2)(iii) as the
new (b)(2)(ii)).
(2) A comorbidity that meets the criteria as specified in Sec.
412.23(b)(2)(i) may continue to be used to determine the compliance
threshold.
B. Additional Proposed Changes
Update the FY 2009 IRF PPS relative weights and average
length of stay values using the most current and complete Medicare
claims and cost report data, as discussed in section II of the FY 2009
IRF PPS proposed rule (73 FR 22674, 22676 through 22680).
Update the FY 2009 IRF PPS payment rates by the proposed
wage index and labor related share in a budget neutral manner, as
discussed in sections III.A and B of the FY 2009 IRF PPS proposed rule
(73 FR 22674, 22680 through 22686).
Update the outlier threshold amount for FY 2009, as
discussed in section IV.A of the FY 2009 IRF PPS proposed rule (73 FR
22674, 22686 through 22687).
Update the cost-to-charge ratio ceiling and the national
average urban and rural cost-to-charge ratios for purposes of
determining outlier payments under the IRF PPS, as discussed in section
IV.B of the FY 2009 IRF PPS proposed rule (73 FR 22674 at 22687).
III. Analysis of and Responses to Public Comments
We received approximately 17 timely items of correspondence
containing multiple comments on the FY 2009 IRF PPS proposed rule (73
FR 22674) from the public. We received comments from various trade
associations, inpatient rehabilitation facilities, health care industry
organizations, and health care consulting firms. The following
discussion, arranged by subject area, includes a summary of the public
comments that we received, and our responses to the comments appear
under the appropriate subject heading.
IV. Update to the CMG Relative Weights and Average Length of Stay
Values for FY 2009
As specified in 42 CFR 412.620(b)(1), we calculate a relative
weight for each CMG that is proportional to the resources needed by an
average inpatient rehabilitation case in that CMG. For example, cases
in a CMG with a relative weight of 2, on average, will cost twice as
much as cases in a CMG with a relative weight of 1. Relative weights
account for the variance in cost per discharge due to the variance in
resource utilization among the payment groups, and their use helps to
ensure that IRF PPS payments support beneficiary access to care as well
as provider efficiency.
In the FY 2009 IRF PPS proposed rule (73 FR 22674, 22676 through
22680), we proposed updates to the CMG relative weights and average
length of stay values using the most recent available data (FY 2006 IRF
claims, FY 2006 IRF-PAI, and FY 2006 IRF cost report data) to ensure
that IRF PPS payments continue to reflect as accurately as possible the
costs of care in IRFs. We proposed to do this using the same
methodology, with one change, that was described in the original, FY
2002 IRF PPS final rule (66 FR 41316) and the FY 2006 IRF PPS final
rule (70 FR 47880, 47887 through 47888). The proposed change to the
methodology involves using new, more detailed cost-to-charge ratio
(CCR) data from the cost reports of IRF subprovider units of primary
acute care hospitals, instead of CCR data from the associated primary
acute care hospitals, to calculate IRFs' average costs per case. In
general, we proposed to make this change in the methodology because the
more detailed CCR data from the IRF subprovider cost reports are now
available in sufficient detail, and the relationship between costs and
charge in the primary acute care hospital could differ from the
relationship between costs and charges in the IRF subprovider units,
making the data from the IRF subprovider units potentially more
accurate for estimating the average costs per case in these units. For
freestanding IRFs, we proposed to continue using CCR data from the
[[Page 46373]]
freestanding IRF's cost report. We also noted that in future years we
would continue to estimate the CMG relative weights using both the
primary acute care hospital CCRs and the IRF subprovider unit CCRs to
ensure that we continue to use the most appropriate data in updating
the CMG relative weights.
In addition, we proposed to make changes to the CMG relative
weights for FY 2009 in such a way that total estimated aggregate
payments to IRFs for FY 2009 would be the same with or without the
proposed changes (that is, in a budget neutral manner) by applying a
budget neutrality factor to the standard payment amount, as described
in section II of the FY 2009 IRF PPS proposed rule (73 FR 22674 at
22677). To compute the budget neutrality factor used to update the CMG
relative weights, we proposed to use the following steps:
Step 1. Calculate the estimated total amount of IRF PPS payments
for FY 2009 (with no proposed changes to the CMG relative weights).
Step 2. Apply the proposed changes to the CMG relative weights (as
discussed above) to calculate the estimated total amount of IRF PPS
payments for FY 2009.
Step 3. Divide the amount calculated in step 1 by the amount
calculated in step 2 to determine the budget neutrality factor that
would maintain the same total estimated aggregate payments in FY 2009
with and without the proposed changes to the CMG relative weights.
Step 4. Apply the proposed budget neutrality factor to the FY 2008
IRF PPS standard payment amount after the application of the budget-
neutral wage adjustment factor.
Note that the budget neutrality factor that we use to update the
CMG relative weights for FY 2009 changed from 0.9969 in the proposed
rule to 0.9939 in this final rule due to the use of updated FY 2007 IRF
claims data in this final rule.
We received five comments on the proposed updates to the CMG
relative weights and average length of stay values, which are
summarized below.
Comment: Several commenters supported the proposed update to the
CMG relative weights for FY 2009, with one commenter referring to the
proposed update as a ``step in the right direction.'' However, several
commenters specifically suggested that we analyze the FY 2007 IRF
claims and cost report data in computing the CMG relative weights for
FY 2009, as these data would reflect more of the impact of recent
changes in the 75 percent rule and the IRF medical necessity reviews
than the FY 2006 IRF claims and cost report data. Further, one
commenter recommended that we seek additional cost information to use
to compute the CMG relative weights, including nursing staff time data,
ancillary cost data, and other alternatives to the IRF claims and cost
report data that we currently use to compute the CMG relative weights.
Finally, a couple of commenters recommended that we recalibrate the CMG
relative weights more frequently, with one commenter specifically
asking that we recalibrate the CMG relative weights again next year
(for FY 2010) using the most recent available data.
Response: We agree with the commenters that we should analyze the
most recent available IRF data to compute the CMG relative weights for
FY 2009 in order to ensure that IRF PPS payments continue to reflect as
accurately as possible the costs of care in IRFs. For the proposed
rule, we used data from FY 2006 IRF claims, FY 2006 IRF-PAI, and FY
2006 IRF cost reports because that was the best available data at the
time. For this final rule, we have updated the IRF claims data used in
our analysis of the CMG relative weights and average length of stay
values from FY 2006 to FY 2007.
We note that we used FY 2006 IRF-PAI data for analyzing the CMG
relative weights in the proposed rule because we implemented some minor
adjustments to the classification system for FY 2007 in the FY 2007 IRF
PPS final rule (71 FR 48354, 48360 through 48370). Accordingly, some of
the CMGs that appeared on the FY 2006 IRF claims data would not be the
same CMGs that would be assigned under the current, post-FY 2007 IRF
classification system. We therefore used the FY 2006 IRF-PAI data for
the proposed rule to ensure that the appropriate current CMG was
assigned for all of the FY 2006 claims. However, use of the IRF-PAI
data was no longer necessary when we used the FY 2007 IRF claims data
for this final rule because the CMG information on the FY 2007 IRF
claims data incorporated all of the changes to the IRF classification
system that were implemented in the FY 2007 IRF PPS final rule (71 FR
48354, 48360 through 48370). We did not implement any changes to the
IRF classification system in the FY 2008 IRF PPS final rule (72 FR
44284). The results of our analysis of the FY 2007 IRF claims data are
reflected in the CMG relative weights and average length of stay values
presented in Table 1 in this final rule.
We further note that we have not updated the IRF cost report data
used in this final rule. Although we agree with the commenter that it
is important to analyze the most recent available cost report data to
reflect as fully as possible the changes in IRF patient populations
that may have occurred as a result of changes in the 75 percent rule
and the IRF medical necessity reviews, only a small portion of the FY
2007 IRF cost reports are available for analysis at this time.
Accordingly, we have continued to use the FY 2006 cost report data for
analyzing IRFs' costs per case in this final rule because these are the
most complete IRF cost report data available at this time. However, we
will continue to evaluate the need for further updates and refinements
to the CMG relative weights and average length of stay values in future
years and would update the cost report data, as appropriate, when the
data become available.
We appreciate the commenter's suggestions regarding alternative
data to use in analyzing the costs of caring for IRF patients, and we
will carefully consider the commenter's suggestions for future
refinements to the methodology for computing the CMG relative weights.
Finally, we agree with the commenters that we may need to update
the CMG relative weight and average length of stay analysis frequently
to ensure that IRF payments continue to reflect the costs of caring for
IRF patients, especially in light of recent changes resulting from
changes to the 75 percent rule and the IRF medical necessity reviews.
We intend to continue analyzing the most recent available data, and
will propose future refinements to the IRF classification and weighting
system based on that analysis, as appropriate.
Comment: One commenter stated a concern that the methodology used
to revise the IRF classification system in the FY 2006 IRF PPS final
rule (70 FR 47880) may have reduced the overall IRF case mix weights.
This commenter asked CMS to re-examine this issue.
Response: As discussed in the FY 2006 IRF PPS final rule (70 FR
47880, 47886 through 47904), the FY 2007 IRF PPS final rule (71 FR
48354, 48373 through 48374), and the FY 2008 IRF PPS final rule (72 FR
44284 at 44293), we have analyzed the data and it continues to show
that the FY 2006 refinements to the IRF classification system did not
cause a reduction in the overall IRF case mix weights or in aggregate
IRF payments. We have met with industry representatives several times
in order to understand their concerns. We have also discussed the
results of our analysis with them, which continues to show that we
implemented the FY 2006 refinements to the IRF
[[Page 46374]]
classification system in a budget neutral manner, so that estimated
aggregate payments to providers would not increase or decrease as a
result of these refinements.
Comment: One commenter questioned why only 141 (40 percent) of the
proposed FY 2009 CMG relative weight values increased compared with the
FY 2008 CMG relative weight values, while 212 (60 percent) of the
proposed FY 2009 CMG relative weight values decreased compared with the
FY 2008 CMG relative weight values. This commenter generally expressed
surprise at the proposed FY 2009 CMG relative weights values, but
indicated that certain changes appeared to be correct, particularly the
increases in the CMG relative weights for some of the orthopedic
conditions. However, the commenter questioned why the CMG relative
weight values for other types of cases decreased.
Response: As we discussed in the proposed rule (73 FR 22674 at
22680), updates to the CMG relative weights will result in some
increases and some decreases to the CMG relative weight values. This is
due to the distributional nature of CMG relative weight changes.
However, our updated analysis of the CMG relative weight values
presented in Table 1 of this final rule (which is based on more recent
data than that used in the proposed rule, as explained previously in
this section) now shows that more than half of the CMG relative weights
will increase and, further, that more than half of beneficiaries are in
payment groups for which the CMG relative weight will increase between
FY 2008 and FY 2009. Specifically, our analysis shows that 57 percent
of patients are classified into one of the 177 payment groups (that is,
the combination of CMG and tier) that will experience an increase in
the CMG relative weight value between FYs 2008 and 2009, and 43 percent
of patients are classified into one of the 176 classification groups
that will experience a decrease in the CMG relative weight value
between FYs 2008 and 2009.
Final Decision: We received only positive comments in support of
the proposal to change the methodology for determining IRFs' average
costs per case by using more detailed cost-to-charge ratio (CCR) data
from the cost reports of IRF subprovider units of primary acute care
hospitals to calculate the IRF subprovider units' average costs per
case. Thus, after carefully considering all of the comments that we
received on the proposed updates to the CMG relative weights and
average length of stay values, we are finalizing this change to the
methodology for the reasons explained previously and as described in
more detail in the proposed rule (73 FR 22674, 22676 through 22677).
For freestanding IRFs, we will continue to use the CCR data from the
freestanding IRFs' cost reports. Consistent with the methodology that
we used to compute the CMG relative weights for FYs 2002 through 2008,
with the one change described above, we are implementing the updates to
the CMG relative weights and average length of stay values presented in
Table 1 below. As recommended by the commenters, we have updated the
CMG relative weights and average length of stay values in Table 1 using
FY 2007 IRF claims data for this final rule. Further, as noted
previously, we have continued to use FY 2006 IRF cost report data for
this final rule because it is the best available cost report data at
this time.
Table 1--Relative Weights and Average Lengths of Stay for Case-Mix Groups
--------------------------------------------------------------------------------------------------------------------------------------------------------
CMG description Relative weight Average length of stay
CMG (M=motor, C=cognitive, ---------------------------------------------------------------------------------------
A=age) Tier 1 Tier 2 Tier 3 None Tier 1 Tier 2 Tier 3 None
--------------------------------------------------------------------------------------------------------------------------------------------------------
0101.................................. Stroke: M>51.05......... 0.7712 0.7108 0.6381 0.6059 9 10 9 8
0102.................................. Stroke: M>44.45 and 0.9694 0.8936 0.8021 0.7617 11 11 11 10
M<51.05 and C>18.5.
0103.................................. Stroke: M>44.45 and 1.1478 1.0580 0.9496 0.9018 14 14 12 12
M<51.05 and C<18.5.
0104.................................. Stroke: M>38.85 and 1.2192 1.1238 1.0087 0.9579 13 14 13 13
M<44.45.
0105.................................. Stroke: M>34.25 and 1.4320 1.3199 1.1848 1.1251 16 18 15 15
M<38.85.
0106.................................. Stroke: M>30.05 and 1.6632 1.5330 1.3761 1.3067 19 19 17 17
M<34.25.
0107.................................. Stroke: M>26.15 and 1.8970 1.7485 1.5695 1.4904 20 21 19 19
M<30.05.
0108.................................. Stroke: M<26.15 and 2.2795 2.1011 1.8860 1.7910 27 26 23 22
A>84.5.
0109.................................. Stroke: M>22.35 and 2.1786 2.0081 1.8025 1.7117 22 23 21 22
M<26.15 and A<84.5.
0110.................................. Stroke: M<22.35 and 2.7217 2.5087 2.2518 2.1384 30 30 27 26
A<84.5.
0201.................................. Traumatic brain injury: 0.7556 0.6464 0.5818 0.5295 10 10 8 8
M>53.35 and C>23.5.
0202.................................. Traumatic brain injury: 1.0305 0.8817 0.7935 0.7222 13 11 10 10
M>44.25 and M<53.35 and
C>23.5.
0203.................................. Traumatic brain injury: 1.1487 0.9828 0.8846 0.8051 12 13 12 11
M>44.25 and C<23.5.
0204.................................. Traumatic brain injury: 1.2934 1.1066 0.9959 0.9064 15 14 13 12
M>40.65 and M<44.25.
0205.................................. Traumatic brain injury: 1.5739 1.3466 1.2119 1.1030 17 17 16 14
M>28.75 and M<40.65.
0206.................................. Traumatic brain injury: 1.9530 1.6709 1.5039 1.3687 21 21 18 18
M>22.05 and M<28.75.
0207.................................. Traumatic brain injury: 2.6307 2.2508 2.0257 1.8437 36 28 24 22
M<22.05.
[[Page 46375]]
0301.................................. Non-traumatic brain 1.1084 0.9308 0.8358 0.7650 12 12 11 10
injury: M>41.05.
0302.................................. Non-traumatic brain 1.4120 1.1857 1.0647 0.9746 14 15 13 13
injury: M>35.05 and
M<41.05.
0303.................................. Non-traumatic brain 1.6938 1.4224 1.2772 1.1691 17 17 16 15
injury: M>26.15 and
M<35.05.
0304.................................. Non-traumatic brain 2.3130 1.9424 1.7441 1.5966 27 23 21 20
injury: M<26.15.
0401.................................. Traumatic spinal cord 0.9255 0.7883 0.7732 0.6566 12 12 11 9
injury: M>48.45.
0402.................................. Traumatic spinal cord 1.3933 1.1868 1.1640 0.9886 17 15 16 13
injury: M>30.35 and
M<48.45.
0403.................................. Traumatic spinal cord 2.2823 1.9440 1.9067 1.6194 28 23 23 21
injury: M>16.05 and
M<30.35.
0404.................................. Traumatic spinal cord 3.9766 3.3872 3.3222 2.8215 53 40 37 34
injury: M<16.05 and
A>63.5.
0405.................................. Traumatic spinal cord .0347 2.5850 2.5354 2.1532 42 30 29 27
injury: M<16.05 and
A<63.5.
0501.................................. Non-traumatic spinal 0.8107 0.6397 0.5945 0.5245 9 9 8 8
cord injury: M>51.35.
0502.................................. Non-traumatic spinal 1.0994 0.8675 0.8062 0.7113 13 11 11 10
cord injury: M>40.15
and M<51.35.
0503.................................. Non-traumatic spinal 1.4315 1.1296 1.0497 0.9261 16 14 13 13
cord injury: M>31.25
and M<40.15.
0504.................................. Non-traumatic spinal 1.7229 1.3596 1.2634 1.1147 21 17 16 15
cord injury: M>29.25
and M<31.25.
0505.................................. Non-traumatic spinal 2.0360 1.6066 1.4930 1.3173 23 21 19 17
cord injury: M>23.75
and M<29.25.
0506.................................. Non-traumatic spinal 2.8325 2.2351 2.0770 1.8325 32 27 25 23
cord injury: M<23.75.
0601.................................. Neurological: M>47.75... 0.9245 0.7546 0.7174 0.6542 11 9 10 9
0602.................................. Neurological: M>37.35 1.2366 1.0094 0.9596 0.8750 12 13 12 12
and M<47.75.
0603.................................. Neurological: M>25.85 1.5763 1.2866 1.2232 1.1154 16 16 15 14
and M<37.35.
0604.................................. Neurological: M<25.85... 2.0887 1.7049 1.6208 1.4780 24 21 20 18
0701.................................. Fracture of lower 0.9187 0.7742 0.7300 0.6563 11 10 10 9
extremity: M>42.15.
0702.................................. Fracture of lower 1.2116 1.0209 0.9627 0.8655 14 14 12 12
extremity: M>34.15 and
M<42.15.
0703.................................. Fracture of lower 1.4846 1.2510 1.1797 1.0606 16 16 15 14
extremity: M>28.15 and
M<34.15.
0704.................................. Fracture of lower 1.8994 1.6005 1.5093 1.3569 20 20 19 17
extremity: M<28.15.
0801.................................. Replacement of lower 0.7000 0.5704 0.5172 0.4714 8 7 8 7
extremity joint:
M>49.55.
0802.................................. Replacement of lower 0.9380 0.7643 0.6931 0.6317 10 10 9 9
extremity joint:
M>37.05 and M<49.55.
0803.................................. Replacement of lower 1.3383 1.0905 0.9889 0.9013 14 13 13 12
extremity joint:
M>28.65 and M<37.05 and
A>83.5.
0804.................................. Replacement of lower 1.1745 0.9571 0.8679 0.7910 13 12 11 10
extremity joint:
M>28.65 and M<37.05 and
A<83.5.
0805.................................. Replacement of lower 1.4661 1.1947 1.0833 0.9874 16 16 13 13
extremity joint:
M>22.05 and M<28.65.
0806.................................. Replacement of lower 1.8139 1.4780 1.3403 1.2215 18 18 17 15
extremity joint:
M<22.05.
0901.................................. Other orthopedic: 0.8584 0.7574 0.6829 0.6041 10 10 9 9
M>44.75.
0902.................................. Other orthopedic: 1.1473 1.0122 0.9127 0.8074 13 13 12 11
M>34.35 and M<44.75.
[[Page 46376]]
0903.................................. Other orthopedic: 1.4840 1.3093 1.1806 1.0443 16 16 15 14
M>24.15 and M<34.35.
0904.................................. Other orthopedic: 1.9620 1.7310 1.5608 1.3807 22 22 19 18
M<24.15.
1001.................................. Amputation, lower 0.9356 0.9061 0.7797 0.7137 11 12 11 10
extremity: M>47.65.
1002.................................. Amputation, lower 1.2522 1.2127 1.0435 0.9552 14 15 13 12
extremity: M>36.25 and
M<47.65.
1003.................................. Amputation, lower 1.8193 1.7619 1.5161 1.3877 19 21 19 17
extremity: M<36.25.
1101.................................. Amputation, non-lower 1.1846 0.9851 0.9851 0.8558 12 12 13 11
extremity: M>36.35.
1102.................................. Amputation, non-lower 1.7288 1.4377 1.4377 1.2490 17 18 17 15
extremity: M<36.35.
1201.................................. Osteoarthritis: M>37.65. 1.0319 0.9668 0.8483 0.7541 11 12 11 10
1202.................................. Osteoarthritis: M>30.75 1.3034 1.2212 1.0715 0.9525 14 15 13 13
and M<37.65.
1203.................................. Osteoarthritis: M<30.75. 1.6379 1.5346 1.3465 1.1969 16 18 17 15
1301.................................. Rheumatoid, other 1.0983 0.9874 0.8499 0.7648 12 12 11 10
arthritis: M>36.35.
1302.................................. Rheumatoid, other 1.4790 1.3296 1.1445 1.0299 15 16 14 13
arthritis: M>26.15 and
M<36.35.
1303.................................. Rheumatoid, other 1.9140 1.7208 1.4812 1.3329 24 22 18 17
arthritis: M<26.15.
1401.................................. Cardiac: M>48.85........ 0.8003 0.7221 0.6388 0.5667 10 11 9 8
1402.................................. Cardiac: M>38.55 and 1.1095 1.0010 0.8856 0.7856 13 13 12 11
M<48.85.
1403.................................. Cardiac: M>31.15 and 1.3578 1.2251 1.0838 0.9615 15 15 13 13
M<38.55.
1404.................................. Cardiac: M<31.15........ 1.7628 1.5905 1.4071 1.2483 20 20 17 16
1501.................................. Pulmonary: M>49.25...... 0.9603 0.8386 0.7413 0.7038 11 12 10 9
1502.................................. Pulmonary: M>39.05 and 1.2297 1.0739 0.9494 0.9013 13 13 12 11
M<49.25.
1503.................................. Pulmonary: M>29.15 and 1.5640 1.3658 1.2074 1.1463 16 17 14 14
M<39.05.
1504.................................. Pulmonary: M<29.15...... 1.9525 1.7051 1.5073 1.4310 22 19 17 17
1601.................................. Pain syndrome: M>37.15.. 1.1094 0.8968 0.7667 0.7068 13 13 10 10
1602.................................. Pain syndrome: M>26.75 1.4978 1.2108 1.0351 0.9543 16 16 13 13
and M<37.15.
1603.................................. Pain syndrome: M<26.75.. 1.9287 1.5590 1.3328 1.2287 22 19 17 16
1701.................................. Major multiple trauma 1.0454 0.9189 0.8461 0.7419 11 12 11 10
without brain or spinal
cord injury: M>39.25.
1702.................................. Major multiple trauma 1.3777 1.2110 1.1151 0.9778 14 15 14 13
without brain or spinal
cord injury: M>31.05
and M<39.25.
1703.................................. Major multiple trauma 1.6566 1.4561 1.3408 1.1757 18 17 16 15
without brain or spinal
cord injury: M>25.55
and M<31.05.
1704.................................. Major multiple trauma 2.0776 1.8261 1.6815 1.4744 23 24 21 19
without brain or spinal
cord injury: M<25.55.
1801.................................. Major multiple trauma 1.2189 0.9629 0.9044 0.7757 15 13 13 10
with brain or spinal
cord injury: M>40.85.
1802.................................. Major multiple trauma 1.8398 1.4533 1.3651 1.1708 19 17 16 15
with brain or spinal
cord injury: M>23.05
and M<40.85.
1803.................................. Major multiple trauma 3.1442 2.4838 2.3329 2.0009 37 31 26 24
with brain or spinal
cord injury: M<23.05.
1901.................................. Guillian Barre: M>35.95. 1.1582 0.9288 0.9288 0.8782 15 11 11 12
1902.................................. Guillian Barre: M>18.05 2.3408 1.8772 1.8772 1.7749 26 22 25 22
and M<35.95.
1903.................................. Guillian Barre: M<18.05. 3.5944 2.8825 2.8825 2.7254 33 35 41 31
2001.................................. Miscellaneous: M>49.15.. 0.8820 0.7282 0.6614 0.5928 11 9 9 8
[[Page 46377]]
2002.................................. Miscellaneous: M>38.75 1.1873 0.9803 0.8904 0.7980 12 13 11 11
and M<49.15.
2003.................................. Miscellaneous: M>27.85 1.5231 1.2575 1.1422 1.0237 16 16 14 13
and M<38.75.
2004.................................. Miscellaneous: M<27.85.. 2.0363 1.6812 1.5271 1.3686 22 20 19 17
2101.................................. Burns: M>0.............. 2.3666 2.3666 2.1481 1.7454 25 25 25 17
5001.................................. Short-stay cases, length ......... ......... ......... 0.1476 ......... ......... ......... 3
of stay is 3 days or
fewer.
5101.................................. Expired, orthopedic, ......... ......... ......... 0.6783 ......... ......... ......... 8
length of stay is 13
days or fewer.
5102.................................. Expired, orthopedic, ......... ......... ......... 1.5432 ......... ......... ......... 19
length of stay is 14
days or more.
5103.................................. Expired, not orthopedic, ......... ......... ......... 0.7086 ......... ......... ......... 9
length of stay is 15
days or fewer.
5104.................................. Expired, not orthopedic, ......... ......... ......... 1.9586 ......... ......... ......... 23
length of stay is 16
days or more.
--------------------------------------------------------------------------------------------------------------------------------------------------------
V. FY 2009 IRF PPS Federal Prospective Payment Rates
A. Increase Factor and Labor-Related Share for FY 2009
Section 1886(j)(3)(C) of the Act requires the Secretary to
establish an increase factor that reflects changes over time in the
prices of an appropriate mix of goods and services included in the
covered IRF services, which is referred to as a market basket index.
According to section 1886(j)(3)(A)(i) of the Act, the increase factor
shall be used to update the IRF Federal prospective payment rates for
each FY. However, section 115 of the MMSEA, amended section
1886(j)(3)(C) of the Act to apply a zero percent increase factor for
FYs 2008 and 2009, effective for IRF discharges occurring on or after
April 1, 2008. Thus, we are applying an increase factor of zero percent
to update the IRF Federal prospective payment rates for FY 2009 in this
final rule.
We continue to use the methodology described in the FY 2006 IRF PPS
final rule to update the IRF labor-related share for FY 2009 (70 FR
47880, 47908 through 47917). The IRF labor-related share for FY 2009 is
the sum of the FY 2009 relative importance of each labor-related cost
category, and reflects the different rates of price change for these
cost categories between the base year (FY 2002) and FY 2009. Consistent
with our proposal to update the labor-related share with the most
recent available data, the labor-related share for this final rule
reflects Global Insight's second quarter 2008 forecast. (Global Insight
is a nationally recognized economic and financial forecasting firm that
contracts with CMS to forecast the components of providers' market
baskets.) As shown in Table 2, the total FY 2009 Rehabilitation,
Psychiatric, and Long-Term Care Hospital Market Basket (RPL) labor-
related share in this final rule is 75.464 percent.
Table 2--FY 2009 IRF RPL Labor-Related Share Relative Importance
------------------------------------------------------------------------
FY 2009 IRF
labor-related
Cost category share relative
importance
------------------------------------------------------------------------
Wages and salaries.................................... 52.552
Employee benefits..................................... 13.982
Professional fees..................................... 2.890
All other labor intensive services.................... 2.120
-----------------
Subtotal.......................................... 71.544
Labor-related share of capital costs (.46)............ 3.920
=================
Total......................................... 75.464
------------------------------------------------------------------------
SOURCE: GLOBAL INSIGHT, INC, 2nd QTR, 2008; @USMACRO/CONTROL0508 @CISSIM/
TL0508.SIM Historical Data through 1st QTR, 2008.
We received five comments on the increase factor and labor-related
share for FY 2009, which are summarized below.
Comment: Two commenters expressed concern that the zero percent
increase factor that we are applying to the IRF Federal prospective
payment rates for FY 2009, would impose a financial burden on IRFs.
These commenters noted that the zero percent increase factor for FY
2009 was required by section 115 of the MMSEA, which also made
revisions to the 60 percent rule. The commenters requested that any
future legislative changes to the 60 percent rule also be considered in
combination with updates to the IRF Federal prospective payment rates.
Response: As we discussed in the FY 2009 IRF PPS proposed rule (73
FR 22674, 22680 through 22681), section 115 of the MMSEA amended
section 1886(j)(3)(C) of the Act to apply a zero percent increase
factor for FYs 2008 and 2009, effective for IRF discharges occurring on
or after April 1, 2008. While we understand that the effect of the zero
percent increase factor is to maintain FY 2009 IRF PPS payment rates at
FY 2008 levels, the statute does not give CMS the discretion to
implement an increase factor other than zero percent for FY 2009. We
will respond to any future legislative changes to the 60 percent rule
accordingly.
Comment: One commenter requested that CMS calculate the IRF PPS
market basket estimates using more current market basket data. This
commenter stated that the FY 2009 market basket estimate is based on
data from FY 2002, and that the FY 2002 data underestimate the increase
in costs, especially labor costs, that IRFs have experienced. The
commenter suggested that CMS use Medicare cost report data to compute
the market basket estimate, rather than data from the Bureau of Labor
Statistics, in order to make the estimate more current.
Response: The IRF PPS market basket, which is a fixed weight,
Laspeyres-type price index, is constructed in three
[[Page 46378]]
steps. First, a base period is selected (FY 2002 in the current market
basket) and total base period expenditures are estimated for a set of
mutually exclusive and exhaustive spending categories based upon type
of expenditure. The proportion of total operating costs that each
category represents is called a cost or expenditure weight.
Medicare Cost Report (MCR) data are used to derive the primary cost
weights for the market basket. We monitor the stability of these cost
weights and have determined that they do not tend to fluctuate over
short periods of time (such as a period of less than 5 years). In
general, we have typically rebased (recalculated market basket cost
weights) approximately every 5 years. We note that we last revised and
rebased the market basket in the FY 2006 IRF PPS final rule (70 FR
47880, 47915 through 47917).
Second, the FY 2002 expenditure weight for each cost category is
matched to an appropriate price or wage variable, referred to as a
price proxy. These price proxies are selected to reflect the rate-of-
price change for each expenditure category and are primarily obtained
from the Bureau of Labor Statistics (BLS).
Finally, each FY 2002 cost weight 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.
The final IRF market basket update for FY 2009 is calculated using
the market basket levels from the second quarter of 2008 (2008Q2)
forecast prepared by Global Insight, Inc. (GII). These levels reflect
the most recent price data available (historical price data through
2008Q1 and forecasted price data for 2008Q2 and beyond).
Given the methodology described above, the current market basket
estimate is not based solely on FY 2002 data, but rather is calculated
by applying the most recent available price data for each quarter to
the FY 2002 cost weights. Thus, the current FY 2009 market basket
estimate does in fact reflect recent price increases experienced by
IRFs.
Comment: Several commenters expressed concern about the methodology
for computing the labor-related share. One commenter requested that we
begin updating the labor-related share more frequently using the most
recent available data. The commenter stated that the current
calculation of the labor-related share is based on 2002 data. Another
commenter said that the methodology does not adequately reflect the
difficulty IRFs have in recruiting a skilled labor force.
Response: The FY 2009 labor-related share is intended to reflect
those costs that are related to, influenced by, or vary with the local
labor market. Accordingly, the share is calculated as the sum of the
relative importance of the appropriate categories which include wages
and salaries, fringe benefits, professional fees, labor-intensive
services, and a portion of capital costs. We calculate this share based
on the RPL market basket, which we believe adequately captures the
current cost structures of Medicare-participating IRFs.
By following a four-step process to estimate the labor-related
relative importance for FY 2009, we are making use of up-to-date data
that reflect current trends. As a result, the labor-related share
appropriately reflects current labor market price pressures experienced
by IRFs. The process is as follows: First, we compute the FY 2009 price
index level for the total market basket and each cost category of the
market basket. Second, we calculate a ratio for each cost category by
dividing the FY 2009 price index level for that cost category by the
total market basket price index level. Third, we determine the FY 2009
relative importance for each cost category by multiplying this ratio by
the base year (FY 2002) weight. Finally, we sum the FY 2009 relative
importance for each of the labor-related categories to produce the FY
2009 labor-related relative importance.
The price proxies that move the different cost categories in the
market basket do not necessarily change at the same rate, and the
relative importance captures these potential differential growth rates.
Accordingly, the relative importance figure more closely reflects